华南职业教育(06913) - 2025 - 中期业绩

Financial Highlights For the six months ended June 30, 2025, revenue increased by 7.8% to RMB361,785 thousand, while gross profit and profit for the period declined, with basic EPS at RMB0.06 and a recommended interim dividend of HK2.0 cents Financial Summary for the Six Months Ended June 30 | Indicator | 2025 (RMB '000) | 2024 (RMB '000) | Change (RMB '000) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Revenue | 361,785 | 335,761 | 26,024 | +7.8 | | Cost of Sales | 238,775 | 201,790 | 36,985 | +18.3 | | Gross Profit | 123,010 | 133,971 | –10,961 | –8.2 | | Profit Before Tax | 83,613 | 84,475 | –862 | –1.0 | | Profit for the Period | 83,741 | 87,775 | –4,034 | –4.6 | | Basic & Diluted EPS | RMB0.06 | RMB0.07 | RMB–0.01 | –14.3 | - The Board recommended an interim dividend of HK2.0 cents per share for the six months ended June 30, 2025, a decrease from HK2.2 cents in the prior period[3] Unaudited Condensed Interim Consolidated Financial Statements This section presents the unaudited condensed interim consolidated statement of profit or loss and other comprehensive income and statement of financial position, detailing the Group's financial performance and position Unaudited Condensed Interim Consolidated Statement of Profit or Loss and Other Comprehensive Income For the six months ended June 30, 2025, revenue grew by 7.8%, but rising cost of sales led to an 8.2% decline in gross profit and a 4.6% decrease in profit for the period Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (For the Six Months Ended June 30) | Indicator | 2025 (RMB '000) | 2024 (RMB '000) | | :--- | :--- | :--- | | Revenue | 361,785 | 335,761 | | Cost of Sales | (238,775) | (201,790) | | Gross Profit | 123,010 | 133,971 | | Other income and gains | 33,852 | 27,832 | | Selling and distribution expenses | (13,936) | (13,438) | | Administrative expenses | (41,825) | (43,895) | | Other expenses | (12,606) | (13,992) | | Finance costs | (4,882) | (6,003) | | Profit Before Tax | 83,613 | 84,475 | | Income tax credit | 128 | 3,300 | | Profit for the Period | 83,741 | 87,775 | | Total comprehensive income for the period | 83,790 | 87,701 | | Profit attributable to owners of the parent | 83,660 | 87,722 | | Total comprehensive income attributable to owners of the parent | 83,709 | 87,648 | | Basic & Diluted EPS | RMB0.06 | RMB0.07 | - Income tax credit significantly decreased from RMB3,300 thousand in the prior period of 2024 to RMB128 thousand in the current period of 2025[4] Unaudited Condensed Interim Consolidated Statement of Financial Position As of June 30, 2025, total assets less current liabilities increased to RMB2,102,021 thousand, with net current assets turning positive, indicating improved liquidity and increased net assets Condensed Consolidated Statement of Financial Position (As of June 30) | Indicator | June 30, 2025 (RMB '000) | December 31, 2024 (RMB '000) | | :--- | :--- | :--- | | Total non-current assets | 2,096,833 | 2,109,440 | | Total current assets | 429,210 | 421,209 | | Total current liabilities | 424,022 | 598,531 | | Net current assets / (liabilities) | 5,188 | (177,322) | | Total assets less current liabilities | 2,102,021 | 1,932,118 | | Total non-current liabilities | 376,806 | 274,689 | | Net assets | 1,725,215 | 1,657,429 | | Total equity | 1,725,215 | 1,657,429 | - Net current assets improved significantly from a deficit of RMB177,322 thousand as of December 31, 2024, to a surplus of RMB5,188 thousand as of June 30, 2025[6] - Contract liabilities significantly decreased from RMB293,790 thousand as of December 31, 2024, to RMB120,861 thousand as of June 30, 2025, primarily due to the recognition of tuition and boarding fees as revenue[6] Notes to the Unaudited Condensed Interim Consolidated Financial Statements This section provides detailed notes to the interim consolidated financial statements, covering company information, accounting policies, operating segments, revenue, profit before tax, income tax, dividends, EPS, and trade receivables 1. Company and Group Information China South Vocational Education Group, incorporated in the Cayman Islands, primarily engages in investment holding and providing private higher vocational education in China - The Company was incorporated as an exempted company in the Cayman Islands on August 15, 2018[8] - The Group is principally engaged in providing private higher vocational education in the People's Republic of China[8] 2. Accounting Policies Interim financial statements are prepared under HKAS 34, consistent with annual policies, adopting HKFRS amendments effective January 1, 2025, with no significant impact 2.1 Basis of Preparation The unaudited condensed interim consolidated financial statements are prepared under