康圣环球(09960) - 2025 - 中期业绩

Company Overview Company Information Kindstar Globalgene Technology, Inc. was incorporated in the Cayman Islands on August 24, 2007, with shares listed on the Hong Kong Stock Exchange since July 16, 2021; the Group primarily provides clinical testing services in China - The company was incorporated in the Cayman Islands on August 24, 2007, and its shares were listed on the Hong Kong Stock Exchange on July 16, 2021[2] - The Group primarily engages in providing clinical testing services in China[71] Financial Highlights For the six months ended June 30, 2025, total revenue decreased by 3.5% to RMB 456.9 million, gross profit fell 13.0% to RMB 196.5 million, and net profit turned to a loss of RMB 32.6 million Table: Financial Highlights | Metric | 2025 (RMB thousands) | 2024 (RMB thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 456,919 | 473,335 | (3.5) | | Gross Profit | 196,530 | 225,790 | (13.0) | | Gross Profit Margin (%) | 43.0 | 47.7 | (4.7) percentage points | | Net (Loss) / Profit | (32,636) | 10,528 | (410.0) | | Net (Loss) / Profit Margin (%) | (7.1) | 2.2 | (9.3) percentage points | Management Discussion and Analysis Executive Summary For the six months ended June 30, 2025, revenue decreased by 3.5%, gross profit by 13.0%, and net profit turned to a loss of RMB 32.6 million, driven by market challenges, pricing pressure, fair value losses, and M&A expenses, while the company advanced in specialized testing, optimized operations, and expanded through strategic acquisitions - Revenue decreased by 3.5% to RMB 456.9 million, gross profit decreased by 13.0% to RMB 196.5 million, and net loss was RMB 32.6 million[4][6][7][8] - The net loss was primarily due to decreased revenue, fair value losses on funds, expected credit losses on COVID-19 related receivables, and expenses and losses from acquired subsidiaries[8] - The company steadily advanced in a complex market, optimizing operational strategies and ensuring comprehensive upgrades in business models and compliance management[9] - Market position in key specialized areas was consolidated through deepened application of multi-technology platforms and expansion of multiple testing projects, with continuous strategic M&A initiatives[9] Financial Performance Overview During the reporting period, total revenue decreased by 3.5% to RMB 456.9 million, gross profit fell 13.0% to RMB 196.5 million, and net profit turned to a loss of RMB 32.6 million, influenced by market conditions, increased costs, fair value changes in funds, and M&A expenses - Revenue decreased by 3.5% to RMB 456.9 million, primarily due to challenging external market conditions and downward pricing pressure on testing services[6] - Gross profit decreased by 13.0% to RMB 196.5 million, with the gross profit margin falling from 47.7% to 43.0%, mainly due to decreased revenue and increased fixed operating costs from new laboratories[7] - Net loss was approximately RMB 32.6 million, a year-on-year decrease of 410%, with a net loss margin of 7.1%, primarily due to decreased revenue, fair value losses on funds, expected credit losses on COVID-19 related receivables, and expenses and losses from acquired subsidiaries[8] Business Development Overview Amidst strengthening industry regulation and growing demand for precision medicine, the company leveraged its specialized testing expertise to optimize operations and upgrade compliance, consolidating its market position through multi-technology platforms and expanded testing projects, while strategic M&A further expanded its business footprint and integrated resources for long-term growth - Leveraging deep expertise in specialized testing, operational strategies were optimized to ensure comprehensive upgrades in business models and compliance management, successfully addressing policy challenges[9] - Market position in key specialized areas was further consolidated through deepened application of multi-technology platforms and expansion of multiple testing projects[9] - Strategic M&A continued to advance, achieving orderly business expansion and promoting efficient resource integration and optimal allocation[9] Business Operations The company steadily advanced in a complex market by optimizing operations, deepening multi-technology platform applications, and expanding testing projects, consolidating its market position in six core specialized testing areas including hematology, neurology, genetic and rare diseases, infectious diseases, solid tumors, and gynecology, while also driving innovation in immunomics products, specialized reagents, research services, and internet hospitals, and expanding its business footprint through strategic M&A - The company established strong barriers in six core specialized testing areas: hematology, neurology, genetic and rare diseases, infectious diseases, solid tumors, and gynecology[10] - Market position in key specialized areas was consolidated through deepened application of multi-technology platforms and expansion of multiple testing projects[9] - Strategic M&A continued to advance, achieving business expansion and resource integration[9] Specialized Testing Services During the reporting period, the company developed in hematology, neurology, oncology, infectious diseases, maternal and child health, and new specialized testing, with hematology adding over 90 partner hospitals and NGS IG/TCR rearrangement product sales growing over 50%, oncology adding 15 partners with solid tumor large panel and MRD testing growing over 100% and gaining ground in early screening through acquisition, and new specialties like rheumatology and cardiovascular testing steadily rising with new product approvals - Hematology testing: Over 90 new partner hospitals were added, 48 new partner hospitals in pediatric hematology, and NGS IG/TCR rearrangement technology product sales grew over 50%[10] - Neurology testing: 34 new testing items were added, 44 new partner hospitals for sample submission, and early deployment of blood tests for neurodegenerative diseases in pharmaceutical collaborations[10] - Oncology testing: 15 new key cooperative units, including Peking University Cancer Hospital, were added, with solid tumor large panel testing and solid tumor MRD testing growing over 100% year-on-year[11] - Oncology testing: The acquisition of Benchmark Medical was completed in January 2025, quickly establishing a presence in solid tumor early screening and diagnosis, with the flagship product FeiYiJian® PulmoSeek® Plus included in the NMPA LDT pilot program[11] - Infectious disease testing: Self-developed pathogen-targeted high-throughput sequencing product reagents and analysis software were launched, implementing various syndrome-specific pathogen combination products[12] - Maternal and