华星控股(08237) - 2025 - 中期财报

Company Information This section details the company's governance structure, including board composition and administrative contact information Board of Directors and Committee Composition The company's board comprises executive, non-executive, and independent non-executive directors, with changes in audit, remuneration, and nomination committee members and chairpersons effective January 6, 2025 - The Board of Directors includes Mr. He Dingding (CEO), Mr. Lu Tianshun (Executive Director), Mr. Zhao Gongzhi, Mr. Huang Junxiong (Chairman), Mr. Gao Zhaoyuan, Mr. Yuan Liqian (Non-Executive Directors), and Ms. Chen Huiqi, Mr. He Shengwei, Mr. Deng Zhaoming (Independent Non-Executive Directors)[4] - Changes in the Audit Committee, Remuneration Committee, and Nomination and Corporate Governance Committee members and chairpersons occurred on January 6, 2025, with Mr. Deng Zhaoming appointed as Audit Committee Chairman[4] Company Contact and Administrative Information The company is registered in the Cayman Islands with its principal place of business in Hong Kong, detailing share registrars, principal bankers, auditors, stock code, and website - The registered office is in the Cayman Islands, with the head office and principal place of business in Hong Kong[5] - The Hong Kong share registrar is Tricor Investor Services Limited, and the principal banker is DBS Bank Limited[5] - The company's stock code is 8237, and its website is www.irasia.com/listco/hk/linkholdings[5](index=5&type=chunk) Financial Highlights This section provides a summary of the company's key financial performance indicators Overview of Operating Results For the six months ended June 30, 2025, the Group's hotel operating revenue significantly decreased by 38.4% year-on-year, leading to a 21.5% increase in loss attributable to owners of the company and an expanded basic loss per share 2025 Half-Year Operating Results Overview | Indicator | 2025 (HK$ thousand) | 2024 (HK$ thousand) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Hotel operating revenue | 13,590 | 22,067 | -38.4% | | Loss attributable to owners of the company | (42,206) | (34,736) | +21.5% | | Basic loss per share (HK cents) | (24.86) | (20.74) | +20.06% | Condensed Consolidated Statement of Comprehensive Income This section presents the Group's financial performance, including revenue, expenses, and total comprehensive expense Profit and Loss Performance The Group experienced a significant decline in revenue and gross profit in the first half of 2025, coupled with increased administrative expenses and finance costs, resulting in an expanded loss for the period and higher total comprehensive expense Condensed Consolidated Statement of Comprehensive Income Key Data | Indicator | 2025 (HK$ thousand) | 2024 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 13,590 | 22,067 | -38.42% | | Cost of sales | (11,739) | (11,316) | +3.74% | | Gross profit | 1,851 | 10,751 | -82.78% | | Administrative expenses | (21,480) | (18,761) | +14.49% | | Finance costs | (21,470) | (25,087) | -14.38% | | Loss before income tax | (41,192) | (33,267) | +23.82% | | Loss for the period | (42,226) | (34,799) | +21.34% | | Exchange differences on translation of foreign operations | (20,856) | (13,496) | +54.53% | | Total comprehensive expense for the period | (63,082) | (48,295) | +30.62% | Loss for the Period and Total Comprehensive Expense Attributable To | Attributable To | 2025 Loss for the Period (HK$ thousand) | 2024 Loss for the Period (HK$ thousand) | 2025 Total Comprehensive Expense (HK$ thousand) | 2024 Total Comprehensive Expense (HK$ thousand) | | :--- | :--- | :--- | :--- | :--- | | Owners of the Company | (42,206) | (34,736) | (63,031) | (48,154) | | Non-controlling interests | (20) | (63) | (51) | (141) | | Total | (42,226) | (34,799) | (63,082) | (48,295) | Loss Per Share | Indicator | 2025 (HK cents) | 2024 (HK cents) | | :--- | :--- | :--- | | Basic loss per share | (24.86) | (20.74) | | Diluted loss per share | (24.86) | (20.74) | Condensed Consolidated Statement of Financial Position This section outlines the Group's financial position, including assets, liabilities, and equity Assets and Liabilities Position As of June 30, 2025, the Group's non-current assets increased, but current assets decreased, and current liabilities significantly rose, leading to a substantial expansion in net current liabilities and total deficit Condensed Consolidated Statement of Financial Position Key Data | Indicator | June 30, 2025 (HK$ thousand) | December 31, 2024 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Total non-current assets | 480,809 | 457,304 | +5.14% | | Total current assets | 29,973 | 39,226 | -23.60% | | Total current liabilities | 609,836 | 538,826 | +13.18% | | Net current liabilities | (579,863) | (499,600) | +16.07% | | Total assets less current liabilities | (99,054) | (42,296) | +134.22% | | Total non-current liabilities | 41,371 | 38,988 | +6.11% | | Net liabilities | (140,425) | (81,284) | +72.77% | | Total deficit | (140,425) | (81,284) | +72.77% | Condensed Consolidated Statement of Changes in Equity This section details the changes in the Group's equity over the reporting period Analysis of Changes in Equity The Group's total equity deficit expanded from HK$81,284 thousand at the beginning of 2025 to HK$140,425 thousand at period-end, primarily due to the loss for the period and negative exchange differences from foreign operations, partially offset by shares issued from a placing event Key Data on Changes in Equity | Indicator | January 1, 2025 (HK$ thousand) | June 30, 2025 (HK$ thousand) | Change (HK$ thousand) | | :--- | :--- | :--- | :--- | | Share capital | 4,188 | 5,026 | +838 | | Share premium | 363,352 | 366,455 | +3,103 | | Translation reserve | (84,951) | (105,776) | -20,825 | | Accumulated losses | (437,178) | (478,735) | -41,557 | | Equity attributable to owners of the Company | (78,270) | (137,360) | -59,090 | | Total deficit | (81,284) | (140,425) | -59,141 | - The loss for the period was HK$42,206 thousand, and exchange differences on translation of foreign operations were HK$20,825 thousand, resulting in a total comprehensive expense of HK$63,031 thousand[12] - Net proceeds of HK$3,941 thousand from the issue of shares for the placing event increased share capital and share premium[12] Condensed Consolidated Statement of Cash Flows This section presents the Group's cash inflows and outflows from operating, investing, and financing activities Cash Flow Analysis In the first half of 2025, the Group experienced significant cash outflows from operating activities, and despite some cash inflows from financing activities, overall cash and cash equivalents substantially decreased Condensed Consolidated Statement of Cash Flows Key Data | Indicator | 2025 (HK$ thousand) | 2024 (HK$ thousand) | Change (HK$ thousand) | | :--- | :--- | :--- | :--- | | Net cash used in operating activities | (22,258) | (20,686) | -1,572 | | Net cash used in investing activities | (10) | (540) | +530 | | Net cash from financing activities | 7,468 | 18,505 | -11,037 | | Net decrease in cash and cash equivalents | (14,800) | (2,721) | -12,079 | | Cash and cash equivalents at end of period | 5,825 | 22,400 | -16,575 | Notes to the Condensed Consolidated Interim Financial Statements This section provides detailed explanations and disclosures supporting the condensed consolidated interim financial statements Company Information The company is incorporated in the Cayman Islands, primarily engaged in investment holding, with its subsidiaries involved in hotel services, non-performing debt asset management, and property investment - The Company was incorporated as an exempted company in the Cayman Islands on May 15, 2012[15] - Its principal business is investment holding, with subsidiaries primarily engaged in hotel ownership, hotel services, non-performing debt asset management, and property investment[15] Basis of Preparation and Principal Accounting Policies The interim financial statements are prepared in accordance with International Financial Reporting Standards and GEM Listing Rules, using the same accounting policies as the 2024 audited consolidated financial statements, with no significant impact from newly adopted standards - The interim financial statements have been prepared in accordance with International Financial Reporting Standards issued by the International Accounting Standards Board and the applicable disclosure requirements of the GEM Listing Rules[16] - The accounting policies and methods of computation used in the preparation of the interim financial statements are the same as those adopted in the 2024 audited consolidated financial statements[16] - The Group has adopted all new and revised standards, but they have no significant impact on accounting policies and reported amounts[17] Income and Loss from Non-Performing Debt Assets at Amortized Cost The Group's revenue primarily stems from hotel operations, with hotel room revenue being the largest component but significantly