HKAS 34 and presented in RMB, with all values rounded to the nearest thousand - The financial statements are prepared in accordance with HKAS 34 "Interim Financial Reporting"[9] - The financial statements are presented in RMB, with all values rounded to the nearest thousand[9] 2.2 Changes in Accounting Policies and Disclosures Accounting policies for interim financial statements are consistent with annual reports, adopting HKFRS amendments effective January 1, 2025, with no significant impact, including HKAS 21 revisions - Accounting policies are consistent with those adopted in the annual consolidated financial statements for the year ended December 31, 2024[10] - Amendments to HKFRS accounting standards effective January 1, 2025, have been adopted but had no significant impact on the Group's financial statements[10][12] - Amendments to HKAS 21 "The Effects of Changes in Foreign Exchange Rates" specify how an entity assesses currency exchangeability and determines the spot exchange rate, requiring related disclosures[11] 3. Operating Segment Information The Group operates solely in China, providing higher vocational education services, with all revenue and long-term assets originating domestically, and no single customer accounts for over 10% of total revenue - The Group is principally engaged in providing higher vocational education services in China[13] - The Group operates in a single geographical segment, with all revenue and long-term assets originating from China, thus no other geographical segment information is presented[14] - During the reporting period, no single customer accounted for 10% or more of the Group's total revenue from services rendered[15] 4. Revenue, Other Income and Gains Revenue primarily from tuition and boarding fees totaled RMB361,785 thousand, with other income and gains at RMB33,852 thousand, and contract liabilities of RMB120,861 thousand expected to be recognized within one year Analysis of Revenue, Other Income and Gains (For the Six Months Ended June 30) | Category | 2025 (RMB '000) | 2024 (RMB '000) | | :--- | :--- | :--- | | Revenue | | | | Tuition fees | 328,837 | 302,546 | | Boarding fees | 30,463 | 29,296 | | Other education service fees | 2,485 | 3,919 | | Total Revenue | 361,785 | 335,761 | | Other Income and Gains | | | | Rental income | 18,267 | 13,567 | | Training income | 7,998 | 6,653 | | Government grants | 4,249 | 3,525 | | Bank interest income | 1,995 | 1,751 | | Brand licensing income | 909 | 863 | | Total Other Income and Gains | 33,852 | 27,832 | - Tuition and boarding fees are primarily recognized over time as educational and accommodation services are provided to students (i.e., over the academic year)[16] Movement in Contract Liabilities Balance (RMB '000) | Item | For the Six Months Ended June 30, 2025 | For the Year Ended December 31, 2024 | | :--- | :--- | :--- | | At beginning of period/year | 293,790 | 234,117 | | Revenue recognized that was included in the contract liabilities balance at the beginning of the period/year | (270,530) | (232,302) | | Increase due to cash received | 205,241 | 760,377 | | Revenue recognized from performance obligations satisfied in prior periods not included in the contract liabilities balance at the beginning of the period/year | (99,252) | (466,471) | | Transferred to refund liabilities | (8,388) | (1,931) | | At end of period/year | 120,861 | 293,790 | - As of June 30, 2025, the amount of transaction price allocated to unsatisfied performance obligations expected to be recognized within one year was RMB120,861 thousand[20] 5. Profit Before Tax Profit before tax for the six months ended June 30, 2025, was RMB83,613 thousand, slightly lower than the prior period, with increased employee benefits, depreciation, and amortization, but reduced exchange losses and donations Composition of Profit Before Tax (For the Six Months Ended June 30) | Item | 2025 (RMB '000) | 2024 (RMB '000) | | :--- | :--- | :--- | | Total employee benefit expenses | 138,647 | 132,082 | | Depreciation of property, plant and equipment | 40,758 | 33,064 | | Depreciation of right-of-use assets | 16,066 | 15,453 | | Depreciation of investment properties | 965 | 965 | | Amortisation of other intangible assets | 1,554 | 1,286 | | Net exchange loss | 64 | 1,895 | | Donation expenses | 316 | 1,370 | | Bank interest income | (1,995) | (1,751) | | Government grants | (4,249) | (3,525) | - Total employee benefit expenses (excluding directors' and chief executive's emoluments) increased from RMB132,082 thousand in 2024 to RMB138,647 thousand in 2025[22] - Net exchange loss significantly decreased from RMB1,895 thousand in 2024 to RMB64 thousand in 2025[22] 6. Income Tax Income tax is calculated per jurisdiction, with exemptions for Cayman