中国金融发展(03623) - 2025 - 中期业绩

Financial Summary The company's revenue significantly decreased by 81.9% to Thousand RMB 9,863, while loss before tax narrowed by 75.2% to Thousand RMB (4,743) for the six months ended June 30, 2025 | Metric | Six Months Ended June 30, 2025 (Thousand RMB) | Six Months Ended June 30, 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Revenue | 9,863 | 54,511 | (81.9%) | | Other Income | 2,298 | 1,306 | 76.0% | | Loss Before Tax | (4,743) | (19,144) | (75.2%) | | Loss for the Period | (6,604) | (22,063) | (70.1%) | | Total Comprehensive Loss for the Period | (4,188) | (20,803) | (79.9%) | | Basic Loss Per Share (RMB) | (0.00) | (0.02) | (100.0%) | Statement of Financial Position (Period End): | Metric | June 30, 2025 (Thousand RMB) | December 31, 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Total Assets | 559,913 | 558,737 | 0.2% | | Total Equity | 283,769 | 237,724 | 19.4% | Interim Results Announcement The Board of Directors is pleased to announce the condensed consolidated financial statements for the six months ended June 30, 2025, with comparative figures for the same period in 2024 - The Board of Directors is pleased to announce the condensed consolidated financial statements for the six months ended June 30, 2025, and provides comparative data for the same period in 2024[4] Condensed Consolidated Financial Statements This section presents the condensed consolidated financial statements, including the statement of profit or loss, statement of profit or loss and other comprehensive income, and statement of financial position Condensed Consolidated Statement of Profit or Loss For the six months ended June 30, 2025, the Group's revenue significantly decreased by 81.9% to Thousand RMB 9,863, while loss for the period narrowed by 70.1% to Thousand RMB 6,604, primarily due to impairment and provisions credited | Metric | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Net Revenue | 9,863 | 54,511 | (81.9%) | | Other Income | 2,298 | 1,306 | 76.0% | | Impairment and Provisions Credited | 12,007 | 6,278 | 91.3% | | Impairment Loss on Property, Plant and Equipment | – | (15,613) | (100.0%) | | Operating Expenses | (17,505) | (20,739) | (15.7%) | | Loss Before Tax | (4,743) | (19,144) | (75.2%) | | Loss for the Period | (6,604) | (22,063) | (70.1%) | - Loss attributable to owners of the Company significantly decreased from Thousand RMB 9,630 in 2024 to Thousand RMB 894 in 2025[5] Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income The Group's total comprehensive loss for the six months ended June 30, 2025, significantly narrowed by 79.9% to Thousand RMB 4,188, mainly due to a reduction in loss for the period and increased other comprehensive income from currency translation of the Company's financial statements | Metric | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Loss for the Period | (6,604) | (22,063) | (70.1%) | | Currency Translation of the Company's Financial Statements | 9,700 | 3,451 | 181.1% | | Exchange Differences on Translation of Foreign Operations | (7,284) | (2,191) | 232.5% | | Total Comprehensive Loss for the Period | (4,188) | (20,803) | (79.9%) | - Total comprehensive loss attributable to owners of the Company turned from Thousand RMB (8,370) in 2024 to a comprehensive income of Thousand RMB 1,522 in 2025[6] Condensed Consolidated Statement of Financial Position As of June 30, 2025, the Group's total assets slightly increased by 0.2% to Thousand RMB 559,913, while total equity significantly grew by 19.4% to Thousand RMB 283,769, primarily driven by an increase in share capital and reserves | Metric | June 30, 2025 (Thousand RMB) | December 31, 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Total Assets | 559,913 | 558,737 | 0.2% | | Cash and Bank Balances | 224,222 | 185,561 | 20.8% | | Pledged Bank Deposits | 5,194 | 33,009 | (84.3%) | | Total Liabilities | 276,144 | 321,013 | (14.0%) | | Total Equity | 283,769 | 237,724 | 19.4% | | Share Capital | 5,129 | 4,421 | 16.0% | | Reserves | 334,383 | 283,336 | 18.0% | - Guaranteed liabilities and interest-bearing borrowings both showed significant decreases, reducing by 62.2% and 15.8% respectively[7] Notes to the Condensed Consolidated Financial Statements This section details the principal accounting policies, revenue and segment reporting, other income, loss before tax, income tax, loss per share, and various receivables and borrowings Principal Accounting Policies This interim financial report is prepared under the historical cost convention, consistent with the 2024 annual financial statements, with no significant impact from new/revised HKFRSs effective January 1, 2025 - The condensed interim financial report is prepared under the historical cost convention, with certain assets