强泰环保(01395) - 2025 - 中期业绩

Financial Highlights Interim Results Announcement for the Six Months Ended June 30, 2025 Strongtech Environmental Holdings Limited announced unaudited interim results for the six months ended June 30, 2025, showing significant growth in revenue and gross profit, a turnaround to net profit, but no interim dividend declared | Indicator | Six Months Ended June 30, 2025 (Thousand HKD) | Six Months Ended June 30, 2024 (Thousand HKD) | Year-on-Year Change (%) | | :--- | :--- | :--- | :--- | | Operating Revenue | 80,800 | 45,700 | 76.8% | | Gross Profit | 38,800 | 20,700 | 87.9% | | Net Profit | 12,500 | (10,100) | Turnaround to Profit | - The Board resolved not to declare any dividend for the six months ended June 30, 2025[3] Condensed Consolidated Financial Statements Condensed Consolidated Statement of Profit or Loss The Group's condensed consolidated statement of profit or loss for the six months ended June 30, 2025, shows substantial revenue growth, significant gross profit increase, a turnaround to profit for the period, and basic earnings per share shifting from loss to profit | Indicator | Six Months Ended June 30, 2025 (Thousand HKD) | Six Months Ended June 30, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Operating Revenue | 80,802 | 45,694 | | Cost of Sales | (41,996) | (25,038) | | Gross Profit | 38,806 | 20,656 | | Administrative Expenses | (17,691) | (19,765) | | Finance Costs | (5,801) | (6,425) | | Profit/(Loss) Before Tax | 15,137 | (4,511) | | Income Tax Expense | (2,664) | (5,613) | | Profit/(Loss) for the Period | 12,473 | (10,124) | | Profit/(Loss) for the Period Attributable to Owners of the Company | 11,942 | (8,931) | | Basic Earnings/(Loss) Per Share (HK cents) | 1.08 | (0.81) | Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income The Group's condensed consolidated statement of profit or loss and other comprehensive income for the six months ended June 30, 2025, shows that profit for the period, combined with other comprehensive income (mainly from exchange differences on overseas operations), resulted in a total comprehensive income turning from a loss to a profit | Indicator | Six Months Ended June 30, 2025 (Thousand HKD) | Six Months Ended June 30, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Profit/(Loss) for the Period | 12,473 | (10,124) | | Fair Value Gain on Equity Instrument Investments | — | 813 | | Exchange Differences Arising from Translation of Overseas Operations | 8,632 | (19,240) | | Total Other Comprehensive Income/(Expense) for the Period | 9,445 | (19,240) | | Total Comprehensive Income/(Expense) for the Period | 21,918 | (29,364) | | Total Comprehensive Income/(Expense) for the Period Attributable to Owners of the Company | 21,295 | (28,296) | Condensed Consolidated Statement of Financial Position As of June 30, 2025, the Group's statement of financial position shows increases in non-current assets and current cash and cash equivalents, a rise in current liabilities, but also growth in total equity, reflecting a solid asset base and capital structure | Indicator | June 30, 2025 (Thousand HKD) | December 31, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Non-Current Assets | 404,973 | 389,322 | | Current Assets | 142,665 | 127,392 | | Current Liabilities | 130,680 | 110,942 | | Net Current Assets | 11,985 | 16,450 | | Total Equity | 274,723 | 252,805 | | Non-Current Liabilities | 142,235 | 152,967 | Notes to the Condensed Consolidated Financial Statements 1. General Information This section outlines Strongtech Environmental Holdings Limited's registration, listing, principal places of business, and core operations of its main subsidiaries, including wastewater treatment, biomass power generation, wood pellet sales, and IT services - The Company is an investment holding company, and its principal subsidiaries' businesses include the construction and operation of wastewater treatment facilities, construction and operation of biomass power plants, sales of wood pellets, and provision of information technology services[9] - The Company's shares are listed on The Stock Exchange of Hong Kong Limited, incorporated in the Cayman Islands, with its functional currency being HKD[9][10] 2. Basis of Preparation The condensed consolidated financial statements are prepared in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting" issued by the HKICPA and the disclosure requirements of the HKEX Listing Rules - The condensed consolidated financial statements are prepared in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting" issued by