三爱健康集团(01889) - 2025 - 中期业绩

Interim Results Announcement Condensed Consolidated Financial Statements The Group's unaudited condensed consolidated financial statements for the six months ended June 30, 2025, show a shift from profit to loss, primarily due to reduced one-off gains from subsidiary disposals and increased operating costs, alongside significant increases in current liabilities and interest-bearing borrowings Condensed Consolidated Statement of Profit or Loss For the six months ended June 30, 2025, the Group shifted from profit to loss, as revenue growth failed to offset increased cost of sales, distribution costs, and administrative expenses, coupled with a significant reduction in one-off gains from subsidiary disposals in the prior period Key Figures from Condensed Consolidated Statement of Profit or Loss (RMB thousands) | Metric | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 47,222 | 36,729 | +28.6% | | Cost of Sales and Services | (40,410) | (29,908) | +35.1% | | Gross Profit | 6,812 | 6,821 | -0.1% | | Other (Losses) Income and Other (Losses) Gains, Net | (220) | 2,863 | -107.7% | | Distribution Costs | (4,256) | (2,060) | +106.6% | | Administrative and Other Expenses | (14,517) | (12,131) | +19.7% | | Net Gain on Disposal of Subsidiaries | 606 | 17,043 | -96.4% | | Finance Costs | (1,265) | (1,078) | +17.3% | | (Loss) Profit Before Income Tax | (12,708) | 11,142 | -214.1% | | (Loss) Profit for the Period | (13,379) | 9,655 | -238.6% | | (Loss) Profit for the Period Attributable to Owners of the Company | (10,861) | 9,971 | -208.9% | | Basic (Loss) Earnings Per Share (RMB cents) | (7.10) | 7.24 | -208.6% | Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income For the period, the Group recorded a total comprehensive loss of RMB 18,485 thousand, a significant deterioration from the prior period's total comprehensive income of RMB 5,230 thousand, mainly due to the loss for the period and increased exchange differences on translation of overseas operations Key Figures from Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (RMB thousands) | Metric | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | (Loss) Profit for the Period | (13,379) | 9,655 | -238.6% | | Exchange Differences on Translation of Overseas Operations | (5,106) | (4,425) | +15.4% | | Total Comprehensive (Loss) Income for the Period | (18,485) | 5,230 | -453.5% | | Total Comprehensive (Loss) Income for the Period Attributable to Owners of the Company | (15,967) | 5,546 | -387.9% | Condensed Consolidated Statement of Financial Position As of June 30, 2025, the Group's net assets decreased, current liabilities significantly increased, leading to a reduction in net current assets and pressure on the asset-liability structure Key Figures from Condensed Consolidated Statement of Financial Position (RMB thousands) | Metric | As of June 30, 2025 | As of December 31, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Non-current Assets | 102,500 | 103,421 | -0.9% | | Current Assets | 377,015 | 365,543 | +3.1% | | Current Liabilities | 142,899 | 114,233 | +25.1% | | Net Current Assets | 234,116 | 251,310 | -6.9% | | Non-current Liabilities | 3,368 | 3,125 | +7.8% | | Net Assets | 333,248 | 351,606 | -5.3% | | Equity Attributable to Owners of the Company | 306,022 | 321,987 | -5.0% | | Total Equity | 333,248 | 351,606 | -5.2% | | Cash and Cash Equivalents | 351,235 | 340,426 | +3.2% | | Trade and Other Receivables | 17,588 | 14,993 | +17.3% | | Trade and Other Payables | 86,674 | 74,003 | +17.1% | | Interest-bearing Borrowings | 56,729 | 40,426 | +40.3% | Notes This section details the Group's operations, basis of financial statement preparation, accounting policies, segment information, revenue composition, taxation, dividends, earnings per share calculation, asset and liability changes, subsidiary disposals, capital reorganization, and related party transactions, providing crucial supplementary information for understanding the financial statements 1. General Information Sanai Health Industry Group Co Ltd is incorporated in the Cayman Islands and listed on the Hong Kong Stock Exchange, primarily engaged in the development, manufacturing, marketing, and sales of pharmaceutical products, and providing finance lease services, with financial statements presented in RMB - The company is an investment holding company, with principal businesses including pharmaceutical products and finance lease services[9] - Shares were listed on the Main Board of the Hong Kong