小菜园(00999) - 2025 - 中期财报

Company Information The company's governance structure, registration, operating locations, and professional advisory relationships are detailed in this section Board of Directors and Committees The company's Board of Directors comprises executive, non-executive, and independent non-executive directors, supported by audit, remuneration, and nomination committees to ensure robust corporate governance - The Board members include Wang Shugao (Chairman and General Manager), Li Daoqing, Tian Chunyong, Zhou Bin, Wang Weifang, Tao Xu'an as executive directors, Zhu Xuejing (newly appointed) and Luo Yongxiang (resigned) as non-executive directors, and Qian Mingxing, Zhu Nanjun, Zeng Xiaosong, Fang Xuan as independent non-executive directors[7] - The company has an Audit Committee (Chairman: Zhu Nanjun), a Remuneration Committee (Chairman: Fang Xuan), and a Nomination Committee (Chairman: Wang Shugao)[7] Registered and Operating Locations The company is registered in the Cayman Islands, with its principal operating location in Tongling City, Anhui Province, China, and a principal place of business in Hong Kong - The company's registered office is in the Cayman Islands, its principal office and place of business in China are in Tongling City, Anhui Province, and its principal place of business in Hong Kong is in Lee Garden Two, Causeway Bay[8][9] Professional Advisors and Auditor The company has engaged Linklaters, Tian Yuan Law Firm, and Harney Westwood & Riegels as legal advisors, Ascent Partners Corporate Finance Limited as compliance advisor, and KPMG as auditor - The company's legal advisors include Linklaters (Hong Kong law), Tian Yuan Law Firm (PRC law), and Harney Westwood & Riegels (Cayman Islands law)[9] - The compliance advisor is Ascent Partners Corporate Finance Limited, and the auditor is KPMG[9] Financial Highlights This section provides a concise overview of the company's financial performance and position for the reporting period Performance Overview For the six months ended June 30, 2025, the company's revenue increased by 6.5% year-on-year to RMB 2.714 billion, profit before tax surged by 42.4% to RMB 542 million, profit for the period grew by 35.7% to RMB 382 million, and both basic and diluted earnings per share increased by 22.2% to RMB 0.33 Performance Highlights for the Six Months Ended June 30 | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 2,713,666 | 2,547,463 | 6.5% | | Profit before tax | 542,313 | 380,860 | 42.4% | | Income tax | (159,916) | (98,981) | 61.6% | | Profit for the period | 382,397 | 281,879 | 35.7% | | Basic EPS (RMB) | 0.33 | 0.27 | 22.2% | | Diluted EPS (RMB) | 0.33 | 0.27 | 22.2% | Assets and Liabilities As of June 30, 2025, the company's total assets increased by 3.0% to RMB 3.695 billion, total liabilities grew by 8.2% to RMB 1.323 billion, and net assets slightly increased by 0.3% to RMB 2.373 billion Summary of Assets and Liabilities | Indicator | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | Change (%) | | :--- | :--- | :--- | | Total assets | 3,695,449 | 3,587,900 | 3.0% | | Total liabilities | 1,322,895 | 1,222,485 | 8.2% | | Net assets | 2,372,554 | 2,365,415 | 0.3% | Management Discussion and Analysis This section provides a comprehensive review of the company's operational performance, financial condition, and future strategies within the context of the broader industry landscape Industry Review Changes in China's economic and social development, including stable growth in urban per capita disposable income, rising urbanization rates, and demographic shifts, collectively drive the mass-market Chinese catering sector, benefiting the company's strategy to expand beyond its current RMB 50-100 average spending market - Stable growth in China's urban per capita disposable income, rising urbanization rates, and demographic shifts are favorable for the mass-market catering sector's development[13] - The company's "Xiaocaiyuan" brand is deeply rooted in the mass-market Chinese catering