markdown [Financial Highlights](index=1&type=section&id=Financial%20Highlights) The company achieved revenue growth and significant profit increases in H1 2025, with a notable improvement in net profit margin Key Financial Data Comparison for H1 2025 vs H1 2024 | Metric | H1 2025 (HK$ thousand) | H1 2024 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 944,325 | 922,501 | 2.4% | | Gross Profit | 293,905 | 289,125 | 1.7% | | Profit for the Period | 56,154 | 48,636 | 15.5% | | Profit for the Period Attributable to Owners of the Company | 49,944 | 30,763 | 62.4% | | Adjusted Profit for the Period | 77,531 | 58,323 | 32.9% | | Adjusted Profit for the Period Attributable to Owners of the Company | 69,636 | 39,909 | 74.5% | | Gross Profit Margin (%) | 31.1% | 31.3% | (0.2) percentage points | | Net Profit Margin (%) | 5.9% | 5.3% | 0.6 percentage points | [Interim Condensed Consolidated Financial Statements](index=2&type=section&id=Interim%20Condensed%20Consolidated%20Financial%20Statements) This section presents the interim condensed consolidated financial statements, including comprehensive income and financial position, for the period [Interim Condensed Consolidated Statement of Comprehensive Income](index=2&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Comprehensive%20Income) For the six months ended June 30, 2025, the Group's revenue grew by **2.4%** to HK$**944.3 million**, and profit for the period increased by **15.5%** year-on-year to HK$**56.2 million**. Profit attributable to owners of the Company significantly rose by **62.4%** to HK$**49.9 million**, with basic earnings per share at HK$**0.0411** Interim Condensed Consolidated Statement of Comprehensive Income (For the six months ended June 30) | Metric | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Revenue | 944,325 | 922,501 | | Cost of Sales | (650,420) | (633,376) | | Gross Profit | 293,905 | 289,125 | | Other Income | 3,160 | 2,234 | | Selling Expenses | (63,486) | (60,640) | | Administrative Expenses | (165,413) | (159,356) | | Other Gains, Net | 13,091 | 2,060 | | Operating Profit | 81,257 | 73,423 | | Finance Income | 8,559 | 7,463 | | Finance Costs | (13,151) | (12,252) | | Net Finance Costs | (4,592) | (4,789) | | Share of Loss of Associates and Joint Ventures | (1,271) | (241) | | Profit Before Income Tax | 75,394 | 68,393 | | Income Tax Expense | (19,240) | (19,757) | | Profit for the Period | 56,154 | 48,636 | | Profit for the Period Attributable to Owners of the Company | 49,944 | 30,763 | | Profit for the Period Attributable to Non-controlling Interests | 6,210 | 17,873 | | Basic Earnings Per Share (HK cents) | 4.11 | 2.48 | - Total comprehensive income for the period significantly increased by **120.4%** to HK$**89.3 million**, mainly due to fair value changes of financial assets at fair value through other comprehensive income and foreign currency translation differences[4](index=4&type=chunk) [Interim Condensed Consolidated Statement of Financial Position](index=4&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the Group's total assets were HK$**2,762.7 million**, a slight increase from December 31, 2024. Total equity grew to HK$**1,939.4 million**, while total liabilities slightly decreased, indicating a stable financial position Interim Condensed Consolidated Statement of Financial Position (As of June 30) | Metric | June 30, 2025 (HK$ thousand) | December 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | **ASSETS** | | | | Non-current Assets | 2,127,481 | 2,079,677 | | Current Assets | 635,268 | 640,475 | | **TOTAL ASSETS** | **2,762,749** | **2,720,152** | | **EQUITY** | | | | Equity Attributable to Owners of the Company | 1,781,523 | 1,752,677 | | Non-controlling Interests | 157,905 | 137,234 | | **TOTAL EQUITY** | **1,939,428** | **1,889,911** | | **LIABILITIES** | | | | Non-current Liabilities | 403,127 | 420,219 | | Current Liabilities | 420,194 | 410,022 | | **TOTAL LIABILITIES** | **823,321** | **830,241** | | **TOTAL EQUITY AND LIABILITIES** | **2,762,749** | **2,720,152** | - Cash and cash equivalents within current assets decreased from HK$**423.1 million** to HK$**380.7 million**, while trade receivables increased from HK$**57.8 million** to HK$**66.7 million**[5](index=5&type=chunk) - Dividends payable within current liabilities increased from zero to HK$**24.1 million**, reflecting the declaration of the 2024 final dividend[6](index=6&type=chunk)[25](index=25&type=chunk) [Notes to the Financial Statements](index=6&type=section&id=Notes%20to%20the%20Financial%20Statements) This section provides detailed notes