乐氏国际控股(01529) - 2025 - 中期财报

Corporate Information Board of Directors and Committees This section discloses the company's board members, their committee roles, and updates on resignations and appointments - Mr. Du Yingyou resigned as an executive director on March 17, 2025[3] - Mr. Chen Guanyong resigned as an independent non-executive director and exited the audit, remuneration, and nomination committees on May 22, 2025[3][4][5] - Mr. Zhang Yao was appointed as a member of the audit and remuneration committees, and the nomination committee on May 22, 2025[3][4][5] - Ms. Liu Ping and Dr. Wang Yi were appointed as members of the nomination committee on June 19, 2025[4][5] Company Details and Contact Information This section provides the company's basic registration information, headquarters, Hong Kong principal place of business, share registrar, principal bankers, stock exchange code, and website - The company secretary is Mr. Chen Zengwu[6] - The company's headquarters are located at CITIC Plaza, Tianhe North Road, Guangzhou, China[6][7] - The company's shares are listed on the Main Board of The Stock Exchange of Hong Kong Limited, stock code 1529[7][8] Financial Statements Condensed Consolidated Statement of Profit or Loss For the six months ended June 30, 2025, revenue significantly increased by 96.1% to RMB 185.7 million, while loss for the period narrowed to RMB 3.5 million, driven by cost control and strong growth in transportation services Condensed Consolidated Statement of Profit or Loss Key Data | Indicator | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Revenue | 185,656 | 94,701 | | Other income and net gains | 2,983 | 3,895 | | Loss on disposal of subsidiaries | (2,075) | – | | Employee benefits expenses | (26,848) | (36,793) | | Sub-contracting expenses | (137,789) | (48,070) | | Finance costs | (523) | (2,145) | | Other expenses | (17,962) | (21,498) | | Loss before tax | (1,282) | (13,463) | | Loss for the period | (3,454) | (13,224) | | Basic loss per share (RMB cents) | (0.5445) | (7.6560) | Condensed Consolidated Statement of Comprehensive Income For the six months ended June 30, 2025, total comprehensive expense significantly decreased to RMB 2.9 million, a notable improvement from RMB 14.8 million in the prior period, primarily due to a narrower loss and positive exchange differences Condensed Consolidated Statement of Comprehensive Income Key Data | Indicator | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Loss for the period | (3,454) | (13,224) | | Exchange differences arising from translation of overseas operations | 598 | (1,604) | | Total comprehensive expense for the period | (2,856) | (14,828) | | Attributable to owners of the Company | (1,714) | (12,192) | | Attributable to non-controlling interests | (1,142) | (2,636) | Condensed Consolidated Statement of Financial Position As of June 30, 2025, total assets increased to RMB 276.1 million, total equity significantly grew to RMB 190.0 million mainly due to rights issue proceeds, while non-current liabilities substantially decreased Condensed Consolidated Statement of Financial Position Key Data | Indicator | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Total non-current assets | 33,349 | 85,722 | | Total current assets | 242,719 | 171,105 | | Total assets | 276,068 | 256,827 | | Total equity | 190,023 | 133,418 | | Total non-current liabilities | 723 | 12,696 | | Total current liabilities | 85,322 | 110,713 | | Total liabilities | 86,045 | 123,409 | Condensed Consolidated Statement of Changes in Equity For the six months ended June 30, 2025, total equity increased to RMB 190.0 million, primarily driven by RMB 59.8 million from rights issue proceeds, despite a loss for the period Condensed Consolidated Statement of Changes in Equity Key Data | Indicator | June 30, 2025 (RMB thousand) | January 1, 2024 (RMB thousand) | | :--- | :--- | :--- | | Total equity at beginning of period | 133,418 | 143,808 | | Loss for the period | (3,454) | (13,224) | | Exchange differences arising from translation of overseas operations | 598 | (1,604) | | Proceeds from rights issue | 59,759 | N/A | | Reversal of non-controlling interests on disposal of subsidiaries | (298) | N/A | | Total equity at end of period | 190,023 | 145,454 | Condensed Consolidated Statement of Cash Flows For the six months ended June 30, 2025, net cash from operating activities turned into a net inflow of RMB 20.3 million, cash flow from financing activities significantly increased, and cash and cash equivalents at period-end rose to RMB 123.7 million Condensed Consolidated Statement of Cash Flows Key Data | Indicator | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Net cash generated from/(used in) operating activities | 20,345 | (25,694) | | Net cash (used in)/generated from investing activities | (664) | 25,450 | | Net cash generated from financing activities | 53,662 | 6,447 | | Net increase in cash and cash equivalents | 73,343 | 6,203 | | Cash and cash equivalents at end of period | 123,664 | 82,796 | Notes to the Condensed Consolidated Financial Statements 1. GENERAL INFORMATION This section outlines Le Shi International Holdings Group Limited's