中国文旅农业(00542) - 2025 - 中期业绩

2025 Interim Results Announcement Condensed Consolidated Statement of Profit or Loss The Group achieved significant revenue growth and a substantial reduction in loss in the first half of 2025, primarily due to improvements in the property development business, despite finance costs remaining a major expense Condensed Consolidated Statement of Profit or Loss | Metric | H1 2025 (HKD thousands) | H1 2024 (HKD thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 35,626 | 13,489 | 164.1% | | Cost of sales | (25,543) | (7,702) | 231.6% | | Gross profit | 10,083 | 5,787 | 74.2% | | Other income and gains | 547 | 1,060 | -48.4% | | Selling expenses | (381) | (1,411) | -73.0% | | Administrative and other expenses | (3,644) | (46,455) | -92.2% | | Finance costs | (53,563) | (52,715) | 1.6% | | Loss before tax | (46,958) | (93,734) | -49.9% | | Income tax (expense)/credit | (1,069) | 224 | -576.3% | | Loss for the period | (48,027) | (93,510) | -48.7% | | Loss for the period attributable to owners of the Company | (52,492) | (88,185) | -40.5% | | Non-controlling interests | 4,465 | (5,325) | 183.8% | | Basic loss per share (HK cents) | (0.68) | (1.15) | -40.9% | - Loss for the period significantly narrowed by 48.7%, decreasing from HKD 93,510 thousands in H1 2024 to HKD 48,027 thousands in H1 2025[4] - Basic loss per share improved from 1.15 HK cents in H1 2024 to 0.68 HK cents in H1 2025[4] Condensed Consolidated Statement of Comprehensive Income The Group's total comprehensive loss for H1 2025 narrowed compared to the prior year, primarily due to a reduced loss for the period, although exchange differences on translating foreign operations shifted from a gain to a loss Condensed Consolidated Statement of Comprehensive Income | Metric | H1 2025 (HKD thousands) | H1 2024 (HKD thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Loss for the period | (48,027) | (93,510) | -48.7% | | Exchange differences on translating foreign operations | (309) | 8,488 | -103.6% | | Total comprehensive loss for the period | (48,336) | (85,022) | -43.1% | | Total comprehensive loss for the period attributable to owners of the Company | (55,289) | (79,731) | -30.7% | | Non-controlling interests | 6,953 | (5,291) | 231.4% | - Total comprehensive loss for the period decreased from HKD 85,022 thousands in H1 2024 to HKD 48,336 thousands in H1 2025, narrowing by 43.1%[5] - Exchange differences on translating foreign operations shifted from a HKD 8,488 thousands gain in H1 2024 to a HKD 309 thousands loss in H1 2025[5] Condensed Consolidated Statement of Financial Position As of June 30, 2025, the Group's total assets slightly increased, but total current liabilities remained high, leading to a further expansion of net current liabilities and an increase in total equity deficit to HKD 66,424 thousands, posing significant uncertainty to its going concern ability Condensed Consolidated Statement of Financial Position | Metric | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Total non-current assets | 1,772,752 | 1,741,641 | 1.8% | | Total current assets | 1,306,729 | 1,337,198 | -2.3% | | Total assets | 3,079,481 | 3,078,839 | 0.02% | | Total current liabilities | 1,819,089 | 1,755,322 | 3.6% | | Net current liabilities | (512,360) | (418,124) | 22.5% | | Total non-current liabilities | 1,326,816 | 1,341,605 | -1.1% | | Net liabilities | (66,424) | (18,088) | 267.2% | | Deficit attributable to owners of the Company | (201,235) | (145,946) | 37.9% | | Non-controlling interests | 134,811 | 127,858 | 5.4% | | Total deficit | (66,424) | (18,088) | 267.2% | - Net current liabilities expanded from HKD 418,124 thousands as of December 31, 2024, to HKD 512,360 thousands as of June 30, 2025, indicating increased liquidity pressure[7] - The Group's total equity deficit further expanded from HKD 18,088 thousands as of December 31, 2024, to HKD 66,424 thousands as of June 30, 2025[7] Notes to the Condensed Consolidated Financial Statements This section details the Group's accounting policies, operating segments, revenue composition, finance costs, taxation, asset and liability breakdowns, and commitments, revealing ongoing going concern challenges and measures taken to improve liquidity Basis of Preparation and Going Concern The Group faces severe liquidity challenges, recording a net loss as of June 30, 2025, with substantial financial obligations