declining, while no loss was recorded from non-performing debt assets this period Hotel Operating Revenue Analysis | Revenue Category | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Hotel room | 8,756 | 16,117 | | Food and beverage | 2,696 | 3,213 | | Rental income from hotel properties | 1,465 | 2,364 | | Others | 673 | 373 | | Total | 13,590 | 22,067 | Hotel Business Revenue by Geographical Segment | Principal Geographical Market | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Singapore | 8,937 | 15,967 | | Japan | 4,653 | 6,100 | | Total | 13,590 | 22,067 | - For non-performing debt assets, no impairment loss was recorded in 2025, compared to HK$19 thousand in 2024[18] Loss Before Income Tax Expense Key factors contributing to the loss before income tax expense include staff costs, depreciation of property, plant and equipment, depreciation of right-of-use assets, and Singapore property tax Components of Loss Before Income Tax Expense | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Staff costs | 6,189 | 6,365 | | Depreciation of property, plant and equipment | 5,584 | 4,767 | | Depreciation of right-of-use assets | 1,298 | 1,292 | | Singapore property tax | 962 | 1,668 | Income Tax Expense The Group's income tax expense primarily originates from Singapore, taxed at 17%, while entities in other regions are subject to local tax rates or corporate income tax exemptions Income Tax Expense Components for the Period | Tax Category | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Singapore corporate income tax | 1,034 | 1,532 | - The Group incurred no assessable profits in Hong Kong, thus no Hong Kong profits tax provision was made[21] - Entities in the Cayman Islands and British Virgin Islands are exempt from corporate income tax; Indonesian subsidiaries are subject to a 25% income tax rate; Chinese subsidiaries are subject to a 25% corporate income tax rate; Japanese subsidiaries are subject to an effective statutory income tax rate of approximately 33.59% for Japanese profits tax[22] Loss Per Share Both basic and diluted loss per share attributable to owners of the company were 24.86 HK cents, an increase from the prior year, with potential dilutive ordinary shares having an anti-dilutive effect on basic loss per share Loss Per Share Calculation Data | Indicator | 2025 (HK$ thousand/thousand shares) | 2024 (HK$ thousand/thousand shares) | | :--- | :--- | :--- | | Loss used for basic and diluted loss per share | (42,206) | (34,736) | | Weighted average number of ordinary shares for basic loss per share | 169,741 | 167,520 | | Weighted average number of ordinary shares for diluted loss per share | 169,741 | 167,520 | - For the six months ended June 30, 2025 and 2024, the diluted loss per share was the same as the basic loss per share, due to the anti-dilutive effect of potential dilutive ordinary shares on basic loss per share[25] Dividends The Board of Directors does not recommend the payment of any dividends for the six months ended June 30, 2025 - The Directors do not recommend the payment of any dividends for the six months ended June 30, 2025 (2024: nil)[26] Trade and Other Receivables The Group's trade receivables significantly decreased, with a typical credit period of 30 days, and strict control over uncollected amounts, posing no significant credit concentration risk Ageing Analysis of Trade Receivables | Ageing | June 30, 2025 (HK$ thousand) | December 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | Current to 30 days | 749 | 1,881 | | 31 to 60 days | 55 | 668 | | 61 to 90 days | – | 7 | | Over 90 days | 5 | 13 | | Total | 809 | 2,569 | - Trade receivables generally have a 30-day credit period and are recognized and recorded at their original invoice amounts less impairment[27] - The Group maintains strict control over uncollected receivables and has no significant credit concentration risk[27] Trade and Other Payables The Group's trade payables increased, typically enjoying a credit period of up to 30 days, while other payables include a substantial amount of construction payables Ageing Analysis of Trade Payables | Ageing | June 30, 2025 (HK$ thousand) | December 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | Current to 30 days | 1,118 | 473 | | 31 to 60 days | 220 | 246 | | 61 to 90 days | 124 | 146 | | Over 90 days | 95 | 92 | | Total | 1,557 | 957 | - The Group typically obtains a credit period of up to 30 days from its suppliers, and trade payables are interest-free[29] - Other payables include construction payables, with