乐氏国际控股(01529) - 2025 - 中期业绩

Corporate Information Board of Directors and Committee Composition The company's board members changed during the reporting period, with Mr. Du Yingyou and Mr. Chen Guanyong resigning, leading to corresponding adjustments in audit, remuneration, and nomination committee memberships - Executive Director Mr. Du Yingyou resigned on March 17, 2025[6][8][200] - Independent Non-executive Director Mr. Chen Guanyong resigned on May 22, 2025, and ceased to be a member of the Audit, Remuneration, and Nomination Committees[6][7][8][200] - Mr. Zhang Yao was appointed as a member of the Audit and Remuneration Committees on May 22, 2025, and as a member of the Nomination Committee on the same day[6][7][8] - Ms. Liu Ping and Dr. Wang Yi were appointed as members of the Nomination Committee on June 19, 2025[7][8] Company Details Lecoo International Holdings Group Limited is registered in the Cayman Islands, with its headquarters in Guangzhou, China, and shares listed on the Hong Kong Stock Exchange - The company's registered office is in the Cayman Islands, with its headquarters and principal place of business in CITIC Plaza, Tianhe North Road, Guangzhou, China[9][11][20] - The principal place of business in Hong Kong is Wing Yip Centre, Queen's Road Central[9][11][20] - The company's shares are listed on the Main Board of The Stock Exchange of Hong Kong Limited, stock code 1529[10][11][21] Unaudited Interim Results The company announced its unaudited consolidated results for the six months ended June 30, 2025, with comparative figures for the same period in 2024 - This announcement contains the full text of the Group's 2025 interim report, complying with relevant Listing Rules requirements for preliminary announcements of interim results[3] - The condensed consolidated financial statements for the six months ended June 30, 2025, are unaudited but have been reviewed by the company's Audit Committee[22][23] Condensed Consolidated Statement of Profit or Loss The Group's revenue significantly grew by 96.1% to RMB 185.7 million in H1 2025, driven by transportation services, while loss for the period narrowed substantially to RMB 3.5 million Condensed Consolidated Statement of Profit or Loss Key Data (Six Months Ended June 30) | Indicator | 2025 H1 (RMB'000) | 2024 H1 (RMB'000) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 185,656 | 94,701 | +96.1% | | Other income and net gains | 2,983 | 3,895 | -23.4% | | Loss on disposal of subsidiaries | (2,075) | – | N/A | | Employee benefits expenses | (26,848) | (36,793) | -27.0% | | Sub-contracting expenses | (137,789) | (48,070) | +186.6% | | Depreciation & Amortisation | (3,312) | (3,571) | -7.2% | | Impairment loss | (1,412) | – | N/A | | Finance costs | (523) | (2,145) | -75.6% | | Other expenses | (17,962) | (21,498) | -16.5% | | Loss before taxation | (1,282) | (13,463) | -90.5% | | Income tax (expense)/credit | (2,172) | 239 | N/A | | Loss for the period | (3,454) | (13,224) | -73.9% | | Attributable to Owners | (2,312) | (10,588) | -78.2% | | Attributable to Non-controlling interests | (1,142) | (2,636) | -56.7% | | Basic Loss per share (RMB cents) | (0.5445) | (7.6560) | -92.9% | - Loss for the period significantly narrowed by 73.9%, primarily due to substantial revenue growth and reduced finance costs, employee benefits expenses, and other expenses[14][126] - Basic loss per share decreased by 92.9% from RMB 7.6560 cents in the same period of 2024 to RMB 0.5445 cents in H1 2025[14] Condensed Consolidated Statement of Comprehensive Income The Group's total comprehensive expense for H1 2025 significantly decreased by 80.7% to RMB 2.9 million, mainly due to a narrower loss for the period and a favorable exchange difference Condensed Consolidated Statement of Comprehensive Income Key Data (Six Months Ended June 30) | Indicator | 2025 H1 (RMB'000) | 2024 H1 (RMB'000) | Change (%) | | :--- | :--- | :--- | :--- | | Loss for the period | (3,454) | (13,224) | -73.9% | | Other comprehensive income/(expense) | 598 | (1,604) | N/A | | Total comprehensive expense for the period | (2,856) | (14,828) | -80.7% | | Attributable to Owners | (1,714) | (12,192) | -85.9% | | Attributable to Non-controlling interests | (1,142) | (2,636) | -56.7% | - Total comprehensive expense for the period significantly decreased by 80.7% from approximately RMB 14.8 million in the same period of 2024 to approximately RMB 2.9 million in H1 2025[15][126] - Exchange differences arising from translation of overseas operations turned from an expense of RMB 1.6 million in H1 2024 to an income of RMB 0.6 million in H1 2025[15] Condensed Consolidated Statement of Financial Position As of June 30, 2025, the Group's total assets increased by 7.5% to RMB 276.1 million, driven by a 41.9% rise in current assets, while total equity grew by 42.4% to RMB 190.0 million Condensed Consolidated Statement of Financial Position Key Data (As of June 30, 2025) | Indicator | June 30, 2025 (RMB'000) | December 31, 2024 (RMB'000) | Change (%) | | :--- | :--- | :--- | :--- | | Assets | | | | | Total non-current assets | 33,349 | 85,722 | -61.1% | | Total current assets | 242,719 | 171,105 | +41.9% | | Total assets | 276,068 | 256,827 | +7.5% | | Equity | | | | | Equity attributable to owners of the Company | 187,988 | 129,943 | +44.7% | | Non-controlling interests | 2,035 | 3,475 | -41.4% | | Total equity | 190,023 | 133,418 | +42.4% | | Liabilities | | | | | Total non-current liabilities | 723 | 12,696 | -94.3% | | Total current liabilities | 85,322 | 110,713 | -23.0% | | Total liabilities | 86,045 | 123,409 | -30.3% | - Total current assets increased by 41.9% to RMB 242.7 million, primarily due to a significant increase in cash and cash equivalents[16] - Total non-current assets decreased by 61.1% to RMB 33.3 million, mainly due to reduced deposits for property, plant and equipment purchases, and amortization of goodwill and intangible assets[16] - Total equity