due within the next 12 months, while cash and cash equivalents are insufficient for repayment; directors have formulated plans to improve liquidity, but significant uncertainties regarding its going concern ability persist - As of June 30, 2025, the Group recorded a net loss of approximately HKD 48,027,000[12] - Approximately HKD 1,819,089,000 of the Group's financial obligations are due within the next 12 months, including bank borrowings of approximately HKD 170,345,000 and other borrowings of HKD 64,217,000 repayable on demand, while available cash and cash equivalents are only approximately HKD 16,536,000[12] - Directors have implemented various plans and measures to improve liquidity and financial position, including accelerating property pre-sales and sales, optimizing the workforce, negotiating renewals and extensions with lenders, and exploring asset disposal opportunities[13] Operating Segment Information The Group primarily operates in property development, hotel business, and other businesses (retail sales); the property development segment achieved significant profitability in H1 2025, while hotel business losses narrowed, indicating property development as the main driver of improved performance Operating Segment Performance | Segment | H1 2025 Revenue (HKD thousands) | H1 2024 Revenue (HKD thousands) | H1 2025 Profit/(Loss) (HKD thousands) | H1 2024 Profit/(Loss) (HKD thousands) | | :--- | :--- | :--- | :--- | :--- | | Property development | 35,027 | 11,930 | 18,269 | (24,564) | | Hotel business | 308 | 309 | (8,231) | (11,560) | | Others | 291 | 1,250 | (143) | (2,845) | | Total | 35,626 | 13,489 | 9,895 | (38,969) | - Property development segment revenue increased by 193.6% year-on-year and shifted from a loss to a profit, being the primary contributor to the Group's overall performance improvement[18] - Hotel business revenue remained stable, with segment loss narrowing by 28.8%[18] Revenue and Other Income The Group's revenue primarily derived from sales of properties held for sale, which significantly increased in H1 2025, while other income and gains decreased, mainly due to reduced rental income Revenue by Source | Revenue Source | H1 2025 (HKD thousands) | H1 2024 (HKD thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Sales of properties held for sale | 29,956 | 10,507 | 185.1% | | Sales of goods | 291 | 1,250 | -76.7% | | Licensing income | 308 | 309 | -0.3% | | Property agency income | 5,071 | 1,423 | 256.4% | | Total Revenue | 35,626 | 13,489 | 164.1% | Other Income and Gains | Other Income and Gains | H1 2025 (HKD thousands) | H1 2024 (HKD thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Bank interest income | 89 | 131 | -32.1% | | Rental income | – | 354 | -100.0% | | Others | 458 | 575 | -20.3% | | Total | 547 | 1,060 | -48.4% | - Sales of properties held for sale revenue was the primary driver of the Group's revenue, growing by 185.1% year-on-year[25] Finance Costs The Group's finance costs primarily stemmed from interest on loans and borrowings, and despite some borrowing costs being capitalized, overall finance costs remained at a high level Finance Costs Breakdown | Item | H1 2025 (HKD thousands) | H1 2024 (HKD thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Interest on loans and borrowings | 41,073 | 44,083 | -6.9% | | Interest on amount due to a director | 8,143 | 9,013 | -9.6% | | Interest on acceptance bills payable | 6,252 | 1,915 | 226.5% | | Interest on lease liabilities | – | 40 | -100.0% | | Total | 55,508 | 55,011 | 0.9% | | Less: Amount capitalized in properties under development | (1,945) | (2,296) | -15.3% | | Net finance costs | 53,563 | 52,715 | 1.6% | - Borrowing costs were capitalized at annual interest rates ranging from 6.5% to 8.1% (H1 2024: 6.5% to 8.5%)[28] Loss Per Share The Group's basic loss per share improved compared to the prior year, but diluted loss per share was not presented due to the absence of potential ordinary shares outstanding during the period - Basic loss per share is calculated based on the loss for the period attributable to owners of the Company of HKD 52,492,000 (H1 2024: HKD 88,185,000) and 7,687,158,040 ordinary shares outstanding[32] - Diluted loss per share was not presented as there were no potential ordinary shares outstanding during the period[32] Assets and Liabilities The Group's properties under development and properties held