通通AI社交(00628) - 2025 - 中期业绩

Summary The company reported a significant 233.4% revenue increase, but profit before tax and profit for the period declined sharply, while profit attributable to owners rose 26.1% with no interim dividend recommended Overview of Core Financial Indicators (For the six months ended June 30, 2025) | Indicator | H1 2025 (thousand RMB) | H1 2024 (thousand RMB) | Change | Change % | | :--- | :--- | :--- | :--- | :--- | | Revenue | 202,700 | 60,800 | +141,900 | +233.4% | | Profit Before Tax | 7,000 | 33,600 | -26,600 | -79.2% | | Profit for the Period | 2,500 | 25,400 | -22,900 | -90.2% | | Profit Attributable to Owners of the Company | 31,900 | 25,300 | +6,600 | +26.1% | | Basic Earnings Per Share | RMB 0.61 cents | RMB 0.89 cents | -0.28 cents | -31.5% | - The Board does not recommend the payment of any interim dividend for the current interim period, consistent with the corresponding period[5] Unaudited Condensed Consolidated Financial Statements Condensed Consolidated Statement of Profit or Loss Revenue for the period surged by 233.4% to 202,677 thousand RMB, but profit before tax and profit for the period significantly decreased, primarily due to a sharp rise in administrative and marketing expenses; however, profit attributable to owners of the company increased by 26.1% Key Data from Condensed Consolidated Statement of Profit or Loss (thousand RMB) | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Revenue | 202,677 | 60,804 | | Other Income and Other Gains and Losses | 17,553 | (3,631) | | Administrative Expenses | (89,595) | (15,847) | | Marketing Expenses | (119,338) | (5,849) | | Profit Before Tax | 7,018 | 33,596 | | Profit for the Period | 2,546 | 25,388 | | Profit Attributable to Owners of the Company | 31,876 | 25,275 | | Basic Earnings Per Share | RMB 0.61 cents | RMB 0.89 cents | Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income Profit for the period significantly decreased, and due to exchange differences from functional currency translation and overseas operations, total comprehensive expense for the period was 16,886 thousand RMB, compared to comprehensive income of 33,613 thousand RMB in the prior period Key Data from Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (thousand RMB) | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Profit for the Period | 2,546 | 25,388 | | Exchange Differences Arising from Translation of Functional Currency to Presentation Currency | (17,192) | 7,499 | | Exchange Differences Arising from Translation of Overseas Operations | (2,240) | 726 | | Total Comprehensive (Expense) / Income for the Period | (16,886) | 33,613 | | Total Comprehensive (Expense) / Income Attributable to Owners of the Company | 14,558 | 32,975 | Condensed Consolidated Statement of Financial Position As of June 30, 2025, the Group's total assets slightly increased, with a significant rise in intangible assets within non-current assets, while current liabilities surged, leading to a slight decrease in net current assets and total equity Key Data from Condensed Consolidated Statement of Financial Position (thousand RMB) | Indicator | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Non-Current Assets | 1,168,042 | 1,125,393 | | Total Current Assets | 1,509,133 | 1,482,098 | | Total Current Liabilities | 143,759 | 81,587 | | Net Current Assets | 1,365,374 | 1,400,511 | | Total Assets Less Current Liabilities | 2,533,416 | 2,525,904 | | Total Non-Current Liabilities | 87,790 | 60,837 | | Total Equity | 2,445,626 | 2,465,067 | - Intangible assets increased from 286,695 thousand RMB as of December 31, 2024, to 323,958 thousand RMB as of June 30, 2025, primarily due to business combinations and other intangible asset expenditures[8][32] - Contract liabilities significantly increased from 10,154 thousand RMB as of December 31, 2024, to 43,361 thousand RMB as of June 30, 2025, mainly from subscription revenue, financial information service revenue, and digital content service revenue[8][41] Notes to the Unaudited Condensed Consolidated Financial Statements 1 Company Information and Basis of Preparation The company is incorporated in Bermuda and listed on the HKEX, primarily engaged in investment holding, with subsidiaries covering digital internet platforms, digital content ecosystems, and FinTech services; financial statements are presented in RMB, prepared in accordance with HKAS 34 and Listing Rules - The Company's principal business is investment holding, with subsidiaries engaged in digital internet platform business, digital content ecosystem business, and FinTech services[10] - The condensed consolidated financial statements are presented in RMB and prepared in accordance with Hong Kong Accounting Standard 34 and the applicable disclosure requirements of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[10][11] 2 Accounting Policies The condensed consolidated financial statements are prepared on a historical cost basis, with the first-time application of revised HKFRS accounting standards in the current period having no significant impact on financial position or performance; digital content service revenue is recognized using a time-based output method, proportional to the contract