力盟科技(02405) - 2025 - 中期业绩

Company Information This section provides general information about the company and its reporting period Company Overview This announcement details Powerwin Tech Group Limited's unaudited interim results for H1 2025 - Company Name: Powerwin Tech Group Limited (Stock Code: 2405)[2] - Reporting Period: Unaudited consolidated interim results for the six months ended June 30, 2025[3] Financial Statements This section presents the company's consolidated financial statements, including profit or loss and financial position Consolidated Statement of Profit or Loss and Other Comprehensive Income For H1 2025, the company experienced a significant revenue decline, leading to a substantial deterioration in gross profit and operating results, turning a profit into a loss Key Financial Data (Income Statement) | Metric | For the six months ended June 30, 2025 (US$ thousand) | For the six months ended June 30, 2024 (US$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 3,250 | 7,368 | -55.9% | | Cost of Sales | (992) | (1,139) | -12.9% | | Gross Profit | 2,258 | 6,229 | -63.8% | | Selling and Marketing Expenses | (231) | (296) | -22.0% | | Administrative Expenses | (2,193) | (1,763) | +24.4% | | Expected Credit Losses on Trade Receivables | (2,409) | (1,576) | +52.9% | | Other Income | 193 | 328 | -41.1% | | Operating (Loss)/Profit | (2,382) | 2,922 | 由盈转亏 | | Finance Costs | (1,871) | (2,680) | -30.2% | | Fair Value Changes of Financial Assets | 104 | 55 | +89.1% | | (Loss)/Profit Before Tax | (4,149) | 297 | 由盈转亏 | | Income Tax | 391 | 41 | +853.7% | | (Loss)/Profit for the Period | (3,758) | 338 | 由盈转亏 | | Basic (Loss)/Earnings Per Share (US cents) | (0.47) | 0.04 | 由盈转亏 | Consolidated Statement of Financial Position As of June 30, 2025, total assets and liabilities decreased, primarily due to reductions in receivables and bank borrowings, impacting net current assets and net assets Key Financial Data (Balance Sheet) | Metric | June 30, 2025 (US$ thousand) | December 31, 2024 (US$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Non-current Assets | | | | | Property, Plant and Equipment | 59 | 67 | -11.9% | | Right-of-Use Assets | 798 | 360 | +121.7% | | Intangible Assets | 1,827 | 2,036 | -10.3% | | Financial Assets at Fair Value Through Profit or Loss | 4,689 | 4,627 | +1.3% | | Deferred Tax Assets | 1,497 | 1,087 | +37.7% | | Total Non-current Assets | 8,870 | 8,177 | +8.5% | | Current Assets | | | | | Trade and Other Receivables | 183,407 | 222,373 | -17.5% | | Cash and Cash Equivalents | 16,276 | 34,393 | -52.7% | | Prepaid Income Tax | 1,221 | 1,221 | 0.0% | | Total Current Assets | 200,904 | 257,987 | -22.2% | | Current Liabilities | | | | | Trade and Other Payables | 164,252 | 129,032 | +27.3% | | Contract Liabilities | 3,411 | 4,071 | -16.2% | | Bank Borrowings | 13,126 | 100,638 | -86.9% | | Lease Liabilities | 478 | 326 | +46.6% | | Current Tax | 14 | 13 | +7.7% | | Total Current Liabilities | 181,281 | 234,080 | -22.6% | | Net Current Assets | 19,623 | 23,907 | -17.9% | | Total Assets Less Current Liabilities | 28,493 | 32,084 | -11.3% | | Non-current Liabilities | | | | | Bank Borrowings | 1,808 | 1,920 | -5.8% | | Lease Liabilities | 349 | 69 | +405.8% | | Total Non-current Liabilities | 2,157 | 1,989 | +8.4% | | Net Assets | 26,336 | 30,095 | -12.5% | | Total Equity | 26,336 | 30,095 | -12.5% | Notes to the Financial Statements This section provides detailed notes and explanations for the figures presented in the consolidated financial statements 1 Basis of Preparation The condensed interim consolidated financial statements are prepared in accordance with HKAS 34 and the Listing Rules, authorized for issue on August 28, 2025 - Basis of Preparation: HKEX Listing Rules and Hong Kong Accounting Standard 34 'Interim Financial Reporting'[7] - Authorization Date: August 28, 2025[7] - Accounting Policies: Same as those adopted in the 2024 annual financial statements, except for changes expected to be reflected in the 2025 annual financial statements[7] 2 Changes in Accounting Policies The Group applied