元征科技(02488) - 2025 - 中期财报

Item I. Financial Data This section presents the Company's consolidated financial statements, including balance sheets, income statements, cash flow statements, and statements of changes in shareholders' equity Consolidated Balance Sheet Total assets grew 9% to 2,177,048 thousand RMB by June 30, 2025, driven by current asset and liability growth, while shareholders' equity slightly decreased | Metric | June 30, 2025 (thousand RMB) | December 31, 2024 (thousand RMB) | Change (%) | | :--- | :--- | :--- | :--- | | Total Assets | 2,177,048 | 1,996,672 | +9.04% | | Total Liabilities | 938,906 | 752,845 | +24.71% | | Total Shareholders' Equity | 1,238,142 | 1,243,827 | -0.46% | - Inventories within current assets increased from 212,769 thousand RMB to 313,527 thousand RMB (+47.35%), and accounts receivable increased from 307,419 thousand RMB to 336,794 thousand RMB (+9.56%)[3] - Short-term borrowings within current liabilities increased from 79,921 thousand RMB to 132,925 thousand RMB (+66.33%), and contract liabilities increased from 159,391 thousand RMB to 251,008 thousand RMB (+57.49%)[4] Consolidated Income Statement H1 2025 operating revenue grew 10% to 981,713 thousand RMB, with net profit up 28.47% due to revenue growth and reduced impairment losses | Metric | H1 2025 (thousand RMB) | H1 2024 (thousand RMB) | YoY Growth | | :--- | :--- | :--- | :--- | | Operating Revenue | 981,713 | 894,477 | 9.75% | | Net Profit | 196,019 | 152,582 | 28.47% | | Net Profit Attributable to Owners of the Parent Company | 194,736 | 152,453 | 27.74% | | Basic Earnings Per Share (RMB) | 0.469 | 0.367 | 27.79% | - Asset and credit impairment losses and fair value change losses significantly decreased from 52,823 thousand RMB in H1 2024 to 6,106 thousand RMB in H1 2025[5] Condensed Consolidated Cash Flow Statement H1 2025 saw increased operating cash inflow, expanded investing and financing outflows, leading to a net decrease in cash and cash equivalents | Cash Flow Activity | H1 2025 (thousand RMB) | H1 2024 (thousand RMB) | Change (thousand RMB) | | :--- | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | 189,159 | 71,052 | +118,107 | | Net Cash Flow from Investing Activities | (65,296) | (61,377) | -3,919 | | Net Cash Flow from Financing Activities | (150,766) | (107,441) | -43,325 | | Net Change in Cash and Cash Equivalents | (24,764) | (95,714) | +70,950 | | Cash and Cash Equivalents at Period-End | 515,319 | 515,018 | +301 | Condensed Consolidated Statement of Changes in Shareholders' Equity Total shareholders' equity slightly decreased in H1 2025, mainly due to share capital and capital reserve changes, despite growth in other comprehensive income and retained earnings - Total shareholders' equity at period-end was 1,238,142 thousand RMB, a slight decrease from 1,243,827 thousand RMB at the beginning of the period[7] - Share capital changed by (702) thousand RMB, and capital reserves changed by (25,661) thousand RMB[7] - Other comprehensive income changed by 11,377 thousand RMB, and retained earnings for the current period changed by 7,947 thousand RMB[7] Notes to the Consolidated Financial Statements This section details the Company's accounting policies, estimates, and methods for preparing consolidated financial statements, ensuring data accuracy and comparability 1. Basis of Preparation of Financial Statements Financial statements are prepared on a going concern basis, adhering to Chinese and Hong Kong accounting and disclosure standards, consistent with 2024 policies - Adheres to the Enterprise Accounting Standards and related regulations issued by the Ministry of Finance of China[8] - Complies with the China Securities Regulatory Commission's (CSRC) "No. 15 Rules for Information Disclosure by Companies Issuing Securities to the Public – General Provisions on Financial Reporting" (2023 Revision)[8] - Also complies with the disclosure requirements of the Hong Kong Companies Ordinance and the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[8] 2. Significant Accounting Policies, Accounting Estimates, and Methods of Preparation of Consolidated Financial Statements This section outlines the key accounting policies, estimates, and consolidation methods used to ensure accurate and comparable financial reporting (1) Accounting Period The reporting period covers the six months from January 1 to June 30, 2025 - This reporting period covers the six months from January 1 to June 30, 2025[9] (2) Functional