increased by 42.4% to RMB 190.0 million, reflecting the impact of proceeds from the rights issue[16][18] Condensed Consolidated Statement of Changes in Equity Equity attributable to owners increased by 44.7% to RMB 188.0 million for H1 2025, primarily due to net proceeds from the rights issue, despite a loss for the period Condensed Consolidated Statement of Changes in Equity Key Data (Six Months Ended June 30) | Indicator | 2025 H1 (RMB'000) | 2024 H1 (RMB'000) | | :--- | :--- | :--- | | At beginning of period (audited) | 129,943 | 138,456 | | Loss for the period | (2,312) | (10,588) | | Exchange differences arising from translation of overseas operations | 598 | (1,604) | | Total comprehensive expense | (1,714) | (12,192) | | Proceeds from rights issue | 59,759 | – | | Reversal of non-controlling interests on disposal of subsidiaries | (298) | – | | Shares issued through placing | – | 16,474 | | At end of period (unaudited) | 187,988 | 142,738 | - Equity attributable to owners of the Company increased from approximately RMB 129.9 million as of January 1, 2025, to approximately RMB 188.0 million as of June 30, 2025[18] - The rights issue generated RMB 59.8 million in proceeds for the Group, significantly enhancing share capital[18] - Loss for the period was RMB 2.3 million, but this was offset by the proceeds from the rights issue, leading to an overall increase in total equity[18] Condensed Consolidated Statement of Cash Flows The Group's operating cash flow turned positive with a net inflow of RMB 20.3 million in H1 2025, and financing cash inflow surged by 732.4% to RMB 53.7 million, boosting cash and cash equivalents by 49.4% Condensed Consolidated Statement of Cash Flows Key Data (Six Months Ended June 30) | Indicator | 2025 H1 (RMB'000) | 2024 H1 (RMB'000) | Change (%) | | :--- | :--- | :--- | :--- | | Net cash generated from/(used in) operating activities | 20,345 | (25,694) | N/A (turned positive) | | Net cash (used in)/generated from investing activities | (664) | 25,450 | N/A (turned negative) | | Net cash generated from financing activities | 53,662 | 6,447 | +732.4% | | Net increase in cash and cash equivalents | 73,343 | 6,203 | +1082.4% | | Cash and cash equivalents at end of the period | 123,664 | 82,796 | +49.4% | - Net cash generated from operating activities turned from a net outflow of RMB 25.7 million in H1 2024 to a net inflow of RMB 20.3 million in H1 2025, indicating improved operational performance[19] - Net cash generated from financing activities significantly increased by 732.4% to RMB 53.7 million, primarily influenced by the proceeds from the rights issue[19] - Cash and cash equivalents at the end of the period increased by 49.4% to RMB 123.7 million[19] Notes to the Condensed Consolidated Financial Statements General Information Lecoo International Holdings Group Limited is an investment holding company primarily engaged in transportation, warehousing, in-plant logistics, customized services, and sales of goat milk powder and other products - The company is an investment holding company, with principal activities including transportation, warehousing, in-plant logistics, customized services, and sales of goat milk powder and other products[21][23] - The condensed consolidated financial statements are presented in RMB and have been reviewed by the Audit Committee but are unaudited by the company's auditor[22][23] Basis of Preparation and Accounting Policies The condensed consolidated financial statements are prepared in accordance with HKFRSs, adopting all new and revised standards, with no significant impact from new standards this period - The financial statements are prepared in accordance with Hong Kong Financial Reporting Standards (HKFRSs) and have adopted all relevant new and revised standards[24][25][27] - The new or revised standards adopted during the period had no significant impact on the Group's condensed consolidated interim financial information[26][27] Revenue The Group's H1 2025 revenue surged by 96.1% to RMB 185.7 million, primarily driven by strong growth in transportation services, with goat milk powder sales as a new revenue stream Revenue by Service Type (Six Months Ended June 30) | Service Type | 2025 (RMB'000) | 2024 (RMB'000) | Change (%) | | :--- | :--- | :--- | :--- | | Transportation services | 148,780 | 48,746 | +205.2% | | Warehousing services | 7,440 | 17,509 | -57.5% | | In-plant logistics services | 26,757 | 27,617 | -3.1% | | Customized services | 740 | 829 | -10.8% | | Sales of goat milk powder and other products | 1,939 | – | N/A | | Total | 185,656 | 94,701 | +96.1% | - Transportation services revenue significantly increased by 205.2% to RMB 148.8 million, being the main contributor to total revenue growth[29] - Warehousing services revenue decreased by 57.5%, while in-plant logistics services revenue slightly decreased by 3.1%[29] - Sales of goat milk powder and other products is a new business in H1 2025, contributing RMB 1.9 million in revenue[29] Segment Information The Group's operating segments include transportation, warehousing, in-plant logistics, customized services, and goat milk powder sales, with transportation services showing significant growth in H1 2025 Revenue and Results by Operating Segment (Six Months Ended June 30) | Segment | 2025 Revenue (RMB'000) | 2025 Segment Results (RMB'000) | 2024 Revenue (RMB'000) | 2024 Segment Results (RMB'000) | | :--- | :--- | :--- | :--- | :--- | | Transportation services | 148,780 | 12,485 | 48,746 | 3,305 | | Warehousing services | 7,440 | (1,019) | 17,509 | (55) | | In-plant logistics services | 26,757 | 3,668 | 27,617 | 3,249 | | Customized services | 740 | 477 | 829 | 182 | | Sales of goat milk powder and other products | 1,939 | 48 | – | – | | Total | 185,656 | 15,659 | 94,701 | 6,681 | - The transportation services segment saw significant growth in both revenue and results, with segment results reaching RMB 12.5 million in H1 2025[40] - The