信隆健康(002105) - 2025 Q2 - 季度财报

Important Notes, Table of Contents, and Definitions Important Notes The company's board, supervisory board, and senior management guarantee the semi-annual report's truthfulness, accuracy, and completeness, with some independent directors attending by proxy, and no interim dividend distribution planned - The company's board of directors, supervisory board, and senior management guarantee the truthfulness, accuracy, and completeness of the semi-annual report content[4] - Some independent directors (Gao Haijun, Wang Weiwang, Chen Dalu) were unable to attend board meetings in person due to business trips or being abroad; Gao Haijun and Wang Weiwang entrusted Gan Yongming to attend on their behalf, while Chen Dalu had no proxy[4] - The company plans not to distribute cash dividends, bonus shares, or convert capital reserves to share capital for the semi-annual period[5] Table of Contents The report's table of contents clearly outlines nine main chapters, covering essential company and financial information - The report contains nine main chapters, with a clear structure[8] Definitions This section defines key terms, entities, and the reporting period for the first half of 2025 used throughout the report - The reporting period refers to the first half of 2025[11] - Definitions are provided for the Company, China Securities Regulatory Commission (CSRC), Shenzhen Stock Exchange (SZSE), and multiple subsidiaries (e.g., Hong Kong Litian, Taicang Xinlong, HL Corp (USA), Vietnam Xinyou)[11] Company Profile and Key Financial Indicators Company Profile Shenzhen HLC Corp. (stock code: 002105) is listed on the SZSE, with its legal representative and contact information unchanged - The company's stock abbreviation is "HLC Corp.", stock code "002105", listed on the Shenzhen Stock Exchange[13] - The company's legal representative is Liao Xuejin[13] - The Board Secretary is Chen Liqiu, contact number 0755-27749423-8105, email cmo@hlcorp.com[14] Key Accounting Data and Financial Indicators In H1 2025, operating revenue grew 9.18%, but net profit attributable to shareholders significantly declined by 341.23%, turning to loss, with total assets and net assets also decreasing 2025 Semi-Annual Key Accounting Data and Financial Indicators | Indicator | Current Period (CNY) | Prior Year Period (CNY) | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Operating Revenue | 581,572,945.02 | 532,685,363.24 | 9.18% | | Net Profit Attributable to Shareholders of Listed Company | -15,747,197.90 | 6,527,977.36 | -341.23% | | Net Profit Attributable to Shareholders of Listed Company After Deducting Non-recurring Gains and Losses | -18,488,755.25 | 3,875,759.54 | -577.04% | | Net Cash Flow from Operating Activities | 12,516,823.95 | 11,535,743.53 | 8.50% | | Basic Earnings Per Share (CNY/share) | -0.043 | 0.018 | -338.89% | | Diluted Earnings Per Share (CNY/share) | -0.043 | 0.018 | -338.89% | | Weighted Average Return on Net Assets | -1.82% | 0.73% | -2.55% | 2025 Semi-Annual End Asset and Liability Indicators | Indicator | End of Current Period (CNY) | End of Prior Year (CNY) | Change from Prior Year-End | | :--- | :--- | :--- | :--- | | Total Assets | 1,642,820,285.61 | 1,724,219,080.34 | -4.72% | | Net Assets Attributable to Shareholders of Listed Company | 856,206,180.35 | 875,028,225.04 | -2.15% | Non-recurring Gains and Losses Items and Amounts Non-recurring gains and losses totaled CNY 2,741,557.35, mainly from asset disposal, government subsidies, and other non-operating items 2025 Semi-Annual Non-recurring Gains and Losses Items and Amounts | Item | Amount (CNY) | | :--- | :--- | | Gains or losses from disposal of non-current assets | -184,471.34 | | Government subsidies recognized in current profit or loss (excluding those closely related to the company's normal operations, compliant with national policies, enjoyed at fixed standards, and with continuous impact on company profit or loss) | 979,165.46 | | Other non-operating income and expenses apart from the above | 2,642,899.30 | | Less: Income tax impact | 801,035.86 | | Minority interest impact (after tax) | -104,999.79 | | Total | 2,741,557.35 | Management Discussion and Analysis Main Businesses Engaged by the Company During the Reporting Period The company's core business is R&D, production, and sales of bicycle parts, sports equipment, and rehabilitation aids, with no significant changes in the reporting period - The company's main business includes the R&D, production, and sales of bicycle parts (handlebars, stems, seat posts, suspension forks, disc brakes), sports equipment (wheeled sports vehicles like electric scooters), and rehabilitation aids (wheelchairs)[25] - The company has production bases in South China, North China, and Vietnam, with products exported to Taiwan, Europe, America, and other countries and regions[25] - During the reporting period, the company's production and operations remained stable, with no significant changes in its main business[25] Analysis of Core Competencies The company leverages a 50-year global reputation in bicycle parts, advanced automation in sports equipment, and ISO13485 certification in rehabilitation aids - In the bicycle parts sector, the company boasts over 50 years of global reputation, a stable customer base, and production capacity advantages from its South China, North China, and Vietnam factories[26] - In the sports equipment sector, mechanical arm automatic welding technology achieves over 98% automation, the company implements TPS production management, and operates an industry-leading laboratory[26] - In the rehabilitation equipment sector, the company is ISO13485 medical system certified and collaborates with global top three companies like Sunrise and Invacare to develop wheelchair products[27] Main Business Analysis H1 2025 main business revenue grew 9.18%, but net profit turned to loss due to rising aluminum prices and USD depreciation, with varied performance across product lines Operating Revenue Composition (by Industry) | Industry | Current Period Amount (CNY) | Proportion of Operating Revenue | Prior Year Period Amount (CNY) | Proportion of Operating Revenue | Year-on-Year Change | | :--- | :--- | :--- | :--- | :--- | :--- | | Bicycle Parts | 