Stock Exchange on February 1, 2007[9] 2. Basis of Preparation The unaudited condensed consolidated financial statements are prepared in accordance with Hong Kong Accounting Standard 34 'Interim Financial Reporting' and the Listing Rules of the Stock Exchange, using the historical cost convention and consistent with the accounting policies and methods used in the 2024 audited financial statements - Financial statements are prepared in accordance with Hong Kong Accounting Standard 34 and the Listing Rules of the Stock Exchange[10] - Accounting policies used for preparation are consistent with the 2024 audited financial statements[10] 3. Adoption of New and Revised Hong Kong Financial Reporting Standards The Group has adopted all new and revised Hong Kong Financial Reporting Standards effective January 1, 2025, with no significant changes to accounting policies, financial statement presentation, or reported amounts resulting from these adoptions - The adoption of new and revised Hong Kong Financial Reporting Standards did not result in significant changes to accounting policies or financial statement presentation[11] 4. Segment Information The Group primarily operates in two reportable segments: pharmaceutical products and finance lease, with pharmaceutical products showing significant revenue growth but expanded losses, while the finance lease segment generated zero revenue, and the gene testing and molecular biological diagnostic services segment ceased operations in the second half of 2024 - The Group has two reportable segments: pharmaceutical products and finance lease[12] Segment Revenue and (Loss) Profit (RMB thousands) | Segment | Revenue for the six months ended June 30, 2025 | Revenue for the six months ended June 30, 2024 | Loss for the six months ended June 30, 2025 | (Loss) Profit for the six months ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Pharmaceutical Products | 47,222 | 31,010 | (5,721) | (779) | | Finance Lease | – | – | – | (303) | | Gene Testing and Molecular Biological Diagnostic Services | – | 5,719 | – | 173 | | Total | 47,222 | 36,729 | (5,721) | (909) | - The gene testing and molecular biological diagnostic services segment ceased operations in the second half of 2024[13][19] Revenue from External Customers by Geographical Location (RMB thousands) | Region | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | | :--- | :--- | :--- | | Hong Kong | – | 5,719 | | People's Republic of China ("China") | 47,222 | 31,010 | | Total | 47,222 | 36,729 | 5. Revenue Revenue for the period primarily derived from pharmaceutical product sales, totaling RMB 47,222 thousand, a 28.6% increase from the prior period, with revenue from gene testing and molecular biological diagnostic services having ceased Revenue by Category (RMB thousands) | Revenue Category | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | | :--- | :--- | :--- | | Sales of Pharmaceutical Products | 47,222 | 31,010 | | Provision of Gene Testing and Molecular Biological Diagnostic Services | – | 5,719 | | Total | 47,222 | 36,729 | 6. (Loss) Profit for the Period The loss for the period was primarily impacted by increased finance costs, higher depreciation of property, plant and equipment, and rising inventory costs Items Deducted in Calculating (Loss) Profit for the Period (RMB thousands) | Item | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | | :--- | :--- | :--- | | Finance Costs | 1,265 | 1,078 | | Depreciation of Property, Plant and Equipment | 1,088 | 545 | | Amortisation of Intangible Assets | – | 24 | | Cost of Inventories | 33,296 | 24,960 | 7. Income Tax Expense Income tax expense for the period was RMB 671 thousand, a decrease from RMB 1,487 thousand in the prior period, mainly due to reduced PRC corporate income tax and no provision for Hong Kong profits tax due to the absence of assessable profits Income Tax Expense (RMB thousands) | Tax Category | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | | :--- | :--- | :--- | | PRC Corporate Income Tax | 143 | 1,522 | | Deferred Tax | 528 | (82) | | Hong Kong Profits Tax | – | 47 | | Total | 671 | 1,487 | - Beijing Hangyang, as a high-tech enterprise, enjoys a preferential tax rate of 15%[25] - No Hong Kong profits tax provision was made for the period as Hong Kong subsidiaries had no assessable profits[26] 8. Dividends The Board does not recommend the payment of any dividends for the six months ended June 30, 2025, and 2024 - The Board does not recommend the payment of an interim dividend[27] 