建业地产(00832) - 2025 - 中期业绩

Financial Summary This section summarizes key financial performance indicators for the six months ended June 30, 2025, showing revenue and profit declines but a narrowed loss As of June 30, 2025, for the Six Months Ended Financial Summary | Metric | June 30, 2025 (CNY) | June 30, 2024 (CNY) | Change | | :--- | :--- | :--- | :--- | | Revenue | CNY 6.575 billion | CNY 7.243 billion | Decreased 9.2% | | Gross Profit | CNY 542 million | CNY 684 million | Decreased 20.8% | | Gross Profit Margin | 8.2% | 9.4% | Decreased 1.2 percentage points | | Loss attributable to owners of the Company | CNY 1.277 billion | CNY 2.609 billion | Loss narrowed | | Loss for the Period | CNY 1.318 billion | CNY 2.826 billion | Loss narrowed | | Basic Loss Per Share | CNY 43.29 cents | CNY 88.45 cents | Loss narrowed | Interim Results This section presents the condensed consolidated income statement and statement of financial position, highlighting key financial performance and position Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income For the six months ended June 30, 2025, the Group's revenue decreased by 9.2% to CNY 6.575 billion, gross profit decreased by 20.8% to CNY 542 million, and loss for the period significantly narrowed by 53.3% to CNY 1.318 billion, driven by substantial reductions in net other losses, inventory write-downs, selling and marketing expenses, general and administrative expenses, impairment losses, finance costs, and income tax Key Data from Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income | Metric | June 30, 2025 (CNY thousand) | June 30, 2024 (CNY thousand) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 6,574,793 | 7,243,098 | -9.2% | | Cost of Sales | (6,032,984) | (6,558,788) | -8.0% | | Gross Profit | 541,809 | 684,310 | -20.8% | | Net Other Losses | (168,358) | (773,927) | -78.2% | | Inventory Write-downs | (362,559) | (898,094) | -59.6% | | Selling and Marketing Expenses | (193,514) | (208,381) | -7.1% | | General and Administrative Expenses | (275,496) | (334,123) | -17.6% | | Impairment Losses on Trade and Other Receivables and Contract Assets | (213,269) | (310,479) | -31.3% | | Finance Costs | (398,608) | (515,381) | -22.7% | | Loss Before Tax | (1,097,171) | (2,503,727) | -56.2% | | Income Tax | (220,395) | (322,588) | -31.7% | | Loss for the Period | (1,317,566) | (2,826,315) | -53.3% | | Loss Attributable to Owners of the Company | (1,277,203) | (2,609,388) | -51.1% | | Basic Loss Per Share (CNY cents) | (43.29) | (88.45) | -51.0% | Condensed Consolidated Statement of Financial Position As of June 30, 2025, the Group's total non-current assets were CNY 16.937 billion, total current assets were CNY 83.343 billion, net current liabilities were CNY 20.000 billion, and net liabilities were CNY 6.707 billion, indicating persistent liquidity pressure Key Data from Condensed Consolidated Statement of Financial Position | Metric | June 30, 2025 (CNY thousand) | December 31, 2024 (CNY thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Total Non-current Assets | 16,936,776 | 17,566,884 | -3.6% | | Total Current Assets | 83,342,799 | 87,330,239 | -4.6% | | Total Current Liabilities | (103,343,086) | (106,316,667) | -2.8% | | Net Current Liabilities | (20,000,287) | (18,986,428) | +5.3% | | Total Assets Less Current Liabilities | (3,063,511) | (1,419,544) | +115.8% | | Total Non-current Liabilities | (3,643,836) | (3,967,057) | -8.2% | | Net Liabilities | (6,707,347) | (5,386,601) | +24.5% | | Total Deficit Attributable to Owners of the Company | (7,439,536) | (6,151,221) | +20.9% | Notes to the Condensed Consolidated Financial Statements This section provides detailed notes on the financial statements, covering preparation basis, accounting policies, revenue, expenses, and financial position items 1 Basis of Preparation The Group's financial statements for the six months ended June 30, 2025, are prepared in accordance with HKAS 34 and the Listing Rules, facing significant going concern uncertainties including net loss, substantial net current liabilities, maturing debt, a depressed property market, and offshore debt defaults, with the Board actively pursuing debt restructuring and liquidity improvement measures whose success remains uncertain - The Group incurred a net loss of CNY 1.318 