三花智控(02050) - 2025 - 中期业绩

2025 Interim Results Announcement This report details Zhejiang Sanhua Intelligent Controls Co., Ltd.'s unaudited condensed consolidated interim results for H1 2025 2025 Interim Results Highlights The company reported unaudited interim results for H1 2025, with revenue up 18.9%, profit attributable to owners up 39.3%, and EPS up 42.5% 2025 Interim Results Highlights | Indicator | Six Months Ended June 30, 2025 (RMB million) | Year-on-Year Growth Rate | | :--- | :--- | :--- | | Revenue | 16,262.8 | 18.9% | | Profit attributable to owners of the Company | 2,109.9 | 39.3% | | Basic and diluted earnings per share | 0.57 RMB | 42.5% | Condensed Consolidated Interim Financial Statements This section provides an overview of the company's unaudited condensed consolidated interim statements of profit or loss, comprehensive income, and financial position - The financial statements, including the statement of profit or loss, comprehensive income, and financial position, are all unaudited[5][6][8] Condensed Consolidated Interim Statement of Profit or Loss For H1 2025, the company reported revenue of RMB 16.26 billion, operating profit of RMB 2.58 billion, and profit attributable to owners of RMB 2.11 billion Condensed Consolidated Interim Statement of Profit or Loss | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Revenue | 16,262,787 | 13,676,072 | | Cost of sales | (11,740,637) | (9,963,304) | | Gross profit | 4,522,150 | 3,712,768 | | Operating profit | 2,580,349 | 1,886,904 | | Profit for the period | 2,138,111 | 1,521,665 | | Profit attributable to owners of the Company | 2,109,940 | 1,514,515 | | Basic and diluted earnings per share | 0.57 | 0.40 | Condensed Consolidated Interim Statement of Comprehensive Income For H1 2025, total comprehensive income was RMB 2.29 billion, driven by profit for the period and foreign currency translation differences Condensed Consolidated Interim Statement of Comprehensive Income | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Profit for the period | 2,138,111 | 1,521,665 | | Foreign currency translation differences for overseas operations | 153,225 | (170,920) | | Total comprehensive income for the period | 2,291,336 | 1,350,745 | | Attributable to owners of the Company | 2,263,165 | 1,343,595 | Condensed Consolidated Interim Statement of Financial Position As of June 30, 2025, total assets were RMB 46.38 billion, total liabilities RMB 17.07 billion, and total equity RMB 29.31 billion, driven by increased cash and receivables Condensed Consolidated Interim Statement of Financial Position | Indicator | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Total assets | 46,382,832 | 36,354,749 | | Total non-current assets | 14,881,039 | 14,053,586 | | Total current assets | 31,501,793 | 22,301,163 | | Total liabilities | 17,071,175 | 16,835,105 | | Total equity | 29,311,657 | 19,519,644 | Notes to the Unaudited Condensed Consolidated Interim Financial Statements This section provides detailed notes on general information, accounting policies, operating segments, income tax, dividends, EPS, PPE, receivables, payables, and borrowings - The Group primarily engages in the research, development, production, and sale of refrigeration and air conditioning components and automotive components, widely used in refrigeration, air conditioning, and automotive markets, including new energy vehicles[11] - The condensed consolidated interim financial statements are prepared in accordance with International Accounting Standard 34 and Appendix D2 of the Listing Rules, and measured on a historical cost basis[12] General Information Zhejiang Sanhua Intelligent Controls Co., Ltd., incorporated in China, specializes in R&D, manufacturing, and sales of refrigeration and automotive components, listed on Shenzhen and Hong Kong stock exchanges - The company's predecessor was established in 1994, converted into a joint-stock company in 2001, and listed in Shenzhen in 2005 and Hong Kong in 2025[10] - Its main businesses cover the research, development, production, and sales of refrigeration and air conditioning components, and automotive components (including new energy vehicles and traditional fuel vehicles)[11] Basis of Preparation and Presentation Interim financial statements are prepared under IAS 34 and HKEX Listing Rules Appendix D2, using historical cost, with accounting policies consistent with the prospectus - The basis of preparation follows International Accounting Standard 34 issued by the International Accounting Standards Board and Appendix D2 of the Listing Rules[12] - The initial adoption of amendments to International Accounting Standard 21 "Lack of Exchangeability" has no significant impact on the consolidated financial position and performance for the current and prior