Islands and BVI, no provision for HK subsidiaries, and tax benefits for China's private non-enterprise schools, though a 25% corporate income tax may apply if registered as for-profit - The Company, incorporated in the Cayman Islands, is exempt from income tax on its operations[26] - Chinese schools remain private non-enterprise units, with academic education income treated as non-taxable income, enjoying tax preferential treatment[28] - If Chinese schools opt to register as for-profit private schools, they may be subject to a 25% corporate income tax rate on academic education services in the future[28] Income Tax (For the Six Months Ended June 30) | Item | 2025 (RMB '000) | 2024 (RMB '000) | | :--- | :--- | :--- | | Current — Mainland China expense for the period | 58 | 257 | | Deferred | (186) | (3,557) | | Total | (128) | (3,300) | 7. Dividends The Board recommended an interim dividend of HK2.0 cents per ordinary share for the six months ended June 30, 2025, totaling RMB24,321 thousand, a decrease from the prior period - The Board recommended an interim dividend of HK2.0 cents per ordinary share (2024: HK2.2 cents)[30] - The total proposed interim dividend is approximately RMB24,321 thousand (2024: RMB26,788 thousand)[30] - Final dividends declared and paid were HK1.3 cents per ordinary share (2024: HK4.8 cents), totaling RMB16,004 thousand (2024: RMB58,076 thousand)[30] 8. Earnings Per Share Attributable to Owners of the Parent Basic and diluted EPS for the six months ended June 30, 2025, was RMB0.06, calculated from RMB83,660 thousand profit attributable to owners of the parent and 1,334,000,000 weighted average shares, with no dilutive shares - Basic earnings per share is calculated based on the profit attributable to owners of the parent for the period and the weighted average of 1,334,000,000 ordinary shares outstanding during the period[31] - For the six months ended June 30, 2025 and 2024, the Group had no potentially dilutive ordinary shares issued, thus basic and diluted earnings per share are the same[32] Calculation of Basic and Diluted Earnings Per Share (For the Six Months Ended June 30) | Item | 2025 (RMB '000) | 2024 (RMB '000) | | :--- | :--- | :--- | | Profit attributable to owners of the parent | 83,660 | 87,722 | | Weighted average number of ordinary shares outstanding | 1,334,000,000 | 1,334,000,000 | 9. Trade Receivables Total trade receivables significantly decreased to RMB2,381 thousand as of June 30, 2025, from RMB9,254 thousand, with the majority falling within one year Ageing Analysis of Trade Receivables (RMB '000) | Ageing | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Within 1 year | 2,255 | 8,930 | | 1 to 2 years | 126 | 324 | | Total | 2,381 | 9,254 | - Total trade receivables decreased by approximately 74.3% from RMB9,254 thousand as of December 31, 2024, to RMB2,381 thousand as of June 30, 2025[37] Management Discussion and Analysis This section covers the Group's business review, outlook, development strategies, financial performance, liquidity, and IPO proceeds, focusing on high-quality vocational education, M&A, international cooperation, and a "five-in-one" development model Business Review The Group operates two schools in the Greater Bay Area, offering academic education, vocational training, and auxiliary services, with Lingnan Institute of Technology consolidating colleges and Lingnan Modern Technician College offering over 38 majors, serving 34,748 full-time students in 2024/2025 Principal Business The Group primarily offers academic education and vocational training services via Lingnan Institute of Technology and Lingnan Modern Technician College - The Group operates two schools in China's Greater Bay Area: Guangdong Lingnan Institute of Technology and Guangdong Lingnan Modern Technician College[38] - Lingnan Institute of Technology, established in May 2002, provides academic education and vocational training[39] - Lingnan Modern Technician College, established in July 2005, provides vocational education and training[39] Lingnan Institute of Technology Lingnan Institute of Technology, with Guangzhou and Qingyuan campuses, consolidated into 8 secondary colleges, 2 public colleges, and 1 continuing education college as of June 30, 2025, adding two new majors and offering over 40 programs - Lingnan Institute of Technology has campuses in Guangzhou and Qingyuan[40] - As of June 30, 2025, the Institute consolidated 13 secondary colleges into 8 secondary colleges, 2 public colleges, and 1 continuing education college[40] - Two new majors, Oral Medicine Technology and Optometry Technology, were added, offering over 40 majors across a wide range of disciplines[40] Lingnan Modern Technician College Lingnan Modern Technician College in Guangzhou offers