the Hong Kong Institute of Certified Public Accountants and the applicable disclosure requirements of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[11] 3. Accounting Policies The Group's condensed consolidated financial statements are primarily prepared on a historical cost basis, with accounting policies consistent with the previous year, and the application of HKFRS amendments in the current period has no significant impact on financial position and performance - The condensed consolidated financial statements are prepared on a historical cost basis, except for certain financial instruments measured at fair value[12] - The application of amendments to Hong Kong Financial Reporting Standards in this interim period has no significant impact on the Group's financial position and performance for the current and prior periods[13] 4. Operating Revenue The Group's total operating revenue significantly increased by 76.8% to HKD 80.8 million, primarily driven by strong growth in operational and construction services under service concession arrangements, and IT services, with a notable increase in contributions from Indonesia Operating Revenue by Type of Goods and Services | Type of Goods and Services | Six Months Ended June 30, 2025 (Thousand HKD) | Six Months Ended June 30, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Operational Services under Service Concession Arrangements | 40,096 | 17,757 | | Construction Services under Service Concession Arrangements | 17,794 | 9,416 | | Sales of Wood Pellets | 5,427 | 5,458 | | Information Technology Services | 8,389 | 3,932 | | Operating Revenue from Customer Contracts | 71,706 | 36,563 | | Imputed Interest Income from Receivables under Service Concession Arrangements | 9,096 | 9,131 | | Total Operating Revenue | 80,802 | 45,694 | Operating Revenue by Geographical Location | Geographical Location | Six Months Ended June 30, 2025 (Thousand HKD) | Six Months Ended June 30, 2024 (Thousand HKD) | | :--- | :--- | :--- | | China | 39,031 | 21,465 | | Indonesia | 41,771 | 24,229 | | Total Operating Revenue | 80,802 | 45,694 | 5. Segment Information The Group's segment analysis by geographical location shows China and Indonesia as primary revenue sources, with the Indonesian segment achieving significant profit in the first half of 2025, while the Hong Kong segment continued to record a loss - The Group's operating segments include the construction and operation of wastewater treatment facilities, construction and operation of biomass power plants, sales of wood pellets, and provision of information technology services, with principal operating regions being Hong Kong, China, and Indonesia[17] Segment Revenue and Profit (Loss) | Geographical Location | Six Months Ended June 30, 2025 (Thousand HKD) | Six Months Ended June 30, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Segment Revenue | | | | Hong Kong | — | — | | China | 39,031 | 21,465 | | Indonesia | 41,771 | 24,229 | | Total | 80,802 | 45,694 | | Segment (Loss)/Profit | | | | Hong Kong | (8,858) | (11,540) | | China | 13,688 | 11,403 | | Indonesia | 10,307 | (4,374) | | Profit/(Loss) Before Tax | 15,137 | (4,511) | 6. Other Income and Net Other Gains and Losses The Group's other income and net other gains and losses remained stable during the period, primarily comprising bank interest income and fair value gains on financial assets measured at fair value through profit or loss, but impacted by net exchange losses | Item | Six Months Ended June 30, 2025 (Thousand HKD) | Six Months Ended June 30, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Bank Interest Income | 312 | 306 | | Net Exchange (Loss)/Gain | (560) | 147 | | Fair Value Gain on Financial Assets Measured at Fair Value Through Profit or Loss | 513 | — | | Total | 977 | 1,023 | 7. Finance Costs The Group's finance costs decreased during the period, mainly due to reduced interest on borrowings and loans from related parties | Item | Six Months Ended June 30, 2025 (Thousand HKD) | Six Months Ended June 30, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Interest on Borrowings | 2,666 | 2,549 | | Interest on Loans from Related Parties | 3,123 | 3,437 | | Interest on Lease Liabilities | 12 | 11 | | Total | 5,801 | 6,425 | 8. Profit/(Loss) Before Tax This section lists the main expenses deducted/included in the calculation of profit/loss before tax, including staff costs, depreciation, and costs for construction and operational services | Item | Six Months Ended June 30, 2025 (Thousand HKD) | Six Months Ended June 30, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Staff