registration, principal places of business, business scope (transportation, warehousing, logistics, customized services, and goat milk powder sales), and its listing on the Hong Kong Stock Exchange Main Board - The company is incorporated in the Cayman Islands, with its headquarters in Guangzhou, China, and a principal place of business in Hong Kong[17][20] - Its principal activities include transportation, warehousing, in-plant logistics, customized services, and the sale of goat milk powder and other products[18][20] - The condensed consolidated financial statements for the six months ended June 30, 2025, are unaudited but have been reviewed by the audit committee[19][20] 2. BASIS OF PREPARATION AND ACCOUNTING POLICIES This section explains that the condensed consolidated financial statements are prepared in accordance with HKFRSs, adopting all newly revised HKFRSs, which have no material impact on the current period's financial information - The financial statements are prepared in accordance with Hong Kong Financial Reporting Standards (HKFRSs) and adopt all new and revised standards effective January 1, 2025[21][22][24] - The accounting policies applied in this period are consistent with the consolidated financial statements for the year ended December 31, 2024, with no material impact from new standards[23][24] 3. REVENUE This section details the company's revenue from customer contracts, including transportation, warehousing, in-plant logistics, customized services, and goat milk powder sales, explaining performance obligations and revenue recognition timing for each service type Revenue by Service Type | Service Type | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Transportation services | 148,780 | 48,746 | | Warehousing services | 7,440 | 17,509 | | In-plant logistics services | 26,757 | 27,617 | | Customized services | 740 | 829 | | Sales of goat milk powder and other products | 1,939 | – | | Total | 185,656 | 94,701 | - Revenue from transportation, warehousing, and in-plant logistics services is recognized over time, while customized services and goat milk powder sales revenue are recognized at a point in time[30][31] - Transportation services primarily cover various regions in China, warehousing services are provided in China's warehouses, and in-plant logistics services are offered at customer production facilities[29] - Customized services include labeling and packaging, and goat milk powder sales primarily involve dairy product sales[32] 4. SEGMENT INFORMATION This section discloses operating segment revenue and results by service type, based on internal reports reviewed by the chief operating decision maker, and provides non-current asset information by geographical location, indicating the group primarily operates in China Segment Revenue and Results for the Six Months Ended June 30, 2025 | Segment | Revenue (RMB thousand) | Segment Results (RMB thousand) | | :--- | :--- | :--- | | Transportation services | 148,780 | 12,485 | | Warehousing services | 7,440 | (1,019) | | In-plant logistics services | 26,757 | 3,668 | | Customized services | 740 | 477 | | Sales of goat milk powder and other products | 1,939 | 48 | | Total | 185,656 | 15,659 | Segment Revenue and Results for the Six Months Ended June 30, 2024 | Segment | Revenue (RMB thousand) | Segment Results (RMB thousand) | | :--- | :--- | :--- | | Transportation services | 48,746 | 3,305 | | Warehousing services | 17,509 | (55) | | In-plant logistics services | 27,617 | 3,249 | | Customized services | 829 | 182 | | Total | 94,701 | 6,681 | - For the six months ended June 30, 2025, approximately 100% of external customer revenue was derived from China (2024: approximately 96%)[42][44] Non-current Assets by Geographical Location | Region | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | China | 19,373 | 63,175 | | Hong Kong | 188 | 306 | | Total | 19,561 | 63,481 | 5. OTHER INCOME AND NET GAINS For the six months ended June 30, 2025, other income and net gains amounted to RMB 3.0 million, a decrease from RMB 3.9 million in the prior period, primarily due to reduced interest income from loans receivable Other Income and Net Gains | Item | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Interest income from bank deposits | 205 | 313 | | Interest income from loans receivable | 1,055 | 1,676 | | Interest income from rental deposits | – | 17 | | Net exchange gains | 1,751 | 1,730 | | Others | (28) | 159 | | Total | 2,983 | 3,895 | 6. FINANCE COSTS For the six months ended June 30, 2025, finance costs significantly decreased by 75.6% to RMB 0.5 million, primarily attributable to reduced bank loan interest following the disposal of Haihui Group Finance Costs | Item | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Interest on bank borrowings | 260 | 1,470 | | Interest on lease liabilities | 263 | 675 | | Total | 523 | 2,145 | 7. OTHER EXPENSES For the six months ended June 30, 2025, total other expenses were RMB 18.0 million, a decrease from RMB 21.5 million in the prior period, mainly due to optimization of various operating expenses Other Expenses Details | Item | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Auditor's remuneration | 380 | 