金利来集团(00533) - 2025 - 中期财报

Chairman's Report Operating Results The Group's first-half 2025 operating results shifted from profit to loss, with a 19% decline in total turnover driven by sales downturns, increased fair value losses on investment properties, and reduced gross margins Turnover The Group's total turnover for the first half of 2025 was HK$487,111,000, a 19% decrease year-on-year, with all major business revenues experiencing varying degrees of decline Turnover Comparison | Metric | H1 2025 (HK$ thousand) | H1 2024 (HK$ thousand) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Total Turnover | 487,111 | 603,261 | -19% | Cost of Sales and Gross Profit Total cost of sales for the period was HK$198,157,000, with apparel cost of sales decreasing by 22%, leading to a 25% drop in gross profit, while the gross profit margin before inventory impairment slightly declined to 56% Cost of Sales and Gross Profit Comparison | Metric | H1 2025 (HK$ thousand) | H1 2024 (HK$ thousand) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Total Cost of Sales | 198,157 | 241,390 | -17.9% | | Apparel Cost of Sales | 147,454 | 189,561 | -22% | | Apparel Sales Gross Profit (before inventory impairment) | 187,551 | 249,771 | -25% | | Gross Profit Margin before Inventory Impairment | 56% | 56.9% | -0.9 percentage points | | Inventory Impairment Provision | 8,501 | 12,350 | -31.2% | | Cost of Properties Sold | 23,179 | 21,079 | +9.9% | | Property Sales Gross Profit Margin | 17.2% | 25.6% | -8.4 percentage points | | Direct Operating Expenses for Investment Properties | 18,239 | 17,596 | +3.6% | Other Losses The Group recorded a fair value loss on investment properties of HK$22,953,000 for the period, representing a 16% increase compared to the prior year Fair Value Loss on Investment Properties | Metric | H1 2025 (HK$ thousand) | H1 2024 (HK$ thousand) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Fair Value Loss on Investment Properties | 22,953 | 19,818 | +15.8% | Operating Expenses Distribution and marketing costs remained similar to the prior year, while administrative expenses decreased by 5%, with distribution and marketing costs not significantly declining despite reduced sales Operating Expenses Comparison | Metric | H1 2025 (HK$ thousand) | H1 2024 (HK$ thousand) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Distribution and Marketing Costs | 205,734 | 207,764 | -1% | | Administrative Expenses | 74,415 | 78,365 | -5% | Operating (Loss)/Profit The Group recorded an operating loss of HK$14,148,000 for the period, compared to an operating profit of HK$55,924,000 in the prior year, resulting in an operating loss margin of approximately 2.9% Operating (Loss)/Profit Comparison | Metric | H1 2025 (HK$ thousand) | H1 2024 (HK$ thousand) | Y-o-Y Change | | :--- | :--- | :--- | :--- | | Operating (Loss)/Profit | (14,148) | 55,924 | Shift from profit to loss | | Operating (Loss)/Profit Margin | -2.9% | 9.3% | -12.2 percentage points | (Loss)/Profit Attributable to Owners of the Company The Group reported a loss attributable to owners of the Company of HK$3,960,000 for the period, compared to a profit of HK$58,233,000 in the prior year, with profit excluding fair value loss on investment properties (net of tax) decreasing by approximately 79% to HK$15,575,000 (Loss)/Profit Attributable to Owners of the Company Comparison | Metric | H1 2025 (HK$ thousand) | H1 2024 (HK$ thousand) | Y-o-Y Change | | :--- | :--- | :--- | :--- | | (Loss)/Profit Attributable to Owners of the Company | (3,960) | 58,233 | Shift from profit to loss | | Profit excluding fair value loss on investment properties (net of tax) | 15,575 | 73,478 | -78.8% | | Net Interest Income | 11,592 | 12,215 | -5.1% | | Income Tax Expense | 1,388 | 9,899 | -86% | | Effective Tax Rate (excluding fair value loss on investment properties and its tax impact) | 23.6% | 16.5% | +7.1 percentage points | Overview of Operating Results for H1 2025 | Metric | H1 2025 (HK$ thousand) | H1 2024 (HK$ thousand) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Total Turnover | 487,111 | 603,261 | -19% | | Cost of Sales | 198,157 | 241,390 | -17.9% | | Gross Profit | 288,954 | 361,871 | -20.1% | | Operating (Loss)/Profit | (14,148) | 55,924 | Shift from profit to loss | | (Loss)/Profit Attributable to Owners of the Company | (3,960) | 58,233 | Shift