measured at fair value[8] - The adoption of new/revised Hong Kong Financial Reporting Standards (such as amendments to HKAS 21) has no significant impact on the Group's condensed interim financial report[9] Revenue and Segment Reporting The Group's total revenue significantly decreased by 81.9% to Thousand RMB 9,863, primarily due to reduced energy storage and online finance guarantee income, despite growth in consultancy fees and a shift to breeding services in the market hogs segment Revenue The Group's total revenue significantly decreased, primarily dragged down by online finance guarantee income and energy storage system sales, while consultancy and maintenance service fees and breeding service income achieved growth | Revenue Category | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Net Guarantee Fee Income | 1,078 | 14,131 | (92.4%) | | Consultancy and Maintenance Service Fees | 5,088 | 118 | 4211.9% | | Finance Lease Income | 453 | 647 | (30.0%) | | Sale of Market Hogs | – | 4,362 | (100.0%) | | Breeding Service Income | 3,244 | – | N/A | | Sale of Energy Storage Systems | – | 35,253 | (100.0%) | | Net Revenue | 9,863 | 54,511 | (81.9%) | Segment Reporting The Group's operations are divided into Financial Services, Market Hogs, and Energy Storage segments, with Financial Services showing increased profit before tax, while both Market Hogs and Energy Storage segments recorded losses, the latter significantly due to no revenue - The Group's operating segments include financial services (guarantee, factoring, finance lease, consultancy and maintenance), market hogs (sales and breeding services), and energy storage (overseas energy storage system trading)[13] Segment Profit (Loss) Before Tax | Segment | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Financial Services | 7,070 | 6,351 | 11.3% | | Market Hogs | (8,696) | (25,409) | (65.8%) | | Energy Storage | (3,117) | (86) | 3524.4% | | Total | (4,743) | (19,144) | (75.2%) | - Revenue from the Financial Services segment decreased from Thousand RMB 14,896 to Thousand RMB 6,619, but profit before tax increased significantly due to a substantial rise in impairment and provisions credited[14] - The Market Hogs segment shifted from a sales model to a breeding service model, recording Thousand RMB 3,244 in breeding service income in 2025, but still incurred a loss due to higher costs[14] - The Energy Storage segment had no revenue in 2025, leading to a significant increase in loss before tax from Thousand RMB 86 to Thousand RMB 3,117[14] Geographical Information In the first half of 2025, all of the Group's revenue originated from Mainland China, a significant shift from the same period in 2024 when a substantial portion came from energy storage business in South Africa, indicating a major change in business geographical distribution Revenue by Geographical Location of Customers | Region | 2025 (Thousand RMB) | 2024 (Thousand RMB) | | :--- | :--- | :--- | | Mainland China | 9,863 | 19,258 | | South Africa | – | 35,253 | | Total | 9,863 | 54,511 | - Non-current assets are primarily located in Mainland China, amounting to Thousand RMB 167,663 as of June 30, 2025, and Thousand RMB 438 in Hong Kong[16] Other Income The Group's other income increased by 76.0% year-on-year to Thousand RMB 2,298, primarily driven by the recovery of bad debts | Income Category | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Bank Deposit Interest Income | 1,063 | 1,091 | (2.6%) | | Recovery of Bad Debts | 818 | – | N/A | | Others | 417 | 204 | 104.4% | | Total | 2,298 | 1,306 | 76.0% | Loss Before Tax The Group's loss before tax significantly narrowed by 75.2% year-on-year to Thousand RMB 4,743, mainly due to increased impairment and provisions credited, and a reduction in impairment loss on property, plant and equipment Items (Credited) Debited to Loss Before Tax | Item | 2025 (Thousand RMB) | 2024 (Thousand RMB) | | :--- | :--- | :--- | | Impairment and Provisions Credited | (12,007) | (6,278) | | Staff Costs | 7,379 | 8,253 | | Depreciation Expense | 6,151 | 6,272 | | Net Exchange Loss | 2,567 | 851 | | Interest Expense | 3,797 | 5,410 | - Provisions credited for guarantees issued increased from Thousand RMB (4,848) in 2024 to Thousand RMB (11,012) in 2025[19] - Staff costs decreased by 10.6% year-on-year, and interest expense decreased by 29.9% year-on-year[19][20] Income Tax The Group's income tax expense decreased by 34.5% year-on-year to Thousand RMB 1,861, primarily due to the reversal of deferred tax assets | Metric | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Deferred Tax | (1,861) | (2,919) | (36.2%) | | Income Tax Expense | (1,861) | (2,919) | (34.5%) | Loss Per Share The Group's basic loss per share decreased from RMB 0.02 in 2024 to RMB 0.00 in 