period - New and revised Hong Kong Financial Reporting Standards accounting standards applied in the current interim period have no significant impact on the Group's financial position and performance[13] - Digital content service revenue, such as platform-based digital marketing services, is recognized using a time-based output method, proportional to the contract period (typically one to three months)[14] 3 Segment Operating Information The Group updated its segment reporting from March 18, 2025, to better reflect its latest business strategy, now comprising three reportable segments: Digital Internet Platform Business, Digital Content Ecosystem Business, and FinTech Services Business; the Digital Content Ecosystem Business contributes the most revenue, but the Digital Internet Platform Business incurred significant losses - As of March 18, 2025, the Group's segment reporting has been updated to include Digital Internet Platform Business, Digital Content Ecosystem Business, and FinTech Services Business[16] H1 2025 Segment Revenue and Results (thousand RMB) | Segment | Revenue from External Customers | Segment Results | | :--- | :--- | :--- | | Digital Internet Platform Business | 11,923 | (42,488) | | Digital Content Ecosystem Business | 131,074 | 2,835 | | FinTech Services Business | 59,680 | 39,589 | | Total | 202,677 | (64) | - In H1 2025, the Digital Content Ecosystem Business was the primary source of revenue, the FinTech Services Business contributed most of the segment results, while the Digital Internet Platform Business recorded a significant loss[19] Segment Assets and Liabilities (thousand RMB) | Segment | Segment Assets as of June 30, 2025 | Segment Liabilities as of June 30, 2025 | | :--- | :--- | :--- | | Digital Internet Platform Business | 122,317 | 164,523 | | Digital Content Ecosystem Business | 779,434 | 42,963 | | FinTech Services Business | 1,355,994 | 8,752 | | Total | 2,257,745 | 216,238 | 4 Revenue, Other Income and Other Gains and Losses Revenue for the period significantly increased to 202,677 thousand RMB, primarily driven by advertising services, top-up services, and subscription revenue; other income decreased, but a significant increase in exchange gains offset some losses Revenue Source Analysis (thousand RMB) | Revenue Category | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Interest Income from Accounts Receivable Factoring Loans | 40,123 | 39,172 | | Advertising Service Income | 41,719 | 255 | | Top-up Service Income | 88,200 | 5,718 | | Subscription Income | 11,923 | – | | Digital Content Service Income | 1,155 | – | | Financial Information Service Income | 19,557 | 15,659 | | Total Revenue | 202,677 | 60,804 | Other Income and Gains/Losses (thousand RMB) | Category | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Bank Interest Income | 766 | 2,973 | | Bargain Purchase Gain | 37 | – | | Exchange Gains / (Losses) | 16,709 | (6,978) | | Total | 17,553 | (3,631) | 5 Profit Before Tax Profit before tax significantly decreased, mainly due to a substantial increase in employee benefit expenses, depreciation of right-of-use assets, and amortization of intangible assets Profit Before Tax Deductions (thousand RMB) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Employee Benefit Expenses | 50,950 | 7,498 | | Depreciation of Property, Plant and Equipment | 194 | – | | Depreciation of Right-of-Use Assets | 4,065 | 580 | | Amortization of Intangible Assets | 14,549 | – | 6 Finance Costs Finance costs significantly increased from 7 thousand RMB to 2,169 thousand RMB, primarily due to higher interest expenses on borrowings Finance Costs Analysis (thousand RMB) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Interest Expense on Borrowings | 1,950 | – | | Interest Expense on Lease Liabilities | 219 | 7 | | Total | 2,169 | 7 | 7 Income Tax Expense Income tax expense decreased from 8,208 thousand RMB to 4,472 thousand RMB, mainly due to a reduction in China corporate income tax - The Group did not generate taxable profits in Hong Kong, and estimated taxable profits generated in mainland China are provided at a tax rate of 25%[26] Income Tax Expense Analysis (thousand RMB) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Current Tax – China Corporate Income Tax | 3,992 | 7,749 | | Deferred Tax | 480 | 459 | | Total Tax Expense for the Period | 4,472 | 8,208 | 8 Dividends The Board does not recommend the payment of any interim dividend for the current interim period, consistent with the prior year - The Board does not recommend the payment of any interim dividend for the six months ended June 30, 2025[28] 9 Earnings Per Share Basic earnings per share decreased from RMB 0.89 cents to RMB 0.61 cents, despite an increase in profit attributable to owners of the company, due to a significant increase in the weighted average number of ordinary shares outstanding Basis for Basic Earnings Per Share Calculation | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Profit Attributable to Ordinary Equity Holders of the Company for Basic EPS Calculation (thousand RMB) | 31,876 | 25,275 | | Weighted Average Number of Ordinary Shares Outstanding (thousand shares) | 5,201,123 | 2,838,486 | | Basic Earnings Per Share | RMB 0.61 cents | RMB 0.89 cents | - Diluted earnings per share are not presented as the Company had no dilutive potential ordinary shares during the interim period[30] 10 Right-of-Use Assets and Intangible Assets Both right-of-use assets and intangible assets significantly increased during the period due to business combinations and new lease agreements; intangible assets primarily include mobile software and technology, amortized on a straight-line basis over five years - For the six months ended June 30, 2025, the Group acquired 1,224 thousand RMB in right-of-use assets through business combinations and recognized 8,618 thousand RMB in right-of-use assets due to renewals and new lease agreements[31] - For the six months ended June 30, 2025, the Group acquired 4,079 thousand RMB in intangible assets through business combinations and incurred 48,447 thousand RMB in other intangible asset expenditures; intangible assets include mobile software and technology, amortized on a straight-line basis over five years[32] 11 Trade and Loan Receivables Total trade and loan receivables increased to 1,401,150 thousand RMB, primarily driven by commercial factoring loans receivable; the aging structure of trade receivables shows a high proportion of short-term receivables, and all receivables and loans are neither past due nor credit-impaired Overview of Trade and Loan Receivables (thousand RMB) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Commercial Factoring Loans Receivable | 1,346,054 | 1,281,656 | | Trade Receivables | 72,148 | 59,309 | | Provision for Expected Credit Losses | (17,052) | (14,944) | | Total | 1,401,150 | 1,326,021 | - Commercial factoring loans receivable have terms ranging from 90 to 360 days, with effective interest rates between 6% and 7.5% per annum; as of the reporting period end, all commercial factoring loans receivable were not yet due[33] Aging Analysis of Trade Receivables (thousand RMB) | Aging | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | 0 to 30 days | 29,693 | 57,449 | | 31 to 60 days | 18,102 | 1,278 | | 61 to 90 days | 18,146 | 386 | | Over 90 days | 6,207 | 196 | - As of June 30, 2025, and December 31, 2024, none of the Group's trade and loan receivables were credit-impaired[34] 12 Prepayments, Deposits and Other Receivables Total prepayments amounted to 403,006 thousand RMB, with the majority arising from the acquisition of Tianjin Guanchuang Meitong E-commerce Co., Ltd., which is still pending approval; Mr. Huang Guangyu has provided a personal guarantee for the recoverability of the prepayments, and management believes no further impairment is needed Overview of Prepayments, Deposits and Other Receivables (thousand RMB) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Prepayments Arising from Acquisition of Tianjin Guanchuang | 576,000 | 576,000 | | Impairment Loss | (208,000) | (208,000) | | Total Carrying Amount | 403,006 | 393,592 | - Prepayments of 576,000 thousand RMB for the acquisition of Tianjin Guanchuang are pending approval from the People's Bank of China, and the change of actual controller has not yet been completed[37] - Mr. Huang Guangyu has provided a personal guarantee, committing to make up any shortfall by December 31, 2026, if the transaction cannot be completed and the funds cannot be recovered[38] - Management believes the recoverable amount of prepayments is higher than their carrying amount, and no impairment of prepayments needs to be recognized in profit or loss[39] 13 Trade Payables Trade payables increased to 37,867 thousand RMB, primarily due within 30 days, with an average credit period of 60 days; the Group ensures all payables are settled within their credit terms Aging Analysis of Trade Payables (thousand RMB) | Aging | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | 0 to 30 days | 23,942 | 23,484 | | 31 to 60 days | 11,943 | – | | 61 to 90 days | 959 | – | | Over 90 days | 1,023 | 68 | | Total | 37,867 | 23,552 | - Trade payables are non-interest bearing, with an average credit period of 60 days, and the Group ensures all payables are settled within their credit terms[40] 14 Contract Liabilities Contract liabilities significantly increased to 43,361 thousand RMB, primarily from advance payments related to subscription revenue, financial information service revenue, and digital content service revenue Sources of Contract Liabilities (thousand RMB) | Source | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Subscription Income | 34,338 | 9,712 | | Financial Information Service Income | 633 | 442 | | Digital Content Service Income | 8,390 | – | | Total | 43,361 | 10,154 | - Contract liabilities represent proceeds received in advance from customers related to subscription revenue, financial information service revenue, and digital content service revenue, expected to be settled within the normal operating cycle[41] 15 Borrowings Total borrowings increased to 84,315 thousand RMB, mainly from loans from independent third parties and additional borrowings acquired through business combinations, all unsecured and incurring finance costs at an annual interest rate of 6% - Borrowing balances include principal amounts of 70,737 thousand RMB from independent third