from profit to loss | - Persistent macroeconomic uncertainties continue to impact the consumer market, especially the traditional menswear industry, leading to a challenging operating environment for the Group[2] Business Review The Group's apparel business faced severe challenges in mainland China and Hong Kong with significant sales declines, while the Singapore market underperformed, property investment saw reduced rental income, and the Meixian property development experienced slow sales, though domestic photovoltaic business recorded a slight profit Apparel Business Overall apparel turnover in mainland China and Hong Kong markets decreased by approximately 24%, with wholesale sales down 50%, self-operated retail same-store sales down 12%, and e-commerce sales down 14%, while Singapore apparel sales fell by 8% and recorded increased losses Apparel Business Sales Comparison for Mainland China and Hong Kong | Business Type | H1 2025 (HK$ thousand) | Y-o-Y Change (%) | | :--- | :--- | :--- | | Domestic Apparel Overall Turnover | 317,924 | -24% | | Wholesale Sales (RMB) | N/A | -50% | | Self-operated Retail Sales (RMB) | N/A | +11% | | Self-operated Retail Same-store Sales | N/A | -12% | | Outlet Store Sales (RMB) | N/A | -30% | | E-commerce Sales (RMB) | N/A | -14% | | Group Customization Sales | N/A | -57% | | Operating Rights Income | 31,659 | -22% | Singapore Apparel Business Comparison | Metric | H1 2025 (HK$ thousand) | H1 2024 (HK$ thousand) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Apparel Sales | 17,081 | 18,535 | -8% | | Decline in Local Currency | N/A | N/A | -11% | | Gross Profit Margin before Inventory Impairment | 52% | 54% | -2 percentage points | | Inventory Impairment Provision | 870 | 236 | +268% | | Local Apparel Business Loss | 3,461 | 2,337 | +48.1% | - In domestic apparel sales channels, wholesale business accounted for approximately 20%, self-operated retail for 28%, and e-commerce for 34%[10][11] Property Investment and Development The investment property portfolio value was approximately HK$2,658,006,000, slightly higher due to RMB appreciation, with a fair value loss of HK$22,953,000 primarily from domestic properties, while total rental and property management fee income decreased by 3% due to rising vacancy rates, and the Meixian property development experienced slow sales Key Data for Property Investment and Development | Metric | H1 2025 (HK$ thousand) | H1 2024 (HK$ thousand) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Investment Property Portfolio Value | 2,658,006 | 2,604,529 (Year-end) | +2.05% | | Fair Value Loss on Investment Properties | 22,953 | 19,818 | +15.8% | | Total Rental and Property Management Fee Income | 91,672 | 94,869 | -3.4% | | Guangzhou 'Goldlion Digital Network Centre' Occupancy Rate | 77% | 81% | -4 percentage points | | Meixian 'Goldlion Garden' Property Sales Revenue | 27,987 | N/A | N/A | | Meixian 'Goldlion Garden' Property Sales Gross Profit | 4,808 | N/A | N/A | - The occupancy rate of Goldlion Group Centre in Sha Tin, Hong Kong, decreased from 89% to 86%, while the property at 3 Yuk Yat Street, To Kwa Wan, saw its occupancy rate fall to 89%[15] Domestic Photovoltaic Business The Group's domestic photovoltaic business recorded electricity sales revenue of HK$788,000 and a slight profit during the period Domestic Photovoltaic Business Revenue | Metric | H1 2025 (HK$ thousand) | | :--- | :--- | | Electricity Sales Revenue | 788 | - Apparel businesses in mainland China and Hong Kong face intense competition, consumption downgrades, and market structural shifts[9] - Singapore's apparel business underperformed due to a weak external economy and slowing private consumption growth[12] - The property investment market faces a severe environment, with rising vacancy rates in some properties leading to a decline in rental and property management income[13] Outlook The operating environment for the second half of 2025 is expected to remain challenging with slow recovery in domestic consumer confidence and ongoing property market adjustments, prompting the Group to optimize domestic apparel operations, enhance Singapore business, launch a snooker apparel series, and improve property leasing and sales in Meixian - Domestic consumer confidence is expected to recover slowly, and the property market adjustment continues, indicating