帝王实业控股(01950) - 2025 - 中期业绩

Corporate Information This section provides an overview of the company's governance structure, including board members, committees, and other essential corporate details Board of Directors This section lists the Board of Directors of Emperor Industries Holdings Limited, including executive and independent non-executive directors, and discloses recent changes in directorship - Mr. Zhong Wenlong was appointed as an executive director on August 1, 2025[6][7] - Mr. Zhang Jiawei resigned as an executive director on July 31, 2025[6][7] Committees This section details the composition of the Audit, Nomination, and Remuneration Committees, all chaired by independent non-executive directors - The chairmen of the Audit, Nomination, and Remuneration Committees are all Mr. Li Changyue[6][7] - The Audit Committee comprises four independent non-executive directors[6][7] Other Corporate Details This section provides basic information such as the company's authorized representatives, independent auditor, principal bankers, website, stock code, registered office, and share registrar - The company's stock code is 1950[9][10] - The company's website is **www.dwhl1950.com**[9](index=9&type=chunk)[10] - The independent auditor is Zhongrui Hexin Certified Public Accountants Limited[9][10] Management Discussion and Analysis This section reviews the company's financial performance, operational highlights, future outlook, liquidity, capital structure, and human resources for the reporting period Business Review For the six months ended June 30, 2025, Emperor Industries Holdings Limited experienced a decrease in both revenue and net profit, primarily operating in faux leather chemicals and Chinese liquor businesses Faux Leather Chemicals Business Revenue from faux leather chemicals decreased by 6.6% to RMB 113,104,000, while gross profit margin improved due to lower raw material costs Faux Leather Chemicals Business Performance | Indicator | For the six months ended June 30, 2025 (RMB thousands) | For the six months ended June 30, 2024 (RMB thousands) | Year-on-year Change | | :--- | :--- | :--- | :--- | | Revenue | 113,104 | 121,034 | -6.6% | | Gross Profit | 26,137 | 23,551 | +11.0% | | Gross Profit Margin | 23.1% | 19.5% | +3.6 percentage points | | Selling and Distribution Expenses | 7,942 | 6,596 | +20.4% | | Segment Profit | 4,951 | 4,199 | +17.9% | - The increase in gross profit margin was primarily due to the overall decrease in raw material costs during the period[23][28] Chinese Liquor Business Chinese liquor business revenue decreased by 12.3% to RMB 149,785,000, with a significant decline in segment profit due to increased selling and distribution expenses Chinese Liquor Business Performance | Indicator | For the six months ended June 30, 2025 (RMB thousands) | For the six months ended June 30, 2024 (RMB thousands) | Year-on-year Change | | :--- | :--- | :--- | :--- | | Segment Revenue | 149,785 | 170,795 | -12.3% | | Gross Profit | 99,940 | 116,111 | -14.0% | | Selling and Distribution Expenses as % of Segment Revenue | 56.5% | 54.0% | +2.5 percentage points | | Segment Profit | 11,350 | 19,817 | -42.7% | - The company promotes its Chinese liquor products through advertising on platforms like airports, railway stations, and online media, as well as by organizing tasting events and liquor exhibitions[27][29] Group's Key Financial Indicators for H1 2025 | Indicator | For the six months ended June 30, 2025 (RMB thousands) | For the six months ended June 30, 2024 (RMB thousands) | Year-on-year Change | | :--- | :--- | :--- | :--- | | Revenue | 262,889 | 291,829 | -9.9% | | Gross Profit | 126,076 | 139,662 | -9.7% | | Net Profit | 15,334 | 20,530 | -25.3% | | Basic and Diluted Earnings Per Share | 1.93 cents | 2.85 cents | -32.3% | - Net profit decreased primarily due to increased selling and distribution expenses[16] - The Group primarily engages in the faux leather chemicals business and the Chinese liquor business[17][21] Prospects Despite global economic uncertainties, China's economy is expected to recover in 2025, prompting the Group to adjust its strategic goals to enhance market share through management, R&D, product diversification, and geographical expansion - China's economy is expected to recover in 2025, with government-directed stimulus measures and growing consumer spending supporting retail sales growth[32][35] - The Group is adjusting its strategic objectives to increase market share through management initiatives, enhanced R&D capabilities, diversified product lines, and geographical expansion[33][35] - The Chinese liquor business has repositioned its products under proprietary brands "Di Huang Chi" and "Di Long Chi" and established production partnerships with Huaxing Liquor and Datang Liquor[34][36] - A strategic cooperation framework agreement was signed with Shanghai Jiuyue Youpin Commercial Management Co., Ltd. in August 2025 to jointly expand liquor and other food sales, aiming to establish a joint venture[37][42] Interim Dividend The Board of Directors does not recommend the payment of any interim dividend for the six months ended June 30, 2025 - The Board does not recommend the payment of any interim dividend for the current period[39][43] Liquidity and Capital Resources As of June 30, 2025, the Group's current assets were approximately RMB 652,560,000 and current liabilities were approximately RMB 213,407,000, resulting in a decrease in the current ratio from 3.58 times to 3.06 times, with a significant increase in the gearing ratio Gearing Ratio As of June 30, 2025, the Group's gearing ratio significantly increased to 5.14% from 1.01% as of December 31, 2024 Gearing Ratio | Date | Gearing Ratio | | :--- | :--- | | June 30, 2025 | 5.14% | | December 31, 2024 | 1.01% | Capital Expenditures During the reporting period, the Group's capital expenditures amounted to approximately RMB 12,049,000, primarily for the purchase of plant and equipment, a significant decrease from the prior year Capital Expenditures | Period | Amount (RMB thousands) | | :--- | :--- | | For the six months ended June 30, 2025 | 12,049 | | For the six months ended June 30, 2024 | 39,842 | Capital Commitments As of June 30, 2025, capital commitments not provided for in the condensed consolidated financial statements amounted to RMB 813,000, mainly for the purchase of plant and machinery and automation contracts, a decrease from year-end Capital Commitments | Date | Amount (RMB thousands) | | :--- | :--- | | June 30, 2025 | 813 | | December 31, 2024 | 1,451 | Liquidity Status | Indicator | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Current Assets | 652,560 | 557,411 | | Current Liabilities | 213,407 | 155,653 | | Current Ratio | 3.06 times | 3.58 times | - As of June 30, 2025, bank borrowings amounted to approximately RMB 66,500,000, all bearing interest at floating rates[41][44] Capital Structure As of June 30, 2025, the company's issued ordinary shares totaled 720,000,000, with an authorized share capital of US$5,000,000, divided into 2,000,000,000 shares of US$0.0025 each, consistent with the prior year-end Share Scheme The company adopted a share option scheme on February 10, 2020, with a maximum of 20,000,000 share options available for grant after share consolidation, with no options granted or authorization limit updated since adoption - The total number of share options available for grant under the share option scheme does not exceed 20,000,000 shares[56][61] - Since the adoption date of the share option scheme, the authorized limit has not been updated, and no share options have been granted[57][61] - As of June 30, 2025, the number of issued ordinary shares was 720,000,000[49][55] - The authorized share capital is US$5,000,000, divided into 2,000,000,000 shares of US$0.0025 each[49][55] Investments As of June 30, 2025, the Group's total carrying value of investments in shares of companies listed on the Stock Exchange decreased to approximately RMB 4,339,000, with realized fair value losses and unrealized fair value gains recorded during the period Total Investment in Listed Securities | Date | Amount (RMB thousands) | | :--- | :--- | | June 30, 2025 | 4,339 | | December 31, 2024 | 5,972 | Investment Performance (For the six months ended June 30, 2025) | Indicator | Amount (RMB thousands) | | :--- | :--- | | Realized fair value loss | (305) | | Unrealized fair value gain | 174 | | Dividends received | 255 | - The Board expects the stock market to remain volatile in the coming year, and the Group will continue to adopt prudent measures when making investment decisions in securities trading[66][68] Contingent Liabilities As of June 30, 2025, the Group had no significant hire purchase commitments, contingent liabilities, guarantees, or lawsuits against it - As of June 30, 2025, the Group recorded no significant hire purchase commitments, contingent liabilities, guarantees, or lawsuits against it[70][75] Foreign Exchange Risk and Management The Group's sales and purchases are primarily denominated in RMB, with some foreign currency funds in HKD; the company is exploring measures to manage foreign exchange risk but has not entered into any hedging instruments as of June 30, 2025 - The Group's sales and purchases are primarily denominated in RMB, with some foreign currency funds denominated in HKD[71][76] - The company is exploring and