9. (Loss) Earnings Per Share For the six months ended June 30, 2025, both basic and diluted loss per share were RMB 7.10 cents, compared to earnings per share of RMB 7.24 cents in the prior period, primarily reflecting the shift from profit to loss (Loss) Earnings Per Share (RMB cents) | Metric | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | | :--- | :--- | :--- | | Basic (Loss) Earnings | (7.10) | 7.24 | | Diluted (Loss) Earnings | (7.10) | 7.24 | Data Used for Calculating (Loss) Earnings Per Share (RMB thousands/thousands of shares) | Item | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | | :--- | :--- | :--- | | (Loss) Profit for the Period Attributable to Owners of the Company | (10,861) | 9,971 | | Weighted Average Number of Ordinary Shares | 152,899 | 137,693 | 10. Property, Plant and Equipment and Right-of-use Assets During the period, the Group acquired property, plant and equipment of approximately RMB 41 thousand and disposed of property, plant and equipment of approximately RMB 29 thousand through the disposal of subsidiaries - Acquisition of property, plant and equipment amounted to approximately RMB 41 thousand during the period[30] - Disposal of property, plant and equipment through the sale of subsidiaries amounted to approximately RMB 29 thousand[30] 11. Trade and Other Receivables As of June 30, 2025, total trade and other receivables amounted to RMB 17,588 thousand, an increase from December 31, 2024, primarily due to higher other receivables Trade and Other Receivables (RMB thousands) | Item | As of June 30, 2025 | As of December 31, 2024 | | :--- | :--- | :--- | | Trade Receivables (net of loss allowance) | 8,656 | 9,560 | | Other Receivables | 7,603 | 3,190 | | Prepayments and Deposits | 925 | 1,832 | | Total | 17,588 | 14,993 | - The Group generally grants credit periods of 30 to 180 days to customers[31] 12. Trade and Other Payables As of June 30, 2025, total trade and other payables amounted to RMB 86,674 thousand, a significant increase from December 31, 2024, primarily due to higher other payables and interest payable Trade and Other Payables (RMB thousands) | Item | As of June 30, 2025 | As of December 31, 2024 | | :--- | :--- | :--- | | Trade Payables | 12,864 | 14,285 | | Other Payables | 54,207 | 36,322 | | Interest Payable | 2,152 | 1,272 | | Total | 86,674 | 74,003 | 13. Interest-bearing Borrowings As of June 30, 2025, the Group's total interest-bearing borrowings amounted to RMB 56,729 thousand, a substantial increase from December 31, 2024, primarily driven by growth in unsecured bank and other borrowings Interest-bearing Borrowings (RMB thousands) | Item | As of June 30, 2025 | As of December 31, 2024 | | :--- | :--- | :--- | | Unsecured Bank and Other Borrowings | 31,229 | 13,426 | | Secured and Guaranteed Bank Borrowings | 25,500 | 27,000 | | Total | 56,729 | 40,426 | - Unsecured borrowings bear interest at fixed annual rates ranging from 3% to 12%[37] - Secured borrowings are pledged and guaranteed by right-of-use assets[37] 14. Disposal of Subsidiaries During the period, the Group disposed of 100% equity in Fujian Zhixin Pharmaceutical Co Ltd and indirect equity in two companies held by Beijing Hangyang Information Technology Co Ltd, generating gains, while the prior period also saw multiple subsidiary disposals, including Zentrogene Group, which yielded significant gains - On March 28, 2025, 100% equity in Fujian Zhixin Pharmaceutical Co Ltd was disposed of for a cash consideration of RMB 300 thousand[38] - On January 17, 2025, Beijing Hangyang indirectly disposed of 55% equity in Beijing Sanai Baicheng Commercial Management Co Ltd and 74% equity in Zhongshi Haowu (Beijing) International Culture and Tourism Co Ltd for a total cash consideration of RMB 150 thousand[39][40] - In the prior period of 2024, 51% equity in Fujian Yongchun Pharmaceutical Co Ltd, 100% equity in Jianwei Electronics (Hong Kong) Co Ltd, and 59% equity in Zentrogene Group were disposed of, with the Zentrogene disposal generating a gain of RMB 17,167 thousand[41][42][44] 15. Share Capital The Company completed a share consolidation on August 13, 2024, and a capital reduction and share subdivision on February 3, 2025, resulting in a decrease in par value per share from HK$0.25 to HK$0.01, while the number of issued ordinary shares remained unchanged - The share consolidation became effective on August 13, 2024, where every 25 ordinary shares of HK$0.01 par value were consolidated into 1 share of HK$0.25 par value[46] - The