billion for the six months ended June 30, 2025[12] - As of June 30, 2025, the Group had net current liabilities of CNY 20.000 billion and net liabilities of CNY 6.707 billion[12] - Bank and other loans of CNY 7.110 billion and offshore senior notes of CNY 14.146 billion are due within the next twelve months, while cash and cash equivalents amounted to only CNY 288 million[12] - The property market remains depressed, with a significant decline in pre-sales, and the Henan market's recovery will take time, leading to short-term business pressure[12] - The Company announced a suspension of payments to all offshore creditors on June 23, 2023, and is currently undergoing an offshore debt restructuring plan[13] - The debt restructuring plan includes seeking a comprehensive solution, negotiating loan renewals with lenders, accelerating property sales and collections, strictly controlling costs, limiting capital expenditures, and resolving outstanding litigations[13][14] - The Board believes that, assuming successful implementation of all plans, the Group will have sufficient working capital for continued operation, but multiple significant uncertainties remain regarding their achievement[14][15] 2 Principal Accounting Policies The condensed consolidated financial statements are prepared on a historical cost basis, with certain assets and liabilities measured at fair value, and the first-time application of HKAS 21 (Amendment) "Lack of Exchangeability" did not result in significant accounting policy changes - The condensed consolidated financial statements are prepared on a historical cost basis, except for investment properties, debt and equity securities investments, derivative financial instruments, and biological assets, which are measured at fair value[16][18] - HKAS 21 (Amendment) "Lack of Exchangeability" was first applied in this interim period but did not result in significant changes to accounting policies or financial position[17] 3 Revenue and Segment Reporting The Group's principal businesses are property development, property leasing, and hotel operations; for the six months ended June 30, 2025, total revenue decreased by 9.2% year-over-year to CNY 6.575 billion, with property sales revenue down 12.2% and hotel operations revenue down 4.0%, and the Group operates in a single segment with revenue and operating profit primarily derived from China Revenue from Contracts with Customers by Major Product or Service Line | Revenue Source | June 30, 2025 (CNY thousand) | June 30, 2024 (CNY thousand) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Property Sales | 5,941,183 | 6,769,445 | -12.2% | | Revenue from Hotel Operations | 162,014 | 168,750 | -4.0% | | Others | 445,505 | 275,323 | +61.8% | | Total Revenue from Contracts with Customers | 6,548,702 | 7,213,518 | -9.2% | | Rental Income from Investment Properties | 20,566 | 26,056 | -21.1% | | Rental Income from Properties Held for Sale | 5,525 | 3,524 | +56.8% | | Total Revenue from Other Sources | 26,091 | 29,580 | -11.8% | | Total Revenue | 6,574,793 | 7,243,098 | -9.2% | - The Group operates in a single operating segment, primarily relying on property development performance, with revenue and operating profit mainly derived from China[23][24] 4 Other Income and Net Other Losses For the six months ended June 30, 2025, the Group's other income increased by 79.6% year-over-year to CNY 9.663 million, primarily driven by increased government grants, while net other losses significantly decreased by 78.2% to CNY 168 million, mainly due to the absence of a substantial goodwill impairment loss present in the prior period Other Income and Net Other Losses | Item | June 30, 2025 (CNY thousand) | June 30, 2024 (CNY thousand) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Other Income | | | | | Government Grants | 7,917 | 3,046 | +159.9% | | Interest Income | 704 | 2,237 | -68.5% | | Others | 1,042 | 97 | +974.2% | | Total Other Income | 9,663 | 5,380 | +79.6% | | Net Other Losses | | | | | Goodwill Impairment Loss | – | (610,244) | -100.0% | | Accrued Penalties | (136,128) | (149,726) | -9.1% | | Net Gain/(Loss) on Disposal of Subsidiaries | 7,190 | (3,857) | N/A | | Fair Value Change of Biological Assets Less Costs to Sell | (11,125) | 3,603 | N/A | | Others | (28,291) | (11,721) | +141.4% | | Total