Currency The Company uses RMB as its functional currency, with foreign subsidiaries converting their local currency financial statements to RMB - RMB is adopted as the functional currency[10] - Overseas subsidiaries use the currency of their primary economic environment as their functional currency, converting to RMB when preparing financial statements[10] (3) Method of Preparation of Consolidated Financial Statements All subsidiaries are included in the consolidated financial statements, with adjustments for inconsistent policies and elimination of intercompany transactions - All subsidiaries are included in the scope of consolidated financial statements[11] - When subsidiaries' accounting policies or periods are inconsistent with the Company's, adjustments are made to ensure consistency[11] - Intercompany transactions between the Company and its subsidiaries, and among subsidiaries, are eliminated during consolidation[11] 3. Operating Revenue Operating revenue primarily stems from automotive repair equipment sales and online software upgrade services, with main business revenue growing 9.1% year-over-year in H1 2025 - Main business revenue includes sales of automotive repair equipment and provision of online software purchase and upgrade services[12] | Revenue Type | H1 2025 (thousand RMB) | H1 2024 (thousand RMB) | YoY Growth | | :--- | :--- | :--- | :--- | | Main Business Revenue | 954,753 | 875,129 | 9.10% | | Other Business Revenue: Rental Income | 26,960 | 19,348 | 39.35% | | Total Operating Revenue | 981,713 | 894,477 | 9.75% | 4. Accounts Receivable Net accounts receivable reached 336,794 thousand RMB at period-end, an increase from year-start, with customer credit terms typically 30 to 210 days - Net accounts receivable was 336,794 thousand RMB, compared to 307,419 thousand RMB at the beginning of the year[15] - The Company primarily transacts with customers on credit terms ranging from 30 to 210 days[14] | Aging | Period-End Amount (thousand RMB) | Beginning-of-Year Amount (thousand RMB) | | :--- | :--- | :--- | | Within 1 year | 344,873 | 324,007 | | Over 1 year | 23,188 | 14,097 | | Total | 368,061 | 338,104 | 5. Inventories Total inventories at period-end were 313,527 thousand RMB, a significant increase from year-start, mainly due to higher finished goods and raw materials - Total inventories at period-end were 313,527 thousand RMB, up 47.35% from 212,769 thousand RMB at the beginning of the year[15] - Finished goods increased from 183,770 thousand RMB at the beginning of the year to 261,308 thousand RMB[15] - Raw materials increased from 12,680 thousand RMB at the beginning of the year to 32,067 thousand RMB[15] 6. Accounts Payable Total accounts payable at period-end was 249,830 thousand RMB, an increase from year-start, with most payables due within one year - Total accounts payable at period-end was 249,830 thousand RMB, compared to 201,537 thousand RMB at the beginning of the year[16] - Accounts payable due within one year accounted for 99.77% (249,270 thousand RMB) of the total[16] 7. Retained Earnings Retained earnings were 320,700 thousand RMB at period-end, reflecting net profit attributable to the parent company, partially offset by final dividend distribution - Retained earnings at period-end were 320,700 thousand RMB[17] - Net profit attributable to owners of the parent company for the current period was 194,736 thousand RMB[17] - A final dividend of 186,789 thousand RMB was distributed[17] 8. Asset and Credit Impairment Losses and Fair Value Change Losses H1 2025 saw a significant reduction in asset and credit impairment losses, with no material goodwill impairment due to strong overseas subsidiary performance - Asset and credit impairment losses and fair value change losses decreased from 52,823 thousand RMB in the same period last year to 6,106 thousand RMB in the current period[5][17] - Based on management's assessment, there were no significant credit impairment events related to accounts receivable during the period[17] - Due to the strong performance of overseas subsidiaries in H2 2024 and 2025, there was no significant asset impairment of goodwill for overseas subsidiaries during the period[17] 9. Income Tax Expense The Company and its subsidiaries are subject to varying income tax rates, from tax-exempt to 29.84%, reflecting diverse operating regions and business nature - The Company and Shenzhen Launch Software Development Co., Ltd. are subject to an income tax