capital reduction and share subdivision became effective on February 3, 2025, reducing the par value per share from HK$0.25 to HK$0.01[46] Changes in Share Capital (RMB thousands) | Item | As of June 30, 2025 | As of December 31, 2024 | | :--- | :--- | :--- | | Share Capital as presented in the Condensed Consolidated Statement of Financial Position | 1,421 | 35,534 | 16. Significant Related Party Transactions For the six months ended June 30, 2025, key management personnel compensation, representing amounts paid to the Company's directors, was RMB 1,197 thousand, a slight decrease from the prior period Key Management Personnel Compensation (RMB thousands) | Item | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | | :--- | :--- | :--- | | Short-term Employee Benefits | 1,197 | 1,245 | Management Discussion and Analysis The Management Discussion and Analysis section provides a detailed review of the Group's core pharmaceutical products and finance lease businesses, outlines future prospects, and offers in-depth analysis of key aspects including financial performance, liquidity, capital structure, employee matters, significant litigation, and corporate governance Business Review The Group primarily engages in pharmaceutical products and finance lease businesses, with pharmaceutical products benefiting from the Beijing Hangyang acquisition for revenue growth, though gross margin was impacted by rising traditional Chinese medicine costs, while the finance lease business generated zero revenue due to a cautious strategy and no new contracts Pharmaceutical Products Business Pharmaceutical products business revenue grew by 52.3% to approximately RMB 47.22 million, primarily due to Beijing Hangyang's contribution, but rising traditional Chinese medicine costs continued to adversely affect gross margin and sales volume, expanding the business loss to RMB 5.72 million - Pharmaceutical products business revenue increased by 52.3% to approximately RMB 47.22 million[50] - Beijing Hangyang became a significant revenue source for the pharmaceutical products business, accounting for approximately 64.48% of total revenue[49] - Significant increases in the cost of traditional Chinese medicinal materials and supply shortages continued to adversely affect gross margin and sales volume[49] - The pharmaceutical products business loss expanded to approximately RMB 5.72 million, compared to a loss of RMB 0.78 million in the prior period[50] Finance Lease Business Finance lease business revenue was zero for the period as all existing contracts expired and no new contracts were entered into, with the Group adopting a more cautious approach to new finance lease loans, primarily offering finance lease services for medical devices and rehabilitation equipment - Finance lease business revenue was zero for the period, as all existing contracts expired and no new contracts were entered into[51] - The Group adopted a more cautious approach to evaluating and granting new finance lease loans[51] - The finance lease business primarily provides finance lease services for medical devices and rehabilitation equipment, with strict approval procedures and risk management measures in place[52][53][54] Prospects The Company will continue to focus on China's macroeconomic environment, actively assess opportunities and challenges, and enhance financial performance and implement cost controls through digital transformation and operational efficiency improvements, with pharmaceutical products business expected to maintain stable growth despite ongoing gross margin pressure from traditional Chinese medicine costs, and the finance lease business continuing a cautious approach - The Company's strategy focuses on China's macroeconomic environment, exploring new business investment opportunities, and enhancing market position[57] - Strict cost control measures will be implemented, with investments in digital transformation and operational efficiency to enhance productivity and reduce costs[58] - The pharmaceutical products business is expected to maintain stable growth in the second half of 2025, but gross margin will continue to be adversely affected by traditional Chinese medicine costs[58] - The finance lease business will continue to adopt a cautious approach, closely monitoring market developments and interest rate trends[58] Financial Performance Review During the period, the Group's revenue grew, but distribution and administrative expenses significantly increased, and gross margin