中国疏浚环保(00871) - 2025 - 中期业绩

Part I. Company Information and Core Financial Statements This section provides an overview of the Company's profile, core financial statements, and key financial performance indicators Company Overview China Dredging Environment Protection Holdings Limited (the Company) is incorporated in the Cayman Islands, listed on the HKEX main board, and primarily engaged in dredging, water management, and marine engineering services - The Company is incorporated in the Cayman Islands, listed on the HKEX main board, and ultimately wholly owned by Mr. Liu Kaijin and his spouse Ms. Zhou Shuhua[8] - The Group's principal businesses include dredging and water management, marine lifting, installation, and other engineering services[9] Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income For the six months ended June 30, 2025, the Group reported revenue of RMB 145,766 thousand, an 11.2% decrease year-on-year, with loss and total comprehensive expense for the period significantly narrowing by 51.3% to RMB 9,478 thousand Summary of Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (For the six months ended June 30) | Metric | 2025 (RMB thousands) | 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 145,766 | 164,089 | -11.2% | | Operating Costs | (120,013) | (145,331) | -17.4% | | Gross Profit | 25,753 | 18,758 | +37.3% | | Other Income | 1,605 | 5,548 | -71.1% | | Net Other Gains and Losses | 1,687 | 465 | +262.8% | | Administrative Expenses | (21,122) | (27,589) | -23.4% | | Finance Costs | (9,550) | (11,946) | -20.0% | | Loss Before Tax | (1,628) | (14,884) | -89.0% | | Income Tax Expense | (7,850) | (4,571) | +71.7% | | Loss and Total Comprehensive Expense for the Period | (9,478) | (19,455) | -51.3% | | Loss for the Period Attributable to Owners of the Company | (21,280) | (31,522) | -32.5% | Condensed Consolidated Statement of Financial Position As of June 30, 2025, the Group's total assets decreased to RMB 1,227,311 thousand, with net current liabilities of approximately RMB 457,896 thousand and a current ratio of 0.41, indicating ongoing liquidity pressure Summary of Condensed Consolidated Statement of Financial Position (As of June 30) | Metric | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Non-current Assets | 902,972 | 939,453 | -3.8% | | Current Assets | 324,339 | 363,266 | -10.8% | | Current Liabilities | 782,235 | 822,621 | -4.9% | | Net Current Liabilities | (457,896) | (459,355) | -0.3% | | Total Equity | 289,566 | 306,988 | -5.7% | | Non-current Liabilities | 155,510 | 173,110 | -10.2% | - As of June 30, 2025, the Group's net current liabilities were approximately RMB 457,896 thousand, with a current ratio of 0.41, indicating persistent liquidity challenges[12][62] Part II. Notes to the Financial Statements This section details the Group's accounting policies, financial performance breakdowns, and specific financial statement items General Information This section provides the Company's basic registration, listing location, ownership structure, primary business scope, and confirms the financial statements are presented in RMB - The Company is an investment holding company, with its subsidiaries primarily engaged in dredging and water management, marine lifting, installation, and other engineering services[9] - The condensed consolidated financial statements are presented in RMB, which is also the Company's functional currency[10] Basis of Preparation of Condensed Consolidated Financial Statements The condensed consolidated financial statements are prepared in accordance with Hong Kong Accounting Standard 34 Interim Financial Reporting and applicable disclosure requirements of the HKEX Listing Rules - The financial statements are prepared in accordance with Hong Kong Accounting Standard 34 Interim Financial Reporting and the disclosure requirements of Appendix D2 to the HKEX Listing Rules[11] Going Concern Assessment As of June 30, 2025, the Group faces significant uncertainties regarding its going concern ability due to net loss and net current liabilities, but the Board believes it can continue operations based on shareholder commitments, banking relationships, and financing efforts - As of June 30, 2025, the Group incurred a net loss of approximately RMB 21,280 thousand and had net current liabilities of approximately RMB 457,896 thousand, indicating significant going concern uncertainties[12] - Controlling shareholder Mr. Liu has committed to providing financial support to ensure the Group can meet its liabilities due within the next 12 months[15] - The Board believes the Group can improve cash flow through renewing bank borrowings, seeking