Net Other Losses | (168,358) | (773,927) | -78.2% | 5 Loss Before Tax For the six months ended June 30, 2025, the Group's finance costs decreased by 22.7% year-over-year to CNY 399 million, primarily due to reduced interest on bank and other borrowings, partially offset by increased interest accrued on customer prepayments, while cost of properties sold decreased by 10.8% to CNY 5.558 billion Finance Costs and Other Items | Item | June 30, 2025 (CNY thousand) | June 30, 2024 (CNY thousand) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Interest on Bank and Other Borrowings | 936,345 | 1,076,735 | -13.0% | | Interest on Lease Liabilities | 4,198 | 6,518 | -35.6% | | Interest Accrued on Customer Prepayments | 320,172 | 255,267 | +25.4% | | Less: Interest Expenses Capitalized in Properties Under Development | (862,107) | (823,139) | +4.7% | | Finance Costs | 398,608 | 515,381 | -22.7% | | Amortization | 4,717 | 4,717 | 0.0% | | Depreciation Expense – Owned Property, Plant and Equipment | 187,101 | 196,384 | -4.7% | | Depreciation Expense – Right-of-use Assets | 3,070 | 3,194 | -3.8% | | Cost of Properties Sold | 5,557,994 | 6,230,593 | -10.8% | 6 Income Tax For the six months ended June 30, 2025, the Group's total income tax decreased by 31.7% year-over-year to CNY 220 million, primarily due to reductions in PRC corporate income tax and deferred tax, with PRC corporate income tax at 25%, land appreciation tax at progressive rates of 30% to 60%, and withholding tax at 5% to 10% Income Tax Components | Tax Category | June 30, 2025 (CNY thousand) | June 30, 2024 (CNY thousand) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Current Tax | | | | | PRC Corporate Income Tax | 103,658 | 184,095 | -43.7% | | PRC Land Appreciation Tax | 170,935 | 161,581 | +5.8% | | Total Current Tax | 274,593 | 345,676 | -20.6% | | Deferred Tax | | | | | PRC Corporate Income Tax | (71,103) | (31,760) | +123.9% | | PRC Land Appreciation Tax | 16,905 | 8,672 | +94.9% | | Total Deferred Tax | (54,198) | (23,088) | +134.7% | | Total Income Tax | 220,395 | 322,588 | -31.7% | - PRC subsidiaries are subject to Corporate Income Tax at a rate of 25%[30] - PRC Land Appreciation Tax is levied at progressive rates from 30% to 60%, with exemptions for sales of ordinary standard residential properties[31] - Hong Kong subsidiaries are subject to 5% to 10% withholding tax on dividends distributed by PRC subsidiaries and interest on intercompany balances[32] 7 Loss Per Share For the six months ended June 30, 2025, the Group's basic loss per share was CNY 43.29 cents, a significant narrowing from CNY 88.45 cents in the prior period, and diluted loss per share was the same as basic loss per share due to the anti-dilutive nature of deemed ordinary shares resulting from the loss for the period Loss Per Share | Metric | June 30, 2025 (CNY) | June 30, 2024 (CNY) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Loss Attributable to Ordinary Equity Holders of the Company | (1,277,203,000) | (2,609,388,000) | -51.1% | | Weighted Average Number of Ordinary Shares | 2,950,066,090 | 2,950,066,090 | 0.0% | | Basic Loss Per Share (CNY cents) | (43.29) | (88.45) | -51.0% | | Diluted Loss Per Share (CNY cents) | (43.29) | (88.45) | -51.0% | 8 Trade and Other Receivables As of June 30, 2025, the Group's total trade and other receivables amounted to CNY 6.546 billion, an 11.8% increase from December 31, 2024, with increases observed in other receivables, amounts due from joint ventures, associates, and non-controlling interests Trade and Other Receivables | Item | June 30, 2025 (CNY thousand) | December 31, 2024 (CNY thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Trade and Bills Receivables, Net of Loss Allowance | 165,516 | 169,590 | -2.4% | | Other Receivables | 3,017,735 | 2,406,206 | +25.4% | | Amounts Due from Joint Ventures | 548,809 | 521,334 | +5.3% | | Amounts Due from Associates | 625,510 | 600,838 | +4.1% | | Amounts Due from Entities Controlled by the Ultimate Controlling Shareholder | 264,586 | 261,943 | +1.0% | | Amounts Due from Non-controlling Interests | 1,923,692 | 1,894,525 | +1.5% | | Total | 6,545,848 | 5,854,436 | +11.8% | Ageing Analysis of Trade and Bills Receivables | Ageing | June 30, 2025 (CNY thousand) | December 31, 2024 (CNY thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Within 3 months | 38,162 | 61,291 | -37.7% | | 3 to 6 months | 16,349 | 10,193 | +60.4% | | 6 to 12 months | 25,345 | 27,229 | -6.9% | | Over 1 year | 85,660 | 70,877 | +20.9% | | Total | 165,516 | 169,590 | -2.4% | 9 Trade and Other Payables As of June 30, 2025, the Group's total trade and other payables amounted to CNY 54.362 billion, a 1.4% increase from December 31, 2024, with interest payable significantly increasing by 24.9%, while amounts due to entities controlled by the ultimate controlling shareholder and non-controlling interests decreased Trade and Other Payables | Item | June 30, 2025 (CNY thousand) | December 31, 2024 (CNY thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Trade and Bills Payables | 28,867,546 | 28,908,254 | -0.1% | | Other Payables and Accrued Expenses | 12,391,376 | 11,824,370 | +4.8% | | Interest Payable | 3,939,178 | 3,151,193 | +24.9% | | Amounts Due to Joint Ventures | 754,174 | 776,695 | -2.9% | | Amounts Due to Associates | 61,276 | 59,826 | +2.4% | | Amounts Due to Entities Controlled by the Ultimate Controlling Shareholder | 2,619,320 | 2,913,878 | -10.2% | | Amounts Due to Non-controlling Interests | 3,315,832 | 3,412,199 | -2.7% | | Amounts Due to Shareholders with Significant Influence over the Group | 780,309 | 759,863 | +2.7% | | Other Tax Payables | 1,633,258 | 1,793,457 | -8.8% | | Total | 54,362,269 | 53,599,735 | +1.4% | Ageing Analysis of Trade and Bills Payables | Ageing | June 30, 2025 (CNY thousand) | December 31, 2024 (CNY thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Within 3 months | 7,139,609 | 7,462,231 | -4.3% | | 3 to 6 months | 1,001,812 | 1,479,354 | -32.3% | | 6 to 12 months | 2,646,676 | 1,787,499 | +48.0% | | Over 12 months | 18,079,449 | 18,179,170 | -0.5% | | Total | 28,867,546 | 28,908,254 | -0.1% | 10 Dividends No dividends were payable to equity holders for either of the interim periods - No dividends were declared by the Company for the six months ended June 30, 2025, or the corresponding period in 2024[43] Management Discussion and Analysis This section provides an overview of the Group's financial performance, operational review, and market outlook Financial Review For the six months ended June 30, 2025, the Group's contracted sales decreased by 1.2% year-over-year to CNY 4.44 billion, while contracted sales area increased by 5.0%; loss attributable to owners of the Company was CNY 1.277 billion, significantly narrowed from the prior period, mainly due to reduced impairment provisions and a smaller decline in gross profit margin relative to cost expenses, with the Group's liquidity remaining under pressure, net borrowings of approximately CNY 22.702 billion, and a net gearing ratio of (338.5)% Overall Performance This section provides an overview of the Group's contracted sales, cash position, net borrowings, project deliveries, and unrecognised property sales Contracted Sales Data for the Six Months Ended June 30, 2025 | Metric | June 30, 2025 | June 30, 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Total Property Contracted Sales | CNY 4.44 billion | CNY 4.494 billion | -1.2% | | Total Contracted Sales Area | 707,896 sq.m. | 674,187 sq.m. | +5.0% | | Average Selling Price Per Square Meter | CNY 6,278 | CNY 6,679 | -6.0% | - As of June 30, 2025, total cash, cash equivalents, and restricted bank deposits were approximately CNY 1.068 billion, a decrease from CNY 1.488 billion as of December 31, 2024[44] - As of June 30, 2025, total net borrowings were approximately CNY 22.702 billion, a slight increase from CNY 22.550 billion as of December 31, 2024[44] - For the six months ended June 30, 2025, 26 property projects were delivered (2024: 54 projects), and 95 projects were under construction (2024: 143 projects)[44] - Loss attributable to owners of the Company was approximately CNY 1.277 billion, a significant narrowing from approximately CNY 2.609 billion in the prior period, mainly due to reduced impairment provisions for inventories and receivables, and the decline in recognised property revenue and gross profit margin not fully offsetting costs and expenses[45] - As of June 30, 2025, unrecognised property sales amounted to approximately CNY 24.427 billion (2024: CNY 34.464 billion), with a corresponding gross