中国蜀塔(08623) - 2025 - 中期业绩

Company Information Board of Directors and Key Personnel The company's board comprises six executive directors (including Chairman and CEO Mr. Dang Fei) and three independent non-executive directors, with details on company secretary, compliance officer, authorized representatives, and committee members - The Board of Directors consists of six executive directors (including Chairman and CEO Mr. Dang Fei) and three independent non-executive directors[9] - The company has an Audit Committee, Remuneration Committee, and Nomination Committee, with their respective chairmen and members listed[9] Registered and Operating Locations The company is registered in the Cayman Islands, with primary operations in Guangyuan City, Sichuan Province, China, and a principal place of business in Hong Kong, alongside details of banks and share registrar - The company's registered address is in the Cayman Islands, with its principal place of business in China located in Guangyuan City, Sichuan Province, and in Hong Kong in Tsim Sha Tsui, Kowloon[9][10] - Principal bankers include Bank of Communications, Bank of China, and branches of Chengdu Rural Commercial Bank in Pidu District[10] Unaudited Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income Overview of Profit or Loss and Comprehensive Income For the six months ended June 30, 2025, the Group experienced significant revenue growth but a decline in gross profit and an expanded loss for the period, primarily due to increased cost of sales and reduced other income, with basic and diluted loss per share remaining unchanged Key Profit or Loss and Comprehensive Income Data | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Revenue | 168,245 | 89,327 | | Cost of sales | (167,583) | (88,241) | | Gross profit | 662 | 1,086 | | Other income | 848 | 4,276 | | Loss before income tax expense | (15,850) | (13,892) | | Loss for the period | (16,476) | (11,220) | | Loss for the period attributable to owners of the Company | (15,023) | (11,257) | | Basic and diluted loss per share (RMB cents) | (0.12) | (0.12) | - Revenue increased by 88.3% year-on-year, from RMB 89,327 thousands in 2024 to RMB 168,245 thousands in 2025[11] - Loss for the period expanded from RMB 11,220 thousands in 2024 to RMB 16,476 thousands in 2025[11] Unaudited Condensed Consolidated Statement of Financial Position Financial Position As of June 30, 2025, the Group's total assets and net assets both decreased, with an increase in net current liabilities leading to negative equity attributable to owners of the Company, reflecting a deteriorating financial position Key Financial Position Data | Indicator | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Total assets | 228,223 | 272,799 | | Net current liabilities | (79,509) | (63,765) | | Net assets | 693 | 12,468 | | Equity attributable to owners of the Company | (10,451) | (129) | | Total equity | 693 | 12,468 | - Total assets decreased from RMB 272,799 thousands as of December 31, 2024, to RMB 228,223 thousands as of June 30, 2025[13] - Equity attributable to owners of the Company further deteriorated from negative RMB 129 thousands as of December 31, 2024, to negative RMB 10,451 thousands as of June 30, 2025[14] Unaudited Condensed Consolidated Statement of Changes in Equity Analysis of Changes in Equity For the six months ended June 30, 2025, equity attributable to owners of the Company significantly decreased due to the loss for the period, with accumulated losses continuing to rise despite new share issuance, leading to a substantial decline in total equity Key Equity Movement Data | Indicator | January 1, 2025 (RMB thousands) | June 30, 2025 (RMB thousands) | | :--- | :--- | :--- | | Share capital | 9,913 | 10,345 | | Accumulated losses | (129,399) | (144,422) | | Subtotal of equity attributable to owners of the Company | (129) | (10,451) | | Non-controlling interests | 12,597 | 11,144 | | Total equity | 12,468 | 693 | - Loss for the period resulted in an increase of RMB 15,023 thousands in accumulated losses attributable to owners of the Company[15] - Share issuance led to an increase of RMB 4,730 thousands in share capital and share premium[15] Unaudited Condensed Consolidated Statement of Cash Flows Cash Flow Analysis For the six months ended June 30, 2025, the Group experienced a decrease in net cash from operating activities, reduced cash outflow from investing activities, and a decrease in net cash from financing activities, yet achieved a net increase in cash and cash equivalents at period-end Key Cash Flow Data | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Net cash from operating activities | 1,623 | 9,178 | | Net cash used in investing activities | (3,049) | (18,800) | | Net cash from financing activities | 2,026 | 8,556 | | Net increase/(decrease) in cash and cash equivalents | 600 | (1,066) | | Cash and cash equivalents at end of period | 2,376 | 343 | - Net cash from operating activities decreased from RMB 9,178 thousands in 2024 to RMB 1,623 thousands in 2025[17] - Cash and cash equivalents at period-end increased from RMB 343 thousands in 2024 to RMB 2,376 thousands in 2025[17] Notes to the Unaudited Condensed Consolidated Financial Statements General Information and Basis of Preparation The Company is an investment holding company registered in the Cayman Islands, with subsidiaries primarily engaged in the production and sale of wires, cables, aluminum products, and polymeric materials in China; interim financial statements are prepared in RMB according to HKAS 34 and GEM Listing Rules - The Company is primarily engaged in the production and sale of wires and cables, sale of aluminum products, and sale of polymeric materials in China[18] - The interim financial statements are prepared in accordance with Hong Kong Accounting Standard 34 issued by the Hong Kong Institute of Certified Public Accountants and the applicable disclosure requirements of the GEM Listing Rules of the Stock Exchange[20] - The financial statements are presented in RMB and prepared on a historical cost basis[21][22] Accounting Policies and Estimates Revisions to Hong Kong Financial Reporting Standards issued by the HKICPA were first applied in this period but had no significant impact on the financial statements, which involve management's judgments, estimates, and assumptions - Revisions to Hong Kong Accounting Standard 21 and Hong Kong Financial Reporting Standard 1 were first applied in this period but had no significant impact on the financial statements[24] - The preparation of financial statements requires the application of certain judgments, estimates, and assumptions, and actual results may differ from these estimates[23][25] Financial Risk Management and Segment Reporting The Group's operations involve credit, market (foreign exchange and interest rate), and liquidity risks, without the use of derivative instruments for hedging; it has only one reportable operating segment: the sale of wires, cables, aluminum products, and polymeric materials, with all revenue and non-current assets originating from China - The Group's operations involve credit risk, market risk (foreign exchange risk and interest rate risk), and liquidity risk, without the use of derivative instruments for hedging[26] - The Group has only one reportable operating segment, which is the sale of wires, cables, aluminum products, and polymeric materials[28] - All of the Group's revenue is derived from customers in China, and all non-current assets are located in China[29] Revenue from Major Customers | Customer | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Customer A | 108,930 | 70,273 | Revenue and Other Income Revenue for the period primarily stemmed from the production and sale of wires, cables, and aluminum products, with wire and cable contributing the most; other income significantly decreased, mainly due to lower interest income and government grants Revenue by Product Type | Product Type | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Production and sale of wires and cables | 167,023 | 89,327 | | Production and sale of aluminum products | 1,222 | – | | Total revenue | 168,245 | 89,327 | Other Income Details | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Interest income | 1 | 1,208 | | Government grants and subsidies | 470 | 1,943 | | Rental income | 215 | 513 | | Others | 162 | 612 | | Total | 848 | 4,276 | - Other income significantly decreased from RMB 4,276 thousands in 2024 to RMB 848 thousands in 2025, primarily due to reduced interest income and government subsidies[36] Finance Costs and Loss Before Income Tax Expense Finance costs remained relatively stable, mainly comprising interest expenses on bank and other borrowings, while loss before income tax expense increased, primarily influenced by inventory costs, depreciation, amortization, and expected credit loss provisions Finance Costs | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Interest expense on bank and other borrowings | 2,650 | 2,844 | | Interest expense on lease liabilities | 146 | – | | Total finance costs | 2,796 | 2,844 | Components of Loss Before Income Tax Expense | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Cost of inventories recognized as expense | 167,583 | 88,241 | | Depreciation of property, plant and equipment | 3,464 | 2,749 | | Provision for expected credit losses on trade receivables | 2,536 | 2 | | Employee costs | 4,691 | 4,391 | - Loss before income tax expense increased from RMB 13,892 thousands in 2024 to RMB 15,850 thousands in 