child specialized business: Growth in pediatric endocrine projects was promoted through L-CBA detection of MOG antibody multi-center studies, and a professional reproductive genetics team was established[12] - New specialized testing services: Sales of antiphospholipid series and complement factor projects in the rheumatology and immunology testing segment steadily increased, while cardiovascular testing saw 1 new approved Class I reagent filing for mass spectrometry testing, 1 Class II in vitro diagnostic kit, and 3 clinical mass spectrometry laboratories established[13] Innovation-Driven and R&D During the reporting period, the Group's R&D department published 33 articles, applied for 67 patents (29 granted), and obtained 24 copyrights, adding 56 R&D testing projects across molecular biology, flow cytometry, cytogenetics, and pathology, with a focus on CAR-T monitoring, AML MRD monitoring, fusion gene quantitative detection, and MICM comprehensive diagnosis, planning to integrate AI analysis - 33 articles published, 67 patents applied for (29 granted), and 24 copyrights obtained[14] - 56 new R&D testing projects added, including molecular biology, flow cytometry, cytogenetics, and pathology testing technologies[14] - Focus on developing CAR-T monitoring, Acute Myeloid Leukemia MRD monitoring (detection limit improved to 0.1%), fusion gene quantitative detection (144 genes), and MICM comprehensive diagnosis, with plans to integrate remote scanning and AI analysis[14] Immunomics Products LymphoSeek business expanded to over 160 institutions in 26 provinces for hematological tumor minimal residual disease detection, with revenue growing nearly 30% year-on-year; Kindstar Biotech's Ig/TCR project achieved a perfect score in the EuroClonality EQA program, becoming the only one nationwide, while Kindstar Health deepened health monitoring collaborations, PanTCR focused on immune reconstruction and monitoring, and explored immune therapy efficacy evaluation with pharmaceutical companies - LymphoSeek business covers over 160 institutions in 26 provinces, with revenue growing nearly 30% year-on-year[15] - Kindstar Biotech's Ig/TCR project achieved a perfect score in the EuroClonality EQA program, making it the only one nationwide[15] - Kindstar Health deepened health monitoring collaborations, PanTCR focused on immune reconstruction and monitoring, and explored immune therapy efficacy evaluation with pharmaceutical companies[15] Specialized Reagents Haixi Bio's product line continues to expand with over 180 products developed and transferred to production, increased NGS reagent kit compatibility, and 74 fusion gene screening items at a leading domestic level; specialized reagent business proprietary product sales rose over 20% year-on-year, while Benchmark Medical's UriFind®, the first approved kit for urothelial carcinoma auxiliary diagnosis, saw sales grow approximately 82%, and non-invasive gastric cancer early detection product Gastromia® completed clinical registration studies and entered the registration application phase - Haixi Bio's product line is rich, with over 180 products developed and transferred to production, increased NGS reagent kit compatibility with sequencing platforms, and 74 fusion gene screening items at a leading domestic level[16] - Sales of proprietary products in the specialized reagent business increased by over 20% year-on-year[16] - UriFind® sales volume increased by approximately 82% year-on-year, having completed procurement processes with 11 hospitals and 8 third-party clients[17] - Non-invasive gastric cancer early detection product Gastromia® (WeiYiJian) has completed in vitro diagnostic reagent registration clinical studies and entered the product registration application phase, with breakthroughs expected in the first quarter of next year[17] Research Services and Contract Research Organization The Group, as an official PacBio certified Revio platform sequencing service provider, operates three PacBio Revio systems and has fully upgraded to the latest SPRQ reagents to enhance sequencing throughput; the research services segment added nearly 100 new partner hospitals and enterprises in the first half, with total revenue approaching RMB 20 million, while CRO business secured new contracts worth approximately RMB 9.78 million, with a contract backlog exceeding RMB 37 million - As an official PacBio certified Revio platform sequencing service provider, the company operates 3 PacBio Revio systems and has fully upgraded SPRQ reagents to enhance sequencing throughput[18] - The research services segment added nearly 100 new partner hospitals and enterprises in the first half, achieving total revenue of nearly RMB 20 million[18] - CRO business secured new contracts worth approximately RMB 9.78 million, with a contract backlog exceeding RMB 37 million[19] Internet Hospital "Kindstar Youyi" internet hospital's physician platform has nearly 500 collaborating doctors across over 10 departments, with 27% holding associate senior titles or above; registered users and monthly active users grew significantly, improving service satisfaction, and in the first half of 2025, Kindstar Youyi officially integrated with the DeepSeek AI platform, deeply embedding AI capabilities into its service system to reshape the patient experience - "Kindstar Youyi" internet hospital's physician platform has nearly 500 collaborating doctors, covering over 10 departments, with 27% holding associate senior titles or above[20] - Registered users and monthly active users on the platform grew significantly, leading to improved service satisfaction[20] - Officially integrated with the DeepSeek AI platform, deeply embedding AI capabilities into the internet hospital service system to reshape the patient experience[20] Strategic Development The company accelerated investment in integrating upstream and downstream industry chain resources, focusing on critical specialized testing areas with urgent clinical needs; strategic investment in Wuhan Tuoruijing strengthened its advanced molecular diagnostic technology layout, and a joint venture with Biostate AI, Wuhan Baisheng Intelligent, will bring AI-driven RNA multi-omics diagnostic technology to China and globally, focusing on five specialized areas including autoimmune diseases and oral cancer; the company actively promotes digital, information, and AI transformation, upgrading its smart order management platform and LIMS system to enhance operational efficiency, and plans to continue deploying multi-omics data integration platforms, AI pathology analysis systems, and automated laboratory technologies to achieve a "introduce-digest-innovate" technology upgrade path - Accelerated investment in integrating upstream and downstream industry chain