over 38 majors across 8 departments, including mechatronics, drones, automotive, fire engineering, TCM, rehabilitation, nursing, advertising, computer networking, programming, and digital media - Lingnan Modern Technician College, located in Guangzhou, has 8 departments and offers over 38 majors[41] - Majors include mechatronics, drones, automotive inspection and maintenance, fire engineering, traditional Chinese medicine, rehabilitation, nursing, advertising design, computer network applications, computer programming, and digital media applications[41] Auxiliary Education Services Auxiliary education services encompass continuing education and other educational offerings, including vocational skills assessment and professional qualification preparation and training - Auxiliary education services primarily include continuing education courses and other educational services[42] - Other educational services mainly provide enrolled students with preparation and training services for vocational skills assessment and professional qualifications and certificates[42] Business Operating Data For the 2024/2025 academic year, the Group's schools had 34,748 full-time students, with average tuition and boarding fees of RMB18,065/RMB2,586 for Lingnan Institute of Technology and RMB15,023/RMB2,079 for Lingnan Modern Technician College - For the 2024/2025 academic year, the total number of full-time enrolled students in the Group's schools was 34,748[43] Average Tuition and Boarding Fees (As of June 30, 2025) | School | Average Tuition Fee (RMB) | Average Boarding Fee (RMB) | | :--- | :--- | :--- | | Lingnan Institute of Technology | 18,065 | 2,586 | | Lingnan Modern Technician College | 15,023 | 2,079 | Outlook Benefiting from national policy support for vocational education, the Group will deepen its presence in the Greater Bay Area, supplying high-skilled talent and solidifying its leading position Rising Status and Improving System of Vocational Education National policies bolster vocational education with RMB31.257 billion for quality improvement, fostering industry-education integration, establishing consortia, and optimizing the system for high-quality employment - In 2024, the central government allocated RMB31.257 billion for the Modern Vocational Education Quality Improvement Plan, focusing on enhancing teaching facilities, faculty development, and educational quality[44] - The nation promotes the creation of city-level industry-education consortia and industry communities, with 28 national-level consortia in the first batch and the launch of the "Thousand Schools, Ten Thousand Enterprises" collaborative innovation partnership program[45] - Policies mandate accelerating the construction of a modern vocational education system, promoting multi-level coordinated development with a "one body, two wings" layout, and integrating career education into higher education talent cultivation[46][47] Deep Cultivation in the Guangdong-Hong Kong-Macao Greater Bay Area, Continuously Supplying High-Skilled Talent Leveraging existing schools, the Group will expand its campus network and vocational education market in the Greater Bay Area, including academic and non-academic training, to solidify its leading position - The Guangdong-Hong Kong-Macao Greater Bay Area's economic output accounts for over 11% of the national total, with a continuously expanding talent gap in emerging industries[48] - The Group will leverage its two existing schools to expand its campus network and develop both academic and non-academic vocational education and training markets in the Greater Bay Area[48] Business Development Strategies The Group aims for performance growth through five strategies: high-quality academic vocational education, M&A for campus expansion, auxiliary education growth, international cooperation, and a "five-in-one" development model 1) High-Quality Development of Academic Vocational Education%20High-Quality%20Development%20of%20Academic%20Vocational%20Education) Lingnan Institute of Technology will pursue "Double High" construction and a big health focus, while Lingnan Modern Technician College will deepen industry-education cooperation with JD.com and seek new premises in the Greater Bay Area - Lingnan Institute of Technology aims to become an entrepreneurial vocational technical university with a big health focus within the next decade, serving as a benchmark for industry-education integration and scientific innovation in the "Big Health + TMT" sector of the Greater Bay Area[49] - Lingnan Modern Technician College collaborates with JD.com Group to establish an industry college, deepening the "industry-education-evaluation" ecosystem to achieve an "order-based class" model where students are employed upon