2025, mainly due to a significant reduction in loss attributable to owners of the Company | Metric | 2025 (RMB) | 2024 (RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Basic Loss Per Share | (0.00) | (0.02) | (100.0%) | - Basic loss per share is calculated based on the loss attributable to owners of the Company of Thousand RMB 894 (2024: Thousand RMB 9,630) and a weighted average number of shares of 566,443 thousand shares (2024: 552,307 thousand shares)[22] Trade and Other Receivables The Group's total trade and other receivables decreased by 14.4% year-on-year to Thousand RMB 74,987, primarily due to a reduction in prepayments for construction works and prepayments to former non-controlling interests of a subsidiary, both net of loss allowance | Item | June 30, 2025 (Thousand RMB) | December 31, 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Trade Receivables (Net of Loss Allowance) | 18,439 | 18,234 | 1.1% | | Deposits and Other Receivables (Net of Loss Allowance) | 39,447 | 40,645 | (2.9%) | | Prepayments for Construction Works (Net of Loss Allowance) | 7,696 | 18,742 | (58.9%) | | Prepayments to Former Non-Controlling Interests of a Subsidiary | 3,643 | 4,626 | (21.3%) | | Total | 74,987 | 87,592 | (14.4%) | - The aging analysis of trade receivables shows that amounts over one year account for the largest portion, at Thousand RMB 130,051[24] Factoring Receivables The carrying amount of the Group's factoring receivables slightly decreased by 1.7% to Thousand RMB 11,567, with most of it being overdue | Item | June 30, 2025 (Thousand RMB) | December 31, 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Carrying Amount of Factoring Receivables | 11,567 | 11,769 | (1.7%) | | Loss Allowance for Factoring Receivables | (40,024) | (40,221) | (0.5%) | - As of June 30, 2025, Thousand RMB 44,215 of factoring receivables were contractually overdue, remaining consistent with the end of last year[26] Finance Lease Receivables The carrying amount of the Group's finance lease receivables slightly increased by 1.5% to Thousand RMB 31,329, with the non-overdue portion remaining stable | Item | June 30, 2025 (Thousand RMB) | December 31, 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Carrying Amount of Finance Lease Receivables | 31,329 | 30,859 | 1.5% | | Loss Allowance for Finance Lease Receivables | (144,527) | (146,067) | (1.1%) | - Non-overdue finance lease receivables amounted to Thousand RMB 16,000, consistent with the end of last year[28] Changes in Property, Plant and Equipment The Group saw an increase in property, plant and equipment additions and a reclassification of prepayments for construction works to property, plant and equipment, with no impairment loss recognized this period, contrasting with a significant impairment loss recognized in the prior period - The cost of property, plant and equipment acquired this period was Thousand RMB 95 (2024: Thousand RMB 58)[29] - Thousand RMB 11,046 of prepayments for construction works were reclassified to property, plant and equipment (2024: nil)[29] - No impairment loss on property, plant and equipment was recognized this period (2024: Thousand RMB 15,613)[29] Interest-Bearing Borrowings The Group's total interest-bearing borrowings decreased by 15.8% year-on-year to Thousand RMB 120,662, primarily due to a reduction in unsecured other borrowings, with loans from the controlling shareholder fully settled | Borrowing Category | June 30, 2025 (Thousand RMB) | December 31, 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Secured Bank Borrowings | 118,069 | 125,649 | (6.0%) | | Unsecured Other Borrowings | 2,593 | 17,550 | (85.2%) | | Total | 120,662 | 143,199 | (15.8%) | - Loans from the controlling shareholder, Expert Depot Limited, were fully settled during this period, decreasing from Thousand RMB 15,280 to zero[30][32] - Bank borrowings are primarily secured by ordinary shares of subsidiaries, prepayments for construction works, and property, plant and equipment[30] Dividends For the six months ended June 30, 2025, the Company did not declare an interim dividend, consistent with the prior period - No interim dividend was declared for the current period or the prior period[33] Management Discussion and Analysis This section provides an overview of the Group's performance, industry and business review, financial review, liquidity and capital resources, and future prospects and outlook Overview In the first half of 2025, the global economic recovery remained weak, and Mainland China's economy saw a slow recovery but lacked sufficient effective demand; in this complex environment, the Group adhered to prudent principles, developing traditional businesses, adjusting supply chain finance, and exploring new areas for stable growth - The global economy