parties (2024: 55,128 thousand RMB), incurring finance costs at an annual interest rate of 6%, repayable in 2027[43] - Additional loan principal of 7,586 thousand RMB was acquired through business combinations, incurring finance costs at an annual interest rate of 6%, repayable in 2028[43] - All borrowings are unsecured by any of the Group's assets or guarantees[43] 16 Share Capital The company's issued share capital remained unchanged during the interim period at 5,201,123 thousand shares, amounting to 45,824 thousand RMB; a capital reorganization was completed in June 2024, involving capital reduction and share subdivision, and new shares were issued due to subsidiary acquisitions Issued and Fully Paid Share Capital (thousand shares/thousand HKD) | Item | Number of Shares (thousand shares) | Amount (thousand HKD) | | :--- | :--- | :--- | | As of January 1, 2024 | 2,701,123 | 230,159 | | Capital Reduction | – | (207,143) | | Shares Issued upon Acquisition of Subsidiaries | 2,500,000 | 22,808 | | As of June 30, 2025 | 5,201,123 | 45,824 | - A capital reorganization was completed on June 21, 2024, including the reduction of par value per share from HK$0.1 to HK$0.01 and the subdivision of unissued shares[44][46] - Following the capital reorganization, the issuance of 2,500,000,000 ordinary shares due to subsidiary acquisitions resulted in credits of 22,808 thousand RMB to the share capital account and 499,495 thousand RMB to the share premium account, respectively[46] 17 Contingent Liabilities As of June 30, 2025, and December 31, 2024, the Group had no significant contingent liabilities - The Group had no significant contingent liabilities at the end of the reporting period[45] Management Discussion and Analysis Overview The Group accelerated its digital transformation and business diversification by deepening its "Technology + Finance" integrated internet strategy, achieving a 233.4% revenue increase to 202,700 thousand RMB, primarily driven by the acquisitions of CashBox and Beijing Liheng Group; despite a decline in profit before tax, profit attributable to owners of the company increased due to non-controlling interests absorbing losses, and the Group will continue to develop its digital internet ecosystem business for multi-domain synergy - The Group is primarily engaged in Digital Internet Platform Business, Digital Content Ecosystem Business, and FinTech Services Business[47] - Revenue for the interim period significantly increased by 233.4% to 202,700 thousand RMB, mainly attributable to the acquisitions of CashBox Group Technology (Hong Kong) Limited (129,900 thousand RMB) and Beijing Liheng Group (11,900 thousand RMB), as well as the steady growth of commercial factoring and other financial services businesses[48][49] - Profit before tax significantly decreased by 79.2% to 7,000 thousand RMB, primarily due to a substantial increase in staff costs (43,500 thousand RMB) and amortization of intangible assets (14,500 thousand RMB) resulting from Beijing Liheng Group's business expansion, partially offset by increased exchange gains[48][49] - Profit attributable to owners of the company increased to 31,900 thousand RMB, mainly because a significant portion of Beijing Liheng Group's losses was borne by non-controlling interests[50] - The Group successfully expanded into internet social and digital content domains through the Beijing Liheng contractual arrangement, Beijing Yiheng contractual arrangement, and Beijing Jiayu contractual arrangement[51][52][53] Industry Environment In H1 2025, the Hong Kong capital market recovered, China's economy grew steadily, and policies continued to promote inclusive and technology-driven finance; the financial services sector transformed through regulation and technology integration, with deepening blockchain applications; the internet industry accelerated "quality leap" with AI large models empowering various sectors, and Web3.0-AI convergence fostering decentralized ecosystems; in the digital content ecosystem, games and short dramas saw explosive growth, with China's overseas micro-short drama market growing nearly fourfold year-on-year - In H1 2025, China's economy showed a "generally stable, structurally differentiated" trend, with policies continuously promoting the development of inclusive finance and FinTech[57] - The financial services industry accelerated its digital transformation, with blockchain technology enabling full-process traceability in supply chain finance, and Hong Kong laying the foundation for cross-border payments through the "Stablecoin Bill"[58] - The internet industry accelerated its transformation towards a "quality leap," with policies promoting the "AI+" initiative, AI large models empowering various industries, and the convergence of Web3.0 and AI fostering decentralized ecosystems[58] - In the digital content ecosystem, games and short dramas became core growth engines; China's micro-short drama market size is estimated to reach 63.43 billion RMB in 2025, with the number of overseas market applications growing nearly fourfold year-on-year[59][60] Business Review The Group expanded its digital content ecosystem business through the acquisitions of CashBox and Beijing Yiheng