periods[14] - International Financial Reporting Standard 18 "Presentation and Disclosure in Financial Statements" will replace International Accounting Standard 1, introducing new presentation and disclosure requirements for the statement of profit or loss and future financial statements[15] Operating Segment Information The company's main operating segments are refrigeration and automotive components, with H1 2025 revenues of RMB 10.38 billion and RMB 5.87 billion respectively - The chief operating decision-maker assesses the performance of each operating segment based on segment revenue and gross profit[17] 2025 H1 Segment Revenue | Segment | Revenue (RMB thousand) | | :--- | :--- | | Refrigeration and Air Conditioning Components | 10,382,763 | | Automotive Components | 5,871,026 | 2025 H1 Contract Revenue by Region | Region | Revenue (RMB thousand) | | :--- | :--- | | Mainland China | 9,051,921 | | Other Countries or Regions | 7,210,866 | - The increase in contract liabilities is mainly due to cash received before satisfying performance obligations, while the decrease is mainly due to revenue recognized after satisfying performance obligations[24] - The unfulfilled performance obligations of RMB 64,221 thousand as of June 30, 2025, are expected to be recognized as revenue within the next 12 months[25] Income Tax Expense Income tax expense for H1 2025 was RMB 398.377 million, primarily current income tax, with the company operating under various tax regimes globally Income Tax Expense Composition | Type | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Current income tax | 377,861 | 334,408 | | Deferred income tax | 20,516 | (2,112) | | Total | 398,377 | 332,296 | - Chinese high-tech enterprises enjoy a 15% preferential tax rate, and R&D expenses are eligible for a 200% super deduction[27] - US subsidiaries are subject to state tax rates ranging from 0% to 10% and a federal tax rate of 21%[28] - The Group expects to benefit from the transitional country-by-country reporting safe harbor in all Pillar Two jurisdictions enacted in 2024, incurring no additional tax[31] Dividends The company declared and paid a final dividend of RMB 932.42 million for the previous year, and proposed an interim dividend of RMB 1.20 per 10 ordinary shares for H1 2025 Declared and Paid Dividends | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Final dividend declared and paid for the previous year during the period | 932,420 | 926,626 | - On August 28, 2025, the Board proposed an interim dividend of RMB 1.20 per 10 ordinary shares (tax inclusive) for the six months ended June 30, 2025, compared to RMB 1.00 for the same period in 2024[32] Earnings Per Share Basic and diluted earnings per share for H1 2025 were RMB 0.57, an increase from RMB 0.40 in the prior period, driven by higher profit attributable to ordinary shareholders Basic Earnings Per Share | Indicator | 2025 (RMB thousand/share) | 2024 (RMB thousand/share) | | :--- | :--- | :--- | | Profit attributable to ordinary shareholders of the Company used to calculate basic earnings per share | 2,102,085 | 1,511,458 | | Weighted average number of ordinary shares issued (thousand shares) | 3,717,672 | 3,746,287 | | Basic earnings per share (RMB) | 0.57 | 0.40 | Diluted Earnings Per Share | Indicator | 2025 (RMB thousand/share) | 2024 (RMB thousand/share) | | :--- | :--- | :--- | | Adjusted profit attributable to owners of the Company used to calculate diluted earnings per share | 2,109,940 | 1,514,515 | | Weighted average number of ordinary shares used to calculate diluted earnings per share (thousand shares) | 3,733,170 | 3,746,287 | | Diluted earnings per share (RMB) | 0.57 | 0.40 | Property, Plant and Equipment Total property, plant and equipment increased to RMB 13.08 billion as of June 30, 2025, primarily due to additions in machinery and equipment and buildings Property, Plant and Equipment Composition | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Buildings | 4,151,397 | 4,086,238 | | Machinery and equipment | 6,198,759 | 5,540,560 | | Construction in progress | 2,044,147 | 2,171,985 | | Total | 13,081,817 | 12,274,558 | - For the six months ended June 30, 2025, additions to property, plant and equipment amounted to RMB 1,290,134 thousand[35] Depreciation and Amortization | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Cost of sales | 398,297 | 262,024 | | General and administrative expenses | 80,207 | 75,464 | | Research and development expenses | 26,178 | 18,304 | | Total | 505,679 | 356,106 | Trade and Bills Receivables Total trade and bills receivables significantly increased to RMB 12.21 billion as of June 30, 2025, with most trade receivables due within one year Trade and Bills Receivables | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Bills receivables | 2,999,421 | 2,685,890 | | Trade receivables | 9,723,003 | 7,317,720 | | Less: Provision for credit losses | (510,217) | (375,273) | | Total | 12,212,207 | 9,628,337 | Ageing Analysis of Trade Receivables | Ageing | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Within 1 year | 9,696,087 | 7,281,933 | | 1 to 2 years | 20,994 | 26,881 | | 2 to 3 years | 3,584 | 8,523 | | Over 3 years | 2,338 | 383 | - As of June 30, 2025, bills receivables of RMB 1,187,899 thousand were pledged for bank acceptance bills[37] Borrowings Total borrowings were RMB 4.28 billion as of June 30, 2025, with a significant portion being short-term, and interest rates ranging from 1.95% to 5.17% Borrowings Composition | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Secured bank loans | 1,068,385 | 918,745 | | Unsecured bank loans | 3,205,000 | 3,174,000 | | Less: Current portion of long-term borrowings | (1,068,026) | (500,420) | | Less: Short-term borrowings | (1,704,685) | (1,553,346) | | Total long-term borrowings | 1,509,000 | 2,045,773 | Borrowings Repayment Schedule | Term | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Within one year | 2,772,711 | 2,053,766 | | One to two years | 1,394,000 | 1,396,236 | | Two to five years | 115,000 | 649,537 | | Total | 4,281,711 | 4,099,539 | - Short-term borrowings carry annual interest rates ranging from 2.11% to 5.17%, while long-term borrowings range from 1.95% to 2.80%[38] Trade and Bills Payables Total trade and bills payables amounted to RMB 10.03 billion as of June 30, 2025, with the majority of trade payables due within one year Trade and Bills Payables Composition | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Trade payables | 5,995,838 | 5,985,427 | | Bills payables | 4,034,843 | 3,791,835 | | Total | 10,030,681 | 9,777,262 | Ageing Analysis of Trade Payables | Ageing | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Within one year | 5,788,640 | 5,879,227 | | Over one year | 207,198 | 106,200 | Principal Businesses During the Reporting Period The company focuses on R&D and application of thermal management technology, covering refrigeration, automotive components, and emerging fields like bionic robot actuators, holding leading global market positions - The company's core strategy revolves around heat pump technology and thermal management systems, providing environmental thermal management solutions for efficient heat exchange and intelligent temperature control[43] - Its businesses span two major segments: refrigeration and air conditioning components, and automotive components, with expansion into emerging fields such as bionic robot electromechanical actuators[43] Overview of Principal Businesses The company's principal businesses include refrigeration and automotive components, and strategic emerging industries like bionic robot actuators, providing comprehensive thermal management solutions - The refrigeration and air conditioning components business is a key global supplier for household/commercial air conditioning, refrigeration, and small appliance markets, offering products like electronic expansion valves, four-way reversing valves, and micro-channel heat exchangers[43] - The automotive components business is a pioneer in the new energy vehicle thermal management market, providing integrated thermal management control solutions, including automotive valves, pumps, heat exchangers, and integrated assemblies[43][44] - In strategic emerging industries, the company has successfully entered the bionic robot electromechanical actuator manufacturing field, leveraging its motor manufacturing expertise and cost control capabilities[44] Key Performance Drivers Performance is driven by global low-carbon policies, extreme weather, EV growth, and AI advancements, boosting demand for refrigeration, automotive thermal management, and bionic robot actuators - Drivers for the refrigeration and air conditioning components industry include global low-carbon energy-saving policies, expanding overseas market demand, surging air conditioning demand due to extreme weather, and rapid growth in cold chain logistics and data center industries[45][46] - Drivers for the automotive components industry include global automotive decarbonization targets, advancements in new energy vehicle technology, high-voltage fast charging and battery technology driving demand for efficient thermal management systems, and the integrated and modular development of automotive thermal management technology[46] - Drivers for strategic emerging industries (bionic robot electromechanical actuators) include an aging population, rising labor costs, Chinese government policy support, and advancements in artificial intelligence and sensing technologies[46][47] Industry Position The company is the world's largest manufacturer of