additional financing, and continuous cost control, thus preparing financial statements on a going concern basis[13][15] Significant Accounting Policies The condensed consolidated financial statements are prepared on a historical cost basis, with certain investment properties and financial instruments measured at fair value, and include significant changes since the 2024 annual financial statements - The financial statements are prepared on a historical cost basis, with certain investment properties and financial instruments measured at fair value[14] Application of Revised Hong Kong Financial Reporting Standards The Group has adopted revised Hong Kong Financial Reporting Standards, including HKAS 21 (Amendment) Lack of Exchangeability, with no significant impact on the financial position or disclosures for the current and prior periods - The Group has initially applied revised Hong Kong Financial Reporting Standards, including HKAS 21 (Amendment) "Lack of Exchangeability"[17] - The application of these amendments had no significant impact on the Group's financial position and disclosures for the current and prior periods[17] Revenue For the six months ended June 30, 2025, the Group's total revenue was RMB 145,766 thousand, primarily from other marine business which saw a year-on-year decrease, while infrastructure and reclamation dredging and environmental dredging and water management businesses experienced significant growth Revenue Breakdown (For the six months ended June 30) | Revenue Category | 2025 (RMB thousands) | 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Infrastructure and Reclamation Dredging Business | 19,285 | 7,714 | +150.0% | | Environmental Dredging and Water Management Business | 1,470 | 265 | +454.7% | | Other Marine Business | 125,011 | 152,122 | -17.8% | | Property Management Business | – | 3,988 | -100.0% | | Total Revenue | 145,766 | 164,089 | -11.2% | - All revenue is recognized over time[19] Segment Information The Group's operations are divided into four reportable and operating segments based on reports reviewed by the chief operating decision-maker: infrastructure and reclamation dredging, environmental dredging and water management, other marine business, and property management - The Group's operating segments are determined based on reports reviewed by the executive directors (chief operating decision-makers) for strategic decision-making[20] - The four reportable segments include infrastructure and reclamation dredging, environmental dredging and water management, other marine business, and property management business[21] Segment Descriptions This section details the Group's four main business segments: infrastructure and reclamation dredging (services and consulting), environmental dredging and water management (water quality improvement), other marine business (lifting, installation, salvage, vessel chartering), and property management (leasing and hotel construction) - Infrastructure and reclamation dredging business provides services and related consulting[21] - Environmental dredging and water management business primarily enhances environmental benefits and water quality in inland rivers[21] - Other marine business includes marine lifting, installation, salvage, vessel chartering, and other engineering services[21] - Property management business involves leasing management of shopping malls and factories, and hotel construction[21] Segment Revenue and Results For the six months ended June 30, 2025, external sales for infrastructure and reclamation dredging and environmental dredging and water management businesses grew significantly but still incurred losses, while other marine business saw decreased external sales but remained the only profitable segment, and property management had no external sales and recorded a loss Segment Revenue and Results (For the six months ended June 30) | Segment | 2025 Revenue (RMB thousands) | 2024 Revenue (RMB thousands) | Revenue Change (%) | 2025 Results (RMB thousands) | 2024 Results (RMB thousands) | Results Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Infrastructure and Reclamation Dredging Business | 19,285 | 7,714 | +150.0% | (7,992) | (33,572) | +76.2% | | Environmental Dredging and Water Management Business | 1,470 | 265 | +454.7% | (3,488) | (13,855) | +74.8% | | Other Marine Business | 125,011 | 152,122 | -17.8% | 33,292 | 51,911 | -35.9% | | Property Management Business | – | 3,988 | -100.0% | (780) | 2,954 | -126.4% | | Total | 145,766 | 164,089 | -11.2% | 21,032 | 7,438 | +182.8% | - Segment results exclude certain other income, fair value changes of investment properties, central administrative