a persistently challenging operating outlook[17] - The Group will optimize product quality, integrate distribution networks, and strengthen self-operated retail capabilities for its domestic apparel business[17] - A snooker apparel series will be launched and promoted through collaborations with relevant sports associations and event sponsorships[17] - The property investment business will focus on improving leasing conditions for Goldlion Digital Network Centre and other properties, and flexibly market the remaining units of Goldlion Garden in Meixian[17] Financial Position As of June 30, 2025, the Group's cash and bank balances increased by HK$79,759,000 to approximately HK$1,131,605,000, demonstrating a robust financial position with zero bank loans, overdrafts, and a liquidity ratio of 6.1 Key Financial Position Data | Metric | June 30, 2025 (HK$ thousand) | Year-end (HK$ thousand) | Change (HK$ thousand) | | :--- | :--- | :--- | :--- | | Cash and Bank Balances | 1,131,605 | 1,051,846 | +79,759 | | Net Cash Inflow from Operating Activities | 91,295 | N/A | N/A | | Current Assets | 2,205,077 | N/A | N/A | | Current Liabilities | 360,786 | N/A | N/A | | Current Ratio | 6.1 | N/A | N/A | | Debt-to-Asset Ratio | 0 | N/A | N/A | - The Group has no bank loans or overdrafts, and its debt-to-asset ratio is zero, indicating a very healthy financial position[18] - The Group provided mortgage loan guarantees of HK$3,991,000 for certain property buyers, with the Board deeming the net realizable value of the properties sufficient to cover any defaults, thus no provision was made[19] Acknowledgements The Chairman, on behalf of the Board, extends gratitude to all staff for their hard work and contributions to the Group Review Report on Interim Financial Information Introduction PricewaterhouseCoopers has reviewed the interim condensed consolidated financial information of Goldlion Holdings Limited and its subsidiaries for the six months ended June 30, 2025, in accordance with HKFRS 34 and the HKEX Listing Rules - The auditor has reviewed the interim financial information and confirmed its compliance with relevant accounting standards and listing rule requirements[23] Scope of Review The review was conducted in accordance with HKSRE 2410, which is significantly narrower in scope than an audit, thus no audit opinion is expressed, nor is assurance provided that all material matters will be identified - The scope of review is narrower than an audit, and no audit opinion is expressed[24] Conclusion The auditor found no matters suggesting that the Group's interim financial information was not prepared in all material respects in accordance with HKFRS 34 'Interim Financial Reporting' - The auditor believes the interim financial information complies in all material respects with HKFRS 34[25] Interim Condensed Consolidated Financial Statements Interim Condensed Consolidated Statement of Financial Position As of June 30, 2025, the Group's total assets increased slightly to HK$5,242,929,000 from year-end 2024, driven by higher investment property values, increased completed properties and bank deposits, and reduced inventories and trade receivables Key Balance Sheet Data (HK$ thousand) | Metric | June 30, 2025 | December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Total Assets | 5,242,929 | 5,146,477 | +96,452 | | Non-current Assets | 3,037,852 | 2,946,059 | +91,793 | | Investment Properties | 2,658,006 | 2,604,529 | +53,477 | | Current Assets | 2,205,077 | 2,200,418 | +4,659 | | Completed Properties Held for Sale | 774,482 | 590,795 | +183,687 | | Inventories | 153,826 | 217,723 | -63,897 | | Trade Receivables | 52,370 | 88,669 | -36,299 | | Bank Deposits | 925,077 | 734,144 | +190,933 | | Cash and Cash Equivalents | 205,950 | 316,392 | -110,442 | | Total Equity | 4,435,484 | 4,349,283 | +86,201 | | Total Liabilities | 807,445 | 797,194 | +10,251 | | Current Liabilities | 360,786 | 387,118 | -26,332 | | Trade Payables | 16,894 | 49,557 | -32,663 | Interim Condensed Consolidated Statement of Profit or Loss The Group's H1 2025 turnover decreased by 19% to HK$487,111,000, with gross profit down 20.1%, resulting in an operating loss of HK$14,148,000 and a loss attributable to owners of HK$3,960,000, or HK$0.41 cents per share Key Income Statement Data (HK$ thousand) | Metric | H1 2025 | H1 2024 | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Turnover | 487,111 | 603,261 | -19.2% | | Cost of Sales | (198,157) | (241,390) | -17.9% | | Gross Profit | 288,954 | 361,871 | -20.1% | | Other Losses | (22,953) | (19,818) | +15.8% | | Distribution and Marketing Costs | (205,734) | (207,764) | -1.0% | | Administrative Expenses | (74,415) | (78,365) | -5.0% | | Operating (Loss)/Profit | (14,148) | 55,924 | Shift from profit to loss | | (Loss)/Profit Before Income Tax | (2,556) | 68,139 | Shift from profit to loss | | Income Tax Expense | (1,388) | (9,899) | -86.0% | | (Loss)/Profit for the Period | (3,944) | 58,240 | Shift from profit to loss | | (Loss)/Profit Attributable to Owners of the Company | (3,960) | 58,233 | Shift from profit to loss | | (Loss)/Earnings Per Share (HK cents) | (0.41) | 5.98 | Shift from profit to loss | Interim Condensed Consolidated Statement of Comprehensive Income The Group recorded a loss for the period of HK$3,944,000 in H1 2025, but total comprehensive income turned positive to HK$86,201,000 due to other comprehensive income of HK$90,145,000, primarily from exchange differences on translating financial statements of mainland China and overseas subsidiaries Key Comprehensive Income Statement Data (HK$ thousand) | Metric | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | | (Loss)/Profit for the Period | (3,944) | 58,240 | Shift from profit to loss | | Other Comprehensive Income | 90,145 | (67,000) | Shift from loss to profit | | - Exchange differences | 76,651 | (74,436) | Shift from loss to profit | | Total Comprehensive Income for the Period | 86,201 | (8,760) | Shift from loss to profit | | Total Comprehensive Income Attributable to Owners of the Company | 86,124 | (8,767) | Shift from loss to profit | Interim Condensed Consolidated Statement of Changes in Equity As of June 30, 2025, total equity attributable to owners of the Company increased to HK$4,433,279,000 from the beginning of the year, primarily due to an increase in other comprehensive income (exchange differences) offsetting the period's loss Key Statement of Changes in Equity Data (HK$ thousand) | Metric | June 30, 2025 | January 1, 2025 | Change | | :--- | :--- | :--- | :--- | | Total Equity Attributable to Owners of the Company | 4,433,279 | 4,347,155 | +86,124 | | (Loss)/Profit for the Period | (3,960) | N/A | N/A | | Other Comprehensive Income | 90,084 | N/A | N/A | | Total Comprehensive Income for the Period | 86,124 | N/A | N/A | Interim Condensed Consolidated Statement of Cash Flows The Group generated net cash inflow of HK$91,295,000 from operating activities in H1 2025, utilized HK$198,877,000 in investing activities and HK$9,969,000 in financing activities, resulting in a decrease in cash and cash equivalents to HK$205,950,000 at period-end Key Cash Flow Statement Data (HK$ thousand) | Metric | H1 2025 | H1 2024 | Y-o-Y Change | | :--- | :--- | :--- | :--- | | Net Cash Generated from Operating Activities | 91,295 | 77,377 | +18.0% | | Net Cash Used in Investing Activities | (198,877) | (95,886) | +107.4% | | Net Cash Used in Financing Activities | (9,969) | (47,612) | -79.1% | | Net Decrease in Cash and Cash Equivalents | (117,551) | (66,121) | +77.8% | | Cash and Cash Equivalents at End of Period | 205,950 | 275,315 | -25.2% | - Cash outflow from investing activities significantly increased, primarily due to additions to investment properties, property, plant and equipment, and an increase in bank deposits[33] Notes to the Interim Condensed Financial Information 1. General Information Goldlion Holdings Limited and its subsidiaries primarily engage in the distribution and production of apparel, leather goods, and accessories, trademark licensing, and property investment and development, with its interim financial information being unaudited - The Group's principal activities include the distribution and manufacturing of apparel, leather goods, and accessories, trademark licensing, and property investment and development[34] - This interim condensed consolidated financial information is unaudited and was approved for issue by the Board on August 14, 2025[35][36] 2. Basis of Preparation The interim condensed consolidated financial information is prepared in accordance with HKFRS 34 'Interim Financial Reporting' and consistent with the accounting policies adopted for the annual