refrigeration control components and a leading automotive thermal management system supplier, with many products ranking first globally - The company is the world's largest manufacturer of refrigeration control components and a global leader in automotive thermal management system components[48] - In refrigeration and air conditioning components, products such as four-way reversing valves, electronic expansion valves, and micro-channel heat exchangers rank first in the global market[48] - In automotive components, products like automotive electronic expansion valves and integrated assemblies rank first in the global market[48] Core Competitiveness Analysis The company's core competitiveness stems from strong R&D, lean manufacturing, comprehensive quality management, global presence, long-term client partnerships, and an experienced management team - The company possesses six R&D centers and 4,387 domestic and international patents, including 2,404 invention patents, demonstrating strong R&D capabilities and rapid product iteration and upgrade abilities[50] - It has established 8 production bases globally, achieving cost advantages and quick response to local customer needs through economies of scale and global layout[51] - The company has implemented comprehensive quality standards and control systems, obtaining international certifications such as ISO 9001 and IATF 16949, ensuring high product quality[53] - Its products are sold in over 80 countries and regions worldwide, with strategic partnerships with international renowned companies like Daikin, Ford, and Volkswagen, and overseas production bases in Mexico, Poland, Vietnam, and Thailand[55] - Long-term cooperative relationships have been established with industry-leading clients such as Carrier, Gree, Midea, Mercedes-Benz, BMW, and BYD, becoming the exclusive supplier of thermal management products for multiple automotive platforms[56] - The management team is deeply knowledgeable in the thermal management industry, possessing rich industry expertise, clear market insights, and strong management capabilities[57] Principal Business Analysis In H1 2025, revenue grew 18.9% to RMB 16.26 billion and net profit attributable to owners rose 39.3% to RMB 2.11 billion, with both refrigeration and automotive segments contributing to growth - The company's operating revenue reached RMB 16.26 billion, a year-on-year increase of 18.9%; net profit attributable to owners of the Company was RMB 2.11 billion, a year-on-year increase of 39.3%[58] Principal Business Revenue Growth | Business Segment | 2025 H1 Revenue (RMB million) | Year-on-Year Growth Rate | | :--- | :--- | :--- | | Refrigeration and Air Conditioning Components | 10,388.7 | 25.5% | | Automotive Components | 5,874.1 | 8.8% | - The refrigeration and air conditioning components business steadily increased its market share by adjusting market strategies, strengthening overseas presence, enhancing market share of leading products, and implementing cost reduction and efficiency improvement measures[59] - The automotive components business focused on intensive cultivation, promoting internal cost reduction and efficiency improvement, organizational optimization, enhancing self-R&D capabilities, and actively applying digital intelligence and AI tools to boost efficiency[59] - The strategic emerging business (bionic robot electromechanical actuators) focused on technical improvements for key product models, collaborating with clients on full-series product R&D, trial production, iteration, and sampling, achieving overall product capability enhancement[59] Outlook and Strategies The company adheres to a 'focus on leadership, innovate beyond' strategy, centering on heat pump and thermal management systems, aiming to transition to 'technology leadership' and become a global leader in climate intelligent control systems - The company's development strategy is "focus on leadership, innovate beyond," with R&D and application of heat pump technology and thermal management system products at its core[60] - The strategic transformation aims to shift from "cost leadership" to "technology leadership" and upgrade from "mechanical component development" to "electronic control integrated system control technology solution development"[60] 2025 Operating Plan For 2025, the company plans to strengthen product capabilities, expand global capacity, and develop data center business in refrigeration, while focusing on technology and client collaboration in automotive, and R&D in bionic robotics - The refrigeration and air conditioning components business plans to strengthen product capabilities, expand business scale, seize the three elements of "cost, efficiency, and quality," and proactively deploy global manufacturing base capacity coordination