warehousing services segment recorded a loss of RMB 1.0 million in H1 2025, compared to a slight loss in the same period of 2024[40] - Approximately 100% (2024: approximately 96%) of the Group's revenue from external customers was derived from China[45][47] Other Income and Net Gains The Group's other income and net gains for H1 2025 amounted to RMB 3.0 million, a decrease from RMB 3.9 million in the prior year, mainly due to reduced interest income from loans receivable Other Income and Net Gains Details (Six Months Ended June 30) | Indicator | 2025 (RMB'000) | 2024 (RMB'000) | | :--- | :--- | :--- | | Bank deposit interest income | 205 | 313 | | Interest income from loans receivable | 1,055 | 1,676 | | Interest income on lease deposits | – | 17 | | Net exchange gains | 1,751 | 1,730 | | Others | (28) | 159 | | Total | 2,983 | 3,895 | - Interest income from loans receivable decreased from approximately RMB 1.7 million in H1 2024 to approximately RMB 1.1 million in H1 2025[49][111] - Net exchange gains remained stable at approximately RMB 1.75 million[49] Finance Costs The Group's finance costs significantly decreased by 75.6% to RMB 0.5 million in H1 2025, primarily due to reduced bank loan interest following the disposal of Haihui Group Finance Costs Details (Six Months Ended June 30) | Indicator | 2025 (RMB'000) | 2024 (RMB'000) | | :--- | :--- | :--- | | Interest on bank borrowings | 260 | 1,470 | | Interest on lease liabilities | 263 | 675 | | Total | 523 | 2,145 | - Bank borrowing interest significantly decreased from approximately RMB 1.5 million in H1 2024 to approximately RMB 0.3 million in H1 2025[51][121] - Interest on lease liabilities also decreased from approximately RMB 0.7 million in H1 2024 to approximately RMB 0.3 million[51] Other Expenses The Group's total other expenses decreased by 16.5% to RMB 18.0 million in H1 2025, mainly due to reduced auditor's remuneration, entertainment, and other operating expenses, despite increased outsourced labor and fleet operating costs Other Expenses Details (Six Months Ended June 30) | Indicator | 2025 (RMB'000) | 2024 (RMB'000) | | :--- | :--- | :--- | | Auditor's remuneration | 380 | 1,364 | | Cost of inventories | 1,891 | – | | Entertainment expenses | 641 | 1,030 | | Lease payments relating to short-term leases | 2,009 | 2,861 | | Fleet operating expenses | 1,825 | 289 | | Insurance expenses | 315 | 301 | | Legal and professional fees | 2,139 | 1,357 | | Other taxes and surcharges | 269 | 156 | | Outsourced labor costs | 5,658 | 4,426 | | Repair and maintenance expenses | 224 | 899 | | Telephone and telecommunication charges | 177 | 185 | | Travel expenses | 435 | 714 | | Utilities expenses | 292 | 251 | | Other operating expenses | 1,707 | 7,665 | | Total | 17,962 | 21,498 | - Outsourced labor costs increased from approximately RMB 4.4 million in H1 2024 to approximately RMB 5.7 million in H1 2025[53] - Fleet operating expenses significantly increased from RMB 0.3 million to RMB 1.8 million[53] - Other operating expenses significantly decreased from approximately RMB 7.7 million in H1 2024 to approximately RMB 1.7 million in H1 2025[53] Income Tax (Expense)/Credit The Group recorded an income tax expense of RMB 2.2 million in H1 2025, compared to an income tax credit of RMB 0.2 million in the prior year, with Chinese subsidiaries not accruing corporate income tax due to tax losses Income Tax (Expense)/Credit Details (Six Months Ended June 30) | Indicator | 2025 (RMB'000) | 2024 (RMB'000) | | :--- | :--- | :--- | | China corporate income tax — Current period | (2,172) | – | | China corporate income tax — Over-provision | – | 29 | | Other jurisdictions — Current period | – | (575) | | Deferred tax — Current period | – | 785 | | Income tax (expense)/credit | (2,172) | 239 | - Hong Kong profits tax is calculated at 16.5%, but no provision was made as no income was generated in Hong Kong[54][57] - China corporate income tax is calculated at 25%, but one high-tech enterprise subsidiary enjoys a preferential tax rate of 15%[55][57] - Chinese-established subsidiaries did not accrue corporate income tax provision for the current and prior periods due to tax losses[55][57] Loss Per Share The Group's basic and diluted loss per share for H1 2025 was RMB 0.5445 cents, a significant reduction from RMB 7.6560 cents in H1 2024, due to narrower loss and increased weighted average shares from the rights issue Loss Per Share Calculation Data (Six Months Ended June 30) | Indicator | 2025 (RMB'000) | 2024 (RMB'000) | | :--- | :--- | :--- | | Loss for the period attributable to owners of the Company | (2,312) | (10,588) | | Weighted average number of ordinary shares for basic loss per share | 424,599,431 | 138,297,073 | | Weighted average number of ordinary shares for diluted loss per share | 424,599,431 | 138,297,073 | | Basic Loss per share (RMB cents) | (0.5445) | (7.6560) | | Diluted Loss per share (RMB cents) | (0.5445) | (7.6560) | - Basic loss per share has been adjusted to reflect the bonus element in the rights issue in May 2025[61][62] - The weighted average number of ordinary shares for the same period in 2024 has been retrospectively adjusted to reflect the share consolidation completed in November 2024[61][62] - No share options were exercised, lapsed, cancelled, or forfeited, and no potential ordinary shares arose from share options for the six months ended June 30, 2025[61][62] Trade and Other Receivables As of June 30, 2025, the Group's current portion of trade and other receivables increased by 31.7% to RMB 107.0 million, mainly due to higher trade receivables from customer contracts Trade and Other Receivables Details (As of June 30, 2025) | Indicator | June 30, 2025 (RMB'000) | December 31, 2024 (RMB'000) | | :--- | :--- | :--- | | Trade receivables from contracts with customers | 81,365 | 67,832 | | Prepayments | 15,301 | 8,439 | | Other receivables | 2,854 | 3,279 | | Lease deposits | 2,781 | 3,602 | | Loans receivable | 18,218 | 18,635 | | Less: Non-current portion — Loans receivable | (11,623) | (17,892) | | Less: Non-current portion — Lease deposits | (1,888) | (2,671) | | Current portion | 107,008 | 81,224 | Trade Receivables Ageing Analysis (As of June 30, 2025) | Ageing | 2025 (RMB'000) | 2024 (RMB'000) | | :--- | :--- | :--- | | Within 30 days | 75,362 | 63,292 | | 31 to 90 days | 2,883 | 3,141 | | 91 to 180 days | 894 | 206 | | Over 180 days | 2,226 | 1,193 | | Total | 81,365 | 67,832 | - Trade receivables (net of impairment) increased by 20.0% to RMB 81.4 million, with the largest portion due within 30 days[64][66] - As of June 30, 2025, the Group's total outstanding loan principal was approximately RMB 24.8 million, comprising 3 corporate loans and 1 individual loan, with annual interest rates ranging from approximately 6% to 12%, all unsecured[69][70] Trade and Other Payables As of June 30, 2025, the Group's total trade and other payables increased by 57.0% to RMB 75.8 million, primarily due to a significant rise in trade payables, with the largest portion due within 30 days Trade and Other Payables Details (As of June 30, 2025) | Indicator | June 30, 2025 (RMB'000) | December 31, 2024 (RMB'000) | | :--- | :--- | :--- | | Trade payables | 71,659 | 38,695 | | Accrued employee benefits | 780 | 5,252 | | Other accrued expenses and other taxes payable | 489 | 1,829 | | Other payables | 2,902 | 2,518 | | Total | 75,830 | 48,294 | Trade Payables Ageing Analysis (As of June 30, 2025) | Ageing | 2025 (RMB'000) | 2024 (RMB'000) | | :--- | :--- | :--- | | 1 to 30 days | 40,785 | 28,757 | | 31 to 60 days | 11,558 | 4,012 | | 61 to 90 days | 17,890 | 1,616 | | Over 90 days | 1,426 | 4,310 | | Total | 71,659 | 38,695 | - Trade payables increased by 85.2% from approximately RMB 38.7 million as of December 31, 2024, to approximately RMB 71.7 million as of June 30, 2025[71] - Credit terms granted by suppliers primarily range from 30 to 90 days[72] Share Capital The company completed a rights issue in May 2025, issuing 533,664,000 rights shares and raising net proceeds of approximately HK$67.6 million, significantly increasing total issued shares to 667,080,000 Share Capital Movement (As of June 30, 2025) | Indicator | Number of Shares | Share Capital (HK$) | | :--- | :--- | :--- | | Authorized share capital at January 1, 2024 | 10,000,000,000 | 100,000,000 | | Share consolidation | (9,000,000,000) | – | | Authorized share capital at June 30, 2025 | 1,000,000,000 | 100,000,000 | | Issued and fully paid at January 1, 2024 | 1,141,280,000 | 11,412,800 | | Shares issued through placing | 192,880,000 | 1,928,800 | | Share consolidation | (1,200,744,000) | – | | Issued and fully paid at January 1, 2025 | 133,416,000 | 13,341,600 | | Shares to be issued under rights issue | 533,664,000 | 53,366,400 | | Issued and fully paid at June 30, 2025 | 667,080,000 | 66,708,000 | - On November 6, 2024, every ten shares of HK$0.01 par value were consolidated into one share of HK$0.10 par value[77] - The company completed a rights issue on May 16, 2025, issuing 533,664,000 rights shares and raising net proceeds of approximately HK$67.6 million[77][78][139] - As of June 30, 2025, the company had a total of 667,080,000 issued shares of HK$0.1 par value[76][140] Disposal of Subsidiaries The Group disposed of a 60% equity interest in Zhongshan Haihui Keqi Logistics (Group) Co., Ltd. for RMB 1 in January 2025, resulting in a recognized loss on disposal of approximately RMB 2.1 million - The Group entered into an agreement on December 20, 2024, to dispose of a 60% equity interest in Zhongshan Haihui Keqi Logistics (Group) Co., Ltd. for a consideration of RMB 1[79][83] - The buyer acquired the shareholder loan for RMB 7,000,000[80][83] - The disposal was approved by an extraordinary general meeting of shareholders on January 27, 2025, and a loss on disposal of approximately RMB 2.1 million was recognized for the period ended June 30, 2025[82][83][115] Dividend The Board of Directors does not recommend the payment of an interim dividend for the six months ended June 30, 2025 (2024: nil) - The Board of Directors does not recommend the payment of an interim dividend for the six months ended June 30, 2025[85][87] Events After the Reporting Period On July 8, 2025, the Group acquired 100% equity of Bozhou Lelaohao Pharmaceutical Co., Ltd. for RMB 900,000 to diversify into pharmaceutical wholesale and medical device sales - On July 8, 2025, the Group acquired 100% equity interest in Bozhou Lelaohao Pharmaceutical Co., Ltd. for a total consideration of RMB 900,000[86][88] - The target company is primarily engaged in wholesale and distribution of pharmaceuticals, sales of Class I and Class II medical devices, and wholesale of protective medical supplies for healthcare personnel[86][88] - Upon completion of the acquisition, the target company became an indirect wholly-owned subsidiary of the company, and its financial results will be consolidated[86][88] Management Discussion and Analysis Business Review In H1 2025, the Group's revenue significantly increased amidst China's logistics sector recovery, validating its strategic transformation, while strict cost controls helped narrow net losses despite market challenges - The Group is a logistics service provider in China, offering transportation, warehousing, in-plant logistics, customized services, and sales of goat milk powder[90][93] - In H1 2025, China's total social logistics volume grew by 5.6% year-on-year, indicating a continuous recovery in the logistics industry, which presented opportunities for the Group[92][94] - The Group's revenue significantly increased compared to the same period last year, confirming the success of its strategic transformation, primarily through expanding high-value customer relationships and strengthening its core hub network[92][94] - Challenges included weakened manufacturing investment sentiment, significantly