Costs | 7,295 | 8,599 | | Depreciation of Property, Plant and Equipment | 2,731 | 2,673 | | Construction Service Costs | 15,545 | 8,313 | | Operational Service Costs | 20,055 | 7,163 | | Cost of Inventories Recognized as Expense | 5,979 | 6,446 | 9. Income Tax Expense The Group's income tax expense significantly decreased during the period, primarily due to a reduction in China corporate income tax and deferred tax, with some Chinese subsidiaries enjoying preferential tax rates | Item | Six Months Ended June 30, 2025 (Thousand HKD) | Six Months Ended June 30, 2024 (Thousand HKD) | | :--- | :--- | :--- | | China Corporate Income Tax | 2,915 | 3,802 | | Under-provision in Prior Years: China Corporate Income Tax | 101 | 809 | | Deferred Tax | (352) | 1,002 | | Total | 2,664 | 5,613 | - A Chinese subsidiary enjoys a preferential tax rate of 15% under relevant tax rules and regulations, valid until December 31, 2027[22] - The Group did not generate assessable profits in the Cayman Islands, British Virgin Islands, Hong Kong, and Indonesia, thus no income tax provision was made[21][22] 10. Dividends The Company's Board of Directors has decided not to pay any dividends for this interim period - No dividends were paid, declared, or proposed during the interim period[23] 11. Earnings/(Loss) Per Share Basic earnings per share attributable to owners of the Company turned from a loss to a profit compared to the previous year, and diluted earnings per share are the same as basic earnings per share due to the absence of potential ordinary shares | Indicator | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Profit/(Loss) for Basic Earnings Per Share (Thousand HKD) | 11,942 | (8,931) | | Weighted Average Number of Ordinary Shares (Thousand Shares) | 1,107,300 | 1,107,300 | | Basic Earnings/(Loss) Per Share (HK cents) | 1.08 | (0.81) | - As there are no outstanding potential ordinary shares, diluted earnings/(loss) per share are the same as basic earnings/(loss) per share[24] 12. Receivables under Service Concession Arrangements The Group's total receivables under service concession arrangements increased, with most being unbilled amounts, reflecting the nature of long-term contract assets | Item | June 30, 2025 (Thousand HKD) | December 31, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Receivables under Service Concession Arrangements | 373,976 | 364,193 | | Less: Portion Classified as Current Assets | (27,519) | (36,738) | | Portion Classified as Non-Current Assets | 346,457 | 327,455 | Ageing Analysis of Receivables under Service Concession Arrangements | Ageing | June 30, 2025 (Thousand HKD) | December 31, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Invoiced within 3 Months | 10,634 | 19,700 | | Unbilled | 363,342 | 344,493 | 13. Trade Receivables The Group's trade receivables remained stable and are all within the 0 to 60-day credit period, indicating effective collection management | Item | June 30, 2025 (Thousand HKD) | December 31, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Trade Receivables | 2,500 | 2,324 | | Less: Provision for Credit Losses | (47) | (47) | | Total | 2,453 | 2,277 | - The Group's policy is to grant credit terms of 30 to 60 days, and all trade receivables are within 0 to 60 days[26] 14. Trade Payables The Group's trade payables increased, primarily concentrated within 0 to 60 days, but with some amounts exceeding 90 days | Ageing | June 30, 2025 (Thousand HKD) | December 31, 2024 (Thousand HKD) | | :--- | :--- | :--- | | 0 to 60 Days | 5,509 | 3,382 | | 61 to 90 Days | 4 | — | | Over 90 Days | 885 | 140 | | Total | 6,398 | 3,522 | 15. Amounts Due to Related Parties The Group's total amounts due to related parties increased, mainly non-trade in nature, with most classified as non-current liabilities | Item | June 30, 2025 (Thousand HKD) | December 31, 2024 (Thousand HKD) | | :--- | :--- | :--- | | A Related Company | 36,409 | 34,810 | | A Close Family Member of a Shareholder | 22,790 | 21,235 | | A Close Family Member of a Director | 29,019 | 19,500 | | A Shareholder | 21,850 | 26,350 | | Total | 110,068 | 101,895 | | Less: Amounts Due within One Year and Classified as Current Liabilities | (30,329) | (7,261) | | Amounts Classified as Non-Current Liabilities | 79,739 | 94,634 | 16. Borrowings The Group's total borrowings slightly increased, consisting mainly of bank and other borrowings, with most classified as current liabilities due within one year | Item | June 30, 2025 (Thousand HKD) | December 31, 2024 (Thousand HKD) | | :--- | :--- | :--- | | Bank