391,345,033.95 | 67.29% | 378,969,800.09 | 71.14% | 3.27% | | Sports and Fitness Rehabilitation Equipment | 177,924,030.15 | 30.59% | 140,854,516.71 | 26.44% | 26.32% | | Other Businesses | 12,303,880.92 | 2.12% | 12,861,046.44 | 2.41% | -4.33% | Operating Revenue Composition (by Product) | Product | Current Period Amount (CNY) | Proportion of Operating Revenue | Prior Year Period Amount (CNY) | Proportion of Operating Revenue | Year-on-Year Change | | :--- | :--- | :--- | :--- | :--- | :--- | | Bicycle Parts Products | 391,345,033.95 | 67.29% | 378,969,800.09 | 71.14% | 3.27% | | Sports and Fitness Products | 90,833,644.67 | 15.62% | 27,171,844.52 | 5.10% | 234.29% | | Rehabilitation Equipment Products | 87,090,385.48 | 14.97% | 113,682,672.19 | 21.34% | -23.39% | | Other Businesses | 12,303,880.92 | 2.12% | 12,861,046.44 | 2.41% | -4.33% | Operating Revenue Composition (by Region) | Region | Current Period Amount (CNY) | Proportion of Operating Revenue | Prior Year Period Amount (CNY) | Proportion of Operating Revenue | Year-on-Year Change | | :--- | :--- | :--- | :--- | :--- | :--- | | Americas | 61,288,666.61 | 10.54% | 70,581,271.61 | 13.25% | -13.17% | | Europe | 102,135,711.89 | 17.56% | 122,041,155.40 | 22.91% | -16.31% | | Asia | 101,737,592.05 | 17.49% | 70,169,147.45 | 13.17% | 44.99% | | Domestic Sales | 293,933,769.93 | 50.54% | 259,742,869.06 | 48.76% | 13.16% | | Other Regions | 22,477,204.54 | 3.86% | 10,150,919.72 | 1.91% | 121.43% | - During the reporting period, the company's operating profit was -CNY 13.6192 million, a year-on-year decrease of 274.75%, primarily due to rising raw material aluminum prices leading to a decline in gross profit margin[137][138] - Financial expenses increased by 138.68% year-on-year, mainly due to increased exchange losses from USD depreciation[138] - Income tax expenses increased by 756.15% year-on-year, primarily due to subsidiary Tianjin Xinlong's self-inspection and supplementary payment of prior year income tax totaling CNY 4.2855 million[138] Bicycle Parts Business H1 2025 saw global bicycle parts market recovery, driven by e-bike parts, intelligence, and lightweight trends, with domestic e-bike parts output up 38.5% - In the first half of 2025, the global bicycle parts industry showed overall recovery and growth, with electric bicycle parts becoming a core growth driver, and the global motor kit market reaching USD 2.036 billion[29] - Technology innovation drives trends, with accelerating intelligence penetration (GPS navigation, health monitoring accessories penetration increased from 15% in 2024 to 25%), and a 20% reduction in carbon fiber costs promoting lightweight development[30] - The domestic market's "trade-in" policy stimulated a 38.5% increase in electric bicycle parts output in Q1[37] - From January to May 2025, China's cumulative bicycle export value was USD 1.214 billion, a year-on-year increase of 3.6%; exports to the US continuously declined year-on-year for seven months, with a 64.7% year-on-year decrease in May alone[39][41] - The company's annual production of bicycle control parts accounts for approximately 25% of global demand, and its suspension fork global market share is about 10%[56] - In the first half of the year, the company actively participated in international exhibitions (Taipei Cycle Show/Shanghai Cycle Show/Eurobike), formed strategic alliances with brands and bicycle assemblers, and strengthened brand exposure and new product promotion[65] - Plans for the second half of the year include developing potential new customers, deepening relationships with existing customers, increasing the market share of forks for the European subsidiary, strengthening the industrial ecosystem layout, optimizing product functions and cost-effectiveness, and enhancing Vietnam Xinyou's production capacity[67] Sports and Fitness Equipment Business H1 2025 saw global economic slowdown and trade protectionism, but the company's OEM e-scooter business maintained strong quality control and supply chain advantages - In the first half of 2025, global economic growth slowed, with rising trade protectionism, but emerging markets grew faster than developed countries, with East Asia growing 4.7% and South Asia 5.7%[68] - Europe's automotive industry accelerated electrification, with pure electric vehicle share rising from 12% to 15.2%, and Chinese brand BYD's market share in Europe surpassing Tesla for the first time[75] - The company's electric scooters are primarily OEM, without specific market share, but possess a complete quality control and production management system (ISO9000, ISO14000, BSCI) and a mature supply chain[79][80] - In the first half of the year, shared electric scooters shipped totaled 12,232 units, generating CNY 35.68 million in revenue; an additional order of 25,000 units is expected by the end of August, potentially generating CNY 73 million in revenue[94] - Plans for the second half of the year include participating in the Canton Fair, Russian Motorcycle and Electric Vehicle Autumn Exhibition, and Germany's INTERMOT (International Motorcycle, Scooter and E-Bike Fair) to promote products and secure orders[95][96] - R&D progress in the first half included one seated scooter mold in progress, high-speed motors and small four-wheel electric vehicles under design, extreme scooters undergoing testing, and multiple accessories already ordered or shipped[97] Rehabilitation Aids Business H1 2025 saw global economic slowdown, but the electric wheelchair market grew, especially in Asia-Pacific and China, driven by aging populations and supportive policies - Global GDP growth is projected to be 2.3% in the first half of 2025, the lowest since 2008, with trade policy uncertainty as a core risk[99][100] - The global electric wheelchair market size was approximately USD 3.871 billion in 2024, a year-on-year increase of 7.92%; a stable compound annual growth rate is expected from 2025-2031[111] - The Asia-Pacific region accounts for 45% of the global wheelchair market, North America 23%, and Europe 22%[113] - China's electric wheelchair market size reached CNY 6.972 billion in 2023, growing to CNY 7.786 billion in 2024, with continued growth expected in 2025[118] - The company's main competitive advantages include