profit of approximately CNY 1.726 billion (2024: CNY 3.096 billion), expected to be recognised over the next two to three years[46] - Unrecognised property sales from joint ventures and associates amounted to approximately CNY 1.760 billion (2024: CNY 3.363 billion), with a corresponding gross profit of approximately CNY 172 million (2024: negative CNY 74 million)[46] Revenue This section details the Group's revenue performance and its drivers - The Group's revenue decreased by 9.2% from approximately CNY 7.243 billion in the prior period to approximately CNY 6.575 billion in the current period, primarily impacted by the macroeconomic downturn and a subdued property market[46] Cost of Sales This section describes the changes in the Group's cost of sales - Cost of sales decreased by 8.0% from approximately CNY 6.559 billion in the prior period to approximately CNY 6.033 billion in the current period, mainly due to a reduction in recognised area[47] Revenue from Property Sales This section focuses on the revenue generated from property sales and its contributing factors - Revenue from property sales decreased by 12.2% from approximately CNY 6.769 billion in the prior period to approximately CNY 5.941 billion in the current period[48] - Recognised area decreased by 7.3% from 1,066,183 square meters in the prior period to 988,251 square meters in the current period[48] Revenue from Hotel Operations This section details the revenue from hotel operations - Revenue from hotel operations decreased by 4.0% from approximately CNY 169 million in the prior period to approximately CNY 162 million in the current period, primarily impacted by the sluggish macroeconomic environment[48] Gross Profit This section analyzes the Group's gross profit and gross profit margin - Gross profit decreased by 20.8% from approximately CNY 684 million in the prior period to approximately CNY 542 million in the current period[49] - Gross profit margin decreased by 1.2 percentage points from 9.4% in the prior period to 8.2% in the current period[49] - Gross profit margin for property sales decreased by 1.6 percentage points from 8.0% in the prior period to 6.4% in the current period, impacted by the macroeconomic downturn and a persistently subdued property market[49] Selling and Marketing Expenses This section discusses the Group's selling and marketing expenses - Selling and marketing expenses decreased by 7.1% from approximately CNY 208 million in the prior period to approximately CNY 194 million in the current period, mainly due to a reduction of approximately CNY 12 million in advertising and promotional expenses[49] - The ratio of selling and marketing expenses to revenue was approximately 2.9% in the current period, consistent with the prior period[49] General and Administrative Expenses This section analyzes the Group's general and administrative expenses - General and administrative expenses decreased by 17.5% from approximately CNY 334 million in the prior period to approximately CNY 275 million in the current period, mainly due to reductions in depreciation and amortization, entertainment, travel and office expenses, and other miscellaneous expenses[50] - The ratio of general and administrative expenses to revenue was approximately 4.2% in the current period, a decrease from approximately 4.6% in the prior period[50] Impairment Losses on Trade and Other Receivables and Contract Assets This section details the impairment losses on receivables and contract assets - Impairment losses on trade and other receivables and contract assets for the six months ended June 30, 2025, were approximately CNY 213 million, a decrease of approximately CNY 97 million from approximately CNY 310 million in the prior period[50] Finance Costs This section analyzes the Group's finance costs - Finance costs decreased by 22.7% from approximately CNY 515 million in the prior period to approximately CNY 399 million in the current period, mainly due to a reduction of approximately CNY 117 million in interest expenses on borrowings[52] Income Tax This section discusses the Group's income tax expenses - Income tax decreased by 31.7% from approximately CNY 323 million in the prior period to approximately CNY 220 million in the current period, mainly due to reduced income tax corresponding to lower