HKAS 21 (Amendment) 'The Effects of Changes in Foreign Exchange Rates – Lack of Exchangeability' with no material impact due to the absence of relevant foreign currency transactions - New Standard Applied: Hong Kong Accounting Standard 21 (Amendment) 'The Effects of Changes in Foreign Exchange Rates – Lack of Exchangeability'[8] - Impact: No material impact on these interim financial statements, as the Group had no foreign currency non-exchangeable transactions[8] - Standards Not Applied: No new standards or interpretations effective for the current accounting period have been applied[9] 3 Revenue and Segment Information The Group's core businesses are cross-border digital marketing and e-commerce SaaS solutions, with total revenue significantly decreasing by 55.9% year-on-year for H1 2025 - Principal Business: Provision of cross-border digital marketing services and cross-border e-commerce SaaS solutions[10] Customer Contract Revenue by Major Service | Service Type | For the six months ended June 30, 2025 (US$ thousand) | For the six months ended June 30, 2024 (US$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Cross-border Digital Marketing Services | 2,951 | 5,995 | -50.8% | | - Standardized Digital Marketing | 1,491 | 3,221 | -53.7% | | - Customized Digital Marketing | 549 | 1,549 | -64.6% | | - SaaS-based Digital Marketing | 911 | 1,225 | -25.6% | | Cross-border E-commerce SaaS Solutions | 299 | 1,373 | -78.2% | | Total Revenue | 3,250 | 7,368 | -55.9% | Major Customer Revenue Concentration | Client | For the six months ended June 30, 2025 (US$ thousand) | For the six months ended June 30, 2024 (US$ thousand) | | :--- | :--- | :--- | | Client 1 | 1,234 | 2,935 | | Client 2 | 680 | 2,363 | | Client 3 | Not applicable* | 1,024 | *This indicates revenue from this client accounted for less than 10% of the Group's revenue during the period Geographical Revenue Distribution | Region | For the six months ended June 30, 2025 (US$ thousand) | For the six months ended June 30, 2024 (US$ thousand) | | :--- | :--- | :--- | | Hong Kong | 3,248 | 7,367 | | Mainland China | 2 | 1 | | Total | 3,250 | 7,368 | Geographical Location of Specific Non-current Assets | Region | June 30, 2025 (US$ thousand) | December 31, 2024 (US$ thousand) | | :--- | :--- | :--- | | Hong Kong | 2,531 | 2,194 | | Mainland China | 153 | 269 | | Total | 2,684 | 2,463 | 4 (Loss)/Profit Before Tax For H1 2025, the company reported a pre-tax loss of US$4,149 thousand, a significant shift from the prior year's profit, influenced by finance costs, staff costs, and R&D expenses Finance Costs | Item | For the six months ended June 30, 2025 (US$ thousand) | For the six months ended June 30, 2024 (US$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Interest on Bank Borrowings | 1,863 | 2,664 | -30.1% | | Interest on Lease Liabilities | 8 | 16 | -50.0% | | Total | 1,871 | 2,680 | -30.2% | Staff Costs | Item | For the six months ended June 30, 2025 (US$ thousand) | For the six months ended June 30, 2024 (US$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Salaries, Wages and Other Benefits | 1,759 | 1,803 | -2.4% | | Retirement Scheme Contributions | 123 | 111 | +10.8% | | Total | 1,882 | 1,914 | -1.7% | Other Items | Item | For the six months ended June 30, 2025 (US$ thousand) | For the six months ended June 30, 2024 (US$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Gain on Fair Value Changes of Financial Assets | (104) | (55) | +89.1% | | Research and Development Costs | 524 | 614 | -14.6% | | Amortization of Intangible Assets | 209 | 3 | +6866.7% | | Depreciation - Property, Plant and Equipment | 13 | 15 | -13.3% | | Depreciation - Right-of-Use Assets | 303 | 302 | +0.3% | - R&D costs include staff costs for R&D department employees, amounting to US$524 thousand in H1 2025 (H1 2024: US$614 thousand)[18] 5 Income Tax in Consolidated Statement of Profit or Loss and Other Comprehensive Income For H1 2025, the company recorded an income tax credit of US$391 thousand, primarily due to an increase in deferred tax assets, contrasting with an expense in the prior