costs, and finance costs[25] Segment Assets As of June 30, 2025, the Group's total segment assets decreased to RMB 1,212,711 thousand, with other marine business remaining the largest segment by asset size Segment Assets (As of June 30) | Segment | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Infrastructure and Reclamation Dredging Business | 278,104 | 295,092 | -5.8% | | Environmental Dredging and Water Management Business | 137,345 | 145,833 | -5.8% | | Other Marine Business | 585,772 | 597,873 | -2.0% | | Property Management Business | 211,490 | 212,287 | -0.4% | | Total Segment Assets | 1,212,711 | 1,251,085 | -3.1% | | Unallocated Assets (Bank balances and cash, etc) | 14,600 | 51,634 | -71.8% | | Consolidated Assets | 1,227,311 | 1,302,719 | -5.8% | Segment Liabilities and Geographical Information The Group does not present total liabilities for reportable segments as the chief operating decision-maker reviews them on an overall basis; revenue from external customers in Mainland China decreased, while other regions saw significant growth, and most non-current assets are located in Mainland China - The Group does not present total liabilities for reportable segments as the chief operating decision-maker reviews them on an overall basis[27] Revenue from External Customers (by Geographical Region) | Region | 2025 (RMB thousands) | 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Mainland China | 127,966 | 161,090 | -20.6% | | Other Regions | 17,800 | 2,999 | +493.5% | | Total | 145,766 | 164,089 | -11.2% | - The vast majority of the Group's non-current assets are located in Mainland China[29] Net Other Gains and Losses For the six months ended June 30, 2025, the Group's net other gains and losses significantly increased to RMB 1,687 thousand year-on-year, primarily driven by gains from disposal of a subsidiary and exchange gains Net Other Gains and Losses (For the six months ended June 30) | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Loss on disposal of property, plant and equipment | (15) | – | N/A | | Gain on disposal of a subsidiary | 983 | – | N/A | | Net exchange gains and losses | 719 | 465 | +54.6% | | Total | 1,687 | 465 | +262.8% | Income Tax Expense For the six months ended June 30, 2025, income tax expense increased to RMB 7,850 thousand, mainly due to higher PRC corporate income tax, with PRC subsidiaries taxed at 25% and no Hong Kong profits tax provision for Hong Kong companies due to no assessable profits Income Tax Expense (For the six months ended June 30) | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Current tax - PRC corporate income tax | 8,288 | 5,069 | +63.5% | | Deferred tax - Current period | (438) | (498) | -12.1% | | Total | 7,850 | 4,571 | +71.7% | - The corporate income tax rate for PRC subsidiaries is 25%[31] - Hong Kong companies had no assessable profits, thus no Hong Kong profits tax provision was made[32] Components of Loss and Total Comprehensive Expense for the Period This section details the main expenses deducted (or credited) in the loss for the period, including staff costs, investment property rental income and related expenses, depreciation, and operating costs, with staff costs and depreciation being key expense items Items Deducted (Credited) in Loss for the Period (For the six months ended June 30) | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Total staff costs | 28,257 | 25,945 | +8.9% | | Net rental income from investment properties | (1,858) | (3,918) | +52.6% | | Depreciation of property, plant and equipment | 36,455 | 44,144 | -17.4% | | Depreciation of right-of-use assets | 1,726 | 781 | +121.0% | | Operating costs | 120,013 | 145,331 | -17.4% | Loss Per Share For the six months ended June 30, 2025, basic and diluted loss per share attributable to owners of the Company narrowed to RMB 1.42 cents from 2.10 cents in the prior year, with no potential ordinary shares during the period Loss Per Share (For the six months ended June 30) | Metric | 2025 (RMB thousands/cents) | 2024 (RMB thousands/cents) | Change (%) | | :--- | :--- | :--- | :--- | | Loss for the period attributable to owners of the Company | (21,280) | (31,522) | -32.5% | | Weighted average number of ordinary shares (thousands) | 1,503,882 | 1,503,882 | 0.0% | | Basic and diluted loss per share (RMB cents) | (1.42) | (2.10) | +32.4% | - The Group had no potential ordinary shares during the reporting period[34] Dividends For the six months ended June 30, 2025, and 2024, the Company neither paid nor proposed any dividends, nor has it proposed any dividends since the end of the reporting period - The Company neither paid nor proposed any dividends