rate of 15.00%[19] - Launch Europe GmbH is subject to 19.00%, and Launch Italy GmbH is subject to 24.00%[19] - Launch Tech International Mena DMCC is subject to a 0.00% tax rate, and Shenzhen Yixinyiyi Software Development Co., Ltd. is tax-exempt[19] 10. Earnings Per Share Basic earnings per share for H1 2025 was 0.469 RMB, an increase from the prior year, with no dilutive ordinary shares outstanding (1) Basic Earnings Per Share This section details the calculation of basic earnings per share for the current and prior periods | Item | Current Year | Prior Year | | :--- | :--- | :--- | | Consolidated Net Profit Attributable to Ordinary Equity Holders of the Parent Company | 194,736 thousand RMB | 152,453 thousand RMB | | Weighted Average Number of Ordinary Shares Outstanding of the Parent Company | 415,554,267 shares | 415,788,100 shares | | Basic Earnings Per Share (RMB/share) | 0.469 | 0.367 | (2) Diluted Earnings Per Share No diluted earnings per share are presented as there were no dilutive potential ordinary shares in either period - Diluted earnings per share are not presented as there were no potential ordinary shares with dilutive effect in either 2025 or 2024[22] 11. Dividends The Board declared an interim dividend of RMB 0.31 per share for H1 2025, an increase from 2024, with distribution expected by September 12, 2025 - The Board resolved to declare an interim dividend of RMB 0.31 per share for the six months ended June 30, 2025[23] - The interim dividend for the same period in 2024 was RMB 0.20 per share[23] - Distribution is expected to be completed on or before September 12, 2025[23] 12. Contingent Liabilities As of the end of the reporting period, the Company had no material contingent liabilities - The Company had no material contingent liabilities at the end of the reporting period[24] 13. Asset Pledges As of June 30, 2025, the Company pledged land, buildings, and structures with an original value of approximately 264 million RMB as collateral for bank loans - The Company pledged land, buildings, and structures with an original value of approximately 264 million RMB as collateral for certain bank loans[25] 14. Capital and Lease Commitments As of June 30, 2025, the Company had no material capital and lease commitments - As of June 30, 2025, the Company had no material capital and lease commitments[26] 15. Post-Balance Sheet Events The Company has no material post-balance sheet events that require disclosure - The Company has no material post-balance sheet events that require disclosure[27] Item II. Management Discussion and Analysis This section offers a comprehensive review of the Company's financial performance, operational highlights, and strategic outlook for the reporting period H1 2025 Review In H1 2025, the Company achieved dual growth in revenue and net profit, driven by new strategies and significant progress in overseas business and software services Financials The Company achieved significant financial growth in H1 2025, with increased revenue, net profit, and improved cost control, driven by strong overseas performance and software sales - Operating revenue reached 982 million RMB, a year-over-year increase of approximately 10%; net profit was 196 million RMB, up 28% year-over-year; net profit margin was 20%, an increase of 3 percentage points year-over-year[29] - Overseas business (including overseas e-commerce) revenue was 746 million RMB, accounting for approximately 76% of total revenue, marking a historical high for the same period[29] - Customer software purchases amounted to 104 million RMB, a year-over-year increase of 28%; customer remote diagnostic service purchases amounted to 8.7 million RMB, up 53% year-over-year; data revenue was 7.9 million RMB, growing 61% year-over-year[29] - The cost-to-revenue ratio for main business decreased by 1 percentage point; the four expenses (management, R&D, selling, and financial expenses) accounted for approximately 30% of main business revenue, indicating continuous improvement in cost control[29] Customers The Company serves a broad customer base across the automotive industry, with a large global active user base and extensive diagnostic connections - Customers cover all segments of the automotive industry, including repair shops, mechanics, OEMs, car owners, automotive repair schools, insurance companies, and used car dealers[31] - The Company has cumulatively established connections with over 390 million vehicles globally through