year Income Tax Components | Item | For the six months ended June 30, 2025 (US$ thousand) | For the six months ended June 30, 2024 (US$ thousand) | | :--- | :--- | :--- | | Current Tax - Provision for the Period | 19 | 220 | | Deferred Tax - Origination and Reversal of Temporary Differences | (410) | (261) | | Total | (391) | (41) | - Tax Rates: No income tax in Cayman Islands and BVI. Hong Kong profits tax rate is 16.5%, with 8.25% for the first HK$2 million for eligible subsidiaries. PRC subsidiaries' statutory income tax rate is 25%[19][20] - Effective Income Tax Rate: 9.4% in H1 2025, compared to -13.8% in H1 2024[52] 6 (Loss)/Earnings Per Share For H1 2025, the company reported a basic loss per share of 0.47 US cents, a reversal from the prior year's profit per share, driven by the period's net loss - Basic (Loss)/Earnings Per Share: Loss of 0.47 US cents per share in H1 2025, compared to profit of 0.04 US cents per share in H1 2024[21] - Weighted Average Number of Ordinary Shares: 800,000,000 shares for both periods[21] - Dilutive Effect: No potential dilutive ordinary shares for both periods, thus diluted (loss)/earnings per share equals basic (loss)/earnings per share[21] 7 Right-of-Use Assets As of June 30, 2025, the net book value of right-of-use assets increased to US$798 thousand, primarily due to new additions despite depreciation expenses Right-of-Use Asset Movements | Item | 2025 (US$ thousand) | 2024 (US$ thousand) | | :--- | :--- | :--- | | Net Book Value, as at January 1 | 360 | 838 | | Additions | 740 | 48 | | Lease Modifications | – | (31) | | Depreciation Expense for the Period | (303) | (302) | | Exchange Adjustments | 1 | (1) | | Net Book Value, as at June 30 | 798 | 552 | 8 Trade and Other Receivables As of June 30, 2025, total trade and other receivables decreased by 17.5% to US$183,407 thousand from year-end 2024, mainly due to reduced gross billings, though loss allowance increased Trade and Other Receivables Components | Item | June 30, 2025 (US$ thousand) | December 31, 2024 (US$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Trade Receivables - Third Parties | 192,376 | 228,934 | -16.0% | | Less: Loss Allowance for Trade Receivables | (9,786) | (7,378) | +32.6% | | Net Trade Receivables | 182,590 | 221,556 | -17.6% | | Amounts Due from Related Parties | 8 | 13 | -38.5% | | Amounts Due from Third Parties | 809 | 804 | +0.6% | | Total | 183,407 | 222,373 | -17.5% | - All receivables are expected to be recovered within one year[23] - Factoring Arrangements: As of June 30, 2025, trade receivables under factoring arrangements amounted to US$14,295 thousand, a significant decrease from US$126,112 thousand at year-end 2024[23] Trade Receivables Aging Analysis | Aging | June 30, 2025 (US$ thousand) | December 31, 2024 (US$ thousand) | | :--- | :--- | :--- | | Within 1 month | 39,057 | 62,614 | | After 1 month but within 2 months | 27,831 | 64,694 | | After 2 months but within 3 months | 17,747 | 13,698 | | After 3 months but within 6 months | 14,294 | 17,404 | | After 6 months but within 12 months | 47,723 | 52,487 | | Over 12 months | 45,724 | 18,037 | | Total | 192,376 | 228,934 | - Trade Receivables Due Date: Within 30 to 300 days from invoice date[24] 9 Trade and Other Payables As of June 30, 2025, total trade and other payables increased by 27.3% to US$164,252 thousand from year-end 2024, primarily due to reduced payments to suppliers Trade and Other Payables Components | Item | June 30, 2025 (US$ thousand) | December 31, 2024 (US$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Trade Payables - Third Parties | 163,649 | 128,459 | +27.4% | | VAT and Other Taxes Payable | 95 | 21 | +352.4% | | Salaries Payable | 280 | 265 | +5.7% | | Other Payables and Accruals | 228 | 287 | -20.5% | | Total | 164,252 | 129,032 | +27.3% | - All payables are expected to be settled within one year or on demand[25] Trade Payables Aging Analysis | Aging | June 30, 2025 (US$ thousand) | December 31, 2024 (US$ thousand) | | :--- | :--- | :--- | | Within 1 month | 41,985 | 62,236 | | After 1 month but within 3 months | 67,885 | 66,223 | | After 3 months but within 6 months | 53,779 | – | | Total | 163,649 | 128,459 | 10 Bank Borrowings As of June 30, 2025, total bank borrowings significantly decreased by 85.4% to US$14,934 thousand from year-end 2024, mainly due to reduced funding needs from lower gross billings Bank Borrowings Repayment Schedule | Term | June 30, 2025 (US$ thousand) | December 31, 2024 (US$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Within 1 year or on demand | 13,126 | 100,638 | -86.9% | | After 1 year but within 2 years | 189 | 221 | -14.5% | | After 2 years but within 5 years | 180 | 260 | -30.8% | | After 5 years | 1,439 | 1,439 | 0.0% | | Total | 14,934 | 102,558 | -85.4% | - Total secured bank borrowings amounted to US$14,934 thousand (December 31, 2024: US$102,558 thousand)[29] - Bank borrowings of US$2,069 thousand are guaranteed by the Group and secured by financial assets at fair value through profit or loss[29] - Bank borrowings of US$12,865 thousand are guaranteed by the Group and secured by trade receivables under factoring arrangements[29] - As of June 30, 2025, no bank borrowings were solely secured by trade receivables under factoring arrangements (December 31, 2024: US$42,474 thousand)[29][62] 11 Capital, Reserves and Dividends For H1 2025, the company neither declared nor paid any interim dividends, with its authorized and issued share capital remaining unchanged - Dividends: No dividends were declared or paid for the six months ended June 30, 2025 and 2024[30][31] - Share Capital: Authorized share capital of 2,000,000,000 ordinary shares of US$0.01 each, with 800,000,000 ordinary shares issued, consistent with year-end 2024[32] - Share Premium: Under Cayman Islands Companies Act, share premium account may be used for distributions or dividends to shareholders, provided the company is able to pay its debts as they fall due in the ordinary course of business[33] - Exchange Reserve: Includes all foreign exchange differences arising from the translation of financial information of entities not using US dollars as their functional currency[34] 12 Unadjusted Events After the Reporting Period Subsequent to the reporting period, the company disposed of its entire equity interest in Powerwin Media Group Limited, generating an estimated gain of approximately US$0.45 million, with the transaction completed - Disposal: The company's direct wholly-owned subsidiary, Jiacheng Investment Group Limited, disposed of 1,000,000 shares of Powerwin Media Group Limited[35] - Counterparty: Chinalink International Development Limited, an independent third party[35] - Consideration: US$1.95 million[35] - Estimated Gain: Approximately US$0.45 million[35] - Completion Date: Completed as of the date of this announcement[36] Business Overview and Review This section provides an overview of the company's business, its operational performance during the period, and future strategic outlook Overview Powerwin Tech Group Limited is a Chinese cross-border digital marketing service provider, assisting marketers in global expansion and collaborating with major media publishers - Core Business: China cross-border digital marketing service provider[37] - Service Offerings: Standardized, customized, and SaaS-based cross-border digital marketing solutions, and cross-border e-commerce SaaS solutions[37] - Objective: Empower Chinese marketers to acquire users, promote products, and assist media publishers in monetization[37] Business Review As of June 30, 2025, the company served over 3,000 marketers and partnered with 20 major global media publishers, offering various digital marketing and e-commerce SaaS solutions - Clients Served: As of June 30, 2025, over 3,000 marketers served, spanning e-commerce, online gaming, and applications[38] - Media Partnerships: Collaborations with 20 major global media publishers including Meta, Google, X, TikTok, and over 50 vertical media publishers[38] - Cross-border Digital Marketing Service Types: Standardized digital marketing services, customized digital marketing services, SaaS-based digital marketing