discussing measures to address foreign exchange risk, but as of June 30, 2025, no financial instruments have been entered into for foreign exchange hedging[71][76] Human Resources As of June 30, 2025, the Group had approximately 202 employees, offering competitive remuneration and benefits, and participating in social security schemes in China and MPF in Hong Kong - As of June 30, 2025, the Group had approximately 202 employees[72][77] - The Group participates in various local government-managed social security schemes for its employees in China and is a member of the Mandatory Provident Fund Scheme for its employees in Hong Kong[73][77] Sufficiency of Public Float The company has maintained the public float as required by the Listing Rules at all times during the reporting period - During the reporting period, the company consistently maintained the public float required by the Listing Rules[74][78] Corporate Governance and Other Data This section details the company's adherence to corporate governance principles, directors' and substantial shareholders' interests, and other relevant post-reporting period events Corporate Governance The company has adopted the Corporate Governance Code but has deviations due to the absence of a chairman since May 25, 2022, affecting the segregation of duties and reporting lines - The company has strictly complied with the Corporate Governance Code from the listing date to the report date, with the following deviations: non-segregation of duties for Chairman and CEO, company secretary reporting to executive directors, and AGM chaired by an executive director[80][81][82][86] - The company has been without a chairman since the resignation of the former chairman, Ms. Liu Jing, on May 25, 2022[81] Purchase, Sale or Redemption of the Company's Listed Securities During the reporting period, neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities - Neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities during the period[83][87] Compliance with the Model Code for Securities Transactions by Directors Following specific inquiries to all directors, the company confirms that all directors have complied with the Model Code for Securities Transactions by Directors during the reporting period - All directors have complied with the required standards set out in the Model Code during the period[84][88] Events After the Reporting Period Except as disclosed in this report, there have been no significant events after the review period and up to the date of this report that could materially affect the Group's operations and financial performance - Except as disclosed in this report, there have been no significant events after the review period and up to the date of this report that could materially affect the Group's operations and financial performance[85][89] Directors' and Chief Executive's Interests and Short Positions in Shares, Underlying Shares and Debentures As of June 30, 2025, Executive Director Mr. Chen Hua held a 0.83% long position in shares through controlled corporations and spouse's interests, while Independent Non-Executive Director Mr. Huang Zhenming held a 0.56% long position Directors' Shareholdings | Name | Capacity/Nature of Interest | Number of Shares | Long/Short Position | Approximate Percentage of the Company's Shareholding | | :--- | :--- | :--- | :--- | :--- | | Mr. Chen Hua | Interest in controlled corporation and spouse's interest | 6,000,800 | Long Position | 0.83% | | Mr. Huang Zhenming | Beneficial owner | 4,000,000 | Long Position | 0.56% | - Mr. Chen Hua indirectly holds share interests through Sunlight Global Investment Limited and Lilian Global Investment Limited, wholly owned by his spouse, Ms. Liu Jing[93][94][95][97] Substantial Shareholders' Interests and Short Positions in Shares and Underlying Shares As of June 30, 2025, apart from the directors and chief executive, Ms. Zheng Xiuyue was a substantial shareholder, holding a long position of 52,000,000 shares, representing 7.22% of the company's shareholding Substantial Shareholders' Shareholdings | Name | Capacity/Nature of Interest | Number of Shares | Long/Short Position | Approximate Percentage of the Company's Shareholding | | :--- | :--- | :--- | :--- | :--- | | Ms. Zheng Xiuyue | Beneficial owner | 52,000,000 | Long Position | 7.22% | Directors' Interests in Competing Business At no time during the reporting period did any director or their close associates have an interest in any business that directly or indirectly competes or might have competed with the Group's business - No director or their close associates had any interest in any business that competes with the Group's business during the