on the financial statements, covering general information, accounting policies, and specific financial items [1 General Information](index=6&type=section&id=1%20General%20Information) C-MER Medical Holdings Limited, incorporated in the Cayman Islands, primarily provides ophthalmic, dental, and other medical services and sells optical aids in Hong Kong and Mainland China, listed on the Main Board of the Stock Exchange of Hong Kong since January 15, 2018 - The Company's principal activities are providing ophthalmic, dental, and other medical services, and selling optical aids in Hong Kong and Mainland China[7](index=7&type=chunk) [2 Basis of Preparation](index=6&type=section&id=2%20Basis%20of%20Preparation) This interim condensed consolidated financial information is prepared in accordance with HKAS 34 'Interim Financial Reporting' issued by the HKICPA and should be read in conjunction with the annual consolidated financial statements for the year ended December 31, 2024 - The interim condensed consolidated financial information is unaudited and prepared in accordance with HKAS 34[8](index=8&type=chunk)[9](index=9&type=chunk) [3 Accounting Policies](index=7&type=section&id=3%20Accounting%20Policies) The Group's accounting policies are consistent with the 2024 annual consolidated financial statements, with new and revised standards adopted having no significant impact on the financial statements; management is assessing the potential impact of new standards not yet effective - The revised standards first adopted by the Group on January 1, 2025 (e.g., amendments to HKAS 21 and HKFRS 1) had no significant impact on accounting policies or financial statements[10](index=10&type=chunk)[11](index=11&type=chunk) - Several new and revised standards effective from 2026 or 2027 onwards are being assessed by management for potential financial impact, but no significant changes have been determined yet[12](index=12&type=chunk) [4 Revenue and Segment Information](index=8&type=section&id=4%20Revenue%20and%20Segment%20Information) The Group's revenue primarily derives from ophthalmic, dental, and other medical services, and sales of optical aids; management assesses performance based on four reportable segments: Hong Kong Medical Business, Mainland China Ophthalmic Business, Mainland China Dental Business, and Mainland China Other Business [Revenue Breakdown](index=8&type=section&id=4(a)%20Revenue) For the six months ended June 30, 2025, total revenue was HK$**944.3 million**, with ophthalmic services contributing the largest share at HK$**613.2 million**; most revenue is recognized at a point in time Revenue by Service Type (For the six months ended June 30) | Service Type | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Provision of Ophthalmic Services | 613,180 | 586,873 | | Provision of Dental Services | 237,479 | 246,400 | | Provision of Other Medical Services | 18,820 | 15,052 | | Sales of Optical Aids | 74,846 | 74,176 | | **Total Revenue** | **944,325** | **922,501** | | Revenue Recognition Timing | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Revenue Recognized at a Point in Time | 778,961 | 749,491 | | Revenue Recognized Over Time | 165,364 | 173,010 | | **Total Revenue** | **944,325** | **922,501** | [Segment Results](index=8&type=section&id=4(b)%20Segment%20Information) In H1 2025, Hong Kong Medical Business and Mainland China Ophthalmic Business achieved profit growth, while Mainland China Dental Business profit declined, and Mainland China Other Business (primarily Shenzhen C-MER Aierkangjian Hospital) remained in early operational stages, recording a gross loss Segment Results (For the six months ended June 30, 2025) | Segment | Segment Revenue (HK$ thousand) | Gross Profit / (Loss) (HK$ thousand) | Segment Results (HK$ thousand) | | :--- | :--- | :--- | :--- | | Hong Kong Medical Business | 467,069 | 134,387 | 50,950 | | Mainland China Ophthalmic Business | 254,815 | 95,737 | 1 | | Mainland China Dental Business | 217,062 | 72,929 | 33,179 | | Mainland China Other Business | 5,379 | (9,148) | (20,395) | | **Total** | **944,325** | **293,905** | **63,735** | Segment Results (For the six months ended June 30, 2024) | Segment | Segment Revenue (HK$ thousand) | Gross Profit (HK$ thousand) | Segment Results (HK$ thousand) | | :--- | :--- | :--- | :--- | | Hong Kong Medical Business | 427,052 | 113,166 | 45,921 | | Mainland China Ophthalmic Business | 270,761 | 89,660 | (22,954) | | Mainland China Dental Business | 224,688 | 86,299 | 54,073 | | Mainland China Other Business | – | – | (8,152) | | **Total** | **922,501** | **289,125** | **68,888** | - Mainland