graduation[49] - Actively seeking new school premises in the Greater Bay Area to establish branch campuses or new independent schools, expanding the campus network at the secondary vocational level[49] 2) External Mergers and Acquisitions to Expand Campus Network%20External%20Mergers%20and%20Acquisitions%20to%20Expand%20Campus%20Network) The Group will rapidly expand its network through external M&A, prioritizing high-quality technical schools and non-academic vocational training institutions in the Greater Bay Area for scale and synergy - The Group is committed to rapidly expanding its network through external mergers and acquisitions[50] - Acquisition targets will prioritize high-quality technical schools and institutions offering non-academic vocational training within the Greater Bay Area[50] 3) Expansion of Auxiliary Education Businesses%20Expansion%20of%20Auxiliary%20Education%20Businesses) The Group will expand vocational skills certification and adult continuing education, with Lingnan Modern Technician College approved for 25 trades and Lingnan Institute of Technology enhancing social training and technical services through major industry collaborations - China's vocational skills training market is projected to exceed RMB900 billion by 2025, with increasing online education penetration[51] - Lingnan Modern Technician College has been approved for vocational skills level certification in 25 trades and plans to cover prefecture-level cities in Guangdong Province within the next three years[51] - Lingnan Institute of Technology will vigorously expand cooperation with major industries, enterprises, and projects to enhance the value, economic benefits, and social recognition of its social training and technical services[51] 4) Development of International Cooperation%20Development%20of%20International%20Cooperation) The Group will actively pursue international cooperation, introducing advanced vocational education resources, exploring partnerships with overseas institutions for undergraduate upgrades, and focusing on Hong Kong, Macao, Singapore, and EU regions - The Group actively engages in international cooperation in running schools, introducing advanced vocational and basic education resources and projects[52] - Exploring partnerships with overseas institutions for upgrading to undergraduate programs, with a focus on institutions in Hong Kong, Macao, Singapore, and EU countries and regions[52] 5) "Five-in-One" New Development Pattern%20%22Five-in-One%22%20New%20Development%20Pattern) The Group will shift to a "five-in-one" development pattern driven by "academic education + vocational training + technical services," actively exploring and expanding five major businesses: large-scale training, dispatch, big health, e-commerce, and public welfare - The Group will transition from an academic education-dominated model to a "five-in-one" new development pattern driven by "academic education + vocational training + technical services"[53] - Actively exploring and expanding five major businesses: large-scale training, large-scale dispatch, big health, big e-commerce, and big public welfare[53] Financial Review For the six months ended June 30, 2025, revenue grew by 7.8% due to increased student enrollment, but a 18.3% rise in cost of sales led to decreased gross profit and margin, while profit for the period still fell by 4.6% Revenue For the six months ended June 30, 2025, revenue, primarily from tuition and boarding fees, increased by 7.8% to RMB361.8 million, driven by higher full-time student enrollment - Revenue increased by approximately 7.8% from approximately RMB335.8 million for the six months ended June 30, 2024, to approximately RMB361.8 million for the six months ended June 30, 2025[55] - The increase in revenue was primarily due to higher tuition and boarding fees resulting from an increase in the total number of full-time enrolled students during the reporting period[55] Cost of Sales Cost of sales rose by 18.3% to RMB238.8 million, mainly due to increased staff numbers and salaries, higher depreciation, cooperative education costs, and campus property management expenses - Cost of sales increased by approximately 18.3% from approximately RMB201.8 million for the six months ended June 30, 2024, to approximately RMB238.8 million for the six months ended June 30, 2025[56] - The increase was primarily due to an increase in the number of teaching staff and their average salaries, increased depreciation of property, plant and equipment, higher cooperative education costs, and increased campus property management and service expenses[56] Gross Profit and Gross Margin Gross profit decreased by 8.2% to RMB123.0 million, with gross margin falling from 39.9% to 34.0%, primarily due to