for sale are major assets, with an increase in impairment losses on trade receivables; current liabilities saw significant increases in trade payables and interest payables, while total loans and borrowings decreased, yet substantial short-term repayment pressure persists Asset and Liability Overview | Asset and Liability Item | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Properties under development | 1,606,952 | 1,567,804 | 2.5% | | Properties held for sale | 836,225 | 843,756 | -0.9% | | Trade receivables (net) | 2,576 | 1,911 | 34.8% | | Trade payables, other payables and accrued expenses | 658,228 | 641,586 | 2.6% | | Contract liabilities | 96,889 | 34,634 | 179.7% | | Total loans and borrowings | 1,409,114 | 1,514,248 | -6.9% | | Amount due to a director | 155,006 | 153,121 | 1.2% | | Acceptance bills payable | 139,102 | 136,815 | 1.7% | - Impairment losses on trade receivables increased from HKD 81,603 thousands as of December 31, 2024, to HKD 84,232 thousands as of June 30, 2025[37] - Interest payables significantly increased from HKD 88,128 thousands as of December 31, 2024, to HKD 152,714 thousands as of June 30, 2025, a 73.3% increase[38] Commitments and Contingent Liabilities The Group's project commitments significantly increased, while contingent liabilities substantially decreased, primarily related to repurchase guarantees provided to banks - Project commitments (contracted but unprovided property development expenditures and land acquisitions) increased from HKD 273,600 thousands as of December 31, 2024, to HKD 359,000 thousands as of June 30, 2025[56] - Total contingent liabilities significantly decreased from HKD 280,600 thousands as of December 31, 2024, to HKD 145,700 thousands as of June 30, 2025, primarily related to repurchase guarantees provided to banks[58] - The Group had no significant capital commitments at the end of both reporting periods[57] Management Discussion and Analysis Management reviewed the Group's operating results for H1 2025, highlighting significant improvements in the property development business as the main reason for narrowed losses, while also detailing the Group's financial position, liquidity challenges, outlook on the Chinese real estate market, and proposed strategies Business Review The Group's revenue significantly increased in H1 2025, with both loss before tax and loss attributable to owners of the Company substantially narrowing, primarily due to improvements in the property development business, despite finance costs remaining a major expense - The Group's revenue was approximately HKD 35,600,000, a significant increase from HKD 13,500,000 in the same period of 2024[60] - Loss before tax was approximately HKD 47,000,000, narrowing from HKD 93,700,000 in the same period of 2024[60] - Loss attributable to owners of the Company was approximately HKD 52,500,000, an improvement from HKD 88,200,000 in the same period of 2024[60] Segment Performance The property development segment achieved a significant turnaround from loss to profit in H1 2025, primarily driven by pre-sales progress of projects like De De Guo Cheng, Fu Yuan Jun Ting, and Fu Yuan Plaza; hotel business losses narrowed, but revenue remained flat - Property development segment revenue was approximately HKD 35,000,000, a significant increase from HKD 11,900,000 in the same period of 2024[61] - The property development segment turned from a loss of HKD 24,600,000 in the same period of 2024 to a profit of HKD 18,300,000 in H1 2025[61] - The De De Guo Cheng project achieved 65.0% of its total saleable area in sales contracts, with construction expected to be completed in October 2025[62] - Phases I and II of the Fu Yuan Jun Ting project achieved sales contracts of approximately 100% and 88.1% respectively[63] - The hotel business segment recorded HKD 300,000 in sub-licensing income, flat year-on-year, with segment loss narrowing to HKD 8,200,000[66] Capital Structure, Liquidity and Financial Resources The Group's total interest-bearing borrowings decreased, but the total equity deficit significantly expanded, and the gearing ratio substantially increased due to reduced borrowings and equity, indicating severe liquidity pressure Capital Structure and Liquidity | Metric | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Total interest-bearing borrowings | 1,703,200 | 1,804,100 | -5.6% | | Borrowings from financial