during the reporting period or since the end of the reporting period[35] Movements in Property, Plant and Equipment For the six months ended June 30, 2025, the Group purchased RMB 1,866 thousand in property, plant, and equipment, and disposed of equipment with a carrying amount of RMB 180 thousand, resulting in a loss on disposal of RMB 15 thousand, with no additions or disposals in the prior period - As of June 30, 2025, the Group purchased RMB 1,866 thousand in property, plant and equipment[36] - The Group disposed of plant and equipment with a carrying amount of RMB 180 thousand, resulting in a loss on disposal of RMB 15 thousand[36] - For the six months ended June 30, 2024, the Group made no additions or disposals of property, plant and equipment[36] Trade and Other Receivables and Prepayments As of June 30, 2025, total trade and other receivables and prepayments slightly decreased to RMB 311,384 thousand from December 31, 2024, with trade receivables (net of credit loss allowance) at RMB 187,844 thousand Trade and Other Receivables and Prepayments (As of June 30) | Item | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Trade receivables (net of allowance) | 187,844 | 191,833 | -2.1% | | Bills receivable | 39,079 | 38,260 | +2.1% | | Recoverable VAT | 20,159 | 22,734 | -11.4% | | Deposits | 8,307 | 7,537 | +10.2% | | Other receivables | 13,728 | 17,323 | -20.7% | | Other prepayments | 25,672 | 20,112 | +27.6% | | Loans to investees | 16,595 | 16,595 | 0.0% | | Total | 311,384 | 314,394 | -1.0% | - The Group sets credit limits based on customer credit quality and prepares trade receivables aging analysis based on the agreed date of service completion[38] - As of June 30, 2025, trade receivables (net of allowance) overdue for over 2 years amounted to RMB 55,608 thousand, representing a significant proportion[39] - Loans to investees totaled RMB 16,595 thousand, bearing interest at 4%, are unsecured, and repayable on demand[42] Trade and Other Payables As of June 30, 2025, total trade and other payables decreased by 10.9% to RMB 372,459 thousand from December 31, 2024, with a significant drop in trade payables, though those overdue for over 180 days still constitute a large proportion Trade and Other Payables (As of June 30) | Item | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Trade payables | 142,395 | 184,674 | -22.9% | | Payables for construction costs of investment properties | 70,973 | 70,973 | 0.0% | | Accrued other taxes | 43,746 | 47,880 | -8.7% | | Accrued staff salaries and benefits | 24,485 | 29,316 | -16.5% | | Other payables | 90,860 | 84,881 | +7.0% | | Total | 372,459 | 417,724 | -10.9% | - As of June 30, 2025, trade payables overdue for over 180 days amounted to RMB 81,265 thousand, representing 57.1% of total trade payables[44] - Payables for construction costs of investment properties of approximately RMB 70,973 thousand have been overdue for over 1 year[43] Bank Borrowings As of June 30, 2025, the Group's bank borrowings totaled RMB 178,450 thousand, with effective annual interest rates ranging from 4.50% to 6.80%, having borrowed RMB 136,250 thousand and repaid RMB 142,600 thousand during the period Bank Borrowings (As of June 30) | Metric | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Bank borrowings | 178,450 | 184,800 | -3.4% | | Effective annual interest rate | 4.50% to 6.80% | 4.50% to 6.80% | 0.0% | - During the reporting period, the Group borrowed RMB 136,250 thousand in bank loans and repaid RMB 142,600 thousand in bank loans[45] Share Capital As of June 30, 2025, the Company's authorized share capital was 5,000,000 thousand shares, with 1,503,882 thousand shares issued and fully paid, amounting to RMB 255,247 thousand, and no changes in share capital during the reporting period Share Capital Structure (As of June 30) | Item | Number of Shares (thousands) | Amount (HKD thousands) | Equivalent Amount (RMB thousands) | | :--- | :--- | :--- | :--- | | Authorized share capital (par value HKD 0.2 per share) | 5,000,000 | 1,000,000 | N/A | | Issued and fully paid share capital (par value HKD 0.2 per share) | 1,503,882 | 300,776 | 255,247 | - There were no changes in the Company's share capital for the six months ended June 30, 2025, and 2024[48] Part III. Management Discussion and Analysis This section provides an overview of the Group's business performance, financial results, liquidity, capital structure, and future outlook Overview The Group primarily engages in dredging, categorized into infrastructure and reclamation dredging, environmental dredging and water management, and other marine businesses, alongside property management, reporting a narrowed