plans[61] - The automotive components business plans to build product capabilities for integrated assemblies, valves, pumps, and heat exchangers based on general technology development, and strengthen cooperation with strategic clients[62] - The bionic robot business plans to focus on R&D, trial production, iteration, and sampling of electromechanical actuators, increase efforts in key component development, and actively expand overseas production and R&D teams[62] Financial Review The group achieved significant revenue and profit growth, driven by increased sales in refrigeration and automotive components and effective cost control, maintaining a robust financial position and ample liquidity - The Group's revenue increased by 18.9% compared to H1 2024, and profit attributable to owners of the Company increased by 39.3%, primarily driven by sales growth and effective cost control[63] - Non-current assets increased mainly due to additions to property, plant, and equipment; current assets increased mainly due to higher cash and cash equivalents and trade and bills receivables, with the increase in cash attributable to H-share issuance proceeds[80] - The gearing ratio decreased from 21.0% as of December 31, 2024, to 14.6% as of June 30, 2025, primarily due to the inflow of funds from the H-share listing[85] Revenue Total revenue increased by 18.9% to RMB 16.26 billion, with refrigeration components growing 25.5% and automotive components 8.8%, driven by higher sales and market demand Revenue by Product Category | Product Category | June 30, 2025 (RMB thousand) | % of Total | June 30, 2024 (RMB thousand) | % of Total | | :--- | :--- | :--- | :--- | :--- | | Refrigeration and Air Conditioning Components | 10,388,693 | 63.9 | 8,278,700 | 60.5 | | Automotive Components | 5,874,094 | 36.1 | 5,397,372 | 39.5 | | Total | 16,262,787 | 100.0 | 13,676,072 | 100.0 | - Revenue from refrigeration and air conditioning components increased by 25.5%, mainly due to low energy consumption policies, "trade-in" policies for home appliances, and product upgrades in air conditioning[66] - Revenue from automotive components increased by 8.8%, mainly due to strong performance in the new energy vehicle market and increased demand for thermal management systems[67] Revenue by Sales Region | Sales Region | June 30, 2025 (RMB thousand) | % of Total | June 30, 2024 (RMB thousand) | % of Total | | :--- | :--- | :--- | :--- | :--- | | Mainland China | 9,051,921 | 55.7 | 7,826,338 | 57.2 | | Other Countries or Regions | 7,210,866 | 44.3 | 5,849,734 | 42.8 | | Total | 16,262,787 | 100.0 | 13,676,072 | 100.0 | Cost of Sales Cost of sales increased in line with revenue growth, with both refrigeration and automotive component segments experiencing higher costs - For the six months ended June 30, 2025, the Group's cost of sales increased in line with revenue growth[69] Cost of Sales by Product Category | Product Category | June 30, 2025 (RMB thousand) | % of Total | June 30, 2024 (RMB thousand) | % of Total | | :--- | :--- | :--- | :--- | :--- | | Refrigeration and Air Conditioning Components | 7,461,833 | 63.6 | 6,033,836 | 60.6 | | Automotive Components | 4,278,804 | 36.4 | 3,929,468 | 39.4 | | Total | 11,740,637 | 100.0 | 9,963,304 | 100.0 | Gross Profit and Gross Margin Gross margin remained stable at 27.8%, a 0.7% increase from the prior period, with refrigeration components contributing the majority of gross profit - The Group's gross margin was 27.8%, an increase of 0.7% from 27.1% in the prior period, indicating stable gross margin[71] Gross Profit by Product Category | Product Category | June 30, 2025 (RMB thousand) | % of Total | June 30, 2024 (RMB thousand) | % of Total | | :--- | :--- | :--- | :--- | :--- | | Refrigeration and Air Conditioning Components | 2,926,860 | 64.7 | 2,244,864 | 60.5 | | Automotive Components | 1,595,290 | 35.3 | 1,467,904 | 39.5 | | Total | 4,522,150 | 100.0 | 3,712,768 | 100.0 | General and Administrative Expenses General and administrative expenses increased by 2.8% to RMB 1.002 billion, primarily due to higher staff costs from business expansion General and Administrative Expenses | Indicator | 2025 (RMB million) | 2024 (RMB million) | Growth Rate | | :--- | :--- | :--- | :--- | | General and administrative expenses | 1,002.2 | 975.2 | 2.8% | - The increase was primarily due to higher staff costs for administrative personnel as the company's business expanded during the reporting period[73] Selling and Marketing Expenses Selling and marketing expenses rose by 3.7% to RMB 308.1 million, mainly attributable to increased share-based compensation for sales personnel Selling and Marketing Expenses | Indicator | 2025 (RMB million) | 2024 (RMB million) | Growth Rate | | :--- | :--- | :--- | :--- | | Selling and marketing expenses | 308.1 | 