a current portion of approximately HK$42,118 thousand and a non-current portion of approximately HK$7,601 thousand[29] Management Discussion and Analysis This section provides an overview of the Group's business operations, financial performance, and future outlook Business Review The Group continues to focus on hotel operations in Singapore and Japan, but the Singapore Hotel G was impacted by expanded renovation works, the Japan Hanatsubaki Ryokan underperformed due to financial strain and earthquake damage, and the Bintan resort development remains suspended - The Group primarily operates Hotel G in Singapore and Hanatsubaki Ryokan in Japan, and commenced non-performing debt asset management business in 2017[30] - The scope of renovation and maintenance works at Hotel G Singapore expanded, further impacting its business, with completion expected by the end of 2025[30] - Hanatsubaki Ryokan in Japan underperformed due to financial and human resource constraints and earthquake damage in early 2024, prompting the Group to consider exploring options like disposal to alleviate liquidity pressure[30] - The development of the Bintan resort hotel in Indonesia has been suspended since the outbreak of the COVID-19 pandemic in early 2020, and the Group is considering seeking potential investors for capital injection[30] Financial Review The Group's total hotel operating revenue decreased by 38.4% year-on-year, leading to a 21.5% increase in loss attributable to owners of the company and an expanded basic loss per share, primarily due to a reduction in available rooms at Hotel G due to renovation - The Group's total hotel operating revenue was approximately HK$13,590 thousand (2024: approximately HK$22,067 thousand), a decrease of approximately 38.4% compared to the same period last year[31] - Loss attributable to owners of the company was approximately HK$42,206 thousand (2024: approximately HK$34,736 thousand), an increase in loss of approximately HK$7,470 thousand or approximately 21.5% compared to the same period last year[32] - The increase in loss was primarily due to the expanded scope of renovation and maintenance works at Hotel G, leading to a further reduction in the total number of available rooms and thus decreased revenue from the Singapore hotel business[32] - Basic loss per share was approximately 24.86 HK cents (2024: approximately 20.74 HK cents (restated))[32] Hotel Operations Room revenue accounted for 64.4% of total hotel operating revenue but declined due to Hotel G's renovation, which reduced total available room nights, average room rate, and revenue per available room, despite an increase in occupancy rate; food and beverage and rental income also decreased - Room revenue was approximately HK$8,756 thousand (2024: approximately HK$16,117 thousand), accounting for approximately 64.4% of the Group's total hotel operating revenue[33] Hotel G Operating Metrics | Indicator | 2025 | 2024 | | :--- | :--- | :--- | | Total available room nights | 16,290 | 26,754 | | Occupancy rate | 57% | 47% | | Average room rate (HK$) | 619.5 | 835.3 | | Revenue per available room (HK$) | 354.7 | 391.2 | - Food and beverage revenue was approximately HK$2,696 thousand (2024: approximately HK$3,213 thousand), accounting for approximately 19.8% of total hotel operating revenue[33] - Rental income from hotel tenants was approximately HK$1,465 thousand (2024: approximately HK$2,364 thousand), accounting for approximately 10.8% of total hotel business revenue[34] Bintan Assets The Bintan development plan has been delayed due to tightened financial resources and the COVID-19 pandemic, and the Group is considering seeking potential investors to complete or acquire the asset outright - The first phase of the Bintan development plan's construction contract was signed in September 2016, but project progress has been delayed since 2020 due to tightened financial resources and the COVID-19 pandemic[35] - The Group is currently considering seeking potential investors for capital injection to complete or acquire the Bintan assets outright[35] Non-Performing Debt Asset Management Business No loss was recorded from the non-performing debt asset management business during the period, and management found no issues regarding the ownership and recoverability of related assets - During the review period, the Group recorded no loss from non-performing debt assets (net of impairment loss) (2024: loss of approximately HK$19 thousand)[36] - As of the date of this interim report, management has not