increased outsourcing costs, and rising diesel prices due to international crude oil price fluctuations[95][97] - Through strict cost control measures, optimizing organizational efficiency, reducing payroll and administrative costs, and implementing digital approval and centralized procurement, the Group's net loss significantly narrowed[96][97] Outlook For H2 2025, China's logistics and warehousing sector will continue its intelligent transformation, offering growth in cold chain and pharmaceutical logistics, while the Group plans to optimize its network, introduce smart equipment, and diversify into goat milk products and traditional Chinese medicine logistics - China's logistics and warehousing industry is expected to continue structural growth, driven by government policies and market demand[98][100] - Intelligent upgrades, improved urban-rural distribution networks, and emerging sectors like cold chain and pharmaceutical logistics will create development opportunities[98][100] - The industry faces challenges such as supply-demand imbalance in warehousing facilities, energy price volatility, labor shortages, and accelerating market consolidation[99][101] - The Group will implement an innovation-driven, efficiency-centric strategy, optimizing its warehousing network and introducing smart equipment and digital management platforms[102][103] - To diversify its business, the Group commenced goat milk product operations in Inner Mongolia at the end of 2024 and began selling goat milk powder in H1 2025[102][103] - The Group will deepen cooperation with Traditional Chinese Medicine stakeholders to develop storage and distribution services for TCM products, including developing logistics facilities on its Fuzhou land use rights[102][103] Financial Review The Group's H1 2025 financial performance significantly improved, with substantial revenue growth and a narrower loss. Transportation services were the main growth driver, and the goat milk powder business was a new contributor. Cost control measures effectively reduced employee benefits and finance costs, but sub-contracting expenses increased due to business expansion Revenue The Group's H1 2025 revenue surged by 96.1% to RMB 185.7 million, primarily driven by a 205.5% increase in transportation services revenue and expansion into new regions, with goat milk powder sales as a new revenue source - For the six months ended June 30, 2025, the Group's revenue significantly increased by 96.1% to approximately RMB 185.7 million[104] - Transportation services revenue increased by 205.5% to approximately RMB 148.8 million, benefiting from the recovery in domestic logistics service demand in China and business expansion into Hangzhou and Inner Mongolia[104] - Warehousing services revenue decreased by 57.7% to approximately RMB 7.4 million, mainly due to reduced demand after the disposal of Haihui Group[105][107] - Starting from H1 2025, the Group commenced sales of goat milk powder and other products in Inner Mongolia Autonomous Region, contributing approximately RMB 1.9 million in revenue[110][113] Other income and net gains The Group's other income and net gains for H1 2025 were approximately RMB 3.0 million, a decrease from the prior year, mainly due to a reduction of approximately RMB 0.6 million in interest income from loans receivable - Net gains of approximately RMB 3.0 million were recognized for the six months ended June 30, 2025 (2024: approximately RMB 3.9 million)[111][114] - This was primarily due to a decrease of approximately RMB 0.6 million in interest income from loans receivable during the period[111][114] Loss on disposal of subsidiaries The Group recognized a loss on disposal of approximately RMB 2.1 million for the period ended June 30, 2025, due to the disposal of a 60% equity interest in Zhongshan Haihui Keqi Logistics (Group) Co., Ltd - A loss on disposal of approximately RMB 2.1 million was recognized for the period ended June 30, 2025, due to the disposal of a 60% equity interest in Zhongshan Haihui Keqi Logistics (Group) Co., Ltd.[112][115] Employee benefits expenses The Group's employee benefits expenses decreased by 27.0% to approximately RMB 26.8 million in H1 2025, mainly due to strict cost control measures and reduced labor costs after the disposal of Haihui Group - Employee benefits expenses were approximately RMB 26.8 million for the six months ended June 30, 2025 (2024: approximately RMB 36.8 million)[116][118] - The decrease was primarily due to strict cost control measures implemented by the Group's subsidiaries and reduced labor costs following the disposal of Haihui Group during the period[116][118] Sub-contracting expenses The Group's sub-contracting expenses significantly increased by 186.6% to approximately RMB 137.8 million in H1 2025, driven by higher revenue and increased demand for outsourced local transportation and international freight forwarding services - Sub-contracting expenses were approximately RMB 137.8 million for the six months ended June 30, 2025 (2024: approximately RMB 48.1 million)[117][119] - The significant increase in sub-contracting expenses was primarily due to higher revenue during the period and increased customer orders for local transportation services and international freight forwarding services[117][119] Depreciation of right-of-use assets The Group's depreciation of right-of-use assets was approximately RMB 3.0 million in H1 2025, a slight decrease from the prior year, mainly related to leases for warehouses, office properties, and plant machinery - Depreciation of right-of-use assets was approximately RMB 3.0 million for the six months ended June 30, 2025 (2024: approximately RMB 3.2 million)[120][123] - Right-of-use assets include leases for warehouses, office properties, temporary staff dormitories, and plant machinery such as forklifts[120][123] Finance costs The Group's finance costs significantly decreased by 75.6% to approximately RMB 0.5 