China ophthalmic business segment results improved from a loss of HK$**23.0 million** in H1 2024 to break-even in H1 2025[15](index=15&type=chunk)[16](index=16&type=chunk) [5 Other Income](index=11&type=section&id=5%20Other%20Income) Other income increased to HK$**3.2 million** in H1 2025, primarily driven by higher rental income, while management fee income and government grants decreased Other Income Breakdown (For the six months ended June 30) | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Management Fee Income | 535 | 1,045 | | Rental Income | 1,647 | 207 | | Government Grants | 141 | 225 | | Others | 837 | 757 | | **Total** | **3,160** | **2,234** | [6 Other Gains, Net](index=11&type=section&id=6%20Other%20Gains,%20Net) Other gains, net, significantly increased to HK$**13.1 million** in H1 2025, primarily due to gains on early termination of leases and net gains on disposal of property, plant and equipment Other Gains, Net Breakdown (For the six months ended June 30) | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Net Gain / (Loss) on Disposal of Property, Plant and Equipment | 2,288 | (286) | | Gain on Early Termination of Leases | 14,104 | 1,810 | | Fair Value (Loss) / Gain on Financial Assets at FVTPL | (101) | 1,621 | | Loss on Write-off of Non-current Assets | (2,002) | (1,421) | | Net Exchange Gain | 137 | 361 | | **Total** | **13,091** | **2,060** | [7 Cost of Sales, Selling and Administrative Expenses](index=12&type=section&id=7%20Cost%20of%20Sales,%20Selling%20and%20Administrative%20Expenses) Total cost of sales, selling and administrative expenses increased to HK$**879.3 million** in H1 2025, mainly due to higher doctors' fees, employee benefit expenses, and advertising and promotion expenses Total Cost of Sales, Selling and Administrative Expenses Breakdown (For the six months ended June 30) | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Amortisation of Intangible Assets | 529 | 682 | | Auditor's Remuneration | 1,156 | 1,178 | | Depreciation of Property, Plant and Equipment | 31,132 | 36,549 | | Depreciation of Investment Properties | 1,099 | 164 | | Depreciation of Right-of-use Assets | 65,203 | 71,236 | | Doctors' Fees | 209,006 | 187,570 | | Cost of Inventories and Consumables | 162,942 | 168,684 | | Employee Benefit Expenses | 270,820 | 271,387 | | Advertising and Promotion Expenses | 62,739 | 59,957 | | Legal and Professional Fees | 7,330 | 2,366 | | **Total** | **879,319** | **853,372** | [8 Net Finance Costs](index=12&type=section&id=8%20Net%20Finance%20Costs) Net finance costs slightly decreased to HK$**4.6 million** in H1 2025, primarily due to increased bank interest income and reduced interest expenses on lease liabilities, partially offset by higher interest expenses on bank loans Net Finance Costs Breakdown (For the six months ended June 30) | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Finance Income | 8,559 | 7,463 | | Finance Costs | (13,151) | (12,252) | | **Net Finance Costs** | **(4,592)** | **(4,789)** | [9 Income Tax Expense](index=13&type=section&id=9%20Income%20Tax%20Expense) Income tax expense decreased by **3.0%** to HK$**19.2 million** in H1 2025, primarily due to reduced taxable profit in Mainland China, partially offset by increased taxable profit in Hong Kong Income Tax Expense Breakdown (For the six months ended June 30) | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Current Income Tax - Hong Kong Profits Tax | 9,027 | 12,055 | | Current Income Tax - Mainland China Corporate Income Tax | 8,135 | 7,816 | | Under / (Over) Provision in Prior Years | 803 | (615) | | Deferred Income Tax | 1,275 | 501 | | **Income Tax Expense** | **19,240** | **19,757** | - Hong Kong profits tax rate is **16.5%**, and the applicable tax rate for Mainland China subsidiaries is **25%**[22](index=22&type=chunk) [10 Earnings Per Share](index=13&type=section&id=10%20Earnings%20Per%20Share) Basic earnings per share for H1 2025 was HK$**0.0411**, a significant increase from HK$**0.0248** in H1 2024, primarily due to the increase in profit attributable to owners of the Company Earnings Per Share Calculation (For the six months ended June 30) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Profit for the Period Attributable to Owners of the Company (HK$ thousand) | 49,944 | 30,763 | | Weighted Average Number of Ordinary Shares in Issue | 1,213,785,216 | 1,239,070,639 | | **Basic Earnings Per Share (HK cents)** | **4.11** | **2.48** | - Share options were not included in the calculation of diluted earnings per share as they had an anti-dilutive