Borrowings | 73,708 | 75,392 | | Other Borrowings | 28,472 | 24,825 | | Total | 102,180 | 100,217 | | Less: Amounts Due within One Year and Classified as Current Liabilities | (82,708) | (84,392) | | Amounts Classified as Non-Current Liabilities | 19,472 | 15,825 | - During the interim period, HKD 2 million in bank borrowings were repaid, and HKD 3.557 million in new other borrowings were obtained[28] Management Discussion and Analysis Business Review The Group's business portfolio includes wastewater treatment, biomass power generation, data center operations, and wood pellet sales across China and Indonesia. During the period, Rugao wastewater treatment operated stably, with expansion slightly delayed; the Indonesian Bangka biomass power business fully operated and contributed significantly; data center management remained stable; and the wood pellet segment, while strategically important, saw slow progress in a proposed sale. Overall, operating revenue grew by 76.8%, and net profit turned from loss to profit - The Rugao wastewater treatment facility maintained stable operations, with its expansion project (daily treatment capacity increasing from 40,000 tons to 50,000 tons) slightly delayed due to environmental adjustments, now expected to be completed in the second half of 2025[29] - The Indonesian Bangka Island biomass power supply business commenced full operations in late July 2024, significantly contributing to the Group's operating revenue and profit under a 25-year fixed-price power purchase agreement[30] - The Group's data center management business continued stable operations, providing information technology management services and making a positive contribution to overall financial performance[32] - The Group's wood pellet segment remains strategically important, but the proposed sale of 80% of the RPSL business has been slow due to extended government approval processes, now expected to be completed in 2025[32] | Indicator | Six Months Ended June 30, 2025 (Million HKD) | Six Months Ended June 30, 2024 (Million HKD) | Year-on-Year Change (%) | | :--- | :--- | :--- | :--- | | Operating Revenue | 80.8 | 45.7 | 76.8% | | Net Profit | 12.5 | (10.1) | Turnaround to Profit | Future Outlook The Group expects to benefit from China's "14th Five-Year Plan" promoting industrial clusters and environmental governance, as well as Indonesia's continued support for biomass power through renewable energy policies. The Group is poised to capitalize on domestic and international policy opportunities for sustainable growth - Chinese development zones continue to advance the "14th Five-Year Plan," focusing on industrial cluster development, innovation capability enhancement, and environmental governance, creating a favorable environment for infrastructure operators like Rugao[34] - Recent policy developments in Indonesia regarding standardized renewable energy power purchase agreements and the 2060 Net Zero Emissions Energy Transition Roadmap strengthen the position of biomass power in the national energy mix[34] - The Group is well-prepared to fully seize opportunities arising from domestic and international policy support, with all business segments performing excellently, laying a solid foundation for sustainable growth[35] Financial Review The Group's financial performance significantly improved, with substantial growth in operating revenue and gross profit, reduced administrative and finance costs, ultimately achieving profit before tax and profit for the period attributable to owners of the Company, successfully reversing the loss from the same period last year Operating Revenue Total operating revenue for the period significantly increased by 76.8%, primarily driven by operational revenue from the Bangka Island biomass power plant in Indonesia and construction revenue from the Rugao expansion project - Total operating revenue increased by HKD 35.1 million or 76.8% from HKD 45.7 million in the same period last year to HKD 80.8 million in the current period[36] - The increase was primarily due to higher operating revenue generated by the Bangka Island biomass power plant and increased construction revenue from the expansion and upgrade of wastewater treatment facilities for the Rugao expansion project[36] Cost of Sales Total cost of sales increased by 67.7% year-on-year, mainly due to increased direct costs from the operation of the Bangka Island biomass power plant and construction costs from the Rugao expansion project - Total cost of sales increased by HKD 17.0 million or 67.7% from HKD 25.0 million in the same