identified any issues regarding the ownership and recoverability of non-performing debt assets[36] Liquidity, Financial Resources, and Capital Structure The Group faces liquidity pressure with significantly increased net current liabilities and short-term interest-bearing borrowings; to address this, the Group completed a placing to raise funds for general working capital and is actively monitoring and managing its capital - As of June 30, 2025, the Group recorded net current liabilities of approximately HK$579,863 thousand (2024: approximately HK$499,600 thousand)[37] - Short-term interest-bearing bank and other borrowings amounted to approximately HK$489,076 thousand (2024: approximately HK$427,857 thousand)[37] - The Company completed a placing on June 18, 2025, issuing 33,504,000 shares with net proceeds of approximately HK$3,824 thousand, intended for the Group's general working capital[38][39] - The Board believes the placing is the best fundraising method to strengthen the financial position, provide working capital, broaden the shareholder base, and enhance the capital base, superior to debt financing, bank borrowings, rights issues, or open offers[40] Measures to Address Going Concern Issues To resolve going concern uncertainties, the Group is implementing several measures, including advancing Hotel G renovations, utilizing placing proceeds, actively seeking new financing, negotiating debt restructuring with existing lenders, and implementing cost control and asset disposals - The scope of renovation and maintenance works at Hotel G has expanded to include the annex building and main building, with completion expected by the end of 2025[42] - The placing was completed on June 18, 2025, with net proceeds of approximately HK$3,824 thousand, of which approximately HK$2,900 thousand has been used for the Group's general working capital[43] - The Group is committed to obtaining new financing sources at reasonable costs and actively negotiating with existing lenders for extensions, refinancing, or restructuring of existing borrowings, as well as reducing interest rates and/or deferring principal and interest payments[44] - The Group continues to seek suitable opportunities to dispose of its assets to increase cash inflow while implementing cost control measures to streamline administrative expenses[44] Material Investments During the review period, the Group did not acquire or hold any material investments - During the review period, the Group did not acquire or hold any material investments (2024: nil)[45] Material Acquisitions and Disposals During the review period, the Group had no material acquisitions or disposals of subsidiaries, associates, and joint ventures - During the review period, the Group had no material acquisitions or disposals of subsidiaries, associates, and joint ventures[46] Future Plans for Material Investments and Capital Assets As of the date of this interim report, the Group has no plans for material investments and capital assets other than those disclosed herein - Other than those disclosed in this report, as of the date of this interim report, the Group has no plans for material investments and capital assets[47] Gearing Ratio The gearing ratio is not applicable as the Group recorded a deficit attributable to owners of the company as of June 30, 2025 - As of June 30, 2025, the Group recorded total debt of approximately HK$546,056 thousand and a total deficit of approximately HK$140,425 thousand, making the gearing ratio not applicable (June 30, 2024: approximately 1,811.1%)[48] Contingent Liabilities As of June 30, 2025, the Group's management is not aware of any significant claims against the Group - As of June 30, 2025, the Group's management is not aware of any significant claims against the Group (December 31, 2024: nil)[49] Share Consolidation and Change in Board Lot Size The company completed a share consolidation (25 shares into 1) and changed the board lot size to enhance share value and market liquidity - Every twenty-five (25) issued and unissued ordinary shares of HK$0.001 each in the Company's existing share capital have been consolidated into one (1) ordinary share of HK$0.025 each, effective March 5, 2025[50] - The board lot size for trading on the Stock Exchange has been changed from 2,000 existing shares to 6,000 consolidated shares, effective March 19, 2025[50] - As of the date of this report, the Company's authorized share capital is HK$50,000,000, divided into 2,000,000,000 consolidated shares of HK$0.025 each, of which 