effect during the period[24](index=24&type=chunk) [11 Dividends](index=14&type=section&id=11%20Dividends) The Board does not recommend the payment of any interim dividend for the six months ended June 30, 2025. The 2024 final dividend of HK$**0.02** per ordinary share was paid on July 15, 2025 - The Board does not recommend the payment of any interim dividend for H1 2025[25](index=25&type=chunk) - The final dividend of HK$**0.02** per ordinary share for the year ended December 31, 2024, totaling HK$**24,069,198**, was paid on July 15, 2025[25](index=25&type=chunk) [12 Trade Receivables](index=14&type=section&id=12%20Trade%20Receivables) As of June 30, 2025, total trade receivables increased to HK$**66.7 million**, with the largest portion aged 0 to 90 days Trade Receivables Aging Analysis (As of June 30) | Aging | June 30, 2025 (HK$ thousand) | December 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | 0 to 90 days | 44,743 | 38,132 | | 91 to 180 days | 6,173 | 4,882 | | Over 180 days | 15,781 | 14,749 | | **Total** | **66,697** | **57,763** | [13 Trade Payables](index=14&type=section&id=13%20Trade%20Payables) As of June 30, 2025, total trade payables were HK$**57.4 million**, a slight increase from December 31, 2024, primarily concentrated in the 0 to 30-day aging category Trade Payables Aging Analysis (As of June 30) | Aging | June 30, 2025 (HK$ thousand) | December 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | 0 to 30 days | 42,824 | 33,350 | | 31 to 60 days | 6,187 | 11,338 | | 61 to 90 days | 5,653 | 6,952 | | Over 90 days | 2,687 | 4,170 | | **Total** | **57,351** | **55,810** | [Management Discussion and Analysis](index=15&type=section&id=Management%20Discussion%20and%20Analysis) This section offers management's perspective on the Group's performance, operational highlights, and strategic outlook for the period [Business Review Overview](index=15&type=section&id=Business%20Review%20Overview) In H1 2025, the Group's profitability improved, driven by revenue growth, service network optimization, and enhanced operational efficiency; adjusted profit attributable to owners of the Company significantly increased by **74.5%**, and Mainland China ophthalmic business achieved break-even - Adjusted profit for the period attributable to owners of the Company (excluding losses from Mainland China Other Business segment) increased by **74.5%** from HK$**39.9 million** in H1 2024 to HK$**69.6 million**[28](index=28&type=chunk) - Total revenue slightly increased by **2.4%** to HK$**944.3 million**, driven by growth in Hong Kong ophthalmic services, partially offset by reduced revenue from Shenzhen dental and ophthalmic services due to intense competition[29](index=29&type=chunk) - Net cash generated from operating activities was HK$**108.1 million**, a decrease from the prior period, primarily due to increased working capital used in operations[29](index=29&type=chunk) [Hong Kong Business](index=16&type=section&id=Hong%20Kong%20Business) Hong Kong business, operating under the 'C-MER Dennis Lam' brand, provides ophthalmic services and has expanded into dental, oncology, and other medical services, with an ophthalmic network including five day surgery centers, eight satellite clinics, and eight optometry centers - Hong Kong ophthalmic service network includes five day surgery centers, eight satellite clinics, and eight optometry centers, offering comprehensive ophthalmic and optometric services[31](index=31&type=chunk) - Since 2021, Hong Kong business has expanded to dental, oncology, and other medical services, comprising six dental clinics, two general clinics, and one oncology center as of June 30, 2025[32](index=32&type=chunk) [Mainland China Business](index=16&type=section&id=Mainland%20China%20Business) Mainland China ophthalmic service network covers multiple cities, achieving break-even through organizational optimization; Shenzhen dental business faces intense competition leading to revenue decline but is actively expanding its service network through expansions and new clinics; Shenzhen C-MER Aierkangjian Hospital is fully operational but remains in an early loss-making stage - Mainland China ophthalmic service network includes nine ophthalmic hospitals, achieving break-even in H1 2025, reversing the loss from the prior period[33](index=33&type=chunk) - Shenzhen Aierkangjian dental business revenue decreased by **3.4%** to HK$**217.1 million** due to intense market competition, but is actively expanding, including the expansion of Luohu Dental Hospital and new clinics in Futian and Liantang