Group, showing strong performance in game development and publishing and gaining market attention for short drama production; the digital internet platform business developed social commerce platforms and commercial ecosystem collaboration platforms through the acquisitions of Beijing Liheng Group and Beijing Jiayu Group, with over 1.8 million registered users; the FinTech services business maintained stable growth in commercial factoring and other financial services revenue Digital Content Ecosystem Business The Group successfully expanded its digital content ecosystem business through the acquisitions of CashBox and Beijing Yiheng Group; CashBox demonstrated strong performance in game development and publishing, having developed and released over 500 games and recorded 129,900 thousand RMB in revenue; Beijing Yiheng Group focuses on producing high-quality short dramas, collaborating deeply with multiple platforms, and recorded 1,200 thousand RMB in revenue - The Group acquired CashBox and Beijing Yiheng Group between June 2024 and March 2025 to achieve business diversification[61] - CashBox has developed and released over 500 games, with users in 100+ countries, recording revenue of 129,900 thousand RMB[62] - Beijing Yiheng Group focuses on the high-quality short drama segment, collaborating deeply with platforms such as Hongguo Short Drama, iQiyi Micro-Short Drama, and Douyin, recording revenue of 1,200 thousand RMB[63] Digital Internet Platform Business The Group expanded its digital internet platform business through the acquisitions of Beijing Liheng Group and Beijing Jiayu Group, including social commerce platforms and commercial ecosystem collaboration platforms; Beijing Liheng Group's "Tongtong APP" and "Lehuo Universe App" have accumulated over 1.8 million registered users, with approximately 65,000 paying users, generating 11,900 thousand RMB in revenue; Beijing Jiayu Group focuses on cross-merchant asset interoperability and has achieved ecosystem integration with "Tongtong APP" - The Group acquired Beijing Liheng Group through the Beijing Liheng contractual arrangement, focusing on social networking, artificial intelligence, e-commerce, information technology services, and technology research and development[64] - Beijing Liheng Group's platforms have accumulated over 1,800,000 registered users, of whom approximately 65,000 users have paid for subscriptions, generating revenue of 11,900 thousand RMB[67] - The Group completed the acquisition of Beijing Jiayu Group through the Beijing Jiayu contractual arrangement, focusing on cross-merchant asset interoperability and achieving ecosystem integration with the Tongtong APP[69] FinTech Services Business The Group's FinTech services business includes commercial factoring and other financial services; commercial factoring loan amounts increased to 1,028,100 thousand RMB, with revenue rising to 40,100 thousand RMB and stable segment results; other financial services revenue increased to 19,600 thousand RMB, primarily due to business promotion efforts - Commercial factoring loan amounts increased to 1,028,100 thousand RMB, with revenue increasing to 40,100 thousand RMB, and segment results of 34,400 thousand RMB[71] - The interest rate charged to commercial factoring borrowers slightly decreased, ranging from 6.0% to 7.5%, consistent with market rates[71] - Other financial services revenue increased to 19,600 thousand RMB, primarily due to enhanced business promotion efforts[72] Financial Review The Group's revenue significantly increased by 233.4% to 202,700 thousand RMB, primarily driven by the acquisitions of CashBox and Beijing Liheng Group; however, a surge in administrative and marketing expenses led to a substantial decline in profit before tax; business segment performance was mixed, with the Digital Content Ecosystem Business contributing the most revenue, the FinTech Services Business showing stable growth, and the Digital Internet Platform Business incurring losses due to expansion; the credit risk management system is robust, with a 0% non-performing loan ratio Performance Summary Revenue for the interim period significantly increased by 233.4% to 202,700 thousand RMB, mainly from the CashBox acquisition (129,900 thousand RMB), Beijing Liheng Group acquisition (11,900 thousand RMB), and FinTech services business expansion; profit before tax decreased to 7,000 thousand RMB, primarily affected by increased staff costs, intangible asset amortization, and marketing expenses; despite this, profit attributable to owners of the company grew due to non-controlling interests absorbing losses - Revenue significantly increased by 233.4% to 202,700 thousand RMB, primarily from the CashBox acquisition (129,900 thousand RMB), Beijing Liheng Group acquisition (11,900 thousand RMB), and FinTech services business expansion[73][74] - Other income (bank interest income) decreased to 800 thousand RMB, but exchange gains of 16,700 thousand RMB arose from the appreciation of RMB against HKD[75] - Administrative expenses increased by 73,800 thousand RMB to 89,600 thousand RMB, mainly due to staff costs (increase of 43,500 thousand RMB), intangible asset amortization (increase of 14,500 thousand RMB), and