201,024,000 shares are issued and fully paid or credited as fully paid[50] Employees and Remuneration Policy The Group's employee count and total staff costs decreased, with remuneration policies aligned with market practices, determined by performance and experience, and including retirement benefits and training - As of June 30, 2025, the Group employed a total of 53 employees (December 31, 2024: 60 employees)[51] - Total staff costs (including directors' emoluments) for the review period were approximately HK$6,189 thousand (2024: approximately HK$6,365 thousand)[51] - The Group's remuneration policy aligns with prevailing market practices and is determined based on individual employee performance and experience, also providing retirement benefits and training[51][52][54] Share Option Scheme The company's 2014 share option scheme has expired, with all granted options lapsed; a new 2024 scheme was adopted to incentivize and retain talent, detailing participant eligibility, grant conditions, exercise price, vesting period, and share number limits, though no options have been granted to date - The 2014 Share Option Scheme expired on June 19, 2024, with all 52,350,000 share options granted during its tenure having lapsed, primarily due to employee resignations[55][64][70] - The Company adopted a new 2024 Share Option Scheme, effective for 10 years from May 31, 2024, aimed at rewarding, attracting, and retaining eligible participants who contribute to the Group's long-term development[56][63] - Participants in the 2024 Share Option Scheme include the Group's directors and employees, associated entity participants, and service providers, with the exercise price being the higher of the closing price on the grant date, the average closing price for the preceding five business days, and the nominal value of the shares[57][58] - Share options typically require a minimum 12-month holding period before exercise, with the scheme's authorized limit set at 10% of the total issued shares on the adoption date, and a 1% sub-limit for service providers[59] - Due to the share consolidation, as of June 30, 2025, the total number of shares available for issue under the scheme authorization and service provider sub-limit was 16,752,000 shares and 1,675,200 shares, respectively[66] - No share options have been granted under the 2024 Share Option Scheme since its adoption[67] Foreign Exchange Risk The Group's transactions in Singapore, Indonesia, Japan, and China are primarily settled in local functional currencies, resulting in minimal transactional foreign exchange risk, but translation risk exists when converting these functional currencies to HKD, with no financial instruments used for hedging - The vast majority of transactions by the Group's subsidiaries in Singapore, Indonesia, Japan, and China are settled in Singapore Dollars, Indonesian Rupiah, Japanese Yen, and Renminbi, respectively, resulting in minimal foreign exchange risk[68] - The translation of the functional currencies of these subsidiaries into the presentation currency of HKD may be subject to foreign exchange risk[68] - During the review period, the Group did not use any financial instruments to hedge foreign exchange risk[68] Pledge of Group Assets The Group has pledged certain property, plant, and equipment to secure bank financing - As of June 30, 2025, certain property, plant and equipment with a net book value of approximately HK$138,119 thousand (December 31, 2024: approximately HK$121,870 thousand) were pledged to secure bank financing[69] Dividends The Board of Directors does not recommend the payment of any dividends for the review period - The Board of Directors does not recommend the payment of any dividends for the review period (2024: nil)[71] Financing Agreement and Specific Performance Deed by Controlling Shareholder The Group secured a SGD75,000,000 term loan facility in December 2024 but defaulted on accrued interest payments in June 2025; the Group is actively negotiating with the lender for a waiver and exploring refinancing options - The Company's subsidiary HHI entered into a financing agreement with an independent third-party lender on October 30, 2024, securing a SGD75,000,000 term loan facility[72] - The loan facility was drawn down on December 6, 2024, to repay old debts, fund working capital, and cover financing costs[73] - The loan facility is secured by HHI's operating accounts, a legal mortgage executed by HHI over Hotel G, a fixed and floating charge over all assets and undertakings of HHI, and a