Port[34](index=34&type=chunk)[35](index=35&type=chunk) - Shenzhen C-MER Aierkangjian Hospital became fully operational in H1 2025, offering multi-specialty Hong Kong-style medical services, but incurred a loss of HK$**15.1 million** due to its early stage of operation[36](index=36&type=chunk) [Revenue Analysis](index=17&type=section&id=Revenue%20Analysis) Total revenue in H1 2025 slightly increased by **2.4%** to HK$**944.3 million**; Hong Kong Medical Business revenue grew by **9.4%**, while Mainland China ophthalmic and dental business revenues decreased by **5.9%** and **3.4%** respectively, primarily due to market competition and weak consumption [By Business Segment](index=18&type=section&id=By%20Business%20Segment) Hong Kong Medical Business revenue share increased to **49.5%**, growing by **9.4%**; Mainland China ophthalmic and dental business revenue shares decreased, declining by **5.9%** and **3.4%** respectively; Mainland China Other Business began contributing revenue Revenue by Segment (For the six months ended June 30) | Segment | 2025 (HK$ thousand) | 2025 (%) | 2024 (HK$ thousand) | 2024 (%) | Change (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Hong Kong Medical Business | 467,069 | 49.5 | 427,052 | 46.2 | 40,017 | 9.4 | | Mainland China Ophthalmic Business | 254,815 | 27.0 | 270,761 | 29.4 | (15,946) | (5.9) | | Mainland China Dental Business | 217,062 | 23.0 | 224,688 | 24.4 | (7,626) | (3.4) | | Mainland China Other Business | 5,379 | 0.5 | – | – | 5,379 | N/A | | **Total** | **944,325** | **100.0** | **922,501** | **100.0** | **21,824** | **2.4** | [By Service Type](index=20&type=section&id=By%20Service%20Type) Revenue from ophthalmic services grew by **4.5%**, accounting for **65.0%** of total revenue; dental service revenue decreased by **3.6%**, and other medical services revenue increased by **25.0%** Revenue by Service Type (For the six months ended June 30) | Service Type | 2025 (HK$ thousand) | 2025 (%) | 2024 (HK$ thousand) | 2024 (%) | Change (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Provision of Ophthalmic Services | 613,180 | 65.0 | 586,873 | 63.7 | 26,307 | 4.5 | | Provision of Dental Services | 237,479 | 25.1 | 246,400 | 26.7 | (8,921) | (3.6) | | Provision of Other Medical Services | 18,820 | 2.0 | 15,052 | 1.6 | 3,768 | 25.0 | | Sales of Optical Aids | 74,846 | 7.9 | 74,176 | 8.0 | 670 | 0.9 | | **Total** | **944,325** | **100.0** | **922,501** | **100.0** | **21,824** | **2.4** | [By Geographical Market](index=21&type=section&id=By%20Geographical%20Market) Hong Kong market revenue share increased from **46.3%** to **49.5%**, growing by **9.4%**; Mainland China revenue share decreased from **53.7%** to **50.5%**, a **3.7%** decline, mainly due to reduced ophthalmic and dental service revenue Revenue by Geographical Market (For the six months ended June 30) | Geographical Market | 2025 (HK$ thousand) | 2025 (%) | 2024 (HK$ thousand) | 2024 (%) | Change (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Hong Kong | 467,069 | 49.5 | 427,052 | 46.3 | 40,017 | 9.4 | | Mainland China | 477,256 | 50.5 | 495,449 | 53.7 | (18,193) | (3.7) | | **Total** | **944,325** | **100.0** | **922,501** | **100.0** | **21,824** | **2.4** | [Ophthalmic Services Analysis](index=21&type=section&id=Ophthalmic%20Services%20Analysis) Ophthalmic service revenue grew by **4.5%**, with increases in consultation and surgery fees in Hong Kong, while Mainland China saw a decrease; average surgery fees in Hong Kong increased by **12.4%**, and Mainland China's average surgery fees decreased by **8.5%** (HK$ denominated) Ophthalmic Service Revenue by Category and Region (For the six months ended June 30) | Category | Region | 2025 (HK$ thousand) | 2025 (%) | 2024 (HK$ thousand) | 2024 (%) | Change (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Consultation and Other Medical Service Fees | Hong Kong | 168,768 | 27.5 | 153,592 | 26.2 | 15,176 | 9.9 | | | Mainland China | 67,165 | 11.0 | 73,685 | 12.5 | (6,520) | (8.8) | | Surgery Fees | Hong Kong | 241,932 | 39.4 | 219,760 | 37.5 | 22,172 | 10.1 | | | Mainland China | 135,315 | 22.1 | 139,836 | 23.8 | (4,521) | (3.2) | | **Total** | | **613,180** | **100.0** | **586,873** | **100.0** | **26,307** | **4.5** | Ophthalmic Surgery Data (For the six months ended June 30) | Metric | Region | 2025 | 2024 | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Total Surgery Fees (HK$ thousand) | Hong Kong | 241,932 | 219,760 | 10.1 | | | Mainland China | 135,315 | 139,836 | (3.2) | | Number of Surgeries | Hong Kong | 7,492 | 7,646 | (2.0) | | | Mainland China | 13,639 | 12,894 | 5.8 | | Average Surgery Fee (HK$) | Hong Kong | 32,292 | 28,742 | 12.4 | | | Mainland China | 9,921 | 10,845 | (8.5) | | Average Surgery Fee (RMB denominated) | Mainland China | - | - | (8.0) | [Dental Services Analysis](index=23&type=section&id=Dental%20Services%20Analysis) Total dental service revenue decreased by **3.6%** to HK$**237.5 million**; despite a **7.4%** increase in total patient visits, patient visits and revenue per dental chair both declined, reflecting intense competition in the Shenzhen market Dental Services Data (For the six months ended June 30) | Metric | 2025 | 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Total Dental Service Revenue (HK$ thousand) | 237,479 | 246,400 | (3.6) | | Total Patient Visits | 167,599 | 156,080 | 7.4 | | Total Dental Chairs | 278 | 244 | 13.9 | | Patient Visits per Dental Chair | 603 | 640 | (5.8) | | Revenue per Dental Chair (HK$ thousand) | 854 | 1,010 | (15.4) | [Other Medical Services and Sales of Optical Aids](index=23&type=section&id=Other%20Medical%20Services%20and%20Sales%20of%20Optical%20Aids) Other medical services revenue grew by **25.0%** to HK$**18.8 million**; sales of optical aids revenue slightly increased by **0.9%** to HK$**74.8 million** - Revenue from oncology, medical aesthetics, general practice, and other services was approximately HK$**18.8 million**, a year-on-year increase of **25.0%**[54](index=54&type=chunk) - Revenue from sales of optical aids was HK$**74.8 million**, a year-on-year increase of **0.9%**[55](index=55&type=chunk) [Cost and Profit Analysis](index=24&type=section&id=Cost%20and%20Profit%20Analysis) The Group's total cost of sales, selling and administrative expenses increased, but gross profit and profit for the period still grew due to operational optimization; gross profit margin slightly decreased, but net profit margin improved [Cost of Sales](index=24&type=section&id=Cost%20of%20Sales) Total cost of sales increased by **2.7%** to HK$**650.4 million**, primarily due to higher doctors' fees paid to Hong Kong ophthalmologists Cost of Sales Breakdown (For the six months ended June 30) | Item | 2025 (HK$ thousand) | 2025 % of Revenue | 2024 (HK$ thousand) | 2024 % of Revenue | Change (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Doctors' Fees | 209,006 | 22.1 | 187,570 | 20.3 | 21,436 | 11.4 | | Cost of Inventories and Consumables | 162,942 | 17.3 | 168,684 | 18.3 | (5,742) | (3.4) | | Staff Salaries and Allowances | 178,058 | 18.9 | 177,525 | 19.2 | 533 | 0.3 | | Depreciation of Right-of-use Assets | 46,571 | 4.9 | 43,611 | 4.7 | 2,960 | 6.8 | | Depreciation of Property, Plant and Equipment | 22,596 | 2.4 | 26,046 | 2.8 | (3,450) | (13.2) | | Others | 31,247 | 3.3 | 29,940 | 3.2 | 1,307 | 4.4 | | **Total** | **650,420** | **68.9** | **633,376** | **68.7** | **17,044** | **2.7** | [Gross Profit and Gross Profit Margin](index=25&type=section&id=Gross%20Profit%20and%20Gross%20Profit%20Margin) Gross profit increased by **1.7%** to HK$**293.9 million**, but gross profit margin slightly decreased by **0.2** percentage points to **31.1%**; gross profit margins for Hong Kong Medical Business and Mainland China Ophthalmic Business increased, while Mainland China Dental Business's gross profit margin decreased Gross Profit and Gross Profit Margin by Segment (For the six months ended June 30) | Segment | 2025 Gross Profit (HK$ thousand) | 2025 Gross Profit Margin (%) | 2024 Gross Profit (HK$ thousand) | 2024 Gross Profit Margin (%) | Change (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Hong Kong Medical Business | 134,387 | 28.8 | 113,166 | 26.5 | 21,221 | 18.8 | | Mainland China Ophthalmic Business | 95,737 | 37.6 | 89,660 | 33.1 | 6,077 | 6.8 | | Mainland China Dental Business | 72,929 | 33.6 | 86,299 | 38.4 | (13,370) | (15.5) | | Mainland China Other Business | (9,148) | N/A | – | N/A | (9,148) | – | | **Total** | **293,905** | **31.1** | **289,125** | **31.3** | **4,780** | **1.7** | [Selling and Administrative Expenses](index=25&type=section&id=Selling%20and%20Administrative%20Expenses) Selling expenses increased by **4.8%** to HK$**63.5 million**, mainly due to increased promotion expenses for Mainland China dental services; administrative expenses grew by **3.8%** to HK$**165.4 million**, primarily impacted by expenses from the full operation of Luohu Hospital - Selling expenses as a percentage of total revenue increased from **6.6%** to **6.7%**, mainly due to increased promotion expenses for Mainland China dental services[60](index=60&type=chunk) - The increase in administrative expenses was primarily due to