period[104][108] Interests of Directors (and their Connected Entities) in Material Transactions, Arrangements or Contracts At year-end or at any time during the reporting period, no director or entity connected with a director had a material interest in any significant transaction, arrangement, or contract entered into by the company, its holding company, or any of its subsidiaries - No director or their connected entities had a material interest in any significant transaction, arrangement, or contract entered into by the company, its holding company, or any subsidiary during the period[101][105][109] Audit Committee As of June 30, 2025, the Audit Committee members are all independent non-executive directors, having reviewed the interim financial report and key accounting policies, though the condensed consolidated interim financial report for this period is unaudited - The Audit Committee members include Mr. Li Changyue (Chairman), Mr. Ou Xijing, Mr. Huang Zhenming, and Ms. Zhou Xiaochun, all of whom are independent non-executive directors[102][106] - The Audit Committee has reviewed the interim financial report and discussed internal controls, financial reporting matters, and the key accounting standards and policies adopted by the company[102][107] - The condensed consolidated interim financial report for this period is unaudited[103][107] Update on Directors' Information Subsequent to the reporting period, Mr. Zhang Jiawei resigned as an executive director, and Mr. Zhong Wenlong was appointed as an executive director, effective August 1, 2025 - Mr. Zhang Jiawei has resigned as an executive director[110][111] - Mr. Zhong Wenlong has been appointed as an executive director, effective August 1, 2025[110][111] Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income For the six months ended June 30, 2025, the Group reported revenue of RMB 262,889,000, gross profit of RMB 126,076,000, and profit for the period of RMB 15,334,000, all showing a decrease compared to the prior year Key Data from Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income | Indicator | For the six months ended June 30, 2025 (RMB thousands) | For the six months ended June 30, 2024 (RMB thousands) | Year-on-year Change | | :--- | :--- | :--- | :--- | | Revenue | 262,889 | 291,829 | -9.9% | | Cost of Sales | (136,813) | (152,167) | -10.09% | | Gross Profit | 126,076 | 139,662 | -9.73% | | Other Income | 1,764 | 2,042 | -13.61% | | Other Gains and Losses | 571 | 654 | -12.7% | | Net Loss on Financial Assets at FVTPL | (131) | (3,190) | -95.89% | | Selling and Distribution Expenses | (92,591) | (98,762) | -6.35% | | Administrative and General Expenses | (17,184) | (16,630) | +3.33% | | Share of Results of an Associate | (55) | (38) | +44.74% | | Finance Costs | (960) | (519) | +84.97% | | Profit Before Tax | 17,490 | 23,219 | -24.76% | | Income Tax Expense | (2,156) | (2,689) | -19.75% | | Profit for the Period | 15,334 | 20,530 | -25.31% | | Profit Attributable to Owners of the Company | 13,908 | 20,537 | -32.3% | | Non-controlling Interests | 1,426 | (7) | Significant increase | - Net other comprehensive income for the period was RMB 434,000, compared to a loss of RMB 203,000 in the prior period, primarily from exchange differences on translating overseas operations[113] Condensed Consolidated Statement of Financial Position As of June 30, 2025, the Group's total assets were RMB 923,477,000, total liabilities were RMB 218,125,000, and total equity was RMB 705,352,000, showing increases in total assets, total liabilities, and net assets compared to December 31, 2024 Key Data from Condensed Consolidated Statement of Financial Position | Indicator | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | Change | | :--- | :--- | :--- | :--- | | Non-current Assets: | | | | | Property, Plant and Equipment | 200,277 | 194,448 | Increase | | Right-of-use Assets | 59,037 | 59,583 | Decrease | | Investment in an Associate | 6,571 | 5,426 | Increase | | Prepayments | 2,332 | 8,116 | Decrease | | Deferred Tax Assets | 2,700 | 2,700 | No Change | | Subtotal | 270,917 | 270,273 | Increase | | Current Assets: | | | | | Inventories | 61,771 | 44,677 | Increase | | Trade and Bills Receivables | 274,505 | 241,274 | Increase | | Prepayments, Deposits and Other Receivables | 234,126 | 207,287 | Increase | | Financial Assets at FVTPL | 4,339 | 5,972 | Decrease | | Pledged Bank Deposits | – | 3,475 | Decrease | | Bank Balances and Cash | 77,819 | 54,726 | Increase | | Subtotal | 652,560 | 557,411 | Increase | | Total Assets | 923,477 | 827,684 | Increase | | Current Liabilities: | | | | | Trade and Bills Payables | 82,584 | 70,282 | Increase | | Other Payables and Accruals | 15,141 | 