2025[11] Income Tax Expense and Loss Per Share The period recorded an income tax expense, compared to an income tax credit in the prior year, mainly due to reduced recognition of deferred tax assets; loss per share remained consistent with the prior period, as no potentially dilutive ordinary shares existed Income Tax Expense (Credit) | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Deferred tax (credit) | 626 | (2,672) | | Income tax (credit) | 626 | (2,672) | - Guangyuan Tongchuang New Material Co, Ltd is eligible for a 10% income tax rate under the Western Development Tax Incentive Policy[42] - Basic and diluted loss per share attributable to owners of the Company for the period was RMB 0.12[12][44] Property, Plant and Equipment The cost of acquiring machinery and office equipment significantly decreased during the period, reflecting a slowdown in capital expenditure - For the six months ended June 30, 2025, the Group's cost of acquiring machinery and office equipment was approximately RMB 3,049 thousands, a significant decrease from RMB 18,800 thousands in the prior year[45] Trade and Other Receivables Total trade receivables decreased, but the provision for expected credit losses slightly increased, with the aging analysis of receivables showing a higher proportion of amounts over 365 days Trade and Other Receivables | Item | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Trade receivables | 139,930 | 169,834 | | Less: Provision for expected credit losses on trade receivables | (56,286) | (55,313) | | Net trade receivables | 83,644 | 114,521 | | Prepayments, deposits and other receivables | 8,693 | 34,303 | | Total | 92,778 | 149,470 | Aging Analysis of Trade Receivables | Aging | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | 0 to 60 days | 21,543 | 14,491 | | 61 to 180 days | 3,661 | 22,661 | | 181 to 365 days | 84,329 | 3,166 | | Over 365 days | 30,390 | 129,516 | | Total | 139,923 | 169,834 | - Provision for expected credit losses on trade receivables increased from RMB 55,313 thousands as of December 31, 2024, to RMB 56,286 thousands as of June 30, 2025[46] Trade and Other Payables Total trade payables decreased, but interest payable and other payables increased, with supplier credit terms generally ranging from 0 to 120 days Trade and Other Payables | Item | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Current trade payables | 83,018 | 97,285 | | Accruals and other payables | 60,363 | 68,939 | | Non-current trade payables | — | 2,077 | | Non-current other payables | 2,677 | 1,550 | Aging Analysis of Trade Payables | Aging | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | 0 to 60 days | 20,996 | 46,632 | | 61 to 180 days | 32,148 | 26,504 | | 181 to 365 days | 2,953 | 5,386 | | Over 365 days | 26,921 | 20,840 | | Total | 83,018 | 99,362 | - Interest payable increased from RMB 8,215 thousands as of December 31, 2024, to RMB 9,450 thousands as of June 30, 2025[48] Borrowings The Group's total borrowings slightly decreased, but most are current borrowings repayable within one year, with approximately RMB 6,900 thousands in defaulted borrowings, which are secured by various assets and individuals Borrowings Details | Item | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Current borrowings | 53,150 | 49,708 | | Non-current borrowings | 16,813 | 22,820 | | Total borrowings | 69,963 | 72,528 | - As of June 30, 2025, the Group was in default on borrowings totaling approximately RMB 6,900 thousands in principal amount[51] - Borrowings are secured by buildings, land use rights, plant and machinery, properties of the Company's directors and their close family members, properties of independent third parties, and inventory of a shareholder[51] Share Capital The Company's share capital increased due to a rights issue, with 45,775,245 ordinary shares issued, raising net proceeds of approximately HKD 4.17 million Share Capital Movement | Item | Number of Shares | Amount (RMB thousands) | | :--- | :--- | :--- | | As at December 31, 2024 | 110,400,000 | 9,913 | | Shares issued after rights issue | 45,775,245 | 432 | | As at June 30, 2025 | 156,175,245 | 10,345 | - On May 6, 2025, the Company issued 45,775,245 ordinary shares under a rights issue arrangement, raising net proceeds of approximately HKD 4.17 million[53][84] Related Party Transactions Remuneration for the Group's key management personnel decreased, and properties of key management personnel and their close family members were pledged as collateral for bank and other borrowings Key Management Personnel Remuneration | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Salaries, allowances and other benefits | 268 | 398 | | Contributions to defined contribution retirement plans | 39 | 64 | | Total | 307 | 462 | - The Group's