increased cost of sales - Gross profit decreased by approximately 8.2% from approximately RMB134.0 million for the six months ended June 30, 2024, to approximately RMB123.0 million for the six months ended June 30, 2025[57] - Gross margin decreased from approximately 39.9% to approximately 34.0%[57] - The decrease in gross profit and gross margin was primarily due to an increase in the number of teaching staff and their average salaries, increased depreciation of property, plant and equipment, higher cooperative education costs, and increased campus property management and service expenses[57] Other Income and Gains Other income and gains increased by 21.6% to RMB33.9 million, primarily driven by higher rental income - Other income and gains increased by approximately 21.6% from approximately RMB27.8 million for the six months ended June 30, 2024, to approximately RMB33.9 million for the six months ended June 30, 2025[58] - This increase was primarily attributable to higher rental income[58] Selling and Distribution Expenses Selling and distribution expenses rose by 3.7% to RMB13.9 million, mainly due to increased promotional costs in anticipation of higher full-time student enrollment for the 2025/2026 academic year - Selling and distribution expenses increased by approximately 3.7% from approximately RMB13.4 million for the six months ended June 30, 2024, to approximately RMB13.9 million for the six months ended June 30, 2025[59] - This increase was primarily due to higher promotional expenses in anticipation of an increase in the total number of full-time enrolled students for the 2025/2026 academic year[59] Administrative Expenses Administrative expenses decreased by 4.7% to RMB41.8 million, primarily due to reduced staff costs and benefits - Administrative expenses decreased by approximately 4.7% from approximately RMB43.9 million for the six months ended June 30, 2024, to approximately RMB41.8 million for the six months ended June 30, 2025[60] - This decrease was primarily attributable to a reduction in staff costs and benefits[60] Other Expenses Other expenses decreased by 9.9% to RMB12.6 million, primarily due to reduced donations and exchange losses - Other expenses decreased by approximately 9.9% from approximately RMB14.0 million for the six months ended June 30, 2024, to approximately RMB12.6 million for the six months ended June 30, 2025[61] - This decrease was primarily attributable to a reduction in donations and exchange losses[61] Finance Costs Finance costs decreased by 18.7% to RMB4.9 million, aligning with a reduction in weighted average interest-bearing bank and other borrowings during the period - Finance costs decreased by approximately 18.7% from approximately RMB6.0 million for the six months ended June 30, 2024, to approximately RMB4.9 million for the six months ended June 30, 2025[62] - This decrease is consistent with a reduction in the weighted average interest-bearing bank and other borrowings during the reporting period[62] Profit for the Period The Group's profit for the period decreased by 4.6% year-on-year to RMB83.7 million, reflecting the combined impact of various financial factors - The Group's profit for the period decreased by approximately 4.6% from approximately RMB87.8 million for the six months ended June 30, 2024, to approximately RMB83.7 million for the six months ended June 30, 2025[63] Financial and Liquidity Position As of June 30, 2025, the Group's liquidity significantly improved with positive net current assets, while total interest-bearing borrowings reached RMB323.4 million, increasing the gearing ratio to 18.7%, with no significant contingent liabilities or pledged assets Current Assets and Current Liabilities As of June 30, 2025, net current assets improved significantly to RMB5.2 million from a RMB177.3 million deficit, driven by increased cash and reduced contract liabilities - As of June 30, 2025, the Group's net current assets were approximately RMB5.2 million, an increase of approximately 102.9% from net current liabilities of approximately RMB177.3 million as of December 31, 2024[64] - The increase in current assets was primarily due to an increase in cash and cash equivalents resulting from higher long-term borrowings[64] - The decrease in current liabilities primarily reflected a reduction in contract liabilities of approximately RMB172.9 million due to the recognition of tuition and boarding fees as revenue for the 2024/2025 academic year[64] Indebtedness As of June 30, 2025, interest-bearing bank and other borrowings totaled RMB323.4 million, denominated in RMB with annual rates from 2.6% to 6.8%, managed through internal cash flow and bank borrowings for sustainability and flexibility - As of June 30, 2025, the Group's interest-bearing