increased service fees[76] - Marketing expenses increased to 119,300 thousand RMB, primarily comprising advertising and promotion expenses, technical service fees, etc., from CashBox, Beijing Liheng Group, and Beijing Yiheng Group[77] - Finance costs increased to 2,200 thousand RMB, mainly related to non-bank borrowings of Beijing Liheng Group[78] - Profit attributable to owners of the company increased to 31,900 thousand RMB, mainly because a significant portion of Beijing Liheng Group's substantial losses was borne by non-controlling interests[79] Digital Content Ecosystem Business Segment Analysis Total revenue for the Digital Content Ecosystem Business significantly increased to 131,074 thousand RMB, primarily contributed by CashBox's online advertising and top-up services, as well as Beijing Yiheng Group's digital content service revenue; net operating expenses increased significantly, but the segment still recorded a profit Digital Content Ecosystem Business Operating Results (thousand RMB) | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Total Revenue | 131,074 | 5,973 | | Net Operating Expenses | (128,137) | (5,801) | | Segment Results | 2,835 | 172 | - CashBox's online advertising services and top-up services accounted for 31.8% and 67.3%, respectively, of the Digital Content Ecosystem Business's total revenue[81] - Beijing Yiheng Group's digital content service revenue was 1,200 thousand RMB[81] Digital Internet Platform Business Segment Analysis The Digital Internet Platform Business generated 11,923 thousand RMB in revenue, but due to increased R&D, personnel, and marketing costs from Beijing Liheng Group's business expansion, the segment recorded a significant loss of 53,809 thousand RMB Digital Internet Platform Business Operating Results (thousand RMB) | Indicator | H1 2025 | | :--- | :--- | | Revenue | 11,923 | | Net Operating Expenses | (65,732) | | Segment Results (excluding inter-segment transactions) | (53,809) | - The segment recorded a significant loss due to increased R&D, personnel, and related costs from Beijing Liheng Group's expanded business scope, while products are not yet fully mature[84] FinTech Services Business Segment Analysis FinTech services business revenue grew steadily, with commercial factoring business revenue increasing to 40,123 thousand RMB and segment results of 34,430 thousand RMB; other financial services revenue increased to 19,557 thousand RMB, with segment results of 16,480 thousand RMB; the total loan return rate decreased, but the non-performing loan ratio remained 0%, indicating robust risk management Commercial Factoring Business Operating Results (thousand RMB) | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Revenue | 40,123 | 39,172 | | Net Operating Expenses | (3,685) | (3,072) | | Segment Results (excluding inter-segment transactions) | 34,430 | 34,226 | Other Financial Services Business Operating Results (thousand RMB) | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Revenue | 19,557 | 15,659 | | Net Operating Expenses | (3,077) | (2,249) | | Segment Results (excluding inter-segment transactions) | 16,480 | 13,410 | Key Indicators for Commercial Factoring Business | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Total Loan Return (Revenue as % of Average Total Loan Balance) | 6.12% | 7.16% | | Loan Loss Provision Ratio (Impairment Provision as % of Total Loan Balance) | 1.22% | 1.14% | | Non-Performing Loan Ratio | 0.00% | 0.00% | - The decrease in total loan return is mainly due to the People's Bank of China continuously lowering the Loan Prime Rate, leading the Group to also adjust its commercial factoring loan interest rates to align with market conditions[92] - The non-performing loan ratio remained at 0%, and the provision coverage ratio remained above 100% or was not applicable, indicating that provisions fully cover the total balance of all non-performing loans[93] Provision for Expected Credit Losses During the interim period, a provision for expected credit losses of 2,000 thousand RMB was made for commercial factoring business and 100 thousand RMB for game development and publishing business; the total provision at period-end increased to 17,052 thousand RMB Changes in Provision for Expected Credit Losses on Trade and Loan Receivables (thousand RMB) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | As of January 1 | 14,944 | 11,473 | | Impairment Provision Recognized | 10,733 | 7,710 | | Reversal of Impairment Loss | (8,625) | (5,836) | | As of June 30 | 17,052 | 13,347 | Credit Policy and Credit Approval Procedures The Group has established stringent credit policies and approval procedures, including due diligence by the business department, review and analysis by the risk audit department, and approval by the Credit Review Committee; the finance department is responsible for signing, disbursing, and collecting payments, with standard collection procedures in place to ensure loan quality and risk control - The Group has established credit policies and approval procedures, including due diligence by the business department, review and analysis by the risk audit department, and approval by the Credit Review Committee[95][96][97] - The finance department