18,618 | Decrease | | Deferred Revenue | 487 | 487 | No Change | | Amounts Due to Related Companies | 47,555 | 463 | Significant increase | | Tax Payable | 1,140 | 1,303 | Decrease | | Bank Borrowings | 66,500 | 64,500 | Increase | | Subtotal | 213,407 | 155,653 | Increase | | Non-current Liabilities: | | | | | Deferred Revenue | 4,718 | 3,287 | Increase | | Total Liabilities | 218,125 | 158,940 | Increase | | Total Equity | 705,352 | 668,744 | Increase | - The current ratio decreased from approximately 3.58 times as of December 31, 2024, to approximately 3.06 times as of June 30, 2025[40][44] Condensed Consolidated Statement of Changes in Equity For the six months ended June 30, 2025, total equity attributable to owners of the company increased from approximately RMB 644,094,000 as of January 1, 2025, to approximately RMB 654,965,000, with total comprehensive income for the period being RMB 15,768,000 Key Data from Condensed Consolidated Statement of Changes in Equity | Indicator | June 30, 2025 (RMB thousands) | January 1, 2025 (RMB thousands) | Change | | :--- | :--- | :--- | :--- | | Share Capital | 12,705 | 12,705 | No Change | | Share Premium | 458,695 | 458,695 | No Change | | Capital Reserve | 59,188 | 62,659 | Decrease | | Statutory Reserve | 22,407 | 21,837 | Increase | | Exchange Reserve | (1,924) | (2,358) | Increase | | Retained Earnings | 103,894 | 90,556 | Increase | | Total Equity Attributable to Owners of the Company | 654,965 | 644,094 | Increase | | Non-controlling Interests | 50,387 | 24,650 | Increase | | Total Equity | 705,352 | 668,744 | Increase | - During the period, the company sold a 25% equity interest in a subsidiary to a third party for a cash consideration of RMB 20,840,000, resulting in a decrease in capital reserve of RMB 3,471,000 and an increase in non-controlling interests of RMB 24,311,000[117][118] Condensed Consolidated Statement of Cash Flows For the six months ended June 30, 2025, the Group reported a net cash outflow from operating activities of RMB 23,227,000, a net cash outflow from investing activities of RMB 2,285,000, and a net cash inflow from financing activities of RMB 48,132,000, with cash and cash equivalents at period-end of RMB 77,819,000 Key Data from Condensed Consolidated Statement of Cash Flows | Indicator | For the six months ended June 30, 2025 (RMB thousands) | For the six months ended June 30, 2024 (RMB thousands) | Change | | :--- | :--- | :--- | :--- | | Net Cash (Used in)/Generated from Operating Activities | (23,227) | 8,390 | Shift from inflow to outflow | | Net Cash Used in Investing Activities | (2,285) | (40,777) | Decrease in outflow | | Net Cash Generated from Financing Activities | 48,132 | 27,484 | Increase in inflow | | Net Increase/(Decrease) in Cash and Cash Equivalents | 22,620 | (4,903) | Shift from decrease to increase | | Cash and Cash Equivalents at End of Period | 77,819 | 43,766 | Increase | - In investing activities, expenditures for the purchase of property, plant, and equipment amounted to RMB 6,265,000, a significant decrease compared to the prior period[121] - In financing activities, proceeds from bank borrowings were RMB 32,000,000, repayment of bank borrowings was RMB 30,000,000, and repayment from related companies was RMB 47,092,000[121] Notes to the Condensed Consolidated Financial Statements These notes provide additional information and explanations to the condensed consolidated financial statements, clarifying accounting policies and specific items General Information Emperor Industries Holdings Limited, incorporated in the Cayman Islands, is an investment holding company whose subsidiaries primarily manufacture and sell faux leather chemicals and Chinese liquor, with its shares listed on the HKEX since March 12, 2020, and financial statements presented in RMB - The company is an investment holding company, and its subsidiaries are primarily engaged in the manufacturing and sale of faux leather chemicals and Chinese liquor[123][127] - The company's shares were listed on the Main Board of The Stock Exchange of Hong Kong Limited on March 12, 2020[123][127] - The consolidated financial statements are presented in RMB, which is the company's presentation currency[124][127] Basis of Preparation and Principal Accounting Policies The condensed consolidated financial statements are prepared in accordance with IAS 34 and Appendix D2 of the Listing Rules, measured at historical cost except for financial assets at fair value through profit or loss, with consistent accounting policies applied as in the 2024 annual financial statements - The condensed consolidated financial statements are prepared in accordance with International Accounting Standard 