1,364 | | Cost of inventories | 1,891 | – | | Entertainment expenses | 641 | 1,030 | | Lease payments relating to short-term leases | 2,009 | 2,861 | | Fleet operating expenses | 1,825 | 289 | | Insurance expenses | 315 | 301 | | Legal and professional fees | 2,139 | 1,357 | | Other taxes and surcharges | 269 | 156 | | Outsourcing labor costs | 5,658 | 4,426 | | Repair and maintenance expenses | 224 | 899 | | Telephone and telecommunication expenses | 177 | 185 | | Travel expenses | 435 | 714 | | Utility expenses | 292 | 251 | | Other operating expenses | 1,707 | 7,665 | | Total | 17,962 | 21,498 | 8. INCOME TAX (EXPENSE)/CREDIT For the six months ended June 30, 2025, the company recorded an income tax expense of RMB 2.2 million, compared to an income tax credit of RMB 0.2 million in the prior period, primarily due to current period China corporate income tax Income Tax (Expense)/Credit | Item | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | China corporate income tax — Current period | (2,172) | – | | China corporate income tax — Over-provision | – | 29 | | Other jurisdictions — Current period | – | (575) | | Deferred tax — Current period | – | 785 | | Income tax (expense)/credit | (2,172) | 239 | - Hong Kong profits tax is calculated at 16.5%, but no provision was made as no income arose in Hong Kong[51][54] - China corporate income tax is calculated at 25%, but some subsidiaries enjoy a 15% preferential tax rate due to high-tech enterprise status, and no provision was made due to tax losses[52][54] 9. LOSS PER SHARE For the six months ended June 30, 2025, basic and diluted loss per share was RMB 0.5445 cents, a significant reduction from RMB 7.6560 cents in the prior period, mainly due to a decrease in loss and the impact of share consolidation and rights issue Loss Per Share Calculation Data | Indicator | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 (Restated) | | :--- | :--- | :--- | | Loss for the period attributable to owners of the Company (RMB thousand) | (2,312) | (10,588) | | Weighted average number of ordinary shares for basic loss per share | 424,599,431 | 138,297,073 | | Basic loss per share (RMB cents) | (0.5445) | (7.6560) | | Diluted loss per share (RMB cents) | (0.5445) | (7.6560) | - Basic loss per share for 2025 and 2024 has been adjusted to reflect the bonus element in the rights issue completed in May 2025[58][59] - The weighted average number of shares for basic and diluted loss per share for 2024 has also been retrospectively adjusted to reflect the impact of the share consolidation completed in November 2024[58][59] - For the six months ended June 30, 2025, no share options were exercised, lapsed, cancelled, or forfeited, and there were no potential ordinary shares arising from share options[58][59] 10. TRADE AND OTHER RECEIVABLES As of June 30, 2025, current trade and other receivables increased to RMB 107.0 million, primarily due to higher trade receivables from customer contracts, with detailed disclosures on loans receivable and rental deposits Trade and Other Receivables | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Trade receivables from contracts with customers | 81,365 | 67,832 | | Prepayments | 15,301 | 8,439 | | Other receivables | 2,854 | 3,279 | | Rental deposits | 2,781 | 3,602 | | Loans receivable | 18,218 | 18,635 | | Less: Non-current portion | (13,511) | (20,563) | | Current portion | 107,008 | 81,224 | Ageing Analysis of Trade Receivables (Net of Impairment) | Ageing | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Within 30 days | 75,362 | 63,292 | | 31 to 90 days | 2,883 | 3,141 | | 91 to 180 days | 894 | 206 | | Over 180 days | 2,226 | 1,193 | | Total | 81,365 | 67,832 | - As of June 30, 2025, total loans receivable amounted to approximately RMB 24.8 million, comprising 3 corporate loans and 1 individual loan, with annual interest rates ranging from approximately 6% to 12%, all unsecured[66][67] 11. TRADE AND OTHER PAYABLES As of June 30, 2025, total trade and other payables increased to RMB 75.8 million, primarily due to a significant rise in trade payables, with supplier credit terms mainly ranging from 30 to 90 days Trade and Other Payables | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Trade payables | 71,659 | 38,695 | | Accrued employee benefits | 780 | 5,252 | | Other accrued expenses and other taxes payable | 489 | 1,829 | | Other payables | 2,902 | 2,518 | | Total | 75,830 | 48,294 | Ageing Analysis of Trade Payables | Ageing | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | 1 to 30 days | 40,785 | 28,757 | | 31 to 60 days | 11,558 | 4,012 | | 61 to 90 days | 17,890 | 1,616 | | Over 90 days | 1,426 | 4,310 | | Total | 71,659 | 38,695 | 12. SHARE CAPITAL As of June 30, 2025, the company's issued share capital increased to 667,080,000 shares with a par value of HKD 0.1, primarily due to the rights issue completed in May 2025, raising net proceeds of approximately HKD 67.6 million Share Capital Movement | Item | Number of Shares | Share Capital (HKD) | | :--- | :--- | :--- | | Authorized share capital at January 1, 2024 | 10,000,000,000 | 100,000,000 | | Share consolidation (effective November 8, 2024) | (9,000,000,000) | – | | Authorized