resources, focusing on critical specialized testing areas with urgent clinical needs[21] - Actively promoted a tripartite transformation strategy of digitalization, informatization, and artificial intelligence, upgrading the smart order management platform and LIMS system to enhance operational efficiency[24] - Future plans include continuous deployment of multi-omics data integration platforms, AI pathology analysis systems, and automated laboratory technologies to achieve a "introduce-digest-innovate" technology upgrade path[23] External Investments and M&A In the first half of 2025, the company completed an angel round investment in Wuhan Tuoruijing to strengthen its advanced molecular diagnostic platform's technology layout and clinical translation capabilities; concurrently, it co-founded Wuhan Baisheng Intelligent with Biostate AI from the US, introducing AI-driven RNA multi-omics diagnostic technology to focus on five specialized areas—autoimmune diseases, oral cancer, diabetes, lymphoma, and organ transplantation—aiming to build a globally leading intelligent molecular diagnostic platform - Completed an angel round investment in Wuhan Tuoruijing, strengthening the technology layout and clinical translation capabilities of its advanced molecular diagnostic platform[21] - Co-founded Wuhan Baisheng Intelligent with Biostate AI from the US, introducing AI-driven RNA multi-omics diagnostic technology, focusing on five specialized areas to build a globally leading intelligent molecular diagnostic platform[22] Digitalization, Informatization, and AI The Group actively promoted a tripartite transformation strategy of digitalization, informatization, and artificial intelligence, upgrading its smart order management platform to optimize logistics and enable full-process tracking, significantly reducing erroneous sample submission rates; laboratory digitalization progressed significantly through full-process digital management and LIMS system upgrades, notably reducing report turnaround times and enhancing operational efficiency - Upgraded the smart order management platform, optimized logistics processes, achieved full-process tracking from unboxing to pre-processing, significantly reducing erroneous sample submission rates[24] - Laboratory digitalization progressed significantly through full-process digital management and LIMS system upgrades, reducing report turnaround times and enhancing operational efficiency[24] Future Outlook Looking ahead to 2025, the Group will continue to deepen its core testing technologies to ensure stability, actively expand upstream and downstream industrial chains to create new business growth points, and plans to continuously deploy multi-omics data integration platforms, AI pathology analysis systems, and automated laboratory technologies, achieving a "introduce-digest-innovate" technology upgrade path through investment in international cutting-edge testing technologies and promoting localized validation and industrialization, addressing market competition with a dual-track IVD+LDT collaborative development - Continue to deepen core testing technologies, ensure stable fundamentals, and actively expand upstream and downstream industrial chains to create new business growth points[24] - Continuously deploy multi-omics data integration platforms, AI pathology analysis systems, and automated laboratory technologies to achieve a "introduce-digest-innovate" technology upgrade path[23] - With a dual-track IVD+LDT collaborative development, the company is confident in achieving a "balanced offense and defense" and leading innovative development in medical testing[24] Detailed Financial Review For the six months ended June 30, 2025, the company recorded a pre-tax loss of RMB 30.680 million, compared to a profit of RMB 15.069 million in the prior period; revenue decreased by 3.5%, and cost of sales increased by 5.2%, leading to a 13.0% decline in gross profit, while administrative expenses, other expenses, and finance costs all saw significant increases, collectively resulting in a net loss of RMB 32.636 million for the period Table: Detailed Financial Review | Metric | 2025 (RMB thousands) | 2024 (RMB thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 456,919 | 473,335 | (3.5) | | Cost of Sales | (260,389) | (247,545) | 5.2 | | Gross Profit | 196,530 | 225,790 | (13.0) | | Other Income and Gains | 48,865 | 54,889 | (11.0) | | Selling and Marketing Expenses | (144,991) | (147,923) | (2.0) | | Administrative Expenses | (56,249) | (46,767) | 20.3 | | Research and Development Costs | (46,046) | (48,401) | (4.9) | | Other Expenses | (21,090) | (17,840) | 18.2 | | Finance Costs | (7,699) | (4,679) | 64.5 | | (Loss) / Profit Before Tax | (30,680) | 15,069 | (303.6) | | Income Tax Expense | (1,956) | (4,541) | (56.9) | | (Loss) / Profit for the Period | (32,636) | 10,528 | (410.0) | - Revenue decreased by 3.5%, cost of sales increased by 5.2%, and gross profit decreased by 13.0%[26] - Administrative expenses increased by 20.3%, other expenses by 18.2%, and finance costs by 64.5%[26] - Pre-tax profit turned from a profit of RMB 15.069 million to a loss of RMB 30.680 million, with a net loss of RMB 32.636 million for the period[26] Consolidated Income Statement Analysis During the reporting period, revenue decreased by 3.5% and cost of sales increased by 5.2%, resulting in a 13.0% decline in gross profit; administrative expenses, other expenses, and finance costs significantly increased, while R&D costs and selling and marketing expenses slightly decreased, collectively leading to a pre-tax loss of RMB 30.680 million, compared to a pre-tax profit in the prior period, and a net loss of RMB 32.636 million for the period Revenue For the six months ended June 30, 2025, total revenue was RMB 456.919 million, a 3.5% year-on-year decrease; all testing business lines, except oncology testing due to the merger with Benchmark Medical, experienced revenue decline due to external market challenges and hospital cost control pressures, while research services and CRO revenue grew approximately 50.6% year-on-year to RMB 32 million - Total revenue was RMB 456.919 million, a year-on-year decrease of 3.5%[26] Table: Revenue by Operating Segment | Operating Segment | 2025 (RMB thousands) | Share (%) | 2024 (RMB thousands) | Share (%) | | :--- | :--- | :--- | :--- | :--- | | Hematology Testing | 276,691 | 60.6 | 297,919 | 62.9 | | Neurology Testing | 47,074 | 10.3 | 49,154 | 10.4 | | Gynecology-related Testing | 20,942 | 4.6 | 25,003 | 5.3 | | Genetic and Rare Disease Testing | 20,664 | 4.5 | 23,635 | 5.0 | | Infectious Disease Testing | 17,946 | 3.9 | 23,659 | 5.0 | | Oncology Testing | 18,464 | 4.0 | 10,972 | 2.3 | | Routine Testing | 20,393 | 4.5 | 21,064 | 4.5 | | Research Services and CRO | 