million in H1 2025, primarily due to reduced bank loan interest following the disposal of Haihui Group in January 2025 - Finance costs decreased from approximately RMB 2.1 million in H1 2024 to approximately RMB 0.5 million in H1 2025[121][124] - This was primarily attributable to reduced bank loan interest following the disposal of Haihui Group in January 2025[121][124] Other expenses The Group's total other expenses were approximately RMB 18.0 million in H1 2025, a decrease from RMB 21.5 million in the prior year, primarily comprising outsourced labor costs, short-term lease payments, and legal and professional fees - Other expenses were approximately RMB 18.0 million for the six months ended June 30, 2025 (2024: approximately RMB 21.5 million)[122][125] - Key expense items include outsourced labor costs, short-term lease-related payments, auditor's remuneration, legal and professional fees, fleet vehicle operating expenses, and inventory costs[122][125] Loss and total comprehensive expense for the period The Group's loss for the period and total comprehensive expense for H1 2025 significantly narrowed to approximately RMB 3.5 million and RMB 2.9 million, respectively, from RMB 13.2 million and RMB 14.8 million in H1 2024 - Loss for the period was approximately RMB 3.5 million for the six months ended June 30, 2025 (2024: approximately RMB 13.2 million)[126][129] - Total comprehensive expense for the period was approximately RMB 2.9 million (2024: approximately RMB 14.8 million)[126][129] Liquidity and Financial Resources As of June 30, 2025, the Group had net current assets of approximately RMB 157.4 million and cash and cash equivalents of RMB 123.7 million, primarily denominated in HKD and RMB, with the directors confirming sufficient financial resources - As of June 30, 2025, the Group's net current assets were approximately RMB 157.4 million (December 31, 2024: approximately RMB 60.4 million)[127][130] - Cash and cash equivalents were approximately RMB 123.7 million (December 31, 2024: approximately RMB 49.7 million), primarily denominated in HKD and RMB[127][130] - The directors confirm that the Group will have sufficient financial resources to meet its liabilities as they fall due in the foreseeable future[127][130] Funding and Treasury Policies The Group's funding and treasury policies aim to ensure sufficient financial resources for business and investment activities, prudently manage financial risks like interest rate and foreign exchange risks, and maintain a robust balance sheet with ample liquidity - The Group's policy aims to ensure sufficient financial resources to support business and investment activities and to prudently and effectively manage financial risks[128][131] - Interest rate risk and foreign exchange risk are managed through the use of financial instruments and risk management strategies[128][131] - The Group is committed to maintaining a robust balance sheet and ample liquidity to enhance financial flexibility and resilience[128][131] Gearing Ratio As of June 30, 2025, the Group was in a net cash position, rendering the gearing ratio not applicable (December 31, 2024: 4.9%) - The Group monitors its capital based on the percentage of net debt to equity attributable to owners of the Company[132][137] - As of June 30, 2025, the Group was in a net cash position as the amount of time deposits and cash and cash equivalents exceeded the amount of bank and other borrowings and lease liabilities[133][137] - Therefore, the gearing ratio was not applicable as of June 30, 2025 (December 31, 2024: 4.9%)[133][137] Capital Structure The Group's capital structure comprises issued share capital and reserves, with no change in authorized share capital as of June 30, 2025, and a rights issue in May 2025 raising HK$67.6 million and increasing issued shares to 667,080,000 - The Group's capital structure comprises issued share capital and reserves, with the Board of Directors regularly reviewing the capital structure[134][138] - For the six months ended June 30, 2025, there was no change in the company's authorized share capital of HK$100,000,000[135][138] - The company completed a rights issue on May 16, 2025, issuing 533,664,000 rights shares and raising net proceeds of approximately HK$67.6 million[139][145] - Upon completion of the rights issue, as of June 30, 2025, the company had a total of 667,080,000 issued shares of HK$0.1 par value[140][145] Foreign Currency Exposure The Group's operations are primarily RMB-denominated in China, but some subsidiaries face foreign exchange risk from foreign currency sales and purchases, with no current hedging policy, though the Board monitors and considers hedging significant exposures - The Group's business activities are primarily conducted in China and mainly denominated in RMB[141][146] - Certain subsidiaries have sales and purchases denominated in foreign currencies, exposing the Group to foreign exchange risk[141][146] - The Group currently has no foreign currency hedging policy, but the directors will continue to monitor relevant foreign exchange risks and consider hedging when necessary[141][146] Charge on the Group's Assets As of June 30, 2025, the Group had no assets charged, other than those disclosed in this report - As of June 30, 2025, the Group had no charged assets[142][147] Contingent Liabilities As of June 30, 2025, the Group had no significant contingent liabilities, other than those disclosed in this report - As of June 30, 2025, the Group had no significant contingent liabilities[143][148] Capital Commitments As of June 30, 2025, the Group had no significant capital commitments - As of June 30, 2025, the Group had no significant capital commitments[144][149] Significant Investments, Material Acquisitions and Disposals of Subsidiaries and Affiliated Companies For the six months ended June 30, 2025, the Group had no significant investments, material acquisitions, or disposals of subsidiaries