financial statements for the year ended December 31, 2024, with new and revised standards not expected to have a significant impact - The interim financial information is prepared in accordance with HKFRS 34, with accounting policies consistent with the annual financial statements[37] - New and revised standards issued but not yet effective are not expected to have a significant impact on the Group's condensed consolidated financial statements[40] 3. Financial Risk Management The Group's business is exposed to market risks (including foreign currency and cash flow interest rate risks), credit risk, and liquidity risk, with no changes in risk management policies since year-end - The Group faces market, credit, and liquidity risks, with no changes in risk management policies since year-end[42][43] 4. Critical Accounting Estimates and Judgements The preparation of interim financial information requires management to make judgments, estimates, and assumptions, which are consistent with those applied in preparing the 2024 annual consolidated financial statements - The significant judgments, estimates, and assumptions applied by management in preparing the interim financial information are consistent with those used for the annual financial statements[44] 5. Operating Segments The Group has three main reportable segments: apparel business in mainland China and Hong Kong, apparel business in Singapore, and property investment and development, with both apparel segments recording losses in H1 2025, while the property segment generated a profit H1 2025 Turnover and Segment Results by Operating Segment (HK$ thousand) | Segment | Turnover | Segment Results | | :--- | :--- | :--- | | Mainland China and Hong Kong Apparel | 349,583 | (16,333) | | Singapore Apparel | 17,081 | (3,461) | | Property Investment and Development | 119,659 | 31,223 | | Others and Eliminations | 788 | 548 | | Total Group | 487,111 | 11,977 | | Unallocated Costs | N/A | (14,533) | | Loss Before Income Tax | N/A | (2,556) | H1 2024 Turnover and Segment Results by Operating Segment (HK$ thousand) | Segment | Turnover | Segment Results | | :--- | :--- | :--- | | Mainland China and Hong Kong Apparel | 461,153 | 46,904 | | Singapore Apparel | 18,535 | (2,337) | | Property Investment and Development | 123,193 | 41,185 | | Eliminations | 380 | 14 | | Total Group | 603,261 | 85,766 | | Unallocated Costs | N/A | (17,627) | | Profit Before Income Tax | N/A | 68,139 | - Revenue from goods sales was HK$335,005,000, property sales revenue was HK$27,987,000, and investment property rental income was HK$72,002,000[45] 6. Capital Expenditure As of June 30, 2025, the net book value of property, plant and equipment was HK$215,788,000 and investment properties was HK$2,658,006,000, with total capital expenditure additions of HK$35,536,000 and a fair value loss on investment properties of HK$22,953,000 recorded during the period Overview of Capital Expenditure Changes (HK$ thousand) | Metric | Property, Plant and Equipment | Investment Properties | Total | | :--- | :--- | :--- | :--- | | Carrying amount at January 1, 2025 | 211,196 | 2,604,529 | 2,815,725 | | Additions | 31,703 | 3,833 | 35,536 | | Transfers | (12,135) | 31,392 | 19,257 | | Depreciation | (18,361) | – | (18,361) | | Impairment Loss | (120) | – | (120) | | Fair Value Loss | – | (22,953) | (22,953) | | Exchange differences | 3,560 | 41,205 | 44,765 | | Carrying amount at June 30, 2025 | 215,788 | 2,658,006 | 2,873,794 | 7. Properties Under Development As of June 30, 2025, properties under development were zero as the Meixian property in mainland China was completed during the period, compared to HK$164,630,000 at the end of last year Properties Under Development (HK$ thousand) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Land use rights | – | 52,759 | | Development costs | – | 111,871 | | Total | – | 164,630 | - Properties under development were completed during the period and reclassified as completed properties held for sale[50] 8. Completed Properties Held for Sale As of June 30, 2025, completed properties held for sale significantly increased to HK$774,482,000 from HK$590,795,000 at year-end 2024, primarily due to reclassification upon completion of properties under development Completed Properties Held for Sale (HK$ thousand) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Completed