loss of approximately RMB 9,500 thousand for the period - The Group's core business is dredging, divided into infrastructure and reclamation dredging, environmental dredging and water management, and other marine businesses, also including property management[49] - During the reporting period, the Group recorded a loss of approximately RMB 9,500 thousand, significantly narrowing from a loss of RMB 19,500 thousand in the prior period[49] - Loss attributable to shareholders of the Company was approximately RMB 21,300 thousand[49] Business Review During the reporting period, infrastructure and reclamation dredging and environmental dredging and water management businesses saw significant revenue growth, while other marine business contracted due to intense market competition, and property management ceased leasing activities to reduce costs - Revenue from the infrastructure and reclamation dredging business segment increased by approximately 150% year-on-year, with the Group actively seeking project opportunities in Southeast Asia and Belt and Road countries[50] - Revenue from the environmental dredging and water management business segment increased by approximately 455% year-on-year, but its development in the second half remains relatively unstable[50] - The other marine business segment faced contraction due to intense market competition, with revenue decreasing from approximately RMB 152,100 thousand to approximately RMB 125,000 thousand[50] - The property management business suspended all leasing activities to reduce operating costs, with future plans dependent on market trends[51] Infrastructure and Reclamation Dredging Business Despite challenges, this business segment's revenue increased by approximately 150% year-on-year, primarily due to an increase in contracted projects, with the Group actively seeking opportunities in Southeast Asia and Belt and Road countries - During the reporting period, revenue from the infrastructure and reclamation dredging business segment increased by approximately 150%, mainly due to an increase in contracted projects[50][52] - The Group is committed to seeking dredging project opportunities in Southeast Asia and Belt and Road countries to enhance future performance[50] Environmental Dredging and Water Management Business This business segment's revenue significantly increased by approximately 455% year-on-year, primarily due to an increase in contracted projects, though its development in the second half remains relatively unstable - During the reporting period, revenue from the environmental dredging and water management business segment increased by approximately 455%, mainly due to an increase in contracted projects[50][52] - The development of this segment in the second half remains relatively unstable[50] Other Marine Business This business segment faced contraction due to intense market competition, with revenue decreasing by 18% from approximately RMB 152,100 thousand to RMB 125,000 thousand year-on-year - The other marine business segment contracted due to intense market competition, with revenue decreasing by 18% year-on-year[50][52] Property Management Business Affected by a sharp decline in the domestic property market, the Group suspended all leasing activities to reduce operating costs, generating no revenue during the reporting period, with future plans dependent on market trends - The property management business suspended all leasing activities to reduce operating costs due to the domestic property market downturn, resulting in no revenue during the reporting period[51][52] Financial Review The Group's revenue decreased by 11.2% to RMB 145,800 thousand, but gross profit increased by 37% to RMB 25,800 thousand, raising the overall gross margin to 17.7%; administrative expenses and finance costs decreased, while income tax expense increased, leading to a significantly narrowed loss for the period - During the reporting period, the Group's revenue was approximately RMB 145,800 thousand, a 11.2% decrease year-on-year[52] - Gross profit increased by 37% to approximately RMB 25,800 thousand, with the overall gross margin rising from 11.4% to 17.7%[53] - Loss for the period was approximately RMB 9,500 thousand, significantly narrowing from a loss of RMB 19,500 thousand in the prior period[60] Revenue The Group's total revenue decreased by 11.2% year-on-year, with infrastructure and reclamation dredging and environmental dredging and water management revenues growing by 150% and 455% respectively, while other marine business revenue decreased by 18% and property management business generated no revenue Revenue Changes (For the six months ended