32,059 | 7.0 | 21,285 | 4.5 | - All testing business lines, except oncology testing due to increased revenue from the merger with Benchmark Medical, experienced revenue decline[31] - Research services and CRO revenue was approximately RMB 32 million, a year-on-year increase of approximately 50.6%[32] Cost of Sales For the six months ended June 30, 2025, cost of sales increased by 5.2% to approximately RMB 260.4 million, primarily due to lower sales discounts, changes in product mix, and increased fixed operating costs from new laboratories - Cost of sales increased by 5.2% to approximately RMB 260.4 million[34] Table: Cost of Sales Details | Cost of Sales Details | 2025 (RMB thousands) | Share (%) | 2024 (RMB thousands) | Share (%) | | :--- | :--- | :--- | :--- | :--- | | Staff Costs | 73,454 | 28.2 | 73,583 | 29.7 | | Outsourcing Costs | 43,664 | 16.8 | 42,052 | 17.0 | | Raw Materials | 81,429 | 31.3 | 78,117 | 31.6 | | Others | 61,842 | 23.7 | 53,793 | 21.7 | | Total | 260,389 | 100.0 | 247,545 | 100.0 | - The increase in costs was primarily due to lower sales discounts, changes in product mix, and increased fixed operating costs from new laboratories[34] Gross Profit and Segment Results For the six months ended June 30, 2025, consolidated gross profit decreased by 13.0% to RMB 196.5 million, with the gross profit margin falling to 43.0%, primarily due to decreased revenue and increased fixed costs from new laboratories; most testing segments saw declining performance due to market conditions and hospital cost control pressures, with oncology testing incurring a loss of RMB 13.6 million due to the acquisition of Benchmark Medical, and CRO and research services segment loss expanding to RMB 6.0 million - Consolidated gross profit decreased by 13.0% to RMB 196.5 million, with the gross profit margin falling by 4.7 percentage points from 47.7% to 43.0%[35] - The decrease in gross profit and gross profit margin was primarily due to a RMB 16.4 million decline in revenue and increased fixed operating costs from new laboratories[35] Table: Segment Results | Operating Segment | 2025 Segment Results (RMB thousands) | % of Segment Revenue | 2024 Segment Results (RMB thousands) | % of Segment Revenue | | :--- | :--- | :--- | :--- | :--- | | Hematology Testing | 61,755 | 22.3 | 67,898 | 22.8 | | Neurology Testing | 9,519 | 20.2 | 7,316 | 14.9 | | Gynecology-related Testing | 206 | 1.0 | 727 | 2.9 | | Genetic and Rare Disease Testing | 592 | 2.9 | 3,045 | 12.9 | | Infectious Disease Testing | 40 | 0.2 | 2,835 | 12.0 | | Oncology Testing | (13,638) | (73.9) | 1,702 | 15.5 | | Routine Testing | (515) | (2.5) | 156 | 0.7 | | Research Services and CRO | (6,000) | (18.7) | (3,413) | (16.0) | - Oncology testing segment results turned from a profit to a loss of RMB 13.6 million, primarily due to operating losses and intangible asset amortization from the acquisition of Benchmark Medical[37] - CRO and research services segment loss expanded to RMB 6.0 million, primarily due to increased costs from establishing overseas laboratories[37] Other Income and Gains For the six months ended June 30, 2025, other income and gains were approximately RMB 48.9 million, a year-on-year decrease of approximately 11.0%, primarily due to reduced interest income from lower bank deposit rates - Other income and gains were approximately RMB 48.9 million, a year-on-year decrease of approximately 11.0%[38] - The decrease was primarily due to reduced interest income from lower bank deposit rates[38] Selling and Marketing Expenses For the six months ended June 30, 2025, selling and marketing expenses were approximately RMB 145.0 million, a year-on-year decrease of approximately 2.0%; selling and marketing expenses as a percentage of revenue increased by 0.5 percentage points from 31.2% in the prior period to 31.7% in the current period - Selling and marketing expenses were approximately RMB 145.0 million, a year-on-year decrease of approximately 2.0%[39] - Selling and marketing expenses as a percentage of revenue increased by 0.5 percentage points from 31.2% to 31.7%[39] Administrative Expenses For the six months ended June 30, 2025, administrative expenses were approximately RMB 56 million, a year-on-year increase of approximately 20.3%, primarily due to expenses related to the acquisition of Benchmark Medical and personnel adjustments - Administrative expenses were approximately RMB 56 million, a year-on-year increase of approximately 20.3%[40] - The increase was primarily due to expenses related to the acquisition of Benchmark Medical and personnel adjustments[40] Research and Development Costs For the six months ended June 30, 2025, R&D costs were approximately RMB 46.0 million, representing 10.1% of revenue; the company maintained a high level of R&D investment to sustain competitiveness and advance new specialized and testing technology layouts - R&D costs were approximately RMB 46.0 million, representing 10.1% of revenue[41] - The company maintained a high level of R&D investment to sustain competitiveness and advance new specialized and testing technology layouts[41] Other Expenses For the six months ended June 30, 2025, other expenses were approximately RMB 21.1 million, a year-on-year increase of approximately 18.2%, primarily due to changes in the fair value of funds - Other expenses were approximately RMB 21.1 million, a year-on-year increase of approximately 18.2%[42] - The increase was primarily due to changes in the fair value of funds[42] Finance Costs For the six months ended June 30, 2025, finance costs were approximately RMB 7.7 million, primarily related to bank borrowings - Finance costs were approximately RMB 7.7 million, primarily related to bank borrowings[43] Income Tax Expense For the six months ended June 30, 2025, income tax expense decreased by approximately 56.9% year-on-year to approximately RMB 2.0 million - Income tax expense decreased by approximately 56.9% year-on-year to approximately RMB 2.0 million[44] Loss for the Period Given the aforementioned reasons, for the six months ended June 30, 2025, the company incurred a loss of approximately RMB 32.6 million, representing a decrease of approximately 410.0% in net profit margin compared to the prior period - Loss for the period was approximately RMB 32.6 million, representing a decrease of approximately 410.0% in net profit margin compared to the prior period[45] Liquidity and Capital Resources As of June 30, 2025, the company's cash and cash equivalents increased by 18.6% to RMB 700.9 million; net cash outflow from operating activities was RMB 33.77 million, net cash inflow from investing activities was RMB 302.5 million, and net cash inflow from financing activities was RMB 56.0 million; the company maintained ample cash reserves and managed