period last year to HKD 42.0 million in the current period[37] - Primarily due to increased direct costs from the operation of the Bangka Island biomass power plant and increased construction costs from the Rugao expansion project[37] Gross Profit and Gross Margin Gross profit significantly increased by 87.9%, and gross margin improved from 45.2% to 48.0%, reflecting enhanced profitability from business expansion and efficiency improvements - Gross profit increased by HKD 18.2 million or 87.9% from HKD 20.7 million in the same period last year to HKD 38.8 million in the current period[38] - Gross margin increased from 45.2% in the same period last year to 48.0% in the current period[38] Other Income and Net Other Gains and Losses Other income and net other gains for the period remained stable at HKD 1.0 million - Other income and net other gains remained stable at HKD 1.0 million in both the current period and the same period last year[39] Administrative Expenses Administrative expenses decreased by 10.5% year-on-year, primarily due to lower utility costs and staff costs - Administrative expenses decreased by HKD 2.1 million or 10.5% from HKD 19.8 million in the same period last year to HKD 17.7 million in the current period[40] - Primarily due to reduced utility costs and staff costs in the current period[40] Finance Costs Finance costs decreased by 9.7% year-on-year, mainly due to a lower weighted average interest rate on Bangka Island project loans and reduced amounts due to related parties - Finance costs decreased by HKD 0.6 million or 9.7% from HKD 6.4 million in the same period last year to HKD 5.8 million in the current period[41] - Primarily due to a decrease in the weighted average interest rate on loans borrowed for the Bangka Island project financing and reduced amounts due to related parties[41] Profit Before Tax The Group successfully reversed its profit before tax from a loss in the same period last year to a HKD 15.1 million profit in the current period - The Group recorded a profit before tax of HKD 15.1 million in the current period, compared to a loss before tax of HKD 4.5 million in the same period last year[42] Income Tax Expense Income tax expense decreased by 52.5% year-on-year, mainly due to a lower corporate income tax rate in Rugao and reduced deferred income tax for Indonesian subsidiaries - Income tax expense decreased by HKD 2.9 million or 52.5% from HKD 5.6 million in the same period last year to HKD 2.7 million in the current period[43] - Primarily due to a decrease in the corporate income tax rate charged to Rugao and reduced deferred income tax charged to Indonesian subsidiaries[43] Profit for the Period Attributable to Owners of the Company Profit for the period attributable to owners of the Company turned from a loss in the same period last year to a HKD 11.9 million profit, reflecting a significant improvement in overall financial performance - Profit for the period attributable to owners of the Company was HKD 11.9 million in the current period, compared to a loss of HKD 8.9 million attributable to owners of the Company in the same period last year[44] Liquidity, Financial and Capital Resources The Group maintains a healthy liquidity position with significantly increased bank balances and cash, and a reduced gearing ratio. Key capital needs focus on project investments and facility construction, managed through prudent treasury policies - Principal liquidity and capital requirements involve project investments, construction and upgrade of wastewater treatment facilities, equipment purchases, and operating and maintenance costs[45] - As of June 30, 2025, the Group's bank balances and cash amounted to HKD 52.0 million, an increase of 48.3% compared to December 31, 2024[45] Bank and Other Borrowings The Group's total utilized bank borrowings amounted to HKD 73.7 million, mostly repayable on demand or within one year, with additional borrowings from independent third parties and related parties at fair interest rates - As of June 30, 2025, total utilized bank borrowings amounted to HKD 73.7 million, of which HKD 46.8 million is repayable on demand and HKD 26.9 million is repayable within one year[46] - Outstanding bank borrowings are primarily denominated in HKD and RMB and bear interest at floating annual rates[46][47] - Outstanding borrowings from independent third parties amounted to HKD 28.5 million, bearing interest at annual rates of 7.8% to 8%[48] - Outstanding amounts due to related parties amounted to HKD 110.1 million, bearing interest at a fixed annual rate of 6%[48] Gearing