charge executed by Silverine over HHI shares[72] - The Group failed to pay accrued interest when due in June 2025 under the terms of the financing agreement, resulting in an event of default[75] - The Group is actively negotiating with the lender for a waiver of the default and exploring options for extension, refinancing, or restructuring of existing borrowings, as well as reducing interest rates and/or deferring principal and interest payments[77] - As of the date of this report, the lender has not demanded immediate repayment of the loan facility, and the total outstanding principal remains SGD75,000,000[75][77] Outlook The company maintains cautious optimism for future prospects, contingent on timely refinancing, and will continue to evaluate its hotel portfolio, seek special asset investment opportunities, and actively address liquidity challenges; Singapore hotels show a positive outlook, while Japanese hotels may be considered for sale due to difficulties, and the Bintan resort development awaits refinancing - The Company maintains cautious optimism for its future prospects, anticipating recovery from the COVID-19 pandemic, provided timely refinancing is secured[78] - The Company will continue to evaluate its existing investment portfolio and seek suitable special asset investment and restructuring opportunities[78] - Singapore hotels have a positive outlook with timely refinancing, and management remains keen to seek business partners to enhance overall performance[78] - Hanatsubaki Ryokan in Japan is currently underperforming, and the Group may consider exploring possible options (including but not limited to disposal of Hanatsubaki Ryokan) to alleviate liquidity pressure, subject to timely refinancing[79] - The Bintan resort development project presents a good opportunity to expand regional presence, but its sustainability requires careful evaluation and successful, timely refinancing[80] - The Company acknowledges the severity of its current liquidity challenges and is actively seeking refinancing to stabilize its financial position[80] Audit Committee The Audit Committee is responsible for reviewing and overseeing the Group's financial reporting process, risk management, and internal control systems; its composition changed on January 6, 2025, and it has reviewed the unaudited consolidated results for the period, confirming compliance with applicable accounting standards and GEM Listing Rules - The Audit Committee is responsible for reviewing and overseeing the Group's financial reporting process, risk management, and internal control systems, and providing recommendations to the Board[81] - The composition of the Audit Committee changed on January 6, 2025, with Mr. Deng Zhaoming appointed as Chairman[81] - The Audit Committee has reviewed the Group's unaudited consolidated results for the review period and this report, deeming them compliant with applicable accounting standards, GEM Listing Rules, and other relevant legal requirements[81] Remuneration Committee The Remuneration Committee is responsible for reviewing and recommending to the Board the remuneration policy and structure for directors and senior management; its composition changed on January 6, 2025, with Ms. Chen Huiqi remaining as Chairperson - The Remuneration Committee is responsible for reviewing and recommending to the Board the policy and structure for all remuneration of the Company's directors and senior management[82] - The composition of the Remuneration Committee changed on January 6, 2025, with Ms. Chen Huiqi remaining as Chairperson of the Remuneration Committee[82] Nomination and Corporate Governance Committee The Nomination and Corporate Governance Committee is responsible for reviewing the board structure, identifying director candidates, and formulating corporate governance policies; its composition changed on January 6, 2025, with Mr. Huang Junxiong remaining as Chairman - The Nomination and Corporate Governance Committee is responsible for reviewing the Board's structure, size, composition, and diversity, identifying suitable candidates for Board membership, and formulating and reviewing the Company's corporate governance policies and practices[83] - The composition of the Nomination and Corporate Governance Committee changed on January 6, 2025, with Mr. Huang Junxiong remaining as Chairman[83] Other Information This section includes additional disclosures regarding corporate governance, directors' securities transactions, competing interests, and shareholdings Corporate