34 "Interim Financial Reporting" and the applicable disclosure requirements of Appendix D2 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[125][128] - The condensed consolidated financial statements have been prepared on a historical cost basis, except for financial assets at fair value through profit or loss, which are measured at revalued amounts or fair value where applicable[126][128] - Except for additional accounting policy changes arising from the application of amended IFRSs, the accounting policies for the current period are consistent with those presented in the 2024 annual financial statements[130][133] Application of Amendments to International Financial Reporting Standards ("IFRSs") During this interim period, the Group first applied amended IFRSs, including IFRS 10 and IAS 28 (Amendments), issued by the IASB, which had no significant impact on the Group's financial performance or position - The Group has first applied IFRS 10 and IAS 28 (Amendments)[131][132] - The application of the amended IFRSs had no significant impact on the Group's condensed consolidated financial performance and position for the current and prior periods[131][132] Segment Information The Group's operating segments are primarily faux leather chemicals and Chinese liquor products, with most revenue generated from China, and segment performance detailed for both businesses Segment Revenue and Profit (For the six months ended June 30, 2025) | Segment | Revenue (RMB thousands) | Profit (RMB thousands) | | :--- | :--- | :--- | | Faux Leather Chemicals | 113,104 | 4,951 | | Chinese Liquor Products | 149,785 | 11,350 | | Total | 262,889 | 16,301 | Segment Revenue and Profit (For the six months ended June 30, 2024) | Segment | Revenue (RMB thousands) | Profit (RMB thousands) | | :--- | :--- | :--- | | Faux Leather Chemicals | 121,034 | 4,199 | | Chinese Liquor Products | 170,795 | 19,817 | | Total | 291,829 | 24,016 | Revenue by Geographical Location | Region | For the six months ended June 30, 2025 (RMB thousands) | For the six months ended June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | China | 261,150 | 289,844 | | Overseas | 1,739 | 1,985 | | Total | 262,889 | 291,829 | Revenue Revenue represents amounts received and receivable from the sale of faux leather chemicals and Chinese liquor during the period, net of discounts, sales returns, and sales-related taxes Revenue Composition | Revenue Source | For the six months ended June 30, 2025 (RMB thousands) | For the six months ended June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | Sale of faux leather chemicals | 113,104 | 121,034 | | Sale of Chinese liquor products | 149,785 | 170,795 | | Total | 262,889 | 291,829 | - Revenue is recognized at a point in time[147] Other Income For the six months ended June 30, 2025, the Group's total other income amounted to RMB 1,764,000, primarily comprising government grants, dividend income, and revenue from raw material sales, with government grants decreasing from the prior period Other Income Composition | Income Item | For the six months ended June 30, 2025 (RMB thousands) | For the six months ended June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | Bank interest income | 26 | 76 | | Dividend income | 255 | – | | Government grants | 1,210 | 1,782 | | Miscellaneous income | 40 | 18 | | Sale of raw materials | 233 | 166 | | Total | 1,764 | 2,042 | - Government grants refer to various forms of subsidies provided by local government authorities in China to compensate the Group for expenses incurred, with no unfulfilled conditions or contingencies[151][152] Other Gains and Losses For the six months ended June 30, 2025, the Group's total other gains and losses amounted to RMB 571,000, primarily derived from tax refunds and exchange gains Other Gains and Losses Composition | Item | For the six months ended June 30, 2025 (RMB thousands) | For the six months ended June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | Tax refunds | 532 | 636 | | Exchange gains | 39 | 18 | | Total | 571 | 654 | Finance Costs For the six months ended June 30, 2025, the Group's finance costs amounted to RMB 960,000, primarily consisting of interest on bank borrowings repayable within one year, an increase from the prior period Finance Costs | Item | For the six months ended June 30, 2025 (RMB thousands) | For the six months ended June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | Interest on bank borrowings | 960 | 519 | Profit Before Tax For the six months ended June 30, 2025, the Group's profit before tax decreased to RMB 17,490,000 from RMB 23,219,000 in the prior period, with key expenses including staff costs, inventory costs, R&D