key management personnel and their close family members pledged their properties as collateral for bank and other borrowings[57] Management Discussion and Analysis Business Review and Outlook The Group, as a wire and cable manufacturer and supplier, operates in wire and cable, aluminum products, and polymeric materials; despite macroeconomic uncertainties and increased competition, future growth opportunities lie in China's infrastructure, renewable energy, 5G development, and domestic market expansion, with the Group focusing on product quality, innovation, and prudent financial management - The Group is primarily engaged in the manufacturing and sale of wires and cables, as well as aluminum cast-rolled coil processing, aluminum foil manufacturing, and polymeric material sales[60] - Future growth drivers include the Chinese government's infrastructure investments in power grid upgrades, urban transportation networks, and new industrial parks[62] - The development of renewable energy (solar and wind power) and 5G network expansion in China will stimulate demand for specialized and advanced cable solutions[63][64] - The Group will strengthen its local customer network, diversify its customer base, and enhance operational efficiency and cost management through optimizing production processes, outsourcing, exploring new businesses, and digitalization[65][66] Financial Review Revenue significantly increased during the period, but gross profit and gross margin declined due to rising raw material costs and price competition; other income substantially decreased, leading to an expanded loss for the period, while selling and distribution expenses decreased, administrative expenses slightly declined, and finance costs remained stable Revenue, Gross Profit and Gross Margin by Product Type | Product Type | 2025 Revenue (RMB thousands) | 2024 Revenue (RMB thousands) | 2025 Gross Profit (RMB thousands) | 2024 Gross Profit (RMB thousands) | 2025 Gross Margin | 2024 Gross Margin | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Classic finished wire and cable - Copper | 58 | – | 17 | – | 29.3% | – | | Classic finished wire and cable - Aluminum | 146,305 | 88,804 | 577 | 1,080 | 0.4% | 1.2% | | Semi-finished wire - Aluminum rod | 19,856 | 523 | 58 | 6 | 0.3% | 1.1% | | Polymeric materials and others | 2,026 | – | 10 | – | 0.5% | – | | Total | 168,245 | 89,327 | 662 | 1,086 | 0.4% | 1.2% | - Revenue increased by approximately 88.3% year-on-year to RMB 168.2 million, primarily due to increased market demand[67] - Gross profit decreased by approximately 39.0% to RMB 0.7 million, with gross margin falling from 1.2% to 0.4%, mainly due to a significant increase in raw material and subcontracting costs and price competition[69] - Other income and gains significantly decreased from RMB 4.3 million to RMB 0.8 million, primarily due to reduced interest income from loans and government subsidies[70] - Loss attributable to owners of the Company increased by approximately 33.4% to RMB 15.0 million, mainly due to a significant decrease in other income and gains[75] Liquidity, Financial Resources and Capital Structure The Group primarily funds its operations through cash generated from operations, borrowings, and shareholder advances; cash and cash equivalents slightly increased, but total borrowings remain high, with most being short-term, and total equity significantly decreased, worsening the debt-to-equity ratio, prompting management to continue prudent financial management strategies - As of June 30, 2025, cash and cash equivalents were approximately RMB 2.4 million, a slight increase from RMB 1.8 million as of December 31, 2024[76] - Total borrowings were approximately RMB 70.0 million, of which RMB 53.2 million are repayable within one year or on demand, indicating reliance on short-term financing[76] - Total equity significantly decreased from RMB 12.5 million as of December 31, 2024, to RMB 0.7 million as of June 30, 2025, leading to a deterioration in the debt-to-equity ratio[76] - Management believes the capital structure remains challenging and will strengthen cash flow control and explore financing options[77] Pledge of Assets and Capital Commitments The Group has pledged buildings, land use rights, and plant and machinery to secure bank and other borrowings, with capital commitments primarily for capital injections into subsidiaries Net Book Value of Pledged Assets | Pledged Assets | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Buildings | 39,862 | 40,373 | | Land use rights | 5,805 | 5,901 | | Plant and machinery | 6,342 | 2,523 | | Total | 52,009 | 48,797 | - As of June 30, 2025, the Group had capital commitments for capital injections into subsidiaries of approximately RMB 10,810 thousands[79] Employees and