automotive diagnostic equipment, with over 3.5 million annual active diagnostic device terminals generating 1.05 million automotive diagnostic reports daily[31] - End-users are spread globally, with approximately 1.3 million annual active users in China and about 1 million in the US; 6,201 customer training sessions were held worldwide in the first half of the year[32] Internal Operations The Company launched three strategic initiatives—ADS, AAS, and EVS—to enhance intelligent diagnostics, AI-driven automotive services, and new energy vehicle services - Launched three major strategies: ADS (Intelligent Diagnostic Services), AAS (Intelligent Automotive Services), and EVS (New Energy Vehicle Services), achieving positive phased results[33] - ADS aims to enhance the intelligence of automotive diagnostics, enable full voice control of diagnostic hardware, build intelligent automotive fault analysis and prediction systems, and intensify overseas expansion efforts[33] - AAS utilizes large AI models, integrating multi-dimensional data and applying models like DeepSeek and Tongyi Qianwen to provide automotive AI services for car owners and repair shops, with the Launch AI automotive repair intelligent agent integrated into the diagnostic equipment workflow[33] - EVS targets new energy vehicles, selling new energy repair equipment through Launch EVS stations and providing repair bay modifications and after-sales services, with approximately 150 new energy stations established globally[33] Learning and Growth The Company continues to invest in innovation, securing new patents and maintaining a high proportion of R&D personnel - 21 authorized invention patents were obtained in the first half of the year[34] - As of June 30 this year, R&D personnel accounted for approximately 49% of the total workforce[34] Outlook and Future Strategies The Company aims to transform into a global automotive AI leader by integrating strengths, leveraging AI, and focusing on hardware, software, services, and data - With 30 years of focus and deep technological accumulation in automotive diagnostics, the Company will integrate its strengths, based on three major strategies, with hardware, software, services, and data as cornerstones, transforming from a manufacturing enterprise to an intelligent one[35] - Applying AI technology to the automotive industry, striving to become a global leading brand in automotive AI[35] - Future strategies include: increasing overseas business scale, expanding super remote diagnostic transaction volume, developing Launch AI, and significantly boosting revenue from the four core businesses; establishing digital and intelligent customer relationships; continuing to reduce operating and product costs by improving efficiency through AI and advanced tools; and attracting more strategic talent[36] Financial Analysis This section details the Company's financial position, including profitability, asset-liability structure, and cash flow, showing improved profitability but increased liabilities Profitability The Company's profitability improved in H1 2025, driven by increased sales and reduced impairment losses, leading to higher gross and net profit margins | Metric | Current Year | Prior Year | | :--- | :--- | :--- | | Main Business Gross Profit Margin | 48.0% | 47.3% | | Net Profit Margin | 20.0% | 17.1% | - H1 profit changes were primarily driven by a 48 million RMB increase in gross profit due to higher sales and a 47 million RMB reduction in asset and credit provisions, offsetting increases in operating, R&D, and financial expenses[37] - H1 revenue and gross profit increased, with the gross profit margin effectively rising to 48% and the net profit margin also increasing to 20%[38] Assets, Liabilities, and Shareholders' Equity Total assets increased by 9% due to higher receivables, inventories, and construction in progress, while total liabilities rose by 25% mainly from increased borrowings - Total assets were 2.177 billion RMB, an increase of 9% from the beginning of the year, primarily due to increases in accounts receivable, inventories, and construction in progress[40] - Total liabilities were 939 million RMB, an increase of 25% from the beginning of the year, mainly due to increased borrowings[40] - The leverage ratio (total liabilities/shareholders' equity) at period-end was 0.76 (beginning of period: 0.61)[40] Principal Sources and Uses of Funds This section details the Company's cash flows from