stable OEM product quality, ISO13485 medical system certification, a complete quality system, advanced automated equipment, sufficient production capacity flexibility, and strong technical support and development resources[120] - First-half revenue decreased by 29% compared to the same period in 2024, with the European line down 28% and the American line down 32%, primarily due to external economic conditions, market demand contraction, and major customers initiating inventory reduction plans[134] - In the first half, 10 new product development projects were completed and entered mass production, estimated to bring over CNY 3 million in additional revenue; 12 new product development projects are currently underway[135] - Second-half expansion plans include prioritizing revenue growth, actively tracking new product and customer development, visiting major European customers, participating in the German RehaCare exhibition, and focusing on ODM product R&D for manual and electric wheelchairs[136] Non-Core Business Analysis Non-core businesses significantly impacted total profit with investment losses, asset impairment, non-operating income (demolition compensation), and expenses, none sustainable Impact of Non-Core Business on Total Profit | Item | Amount (CNY) | Proportion of Total Profit | Reason for Formation | Sustainability | | :--- | :--- | :--- | :--- | :--- | | Investment Income | -1,683,644.97 | 15.34% | Investment loss recognized from associate Tianteng Power | Not sustainable | | Asset Impairment | -3,256,876.10 | 29.67% | Provision for inventory obsolescence | Not sustainable | | Non-Operating Income | 4,991,965.73 | -45.48% | Received two temporary resettlement compensation payments for Longhua factory demolition from Zhongzhou | Not sustainable | | Non-Operating Expenses | 2,349,066.43 | -21.40% | Losses from disposal of non-current assets | Not sustainable | Analysis of Assets and Liabilities Total assets decreased by 4.72% to CNY 1.643 billion, with construction in progress up 100% due to Vietnam Xinyou Phase II factory expansion Significant Changes in Asset Composition | Item | End of Current Period Amount (CNY) | Proportion of Total Assets | End of Prior Year Amount (CNY) | Proportion of Total Assets | Change in Proportion | Significant Change Explanation | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Cash and Bank Balances | 402,250,095.08 | 24.49% | 383,627,125.63 | 22.25% | 2.24% | | | Accounts Receivable | 283,441,110.48 | 17.25% | 311,738,110.53 | 18.08% | -0.83% | | | Inventories | 168,046,125.40 | 10.23% | 230,158,313.78 | 13.35% | -3.12% | | | Construction in Progress | 31,238,124.44 | 1.90% | 15,496,265.15 | 0.90% | 1.00% | Primarily due to increased investment in subsidiary Vietnam Xinyou Phase II factory construction during the reporting period | | Short-term Borrowings | 289,050,169.16 | 17.59% | 254,042,600.01 | 14.73% | 2.86% | | | Long-term Borrowings | 103,145,143.61 | 6.28% | 85,977,223.40 | 4.99% | 1.29% | | | Accounts Payable | 182,278,551.41 | 11.10% | 277,951,339.99 | 16.12% | -5.02% | Primarily due to reduced orders in Q2, leading to a decrease in supplier purchases | - At the end of the reporting period, the company's asset-liability ratio was 43.62%, a decrease from 44.96% at the end of the previous year[173][744] - Restricted assets totaled CNY 389 million at period-end, mainly comprising mortgaged fixed assets, intangible assets, and investment properties[150] Investment Status Analysis Investment increased by 118.60% to CNY 23.24 million, with no significant equity, non-equity, securities, or derivative investments, and no use of raised funds Current Period Investment Amount | Current Period Investment Amount (CNY) | Prior Year Period Investment Amount (CNY) | Change Percentage | | :--- | :--- | :--- | | 23,243,613.85 | 10,632,813.93 | 118.60% | - The company had no securities investments, derivative investments, or use of raised funds during the reporting period[152][153][154] Significant Asset and Equity Sales No significant asset or equity sales occurred during the reporting period - The company did not sell significant assets or equity during the reporting period[155][156] Analysis of Major Holding and Associate Companies Key subsidiaries like Tianjin Xinlong, Vietnam Xinyou, and Wuhan Tianteng Power reported losses due to tax adjustments, market conditions, or destocking, despite some revenue growth - Tianjin Xinlong reported a profit loss during the reporting period, mainly due to a self-inspection and supplementary payment of prior year income tax totaling CNY 4.2855 million[157] - Vietnam Xinyou's revenue increased by 28.66% year-on-year, and its net profit loss decreased by 28.08% year-on-year, primarily due to increased market development efforts and order volume[158] - Taicang Health Industry's sales revenue increased by 620.39% year-on-year, but its profit remained a loss due to a 133.43% year-on-year increase in selling expenses[159] - Wuhan Tianteng Power suffered a profit loss due to the industry's destocking cycle and market competition, leading to decreased market demand and unsatisfactory revenue growth[159] - Shenzhen Leiqi Technology Co., Ltd., primarily engaged in wholesale, retail, and leasing of sports equipment, reported a profit loss during the reporting period as business development fell short of expectations[159] - Taicang Xinlong Vehicle Materials Co., Ltd. has ceased production and transitioned to a business of leasing its own assets, with all revenue during the reporting period derived from property leasing[159] Information on Structured Entities Controlled by the Company The company had no controlled structured entities during the reporting period - The company had no controlled structured entities during the reporting period[160] Risks Faced by the Company and Countermeasures The company faces market, raw material price, and financial risks, actively addressing them through market expansion, product innovation, cost reduction, and financial management - Major risks include market environment changes (international trade friction affecting global layout of bicycle assemblers), upstream raw material price fluctuations (rising aluminum tube and ingot prices), and financial risks (asset-liability