segment with an average spending of RMB 50 to RMB 100, and plans to steadily expand into the market with an average spending below RMB 50[13] Business Review As a renowned mass-market Chinese catering chain, the company continuously optimizes operational efficiency and cost management, establishing "Xiaocaiyuan" as a recognized "family kitchen," with revenue primarily from dine-in and significantly growing takeaway businesses, despite expanding store count, same-store sales and average customer spending declined - Since its establishment in 2013, the company has been committed to offering home-style dishes at affordable prices with attentive service, building "Xiaocaiyuan" into a "family kitchen" for Chinese consumers[14] - The company continuously optimizes operational efficiency, rigorously manages costs and expenses, deepens refined management, and steadily enhances operating performance[14] Revenue Composition and Growth For the six months ended June 30, 2025, total revenue increased by 6.5% year-on-year to RMB 2.714 billion, with dine-in revenue growing 2.2% to RMB 1.647 billion due to increased store count, and takeaway revenue rising 13.7% to RMB 1.057 billion driven by more orders and enhanced online platform appeal Revenue Breakdown by Business Line | Business Line | 2025 (RMB thousand) | 2025 (%) | 2024 (RMB thousand) | 2024 (%) | | :--- | :--- | :--- | :--- | :--- | | Dine-in business | 1,647,139 | 60.7 | 1,611,603 | 63.3 | | Takeaway business | 1,057,411 | 39.0 | 929,709 | 36.5 | | Others | 9,116 | 0.3 | 6,151 | 0.2 | | Total | 2,713,666 | 100.0 | 2,547,463 | 100.0 | - Dine-in business revenue increased by 2.2%, primarily due to the number of operating stores increasing from 617 as of June 30, 2024, to 672 as of June 30, 2025[17] - Takeaway business revenue increased by 13.7%, mainly due to the number of takeaway orders rising from 12.8 million to 16.8 million, attributed to more stores offering takeaway services and enhanced appeal of online takeaway platforms[18] Key Performance Indicators As of June 30, 2025, the company's total store count reached 672, while the overall average spending per dine-in customer decreased from RMB 60.4 to RMB 57.1, and the overall table turnover rate remained at 3.1 times/day, with same-store sales, average daily same-store sales, and same-store table turnover rate all slightly declining "Xiaocaiyuan" Store Count and Revenue Distribution (by City Tier) | City Tier | 2025 Store Count | 2025 Total Revenue (RMB thousand) | 2025 Revenue Share (%) | 2024 Store Count | 2024 Total Revenue (RMB thousand) | 2024 Revenue Share (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Tier 1 Cities | 109 | 480,298.6 | 17.8 | 93 | 448,977.0 | 17.8 | | New Tier 1 Cities | 192 | 793,823.7 | 29.5 | 176 | 733,145.9 | 29.1 | | Tier 2 Cities | 80 | 330,310.9 | 12.3 | 76 | 307,893.6 | 12.2 | | Tier 3 and Below Cities | 291 | 1,086,906.3 | 40.4 | 272 | 1,030,830.8 | 40.9 | | Total | 672 | 2,691,339.5 | 100.0 | 617 | 2,520,847.3 | 100.0 | "Xiaocaiyuan" Key Store Performance Indicators | Indicator | 2025 | 2024 | | :--- | :--- | :--- | | Average spending per dine-in customer (RMB) | 57.1 | 60.4 | | Table turnover rate (times/day) | 3.1 | 3.1 | "Xiaocaiyuan" Same-Store Performance Indicators | Indicator | 2025 | 2024 | | :--- | :--- | :--- | | Same-store count | 522 | - | | Same-store sales (RMB thousand) | 2,157,229.8 | 2,323,798.5 | | Average daily same-store sales (RMB) | 22,854.4 | 24,641.0 | | Same-store table turnover rate (times/day) | 3.0 | 3.1 | - For the six months ended June 30, 2025, the overall table turnover rate remained at 3.1 times/day, with a slight increase in Tier 2 cities' turnover rate primarily due to improved per-square-meter efficiency from optimized store formats[21] Cost and Expense Analysis During the reporting period, the company effectively controlled raw material and staff costs, both decreasing as a percentage of revenue, indicating improved management efficiency and supply chain management, while advertising and