operating, investing, and financing activities, outlining the primary sources and applications of funds Cash Flow from Operating Activities Net cash inflow from operating activities for the reporting period was 189 million RMB, primarily from sales and used for operational expenses - Net cash inflow from operating activities for the reporting period was 189 million RMB[42] - Cash inflows primarily originated from revenue from goods sales, while cash outflows were mainly for expenditures related to production and operating activities[42] Cash Flow from Investing Activities Net cash outflow from investing activities was 65 million RMB, mainly for property, equipment, R&D, and subsidiary acquisitions, funded primarily by internal resources - Net cash outflow from investing activities was 65 million RMB[43] - A portion was used for capital expenditures on commercial properties, equipment, and R&D, followed by cash paid for the acquisition of subsidiaries[43] - These expenditures were primarily funded by the Company's internal resources[43] Cash Flow from Financing Activities Net cash outflow from financing activities was 151 million RMB, mainly for dividend payments and bank loan repayments - Net cash outflow from financing activities was 151 million RMB[44] - Primarily for final dividend payments and repayment of bank loans[44] Item III. Other Significant Matters This section covers various non-financial but significant corporate matters, including changes in consolidation scope, audit committee reviews, and corporate governance 1. Scope of Consolidation There were no material changes to the Company's scope of consolidation during the reporting period - There were no material changes to the scope of consolidation during the reporting period[45] 2. Audit Committee Review of Interim Financial Report The Company's Board Audit Committee has reviewed and confirmed the 2025 interim financial report - The Company's Board Audit Committee has reviewed and confirmed the 2025 interim financial report[46] 3. Corporate Governance Code The Company consistently complied with the Corporate Governance Code provisions of the HKEX Listing Rules throughout the reporting period - The Company has consistently complied with the code provisions of the Corporate Governance Code, Appendix C1 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited, throughout the reporting period[47] 4. Model Code for Securities Transactions by Directors and Supervisors The Company adopted and complied with a code of conduct no less exacting than the Model Code, with all directors and supervisors adhering to it - The Company has adopted a standard code of conduct for securities transactions by directors and supervisors that is no less exacting than the Model Code set out in Appendix C3 of the Listing Rules[48] - Following specific inquiries with all directors and supervisors, the Company confirmed that each director and supervisor has complied with the standards for securities transactions by directors as set out in the Model Code for the six months ended June 30, 2025[48] 5. Pre-emptive Rights There are no pre-emptive rights provisions under the Company's articles or Chinese law requiring proportional new share offerings to existing shareholders - There are no provisions for pre-emptive rights under the Company's articles of association or Chinese law that require the Company to offer new shares proportionally to existing shareholders[49] 6. Customers and Suppliers Top five customers contributed 33% of revenue, top five suppliers 78% of purchases, with no director or major shareholder interests in them - The Company's top five customers contributed approximately 320 million RMB to total operating revenue for the period, representing about 33% of the total; the largest customer accounted for approximately 11% of total operating revenue for the period[50] - The Company's top five suppliers accounted for total purchases of approximately 494 million RMB, representing about 78% of total purchases for the period; the largest supplier accounted for approximately 29% of total purchases for the period[50] - No director, director's associate, or any shareholder (to the best of the Board's knowledge, owning more than 5% of the listed issuer's share capital) held any interest in the aforementioned customers or suppliers[50] 7. Share Capital The Company repurchased and cancelled H shares during the period, with no other share transactions or option grants by the Company or