ratio of 43.62%, significant overseas business exposure to exchange rate fluctuations)[160][744] - Countermeasures include selecting the Chinese mainland and European markets as initial expansion areas, participating in international bicycle exhibitions, forming strategic alliances with various brands and bicycle assemblers, and strengthening after-sales service[161] - Countermeasures include independent R&D of new products, customized products, optimizing and enhancing the functionality of strategic products, improving the product chain, and achieving integrated product solutions[161][162] - Countermeasures include optimizing supplier management, centralized procurement, and establishing an inventory management system to reduce procurement costs; improving production efficiency, optimizing production processes, and strengthening energy management to reduce production costs[162][163] - Countermeasures include strengthening business cooperation with overseas distributors, adjusting product structure, adopting cross-border RMB settlement, and conducting forward foreign exchange transactions to hedge against exchange rate risks; expanding financing channels, improving borrowing structure, and strengthening accounts receivable management to enhance the company's capital efficiency and reduce financial risks[163][164] Formulation and Implementation of Market Value Management System and Valuation Enhancement Plan The company has not established a market value management system or disclosed a valuation enhancement plan - The company has not formulated a market value management system[165] - The company has not disclosed a valuation enhancement plan[166] Implementation of "Quality and Return Dual Improvement" Action Plan The company has not disclosed an announcement regarding the "Quality and Return Dual Improvement" action plan - The company has not disclosed an announcement regarding the "Quality and Return Dual Improvement" action plan[166] Corporate Governance, Environment, and Society Changes in Directors, Supervisors, and Senior Management No changes occurred in the company's directors, supervisors, and senior management during the reporting period - The company's directors, supervisors, and senior management had no changes during the reporting period[168] Profit Distribution and Capital Reserve Conversion to Share Capital for the Current Reporting Period The company plans no cash dividends, bonus shares, or capital reserve conversions to share capital for the semi-annual period - The company plans not to distribute cash dividends, bonus shares, or convert capital reserves to share capital for the semi-annual period[169] Implementation of Company's Equity Incentive Plans, Employee Stock Ownership Plans, or Other Employee Incentive Measures The company had no equity incentive plans, employee stock ownership plans, or other employee incentive measures implemented during the reporting period - The company had no equity incentive plans, employee stock ownership plans, or other employee incentive measures and their implementation during the reporting period[170] Environmental Information Disclosure Shenzhen HLC Corp. and Tianjin Xinlong Industrial Co., Ltd. are listed as enterprises required to disclose environmental information - Shenzhen HLC Corp. and Tianjin Xinlong Industrial Co., Ltd. are included in the list of enterprises required to disclose environmental information in accordance with the law[171] Enterprises Included in the List of Enterprises Required to Disclose Environmental Information | No. | Enterprise Name | | :--- | :--- | | 1 | Shenzhen HLC Corp. | | 2 | Tianjin Xinlong Industrial Co., Ltd. | Social Responsibility In H1 2025, the company's mutual aid fund provided CNY 4,165 for employee assistance and secured CNY 3,052 in hardship aid for one severely ill employee - In the first half of 2025, the company's mutual aid fund committee used CNY 4,165 to assist employees facing illness or hardship[172] - The company applied for CNY 3,052 in hardship assistance and慰问品 from the Bao'an District Government and Songgang Sub-district Office for one severely ill employee[172] - In the first half of 2025, the company employed 16 disabled individuals from surrounding communities, distributing CNY 224,539 in monthly wages[172] Significant Matters Fulfillment of Commitments No commitments by the company's actual controller, shareholders, related parties, or the company were fulfilled or overdue during the reporting period - During the reporting period, the company had no commitments from its actual controller, shareholders, related parties, acquirers, or the company that were fulfilled or overdue at the end of the reporting period[174] Related Party Fund Occupation No non-operating funds were occupied by controlling shareholders or other related parties during the reporting period - During the reporting period, the company had no non-operating occupation of funds by controlling shareholders or other related parties of the listed company[175] Illegal External Guarantees No illegal external guarantees occurred during the reporting period - The company had no illegal external guarantees during the reporting period[176] Accounting Firm Information The company's semi-annual financial report was not audited - The company's semi-annual report was not audited[177] Explanation of Non-Standard Audit Report No non-standard audit report was issued during the reporting period - The company had no non-standard audit report during the reporting period[178] Explanation of Last Year's Non-Standard Audit Report No non-standard audit report from the previous year was issued during the reporting period - The company had no non-standard audit report from the previous year during the reporting period[178] Bankruptcy Reorganization Matters No bankruptcy reorganization matters occurred during the reporting period - The company had no bankruptcy reorganization matters during the reporting period[178] Litigation Matters No significant litigation or arbitration matters occurred during the reporting period - The company had no significant litigation or arbitration matters during this reporting period[179] Penalties and Rectification No penalties or rectification situations occurred during the reporting period - The company had no penalties or rectification situations during the reporting period[180] Integrity Status No integrity issues were reported for the company, its controlling shareholder, or actual controller during the reporting period - The company had no integrity issues with its controlling shareholder or actual controller during the reporting period[181] Significant Related Party Transactions Routine related party transactions with Xinlong Vehicle Materials Industry Co., Ltd. for bicycle parts sales did not exceed approved limits Related Party Transactions Related to Daily Operations | Related Party | Related Party Relationship | Related Party Transaction Type | Related Party Transaction Content | Related Party Transaction Amount (CNY 10,000) | Proportion of Similar Transactions | Approved Transaction Limit (CNY 10,000) | Exceeded Approved Limit | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Xinlong Vehicle Materials Industry Co., Ltd. | Under common control by the same shareholder | Sales of products to related parties | Bicycle parts | 475.57 | 0.82% | 1,100 | No | - The company had no related party transactions involving asset or equity acquisition/disposal during the reporting period[182] - The company had no related party transactions involving joint external investment during the reporting period[183] - The company had no related party debt or credit transactions during the reporting period[184] - The company and its related financial companies had no deposits, loans, credit lines, or other financial business with related parties[185] Significant Contracts and Their Performance Taicang Xinlong Vehicle Materials Co., Ltd.'s factory lease contract with Maoxuan Intelligent Technology (Taicang) Co., Ltd. provides stable income Leasing Information | Lessor Name | Lessee Name | Leased Asset Description | Leased Asset Amount (CNY 10,000) | Lease Start Date | Lease End Date | Lease Income (CNY 10,000) | Impact of Lease Income on Company | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Taicang Xinlong Vehicle Materials Co., Ltd. | Maoxuan Intelligent Technology (Taicang) Co., Ltd. | Lease of all properties of Taicang Xinlong | 1,635.95 | 2020/03/01 | 2030/08/31 | 503.17 | Increases profit, continuous stable cash inflow | Company Guarantees for Subsidiaries | Guaranteed Entity Name | Guaranteed Amount (CNY 10,000) | Actual Guaranteed Amount (CNY 10,000) | Guarantee Period | Fulfilled | | :--- | :--- | :--- | :--- | :--- | | Tianjin Xinlong Industrial Co., Ltd. | 8,000 | 4,410 | 2 years | No | | Tianjin Xinlong Industrial Co., Ltd. | 3,500 | 2,500 | 2 years | No | | Tianjin Xinlong Industrial Co., Ltd. | 3,500 | 3,000 | 2 years | No | | Tianjin Xinlong Industrial Co., Ltd. | 3,000 | 2,000 | 2 years | No | | HLC Health Industry (Taicang) Co., Ltd. | 1,700 | 1,700 | 10 years | No | - During the reporting period, the total approved guarantee limit for subsidiaries was CNY 260 million, and the actual guarantee amount incurred for subsidiaries was CNY 132.4 million[192] - At the end of the reporting period, the total approved guarantee limit for subsidiaries was CNY 17 million, and the actual guarantee balance for subsidiaries was CNY 17 million[192] - The total actual guarantee amount (CNY 136.1 million) accounts for 15.90% of the company's net assets[192] - The company had no entrusted wealth management or other significant contracts during the reporting period[193][194] Explanation of Other Significant Matters Original shareholders of Wuhan Tianteng Power Technology Co., Ltd., Liu Han and Xiao Xuguo, failed to meet performance commitments for 2020 and 2021, owing the company CNY 17.6303 million in compensation - Original shareholders Liu Han and Xiao Xuguo of Wuhan Tianteng Power Technology Co., Ltd. failed to fulfill their performance commitments for 2020 and 2021, and should pay the company cash compensation totaling CNY 17.6303 million[197] - The company has signed an equity pledge agreement with Liu Han, the former actual controller and shareholder of Tianteng Power, pledging his 1.0232 million shares in Tianteng Power for the aforementioned performance compensation[197] - The company hired lawyers in January 2024 to initiate legal recovery procedures for the performance compensation, and the case was heard in the Bao'an District People's Court of Shenzhen in December 2024, but has since been transferred to the Shenzhen International Arbitration Court for arbitration on a later date due to jurisdiction objections[198] - At the end of 2023, the company made a single provision for bad debts of CNY 6.8459 million for the portion of the performance compensation not covered by pledged assets, based on the appraisal results of an appraisal institution[198] Significant Matters of Company Subsidiaries No significant matters occurred for the company's subsidiaries during the reporting period - The company's subsidiaries had no significant matters during the reporting period[199] Share Changes and Shareholder Information Share Changes The company's total share capital remained unchanged at 368,060,000 shares, with consistent restricted and unrestricted share proportions Share Changes | Share Class | Number of Shares Before Change | Percentage | Change (＋,－) | Number of Shares After Change | Percentage | | :--- | :--- | :--- | :--- | :--- | :--- | | I. Restricted Shares | 3,588,025 | 0.97% | 0 | 3,588,025 | 0.97% | | II. Unrestricted Shares | 364,471,975 | 99.03% | 0 | 364,471,975 | 99.03% | | III. Total Shares | 368,060,000 | 100.00% | 0 | 368,060,000 | 100.00% | - The company's total share capital remained unchanged during the reporting period[201] Securities Issuance and Listing No securities issuance or listing occurred during the reporting period - The company had no securities issuance or listing during the reporting period[202] Number of Shareholders and Shareholding At the end of the reporting period, the company had 45,864 common shareholders, with major holdings by Litian Development Co., Ltd. and FERNANDO CORPORATION - At the end of the reporting period, the total number of common shareholders was 45,864[203] Shareholding of Shareholders Holding 5% or More or Top 10 Shareholders | Shareholder Name | Shareholder Nature | Shareholding Percentage | Number of