297.0 | 3.7% | - The increase was primarily due to higher share-based compensation for sales personnel during the reporting period[74] Research and Development Expenses R&D expenses increased by 11.4% to RMB 705.0 million, representing 4.3% of revenue, primarily due to higher staff costs for R&D personnel Research and Development Expenses | Indicator | 2025 (RMB million) | 2024 (RMB million) | Growth Rate | | :--- | :--- | :--- | :--- | | Research and development expenses | 705.0 | 632.6 | 11.4% | - R&D expenses accounted for 4.3% of the Group's revenue for the six months ended June 30, 2025[75] - The increase was primarily due to higher staff costs for R&D personnel during the reporting period[75] Net Impairment Loss on Financial Assets Net impairment loss on financial assets increased by 68.0% to RMB 129.0 million, mainly due to a higher increase in trade receivables driven by sales growth Net Impairment Loss on Financial Assets | Indicator | 2025 (RMB million) | 2024 (RMB million) | Growth Rate | | :--- | :--- | :--- | :--- | | Net impairment loss on financial assets | 129.0 | 76.8 | 68.0% | - The increase was primarily due to sales revenue growth during the reporting period, leading to a higher increase in trade receivables at the end of the period compared to the prior period[76] Other Income Other income increased by RMB 12.8 million to RMB 178.5 million, primarily due to higher VAT super deduction Other Income | Indicator | 2025 (RMB million) | 2024 (RMB million) | Change (RMB million) | | :--- | :--- | :--- | :--- | | Other income | 178.5 | 165.7 | 12.8 | - The increase was primarily due to higher VAT super deduction during the reporting period[77] Other Gains/(Losses) - Net The group recorded net other gains of RMB 23.9 million, a positive shift from a net loss of RMB 10.0 million in the prior period, mainly due to fair value changes in derivative financial instruments Other Gains/(Losses) - Net | Indicator | 2025 (RMB million) | 2024 (RMB million) | | :--- | :--- | :--- | | Other gains/(losses) - net | 23.9 | (10.0) | - The year-on-year change was primarily due to fair value changes in derivative financial instruments during the reporting period[78] Income Tax Expense (Financial Review) Income tax expense increased by RMB 66.1 million to RMB 398.4 million, primarily driven by higher profit before tax Income Tax Expense | Indicator | 2025 (RMB million) | 2024 (RMB million) | Change (RMB million) | | :--- | :--- | :--- | :--- | | Income tax expense | 398.4 | 332.3 | 66.1 | - The increase was primarily driven by higher profit before tax during the reporting period[79] Financial Position Both non-current and current assets increased, with current assets significantly boosted by H-share issuance proceeds, leading to substantial growth in net current assets and net assets - Non-current assets increased by RMB 827.4 million to RMB 14.88 billion, primarily due to an increase in property, plant, and equipment[80] - Current assets increased by RMB 9.20 billion to RMB 31.50 billion, mainly due to increases in cash and cash equivalents and trade and bills receivables, with the increase in cash attributable to H-share issuance proceeds[80] - Non-current liabilities decreased by RMB 516.7 million to RMB 2.69 billion, primarily due to the reclassification of some long-term borrowings to current liabilities[80] - Current liabilities increased by RMB 752.7 million to RMB 14.39 billion, mainly due to increases in trade and bills payables and borrowings due within one year[81] Net Current Assets and Cash and Cash Equivalents | Indicator | June 30, 2025 (RMB million) | December 31, 2024 (RMB million) | | :--- | :--- | :--- | | Net current assets | 17,115.7 | 8,667.9 | | Net assets | 29,311.7 | 19,519.6 | | Cash and cash equivalents | 11,329.5 | 3,443.5 | Liquidity and Financial Resources Operating cash inflow increased by RMB 161.6 million to RMB 1.20 billion, driven by expanded revenue and improved sales collection, ensuring ample liquidity for daily operations Operating Cash Inflow | Indicator | 2025 (RMB million) | 2024 (RMB million) | Change (RMB million) | | :--- | :--- | :--- | :--- | | Operating cash inflow | 1,202.5 | 1,040.9 | 161.6 | - Bank and cash balances (including pledged and restricted bank deposits) were approximately RMB 13.20 billion, a significant increase from RMB 5.25 billion at the end of 2024[82] - Total borrowings were approximately RMB 4.28 billion, of which approximately RMB 2.77 billion is repayable within one year[82] Capital Structure Borrowings are primarily RMB-denominated, while cash is held in multiple currencies; the gearing ratio decreased to 14.6% due to H-share IPO proceeds, enhancing financial stability - The Group's borrowings are primarily denominated in RMB, while cash and cash equivalents are mainly