June 30) | Business Segment | 2025 Revenue (RMB thousands) | 2024 Revenue (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Total Revenue | 145,800 | 164,100 | -11.2% | | Infrastructure and Reclamation Dredging Business | 19,300 | 7,700 | +150.0% | | Environmental Dredging and Water Management Business | 1,500 | 300 | +455.0% | | Other Marine Business | 125,000 | 152,100 | -18.0% | | Property Management Business | – | 4,000 | -100.0% | Operating Costs and Gross Profit Operating costs decreased by 17.4% to RMB 120,000 thousand, and gross profit increased by 37% to RMB 25,800 thousand; infrastructure and reclamation dredging and environmental dredging and water management businesses still incurred gross losses, other marine business's gross margin declined, and property management turned from profit to loss, with the overall gross margin rising to 17.7% - Operating costs decreased by 17.4% to approximately RMB 120,000 thousand[53] - Gross profit increased by 37% to approximately RMB 25,800 thousand, with the overall gross margin rising from 11.4% to 17.7%[53] - Infrastructure and reclamation dredging and environmental dredging and water management businesses recorded gross losses, mainly because revenue was insufficient to cover fixed expenses and depreciation[53] - The gross margin of the other marine business segment decreased from 34.1% to 26.6%, primarily due to a decline in revenue[53] - The property management business segment's gross profit turned from a profit to a loss of approximately RMB 800 thousand[53] Other Income Other income decreased by 71.1% from approximately RMB 5,500 thousand in the prior period to approximately RMB 1,600 thousand in the reporting period, mainly due to a reduction in sundry income Other Income Changes (For the six months ended June 30) | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Other income | 1,600 | 5,500 | -71.1% | - The decrease in other income was primarily due to a reduction in sundry income[54] Net Other Gains Net other gains increased from approximately RMB 500 thousand in the prior period to approximately RMB 1,700 thousand in the reporting period, primarily due to gains from the disposal of a subsidiary Net Other Gains Changes (For the six months ended June 30) | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Net Other Gains | 1,700 | 500 | +240.0% | - The increase in net other gains was primarily due to gains from the disposal of a subsidiary recorded during the reporting period[55] Marketing and Promotion Expenses No marketing and promotion expenses were incurred during the reporting period - No marketing and promotion expenses were incurred during the reporting period[56] Administrative Expenses Administrative expenses decreased by 23.4% year-on-year to approximately RMB 21,100 thousand, primarily due to a reduction in depreciation Administrative Expenses Changes (For the six months ended June 30) | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Administrative expenses | 21,100 | 27,600 | -23.4% | - The decrease in administrative expenses was primarily due to a reduction in depreciation[57] Finance Costs Finance costs decreased by 20% year-on-year to approximately RMB 9,600 thousand Finance Costs Changes (For the six months ended June 30) | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Finance costs | 9,600 | 12,000 | -20.0% | Income Tax Expense Income tax expense increased by 71.7% from approximately RMB 4,600 thousand in the prior period to approximately RMB 7,900 thousand in the reporting period Income Tax Expense Changes (For the six months ended June 30) | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Income tax expense | 7,900 | 4,600 | +71.7% | Loss for the Period Considering the above factors, the loss for the reporting period significantly narrowed to approximately RMB 9,500 thousand, compared to a loss of approximately RMB 19,500 thousand in the prior period Loss for the Period Changes (For the six months ended June 30) | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Loss for the period | (9,500) | (19,500) | +51.3% | Loss Per Share Loss per share for the reporting period narrowed to approximately RMB 1.4 cents, compared to approximately RMB 2.1 cents in the prior period Loss Per Share Changes (For the six months ended June 30) | Item | 2025 (RMB cents) | 2024 (RMB cents) | Change (%) | | :--- | :--- | :--- | :--- | | Loss per share | (1.4) | (2.1) | +33.3% | Financial Position As of June 30, 2025, the Group's total equity was approximately RMB 289,600 thousand, with net current liabilities of approximately RMB 457,900 thousand and a current ratio of 0.41, indicating liquidity pressure Summary