Shares Held at Period-End (shares) | Number of Unrestricted Shares Held (shares) | | :--- | :--- | :--- | :--- | :--- | | Litian Development Co., Ltd. | Overseas Legal Person | 41.98% | 154,522,500 | 154,522,500 | | FERNANDO CORPORATION | Overseas Legal Person | 5.69% | 20,926,447 | 20,926,447 | | Guosen Securities (Hong Kong) Asset Management Co., Ltd. - Liao Xuehong Special Account - RMB Inflow | Overseas Legal Person | 2.00% | 7,363,200 | 7,363,200 | - Liao Xuehong, a person acting in concert with controlling shareholder Litian Development Co., Ltd. and a company director, holds 7,363,200 shares through the "Guosen Securities (Hong Kong) Asset Management Co., Ltd. - Liao Xuehong Special Account - RMB Inflow" account[203] - At the 2024 Annual General Meeting, FERNANDO CORPORATION authorized Liao Xuejin to vote, with all votes being in favor[203] Changes in Shareholdings of Directors, Supervisors, and Senior Management No changes occurred in the shareholdings of the company's directors, supervisors, and senior management during the reporting period - The company's directors, supervisors, and senior management had no changes in their shareholdings during the reporting period[205] Changes in Controlling Shareholder or Actual Controller No changes occurred in the company's controlling shareholder or actual controller during the reporting period - The company's controlling shareholder did not change during the reporting period[206] - The company's actual controller did not change during the reporting period[206] Preferred Share Information The company had no preferred shares during the reporting period - The company had no preferred shares during the reporting period[207] Bond-Related Information Bond-Related Information No bond-related information for the company during the reporting period - The company had no bond-related information during the reporting period[209] Financial Report Audit Report The company's semi-annual financial report was not audited - The company's semi-annual financial report was not audited[211] Financial Statements This section presents the company's consolidated and parent company financial statements for H1 2025, detailing financial position, operating results, and cash flows - Consolidated balance sheet, parent company balance sheet, consolidated income statement, parent company income statement, consolidated cash flow statement, and parent company cash flow statement are provided[212][216][220][223][226][228] - Consolidated statement of changes in owners' equity and parent company statement of changes in owners' equity are provided[230][237] Company Basic Information Established in 2003 and listed in 2007, Shenzhen HLC Corp. has 368.06 million shares, headquartered in Shenzhen, focusing on bicycle parts and sports/rehabilitation equipment - Shenzhen HLC Corp. was established on December 15, 2003, with approval from the Ministry of Commerce of the People's Republic of China, and listed on the Shenzhen Stock Exchange on January 12, 2007[242] - As of December 31, 2024, the company's total share capital was 368.06 million shares, including 364.471975 million unrestricted shares and 3.588025 million restricted shares[244] - The company belongs to the sports goods manufacturing industry, with a business scope including R&D, production, and sales of sports equipment, rehabilitation aids, computer accessories, aluminum extrusion and forging (products), bicycle handlebars, stems, seat posts, suspension forks, and tube forming processing; it also produces and exports toys and children's bicycles, and provides general freight services[245] Basis of Financial Statement Preparation Financial statements are prepared on a going concern basis, adhering to accounting standards, with no significant doubts about continued operations - The company prepares its financial statements on a going concern basis, in accordance with the "Enterprise Accounting Standards" and relevant regulations issued by the Ministry of Finance, based on actual transactions and events[246] - The company has no matters or circumstances that would cause significant doubt about its ability to continue as a going concern for the 12 months from the end of the reporting period[247] Significant Accounting Policies and Accounting Estimates This section details the company's specific accounting policies and estimates for financial instruments, fixed assets, intangible assets, and revenue recognition, affirming compliance with accounting standards - The financial statements prepared by the company comply with the requirements of enterprise accounting standards, truthfully and completely reflecting the company's financial position, operating results, and cash flows[249] - The accounting year runs from January 1 to December 31 of the Gregorian calendar, and the company considers 12 months as one operating cycle[250][251] - The company and its domestic subsidiaries use RMB as their functional currency, while its overseas subsidiaries determine their functional currency based on the primary economic environment in which they operate[252] - Detailed explanations are provided for the accounting treatment methods for business combinations under common control and non-common control[256][257][258][259][260][261] - The criteria for determining control and the methods for preparing consolidated financial statements are elaborated[262][263][264][265][266][267][268][269] - Detailed explanations are provided for the classification, recognition criteria, measurement methods, and impairment treatment of financial instruments[277][278][279][280][281][282][283][284][285][286][287][288][289][290][291][292][293][294][295][296][297][298] - Detailed explanations are provided for the determination methods of expected credit losses for notes receivable, accounts receivable, accounts receivable financing, other receivables, and contract assets[300][301][302][303][304][305][306][307][308][309][310][311][312][313][314][315][316][317][318][319] - Detailed explanations are provided for inventory categories, issuance valuation methods, inventory systems, amortization methods for low-value consumables and packaging materials, and inventory impairment provisions[320][321][322][323][324][325] - Detailed explanations are provided for the