Governance Code The Group has complied with the code provisions of the Corporate Governance Code set out in Part 2 of Appendix C1 to the GEM Listing Rules during the review period - For the six months ended June 30, 2025, the Group has complied with the code provisions of the Corporate Governance Code set out in Part 2 of Appendix C1 to the GEM Listing Rules[85] Code for Securities Transactions by Directors The company has adopted the required standard of dealings under the GEM Listing Rules as its code for directors' securities transactions, and all directors have confirmed compliance with this code - The Company has adopted the required standard of dealings set out in Rules 5.48 to 5.67 of the GEM Listing Rules as its code for securities transactions by directors[86] - Following specific enquiries made to all Directors, all Directors confirmed that they have complied with the required standard of dealings and the code for securities transactions by Directors throughout the review period[86] Competing Interests During the review period and up to the date of this report, all directors or controlling shareholders and their respective close associates confirmed that they had no business or interests in any company that competes or may compete with the Group's business - During the review period and up to the date of this report, each Director or controlling shareholder and their respective close associates confirmed that they had no business or interests in any company that constitutes or may constitute a competition with the Group's business, nor any other conflicts of interest with the Group[87] Purchase, Sale or Redemption of the Company's Listed Securities During the review period, neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities - During the review period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[88] Directors' and Chief Executive's Interests in Shares and Underlying Shares of the Company and Associated Corporations As of June 30, 2025, Mr. Lu Tianshun, Mr. Huang Junxiong, and Mr. Yuan Liqian held significant interests in the company's shares through controlled corporations, representing 48.61% of the total issued shares Directors' and Chief Executive's Long Positions in the Company's Shares | Name | Capacity | Total Number of Shares Held | Approximate Percentage of Shareholding | | :--- | :--- | :--- | :--- | | Mr. Lu Tianshun | Interest in controlled corporation | 97,725,600 | 48.61% | | Mr. Huang Junxiong | Interest in controlled corporation | 97,725,600 | 48.61% | | Mr. Yuan Liqian | Interest in controlled corporation | 97,725,600 | 48.61% | - These interests are primarily held through Ace Kingdom Enterprises Corporation, which is owned by Boomerang Investment Limited (36%), Mr. Guo Erche (35%), Billion Supreme Holdings Limited (20%), and Mr. Yuan Liqian (9%)[93] - As of June 30, 2025, the total number of issued shares of the Company was 201,024,000 shares[92] Substantial Shareholders' Interests and Short Positions in Shares and Underlying Shares of the Company As of June 30, 2025, Ace Kingdom Enterprises Corporation and its associates, CMI Financial Holding Company Limited and its associates, and China Orient Asset Management Co. were the company's substantial shareholders, holding significant proportions of shares Substantial Shareholders' Long Positions in Shares | Shareholder Name/Name | Capacity | Number of Shares | Approximate Percentage of Shareholding | | :--- | :--- | :--- | :--- | | Ace Kingdom Enterprises Corporation | Beneficial owner | 97,725,600 | 48.61% | | Boomerang Investment Limited | Interest in controlled corporation | 97,725,600 | 48.61% | | Mr. Guo Erche | Interest in controlled corporation | 97,725,600 | 48.61% | | Billion Supreme Holdings Limited | Interest in controlled corporation | 97,725,600 | 48.61% | | CMI Financial Holding Company Limited | Beneficial owner | 27,600,000 | 13.73% | | China Minsheng Investment Corp., Ltd. | Interest in controlled corporation | 27,600,000 | 13.73% | | China Orient Asset Management Co. | Beneficial owner | 12,400,000 | 6.17% | - Ace Kingdom is owned by Boomerang Investment Limited (36%), Mr. Guo Erche (35%), Billion Supreme Holdings Limited (20%), and Mr. Yuan Liqian (9%)[96] - CMI Financial Holding Company Limited is wholly owned by CMIG Asia Asset Management Limited, which is wholly owned by China Minsheng Investment Corp., Ltd[96] - China Orient Asset Management Co. has a deemed interest in 12,400,000 shares held by its controlled corporation, adjusted for the share consolidation[96]