expenses incurred from the full operation of Luohu Hospital[61](index=61&type=chunk) [Other Income and Net Gains](index=26&type=section&id=Other%20Income%20and%20Net%20Gains) Other income increased to HK$**3.2 million**, primarily from rental income; other gains, net, significantly rose to HK$**13.1 million**, mainly due to gains on early termination of leases - Other income, mainly comprising management fee income and rental income, increased from HK$**2.2 million** to HK$**3.2 million**[62](index=62&type=chunk) - Other gains, net, amounted to HK$**13.1 million**, primarily including gains on early termination of leases[63](index=63&type=chunk) [Net Finance Expenses and Income Tax](index=26&type=section&id=Net%20Finance%20Expenses%20and%20Income%20Tax) Net finance costs decreased to HK$**4.6 million**, primarily due to the net effect of increased bank interest income and reduced interest expenses on lease liabilities; income tax expense decreased by **3.0%** to HK$**19.2 million**, mainly due to reduced taxable profit in Mainland China - Net finance costs decreased to HK$**4.6 million**, mainly due to increased interest income from bank deposits and reduced interest expenses on lease liabilities[64](index=64&type=chunk) - Income tax expense decreased by **3.0%** to HK$**19.2 million**, primarily due to reduced taxable profit in Mainland China, partially offset by increased taxable profit in Hong Kong[65](index=65&type=chunk) [Profit for the Period](index=26&type=section&id=Profit%20for%20the%20Period) Profit for the period increased to HK$**56.2 million**, primarily benefiting from revenue growth and the strategic effectiveness of service network optimization and operational efficiency improvements - Profit for H1 2025 was HK$**56.2 million**, an increase from HK$**48.6 million** in the prior period, mainly attributable to revenue growth and improved operational efficiency[66](index=66&type=chunk) [Cash Flow Analysis](index=27&type=section&id=Cash%20Flow%20Analysis) Net cash from operating activities decreased to HK$**108.1 million**, mainly due to increased working capital; net cash used in investing activities decreased, while net cash used in financing activities increased, primarily for share repurchases and lease payments - Net cash generated from operating activities was HK$**108.1 million**, a decrease from the prior period, primarily due to increased working capital used in operations[67](index=67&type=chunk) - Net cash used in investing activities was HK$**46.1 million**, primarily for the purchase of property, plant and equipment[67](index=67&type=chunk) - Net cash used in financing activities was HK$**110.7 million**, primarily including HK$**29.1 million** for share repurchases and HK$**71.4 million** for lease payments[67](index=67&type=chunk) [Outlook and Strategies](index=27&type=section&id=Outlook%20and%20Strategies) The Group anticipates strong demand for ophthalmic services in Hong Kong, while Mainland China ophthalmic business faces challenges; strategies include focusing on ophthalmic services in Hong Kong and core Mainland cities, developing cross-border dental medical services in Shenzhen, and investing in innovative businesses to explore opportunities - Demand for ophthalmic services in Hong Kong remains strong, while Mainland China ophthalmic business faces challenges due to changing consumption patterns[69](index=69&type=chunk) - Strategies include focusing on ophthalmic services in Hong Kong and core cities in Mainland China, developing cross-border dental medical business under Shenzhen Aierkangjian, and developing multi-specialty hospitals in Luohu[70](index=70&type=chunk) - Will continue to improve operational efficiency and service capabilities, implement strict cost control for Mainland China ophthalmic business, and invest in innovative businesses that contribute professional expertise[74](index=74&type=chunk) [Other Information](index=28&type=section&id=Other%20Information) This section covers additional corporate information, including dividends, investments, corporate governance, and securities transactions [Interim Dividend](index=28&type=section&id=Interim%20Dividend) The Board does not recommend the payment of any interim dividend for the six months ended June 30, 2025 - The Board does not recommend the payment of any interim dividend for H1 2025[71](index=71&type=chunk) [Material Investments, Acquisitions and Disposals](index=28&type=section&id=Material%20Investments,%20Acquisitions%20and%20Disposals) In H1 2025, the Group made no material investments, acquisitions, or disposals - The Group