recognition criteria, initial measurement, depreciation methods, and impairment of fixed assets[360][361][362][363][364][365] - Detailed explanations are provided for the useful life of intangible assets and its determination basis, estimation, amortization methods or review procedures, and the scope of R&D expenditure aggregation and related accounting treatment methods[374][375][376][377][378][379][380][381] - Detailed explanations are provided for the general principles of revenue recognition and the specific recognition principles for the company's domestic and export sales revenue[401][402][403][404][405][406][407] - Detailed explanations are provided for the classification, recognition timing, and accounting treatment of government grants[412][413][414][415][416][417][418][419][420] - Detailed explanations are provided for the recognition and measurement of deferred income tax assets and deferred income tax liabilities[421][422][423][424][425] - Detailed explanations are provided for the accounting treatment methods for leases as a lessee and as a lessor[426][427][428][429][430][431][432][433][434][435] Taxation The company's main taxes include VAT, urban maintenance and construction tax, corporate income tax, property tax, education surcharge, and local education surcharge Main Tax Categories and Rates | Tax Category | Tax Rate | | :--- | :--- | | Value-Added Tax (VAT) | Calculated at tax rates of 3%, 5%, 6%, 9%, 10%, 13%. Export goods are subject to "exemption, offset, and refund" policy, with a refund rate of 13%. | | Urban Maintenance and Construction Tax | 7% | | Corporate Income Tax | 25% | | Property Tax | 1.2%, 12% | | Education Surcharge | 3% | | Local Education Surcharge | 2% | - Shenzhen HLC Corp. enjoys corporate income tax incentives as a high-tech enterprise, taxed at a 15% rate (2023-2025)[447] - Xinyou Industrial (Vietnam) Co., Ltd. enjoys a "two-year exemption, four-year half reduction" incentive, with the current year being a tax half-reduction period, meaning it is taxed at a 10% income tax rate[447] - Xinlong Industrial (Hong Kong) Co., Ltd. is subject to a two-tiered profits tax rate of 8.25% and 16.5%[448] Notes to Consolidated Financial Statement Items This section details consolidated financial statement items, including cash, receivables, inventory, fixed assets, borrowings, payables, revenue, and costs Period-End Balance of Cash and Bank Balances | Item | Period-End Balance (CNY) | Period-Start Balance (CNY) | | :--- | :--- | :--- | | Cash on Hand | 355,075.39 | 299,243.31 | | Bank Deposits | 401,888,478.45 | 383,309,458.11 | | Other Cash and Bank Balances | 6,541.24 | 18,424.21 | | Total | 402,250,095.08 | 383,627,125.63 | | Of which: Total Amount of Funds Deposited Overseas | 75,697,015.98 | 88,464,578.11 | Period-End Balance of Accounts Receivable | Category | Period-End Book Balance (CNY) | Provision for Bad Debts (CNY) | Book Value (CNY) | | :--- | :--- | :--- | :--- | | Accounts receivable for which bad debt provisions are individually recognized | 18,289,999.49 | 18,289,999.49 | 0.00 | | Accounts receivable for which bad debt provisions are recognized in combination | 293,547,204.95 | 10,106,094.47 | 283,441,110.48 | | Total | 311,837,204.44 | 28,396,093.96 | 283,441,110.48 | Period-End Balance of Inventory Classification | Item | Book Balance (CNY) | Inventory Impairment Provision or Contract Performance Cost Impairment Provision (CNY) | Book Value (CNY) | | :--- | :--- | :--- | :--- | | Raw Materials | 55,476,153.03 | 5,104,255.15 | 50,371,897.88 | | Work in Progress | 45,808,899.10 | 767,585.07 | 45,041,314.03 | | Finished Goods | 66,273,641.42 | 8,942,445.80 | 57,331,195.62 | | Revolving Materials | 7,310,698.35 | 399,479.59 | 6,911,218.76 | | Contract Performance Costs | 31,278.30 | | 31,278.30 | | Goods in Transit | 8,359,220.81 | | 8,359,220.81 | | Total | 183,259,891.01 | 15,213,765.61 | 168,046,125.40 | Operating Revenue and Operating Costs | Item | Current Period Revenue (CNY) | Current Period Cost (CNY) | Prior Period Revenue (CNY) | Prior Period Cost (CNY) | | :--- | :--- | :--- | :--- | :--- | | Main Business | 569,269,064.10 | 498,384,295.45 | 519,824,316.80 | 437,380,827.16 | | Other Businesses | 12,303,880.92 | 9,923,642.63 | 12,861,046.44 | 6,134,246.59 | | Total | 581,572,945.02 | 508,307,938.08 | 532,685,363.24 | 443,515,073.75 | Financial Expenses | Item | Current Period Amount (CNY) | Prior Period Amount (CNY) | | :--- | :--- | :--- | | Interest Expense | 7,839,699.27 | 6,865,186.36 | | Interest Income | -3,384,467.98 | -4,057,452.25 | | Exchange Loss | 2,840,934.25 | 1,397,997.76 | | Exchange Gain | -7,046,395.32 | -6,609,715.87 | | Cash Discount | -249,601.19 | -155,791.52 | | Financial Institution Fees | 397,344.83 | 217,814.58 | | Amortization of Unrecognized Financing Costs | 332,102.96 | 455,814.10 | | Total | 729,616.82 | -1,886,146.84 | R&D Expenses Total R&D expenses were CNY 20.4031 million, all expensed, up 5.31% year-on-year, mainly for personnel, molds, testing, and depreciation R&D Expense Details | Item | Current Period Amount (CNY) | Prior Period Amount (CNY) | | :--- | :--- | :--- | | Employee Compensation | 13,199,065.18 | 12,110,578.35 | | Mold Fees | 1,551,043.68 | 1,302,144.27 | | Depreciation Expense | 1,334,175.05 | 1,322,902.87 | | Material Consumption | 589,992.59 | 674,639.94 | | R&D Testing Fees | 1,959,590.09 | 1,800,066.22 | | Inspection Fees | 111,333.58 | 54,663.67 | | Patent Fees | 109,959.40 | 238,774.56 | | Repair Fees | 270,290.53 | 242,111.46 | | Travel Expenses | 187,326.46 | 206,672.82 | | Share-based Payment | 113,583.30 | 283,958.22 | | Other | 976,735.67 | 1,137,179.50 | | Total | 20,403,095.53 | 19,373,691.88 | - All R&D expenses for the current period were expensed, with no capitalized R&D expenses[698] Changes in Consolidation Scope In August 2024, Shenzhen HLC Health Management Co., Ltd. was established and included in the consolidation scope, with the company holding 51% equity - In August 2024, the company, Shenzhen Zhongjile Investment Partnership (Limited Partnership), and Guangdong Yangfeng Technology Co., Ltd. jointly invested to establish Shenzhen HLC Health Management Co., Ltd., with the company contributing CNY 510,000, accounting for 51.00% of its registered