its subsidiaries - During the reporting period, save for the repurchase of 3,057,500 H shares and the cancellation of 701,500 H shares, neither the Company nor its subsidiaries purchased, sold, or redeemed any of the Company's shares, nor were any share options granted under a share option scheme[51] - The remaining 2,356,000 repurchased H shares were cancelled on July 16, 2025[51] Item IV. Interests of Directors, Supervisors, and Chief Executives in Securities This section details the equity interests and short positions held by the Company's directors, chief executives, and supervisors in the Company and its associated corporations (a) Interests and Short Positions of Directors, Chief Executives, and Supervisors in the Share Capital of the Company and its Associated Corporations Director Mr. Liu Xin held significant beneficial and controlled corporate interests in the Company's domestic shares, totaling 73.21% of issued domestic shares and 19.08% of all issued shares - Mr. Liu Xin held a beneficial owner interest in 79,200,000 domestic shares, representing 31.24% of the Company's issued domestic shares and 19.08% of all the Company's issued shares[52] - Mr. Liu Xin held additional domestic shares through controlled corporate interests, including 59,318,400 shares (23.39% of issued domestic shares), 11,938,200 shares (4.71%), and 35,160,000 shares (13.87%)[52] - Save as disclosed above, as of June 30, 2025, none of the Company's directors, chief executives, or supervisors had any personal, family, corporate, or other interests or short positions in the shares, debentures, or underlying shares of the Company or any of its associated corporations[53] (b) Persons and Substantial Shareholders with Interests or Short Positions Disclosable under Divisions 2 and 3 of Part XV of the Securities and Futures Ordinance Director Mr. Liu Xin indirectly held significant interests in the Company's domestic shares through his control over several entities - Mr. Liu Xin holds a 60.00% interest in Shenzhen Langqu Technology Development Co., Ltd., which holds approximately 23.39% of the Company's issued domestic shares, and Mr. Liu Xin is deemed to have an interest in these shares[54] - Mr. Liu Xin holds a 40.00% interest in Shenzhen Deshiyu Investment Co., Ltd., which holds approximately 4.71% of the Company's issued domestic shares, and Mr. Liu Xin is deemed to have an interest in these shares[54] - Shenzhen Yuanzhongchengyou Consulting Limited Partnership (controlled by Mr. Liu Xin) holds 35,160,000 domestic shares[54] Item V. Directors' Interests in Contracts and Connected Transactions This section confirms that no directors held material direct or indirect interests in any significant contracts or connected transactions with the Company or its subsidiaries during the reporting period - None of the Company's directors had any direct or indirect material interest in any significant contract entered into by the Company or its subsidiaries that was subsisting at the end of or at any time during the period ended June 30, 2025[56] Item VI. Interim Report and Other Information This section provides additional information related to the interim report, including the declaration of cash dividends and the composition of the Board of Directors Declaration of Cash Dividend The Board declared an interim cash dividend of RMB 0.31 per share, with H-share dividends payable in HKD, and announced specific arrangements including transfer registration suspension - The Board resolved to declare an interim cash dividend of RMB 0.31 per share (before applicable taxes)[58] - Dividends payable to H-share holders will be calculated in RMB and paid in HKD, at HKD 0.34 per share, with an exchange rate of RMB 0.9107 to HKD 1[59] - The declaration date is August 4, 2025. To determine the list of H-share shareholders entitled to the cash dividend, the Company will suspend H-share transfer registration from August 19, 2025, to August 22, 2025 (both dates inclusive), with the record date being August 22, 2025[59][60] By Order of the Board The Board issued this report on August 4, 2025, outlining its composition as of the report date - The date of this report is August 4, 2025[60] - The Company's Board of Directors comprises Executive Directors Mr. Liu Xin (Chairman), Mr. Liu Guozhu, Ms. Huang Zhaohuan, and Mr. Jiang Shiwen; Non-executive Director Mr. Peng Jian; and Independent Non-executive Directors Ms. Zhang Yanxiao, Mr. Bin Zhizhao, and Ms. He Xujin[60]