declined, ultimately resulting in a loss attributable to owners of the Company, a stark contrast to the profit in the prior period Revenue The Group's total revenue was approximately RMB 47.22 million, an increase of approximately 28.6% from the prior period, primarily due to increased revenue from pharmaceutical product sales by Beijing Hangyang Total Revenue (RMB millions) | Metric | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Total Revenue | 47.22 | 36.73 | +28.6% | - The increase in revenue was primarily due to increased revenue from pharmaceutical product sales by Beijing Hangyang during the period[59] Distribution Costs Distribution costs were approximately RMB 4.26 million, a significant increase of 106.6% from the prior period, mainly due to new marketing and promotional activities, and the full recognition of Beijing Hangyang's sales and marketing expenses Distribution Costs (RMB millions) | Metric | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Distribution Costs | 4.26 | 2.06 | +106.6% | - The increase was primarily due to new marketing activities, promotional activities, and the full recognition of Beijing Hangyang's sales and marketing expenses[60] Administrative Expenses Administrative expenses were approximately RMB 14.52 million, an increase of approximately 19.7% from the prior period, mainly due to the full recognition of Beijing Hangyang's administrative expenses, commensurate with revenue growth Administrative Expenses (RMB millions) | Metric | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Administrative Expenses | 14.52 | 12.13 | +19.7% | - The increase was primarily due to the full recognition of Beijing Hangyang's administrative expenses, commensurate with the percentage increase in revenue[61] Gross Profit and Gross Margin Gross profit was approximately RMB 6.81 million, with a gross margin of 14.4%, a decrease from 18.6% in the prior period, primarily attributable to the continuous decline in gross margin for self-owned and self-produced pharmaceutical products Gross Profit and Gross Margin (RMB millions) | Metric | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Gross Profit | 6.81 | 6.82 | -0.1% | | Gross Margin | 14.4% | 18.6% | -4.2 percentage points | - The decrease in gross margin was primarily attributable to the continuous decline in gross margin for self-owned and self-produced pharmaceutical products[62] Finance Costs Finance costs were approximately RMB 1.27 million, an increase from RMB 1.08 million in the prior period, primarily presented as interest expenses attributable to interest-bearing borrowings Finance Costs (RMB millions) | Metric | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Finance Costs | 1.27 | 1.08 | +17.6% | - Finance costs primarily represent interest expenses attributable to interest-bearing borrowings[63] Loss for the Period The loss attributable to owners of the Company was approximately RMB 10.86 million, compared to a profit of approximately RMB 9.97 million in the prior period, mainly due to a reduction in the significant one-off net gain from subsidiary disposals in the prior period, and increased distribution and administrative expenses attributable to Beijing Hangyang (Loss) Profit for the Period Attributable to Owners of the Company (RMB millions) | Metric | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | (Loss) Profit for the Period Attributable to Owners of the Company | (10.86) | 9.97 | -208.9% | - The change was primarily due to a significant one-off net gain of approximately RMB 17.04 million from the disposal of subsidiaries recorded in the prior period of 2024[64] - Distribution and administrative expenses attributable to Beijing Hangyang collectively increased by approximately RMB 4.6 million[64] Basic and Diluted Loss Per Share For the six months ended June 30, 2025, both basic and diluted loss per share were approximately RMB 7.10 cents, compared to basic and diluted earnings per share of approximately RMB 7.24 cents in the prior period Basic and Diluted (Loss) Earnings Per Share (RMB cents) | Metric | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | | :--- | :--- | :--- | | Basic (Loss) Earnings Per Share | (7.10) | 7.24 | | Diluted (Loss) Earnings Per Share | (7.10) | 7.24 | Liquidity and Financial Resources The Group's cash and cash equivalents slightly increased, but the gearing ratio significantly rose, indicating increased financial leverage, with most transactions conducted in RMB, posing minimal exchange rate fluctuation risk