is responsible for loan signing, disbursement, and collection, with standard collection and recovery procedures in place, allowing for legal action against borrowers with overdue or delinquent repayments[98][99] - Commercial factoring loans have credit terms ranging from 90 to 360 days, with effective annual interest rates between 6.0% and 7.5%; during the interim period, no trade and loan receivables from commercial factoring services business were overdue[100][102] Assessment of Equity Value Corresponding to Prepayments Arising from Acquisitions The Group prepaid 576,000 thousand RMB to OPCO for the acquisition of Tianjin Guanchuang, but the transaction is delayed due to pending approval from the People's Bank of China; Mr. Huang Guangyu has provided a personal guarantee to cover any shortfall if the transaction fails; management believes Tianjin Guanchuang is crucial for the Group's business development and will continue to pursue approvals, with no further impairment of prepayments currently deemed necessary - The Group has prepaid 576,000 thousand RMB for the acquisition of 100% equity interest in Tianjin Guanchuang Meitong E-commerce Co., Ltd., but the transaction has not yet received approval from the People's Bank of China[103] - Mr. Huang Guangyu has provided a personal guarantee, committing to make up any shortfall to the Group with his personal assets by December 31, 2026, if the transaction ultimately cannot be completed and the funds cannot be recovered[106] - Management believes Tianjin Guanchuang will bring more development opportunities and synergies to the Group and will continue to actively pursue approval procedures; currently, the estimated recoverable amount of prepayments is higher than their carrying amount, and no further impairment is needed[105][107] Outlook The Group will continue to strengthen its technological empowerment and risk control capabilities, exploring new paths for integrated "Technology + Finance" development; in terms of business layout, it will focus on innovations in financial services such as cross-border payments, promote the international expansion of its digital internet business, and deepen the synergy among its three major business segments—FinTech services, digital content ecosystem, and digital internet platform—to address challenges and achieve steady growth - The Group will continue to strengthen its technological empowerment and risk control capabilities, exploring new paths for integrated "Technology + Finance" development[108] - In terms of business layout, the Group will focus on innovation opportunities in financial services such as cross-border payments, explore enhancing the efficiency of cross-border capital flows through technological upgrades, and timely promote the international expansion of its digital internet business[109] - The Group will deepen the synergy among its three major business segments: FinTech services, digital content ecosystem, and digital internet platform, strengthening risk identification and technical safeguards, and improving operational compliance to lay a solid foundation for steady growth in the second half of the year[109] Liquidity and Financial Resources Liquidity and Financial Resources The Group maintains a sound financial position, but cash and cash equivalents decreased to 73,000 thousand RMB, primarily due to business expansion costs of Beijing Liheng Group and an increase in commercial factoring loan scale; the current ratio decreased to 10.5, and the debt-to-asset ratio increased to 9.15% - The Group's total equity was 2,445,600 thousand RMB, and cash and cash equivalents decreased to 73,000 thousand RMB[110] - The decrease in cash balance was mainly due to increased R&D, personnel, and related costs from Beijing Liheng Group's business expansion, as well as an increase in the scale of commercial factoring loans[110] Cash Flow Overview (thousand RMB) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Cash Outflow from Operating Activities | (9,100) | (89,100) | | Cash Outflow from Investing Activities | (47,600) | (7,700) | | Cash Inflow from Financing Activities | 14,600 | (700) | Liquidity Ratios | Indicator | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Current Ratio | 10.5 | 18.2 | | Debt-to-Asset Ratio | 9.15% | 5.25% | Capital Structure Capital Structure The company's issued share capital remained unchanged during the interim period, maintaining 5,201,123,120 shares - The number of issued ordinary shares of the Company remained at 5,201,123,120 shares as of June 30, 2025[113] Significant Acquisitions and Disposals of Subsidiaries, Associates and Joint Ventures Significant Acquisitions and Disposals of Subsidiaries, Associates and Joint Ventures Apart from the Beijing Yiheng contractual arrangement and Beijing Jiayu contractual arrangement, the Group had no other significant acquisitions or disposals of subsidiaries, associates, or joint ventures during the interim period - Apart from the Beijing Yiheng contractual arrangement and Beijing Jiayu contractual arrangement, the Group had no other significant acquisitions or disposals of subsidiaries, associates, or joint ventures during the interim period[114] Material Investments