Ratio The Group's gearing ratio decreased from 80.0% as of December 31, 2024, to 77.3% as of June 30, 2025, primarily due to increased retained earnings from net profit, strengthening equity - The gearing ratio decreased from 80.0% as of December 31, 2024, to 77.3% as of June 30, 2025[50] - The decrease was primarily due to the increase in the Group's retained earnings from higher net profit, strengthening the Group's equity[50] Pledge of Assets As of June 30, 2025, cash deposits of HKD 32.2 million were pledged as collateral for the Group's interest-bearing bank borrowings - As of June 30, 2025, cash deposits of HKD 32.2 million were pledged as collateral for the Group's interest-bearing bank borrowings[51] Treasury Policy The Group adopts a prudent financial management approach to its treasury policy, maintaining a healthy liquidity position throughout the period, with close monitoring by the Board to meet funding needs - The Group has adopted a prudent financial management approach to its treasury policy, maintaining a healthy liquidity position throughout the period[52] - The Board closely monitors the Group's liquidity position to ensure that the liquidity structure of its assets, liabilities, and other commitments can meet its funding requirements as they arise[52] Capital Expenditure Capital expenditure for the period amounted to HKD 20.3 million, primarily for the Rugao expansion project, Bangka Island project, and Indonesian biofuel pellet business, funded by the Group's financing activities - Capital expenditure for the period was HKD 20.3 million (same period last year: HKD 8.7 million), mainly comprising expenditures for the Rugao expansion project, Bangka Island project, and Indonesian biofuel pellet business[53] - Capital expenditure was funded by the Group's financing activities[53] Foreign Exchange Risk The Group faces limited foreign currency risk as most transactions of its Chinese and Indonesian subsidiaries are in their functional currencies, but HKD exchange rate fluctuations against RMB and IDR still impact consolidated financial position and are reflected in the exchange fluctuation reserve - Most transactions of the Group's Chinese and Indonesian member companies are conducted in their respective functional currencies, thus exposing the Group to only limited foreign currency risk[54] - Any appreciation or depreciation of the HKD against the RMB and IDR will impact the Group's consolidated financial position and be reflected in the exchange fluctuation reserve[54] - The Group does not have a foreign currency hedging policy and mitigates foreign exchange risk by converting cash and cash equivalents of overseas operating subsidiaries into HKD[54] Contingent Liabilities As of June 30, 2025, the Group had no significant contingent liabilities, except for those disclosed in the "Arbitration" section - As of June 30, 2025, the Group had no significant contingent liabilities (December 31, 2024: nil), except for those disclosed in the "Arbitration" section[55] Arbitration The Group is involved in an arbitration initiated by Hengfa Water Development Co., Ltd. with the Shenzhen International Arbitration Court concerning a dispute over the sale of a 70% equity stake in Haian Hengfa Wastewater Treatment Co., Ltd., with the award date delayed until before August 28, 2025 - Hengfa Water Development Co., Ltd. applied to the Shenzhen International Arbitration Court for arbitration against CGN Environmental Protection Industry Co., Ltd. regarding a dispute arising from the sale and purchase agreement for a 70% equity stake in Haian Hengfa Wastewater Treatment Co., Ltd[56] - Hengfa demanded payment of the third installment of the consideration under the sale and purchase agreement, RMB 13,633,200, plus total compensation for breach of contract, exchange losses, and legal fees of approximately RMB 2.2 million, and all arbitration costs[56] - The arbitration is ongoing, and the award date has been delayed until before August 28, 2025[57] Other Information Employees and Remuneration Policy As of June 30, 2025, the Group had 293 employees, with staff costs of approximately HKD 7.3 million. Remuneration policy is based on experience, responsibility, and market conditions, linked to Group profit performance and individual performance. The company's previous share option scheme expired on September 4, 2024, with no outstanding share options - As of June 30, 2025, the Group had 293 employees (December 31, 2024: 302 employees)[58] - Staff costs (including directors' emoluments) for the period were approximately HKD 