Remuneration Policy The Group's employee headcount increased, with a corresponding rise in total employee benefit expenses, and remuneration policy is based on market terms, individual performance, qualifications, and experience - As of June 30, 2025, the Group employed 127 full-time employees, an increase from 119 in the prior year[82] - Total employee benefit expenses increased from approximately RMB 4.4 million in 2024 to approximately RMB 4.7 million in 2025[82] Rights Issue and Use of Proceeds The Company completed a rights issue, issuing 45,775,245 shares and raising net proceeds of approximately HKD 4.17 million, primarily allocated to debt repayment, investment in non-automotive industries, and general working capital - The Company completed a rights issue on May 6, 2025, issuing 45,775,245 ordinary shares and raising net proceeds of approximately HKD 4.17 million[84] Use of Proceeds from Rights Issue | Intended Use | Intended Proceeds (HKD thousands) | Actual Use (HKD thousands) | Unutilized Balance (HKD thousands) | Expected Timeline for Use | | :--- | :--- | :--- | :--- | :--- | | Repayment of the Group's debts and borrowings | 1,250 | 1,250 | — | Not applicable | | Investment in non-automotive industries | 1,670 | 100 | 1,570 | June 30, 2026 | | Working capital | 1,250 | 1,250 | — | Not applicable | | Total | 4,170 | 2,600 | 1,570 | | Other Information Interim Dividend and Securities Transactions The Board decided not to declare an interim dividend, and neither the Company nor its subsidiaries engaged in any purchase, sale, or redemption of the Company's listed securities during the reporting period - The Directors decided not to declare any interim dividend for the six months ended June 30, 2025[87] - Neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[88] Compliance with Corporate Governance Code The Group has complied with the Corporate Governance Code, except for Code Provision C.2.1 (separation of Chairman and CEO roles), as the Board believes Mr. Dang Fei's dual role maximizes Group interests, and all Directors confirm full compliance with the Model Code for Securities Transactions - The Company has complied with the Corporate Governance Code, except for Code Provision C.2.1[89] - Mr. Dang Fei serves as both Chairman and Chief Executive Officer, an arrangement the Board believes maximizes the Group's interests[89] - All Directors confirmed full compliance with the Model Code for Securities Transactions by Directors during the reporting period[90] Directors' and Major Shareholders' Interests The report discloses the long positions in the Company's shares held by Directors, chief executives, and major shareholders, including interests through controlled corporations and spouses, with Directors confirming no competing interests Directors' and Chief Executive's Long Positions in Shares | Name | Capacity/Nature of Interest | Number of Shares | Approximate Percentage | | :--- | :--- | :--- | :--- | | Mr. Dang Fei | Interest in controlled corporation | 52,692,000 | 33.74% | | Mr. Wang Xiaozhong | Interest in controlled corporation | 14,964,000 | 9.58% | | Ms. Luo Qian | Interest in controlled corporation | 1,168,500 | 0.75% | Major Shareholders' and Other Persons' Long Positions in Shares | Shareholder Name/Name | Capacity/Nature of Interest | Number of Shares (Long Position) | Approximate Percentage of Interest | | :--- | :--- | :--- | :--- | | Red Fly Investment Limited | Beneficial owner | 52,692,000 | 33.74% | | Xseven Investment Limited | Beneficial owner | 14,694,000 | 9.58% | | Ms. Gao Hong | Interest of spouse | 14,694,000 | 9.58% | - The Directors confirmed that no controlling shareholder or Director and their close associates held interests in any business competing with the Group's business[95] Share Option Scheme and Post-Reporting Period Events The Company has a share option scheme, but no options have been granted, exercised, cancelled, or lapsed since the listing date up to the reporting date; post-reporting period events include changes in directors, and the Audit Committee has reviewed the interim financial statements - The Company adopted a share option scheme on June 10, 2020, but no share options have been granted, exercised, cancelled, or lapsed from the listing date up to the date of this report[96] - Post-reporting period director changes occurred: Li Xia resigned as executive director, Ms. Zhou Wenqi and Mr. Zhang Weixian were appointed as executive directors (July 18, 2025); Mr. Wang Yifan resigned as executive director (August 6, 2025)[97][98] - The Audit Committee has reviewed the Group's unaudited condensed consolidated financial statements for the six months ended June 30, 2025, and deemed them compliant with applicable accounting standards and GEM Listing Rules[99]