services[38][41] - Cross-border E-commerce SaaS Solutions: Provided via the Powershopy platform, charging fixed monthly fees and/or commissions[39] - Staffing: As of June 30, 2025, 60 full-time employees (2024: 76), with total staff costs of US$1.9 million[40] Outlook Facing geopolitical uncertainties and global economic volatility, the company plans to enhance client and media partnerships, leverage AI for marketing optimization, and explore strategic opportunities to sustain growth - Challenges: Geopolitical uncertainties and global economic volatility leading to challenges and profit decline in the digital marketing industry[42] - Strategies: Close collaboration with clients for customized services; precise audience targeting with media partners; maintaining growth in cross-border digital marketing; leveraging AI and hyper-personalization to optimize Adorado SaaS and Powershopy platforms; continuous evaluation of strategic cooperation and investment opportunities[42] Financial Review This section provides a detailed analysis of the company's financial performance and key financial metrics for the reporting period Revenue For H1 2025, total revenue significantly decreased by 55.9% to US$3.3 million, primarily due to substantial cuts in client digital advertising budgets amid global economic volatility - Total Revenue: Decreased by 55.9% from US$7.4 million in H1 2024 to US$3.3 million in H1 2025[43] - Primary Reason: Significant reduction in client digital advertising budgets due to global economic volatility and geopolitical uncertainties[43] Cross-border Digital Marketing Revenue Breakdown | Service Type | For the six months ended June 30, 2025 (US$ million) | For the six months ended June 30, 2024 (US$ million) | Change (%) | | :--- | :--- | :--- | :--- | | Standardized Digital Marketing | 1.5 | 3.2 | -53.7% | | Customized Digital Marketing | 0.5 | 1.5 | -64.6% | | SaaS-based Digital Marketing | 0.9 | 1.2 | -25.6% | - Cross-border E-commerce SaaS Solutions Revenue: Decreased by 78.2% from US$1.4 million in H1 2024 to US$0.3 million in H1 2025, primarily due to reduced commission income[45] Cost of Sales For H1 2025, cost of sales decreased by 12.9% to US$1.0 million, mainly attributed to optimized staff structure leading to reduced revenue and staff costs - Cost of Sales: Decreased from US$1.1 million in H1 2024 to US$1.0 million in H1 2025[46] - Primary Reason: Optimized staff structure leading to reduced revenue and staff costs[46] Gross Profit and Gross Margin For H1 2025, gross profit significantly decreased by 63.8% to US$2.3 million, with gross margin falling to 69.5%, primarily due to intensified competition and promotional activities in digital marketing services - Gross Profit: Decreased by 63.8% from US$6.2 million in H1 2024 to US$2.3 million in H1 2025[47] - Gross Margin: Decreased from 84.5% in H1 2024 to 69.5% in H1 2025[47] - Primary Reason: Reduced revenue due to intensified competition in digital marketing services and promotional measures to counter competition[47] - Cost optimization could not fully offset the impact of revenue decline on gross margin[47] Selling and Marketing Expenses For H1 2025, selling and marketing expenses slightly decreased to US$0.2 million - Selling and Marketing Expenses: Slightly decreased from US$0.3 million in H1 2024 to US$0.2 million in H1 2025[48] Administrative Expenses For H1 2025, administrative expenses increased by 24.4% to US$2.2 million, primarily due to additional costs incurred from staff optimization initiatives - Administrative Expenses: Increased from US$1.8 million in H1 2024 to US$2.2 million in H1 2025[49] - Primary Reason: Additional costs incurred from staff optimization initiatives[49] Expected Credit Losses on Trade Receivables For H1 2025, expected credit losses on trade receivables increased by 52.9% to US$2.4 million, mainly due to higher bad debt provisions as some clients extended payment periods due to operational adjustments - Expected Credit Losses: Increased from US$1.6 million in H1 2024 to US$2.4 million in H1 2025[50] - Primary Reason: Increased