bank and other borrowings were approximately RMB323.4 million, denominated in RMB[65] - Interest-bearing bank and other borrowings bear interest at effective annual rates ranging from 2.6% to 6.8%[65] Financial Assets at Fair Value Through Profit or Loss As of June 30, 2025, the Group held no financial assets at fair value through profit or loss, primarily due to the recovery of an unlisted investment in February 2025 - As of June 30, 2025, the Group had no financial assets at fair value through profit or loss (December 31, 2024: RMB0.03 million)[66] - The decrease was primarily due to the recovery of an unlisted investment in February 2025[66] Contingent Liabilities and Guarantees As of June 30, 2025, the Group had no unrecorded material contingent liabilities, guarantees, or significant litigation against any member company - As of June 30, 2025, the Group had no unrecorded material contingent liabilities, guarantees, or any significant litigation against any member of the Group[67] Pledge of Assets As of June 30, 2025, the Group had no assets pledged as security for bank loans and other borrowings - As of June 30, 2025, the Group had no assets pledged as security for bank loans and other borrowings[68] Foreign Exchange Risk The Group's revenue, most expenses, and bank balances are primarily in RMB, with no current foreign currency hedging policy, but management continuously assesses foreign exchange risk exposure - All of the Group's revenue and most expenses are denominated in RMB, and most bank balances are also in RMB[69] - The Group currently has no foreign currency hedging policy, but management will continuously assess foreign exchange risk exposure[69] Gearing Ratio The gearing ratio increased from 10.9% as of December 31, 2024, to 18.7% as of June 30, 2025, primarily due to increased interest-bearing bank and other borrowings - The gearing ratio increased from approximately 10.9% as of December 31, 2024, to approximately 18.7% as of June 30, 2025[70] - The increase was primarily due to an increase in the Group's interest-bearing bank and other borrowings[70] Employees, Remuneration Policy and Training As of June 30, 2025, the Group had 2,005 employees, with remuneration based on performance, experience, and industry practice, and a strong focus on employee training and career development - As of June 30, 2025, the Group had a total of 2,005 employees[71] - Employee remuneration is based on performance, experience, and prevailing industry practice, and is reviewed regularly[71] - The Group values employee training and career development, investing in education and training programs to enhance staff awareness of the latest industry trends and developments[71] Use of Net Proceeds from the Company's Initial Public Offering Net IPO proceeds were approximately HK$446.0 million, with HK$325.1 million (72.9%) utilized by June 30, 2025, mainly for facilities, equipment, and acquisitions, and the remaining HK$120.9 million to be deployed as planned - The net proceeds from the global offering were approximately HK$446.0 million[72] - As of June 30, 2025, HK$325.1 million of the net proceeds had been utilized, representing approximately 72.9%[72] Summary of Use of Net Proceeds (HK$ million) | Use | Intended Allocation | Amount Utilized (As of June 30, 2025) | Unutilized Amount (As of June 30, 2025) | | :--- | :--- | :--- | :--- | | Construction of new teaching and administrative facilities and purchase of teaching equipment | 272.6 | 201.8 | 70.8 | | Construction of industry-education integration industrial park | 13.4 | 4.3 | 9.1 | | Acquisition of other schools and education service providers | 115.4 | 74.4 | 41.0 | | Working capital | 44.6 | 44.6 | — | | Total | 446.0 | 325.1 | 120.9 | - There has been no change in the intended use and expected timetable for the net proceeds, and the remaining balance will be gradually utilized according to the intended uses[74] Other Information This section covers significant post-reporting events, interim dividend arrangements, share register closure, listed securities trading, material investments, future plans, corporate governance compliance, directors' securities trading, audit committee review, and interim report publication Significant Events After Reporting Period There have been no significant events of the Company requiring shareholders' attention from the end of the reporting period up to the date of this announcement - From the end of the reporting period up to the date of this announcement, there have been no significant events of the Company requiring shareholders' attention[75] Interim Dividend The Board recommended an interim dividend of HK2.0 cents per share for the six months ended June 30, 2025, payable on September 30, 2025, to