institutions | 490,900 | 537,300 | -8.7% | | Borrowings from independent third parties | 854,000 | 912,700 | -6.5% | | Acceptance bills payable | 139,100 | 136,800 | 1.7% | | Other loans | 64,200 | 64,200 | 0.0% | | Amount due to a director | 155,000 | 153,100 | 1.2% | | Total equity (deficit) | (66,400) | (18,100) | 267.4% | - The Group's total equity deficit expanded from HKD 18,100,000 as of December 31, 2024, to HKD 66,400,000 as of June 30, 2025[70] - The gearing ratio significantly increased, primarily due to substantial interest-bearing borrowings for property development operations and a reduction in the Group's total equity during the period[70] Pledge of the Group's Assets Portions of the Group's leasehold land and buildings, along with restricted bank balances, have been pledged to financial institutions as collateral for loans and financing - Leasehold land and buildings with a carrying value of approximately HKD 164,700,000 (December 31, 2024: HKD 173,200,000) have been pledged to financial institutions[74] - Restricted bank balances of approximately HKD 1,000,000 (December 31, 2024: HKD 100,800,000) have been pledged to certain banks[74] Staff Analysis The Group's total number of employees decreased, and it will continue to implement human resource training and development programs - As of June 30, 2025, the Group employed a total of 70 staff, a decrease from 90 as of December 31, 2024[75] - The Group will continue to implement its overall human resource training and development programs to enhance employee knowledge, skills, and experience[75] Prospects and Plans The Chinese real estate market faced severe pressure in H1 2025, with a gradual narrowing of year-on-year decline expected in H2, though the market remains sluggish; the Group will benefit from policy support, but market confidence recovery will take time - In H1 2025, China's overall economy faced severe pressure on property sales due to adverse factors such as weak domestic demand, a sluggish labor market, a stagnant real estate market, and low consumer sentiment[76] - The year-on-year decline in national new home sales is expected to gradually narrow in H2, but real estate investment may remain weak, and the market is still in a downturn[76] - Key policy directions include lowering mortgage interest rates, reducing transaction taxes and fees, and optimizing home purchase restrictions to stimulate demand for upgraded housing and drive market recovery[76] Corporate Governance The Group is committed to maintaining high standards of corporate governance and largely complies with the Corporate Governance Code in Appendix C1 of the Listing Rules, though the combined roles of Chairman and Chief Executive Officer constitute a deviation - The Company has applied and complied with the principles and applicable code provisions of the Corporate Governance Code set out in Appendix C1 of the Listing Rules, except for the combined roles of Chairman and Chief Executive Officer held by Mr. Yang Lijun, which constitutes a deviation[77][78] - Mr. Zeng Haobang was appointed as an independent non-executive director, chairman of the Nomination Committee, member of the Audit Committee, and member of the Remuneration Committee, effective June 4, 2025[79] - All directors confirmed compliance with the Model Code for Securities Transactions by Directors throughout the six months ended June 30, 2025[80] Audit Committee and Review of Interim Results The Company's Audit Committee has reviewed the Group's unaudited condensed consolidated financial information for the six months ended June 30, 2025 - The Audit Committee comprises three independent non-executive directors[82] - The Audit Committee, the Company's auditor, and the Company's management have reviewed the Group's unaudited condensed consolidated financial information for the six months ended June 30, 2025[82] Cautionary Statement The financial information contained in this announcement is unaudited and has not been agreed upon by the auditor; shareholders and potential investors are urged to exercise caution when dealing in the Company's securities - The financial information regarding the Group's interim results contained in this announcement is unaudited and has not been agreed upon by the auditor[84] - Shareholders and potential investors of the Company are urged to exercise caution when dealing in the Company's securities[84]