Properties Held for Sale | 774,482 | 590,795 | - Completed properties held for sale are located in Meixian, mainland China, and were initially measured at their carrying amount on the date of reclassification from properties under development[51] 9. Trade Receivables As of June 30, 2025, net trade receivables significantly decreased to HK$52,370,000 from HK$88,669,000 at year-end 2024, with the largest reduction observed in receivables aged 1 to 30 days Trade Receivables Ageing Analysis (HK$ thousand) | Ageing | June 30, 2025 | December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | 1 to 30 days | 30,570 | 63,291 | -32,721 | | 31 to 90 days | 9,256 | 16,605 | -7,349 | | Over 90 days | 13,638 | 9,396 | +4,242 | | Total Trade Receivables | 53,464 | 89,292 | -35,828 | | Less: Impairment allowance | (1,094) | (623) | -471 | | Net Trade Receivables | 52,370 | 88,669 | -36,299 | 10. Prepayments, Deposits and Other Receivables As of June 30, 2025, total prepayments, deposits, and other receivables increased to HK$63,819,000 from HK$52,571,000 at year-end 2024, primarily due to higher recoverable VAT and other receivables Prepayments, Deposits and Other Receivables (HK$ thousand) | Metric | June 30, 2025 | December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Purchase deposits | 5,220 | 2,812 | +2,408 | | Prepayments | 9,534 | 8,764 | +770 | | General deposits | 15,851 | 14,144 | +1,707 | | Interest receivable | 9,144 | 10,546 | -1,402 | | Recoverable VAT | 16,253 | 13,131 | +3,122 | | Others | 7,817 | 3,174 | +4,643 | | Total | 63,819 | 52,571 | +11,248 | 11. Share Capital As of June 30, 2025, the Company's issued and fully paid ordinary shares remained unchanged at 973,844,000 shares, with share capital of HK$1,101,358,000, consistent with year-end 2024 Share Capital (HK$ thousand) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Number of ordinary shares (thousands) | 973,844 | 973,844 | | Share Capital | 1,101,358 | 1,101,358 | 12. Trade Payables As of June 30, 2025, total trade payables significantly decreased to HK$16,894,000 from HK$49,557,000 at year-end 2024, primarily due to reductions in payables aged 1 to 30 days and 31 to 90 days Trade Payables Ageing Analysis (HK$ thousand) | Ageing | June 30, 2025 | December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | 1 to 30 days | 8,532 | 31,690 | -23,158 | | 31 to 90 days | 7,687 | 14,645 | -6,958 | | Over 90 days | 675 | 3,222 | -2,547 | | Total | 16,894 | 49,557 | -32,663 | 13. Other Losses The Group recorded a fair value loss on investment properties of HK$22,953,000 in H1 2025, an increase of 15.8% compared to the prior year Other Losses (HK$ thousand) | Metric | H1 2025 | H1 2024 | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Fair Value Loss on Investment Properties | 22,953 | 19,818 | +15.8% | 14. Expenses by Nature The Group's total expenses for H1 2025 decreased to HK$478,306,000 from the prior year, with lower cost of inventories sold and inventory impairment provisions, but increased depreciation expenses, while staff costs and advertising remained key expenditure items Expenses by Nature (HK$ thousand) | Metric | H1 2025 | H1 2024 | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Cost of inventories sold | 147,454 | 189,561 | -22.2% | | Cost of properties sold | 23,179 | 21,079 | +9.9% | | Inventory impairment provision | 8,501 | 12,350 | -31.2% | | Direct operating expenses for investment properties generating rental income | 18,239 | 17,596 | +3.6% | | Expenses relating to short-term leases and variable lease payments | 33,672 | 42,036 | -19.9% | | Depreciation of property, plant and equipment | 18,361 | 14,646 | +25.4% | | Depreciation of right-of-use assets | 11,190 | 10,528 | +6.3% | | Impairment of right-of-use assets | 4,600 | 2,245 | +104.9% | | Staff costs | 111,454 | 111,862 | -0.4% | | Advertising and promotion expenses | 43,162 | 38,424 | +12.3% | | Total | 478,306 | 527,519 | -9.3% | 15. Income Tax Expense The Group's income tax expense for H1 2025 significantly decreased to HK$1,388,000 from the prior year, primarily due to increased deferred tax reversals offsetting current tax liabilities Income Tax Expense (HK$ thousand) | Metric | H1 2025 | H1 2024 | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Current tax – PRC enterprise income tax | 9,803 | 10,882 | -9.9% | | Deferred income tax | (8,415) | (983) | +756.0% | | Total income tax expense | 1,388 | 9,899 | -86.0% | - The Group's estimated taxable profit is offset by tax losses brought forward from previous years, thus no provision for Hong Kong profits tax was made[58] - The PRC enterprise income tax rate is 25%, with subsidiaries qualifying as small-profit enterprises taxed at a preferential rate of 5%[58] 16. Dividends The Board declared an interim dividend of HK$1.0 cent per share, totaling HK$9,738,000, a reduction from HK$2.0 cents per share (totaling HK$19,477,000) in the prior year Interim Dividend (HK$ thousand) | Metric | H1 2025 | H1 2024 | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Interim dividend per ordinary share | 1.0 HK cents | 2.0 HK cents | -50% | | Total dividend payout | 9,738 | 19,477 | -50% | - No final dividend for the year ended December 31, 2024, was paid during the period[60] 17. (Loss)/Earnings Per Share Basic and diluted loss per share attributable to owners of the Company was HK$0.41 cents, compared to earnings of HK$5.98 cents in the prior year, with no potentially dilutive ordinary shares issued during the period (Loss)/Earnings Per Share (HK cents) | Metric | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | | Basic and diluted (loss)/earnings per share | (0.41) | 5.98 | Shift from profit to loss | - (Loss)/Earnings per share is calculated based on the loss attributable to owners of the Company of HK$3,960,000 and 973,844,035 ordinary shares in issue[61] 18. Commitments As of June 30, 2025, the Group's capital commitments included HK$17,136,000 for property, plant and equipment and HK$2,028,000 for investment properties, with property development and land use right commitments reduced to zero, and total future rental receivables amounting to HK$284,772,000 Capital Commitments (HK$ thousand) | Commitment Type | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Property, plant and equipment (contracted but not provided for) | 17,136 | 14,706 | | Investment properties (contracted but not provided for) | 2,028 | 4,261 | | Property development expenditure and land use rights commitments (contracted but not provided for) | – | 366 | | Property development expenditure and land use rights commitments (authorised but not contracted for) | – | 21,000 | Future Rental Receivables (HK$ thousand) | Period | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Within one year | 122,552 | 126,279 | | After one year and within five years | 158,143 | 146,088 | | After five years | 4,077 | 4,758 | | Total | 284,772 | 277,125 | 19. Mortgage Loan Guarantees As of June 30, 2025, the Group provided mortgage loan guarantees of HK$3,991,000 for certain property buyers, with the Board believing the net realizable value of the properties is sufficient to cover any defaults, thus no provision was made Mortgage Loan Guarantees (HK$ thousand) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Guarantees provided for mortgage loans of certain property buyers | 3,991 | 3,981 | - Guarantee terms stipulate that if buyers fail to make mortgage payments, the Group is responsible for repayment and has the right to take over the property title[64] 20. Related Party Transactions The Company is ultimately controlled by the Tsang family, with Mr. Tsang Chi Ming serving as both Chairman and Chief Executive Officer, and related party transactions for the period primarily included professional fees of HK$160,000 paid to Winwin Financial Advisory Limited and key management personnel remuneration of HK$9,966,000 - The Company is ultimately controlled by the Tsang family, with Mr. Tsang Chi Ming and his family members holding approximately 68.62% of the issued shares[65] Related Party Transactions (HK$ thousand) | Transaction Type | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Professional fees paid to a related company (Winwin Financial Advisory Limited) | 160 | 160 | | Key management personnel remuneration | 9,966 | 11,840 | Supplementary Information Interim Dividend The Board recommended an interim dividend of HK$1.0 cent per share for the year ending December 31, 2025, totaling HK$9,738,000, expected to be paid on September 17, 2025 Interim Dividend | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Interim dividend per share | 1.0 HK cents | 2.0 HK cents | | Total