made no material investments, acquisitions, or disposals in H1 2025[72](index=72&type=chunk) [Corporate Governance](index=28&type=section&id=Corporate%20Governance) The Company has complied with all applicable provisions of the Corporate Governance Code in Appendix C1 of the Listing Rules; effective June 1, 2025, the roles of Chairman and Chief Executive Officer were separated, with Dr. Ouyang Boquan as Chairman and Ms. Li Xiaoting as CEO, restoring compliance with the code - The Company has complied with all applicable provisions of the Corporate Governance Code in Appendix C1 of the Listing Rules, with a previous deviation from Rule C.2.1 (roles of Chairman and Chief Executive should be separate)[73](index=73&type=chunk) - Effective June 1, 2025, Dr. Ouyang Boquan was appointed Chairman and Ms. Li Xiaoting was appointed Chief Executive Officer, bringing the Company back into compliance with Rule C.2.1[73](index=73&type=chunk) [Standard Code for Securities Transactions](index=29&type=section&id=Standard%20Code%20for%20Securities%20Transactions) The Company has adopted the Model Code for Securities Transactions in Appendix C3 of the Listing Rules as a code of conduct for directors and relevant employees' securities transactions, and complied with it during H1 2025 - The Company has adopted and complied with the Model Code for Securities Transactions in Appendix C3 of the Listing Rules, with all directors and relevant employees complying during H1 2025[75](index=75&type=chunk) [Purchase, Sale or Redemption of Listed Securities](index=29&type=section&id=Purchase,%20Sale%20or%20Redemption%20of%20Listed%20Securities) In H1 2025, the Company repurchased **17,370,000** ordinary shares on the Stock Exchange for a total consideration of approximately HK$**29.1 million**, aiming to enhance net asset value per share and/or earnings per share; as of the announcement date, the Company holds **8,730,000** repurchased shares as treasury shares 2025 H1 Share Repurchase Details | Month of Repurchase | Number of Shares Repurchased | Highest Price Paid per Share (HK$) | Lowest Price Paid per Share (HK$) | Total Consideration Paid (HK$) | | :--- | :--- | :--- | :--- | :--- | | 2025年1月 | 2,020,000 | 1.97 | 1.84 | 3,869,755 | | 2025年2月 | 688,000 | 2.07 | 1.96 | 1,393,873 | | 2025年3月 | 2,496,000 | 1.61 | 1.54 | 3,921,813 | | 2025年4月 | 4,124,000 | 1.68 | 1.34 | 6,006,651 | | 2025年5月 | 3,462,000 | 1.77 | 1.68 | 5,951,348 | | 2025年6月 | 4,580,000 | 1.82 | 1.66 | 7,965,318 | | **Total** | **17,370,000** | | | **29,108,758** | - The Board believes share repurchases are in the best interest of the Company and shareholders, enhancing net asset value per share and/or earnings per share[77](index=77&type=chunk) - As of the announcement date, the Company holds **8,730,000** repurchased shares as treasury shares, with an intention to resell depending on market conditions[77](index=77&type=chunk) [Audit Committee and Review of Interim Results](index=30&type=section&id=Audit%20Committee%20and%20Review%20of%20Interim%20Results) The Audit Committee has reviewed the Group's accounting principles, risk management, internal controls, and financial reporting matters, and reviewed the unaudited interim condensed consolidated financial information for H1 2025; PricewaterhouseCoopers has reviewed the financial information in accordance with Hong Kong Standard on Review Engagements - The Audit Committee, comprising three independent non-executive directors, has reviewed the Group's accounting principles, risk management, internal controls, and financial reporting matters[80](index=80&type=chunk) - The Group's unaudited interim condensed consolidated financial information has been reviewed by PricewaterhouseCoopers in accordance with Hong Kong Standard on Review Engagements 2410[80](index=80&type=chunk) [Publication of Interim Results Announcement and Interim Report](index=30&type=section&id=Publication%20of%20Interim%20Results%20Announcement%20and%20Interim%20Report) This interim results announcement has been published on the Stock Exchange and Company websites; the H1 2025 interim report will be dispatched to shareholders in due course and will be available on the Stock Exchange and Company websites - This interim results announcement has been published on the Stock Exchange website (www.hkexnews.hk) and the Company's website (www.cmermedical.com)[81](index=81&type=chunk) - The Company's H1 2025 interim report will be dispatched to shareholders in due course and will be available on the Stock Exchange and Company websites[81](index=81&type=chunk)
希玛医疗(03309) - 2025 - 中期业绩