bad debt provisions due to extended collection periods from certain clients' operational adjustments[50] - The company actively communicates with clients to follow up on collections[50] Finance Costs For H1 2025, finance costs decreased by 30.2% to US$1.9 million, primarily due to reduced funding requirements for bank borrowings resulting from lower gross billings - Finance Costs: Decreased from US$2.7 million in H1 2024 to US$1.9 million in H1 2025[51] - Primary Reason: Reduced gross billings, leading to decreased funding requirements for bank borrowings[51] Income Tax Credit For H1 2025, the company recorded an income tax credit of US$0.4 million, primarily due to an increase in deferred tax assets arising from temporary deductible differences related to trade receivables credit loss provisions - Income Tax Credit: US$0.4 million in H1 2025, compared to US$0.04 million in H1 2024[52] - Primary Reason: Increase in deferred tax assets arising from temporary deductible differences related to trade receivables credit loss provisions[52] - Effective Income Tax Rate: 9.4% in H1 2025, compared to -13.8% in H1 2024[52] (Loss)/Profit for the Period For H1 2025, the company reported a loss of US$3.8 million, a reversal from the prior year's profit, influenced by decreased revenue, increased administrative expenses, and higher expected credit losses - (Loss)/Profit for the Period: A US$3.8 million loss recorded in H1 2025, compared to a US$0.3 million profit in H1 2024[53] Trade Receivables As of June 30, 2025, trade receivables decreased to US$192.4 million from US$228.9 million at year-end 2024, primarily due to reduced gross billings - Trade Receivables: Decreased from US$228.9 million as of December 31, 2024, to US$192.4 million as of June 30, 2025[54] - Primary Reason: Reduced gross billings[54] Trade and Other Payables As of June 30, 2025, trade and other payables increased to US$164.3 million from US$129.0 million at year-end 2024, primarily due to reduced payments to suppliers - Trade and Other Payables: Increased from US$129.0 million as of December 31, 2024, to US$164.3 million as of June 30, 2025[55] - Primary Reason: Reduced payments to the Group's suppliers[55] Bank Borrowings As of June 30, 2025, bank borrowings significantly decreased to US$14.9 million from US$102.6 million at year-end 2024, primarily due to reduced funding needs from lower gross billings - Bank Borrowings: Decreased from US$102.6 million as of December 31, 2024, to US$14.9 million as of June 30, 2025[56] - Primary Reason: Reduced gross billings, leading to decreased funding required by the Group through bank borrowings[56] Liquidity and Financial Resources This section details the company's cash position, liquidity management, debt levels, and financial policies Liquidity and Financial Resources As of June 30, 2025, cash and cash equivalents decreased to US$16.3 million, and net current assets fell to US$19.6 million, mainly due to bank loan repayments and reduced trade receivables - Cash and Cash Equivalents: Decreased from US$34.4 million as of December 31, 2024, to US$16.3 million as of June 30, 2025[57] - Reason for Decrease: Primarily due to the Group's repayment of bank borrowings[57] - Net Current Assets: Decreased from US$23.9 million as of December 31, 2024, to US$19.6 million as of June 30, 2025[57] - Reason for Decrease: Reduced trade receivables and cash and cash equivalents[57] - Primary Financing Source: Bank borrowings, amounting to US$14.9 million as of June 30, 2025 (December 31, 2024: US$102.6 million)[57] Interim Dividend The Board of Directors does not recommend the payment of any interim dividend for the six months ended June 30, 2025 - No Interim Dividend: The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025[58] Gearing Ratio As of June 30, 2025, the gearing ratio significantly improved to 56.7% from 340.8% at year-end 2024, primarily due to a substantial reduction in total borrowings - Gearing Ratio: Decreased from 340.8% as of December 31, 2024, to 56.7% as of June 30, 2025[59] - Primary Reason: Reduction in the Group's