held in RMB, Euro, USD, and HKD[84] - Approximately 49.8% of outstanding loans bear fixed interest rates, with the remainder bearing floating interest rates[84] Gearing Ratio | Indicator | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Gearing ratio | 14.6% | 21.0% | - The decrease in the gearing ratio was primarily due to the inflow of funds from the company's H-share listing, maintaining financial stability[85] Capital Expenditure Capital expenditure decreased by RMB 120.1 million to RMB 1.48 billion, primarily for property, land, equipment, and intangible assets, funded by operating cash flow, bank loans, and share issuance Capital Expenditure | Indicator | 2025 (RMB million) | 2024 (RMB million) | Change (RMB million) | | :--- | :--- | :--- | :--- | | Capital expenditure | 1,475.9 | 1,596.0 | (120.1) | - Capital expenditure primarily includes expenses incurred for the purchase of property, land, and equipment (including right-of-use assets) and intangible assets[86] - Funding sources include cash flow from operating activities, bank borrowings, and proceeds from share issuance[86] Capital Commitments Contractual commitments decreased to RMB 1.00 billion for factory and R&D center construction, while authorized but uncontracted commitments increased to RMB 5.62 billion for automotive component factories Capital Commitments | Type | June 30, 2025 (RMB million) | December 31, 2024 (RMB million) | | :--- | :--- | :--- | | Contractual commitments | 1,004.3 | 1,525.9 | | Authorized but uncontracted commitments | 5,622.4 | 5,458.0 | - The decrease in contractual commitments primarily reflects the company's ongoing construction of production factories and R&D centers in Zhongshan, Hangzhou, and overseas locations[87] - The increase in authorized but uncontracted commitments primarily reflects the company's planned construction of automotive component (especially new energy vehicle) production factories in Shaoxing, Zhongshan, and Mexico[87] Pledge of Assets As of June 30, 2025, assets with a carrying value of RMB 1.18 billion, mainly bills receivables, were pledged to secure bank loans and other credit facilities - As of June 30, 2025, the Group had assets with a total carrying value of RMB 1,179.0 million pledged to secure bank loans and other bank credit facilities[88] - These assets primarily include bills receivables of RMB 1,179.0 million pledged for daily payment of goods[88] Foreign Exchange Risk The company faces significant foreign exchange risk due to substantial Euro and USD denominated transactions and employs various hedging strategies, including timely settlement and forward contracts - The company's production bases and sales markets are distributed across major developed and developing countries and regions, with a significant proportion of business settled in Euro and USD, exposing it to considerable foreign exchange risk89 - The company manages foreign exchange risk through measures such as timely or delayed settlement based on exchange rate trend forecasts, overseas financing via domestic guarantees to hedge foreign currency monetary assets, and engaging in forward foreign exchange and currency swap transactions89 Contingent Liabilities As of June 30, 2025, the group had no significant contingent liabilities - As of June 30, 2025, the Group had no significant contingent liabilities[90] Material Investments Held As of June 30, 2025, the group held no material investments, defined as 5% or more of total assets in an investee company - As of June 30, 2025, the Group held no material investments (investment amount accounting for 5% or more of the Group's total assets)[91] Material Acquisitions and Disposals of Subsidiaries, Associates and Joint Ventures For the six months ended June 30, 2025, the group did not undertake any material acquisitions or disposals of subsidiaries, associates, or joint ventures - For the six months ended June 30, 2025, the Group did not undertake any material acquisitions or disposals of subsidiaries, associates, or joint ventures[92] Future Plans for Material Investments or Acquisitions of Capital Assets and Expected Funding Sources As of June 30, 2025, the group had no other significant plans for material investments or acquisitions of capital assets - As of June 30, 2025, the Group had no other significant plans for material investments or acquisitions of capital assets[93] Other Information This section covers employment, corporate governance, securities trading, share repurchases, use of proceeds, interim dividends, audit committee review, and post-reporting period events - The Group accrued total staff remuneration and benefits of RMB 2.16 billion and is committed to building a multi-level, multi-series talent development system94 - The company complies with the Corporate Governance