share capital at June 30, 2025 | 1,000,000,000 | 100,000,000 | | Issued and fully paid share capital at January 1, 2024 | 1,141,280,000 | 11,412,800 | | Shares issued through placing | 192,880,000 | 1,928,800 | | Share consolidation | (1,200,744,000) | – | | Issued and fully paid share capital at January 1, 2025 | 133,416,000 | 13,341,600 | | Shares to be issued under rights issue (May 16, 2025) | 533,664,000 | 53,366,400 | | Issued and fully paid share capital at June 30, 2025 | 667,080,000 | 66,708,000 | - On November 8, 2024, the company completed a share consolidation, where every ten shares of HKD 0.01 par value were consolidated into one share of HKD 0.10 par value[74] - On May 16, 2025, the company completed a rights issue, issuing 533,664,000 rights shares on a "one-for-four" basis, raising net proceeds of approximately HKD 67.6 million[74][75] 13. DISPOSAL OF SUBSIDIARIES This section discloses the company's disposal of a 60% equity interest in Zhongshan Haihui Keqi Logistics (Group) Co., Ltd. for RMB 1 and the transfer of a shareholder loan for RMB 7 million in January 2025, resulting in a recognized disposal loss of approximately RMB 2.1 million for the period - On December 20, 2024, the company entered into an agreement to dispose of a 60% equity interest in Zhongshan Haihui Keqi Logistics (Group) Co., Ltd. for a consideration of RMB 1[76][80] - On the same day, the company entered into a loan transfer agreement with the buyer to transfer a shareholder loan for RMB 7 million[77][80] - The disposal was approved at an extraordinary general meeting held on January 27, 2025, and the consideration was received before June 30, 2025[79][80] - A loss on disposal of approximately RMB 2.1 million was recognized for the period ended June 30, 2025[11] 14. DIVIDEND The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025 (2024: nil) - The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025[82][84] 15. EVENTS AFTER THE REPORTING PERIOD Subsequent to the reporting period, on July 8, 2025, the company acquired a 100% equity interest in Bozhou Lelaohao Pharmaceutical Co., Ltd. for RMB 0.9 million to expand its pharmaceutical wholesale and distribution business and diversify operations - On July 8, 2025, the Group acquired a 100% equity interest in Bozhou Lelaohao Pharmaceutical Co., Ltd. for a total consideration of RMB 0.9 million[83][85] - The target company primarily engages in the wholesale and distribution of pharmaceuticals, sales of Class I and Class II medical devices, and wholesale of protective medical supplies for healthcare personnel[83][85] - Upon completion of the acquisition, the target company became an indirect wholly-owned subsidiary of the Company, and its financial results are consolidated into the Group's financial statements[83][85] Management Discussion and Analysis BUSINESS REVIEW This section outlines the Group's logistics services in China, including transportation, warehousing, in-plant logistics, customized services, and goat milk powder sales, noting a 96.1% revenue increase in H1 2025 despite challenges like slowing manufacturing investment and rising outsourcing costs - The Group provides diversified logistics services including transportation, warehousing, in-plant logistics, customized services, and goat milk powder sales[87][90] - In H1 2025, China's total social logistics volume grew by 5.6%, and the Group's revenue significantly increased year-on-year, confirming successful strategic transformation[89][91] - The Group faces challenges such as weakened manufacturing investment, insufficient market momentum leading to decreased warehouse utilization and transport volumes, and rising outsourcing costs and diesel prices[92][94] - Through strict cost control, optimized organizational efficiency, digital approval implementation, and centralized procurement, the Group successfully narrowed its net loss in H1 2025[93][94] OUTLOOK Looking ahead to H2 2025, China's logistics and warehousing sector will continue its transformation, with opportunities in intelligent upgrades, urban-rural network optimization, and emerging logistics (cold chain, pharmaceutical), as the Group pursues innovation-driven, efficiency-centric strategies - China's logistics and warehousing sector is expected to continue structural growth driven by government policies and market demand, with opportunities in intelligent upgrades and urban-rural network optimization[95][97] - Emerging sectors like cold chain and pharmaceutical logistics will accelerate development, digital technologies (IoT, AI) will be deeply integrated, and green, low-carbon measures will become core competitive advantages[95][97] - The industry faces challenges including regional supply-demand imbalance in warehousing facilities, energy price volatility, labor shortages, and accelerating market consolidation[96][98] - The Group will implement an innovation-driven, efficiency-centric strategy, optimizing its warehousing network, introducing smart equipment, and expanding its Inner Mongolia goat milk product business and Fuzhou traditional Chinese medicine logistics facilities[99][100] FINANCIAL REVIEW This section provides a detailed