liquidity through bank borrowings and proceeds from the global offering, with a gearing ratio of 15.3% - As of June 30, 2025, cash and cash equivalents increased by 18.6% to RMB 700.9 million[49] - The company maintains ample cash reserves, with cash, cash equivalents, and time deposits totaling approximately RMB 1.88 billion[23] - The gearing ratio was 15.3%[52] Cash Flow Summary For the six months ended June 30, 2025, net cash used in operating activities was RMB 33.77 million, net cash generated from investing activities was RMB 302.5 million (primarily from matured bank time deposits), and net cash generated from financing activities was RMB 56.0 million (primarily from new bank loans); cash and cash equivalents at period-end increased to RMB 700.9 million Table: Cash Flow Summary | For the Six Months Ended June 30 | | :--- | | 2025 (RMB thousands) | 2024 (RMB thousands) | | Net cash flow used in operating activities | (33,769) | (70,249) | | Net cash flow from / (used in) investing activities | 302,487 | (969,483) | | Net cash flow from financing activities | 56,029 | 133,581 | | Net increase / (decrease) in cash and cash equivalents | 324,747 | (906,151) | | Cash and cash equivalents at end of period | 700,907 | 591,146 | - Net cash inflow from investing activities was primarily due to matured bank time deposits of RMB 438.9 million[49] - Net cash inflow from financing activities was primarily due to new bank loans of RMB 190.9 million[49] Foreign Exchange Risk The company primarily operates in China, with most transactions settled in RMB, which is also its presentation and functional currency; it does not face significant foreign exchange risk, with primary exposure from USD against RMB and HKD, and manages risk by regularly reviewing net foreign exchange exposure, with hedging activities not exceeding twelve months - Most transactions are settled in RMB, which is also the presentation and functional currency[50] - The company does not face significant foreign exchange risk, with primary exposure from USD against RMB and HKD[50] - Risk is managed by regularly reviewing net foreign exchange exposure, with hedging activities not exceeding twelve months[50] Indebtedness and Gearing Ratio As of June 30, 2025, the company had utilized credit facilities of approximately RMB 449.0 million and had unutilized bank financing of approximately RMB 370 million; total borrowings were approximately RMB 436.9 million, comprising approximately RMB 139 million in fixed-rate borrowings and approximately RMB 297.9 million in floating-rate borrowings, with a gearing ratio of 15.3% - Utilized credit facilities were approximately RMB 449.0 million, with unutilized bank financing of approximately RMB 370 million[51] - Total borrowings were approximately RMB 436.9 million, comprising approximately RMB 139 million in fixed-rate borrowings and approximately RMB 297.9 million in floating-rate borrowings[51] - The gearing ratio was 15.3%[52] Capital Expenditure For the six months ended June 30, 2025, total capital expenditure was RMB 25.142 million, a significant decrease from RMB 109.378 million in the prior period, primarily related to equipment purchases and laboratory renovations Table: Capital Expenditure | Capital Expenditure Item | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Purchase of property, plant and equipment | 24,519 | 95,216 | | Purchase of other intangible assets | 623 | 14,162 | | Total | 25,142 | 109,378 | - Total capital expenditure significantly decreased year-on-year, primarily related to equipment purchases and laboratory renovations[53][54] Contingent Liabilities As of June 30, 2025, the company had no significant contingent liabilities - As of June 30, 2025, the company had no significant contingent liabilities[55] Significant Investments and Future Plans As of June 30, 2025, the company held no significant investments; other than expansion plans disclosed in the prospectus, the company had no future plans regarding significant investments or capital assets - As of June 30, 2025, the company held no significant investments[56] - Other than expansion plans disclosed in the prospectus, the company had no future plans regarding significant investments or capital assets[56] Significant Acquisitions and Disposals For the six months ended June 30, 2025, the company made no significant acquisitions or disposals of subsidiaries, associates, or joint ventures - For the six months ended June 30, 2025, the company made no significant acquisitions or disposals of subsidiaries, associates, or joint ventures[57] Pledge of Group Assets As of June 30, 2025, Kindstar Shanghai's buildings were pledged as collateral for RMB 69,000,000 in bank borrowings; Kindstar Wuhan WFOE entered into a RMB 132,000,000 bank borrowing agreement with CITIC Bank, pledging 100% equity of Guangzhou Kangcheng Weiye Biotechnology Co., Ltd. - Kindstar Shanghai's buildings were pledged as collateral for RMB 69,000,000 in bank borrowings[58] - Kindstar Wuhan WFOE pledged 100% equity of Guangzhou Kangcheng Weiye Biotechnology Co., Ltd. to secure RMB 132,000,000 in bank borrowings[58] Employees and Share Incentive Schemes As of June 30, 2025, the company had 3,162 employees, primarily located in Hubei, Sichuan, Beijing, and Shanghai, offering comprehensive training and competitive compensation; as of the announcement date, share options to subscribe for 3,346,192 shares under the pre-IPO share incentive scheme remained unexercised, while no shares or share options were granted under the post-IPO restricted share unit scheme and share option scheme during the reporting period - As of June 30, 2025, the company had 3,162 employees[61] - The company provides new employee training, on-the-job training, quarterly online and in-person training, and encourages participation in external seminars[61] - As of the announcement date, share options to subscribe for 3,346,192 shares under the pre-IPO share incentive scheme remained unexercised[62] - No restricted share units or share options were granted under the post-IPO restricted share unit scheme and share option scheme during the reporting period[62] Employee Profile As of June 30, 2025, the company had 3,162 employees, primarily in Hubei, Sichuan, Beijing, and Shanghai; it continuously enhances employee technical knowledge and capabilities through regular, on-the-job, quarterly formal training, and external seminars, offering competitive compensation including salaries, discretionary bonuses, and benefit plans - As of June 30, 2025, there were 3,162 employees[61] - New employee training, on-the-job training, quarterly online and in-person training are provided, and participation in external seminars is encouraged[61] - Compensation is determined based on market conditions, individual