recognised property sales revenue[52] Loss for the Period This section summarizes the Group's loss for the period - Loss for the six months ended June 30, 2025, was approximately CNY 1.318 billion, a decrease of approximately CNY 1.509 billion from approximately CNY 2.826 billion in the prior period[52] Financial Resources and Utilisation This section provides an overview of the Group's cash position and dividend policy - As of June 30, 2025, cash and cash equivalents and restricted bank deposits amounted to approximately CNY 1.068 billion, a decrease from CNY 1.488 billion as of December 31, 2024[52] - The Company decided not to declare an interim dividend for the six months ended June 30, 2025[52] Borrowings and Deposit Structure This section details the Group's borrowing repayment profile and net gearing ratio Borrowing Repayment Period | Borrowing Type | Repayment Period | June 30, 2025 (CNY thousand) | December 31, 2024 (CNY thousand) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Bank Borrowings | Within one year or repayable on demand | 5,746,171 | 5,654,871 | +1.6% | | | Over one year but not exceeding two years | 1,584,349 | 1,822,483 | -13.1% | | | Over two years but not exceeding five years | 714,810 | 796,698 | -10.3% | | | Over five years | 45,900 | 45,900 | 0.0% | | Total Bank Borrowings | | 8,091,230 | 8,319,952 | -2.8% | | Other Borrowings | Within one year | 1,364,170 | 1,364,170 | 0.0% | | | Over one year but not exceeding two years | 168,390 | 168,390 | 0.0% | | Total Other Borrowings | | 1,532,560 | 1,532,560 | 0.0% | | Senior Notes | Within one year | 14,146,444 | 14,186,010 | -0.3% | | Total Senior Notes | | 14,146,444 | 14,186,010 | -0.3% | | Total Borrowings | | 23,770,234 | 24,038,522 | -1.1% | Net Borrowings and Net Gearing Ratio | Metric | June 30, 2025 (CNY thousand) | December 31, 2024 (CNY thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Total Borrowings | 23,770,234 | 24,038,522 | -1.1% | | Less: Cash and Cash Equivalents | (287,652) | (365,387) | -21.3% | | Less: Restricted Bank Deposits | (780,086) | (1,122,692) | -30.5% | | Net Borrowings | 22,702,496 | 22,550,443 | +0.7% | | Total Deficit | (6,707,347) | (5,386,601) | +24.5% | | Net Gearing Ratio (%) | (338.5)% | (418.6)% | -80.1 percentage points | Pledge of Assets This section outlines the assets pledged as collateral for borrowings - As of June 30, 2025, properties, plant and equipment, etc., with a total carrying value of approximately CNY 16.065 billion, were pledged as collateral for bank credit facilities and other loans, a decrease from CNY 17.521 billion as of December 31, 2024[54] - Properties held for sale with a total carrying value of approximately CNY 598 million were pledged as collateral for joint venture loans, an increase from CNY 424 million as of December 31, 2024[54] - Pledged properties, plant and equipment of approximately CNY 211 million served as guarantees for associate loans[54] Capital Commitments This section details the Group's capital commitments - As of June 30, 2025, contracted commitments for property development amounted to approximately CNY 4.723 billion, a decrease from CNY 5.775 billion as of December 31, 2024[55] - Other expenditures and capital investments authorized but not yet contracted amounted to approximately CNY 31.982 billion, a decrease from CNY 41.334 billion as of December 31, 2024[55] Contingent Liabilities This section outlines the Group's contingent liabilities - As of June 30, 2025, guarantees for mortgage loans provided by banks to customers amounted to approximately CNY 21.057 billion, a decrease from CNY 22.904 billion as of December 31, 2024[56] - Guarantees for bank and other loans to joint ventures and associates amounted to approximately CNY 1.509 billion, a slight decrease from CNY 1.536 billion as of December 31, 2024[56] - For the six months ended June 30, 2025, the Company made no significant investments, acquisitions, or disposals of subsidiaries, associates, and joint ventures[56] - As of the date of the interim results announcement, the Company had not received any acceleration notices for outstanding senior notes under cross-default clauses[56] Exchange Rate Risk This section describes the Group's exposure to exchange rate fluctuations - The Group's operations are primarily