review of the financial performance for the six months ended June 30, 2025, covering revenue, other income and net gains, loss on disposal of subsidiaries, various expenses, loss for the period, total comprehensive expense, liquidity, funding and treasury policies, gearing ratio, and capital structure Revenue Analysis For the six months ended June 30, 2025, Group revenue surged by 96.1% to RMB 185.7 million, primarily driven by a 205.5% increase in transportation services revenue and expansion into new regions like Hangzhou and Inner Mongolia, while warehousing and in-plant logistics revenues declined, and goat milk powder business contributed RMB 1.9 million - For the six months ended June 30, 2025, revenue increased by 96.1% year-on-year to RMB 185.7 million[101][104] - Transportation services revenue grew by 205.5% to RMB 148.8 million, benefiting from domestic demand recovery, government policy support, and business expansion into Hangzhou and Inner Mongolia[101][104] - Warehousing services revenue decreased by 57.7% to RMB 7.4 million, mainly due to reduced demand and the disposal of Haihui Group[102][104] - Sales of goat milk powder and other products commenced in H1 2025, contributing RMB 1.9 million in revenue, representing a strategic move towards business diversification[107][110] Other income and net gains analysis For the six months ended June 30, 2025, other income and net gains amounted to RMB 3.0 million, a decrease from RMB 3.9 million in the prior period, primarily due to a decline of approximately RMB 0.6 million in interest income from loans receivable - Other income and net gains amounted to RMB 3.0 million (2024: RMB 3.9 million)[108][111] - The primary reason for the decrease was a reduction of approximately RMB 0.6 million in interest income from loans receivable[108][111] Loss on disposal of subsidiaries Due to the disposal of a 60% equity interest in Zhongshan Haihui Keqi Logistics (Group) Co., Ltd. in January 2025, the Group recognized a disposal loss of approximately RMB 2.1 million, and its financial results are no longer consolidated - The disposal of a 60% equity interest in Zhongshan Haihui Keqi Logistics (Group) Co., Ltd. in January 2025 resulted in a recognized disposal loss of approximately RMB 2.1 million[109][112] Employee benefits expenses For the six months ended June 30, 2025, employee benefits expenses decreased by 27.0% to RMB 26.8 million, primarily due to stringent cost control measures and reduced labor costs following the disposal of Haihui Group - Employee benefits expenses decreased from RMB 36.8 million to RMB 26.8 million[113][115] - The decrease was due to stringent cost control and reduced labor costs after the disposal of Haihui Group[113][115] Sub-contracting expenses For the six months ended June 30, 2025, sub-contracting expenses significantly increased to RMB 137.8 million, primarily due to higher revenue during the period, particularly from growth in domestic transportation services and international freight forwarding orders - Sub-contracting expenses significantly increased from RMB 48.1 million to RMB 137.8 million[114][116] - The increase was primarily attributable to higher revenue during the period, especially from domestic transportation services and international freight forwarding orders[114][116] Depreciation of right-of-use assets For the six months ended June 30, 2025, depreciation of right-of-use assets was approximately RMB 3.0 million, slightly lower than RMB 3.2 million in the prior period, mainly related to leases of warehouses, office properties, and plant and machinery - Depreciation of right-of-use assets was approximately RMB 3.0 million (2024: RMB 3.2 million)[117][120] - Depreciated assets include warehouses, office properties, temporary staff dormitories, and plant and machinery such as forklifts[117][120] Finance costs analysis For the six months ended June 30, 2025, finance costs significantly decreased from RMB 2.1 million to RMB 0.5 million, primarily due to reduced bank loan interest following the disposal of Haihui Group - Finance costs decreased from RMB 2.1 million to RMB 0.5 million[118][121] - This was primarily attributable to reduced bank loan interest following the disposal of Haihui Group[118][121] Other expenses analysis For the six months ended June 30, 2025, total other expenses amounted to RMB 18.0 million, a decrease from RMB 21.5 million in the prior period, primarily comprising outsourcing labor costs, short-term lease payments, and legal and professional fees - Total other expenses amounted to RMB 18.0 million (2024: RMB 21.5 million)[119][122] - Key components include outsourcing labor costs, short-term lease payments, auditor's remuneration, legal and professional fees, fleet operating expenses, and cost of inventories[119][122] Loss and total comprehensive expense for the period For the six months ended June 30, 2025, the Group recorded a loss for the period of approximately RMB 3.5 million and total comprehensive expense of approximately RMB 2.9 million, significantly narrowed from RMB 13.2 million and RMB 14.8 million respectively in the prior period - Loss for the period was approximately RMB 3.5 million (2024: RMB 13.2 million)[123][126] - Total comprehensive expense was approximately RMB 2.9 million (2024: RMB 14.8 million)[123][126] LIQUIDITY AND FINANCIAL RESOURCES As of June 30, 2025, the Group's net current assets were approximately RMB 157.4 million, with cash and cash equivalents of approximately RMB 123.7 million, and the directors confirm sufficient financial resources to meet future obligations - As of June 30, 2025, net current assets were approximately RMB 157.4 million (December 31, 2024: RMB 60.4 million)[124][127] - Cash and cash equivalents were approximately RMB 123.7 million (December 31, 2024: RMB 49.7 million), primarily denominated in HKD and RMB[124][127] - The directors confirm that the Group will have sufficient financial resources to meet its obligations as they fall due in the foreseeable future[124][127] FUNDING AND TREASURY POLICIES The Group's funding and treasury policies aim to ensure adequate financial resources for business and investment activities, prudently manage interest rate and foreign exchange risks, and maintain a robust balance sheet with ample liquidity - The policy objective is to ensure adequate financial resources for business and investment support, and prudent management of financial risks[125][128] - Interest rate and foreign exchange risks are managed through a diversified funding base and financial instruments[125][128] - The Group is committed to maintaining a robust balance sheet and ample liquidity to enhance financial flexibility and resilience[125][128] GEARING RATIO As of June 30, 2025, the Group was in a net cash position, with time deposits and cash equivalents exceeding bank and other borrowings and lease liabilities, thus the gearing ratio was not applicable (December 31, 2024: 4.9%) - As of June 30, 2025, the Group was in a net cash position, and the gearing ratio was not applicable[130][134] - The gearing ratio as of December 31, 2024, was 4.9%[130][134] CAPITAL STRUCTURE The Group's capital structure comprises issued share capital and reserves, which the Board regularly reviews and balances through dividends, new share issues, share repurchases, and debt management; a rights issue completed in May 2025 issued 533,664,000 new shares, raising net proceeds of approximately HKD 67.6 million - The capital structure consists of issued share capital and reserves, which the Board regularly reviews[131][135] - On February 14, 2025, the company announced a rights issue to issue up to 533,664,000 rights shares on a "one-for-four" basis at a subscription price of HKD 0.13 per share[133][135] - The rights issue was completed on May 16, 2025, raising net proceeds of approximately HKD 67.6 million and issuing 533,664,000 rights shares[136][142] - As of June 30, 2025, the company had 667,080,000 shares of HKD 0.1 par value in issue[137][142] FOREIGN CURRENCY EXPOSURE The Group's operations are primarily RMB-denominated in China, with some subsidiaries having foreign currency sales and purchases, exposing them to foreign exchange risk; currently, there is no hedging policy, but the Board will continue to monitor and consider hedging significant exposures - The Group's operations are primarily RMB-denominated in China, with some subsidiaries engaging in foreign currency transactions, leading to foreign exchange risk[138][143] - Currently, there is no foreign currency hedging policy, but the Board will continue to monitor and consider hedging significant foreign exchange exposures[138][143] CHARGE ON THE GROUP'S ASSETS As of June 30, 2025, the Group had no charges on its assets, except as disclosed in the report (December 31, 2024: nil) - As of June 30, 2025, the Group had no charges on its assets[139][144] CONTINGENT LIABILITIES As of June 30, 2025, the Group had no significant contingent liabilities, except as disclosed in the report (December 31, 2024: nil) - As of June 30, 2025, the Group had no significant contingent liabilities[140][145] CAPITAL COMMITMENTS As of June 30, 2025, the Group had no significant capital commitments (December 31, 2024: nil) - As of June 30, 2025, the Group had no significant capital commitments[141][146] SIGNIFICANT INVESTMENTS, MATERIAL ACQUISITIONS AND DISPOSALS OF SUBSIDIARIES AND AFFILIATED COMPANIES For the six months ended June 30, 2025, the Group had no significant investments, material acquisitions, or disposals of subsidiaries and affiliated companies, except as disclosed in the report - For the six months ended June 30, 2025, the Group had no significant investments, material acquisitions, or disposals of subsidiaries and affiliated companies, except as disclosed in the report[147][150] EMPLOYEES AND REMUNERATION POLICIES As of June 30, 2025, the Group employed 574 full-time employees, with remuneration determined by qualifications, responsibilities, contributions, market conditions, and company policies, offering retirement scheme contributions, share options, and training - As of June 30, 2025, the Group employed 574 full-time employees (June 30, 2024: 640 employees)[148][151] - Employee remuneration is determined based on qualifications, responsibilities, contributions, work experience, market conditions, and company policies[148][151] - Employee