is experiencing a difficult recovery with "weak resilience," facing challenges such as sluggish external demand, trade protectionism, and geopolitical conflicts[34] - Mainland China's GDP grew by 5.3% year-on-year, with a slow economic recovery, but effective demand remains insufficient, and private fixed asset investment decreased by 0.6% year-on-year[34][35] - The Group is responding to the complex and severe external environment by prudently developing traditional businesses, adjusting integrated supply chain financial services, and exploring new sector opportunities[35] Industry and Business Review The Group maintained prudent financial services, expanded electronic bidding guarantees, shifted hog breeding to a service model, addressed international energy storage challenges by exploring new markets, and ventured into digital assets via exchangeable bonds Prudent and Stable Development of Traditional Businesses The Group's financial segment prioritized risk control, expanded FinTech, launched electronic bidding guarantees, and adjusted finance lease strategies, despite lower-than-expected guarantee income due to market conditions - Mainland China's government implemented proactive fiscal and moderately loose monetary policies, but small and medium-sized enterprises still face operational pressure and slow growth in financing demand[36] - The financial segment continued its prudent strategy, optimizing risk management, deepening FinTech deployment, and enhancing competitiveness through diversified cooperation[37] - Guarantee business income was below expectations due to slow growth in financing demand from small and medium-sized enterprises and increased fee sensitivity during the economic recovery phase[37] - New electronic bidding guarantee services were launched, utilizing blockchain technology to provide small-amount, dispersed, and controllable electronic bidding guarantee services, with increased income expected in the second half of the year[38] - Cooperation with regional commercial banks is progressing to launch specialized finance guarantee products for agricultural trading markets[39] - During the reporting period, the Group experienced no customer defaults on borrowings or payment obligations, and recovered approximately RMB 820,000 in accounts receivable[39] - The finance lease industry faces stricter regulation and market competition, prompting the Group to adjust its operating strategy, prudently select businesses, and strengthen risk prevention and control[40] Implementation of Hog Breeding Services The Group continues to focus on the hog breeding service model, collaborating with state-owned enterprises, with the first round of services completed and the second round initiated, expecting increased revenue; this model mitigates market price fluctuation risks, but the segment still recorded a loss due to depreciation and operating expenses - Mainland China's hog breeding industry policy focuses on capacity regulation and disease prevention, with intense pig price fluctuations and accelerated scaling up of breeding enterprises[41] - The Group provides specialized breeding services to high-quality hog breeding enterprises, with the first round of cooperation completed and the second round of breeding services initiated, expecting the number of hogs to increase to approximately 29,000 head[42] - The breeding service model mitigates market price fluctuation uncertainties and reduces operating risks, but the market hogs segment still recorded a loss due to significant depreciation costs, operating expenses, and finance costs[43] Obstacles in International Energy Storage Supply Chain Business The Group's international energy storage business recorded no revenue during the reporting period, primarily due to intense competition in the South African market and no new orders; the company is seeking new distributors and actively developing markets in Australia, Northern Europe, and the UK, having secured some orders and prepayments - The international energy storage business faces challenges such as intensified industry competition, new trade barriers, fierce price wars, and more[44] - No revenue was recorded from energy storage system sales during the reporting period, mainly due to intense competition in the South African market and no new sales orders with distributors[44] - Other high-quality local distributors have been identified in South Africa, with preliminary cooperation intentions reached, and sales of goods are expected to resume in the second half of the year[44] - Actively developing markets in Australia, Northern Europe, and the UK; certification applications are underway in Australia, relevant product orders and partial prepayments have been secured in the UK, and sales distributors