performance, qualifications, and experience, offering competitive remuneration packages[61] Share Incentive Schemes The company adopted a pre-IPO share incentive scheme, with share options to subscribe for 3,346,192 shares remaining unexercised as of the announcement date; additionally, a post-IPO restricted share unit scheme and share option scheme were adopted on June 22, 2021, but no restricted share units or share options were granted under these schemes as of June 30, 2025 - Under the pre-IPO share incentive scheme, share options to subscribe for 3,346,192 shares remained unexercised[62] - No restricted share units or share options were granted under the post-IPO restricted share unit scheme and share option scheme during the reporting period[62] Significant Events After Reporting Period No significant events occurred after June 30, 2025, and up to the date of this announcement that could materially affect the company's operations and financial performance - No significant events occurred from the end of the reporting period to the announcement date that materially affected operations and financial performance[63] Use of Proceeds from Global Offering The net proceeds from the global offering, approximately HKD 2,053.6 million, have been and will continue to be utilized as intended in the prospectus; for the six months ended June 30, 2025, actual usage was HKD 156.7 million, with an unutilized balance of HKD 734.7 million, and the company currently has no intention to change the use of unutilized net proceeds, expecting full utilization by June 30, 2028 - Net proceeds from the global offering were approximately HKD 2,053.6 million[64] - For the six months ended June 30, 2025, actual usage was HKD 156.7 million, with an unutilized balance of HKD 734.7 million[65] - The company currently has no intention to change the use of unutilized net proceeds, expecting full utilization by June 30, 2028[66] Table: Use of Proceeds from Global Offering | Intended Use of Proceeds | Percentage of Intended Use (%) | Intended Use of Global Offering Proceeds (HKD millions) | Actual Usage for the Six Months Ended June 30, 2025 (HKD millions) | Unutilized Net Proceeds as of June 30, 2025 (HKD millions) | | :--- | :--- | :--- | :--- | :--- | | Sales and marketing of existing specialized testing service lines | 35 | 721.8 | 94.6 | 343.5 | | R&D for existing specialized testing service lines | 20.1 | 410.7 | 8.5 | 67.9 | | Development and commercialization of new specialized testing service lines | 15 | 308.0 | 44.6 | 106.9 | | Acquisitions of complementary and synergistic companies | 5 | 102.7 | 0 | 18.7 | | Strengthening testing capabilities | 10 | 205.4 | 9 | 0.1 | | Overseas expansion | 5 | 102.7 | 0 | 102.7 | | Working capital and other general corporate purposes | 10 | 205.4 | 0 | 94.9 | | Total | 100.0 | 2,053.6 | 156.7 | 734.7 | Interim Condensed Consolidated Financial Statements Interim Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income For the six months ended June 30, 2025, the company recorded a post-tax loss of RMB 32.636 million, compared to a profit of RMB 10.528 million in the prior period; loss attributable to owners of the parent company was RMB 36.073 million, with basic loss per share of RMB 3.78 cents Table: Interim Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income | Metric | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Revenue | 456,919 | 473,335 | | Gross Profit | 196,530 | 225,790 | | (Loss) / Profit Before Tax | (30,680) | 15,069 | | (Loss) / Profit for the Period | (32,636) | 10,528 | | (Loss) / Profit Attributable to Owners of the Parent | (36,073) | 11,895 | | Basic (Loss) / Earnings Per Share (RMB) | (0.0378) | 0.0125 | Interim Condensed Consolidated Statement of Financial Position As of June 30, 2025, the company's total non-current assets were RMB 1,688.917 million, total current assets were RMB 2,215.300 million, total current liabilities were RMB 838.067 million, total non-current liabilities were RMB 213.507 million, and net assets were RMB 2,852.673 million Table: Interim Condensed Consolidated Statement of Financial Position | Metric | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Total Non-Current Assets | 1,688,917 | 1,528,339 | | Total Current Assets | 2,215,300 | 2,246,527 | | Total Current Liabilities | 838,067 | 854,445 | | Total Non-Current Liabilities | 213,507 | 96,063 | | Net Assets | 2,852,673 | 2,824,358 | | Total Equity | 2,852,673 | 2,824,358 | Notes to the Financial Statements Company Information The company was incorporated in the Cayman Islands as an exempted company on August 24, 2007, with shares listed on the Main Board of the Hong Kong Stock Exchange since July 16, 2021; it is an investment holding company, and its principal subsidiaries are engaged in providing clinical testing services in China - The company was incorporated in the Cayman Islands on August 24, 2007, and its shares were listed on the Hong Kong Stock Exchange on July 16, 2021[71] - The company is an investment holding company, and its principal subsidiaries are engaged in providing clinical testing services in China[71] Basis of Preparation and Changes in Accounting Policies The interim condensed consolidated financial information is prepared in accordance with IAS 34 "Interim Financial Reporting" and should be read in conjunction with the annual consolidated financial statements for the year ended December 31, 2024; the accounting policies adopted are consistent with the 2024 annual consolidated financial statements, with no significant impact from new or revised IFRS effective from January 1, 2025 (e.g., amendments to IAS 21) on the Group's accounting policies - The interim condensed consolidated financial information is prepared in accordance with IAS 34 "Interim Financial Reporting"[72] - Accounting policies are consistent with the 2024 annual consolidated financial statements, and new or revised IFRS have no significant impact on the Group's accounting policies[73][74] Operating Segment Information The Group is divided into nine reportable operating segments by products and services, including hematology, genetic and rare diseases, infectious diseases, oncology, neurology, gynecology-related, routine testing, CRO and R&D projects, and others; management independently monitors each segment's performance for resource allocation and evaluation, and during the reporting period, most testing segments, except oncology testing, saw declining performance due to market conditions and hospital cost control pressures, with oncology testing incurring a loss due to the acquisition of Benchmark Medical - The Group is divided into nine reportable operating segments: hematology, genetic and rare diseases, infectious diseases, oncology, neurology, gynecology-related, routine