benefits include retirement scheme contributions and share options, with both on-the-job training and external training sponsorships provided[148][151] FUTURE PLANS FOR MATERIAL INVESTMENTS OR CAPITAL ASSETS As of June 30, 2025, the Group had no specific future plans for material investments or capital assets, except as disclosed in the report - As of June 30, 2025, the Group had no specific plans for material investments or capital assets, except as disclosed in the report[149][152] USE OF PROCEEDS This section details the planned and actual use of proceeds from the 2023 Placing, 2024 Placing, and 2025 Rights Issue, covering smart logistics development, infrastructure investment, general working capital, Inner Mongolia goat milk product business, and Jiangxi traditional Chinese medicine logistics park warehouse construction Use of proceeds from placing of new shares (2023 Placing) Net proceeds from the 2023 Placing were approximately HKD 34.2 million, of which HKD 30.0 million remained unutilized as of June 30, 2025, originally planned for smart logistics services, but the Board decided on July 25, 2025, to reallocate it to traditional Chinese medicine business development and general working capital - Net proceeds from the 2023 Placing were approximately HKD 34.2 million[153][154] 2023 Placing Net Proceeds Utilization Analysis | Intended Use | Unutilized as of December 31, 2024 (HKD million) | Actually Utilized in Current Period (HKD million) | Unutilized as of June 30, 2025 (HKD million) | | :--- | :--- | :--- | :--- | | Development of smart logistics services business | 30.0 | – | 30.0 | - On July 25, 2025, the Board resolved to change the use of unutilized proceeds from "development of smart logistics services business" to "development of traditional Chinese medicine business" and "general working capital"[156] Use of proceeds from placing of new shares (2024 Placing) Net proceeds from the 2024 Placing were approximately HKD 18.5 million, of which HKD 7.7 million remained unutilized as of June 30, 2025, planned for investment in logistics business infrastructure, expected to be utilized by the end of 2026 - Net proceeds from the 2024 Placing were approximately HKD 18.5 million[157][158] 2024 Placing Net Proceeds Utilization Analysis | Intended Use | Unutilized as of December 31, 2024 (HKD million) | Actually Utilized in Current Period (HKD million) | Unutilized as of June 30, 2025 (HKD million) | | :--- | :--- | :--- | :--- | | Investment in logistics business infrastructure | 7.7 | – | 7.7 | - The remaining proceeds are expected to be utilized by or before the year ending December 31, 2026[160] Use of proceeds from Rights Issue The 2025 Rights Issue raised net proceeds of approximately HKD 67.6 million, allocated for general working capital, Inner Mongolia goat milk product business development, and warehouse construction in Jiangxi's traditional Chinese medicine logistics industrial park; most funds remained unutilized as of June 30, 2025, and will be used as planned over the next one to two years - The Rights Issue raised net proceeds of approximately HKD 67.6 million[167][169] Rights Issue Net Proceeds Utilization Analysis | Intended Use | Actually Utilized in Current Period (HKD million) | Unutilized as of June 30, 2025 (HKD million) | | :--- | :--- | :--- | | General working capital | 0.9 | 26.7 | | Development of goat milk product business in Inner Mongolia Autonomous Region | 4.7 | 15.3 | | Construction of warehouses and/or other logistics-related facilities in the Traditional Chinese Medicine Logistics Industrial Park in Jiangxi Province, China | – | 20.0 | - The remaining proceeds for general working capital and Jiangxi traditional Chinese medicine logistics facilities are expected to be utilized by the end of 2026, while those for the goat milk product business are expected to be utilized by the end of 2025[172] Corporate Governance and other Information SHARE OPTION SCHEME The company adopted a new share option scheme on November 23, 2023, replacing the previous one; as of June 30, 2025, no share options have been granted under the new scheme, with 11,412,800 options available for grant - The company adopted a new share option scheme on November 23, 2023, which became effective on November 29, 2023[173][177] - The new scheme allows the Board to invite employees, directors, consultants, etc., to subscribe for shares, up to 10% of the issued shares on the listing date[174][177] - As of June 30, 2025, no share options have been granted, exercised, cancelled, or lapsed under the new share option scheme, and no outstanding share options exist[179][181] - As of June 30, 2025, the number of share options available for grant under the scheme was 11,412,800[176][178] DIRECTORS' AND CHIEF EXECUTIVE'S INTERESTS AND SHORT POSITIONS IN SHARES, UNDERLYING SHARES AND DEBENTURES As of June 30, 2025, no directors, chief executive, or their associates held any interests or short positions in the shares, underlying shares, or debentures of the company or any associated corporation that are required to be disclosed under the Securities and Futures Ordinance - As of June 30, 2025, no directors, chief executive, or