of Financial Position (As of June 30) | Metric | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Total Equity | 289,600 | 307,000 | -5.7% | | Net Current Liabilities | (457,900) | (459,400) | -0.3% | | Current Ratio | 0.41 | 0.44 | -6.8% | Liquidity and Financial Resources The Group maintains prudent cash and financial management with centralized treasury activities; as of June 30, 2025, bank balances and cash significantly decreased to RMB 13,000 thousand, while total liabilities decreased by approximately 6% and the gearing ratio fell to 107.5%, mainly due to loan repayments - The Group adopts prudent cash and financial management policies with centralized treasury activities, and cash is primarily denominated in RMB and HKD[63] Liquidity and Financial Resources (As of June 30) | Metric | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Bank balances and cash | 13,000 | 48,900 | -73.4% | | Trade receivables | 187,800 | 191,800 | -2.1% | | Total Liabilities | 937,700 | 997,500 | -6.0% | | Gearing Ratio | 107.5% | 108.4% | -0.9% | - The decrease in the gearing ratio was primarily due to the repayment of bank and other borrowings during the reporting period[63] Capital Structure The Group's capital structure comprises debt and equity reserves attributable to owners of the Company; the Board reviews the capital structure semi-annually and has completed a capital reorganization involving capital reduction and share subdivision to offset accumulated losses - The Group's capital structure consists of debt (including amounts due to non-controlling interests, bank borrowings, and other borrowings) and equity reserves attributable to owners of the Company[64] - The Board reviews the capital structure semi-annually and has completed a capital reorganization, involving capital reduction and share subdivision, aimed at offsetting accumulated losses[64][65][67] - The credit amount of HKD 270,698,670 arising from the capital reduction will be used to offset the Company's accumulated losses[67] Risk Management Policies The Group faces market risks, such as currency and interest rate risks, and aims to minimize their adverse effects, having recognized exchange gains of approximately RMB 500 thousand during the period; it does not enter into interest rate hedging contracts but closely monitors interest rate risk - The Group faces market risks, such as currency risk and interest rate risk, and aims to minimize their adverse effects[66] - Exchange gains of approximately RMB 500 thousand were recognized during the reporting period (compared to a loss of approximately RMB 500 thousand in the prior period)[66] - The Group has not entered into interest rate hedging contracts but continuously monitors interest rate risk closely[66] Pledge of Group Assets As of June 30, 2025, the Group's bank borrowings are secured by dredgers, land, properties beneficially owned by Mr. Liu Kaijin, and personal guarantees from Mr. Liu Kaijin and Ms. Zhou Shuhua - Bank borrowings are secured by the Group's dredgers and land, properties beneficially owned by Mr. Liu Kaijin, and personal guarantees from Mr. Liu Kaijin and Ms. Zhou Shuhua[68] - Intra-group pledges arise from contractual arrangements between two wholly-owned subsidiaries[68] Significant Acquisitions and Disposals During the reporting period, the Group had no significant acquisitions or disposals of subsidiaries, associates, and joint ventures, nor any definite plans for major investments or capital assets - During the reporting period, the Group had no significant acquisitions or disposals of subsidiaries, associates, and joint ventures[69] - The Group has no definite plans for major investments or capital assets[69] Capital Commitments and Contingent Liabilities As of June 30, 2025, the Group's capital commitments were approximately RMB 73,600 thousand, primarily for hotel construction costs, with no significant contingent liabilities during the reporting period Capital Commitments and Contingent Liabilities (As of June 30) | Item | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Capital commitments | 73,600 | 73,600 | 0.0% | | Contingent liabilities | None | None | 0.0% | - Capital commitments primarily include hotel construction costs[70] Employees and Remuneration Policies As of June 30, 2025, the Group had 393 employees, with total staff costs of approximately RMB 30,300 thousand, an increase of RMB 4,400 thousand year-on-year, mainly due to increased contributions to social insurance and retirement benefit schemes, and remuneration policies are based on employee performance and market conditions Employee and Remuneration Information (As of June 30) | Metric | June 30, 2025 | December 31, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Number of Employees | 393 | 415 | -5.4% | | Total Staff Costs (RMB thousands) | 30,300 | 25,900 | +17.0% | - The increase in staff costs was primarily due to increased contributions to staff social insurance and retirement benefit schemes[71] - Remuneration policies are determined by the Board based on individual performance and market conditions, including salaries, discretionary bonuses, pension contributions, and share options[71] Future Outlook The Group will continue to implement cost control, stable operations, and risk reduction strategies, optimizing its operational footprint and enhancing risk management capabilities, having temporarily ceased environmental new energy and digital business operations, while actively seeking high-growth opportunities and robust financial solutions to support business development - The Group will continue to adopt strategies of cost control, stable operations, and risk reduction, committed to maintaining consistency in construction projects, streamlining operations, and strengthening management[72] - It has been decided to temporarily cease operations related to environmental new energy and digital business opportunities, though these may be revisited when market conditions are favorable in the future[72] - The Group will continue to actively seek high-growth opportunities, diversify revenue streams, and proactively identify and implement robust and feasible financial solutions to strengthen its capital structure[72] - During the reporting period, several infrastructure and reclamation dredging and environmental dredging and water management business projects made progress compared to the prior period[72] Interim Dividend The Board has decided not to pay any dividends for the reporting period - The Board has decided not to pay any dividends for the reporting period[73] Purchase, Sale or Redemption of the Company's Listed Securities During the reporting period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities - During the reporting period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[74] Part IV. Other Information This section covers corporate governance, audit committee review, publication of results, and board composition Compliance with Corporate Governance Code The Company is committed to high standards of corporate governance, having complied with all code provisions of the Corporate Governance Code in Appendix C1 of the Listing Rules throughout the reporting period without deviation - The Company is committed to high standards of corporate governance, having complied with all code provisions of the Corporate Governance Code set out in Appendix C1 of the Listing Rules throughout the reporting period, with no deviations[75] Audit Committee and Review of Unaudited Financial Statements The Board's Audit Committee, comprising three independent non-executive directors, has reviewed the Group's adopted accounting principles and practices, financial reporting matters, including the unaudited consolidated results for the reporting period, with management - The Audit Committee, composed of three independent non-executive directors, has reviewed the Group's accounting principles, practices, and financial reporting matters, including the unaudited consolidated results[76] Publication of Interim Results and Interim Report This interim results announcement has been published on the Company's and HKEX websites, and the interim report containing all information required by Appendix D2 of the Listing Rules will be dispatched to shareholders and available online in due course - This interim results announcement has been published on the Company's website (www.cdep.com.hk) and the HKEX website (www.hkexnews.hk)[77](index=77&type=chunk) - The interim report, containing all information required by Appendix D2 of the Listing Rules, will be dispatched to shareholders and made available on the website in due course[77] Board of Directors As of the announcement date, the Board of Directors includes Ms. Zhou Shuhua (Chairperson and Executive Director), Mr. Wu Xize (Executive Director and CEO), Mr. Zhang Chunxi and Mr. Wang Jianhua (Executive Directors), and Mr. Huan Xuedong, Mr. Chan Ming Sum, and Mr. Leung Chak Chuen (Independent Non-executive Directors) - The Board of Directors includes Ms. Zhou Shuhua (Chairperson and Executive Director), Mr. Wu Xize (Executive Director and Chief Executive Officer), Mr. Zhang Chunxi, and Mr. Wang Jianhua (Executive Directors)[79] - Independent non-executive directors include Mr. Huan Xuedong, Mr. Chan Ming Sum, and Mr. Leung Chak Chuen[79]