and affiliated companies, other than those disclosed in this report - For the six months ended June 30, 2025, the Group had no significant investments, material acquisitions, or disposals of subsidiaries and affiliated companies (other than those disclosed elsewhere in this report)[150][153] Employees and Remuneration Policies As of June 30, 2025, the Group employed 574 full-time employees, with remuneration based on qualifications, responsibilities, contributions, and market conditions, offering retirement plans and share options, alongside training - As of June 30, 2025, the Group employed 574 full-time employees (June 30, 2024: 640 employees)[151][154] - Employee remuneration is determined based on factors such as qualifications, responsibilities, contributions, work experience, prevailing market conditions, and the Group's remuneration policy[151][154] - Employee benefits include contributions to retirement schemes and share options under the company's share option scheme, with both on-the-job and sponsored external training provided[151][154] Future Plans for Material Investments or Capital Assets As of June 30, 2025, the Group had no specific future plans for material investments or capital assets, other than those disclosed in this report - As of June 30, 2025, the Group had no specific future plans for material investments or capital assets (other than those disclosed elsewhere in this report)[152][155] Use of Proceeds The Group detailed the use of proceeds from new share placements in 2023 and 2024, and the 2025 rights issue, with the 2023 proceeds reallocated to TCM business and general working capital, and 2025 proceeds for working capital, goat milk products, and TCM logistics park facilities Use of proceeds from placing of new shares Net proceeds of approximately HK$34.2 million from the 2023 placement, with HK$30.0 million originally for smart logistics, were reallocated on July 25, 2025, to TCM business and general working capital; 2024 placement net proceeds of HK$18.5 million include HK$7.7 million for logistics infrastructure Use of Net Proceeds from 2023 Placing (As of June 30, 2025) | Intended Use | Unutilized as of Dec 31, 2024 (HK$'million) | Actual Utilized during the Period (HK$'million) | Unutilized as of June 30, 2025 (HK$'million) | | :--- | :--- | :--- | :--- | | Development of smart logistics services business | 30.0 | – | 30.0 | - Net proceeds from the 2023 placing were approximately HK$34.2 million, with HK$30.0 million unutilized[156][158] - On July 25, 2025, the Board decided to change the use of unutilized net proceeds from the 2023 placing from 'development of smart logistics services business' to 'development of Traditional Chinese Medicine business' and general working capital[159] Use of Net Proceeds from 2024 Placing (As of June 30, 2025) | Intended Use | Unutilized as of Dec 31, 2024 (HK$'million) | Actual Utilized during the Period (HK$'million) | Unutilized as of June 30, 2025 (HK$'million) | | :--- | :--- | :--- | :--- | | Investment in logistics business infrastructure | 7.7 | – | 7.7 | - Net proceeds from the 2024 placing were approximately HK$18.5 million, with HK$7.7 million allocated for infrastructure investment in logistics business, expected to be utilized by December 31, 2026[160][162][163] Use of proceeds from Rights Issue The company completed a rights issue on May 16, 2025, issuing 533,664,000 rights shares and raising net proceeds of approximately HK$67.6 million, allocated for general working capital, Inner Mongolia goat milk product business, and construction of TCM logistics park facilities in Jiangxi, China - The company proposed a rights issue on February 14, 2025, to issue up to 533,664,000 rights shares at a subscription price of HK$0.13 per share, raising approximately HK$69.4 million (before expenses)[164][168] - The rights issue was completed on May 16, 2025, with all 533,664,000 rights shares fully subscribed, raising net proceeds of approximately HK$67.6 million[139][170][172] Use of Net Proceeds from Rights Issue (As of June 30, 2025) | Intended Use | Intended Use (HK$'million) | Actual Utilized during the Period (HK$'million) | Unutilized as of June 30, 2025 (HK$'million) | | :--- | :--- | :--- | :--- | | General working capital | 27.6 | 26.7 | 0.9 | | Development of goat milk product business in Inner Mongolia Autonomous Region | 20.0 | 15.3 | 4.7 | | Construction of warehouses and/or other logistics-related facilities in the Traditional Chinese Medicine Logistics Industrial Park in Jiangxi Province, China | 20.0 | 20.0 | – | - The proceeds will be used for general working capital, developing the goat milk product business in Inner Mongolia, and constructing warehouses and other logistics-related facilities in the Traditional Chinese Medicine Logistics Industrial Park in Jiangxi Province, China[175] Corporate Governance and other Information Share Option Scheme The company adopted a new share option scheme in November 2023, replacing the previous one, with no options granted or outstanding as of June 30, 2025 - The company adopted a new share option scheme on November 23, 2023, replacing the previous share option scheme[176][180] - Under the new share option scheme, the Board may invite employees, directors, consultants, etc., to subscribe for shares, up to 10% of the issued shares on the listing date[177][180] - As of June 30, 2025, no share options had been granted, exercised, cancelled, or lapsed under the new share option scheme, and no share options remained outstanding[182][184] Directors' and Chief Executive's Interests and Short Positions in Shares, Underlying Shares and Debentures As of June 30, 2025, no directors, chief executive, or their associates held any disclosable interests or short positions in the company's or any associated corporation's shares, underlying shares, or debentures under the SFO - As of June 30, 2025, no directors, chief executive, or their associates had any