borrowings[59] Debt-to-Equity Ratio As of June 30, 2025, the Group was in a net cash position, a significant improvement from a debt-to-equity ratio of 226.5% at year-end 2024, primarily due to reduced total borrowings - Debt-to-Equity Ratio: As of June 30, 2025, the Group was in a net cash position (December 31, 2024: 226.5%)[60] - Primary Reason: Reduction in the Group's borrowings[60] Contingent Liabilities As of June 30, 2025, and December 31, 2024, the Group had no material contingent liabilities - No Material Contingent Liabilities: None as of June 30, 2025, and December 31, 2024[61] Pledge of Assets As of June 30, 2025, certain bank borrowings are secured by financial assets at fair value and trade receivables, with the total pledged amount decreasing from year-end 2024 - Bank borrowings of US$2,069 thousand are secured by financial assets at fair value through profit or loss[62] - Bank borrowings of US$12,865 thousand are secured by trade receivables (under factoring arrangements)[62] - As of June 30, 2025, no bank borrowings were solely secured by trade receivables under factoring arrangements (December 31, 2024: US$42,474 thousand)[29][62] Treasury Policy The company adopts a prudent financial management approach, ensuring liquidity for operations and capital expenditures, closely monitoring its liquidity position, and appropriately investing surplus cash - Treasury Policy: Prudent, ensuring liquidity requirements[63] - Board Responsibilities: Closely monitor liquidity, consider credit, liquidity, and market risks of financial instruments, and appropriately invest surplus cash[63] Interest Rate Risk The company's interest rate risk primarily stems from fixed and variable rate bank borrowings and lease liabilities; interest expenses on bank borrowings decreased, and the company regularly monitors exposure to mitigate this risk - Risk Sources: Fixed and variable rate bank borrowings, and lease liabilities[64] - Bank Borrowing Interest: Decreased from US$2.7 million in H1 2024 to US$1.9 million in H1 2025[64] - Management Strategy: Regularly monitor risk exposure to mitigate interest rate risk[64] Foreign Exchange Risk Operating in Hong Kong with most monetary assets, liabilities, and transactions denominated in US dollars, the company does not face significant foreign exchange risk - Operating Location: Hong Kong[65] - Primary Denomination Currency: US dollars[65] - Foreign Exchange Risk: No significant foreign exchange risk[65] Material Investments, Acquisitions and Disposals For H1 2025, the company made no material investments, acquisitions, or disposals, and currently has no significant investment or capital asset plans - During the Reporting Period: No material investments, acquisitions, or disposals[66] - Future Plans: As of June 30, 2025, no material investment or capital asset plans[66] Use of Proceeds from Initial Public Offering The company listed on March 31, 2023, with net proceeds of approximately HK$96.8 million; as of June 30, 2025, HK$3.5 million was used for R&D, with the remainder planned for use by year-end 2025 as per prospectus - Listing Date: March 31, 2023[67] - Net Proceeds: Approximately HK$96.8 million[67] Use of Net Proceeds Details (As of June 30, 2025) | Purpose | Allocation Percentage | Allocated Amount (HK$ million) | Unutilized as of Dec 31, 2024 (HK$ million) | Utilized in H1 2025 (HK$ million) | Unutilized as of Jun 30, 2025 (HK$ million) | Expected Timeline of Use | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Strengthening R&D Capabilities | 41.7% | 40.3 | 11.2 | 3.5 | 7.7 | 2025 year-end | | Promoting Cross-border E-commerce SaaS Business | 13.3% | 12.9 | 12.9 | – | 12.9 | 2025 year-end | | Upgrading Business and Internal Management Systems | 10.0% | 9.7 | 9.7 | – | 9.7 | 2025 year-end | | Enhancing Overseas Localization Service Capabilities | 15.0% | 14.5 | 14.5 | – | 14.5 | 2025 year-end | | Seeking Strategic Cooperation or Investment Opportunities | 10.0% | 9.7 | 9.7 | – | 9.7 | 2025 year-end | | Working Capital and General Corporate Purposes | 10.0% | 9.7 | – | – | – | N/A | | Total | | 96.8 | 58.0 | 3.5 | 54.5 | | - No material changes or delays in the use of net proceeds, which will continue to be utilized as revised in the prospectus and annual results announcement[68][69] Other Information This section covers additional disclosures, including post-reporting period events and securities transactions Events After the Reporting Period Subsequent to the reporting period, the company completed the disposal of its indirect wholly-owned subsidiary, Powerwin Media Group Limited, on July 31, 2025, ceasing to be a subsidiary - Disposal: The company's direct wholly-owned subsidiary, Jiacheng Investment Group Limited, disposed of the entire issued share capital of Powerwin Media Group Limited[70] - Completion Date: July 31, 2025[70] - Impact: Powerwin Media Group Limited ceased to be a subsidiary of the company[70] - No other material events after the reporting period[70] Purchase, Sale or Redemption of the Company's Listed Securities For H1 2025, neither the company nor its subsidiaries purchased, sold, or redeemed any listed securities, and the company held no treasury shares - No purchase, sale, or redemption of listed securities[71] - No treasury shares held[71] Corporate Governance This section outlines the company's adherence to corporate governance principles and relevant regulatory codes Compliance with Corporate Governance Code Provisions in Appendix C1 Part 2 of the Listing Rules The company complies with the Corporate Governance Code in Appendix C1 Part 2 of the Listing Rules, with the exception of the Chairman and CEO roles being combined, an arrangement the Board believes benefits management and will be reviewed periodically - Compliance: Adopted and complied with the Corporate Governance Code, except for the combined roles of Chairman and Chief Executive Officer[72] - Chairman and CEO: Mr. Li Xiang holds both roles of Chairman of the Board and Chief Executive Officer[73] - Board's View: Believes this arrangement benefits Group management and will be reviewed periodically[73] - Board Composition: Acknowledges the importance of a balanced composition of executive and independent non-executive directors to ensure independent judgment[73] Compliance with the Model Code for Securities Transactions by Directors The company has adopted and its directors confirmed compliance with the Model Code for Securities Transactions by Directors of Listed Issuers during the reporting period - Code Adoption: Adopted the Model Code for Securities Transactions by Directors of Listed Issuers[74] - Compliance: Directors confirmed compliance with the Code during the reporting period[74] Review of Unaudited Interim Results These interim results are a summary of the condensed interim consolidated financial statements, reviewed by KPMG in accordance with HKSRE 2410 and by the Board's Audit Committee - Nature: Summary of condensed interim consolidated financial statements, unaudited[75] - Reviewing Body: KPMG reviewed in accordance with Hong Kong Standard on Review Engagements 2410[75] - Internal Review: Reviewed by the Board's Audit Committee[75] Publication of Interim Results Announcement and Interim Report This interim results announcement is published on the HKEX and company websites, where the full interim report containing all required information will also be available - Publication Platforms: HKEX website (www.hkexnews.hk) and company website (www.empowerwin.com)[76](index=76&type=chunk) - Interim Report: The interim report containing all information required by the Listing Rules will be available[76] Management Information This section provides details about the composition of the company's Board of Directors Board of Directors As of the announcement date, the Board comprises Mr. Li Xiang as Chairman and CEO, Ms. Yu Lu as Executive Director, and three Independent Non-executive Directors: Ms. Zhao Yan, Mr. Gong Peiyue, and Mr. Li Guotai - Chairman, CEO, and Executive Director: Mr. Li Xiang[77][78] - Executive Director: Ms. Yu Lu[78] - Independent Non-executive Directors: Ms. Zhao Yan, Mr. Gong Peiyue, Mr. Li Guotai[78]