shareholders on record as of September 16, 2025 - The Board has recommended an interim dividend of HK2.0 cents per share for the six months ended June 30, 2025 (June 30, 2024: HK2.2 cents)[76] - The interim dividend will be paid on September 30, 2025, to shareholders whose names appear on the Company's register of members on September 16, 2025[76] Closure of Register of Members The Company will close its register of members from September 15 to September 16, 2025, to determine interim dividend eligibility, requiring all share transfer documents by 4:30 p.m. on September 12, 2025 - The Company's register of members will be closed from Monday, September 15, 2025, to Tuesday, September 16, 2025[77] - To be eligible for the proposed interim dividend, all share transfer documents must be lodged with the Company's Hong Kong share registrar by 4:30 p.m. on Friday, September 12, 2025[77] Purchase, Sale or Redemption of the Company's Listed Securities For the six months ended June 30, 2025, neither the Company nor its subsidiaries purchased, redeemed, or sold any listed securities, and no treasury shares were held - For the six months ended June 30, 2025, neither the Company nor any of its subsidiaries purchased, redeemed, or sold any of the Company's listed securities[78] - As of June 30, 2025, the Company held no treasury shares[78] Material Investments Held, Material Acquisitions and Disposals of Subsidiaries and Affiliated Companies Except as disclosed, the Group held no material investments and made no material acquisitions or disposals of subsidiaries, associates, joint ventures, or affiliated companies during the reporting period - During the reporting period, the Group held no material investments and made no material acquisitions or disposals of subsidiaries, associates, joint ventures, or affiliated companies[79] Future Plans for Material Investments and Investment Capital Assets Except as disclosed, as of June 30, 2025, the Group had no plans for material investments or investment capital assets - As of June 30, 2025, the Group had no plans for material investments or investment capital assets[80] Corporate Governance Code The Company adopted and complied with all code provisions of the Corporate Governance Code in Appendix C1 of the Listing Rules throughout the reporting period - The Company has adopted the principles and code provisions of the Corporate Governance Code in Appendix C1 of the Listing Rules[81] - During the reporting period, the Company has complied with all code provisions in Part 2 of the Corporate Governance Code[81] Model Code for Securities Transactions by Directors The Company adopted and confirmed compliance by all directors with the Model Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix C3 of the Listing Rules for the six months ended June 30, 2025 - The Company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix C3 of the Listing Rules[82] - For the six months ended June 30, 2025, all directors have complied with the required standards set out in the Model Code[82] Audit Committee and Review of Interim Financial Information The Audit Committee, with management, reviewed the Group's accounting principles, policies, and financial reporting matters, including the unaudited consolidated results for the six months ended June 30, 2025 - The Board's Audit Committee, together with management, has reviewed the accounting principles and policies adopted by the Group and discussed financial reporting matters[83] - The Audit Committee has reviewed the Group's unaudited consolidated results for the six months ended June 30, 2025[83] Publication of Interim Results Announcement and Interim Report This interim results announcement is published on the HKEX and Company websites, and the interim report for the six months ended June 30, 2025, will be made available to shareholders and published on these sites - This interim results announcement has been published on the website of The Stock Exchange of Hong Kong Limited (www.hkexnews.hk) and the Company's website **(www.scvedugroup.com)**[84](index=84&type=chunk) - The Company's interim report for the six months ended June 30, 2025, will be made available to shareholders and published on the aforementioned websites in due course[84] Acknowledgement The Board extends sincere gratitude to the Group's management, employees, shareholders, business partners, banks, and auditors for their dedication and support throughout the reporting period - The Board expresses its sincere gratitude for the dedication and efforts of the Group's management and all employees[85] - The Board also extends its sincere gratitude for the support from the Company's shareholders, business partners, banks, and auditors throughout the reporting period[85]