Cash and Cash Equivalents As of June 30, 2025, the Group's cash and cash equivalents were approximately RMB 351.24 million, a slight increase from December 31, 2024, primarily denominated in RMB and HKD Cash and Cash Equivalents (RMB millions) | Metric | As of June 30, 2025 | As of December 31, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Cash and Cash Equivalents | 351.24 | 340.43 | +3.2% | Capital Structure and Gearing Ratio As of June 30, 2025, equity attributable to owners of the Company was approximately RMB 306.02 million, with a gearing ratio of approximately 42.82%, a significant increase from 32.97% on December 31, 2024, reflecting higher debt levels Capital Structure and Gearing Ratio | Metric | As of June 30, 2025 | As of December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Equity Attributable to Owners of the Company (RMB millions) | 306.02 | 321.99 | -5.0% | | Gearing Ratio | 42.82% | 32.97% | +9.85 percentage points | Foreign Exchange Fluctuation Risk Most of the Group's business transactions are conducted in RMB, with no significant foreign exchange fluctuation difficulties encountered during the period, no material interest rate or exchange rate risks, and no hedging financial derivatives held - Most of the Group's business transactions are conducted in RMB, and no significant foreign exchange fluctuation difficulties were encountered[69] - There were no material interest rate or exchange rate risks during the period, nor were any hedging financial derivatives held[69] Other Significant Matters This section covers no significant acquisitions or disposals, changes in employee numbers and remuneration, no material capital expenditures or contingent liabilities, dividend policy, share option scheme adjustments, progress of significant litigation, director changes, and corporate governance compliance during the period Significant Acquisitions and Disposals of Investments During the period, the Group did not undertake any significant acquisitions or disposals of investments - No significant acquisitions or disposals of investments were undertaken during the period[70] Employees and Remuneration As of June 30, 2025, the Group employed approximately 147 employees, a decrease from the prior period, but total staff costs were approximately RMB 6.22 million, an increase from the prior period Employees and Remuneration | Metric | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | Change | | :--- | :--- | :--- | :--- | | Number of Employees | 147 | 156 | -9 | | Total Staff Costs (RMB millions) | 6.22 | 4.84 | +28.5% | Capital Expenditure For the six months ended June 30, 2025, the Group incurred no significant capital expenditure on property, plant and equipment - No significant capital expenditure on property, plant and equipment was incurred during the period[72] Pledge of the Group's Assets As of June 30, 2025, no other assets of the Group were pledged as collateral for borrowings, except for those disclosed in Note 13 for interest-bearing borrowings - No other assets were pledged as collateral, except as disclosed in Note 13[73] Contingent Liabilities As of June 30, 2025, the Group had no significant contingent liabilities - The Group had no significant contingent liabilities[74] Future Plans for Material Investments, Acquisitions and Capital Assets Other than those disclosed in this announcement, the Group had no other plans for material investments, acquisitions, and capital assets during the period - No other plans for material investments, acquisitions, and capital assets were in place during the period[75] Dividends The Board does not recommend the payment of any interim dividend for the six months ended June 30, 2025 - The Board does not recommend the payment of an interim dividend[76] Share Option Scheme The Company has a new share option scheme aimed at incentivizing employees, with the number of share options and exercise price adjusted on August 13, 2024, due to a share consolidation, and no new share options granted during the period - The new share option scheme was adopted on June 16, 2017, with a ten-year validity, aiming to attract, retain, and incentivize employees[77] - Due to the share consolidation, the number of share options was adjusted from 132,722,250 to 5,308,890, and the exercise price from HK$0.084 to HK$2.10[79][80] - No share options were granted during the period[79] Litigation The Company is involved in a significant civil litigation related to a finance lease agreement with Fujian Sanai