testing, CRO and R&D projects, and others[76] - Management assesses segment performance based on reportable segment profit/loss, excluding other income and gains, administrative expenses, R&D costs, other expenses, and finance costs[75] - During the reporting period, most testing business segments, except oncology testing, experienced declining performance due to market conditions and hospital cost control pressures[37] - Oncology testing segment results turned from a profit to a loss of RMB 13.6 million, primarily due to operating losses and intangible asset amortization from the acquisition of Benchmark Medical[37] - CRO and research services segment loss expanded from RMB 3.4 million to RMB 6.0 million, primarily due to increased costs from establishing overseas laboratories[37] Revenue Analysis For the six months ended June 30, 2025, total company revenue was RMB 456.919 million, comprising RMB 424.860 million from clinical testing services and RMB 32.059 million from R&D project testing services and other income; performance obligations for clinical testing services are satisfied upon delivery of testing reports, while R&D project testing service revenue is recognized based on invoiced amounts for services rendered Table: Revenue by Service Type | Service Type | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Clinical testing services – at a point in time | 424,860 | 452,050 | | R&D project testing services and others – over time | 32,059 | 21,285 | | Total Revenue from Contracts with Customers | 456,919 | 473,335 | - Performance obligations for clinical testing services are satisfied upon delivery of testing reports, with payment generally due within 30 days from the invoice date[81] - R&D project testing services and other income are recognized based on the amounts the Group is entitled to invoice for services rendered[82] Details of (Loss) / Profit Before Tax For the six months ended June 30, 2025, the company incurred a pre-tax loss of RMB 30.680 million, primarily influenced by cost of services, depreciation and amortization, R&D costs, employee benefit expenses, finance costs, and fair value losses on financial assets; specifically, depreciation of property, plant and equipment was RMB 30.009 million, amortization of other intangible assets was RMB 11.933 million, and fair value loss on financial assets at fair value through profit or loss was RMB 10.150 million Table: Details of (Loss) / Profit Before Tax | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Cost of services provided | 259,532 | 247,545 | | Depreciation of property, plant and equipment | 30,009 | 21,219 | | Amortization of other intangible assets | 11,933 | 2,808 | | Research and development costs | 46,046 | 48,401 | | Employee benefit expenses (salaries and other benefits) | 172,655 | 154,570 | | Bank interest income | (35,478) | (42,222) | | Finance costs | 7,699 | 4,679 | | Fair value changes of financial assets at fair value through profit or loss | 10,150 | 966 | | Impairment losses on financial assets under expected credit loss model | 6,262 | 11,310 | Income Tax The Group is subject to income tax on profits arising in each jurisdiction; there is no income tax in the Cayman Islands, and no provision for Hong Kong due to no assessable profits; PRC subsidiaries are subject to a 25% corporate income tax rate, but five high-tech enterprises and four companies under the Western Development policy enjoy a preferential rate of 15%; total income tax expense for the reporting period was RMB 1.956 million, a 56.9% decrease from the prior period - There is no income tax in the Cayman Islands, and no assessable profits in Hong Kong[85][86] - PRC subsidiaries are subject to a corporate income tax rate of 25%, but nine subsidiaries enjoy a preferential tax rate of 15% (five are high-tech enterprises, four are located in Western China)[87] Table: Income Tax Expense | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Current income tax | 4,524 | 11,822 | | Under-provision in prior years | 5,049 | 2,224 | | Deferred income tax | (7,617) | (9,505) | | Total tax expense for the period | 1,956 | 4,541 | - Total tax expense for the period decreased by approximately 56.9% year-on-year[44][88] Basic and Diluted (Loss) / Earnings Per Share Attributable to Ordinary Equity Holders of the Parent For the six months ended June 30, 2025, basic loss per share attributable to ordinary equity holders of the parent company was RMB 3.78 cents, compared to earnings of RMB 1.25 cents in the prior period; diluted loss per share was also RMB 3.78 cents, with anti-dilutive share options and unvested restricted shares excluded from the calculation of both basic and diluted loss per share Table: Basic and Diluted (Loss) / Earnings Per Share | Metric | 2025 (RMB) | 2024 (RMB) | | :--- | :--- | :--- | | Basic (Loss) / Earnings Per Share | (0.0378) | 0.0125 | | Diluted (Loss) / Earnings Per Share | (0.0378) | 0.0124 | - The weighted average number of ordinary shares outstanding for basic loss per share calculation for the period was 954,305,654 shares[89][91] - Anti-dilutive share options and unvested restricted shares were not included in the calculation of basic and diluted loss per share[91] Dividends The 2024 final dividend of HKD 0.0238 per share (totaling approximately HKD 24,601,000) was paid on August 27, 2025; the Board has resolved not to declare an interim dividend for the six months ended June 30, 2025 - The 2024 final dividend of HKD 0.0238 per share (approximately HKD 24,601,000) was paid on August 27, 2025[92] - The Board has resolved not to declare an interim dividend for the six months ended June 30, 2025[60][92] Property, Plant and Equipment As of June 30, 2025, the net book value of property, plant and equipment was RMB 571.421 million; additions during the period amounted to RMB 26.411 million, and depreciation provision was RMB 30.009 million; certain buildings with a net book value of RMB 152.627 million were pledged as collateral for bank financing Table: Property, Plant and Equipment | Item | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Net book value | 571,421 | 575,064 | | Additions during the period | 26,411 | 206,911 | | Depreciation provision during the period | (30,009) | (45,163) | - As of June 30, 2025, certain buildings with a net book value of RMB 152,627,000 were pledged as collateral for the Group's general bank financing[94] Other Intangible Assets As of June 30, 2025, the net book value of other intangible assets was RMB 245.615 million, a significant increase from RMB 37.991 million on January 1, 2025, primarily due to licenses of RMB 207.379 million acquired through the acquisition of a subsidiary; amortization of RMB 11.933 million was recognized during the period Table: Other