conducted in CNY, but it faces foreign exchange risk from HKD-denominated bank deposits and USD-denominated senior notes[56] Interest Rate Risk This section discusses the Group's exposure to interest rate changes - Some borrowings are at floating rates, and rising interest rates would increase interest costs; currently, no derivative instruments are used to hedge interest rate risk[57] Operational Review In the first half of 2025, China's economy showed stable improvement with GDP growing by 5.3% year-over-year and consumption contributing over 65%; Henan Province outperformed the national average with 5.7% GDP growth and strong industrial, consumption, and foreign trade performance; the national property market was characterized by "bottoming sales, investment pressure, and increasing differentiation," with declines in both sales area and value; Henan's property market showed a weak recovery, outperforming the national average with smaller sales declines, but still faced high inventory pressure and strained developer cash flows Macroeconomic Landscape – Economic Aspects This section provides an overview of the national and Henan provincial economic performance - In the first half of 2025, national GDP reached CNY 66.0536 trillion, growing by 5.3% year-over-year, with consumption contributing over 65% to economic growth[58] - Henan Province's GDP for the first half of the year was CNY 3.16838 trillion, growing by 5.7% year-over-year, 0.4 percentage points higher than the national growth rate[59] - Henan's economy is driven by "strengthening industrial chains, upgrading consumption, and breakthroughs in new quality productive forces," with industry leading the nation, a surge in consumption upgrades, and strong counter-trend growth in foreign trade[59] Property Market This section analyzes the national and Henan provincial property market trends and policies - In the first half of 2025, national new commercial residential sales area decreased by 3.5% year-over-year, sales value decreased by 5.5%, and real estate development investment decreased by 11.2% year-over-year[60] - Central and regulatory authorities continued to implement "stabilize the property market" policies, including de-stocking, expanding demand, new models, and risk mitigation, but market differentiation persisted[61][62] - Henan Province's real estate development investment decreased by 8.5% year-over-year, new commercial residential sales area decreased by 1.9% year-over-year, and sales value decreased by 1.3%, with its recovery strength leading the nation[63][64] - Under supply-demand coordinated policies, Henan's property market expanded "trade-in" programs, optimized provident fund policies, utilized special bonds to support existing land revitalisation and commercial housing acquisition, advanced financing coordination mechanisms, and saw a 6.9% year-over-year increase in funds available to property developers[64] - The Henan market still faces challenges and risks including unresolved high inventory pressure, strained property developer cash flows, and significant drag from the completion side[64] Market Outlook In the second half of the year, national economic growth is expected to slow but remain resilient, with policy focus shifting to implementation and new quality productive forces becoming a new growth engine; the property market will continue to stabilize, with policies fully driving effective implementation, and high-quality projects in core cities presenting structural opportunities; Henan Province is expected to maintain its "growth higher than national average" trend, with property sales decline narrowing, but inventory pressure in third and fourth-tier cities and property developer cash flow recovery still require time Macroeconomic Aspects This section provides the outlook for the national and Henan provincial economies - National economic growth is expected to slow but remain resilient in the second half, with policy focus shifting from "strong stimulus" to "implementation," and existing fiscal tools and "anti-involution" reforms being key to breaking low inflation[65] - New quality productive forces (high-tech manufacturing + digital economy) and opening up of the service sector will form new growth engines[65] - Henan Province will focus on "stabilizing