expenses, and depreciation Profit Before Tax and Key Expenses | Item | For the six months ended June 30, 2025 (RMB thousands) | For the six months ended June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | Profit Before Tax | 17,490 | 23,219 | | Directors' remuneration | 770 | 403 | | Staff costs (excluding directors' remuneration) | 8,478 | 9,955 | | Cost of inventories recognized as expense | 136,813 | 152,167 | | Research and development expenses | 3,914 | 4,142 | | Depreciation of property, plant and equipment | 6,220 | 5,334 | | Depreciation of right-of-use assets | 546 | 303 | | Short-term lease expenses | 571 | – | Income Tax Expenses For the six months ended June 30, 2025, the Group's income tax expense decreased to RMB 2,156,000 from RMB 2,689,000 in the prior period Income Tax Expenses | Item | For the six months ended June 30, 2025 (RMB thousands) | For the six months ended June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | China corporate income tax - Current income tax | 2,156 | 2,689 | Earnings Per Share For the six months ended June 30, 2025, basic and diluted earnings per share attributable to owners of the company decreased to RMB 1.93 cents from RMB 2.85 cents in the prior period, with a weighted average of 720,000,000 ordinary shares outstanding Earnings Per Share | Indicator | For the six months ended June 30, 2025 (RMB cents) | For the six months ended June 30, 2024 (RMB cents) | | :--- | :--- | :--- | | Basic and diluted earnings per share | 1.93 | 2.85 | - The weighted average number of ordinary shares outstanding was 720,000,000 shares[161][164] - Diluted earnings per share are the same as basic earnings per share as there were no dilutive potential ordinary shares outstanding during the period[161] Dividends The Board of Directors did not declare an interim dividend for the six months ended June 30, 2025 - The Board of Directors did not declare an interim dividend for the six months ended June 30, 2025[165][167] Property, Plant and Equipment For the six months ended June 30, 2025, the Group's cost of acquiring property, plant, and equipment was approximately RMB 12,049,000, a significant decrease from RMB 39,842,000 in the prior period Cost of Property, Plant and Equipment Acquisitions | Period | Amount (RMB thousands) | | :--- | :--- | | For the six months ended June 30, 2025 | 12,049 | | For the six months ended June 30, 2024 | 39,842 | Trade and Bills Receivables As of June 30, 2025, net trade and bills receivables increased to RMB 274,505,000 from December 31, 2024, with a portion of trade receivables over one year old and all bills receivables maturing within six months Net Trade and Bills Receivables | Indicator | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Trade receivables (net) | 237,974 | 221,166 | | Bills receivables | 36,531 | 20,108 | | Total | 274,505 | 241,274 | Ageing Analysis of Trade Receivables (June 30, 2025) | Ageing | Amount (RMB thousands) | | :--- | :--- | | Within 30 days | 43,635 | | 31 to 90 days | 75,152 | | 91 to 180 days | 82,536 | | 181 to 365 days | 21,386 | | Over 1 year | 31,188 | | Total | 253,897 | - All bills receivables have a maturity period of less than 6 months[172] Prepayments, Deposits and Other Receivables As of June 30, 2025, current prepayments, deposits, and other receivables totaled RMB 234,126,000, primarily comprising net other receivables and prepayments, with non-current prepayments of RMB 2,332,000 Current Prepayments, Deposits and Other Receivables | Item | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Other receivables (net) | 40,624 | 395 | | Other tax receivables | – | 4,831 | | Deposits | 148 | 84 | | Prepayments | 193,354 | 201,977 | | Total | 234,126 | 207,287 | - Non-current prepayments primarily relate to prepayments for property, plant, and equipment, amounting to RMB 2,332,000[174] Financial Assets at FVTPL As of June 30, 2025, financial assets at fair value through profit or loss primarily consisted of Hong Kong-listed equity securities totaling RMB 4,339,000, a decrease from December 31, 2024, and classified as current assets due to management's expectation of realization within twelve months Financial Assets at FVTPL | Item | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Hong Kong-listed equity securities | 4,339 | 5,972 | - Listed equity securities are classified as current assets because management expects to realize these financial assets within twelve months after the reporting period[177] Trade and Bills Payables As of June 30, 2025, total trade and bills payables increased to RMB 82,584,000 from December 31, 2024, with an average credit period of 30 to 90 days for trade payables and all bills payables