capital, and possessing substantial control; therefore, it has been included in the scope of consolidated financial statements since its establishment[702] - As of June 30, 2025, Shenzhen HLC Health Management Co., Ltd.'s net assets were CNY 281,898.53, and its net profit for the reporting period was -CNY 211,579.86[702] - There were no reductions in subsidiaries due to other reasons, nor any mergers by absorption during the current period[703] Interests in Other Entities The company holds interests in numerous subsidiaries, including significant non-wholly owned subsidiary Vietnam Xinyou, and associate company Wuhan Tianteng Power Composition of Enterprise Group (Major Subsidiaries) | Subsidiary Name | Registered Capital (CNY) | Business Nature | Shareholding Percentage (Direct) | Shareholding Percentage (Indirect) | Acquisition Method | | :--- | :--- | :--- | :--- | :--- | :--- | | Shenzhen Xindie Technology Co., Ltd. | 5,320,000.00 | Manufacturing | 55.00% | | Established | | Tianjin Xinlong Industrial Co., Ltd. | 225,906,220.00 | Manufacturing | 100.00% | | Established | | Xinlong Industrial (Hong Kong) Co., Ltd. | 125,872,770.00 | Wholesale and Retail | 100.00% | | Established | | HLC Health Industry (Taicang) Co., Ltd. | 9,000,000.00 | Wholesale and Retail | 55.56% | 44.44% | Established | | Taicang Xinlong Vehicle Materials Co., Ltd. | 179,396,366.61 | Manufacturing | 75.00% | | Business combination under common control | | HL CORP(USA) | 9,104,150.00 | Wholesale and Retail | 51.00% | | Business combination under common control | | Shenzhen Leiqi Technology Co., Ltd. | 20,000,000.00 | Wholesale and Retail, Movable Property Leasing | 100.00% | | Established | | Shenzhen HLC Health Management Co., Ltd. | 1,000,000.00 | Health Management Services | 51.00% | | Established | | Xinyou Industrial (Vietnam) Co., Ltd. | 182,205,089.03 | Manufacturing | | 67.62% | Business combination not under common control | | Tianjin Ruimu Industrial Co., Ltd. | 50,000,000.00 | Manufacturing | | 100.00% | Established | Important Non-Wholly Owned Subsidiaries | Subsidiary Name | Minority Shareholding Percentage | Net Profit/Loss Attributable to Minority Shareholders (CNY) | Minority Interest Balance at Period-End (CNY) | | :--- | :--- | :--- | :--- | | Xinyou Industrial (Vietnam) Co., Ltd. | 32.38% | -1,913,846.78 | 42,540,511.49 | Key Financial Information of Important Associates (Wuhan Tianteng Power Technology Co., Ltd.) | Item | Period-End Balance/Current Period Amount (CNY) | Period-Start Balance/Prior Period Amount (CNY) | | :--- | :--- | :--- | | Current Assets | 52,891,887.96 | 84,308,889.32 | | Non-Current Assets | 54,175,368.93 | 58,067,843.38 | | Total Assets | 107,067,256.89 | 142,376,732.70 | | Current Liabilities | 60,419,865.41 | 81,997,972.34 | | Non-Current Liabilities | | | | Total Liabilities | 60,419,865.41 | 81,997,972.34 | | Minority Interest | | | | Equity Attributable to Parent Company Shareholders | 46,647,391.48 | 60,378,760.36 | | Net Asset Share Calculated by Shareholding Percentage | 5,845,198.04 | 7,565,820.95 | | Adjustments | | | | --Goodwill | | | | --Unrealized Profit from Internal Transactions | | | | --Other | | | | Carrying Amount of Equity Investment in Associates | 12,372,635.58 | 14,193,485.80 | | Fair Value of Equity Investment in Associates with Public Quotations | | | | Operating Revenue | 11,852,341.66 | 10,145,066.30 | | Net Profit | -13,983,289.96 | -20,329,482.19 | | Net Profit from Discontinued Operations | | | | Other Comprehensive Income | -281,079.39 | 45,866.30 | | Total Comprehensive Income | -14,264,369.35 | -47,128,170.79 | | Dividends Received from Associates in Current Year | | | Government Grants Government grants recognized in profit or loss totaled CNY 979,200, primarily for infrastructure and export credit insurance, with deferred income of CNY 11.8677 million Government Grants Recognized in Current Profit or Loss | Accounting Item | Current Period Amount (CNY) | Prior Period Amount (CNY) | | :--- | :--- | :--- | | Other Income | 979,165.46 | 1,231,264.73 | Liability Items Involving Government Grants (Deferred Income) | Accounting Item | Period-Start Balance (CNY) | New Grants Added in Current Period (CNY) | Amount Transferred to Other Income in Current Period (CNY) | Period-End Balance (CNY) | Related to Assets/Income | | :--- | :--- | :--- | :--- | :--- | :--- | | Deferred Income | 12,502,485.80 | 4,407,874.80 | 5,042,641.44 | 11,867,719.16 | Asset-related | Risks Related to Financial Instruments The company manages credit, market (foreign exchange, interest rate), and liquidity risks through diversification, credit assessment, hedging, and cash flow forecasting - The company faces various financial instrument risks in its daily operations, primarily including credit risk, market risk, and liquidity risk[721] - The company closely monitors the impact of exchange rate fluctuations on its exchange rate risk, matching foreign currency income with foreign currency expenditures as much as possible to reduce foreign exchange risk, and signing forward foreign exchange contracts to hedge against exchange rate risk[724] - The company's exposure to market interest rate changes primarily relates to its floating-rate borrowings, and it maintains an appropriate mix of fixed and floating-rate instruments through regular review and monitoring[725] - For receivables, the company manages credit risk concentration by customer, sets policies to control credit risk exposure, and regularly monitors debtors' credit records[727] - As of June 30, 2025, the company's asset-liability ratio was 43.62%[744] Disclosure of Fair Value Recurring fair value measured assets totaled CNY 25.0474 million, mainly bank acceptance bills, with other financial instruments' book values close to fair values Period-End Fair Value of Assets and Liabilities Measured at Fair Value | Item | Level 2 Fair Value Measurement (CNY) | Total (CNY) | | :--- | :--- | :--- | | Accounts Receivable Financing | 25,047,377.39 | 25,047,377.39 | | Total Assets Measured at Fair Value on a Recurring Basis | 25,047,377.39 | 25,047,377.39 | - Accounts receivable financing, primarily notes receivable, has a short remaining term, and its book value is close to its fair value, which is determined by th