Material Investments As of June 30, 2025, the Group had no material investments - As of June 30, 2025, the Group had no material investments[115] Pledge of Assets and Contingent Liabilities Pledge of Assets and Contingent Liabilities As of June 30, 2025, the Group had no pledged assets or significant contingent liabilities - As of June 30, 2025, the Group had no pledged assets or significant contingent liabilities[116] Treasury Policy and Foreign Exchange Risk Treasury Policy and Foreign Exchange Risk The Group adopts a prudent treasury policy, closely monitoring its liquidity position and customer financial conditions; all bank deposits are in HKD, RMB, and USD; the Group has not adopted any hedging policy but will continue to monitor foreign exchange risk and consider hedging measures when necessary - The Group adopts a prudent treasury policy, with all bank deposits held in HKD, RMB, and USD[117] - The Group has not adopted any hedging policy, but the executive directors and management will continue to monitor foreign exchange risk and consider hedging measures when necessary[117] Staff and Remuneration Staff and Remuneration As of June 30, 2025, the Group's total number of employees increased to 630; employee remuneration (excluding directors and chief executive) for the interim period was 50,300 thousand RMB, and staff training was conducted in a timely manner - As of June 30, 2025, the Group employed a total of 630 staff (December 31, 2024: 381 staff)[118] - Employee remuneration (excluding remuneration for directors and chief executive) for the interim period was 50,300 thousand RMB (corresponding period: 6,500 thousand RMB)[118] - The Group pays social insurance and mandatory provident fund contributions for employees in accordance with applicable laws in China and Hong Kong, and conducts relevant staff training in a timely manner[118] Interim Dividend Interim Dividend The directors do not recommend the payment of any interim dividend for the current interim period, consistent with the prior year - The directors do not recommend the payment of any interim dividend for the current interim period[119] Compliance with Corporate Governance Code Compliance with Corporate Governance Code The company has complied with the Corporate Governance Code during the interim period, except for the unseparated roles of Chairman and Chief Executive; the Chief Executive's role is performed by the Operating Management Committee, and the Board will review and consider appointing a suitable candidate - The Company has complied with the Corporate Governance Code throughout the interim period, except that the roles of Chairman and Chief Executive are not separated[120] - The role of Chief Executive is performed by the Operating Management Committee (comprising executive directors), and the Board will review and consider appointing a suitable candidate from time to time[121] Standard Securities Dealing Code for Directors Standard Securities Dealing Code for Directors Upon inquiry with all directors, it is confirmed that they have complied with the Standard Code as set out in Appendix C3 of the Listing Rules throughout the interim period - All directors confirmed compliance with the Standard Code as set out in Appendix C3 of the Listing Rules throughout the interim period[122] Purchase, Redemption or Sale of the Company's Listed Securities Purchase, Redemption or Sale of the Company's Listed Securities Neither the company nor any of its subsidiaries purchased, redeemed, or sold any of the company's listed securities during the interim period, nor did they hold any treasury shares - Neither the Company nor any of its subsidiaries purchased, redeemed, or sold any of the Company's listed securities during the interim period, nor did they hold any treasury shares[123] Audit Committee Audit Committee The Audit Committee comprises four members, including three independent non-executive directors and one non-executive director, with Chairman Mr. Mak Yau Kee possessing appropriate financial and accounting professional qualifications; the committee has reviewed the Group's unaudited interim results for the current interim period - The Audit Committee comprises four members, including three independent non-executive directors and one non-executive director, with Chairman Mr. Mak Yau Kee possessing appropriate financial and accounting professional qualifications[124] - The Audit Committee met with management on August 27, 2025, to review accounting standards and practices and the Group's unaudited interim results for the current interim period[124] Publication of Financial Information Publication of Financial Information This results announcement has been published on the HKEX website and the company's website, and the interim report containing all information will be available for viewing at the appropriate time - This results announcement has been published on the HKEX website (www.hkexnews.hk) and the Company's website (www.00628.hk.com)[125](index=125&type=chunk) - The Company's interim report for the current interim period, containing all information required by the Listing Rules, will be available for viewing on the aforementioned websites at the appropriate time[125]