interests or short positions in the shares, underlying shares, or debentures of the company or any associated corporation that were required to be disclosed under the Securities and Futures Ordinance[183][185] Substantial Shareholders' Interests and Short Positions in Shares and Underlying Shares As of June 30, 2025, to the best knowledge of the directors, no person (other than a director or chief executive) held any disclosable interests or short positions in the company's shares or underlying shares under the SFO - As of June 30, 2025, to the best knowledge of the directors, no person (other than a director or the chief executive of the company) had or was deemed to have any interests or short positions in the shares or underlying shares that were required to be disclosed under the Securities and Futures Ordinance[186][189] Directors' Rights to Acquire Shares or Debentures Other than as disclosed in the share option scheme, for the six months ended June 30, 2025, neither the company nor its subsidiaries participated in any arrangements enabling directors to acquire benefits by acquiring shares or debentures of the company or any other body corporate - Other than as disclosed in the share option scheme, for the six months ended June 30, 2025, neither the company nor any of its subsidiaries was a party to any arrangement to enable the directors to acquire benefits by means of the acquisition of shares in or debentures of the company or any other body corporate[187][190] Purchase, Sale or Redemption of the Company's Listed Securities For the six months ended June 30, 2025, neither the company nor its subsidiaries purchased, sold, or redeemed any of the company's listed securities, and the company held no treasury shares - For the six months ended June 30, 2025, neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities[191] - As of June 30, 2025, the company held no treasury shares[191] Corporate Governance The Board is committed to maintaining high corporate governance standards, having adopted the Corporate Governance Code in Appendix C1 of the Listing Rules, and confirms compliance with its code provisions during the reporting period - The Board is committed to maintaining a high level of corporate governance to uphold the Group's transparency and safeguard shareholders' interests[192][196] - The company has adopted the principles and code provisions of the Corporate Governance Code and Corporate Governance Report as set out in Appendix C1 to the Listing Rules[192][196] - To the best knowledge of the Board, the company has complied with the code provisions of the Corporate Governance Code for the six months ended June 30, 2025, and up to the date of this report[193][196] Competing Interests For the six months ended June 30, 2025, to the best knowledge of the directors, no director, substantial shareholder, or their associates had any business or interest directly or indirectly competing with the Group's business, nor any other conflicts of interest with the company - For the six months ended June 30, 2025, to the best knowledge of the directors, no director, substantial shareholder, or any of their respective associates had any business or interest that competed or might compete, directly or indirectly, with the Group's business[194][197] - There were no other conflicts of interest between any such persons and the company[194][197] Directors' Securities Transactions The company adopted the Model Code for Securities Transactions by Directors of Listed Issuers, and all directors confirmed full compliance for the six months ended June 30, 2025, with no non-compliance incidents - The company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix C3 to the Listing Rules as its code of conduct[195][198] - All directors have confirmed full compliance with the Model Code for the six months ended June 30, 2025, and throughout the period up to the date of this report, with no incidents of non-compliance[195][198] Audit Committee The Audit Committee, comprising three independent non-executive directors chaired by Mr. Liu Weibiao, reviewed the Group's unaudited consolidated financial statements for H1 2025, confirming compliance with applicable accounting standards and adequate disclosure - The primary responsibilities of the Audit Committee include making recommendations on the appointment and removal of external auditors, reviewing financial statements, and overseeing internal control and risk management procedures[199][202] - The Audit Committee comprises three independent non-executive directors: Mr. Liu Weibiao (Chairman), Dr. Wang Yi, and Mr. Zhang Yao[199][202] - The committee has reviewed the Group's unaudited consolidated financial statements for the six months ended June 30, 2025, and is of the opinion that they have been prepared in compliance with applicable accounting standards and made adequate disclosures[199][202] Resignation of Directors Executive Director Mr. Du Yingyou resigned on March 17, 2025, and Independent Non-executive Director Mr. Chen Guanyong resigned on May 22, 2025, ceasing his committee memberships - Executive Director Mr. Du Yingyou resigned on March 17, 2025[200][203] - Independent Non-executive Director Mr. Chen Guanyong resigned on May 22, 2025, and ceased to be a member of the Board's Audit Committee, Remuneration Committee, and Nomination Committee[200][203] Update on Directors' Information Under Rule 13.51B(1) of the Listing Rules During the reporting period, no other information was required to be disclosed under Rule 13.51B(1) of the Listing Rules - During the reporting period, no other information was required to be disclosed under Rule 13.51B(1) of the Listing Rules[201][204] Events After the Reporting Period No significant events occurred after the reporting period, other than those disclosed elsewhere in this report - No significant events occurred after the reporting period, other than those disclosed in this report[205][207]