Intangible Assets | Item | June 30, 2025 (RMB thousands) | January 1, 2025 (RMB thousands) | | :--- | :--- | :--- | | Net book value | 245,615 | 37,991 | | Acquisition of subsidiaries | 207,379 | – | | Amortization provided during the period | (11,933) | – | - The significant increase in intangible assets was primarily due to licenses of RMB 207.379 million acquired through the acquisition of a subsidiary[95] Trade and Bills Receivables As of June 30, 2025, total trade and bills receivables amounted to RMB 637.074 million, with a net amount of RMB 501.871 million after deducting an expected credit loss provision of RMB 135.203 million; the credit period generally ranges from three to nine months, and the expected credit loss provision increased from the beginning of the year, primarily due to net impairment losses of RMB 6.262 million and RMB 1.034 million from the acquisition of a subsidiary Table: Trade and Bills Receivables | Item | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Total trade and bills receivables | 637,074 | 632,538 | | Provision for expected credit losses | (135,203) | (128,327) | | Total (Net) | 501,871 | 504,211 | - The credit period generally ranges from three to nine months, and the company strictly controls outstanding receivables to mitigate credit risk[96] - The provision for expected credit losses increased from the beginning of the year, primarily due to net impairment losses of RMB 6.262 million and RMB 1.034 million from the acquisition of a subsidiary[96] Table: Ageing Analysis of Trade and Bills Receivables | Ageing | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Within 1 year | 216,012 | 195,811 | | 1 to 2 years | 70,675 | 74,866 | | 2 to 3 years | 131,146 | 191,286 | | 3 to 4 years | 62,618 | 18,504 | | 4 to 5 years | 13,083 | 12,426 | | Over 5 years | 8,337 | 11,318 | | Total | 501,871 | 504,211 | Prepayments, Deposits and Other Receivables As of June 30, 2025, total prepayments, deposits, and other receivables amounted to RMB 115.596 million, with current portion at RMB 83.515 million and non-current portion at RMB 32.081 million (primarily representing VAT balances not expected to be recovered within the next 12 months); these balances are unsecured, have no history of default, and have negligible expected credit loss rates Table: Prepayments, Deposits and Other Receivables | Item | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Deposits and other receivables (current) | 68,777 | 56,649 | | Prepayments (current) | 12,052 | 11,694 | | Recoverable VAT (non-current) | 32,081 | 24,977 | | Total | 115,596 | 98,957 | - The non-current portion primarily represents VAT balances not expected to be recovered within the next 12 months[99] - The balances are unsecured, have no history of default, and have negligible expected credit loss rates[100] Time Deposits As of June 30, 2025, the company's total time deposits amounted to RMB 1,174.715 million; of this, non-current deposits over one year were RMB 330.000 million, bearing fixed annual interest rates of 2.45% to 2.85% and maturing between April and May 2027, while current deposits between three months and one year were RMB 844.715 million, bearing fixed annual interest rates of 4.19% to 4.64% Table: Time Deposits | Item | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Time deposits – current (over 3 months) | 844,715 | 1,217,543 | | Time deposits – non-current (over 1 year) | 330,000 | 410,000 | | Total | 1,174,715 | 1,627,543 | - Non-current deposits over one year amounted to RMB 330.000 million, bearing fixed annual interest rates of 2.45% to 2.85%, maturing between April and May 2027[101] - Current deposits between three months and one year amounted to RMB 844.715 million, bearing fixed annual interest rates of 4.19% to 4.64%[101] Financial Assets at Fair Value Through Profit or Loss As of June 30, 2025, financial assets at fair value through profit or loss (non-current) amounted to RMB 318.470 million, primarily investments in limited partnerships of unlisted funds, aimed at gaining broader exposure to the clinical testing industry Table: Financial Assets at Fair Value Through Profit or Loss | Item | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Investments in unlisted funds | 318,470 | 324,441 | | Financial assets at fair value through profit or loss – non-current | 318,470 | 324,441 | - Investments include subscriptions to limited partnerships of unlisted funds, enabling the Group to gain further exposure to a broader range of clinical testing industry participants[102] Trade and Bills Payables As of June 30, 2025, total trade and bills payables amounted to RMB 160.656 million, with RMB 137.412 million due within one year; trade payables are non-interest bearing and generally settled within 90 days Table: Ageing Analysis of Trade and Bills Payables | Ageing | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Within 1 year | 137,412 | 147,366 | | 1 to 2 years | 7,711 | 21,067 | | Over 2 years | 15,533 | 9,585 | | Total | 160,656 | 178,018 | - Trade payables are non-interest bearing and generally settled within 90 days[103] Other Payables and Accruals As of June 30, 2025, total other payables and accruals amounted to RMB 337.717 million, primarily comprising accruals of RMB 126.368 million, salaries payable of RMB 131.930 million, and other payables of RMB 77.419 million; these amounts are unsecured, non-interest bearing, and repayable on demand Table: Other Payables and Accruals | Item | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Accruals | 126,368 | 130,343 | | Salaries payable | 131,930 | 129,841 | | Other payables | 77,419 | 65,439 | | Consideration payable for equity acquisition | 2,000 | 4,900 | | Total | 337,717 | 330,523 | - Other payables are unsecured, non-interest bearing, and repayable on demand[104] Interest-Bearing Bank Borrowings As of June 30, 2025, total interest-bearing bank borrowings amounted to RMB 437.215 million, comprising current borrowings of RMB 245.915 million and non-current borrowings of RMB 191.300 million; borrowings include credit and secured loans, with interest rates ranging from benchmark rate minus 20-50 basis points to 2.60%-3.50%, and some borrowings are secured by Kindstar Shanghai's buildings and 100% equity of Guangzhou Kangcheng Weiye Biotechnology Co., Ltd. Table: Interest-Bearing Bank Borrowings | Item | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Current bank borrowings | 245,915 | 286,566 | | Non-current bank borrowings | 191,300 | 68,500 | | Total | 437,215 | 355,066 | - Kindstar Shanghai's buildings were pledged as collateral for RMB 69,000,000 in bank borrowings[106] - Kindstar Wuhan WFOE pledged 100% equity of Guangzhou Kangcheng Weiye Biotechnology Co., Ltd. to secure RMB 132,000,000 in bank borrowings[106]