Pharmaceutical, where the plaintiff seeks joint liability from the Company; after an appeal, the case was remanded for retrial, and the Beijing Fourth Intermediate People's Court issued a second civil judgment confirming Fujian Sanai Pharmaceutical's payment obligations and the Company's joint liability, for which the Company has filed a second appeal, currently ongoing - The Company is involved in a significant civil litigation related to a finance lease agreement with Fujian Sanai Pharmaceutical, being required to bear joint liability for the litigation amount[81][84] - After an appeal, the case was remanded for retrial, and the second civil judgment confirmed Fujian Sanai Pharmaceutical's outstanding payments to the plaintiff and the Company's joint liability[83][84] - The Company has filed a second appeal with the Beijing High People's Court regarding the second civil judgment, requesting a ruling that the finance lease agreement and guarantee are invalid[85] Purchase, Sale or Redemption of the Company's Listed Securities During the period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities - No purchase, sale, or redemption of the Company's listed securities occurred during the period[87] Events After the Reporting Period No significant events have occurred from the end of the reporting period up to the date of this announcement - No significant events occurred after the end of the reporting period[88] Changes in Directors' Information After the period, Mr Chan Shing Hing retired as an executive director, and Professor Zhang Rongqing resigned as an executive director - Mr Chan Shing Hing retired as an executive director on June 20, 2025[90] - Professor Zhang Rongqing resigned as an executive director on June 26, 2025[90] Compliance with Corporate Governance Code The Company has complied with the Corporate Governance Code, with a deviation where the roles of Chairman and Chief Executive Officer are not segregated (no Chairman), but the Board believes sufficient checks and balances are in place - The Company has complied with the Corporate Governance Code, with a deviation where the roles of Chairman and Chief Executive Officer are not segregated (no Chairman)[91] - The Board believes that with three independent non-executive directors, sufficient checks and balances are in place[91] Compliance with Model Code All Directors have confirmed full compliance with the Model Code as set out in Appendix C3 of the Listing Rules during the period - All Directors have confirmed full compliance with the Model Code[92] Capital Reduction and Share Subdivision The Company has completed a capital reduction and share subdivision, reducing the par value per share from HK$0.25 to HK$0.01 and subdividing authorized but unissued shares, with these changes effective February 3, 2025 - The capital reduction and share subdivision became effective on February 3, 2025[94] - The par value per share was reduced from HK$0.25 to HK$0.01[93] Audit Committee The Audit Committee, comprising three independent non-executive directors, reviewed the Group's financial reporting procedures, risk management, and internal control systems, and discussed the interim financial statements, deeming them compliant with relevant accounting standards - The Audit Committee comprises three independent non-executive directors, with Mr Hui Ki Lun as Chairman[95] - The Committee reviewed the interim financial statements and considered them to be in compliance with relevant accounting standards, rules, and regulations[95] Publication of Interim Report The 2025 Interim Report will be dispatched to shareholders in due course and published on the Company's website and the Stock Exchange's website - The 2025 Interim Report will be dispatched to shareholders in due course and published on the Company's and the Stock Exchange's websites[96] Acknowledgement The Group sincerely thanks the management team, all employees, shareholders, and other stakeholders for their continuous efforts, dedication, strong support, and trust - The Group expresses gratitude to the management team, employees, shareholders, and stakeholders for their support[97] Board of Directors As of the announcement date, the Board of Directors comprises three executive directors (Mr Yuan Chaoyang, Mr She Hao, Mr Xie Haijing) and three independent non-executive directors (Professor Zhu Yizhun, Mr Hui Ki Lun, Ms Xu Wanda) - The Board of Directors consists of three executive directors and three independent non-executive directors[99]