7.3 million (same period last year: HKD 8.6 million)[58] - Remuneration policy is determined based on experience, responsibilities, and general market conditions, with discretionary bonuses and other incentives linked to the Group's profit performance and individual performance[58] - The Company's previous share option scheme expired on September 4, 2024, and no share options remain outstanding[58] Material Investments, Major Acquisitions and Disposals Except as disclosed in this announcement, the Group had no other material investments, major acquisitions, or disposals of assets, subsidiaries, associates, or joint ventures during the period - Except as disclosed in this announcement, the Group had no other material investments, major acquisitions, or disposals of assets, subsidiaries, associates, or joint ventures during the period[59] Future Plans for Material Investments or Capital Assets Except as disclosed in this announcement, as of the date of this announcement, the Group has no plans for other material investments or additions to capital assets - Except as disclosed in this announcement, as of the date of this announcement, the Group has no plans for other material investments or additions to capital assets[60] Events After Reporting Period The Group had no significant events after the end of the reporting period and up to the date of this announcement - The Group had no significant events after the end of the reporting period and up to the date of this announcement[61] Interim Dividend The Board of Directors resolved not to declare any interim dividend for the current period - At the Board meeting held on August 25, 2025, the Board resolved not to declare any interim dividend for the current period (same period last year: nil)[62] Corporate Governance The Company is committed to maintaining high standards of corporate governance and has applied and complied with the Corporate Governance Code set out in Appendix C1 of the Listing Rules throughout the period and up to the date of this announcement - The Company has applied and complied with the Corporate Governance Code set out in Appendix C1 of the Listing Rules throughout the period and up to the date of this announcement[63] Directors' Securities Transactions The Company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix C3 of the Listing Rules, and all Directors confirmed compliance with it during the period - The Company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix C3 of the Listing Rules, and following enquiry, all Directors confirmed compliance with the said code during the period[64] Purchase, Sale or Redemption of Shares During the period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities, and the Company held no treasury shares - During the period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[65] - As of June 30, 2025, the Company held no treasury shares[66] Review by Audit Committee The Company's Audit Committee has reviewed the accounting principles and practices adopted by the Group, as well as the unaudited interim results and this interim report for the period - The Audit Committee, comprising three independent non-executive directors, has reviewed with the Company's management the accounting principles and practices adopted by the Group, as well as the unaudited interim results and this interim report for the period[67] Publication of Interim Report The Company's 2025 interim report will be published on the HKEX and Company websites in due course, and distributed to shareholders - The Company's 2025 interim report will be published on the HKEX website (http://www.hkexnews.hk) and the Company's website (http://www.ellhk.com) in due course, and will be dispatched and sent to shareholders[68] Acknowledgements The Chairman of the Board extends sincere gratitude to all shareholders, directors, and staff for their continuous support and efforts - The Chairman of the Board extends sincere gratitude to all shareholders and stakeholders for their continuous support[69] - Appreciation is extended to all directors and staff for their dedicated and tireless efforts for the Group during the period[69] By Order of the Board This announcement is issued by the Board of Directors, represented by Chairman Zhou Andayuan, and lists the composition of the Board as of the announcement date - The Board comprises executive directors Zhou Andayuan (Chairman), Chen Kun (Chief Executive Officer), Chen Bailin, and Zhou Zhiren; non-executive director Su Jianren; and independent non-executive directors Wu Songen, Wu Wengong, and Liang Baoyi[71]