dividend payout | 9,738 | 19,477 | Closure of Register of Members To ascertain the right to receive the proposed dividend, the Company will suspend its register of members on September 4 and September 5, 2025 - The register of members will be closed on September 4 and September 5, 2025, to determine eligibility for the interim dividend[68] Purchase, Sale or Redemption of Shares Neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's shares during the period - Neither the Company nor its subsidiaries conducted any share repurchases, sales, or redemptions during the period[69] Directors' and Chief Executive's Interests and Short Positions in Shares, Underlying Shares and Debentures As of June 30, 2025, Mr. Tsang Chi Ming held a long position of 614,438,750 ordinary shares in the Company, representing 63.09% of the issued share capital, primarily through other interests (family trust), with no other disclosable interests or short positions for directors and chief executive Mr. Tsang Chi Ming's Interests in the Company's Ordinary Shares | Director | Interest Type | Personal Interest (shares) | Other Interests (shares) | Total (shares) | Percentage of total issued share capital | | :--- | :--- | :--- | :--- | :--- | :--- | | Tsang Chi Ming | Long Position | 1,404,000 | 613,034,750 | 614,438,750 | 63.09% | - Mr. Tsang Chi Ming's other interests are primarily held by Tsang Hin Chi Family Management Limited, as trustee of The Tsang Hin Chi (2007) Family Discretionary Trust[70] Substantial Shareholders' Interests and Short Positions in Shares and Underlying Shares As of June 30, 2025, Tsang Hin Chi Family Management Limited, Top Grade Holdings Limited, Silver Disc Limited, Tsang Hin Chi Charitable (Management) Limited, and FMR LLC were substantial shareholders of the Company, holding 5% or more of the issued share capital Substantial Shareholders' Interests in the Company's Shares | Name of Securities Holder | Total Number of Shares Held (shares) | Percentage of total issued share capital | | :--- | :--- | :--- | | Tsang Hin Chi Family Management Limited | 613,034,750 | 62.95% | | Top Grade Holdings Limited | 613,034,750 | 62.95% | | Silver Disc Limited | 160,616,000 | 16.49% | | Tsang Hin Chi Charitable (Management) Limited | 53,880,750 | 5.53% | | FMR LLC | 53,160,331 | 5.46% | - Tsang Hin Chi Family Management Limited indirectly holds shares through Top Grade Holdings Limited and its wholly-owned subsidiaries, Silver Disc Limited and Keysonic Development Limited[74] Corporate Governance The Company complied with the Corporate Governance Code in Appendix C1 of the HKEX Listing Rules during H1 2025, with Mr. Tsang Chi Ming serving as both Chairman and Chief Executive Officer to enhance decision-making efficiency, and all directors adhering to the Model Code for securities transactions - The Company complies with the Corporate Governance Code set out in Appendix C1 of the HKEX Listing Rules[75] - Mr. Tsang Chi Ming serves concurrently as Chairman and Chief Executive Officer, an arrangement the Board believes facilitates more effective planning and promotion of long-term business strategies[75] Audit Committee The Company's Audit Committee comprises four members, including three independent non-executive directors and one non-executive director, responsible for reviewing and overseeing the Group's financial reporting, risk management, and internal control systems - The Audit Committee comprises Mr. Li Ka Fai (Chairman), Ms. Law Wing Sze, Mr. Chan Kwong Ming (Independent Non-executive Directors), and Mr. Ng Ming Wah (Non-executive Director)[76] Review of Financial Information The Audit Committee has reviewed the Group's unaudited interim financial information for the six months ended June 30, 2025, which was also reviewed by external auditor PricewaterhouseCoopers in accordance with HKSRE 2410 - Both the Audit Committee and external auditor PricewaterhouseCoopers have reviewed the interim financial information[77] Board of Directors As of the report date, the Board of Directors comprises Executive Director Mr. Tsang Chi Ming (Chairman and Chief Executive Officer), Non-executive Director Mr. Ng Ming Wah, and Independent Non-executive Directors Mr. Li Ka Fai, Ms. Law Wing Sze, and Mr. Chan Kwong Ming - The Board of Directors includes executive, non-executive, and independent non-executive directors[78]