employment, enterprises, markets, and expectations," promoting "four stabilities" with 36 measures including dual-wheel drive of consumption and investment, traditional industry upgrading, and cultivation of new quality productive forces[66] - With the implementation of ultra-long-term special national bonds, urban village renovation, and other projects, Henan is expected to continue its trend of "growth higher than the national average"[66] Property Market This section provides the outlook for the national and Henan provincial property markets - In the second half, governments at all levels will fully promote the effective implementation of existing policies, such as improving special bond acquisition of existing idle land and commercial housing, and increasing the use of housing coupons for urban village renovation[67] - The launch of high-quality projects is expected to drive stability in core city new home markets, but a comprehensive market stabilization still requires further policy efforts[67] - In the second half, Henan Province will thoroughly implement policies, coordinate supply and demand efforts, increase financial support, deepen "trade-in" programs, accelerate special bond acquisition, and achieve inventory revitalization and quality upgrades[68] - Henan's property market is expected to follow a "policy support → core stabilization → full-area recovery" path in the second half of 2025, with the full-year sales decline expected to narrow to within 1%[68] - The strength of investment recovery depends on the speed of existing policy effectiveness, with Zhengzhou and Luoyang leading the recovery, but inventory pressure in third and fourth-tier cities remains unresolved, and property developer cash flow recovery still requires time[68] Corporate Governance Practices This section confirms the Company's compliance with corporate governance codes and related practices - For the six months ended June 30, 2025, the Company has complied with all code provisions of Appendix C1 "Corporate Governance Code" of the HKEX Listing Rules[69] - The Company has adopted the "Model Code for Securities Transactions by Directors of Listed Issuers" in Appendix C3 of the Listing Rules and confirms that all Directors complied with the code during the period[70] - Ms. Yang Feifei and Dr. Sun Yuyang were appointed as members of the Company's Nomination Committee effective July 1, 2025[71] - For the six months ended June 30, 2025, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[72] Share Option Scheme This section provides information on the Company's share option scheme - For the six months ended June 30, 2025, the Company did not grant any share options under the Share Option Scheme, nor did it grant any options to service providers or consultants[73] - As of June 30, 2025, 112,926,256 share options were available for grant under the scheme, representing approximately 3.72% of the Company's issued share capital[73] Events After Reporting Period This section confirms the absence of significant events after the reporting period - No significant events that would materially affect the Group's operations and financial performance occurred after June 30, 2025[74] Review of Interim Results by Audit Committee This section states that the audit committee reviewed the interim results, which are unaudited - The Company's Audit Committee has discussed and reviewed the unaudited interim condensed consolidated financial statements for the six months ended June 30, 2025, with management[75] - The condensed consolidated interim results presented here have not been reviewed or audited by the Company's auditor[75] Interim Dividend This section states the decision regarding interim dividends - The Board decided not to declare an interim dividend for the six months ended June 30, 2025 (2024: nil)[76] Publication of Interim Results on HKEX and Company Websites This section informs about the publication of interim results and report - This interim results announcement has been published on the Company's website (http://www.jianye.com.cn) and the HKEX website (http://www.hkexnews.hk)[77](index=77&type=chunk) - The Company's interim report for the six months ended June 30, 2025, will be dispatched to shareholders and published on the aforementioned websites in due course[77]