their associates held any disclosable interests or short positions in the company's shares, underlying shares, or debentures[180][182] SUBSTANTIAL SHAREHOLDERS' INTERESTS AND SHORT POSITIONS IN SHARES AND UNDERLYING SHARES As of June 30, 2025, to the best knowledge of the directors, no person other than a director or chief executive held any interests or short positions in the company's shares or underlying shares that are required to be disclosed under the Securities and Futures Ordinance - As of June 30, 2025, to the best knowledge of the directors, no person other than a director or chief executive held any disclosable interests or short positions in the company's shares or underlying shares[183][186] DIRECTORS' RIGHTS TO ACQUIRE SHARES OR DEBENTURES For the six months ended June 30, 2025, except for the share option scheme, neither the company nor any of its subsidiaries was a party to any arrangement that would enable directors to acquire benefits by acquiring shares or debentures of the company or any other body corporate - For the six months ended June 30, 2025, except for the share option scheme, the company had no arrangements enabling directors to acquire benefits by acquiring shares or debentures[184][187] PURCHASE, SALE OR REDEMPTION OF THE COMPANY'S LISTED SECURITIES 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, and the company held no treasury shares - For the six months ended June 30, 2025, neither the company nor its subsidiaries purchased, sold, or redeemed any listed securities[185][188] - As of June 30, 2025, the company held no treasury shares[185][188] CORPORATE GOVERNANCE The Board is committed to maintaining high standards of corporate governance, has adopted the principles and provisions of the Corporate Governance Code set out in Appendix C1 of the Listing Rules, and complied with the relevant code during the six months ended June 30, 2025 - The Board is committed to maintaining high standards of corporate governance and has adopted the Corporate Governance Code in Appendix C1 of the Listing Rules[189][193] - For the six months ended June 30, 2025, the company complied with the provisions of the Corporate Governance Code[190][193] COMPETING INTERESTS For the six months ended June 30, 2025, to the best knowledge of the directors, no director, substantial shareholder, or their associates had any business or interest that competes directly or indirectly with the Group's business, nor any other conflicts of interest - For the six months ended June 30, 2025, no directors, substantial shareholders, or their associates had competing interests or conflicts of interest with the Group's business[191][194] DIRECTORS' SECURITIES TRANSACTIONS 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; all directors confirmed full compliance with this code during the six months ended June 30, 2025, with no non-compliance incidents - The company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers as its code of conduct for directors' securities transactions[192][195] - All directors confirmed full compliance with the code during the reporting period, with no non-compliance incidents[192][195] AUDIT COMMITTEE The Audit Committee, comprising three independent non-executive directors, is responsible for recommending external auditors, reviewing financial statements, and overseeing internal controls and risk management; the committee has reviewed the unaudited consolidated financial statements for the six months ended June 30, 2025, deeming them compliant with applicable accounting standards and adequately disclosed - The Audit Committee comprises three independent non-executive directors: Mr. Liu Weibiao (Chairman), Dr. Wang Yi, and Mr. Zhang Yao[196][199] - Its primary responsibilities include recommending external auditors, reviewing financial statements, and overseeing internal controls and risk management[196][199] - The committee has reviewed the unaudited consolidated financial statements for the six months ended June 30, 2025, and considers them compliant with accounting standards and adequately disclosed[196][199] RESIGNATION OF DIRECTORS During the reporting period, Mr. Du Yingyou resigned as an executive director on March 17, 2025, and Mr. Chen Guanyong resigned as an independent non-executive director and exited all committees on May 22, 2025 - Mr. Du Yingyou resigned as an executive director on March 17, 2025[197][200] - Mr. Chen Guanyong resigned as an independent non-executive director on May 22, 2025, and ceased to be a member of the audit, remuneration, and nomination committees[197][200] UPDATE ON DIRECTORS' INFORMATION UNDER RULE 13.51B(1) OF THE LISTING RULES During the reporting period, no other information was required to be disclosed under Rule 13.51B(1) of the Listing Rules - During the reporting period, no director information updates were required to be disclosed under Rule 13.51B(1) of the Listing Rules[198][201] EVENTS AFTER THE REPORTING PERIOD No significant events occurred after the reporting period, other than those already disclosed in this report - No significant events occurred after the reporting period, other than those already disclosed in this report[202][204]