have been identified in Northern Europe[45] - An experienced operations team has been assembled to enhance R&D capabilities and improve sales potential[45] Venturing into Digital Asset Sector The Group ventured into the digital asset sector by subscribing to exchangeable bonds, with the target company registered in Oman and aiming to become Oman's first cryptocurrency OTC and exchange platform, intending to diversify its investment portfolio and explore the potential of emerging finance - The digital asset sector, as a key direction for global financial transformation, has significant growth potential, and the Omani cryptocurrency market is in an expansion phase[46] - The Group ventured into the digital asset sector by subscribing to exchangeable bonds, with the cooperative target company, Coin Cove LLC, registered with the Central Bank of Oman Financial Services Authority[46] - This move aims to diversify the Group's investment portfolio, generate stable interest income, and explore the potential of the emerging financial industry in the Sultanate of Oman[46] Financial Review The Group's revenue significantly decreased by 81.9% due to reduced finance guarantee and energy storage sales, but strong growth in advisory services, new breeding income, increased impairment credits, and no property impairment loss collectively narrowed the loss before tax Revenue The Group's total revenue significantly decreased, primarily dragged down by finance guarantee and energy storage system sales income, while consultancy and maintenance service fees and breeding service income achieved growth | Revenue Category | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Net Income from Finance Guarantee Services | 1,100 | 14,100 | (92.2%) | | Income from Non-Finance Guarantee Services | 20 | 40 | (50.0%) | | Income from Financial Advisory and Maintenance Services | 5,100 | 100 | 5000.0% | | Income from Sale of Market Hogs | – | 4,400 | (100.0%) | | Income from Hog Breeding Services | 3,200 | – | N/A | | Income from Sale of Energy Storage Systems | – | 35,300 | (100.0%) | | Total Revenue | 9,900 | 54,500 | (81.9%) | - Net income from finance guarantee services significantly decreased by 92.2%, mainly due to the impact of external economic conditions and a slowdown in financing demand from small and medium-sized enterprises[47] - Income from financial advisory and maintenance services significantly increased to RMB 5.1 million, stemming from providing business management system technical consulting and maintenance services to customers[49] - Income from hog breeding services was RMB 3.2 million, but costs amounted to RMB 6.3 million, resulting in a gross loss[51] - No revenue was recorded from energy storage system sales due to intense competition in the South African market and no new sales orders[52] Other Income The Group's other income increased by 76.0% year-on-year to RMB 2.3 million, primarily from the recovery of bad debts | Item | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Bank Deposit Interest Income | 1,063 | 1,091 | (2.6%) | | Recovery of Bad Debts | 818 | – | N/A | | Others | 417 | 204 | 104.4% | | Total | 2,298 | 1,306 | 76.0% | Impairment and Provisions Debited / (Credited) Impairment and provisions debited / (credited) for the period amounted to Thousand RMB (12,007), primarily due to the reversal of provisions for guarantees issued resulting from a significant decrease in outstanding guarantees and guarantee income | Item | 2025 (Thousand RMB) | 2024 (Thousand RMB) | | :--- | :--- | :--- | | Provisions Credited for Guarantees Issued | (11,012) | (4,848) | | Total Impairment Provisions Debited (Credited) | (1,000) | (1,430) | | Total | (12,007) | (6,278) | - Provisions credited for guarantees issued increased significantly to approximately RMB 11.0 million, compared to RMB 4.8 million in the prior period[54] Impairment Loss on Property, Plant and Equipment No impairment loss provision was recognized for property, plant and equipment this period, contrasting with a Thousand RMB 15.6 million impairment loss recognized in the prior period, mainly because the recoverable amount of related non-current assets did not significantly differ from their carrying amount - For the six months ended June 30, 2025, the Group did not recognize an impairment loss provision for property, plant and equipment (2024: impairment loss of approximately RMB 15.6 million)[55] Operating Expenses The Group's operating expenses (including R&D costs) decreased by 16.0% year-on-year to RMB 17.9 million, primarily due to reductions in salaries and wages and depreciation expenses | Item | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Salaries and Wages | 7,379 | 8,253 | (10.6%) | | Depreciation Expenses | 2,228 | 5,691 | (60.8%) | | Intermediary and Consulting Fees | 2,608 | 3,402 | (23.3%) | | Exchange Loss | 2,567 | 851 | 201.6% | | Total | 17,925 | 21,274 | (16.0%) | - The decrease in salaries and wages was mainly due to the Group's salary adjustments for some employees[56] - The decrease in depreciation expenses was mainly because the market hogs segment expanded its operating scale, with more depreciation allocated to breeding costs rather than operating expenses[56] Loss Before Tax The Group's loss before tax significantly decreased by 75.2% year-on-year to RMB 4.7 million, primarily attributable to no impairment loss provision made for property, plant and equipment | Metric | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Loss Before Tax | (4,743) | (19,144) | (75.2%) | - The reduction in loss before tax was mainly due to no impairment loss provision made for property, plant and equipment during the reporting period[58] Income Tax The Group's income tax expense decreased by 34.5% year-on-year to RMB 1.9 million, primarily due to the reversal of deferred tax assets | Metric | 2025 (Thousand RMB) | 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Income Tax Expense | (1,861) | (2,919) | (34.5%) | Liquidity and Capital Resources The Group's cash and bank balances increased, pledged bank deposits decreased, and the capital gearing ratio significantly declined, indicating improved liquidity and reduced financial leverage, mainly due to share issuance through placing and a reduction in total liabilities - The Group seeks other investment opportunities that offer better returns with lower risks to effectively utilize financial resources[60] | Item | June 30, 2025 (Thousand RMB) | December 31, 2024 (Thousand RMB) | Change Percentage | | :--- | :--- | :--- | :--- | | Pledged Bank Deposits | 5,200 | 33,000 | (84.3%) | | Cash and Bank Balances | 224,200 | 185,600 | 20.8% | - The increase in cash and bank balances primarily resulted from the Group's share issuance through placing during the reporting period[62] - The capital gearing ratio decreased from approximately 135% as of December 31, 2024, to approximately 97.3% as of June 30, 2025, mainly due to a reduction in total liabilities, particularly guaranteed liabilities and interest-bearing borrowings[64] Prospects and Outlook Looking ahead to the second half of 2025, the Group anticipates slower global economic growth and challenges for Mainland China's economy such as weak demand; the Group will continue to adhere to prudent and stable operating principles, cautiously develop traditional businesses, explore adjustments to the hog supply chain business, restore international energy storage business, and steadily advance its digital asset sector initiatives Macro Outlook Global economic growth is expected to continue slowing in the second half of 2025, with Mainland China's economy facing multiple challenges, prompting the government to strengthen macro-policy adjustments; the Group will adhere to prudent and stable operating principles, striving for sustainable growth through developing traditional businesses, adjusting supply chain services, and exploring new areas - Global economic growth continues to slow amidst multiple uncertainties, constrained by trade protectionism, geopolitical conflicts, and other structural challenges[65] - Mainland China's economy faces issues such as weak demand, structural overcapacity, and deflationary pressure, prompting the government to strengthen macro-policy adjustments[65] - The Group will strive for sustainable growth in a complex environment by prudently developing traditional businesses, adjusting and optimizing supply chain services, and exploring new sector opportunities[65] Prudent Development of Traditional Businesses The Group will continue to deepen risk management in its guarantee business, strengthen cooperation with banks to launch customized products, and expand the coverage of electronic bidding guarantee services; the finance lease business will enhance risk prevention and control and actively pursue the recovery of receivables related to local government debts - The guarantee business will continue to adhere to the "risk first, business second" principle, deepen risk management, strengthen synergistic cooperation with banks, and launch customized guarantee products[66] - Continue to expand cooperation with more regional public resource trading centers, conduct low-risk businesses, and broaden service coverage[66] - The finance lease business will strengthen risk prevention and control, leverage policy support, and fully communicate with relevant parties to implement the recovery of receivables[66] Exploring Opportunities to Adjust Hog Supply Chain Business The Group will continue to provide efficient breeding solutions to