Code, although the roles of Chairman and CEO are combined by Mr. Zhang Yabo, an arrangement the Board believes ensures consistent internal leadership and efficient decision-making9596 - The company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix C3 of the Listing Rules and confirms that directors and supervisors have fully complied with it97 Purchase, Sale or Redemption of the Company's Listed Securities The company approved an A-share repurchase plan in December 2024, with a maximum price of RMB 35.75/share and total funds between RMB 30 million and RMB 60 million, having repurchased 1,506,800 A-shares by June 30, 2025 - The company approved an A-share repurchase plan on December 30, 2024, with the repurchase price cap adjusted to RMB 35.75/share and total repurchase funds not less than RMB 30 million and not exceeding RMB 60 million99 - As of June 30, 2025, the company held a total of 2,707,721 treasury A-shares99 A-share Repurchase Status | Repurchase Month | Repurchased Quantity (shares) | Lowest Transaction Price per Share (RMB) | Highest Transaction Price per Share (RMB) | Total Funds (excluding transaction fees, RMB) | | :--- | :--- | :--- | :--- | :--- | | March 2025 | 191,300 | 30.13 | 31.00 | 5,811,903.86 | | April 2025 | 1,315,500 | 22.69 | 31.00 | 30,159,622.00 | | Total | 1,506,800 | - | - | 35,971,525.86 | Use of Proceeds Net proceeds from H-share IPO (HKD 10.58 billion) are allocated to global R&D, factory expansion, overseas capacity, digital infrastructure, and working capital, while A-share convertible bond proceeds (RMB 2.99 billion) fund commercial refrigeration and energy-efficient component projects - The net proceeds from the H-share listing (after exercising the over-allotment option) are approximately HKD 10.58 billion103 Planned Use of H-share IPO Net Proceeds (as of July 23, 2025, after exercising over-allotment option) | Project | Percentage of Net Proceeds | Planned Net Proceeds (HKD million) | | :--- | :--- | :--- | | Continuous global R&D and innovation of product portfolio | 30% | 3,174.6 | | Expansion and new construction of factories in China and enhancement of production automation | 30% | 3,174.6 | | Expansion of overseas production capacity and deepening of global layout | 25% | 2,645.5 | | Strengthening digital intelligent infrastructure | 5% | 529.1 | | Working capital and general corporate purposes | 10% | 1,058.2 | | Total | 100% | 10,582.0 | - The net proceeds from the A-share convertible bonds amounted to RMB 2.99 billion104 Use of A-share Convertible Bond Proceeds (as of June 30, 2025) | Project | Total Planned Use (RMB million) | Amount Used as of June 30, 2025 (RMB million) | Balance as of June 30, 2025 (RMB million) | | :--- | :--- | :--- | :--- | | Annual production of 65 million sets of commercial refrigeration and air conditioning intelligent control components construction project | 1,487.0 | 1,247.0 | 309.4 | | Annual production of 50.5 million sets of high-efficiency and energy-saving refrigeration and air conditioning control components technical transformation project | 698.0 | 454.1 | 301.3 | | Replenishment of working capital | 815.0 | 812.7 | - | | Total | 3,000.0 | 2,513.8 | 610.7 | Interim Dividend The proposed 2025 interim dividend is RMB 1.20 per 10 shares (tax inclusive), totaling approximately RMB 504.7 million, representing 23.9% of H1 2025 net profit attributable to owners, subject to shareholder approval - The company's 2025 interim profit distribution plan proposes a cash dividend of RMB 1.20 per 10 shares (tax inclusive)105 - The total cash dividend is estimated to be approximately RMB 504.7 million, representing 23.9% of the consolidated net profit attributable to owners of the parent company for H1 2025105 - The proposed interim dividend will be denominated and declared in RMB, payable in RMB to A-share shareholders and in HKD to H-share shareholders106 Events After Reporting Period Post-reporting period events include the full exercise of the over-allotment option for H-shares, repurchase and cancellation of restricted A-shares, and amendments to the company's articles of association - On July 18, 2025, the over-allotment option was fully exercised, resulting in the issuance of 62,156,900 H-shares and net proceeds of approximately HKD 1.39 billion108 - With shareholder approval, 912,000 A-shares of restricted stock, granted but not yet vested, held by incentive recipients who no longer met eligibility criteria, were repurchased and cancelled109 - The company's articles of association have been revised to reflect the total share capital increasing to 4,208,925,935 shares after the H-share listing, subsequently decreasing to 4,208,013,935 shares due to the repurchase and cancellation of restricted shares, along with changes in the business scope110