maturing within six months Trade and Bills Payables | Indicator | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Trade payables | 60,544 | 41,586 | | Bills payables | 22,040 | 28,696 | | Total | 82,584 | 70,282 | Ageing Analysis of Trade Payables (June 30, 2025) | Ageing | Amount (RMB thousands) | | :--- | :--- | | Within 30 days | 30,906 | | 31 to 90 days | 15,028 | | 91 to 180 days | 9,484 | | 181 to 365 days | 4,272 | | Over 1 year | 854 | | Total | 60,544 | - All bills payables have a maturity period of less than 6 months[182] Other Payables and Accruals As of June 30, 2025, total other payables and accruals decreased to RMB 15,141,000 from December 31, 2024, primarily including accrued staff costs, accrued expenses, other payables, other tax payables, and contract liabilities Other Payables and Accruals | Item | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Accrued staff costs | 1,884 | 3,276 | | Accrued expenses and other payables | 10,188 | 10,586 | | Other tax payables | 274 | 1,841 | | Contract liabilities | 2,795 | 2,915 | | Total | 15,141 | 18,618 | Bank Borrowings During this interim period, the Group incurred new bank loans of RMB 32,000,000 and repaid RMB 30,000,000, with total bank borrowings of RMB 66,500,000 as of June 30, 2025, all bearing floating interest rates and secured by certain right-of-use assets - New bank loans of RMB 32,000,000 were incurred during the period[185] - As of June 30, 2025, total bank borrowings amounted to RMB 66,500,000, all bearing interest at floating rates[41][185] - Bank borrowings are secured by certain right-of-use assets with a net book value of approximately RMB 15,031,000[185] Share Capital As of June 30, 2025, the company's authorized share capital was US$5,000,000, divided into 2,000,000,000 ordinary shares of US$0.0025 each, with 720,000,000 issued and fully paid shares totaling RMB 12,705,000, consistent with December 31, 2024 - The authorized share capital is US$5,000,000, divided into 2,000,000,000 ordinary shares of US$0.0025 each[188] - The issued and fully paid share capital consists of 720,000,000 shares, totaling RMB 12,705,000[188] Material Related Parties Transactions During the reporting period, the Group conducted sales of faux leather chemicals to related party Hangzhou Shenlan Biomaterials Co., Ltd. amounting to RMB 2,235,000, and key management personnel compensation totaled RMB 1,551,000 Related Party Sales | Transacting Party | Transaction Content | For the six months ended June 30, 2025 (RMB thousands) | For the six months ended June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | :--- | | Hangzhou Shenlan Biomaterials Co., Ltd. | Sale of faux leather chemicals | 2,235 | 1,393 | Key Management Personnel Compensation | Item | For the six months ended June 30, 2025 (RMB thousands) | For the six months ended June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | Salaries, allowances and benefits in kind | 1,493 | 2,798 | | Contributions to retirement benefit schemes | 58 | 44 | | Total | 1,551 | 2,842 | Commitments As of June 30, 2025, the Group's capital commitments contracted but not provided for amounted to RMB 813,000, primarily for the purchase of property, plant, and equipment Capital Commitments | Item | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Contracted but not provided for - Purchase of property, plant and equipment | 813 | 1,451 | Fair Value Measurements of Financial Instruments This section presents the Group's financial instruments measured at fair value at the end of the reporting period, including financial assets at FVTPL (HK-listed equity securities) and financial assets at FVOCI (bills receivables), classified into a three-level fair value hierarchy, with no transfers between levels or changes in valuation techniques during the period Fair Value Hierarchy Classification (June 30, 2025) | Item | Level 1 (RMB thousands) | Level 2 (RMB thousands) | Level 3 (RMB thousands) | Total (RMB thousands) | | :--- | :--- | :--- | :--- | :--- | | Financial assets at FVTPL (Listed equity securities) | 4,339 | – | – | 4,339 | | Financial assets at FVOCI (Bills receivables) | – | 36,531 | – | 36,531 | Fair Value Hierarchy Classification (December 31, 2024) | Item | Level 1 (RMB thousands) | Level 2 (RMB thousands) | Level 3 (RMB thousands) | Total (RMB thousands) | | :--- | :--- | :--- | :--- | :--- | | Financial assets at FVTPL (Listed equity securities) | 5,972 | – | – | 5,972 | | Financial assets at FVOCI (Bills receivables) | – | 20,108 | – | 20,108 | - There were no transfers between fair value hierarchy levels or changes in valuation techniques for financial instruments measured at fair value during the period[201][202]