high-quality cooperative enterprises, driving growth in breeding service income by strengthening cooperation, increasing pen utilization, and enhancing professional capabilities; concurrently, research and evaluation of new models and solutions for the hog supply chain business have been initiated - Mainland China's hog breeding industry will implement regulatory policies, but overcapacity pressure will still take time to digest, requiring enterprises to actively respond[67] - The Group will strengthen strategic cooperation with high-quality hog breeding enterprises in the industry, increase pen utilization, enhance the capabilities of professional teams, and promote steady growth in breeding service income[67] - Management believes that not engaging in the fattening model in the second half of the year is appropriate[67] - Research and evaluation of new models and solutions for the hog supply chain business have been initiated to enhance the Group's overall profitability[67] Restoring International Energy Storage Business The Group will intensify communication and collaboration with new distributors in South Africa to re-enter the market as soon as possible, conduct in-depth research on global energy storage market competition, and adjust market strategies; concurrently, it will implement its Northern European market strategy, advance certification progress in Australia, and closely monitor global industry dynamics for new development opportunities - The global energy storage market is expected to maintain high growth but faces challenges such as technological innovation, trade barriers, intense competition, and policy uncertainties[68] - The Group will intensify communication and collaboration with new distributors in South Africa to strive for a prompt re-entry into the market, and conduct in-depth research on global market competition to adjust market strategies[69] - In the Northern European market, the Group will implement its strategy for new marine shore charging pile products and high-voltage battery systems; in Australia, it will expedite relevant certification progress[69] Venturing into Digital Asset Sector The Group highly values the development trends in the digital asset sector, will continuously monitor the performance of its Oman investment project, and establish a dedicated team to explore development opportunities in digital assets and real-world asset (RWA) tokenization, seeking collaborations to create new performance growth points for the Group, while adhering to prudent principles and steadily advancing under legal and compliant premises - Digital assets, as a strategic emerging sector with broad prospects, continue to expand globally, with Hong Kong having implemented the "Stablecoin Ordinance"[70] - The Group will continuously monitor the development and performance of its Oman investment project and establish a dedicated team to explore development opportunities in digital assets, real-world assets (RWA), and other areas[70] - The Group will adhere to prudent principles, steadily advance projects under legal and compliant premises, and strictly follow listing rules for disclosure of progress[70] Other Information This section covers dividend policy, corporate governance, directors' securities transactions, audit committee, share transactions, competition, public float, post-reporting period events, publication of reports, acknowledgements, and board composition Dividends The Board of Directors resolved not to declare an interim dividend for the six months ended June 30, 2025 - No interim dividend was declared for the current period[71] Corporate Governance The Company has adopted and complied with the code provisions in Appendix C1 of the Listing Rules and will continue to review and strengthen its corporate governance practices - The Company has adopted and complied with the code provisions in Appendix C1 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[72] Standard Code for Securities Transactions by Directors The Company has adopted the Standard Code as set out in Appendix C3 of the Listing Rules, and all Directors confirmed full compliance with the code during the reporting period - The Company has adopted the Standard Code as set out in Appendix C3 of the Listing Rules as the code of conduct for Directors' dealings in the Company's listed securities[74] - All Directors confirmed full compliance with the Standard Code during the six months ended June 30, 2025[74] Audit Committee The Company's Audit Committee, established on October 18, 2013, is primarily responsible for advising on the appointment of external auditors, reviewing financial statements, and coordinating internal control procedures; this interim announcement has been reviewed by the Audit Committee and the auditors - The Audit Committee's primary responsibilities include advising on the appointment and removal of external auditors, reviewing financial statements, and coordinating internal control procedures and risk management[75] - The Audit Committee members include Mr Tsang Hung Kei (Chairman), Mr Au Tin Kei, and Mr Chow Siu Kong, all of whom are independent non-executive Directors[75] - This interim announcement has been reviewed by the Audit Committee and the Company's auditors, RSM Hong Kong[76] Purchase, Sale or Redemption of the Company's Listed Securities and Treasury Shares The Group completed the placing of 77,000,000 new shares in May 2025, raising net proceeds of approximately HKD 53.36 million, primarily for subscribing to exchangeable bonds, repaying existing loans, and general working capital; during the reporting period, some share options were exercised Placing The Group completed the placing of 77,000,000 new shares in May 2025, raising net proceeds of approximately HKD 53.36 million, primarily for subscribing to exchangeable bonds, repaying existing loans, and general working capital - On May 26, 2025, the Group completed the placing of 77,000,000 new shares at a placing price of HKD 0.70 per share to no less than six independent placees[77] - The net proceeds from the placing, approximately HKD 53.36 million, are intended for the cash consideration for subscribing to exchangeable bonds, repayment of existing loans and outstanding amounts, and general working capital for the Group[78] Share Options For the six months ended June 30, 2025, 86,000 and 90,000 share options under the 2020 and 2023 share option schemes, respectively, were exercised; the 2025 share options have not yet vested - For the six months ended June 30, 2025, 86,000 share options under the 2020 share option scheme were exercised[79] - For the six months ended June 30, 2025, 90,000 share options under the 2023 share option scheme were exercised[79] - Share options to subscribe for 9,000,000 shares under the 2025 share option scheme remain outstanding but have not yet vested[80] Competition and Conflicts of Interest During the review period, none of the Company's Directors, controlling shareholders, or substantial shareholders and their associates engaged in any business that competed or might compete with the Group's business, nor were there any other conflicts of interest - None of the Company's Directors, controlling shareholders or substantial shareholders or any of their respective associates engaged in any business that competed or might compete with the Group's business or had any other conflicts of interest during the review period[81] Public Float As of the date of this announcement, the Company has maintained the public float as required by the Hong Kong Listing Rules - The Company has maintained the public float as required by the Hong Kong Listing Rules[82] Events After Reporting Period There have been no significant post-reporting period events for the Company or the Group after June 30, 2025, and up to the date of this announcement - There have been no significant post-reporting period events for the Company or the Group after June 30, 2025, and up to the date of this announcement[83] Publication of Interim Results Announcement and Interim Report This announcement has been published on the Company's website and the HKEXnews website, and the interim report will also be published on these websites - This announcement has been published on the Company's website (http://www.chinasuccessfinance.com) and the HKEXnews website (www.hkexnews.hk)[84](index=84&type=chunk) - The Company's interim report for the six months ended June 30, 2025, will also be published on the aforementioned websites[84] Acknowledgements The Board of Directors extends its gratitude to management, all employees, loyal shareholders, investors, customers, business partners, associates, banks, and auditors for their support and contributions - The Board of Directors expresses its gratitude for the unwavering support and contributions of the Group's management and all employees[85] - The Board of Directors also thanks loyal shareholders, investors, customers, business partners, associates, as well as banks and auditors for their continued confidence in the Group's prospects[85] Board Composition As of the date of this announcement, the Board of Directors comprises five executive directors and three independent non-executive directors - The Board of Directors includes five executive directors: Mr Zhang Tiewei, Mr Li Bin, Ms Dai Jing, Mr Xu Kaiying, and Mr Pang Haoquan[87] - The Board of Directors includes three independent non-executive directors: Mr Tsang Hung Kei, Mr Au Tin Kei, and Mr Chow Siu Kong, all of whom are independent non-executive Directors[87]