promotion expenses and takeaway service expenses significantly increased due to business expansion and market investment, and income tax rose sharply due to increased PRC dividend withholding tax - Other income decreased by 33.5% to RMB 15.2 million, primarily due to lower bank deposit interest income[27] - Raw materials and consumables used decreased by 2.2% to RMB 801.7 million, with its percentage of revenue falling from 32.2% to 29.5%, mainly benefiting from centralized procurement and improved supply chain management efficiency[28] - Staff costs decreased by 8.2% to RMB 666.4 million, with its percentage of revenue falling from 28.5% to 24.6%, primarily due to improved store management efficiency and labor productivity[29] - Advertising and promotion expenses significantly increased by 71.1% to RMB 53.3 million, mainly due to increased investment in offline advertising and marketing activities[36] - Takeaway service expenses increased by 11.4% to RMB 181.9 million, consistent with the growth in takeaway business revenue, with its percentage of total revenue rising from 6.4% to 6.7%[37] - Income tax increased by 61.6% to RMB 159.9 million, with the effective tax rate rising from 26.0% to 29.5%, primarily due to increased PRC dividend withholding tax[41] Non-IFRS Measures The company uses adjusted net profit and adjusted EBITDA as non-IFRS measures to provide a clearer perspective on operating performance, with adjusted net profit at RMB 382 million and adjusted EBITDA at RMB 647 million for the six months ended June 30, 2025, both showing significant year-on-year growth - Adjusted net profit is defined as net profit plus fair value changes of convertible bonds and derivative financial instruments, changes in carrying amount of redemption liabilities, and listing expenses[45] - Adjusted EBITDA adds back income tax, net finance costs, and depreciation and amortization of other assets to adjusted net profit[45] Reconciliation of Net Profit to Adjusted Net Profit and Adjusted EBITDA | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Net profit | 382,397 | 281,879 | | Adjusted net profit (Non-IFRS measure) | 382,397 | 264,365 | | Adjusted EBITDA (Non-IFRS measure) | 646,966 | 454,139 | Balance Sheet Item Analysis The company optimized inventory and trade and other receivables through improved supply chain management efficiency, leading to a decrease in these balances, while trade and other payables increased, primarily due to accelerated year-end settlement processes - Right-of-use assets decreased by 8.7% to RMB 720.4 million, primarily attributable to increased depreciation of right-of-use assets[46] - Inventories decreased to RMB 74.1 million, and inventory turnover days decreased from 23.6 days to 20.7 days, mainly due to improved supply chain management efficiency[47][48] - Trade and other receivables decreased by 22.5% to RMB 233.9 million, primarily due to optimized prepayment levels[49] - Trade and other payables increased to RMB 270.8 million, mainly due to accelerated year-end settlement processes with suppliers[50] Liquidity and Capital Resources The company maintains ample liquidity with a significant increase in net cash from operating activities, and during the reporting period, new bank loans of RMB 100 million led to a rise in the capital-to-debt ratio from 0% to 4.2%, with no assets pledged or contingent liabilities - As of June 30, 2025, cash and cash equivalents amounted to RMB 638.8 million, and net cash generated from operating activities was RMB 764.8 million, a significant increase from RMB 455.0 million in the prior period[51] - As of June 30, 2025, bank loans totaled RMB 100 million, primarily for letter of credit borrowings to purchase ingredients, at an interest rate of 1.75%[53] - The capital-to-debt ratio increased from 0% as of December 31, 2024, to 4.2% as of June 30, 2025, primarily due to increased bank loans[56] - The Group has not pledged any assets and has no contingent liabilities[54][55] Employees and Remuneration Policy As of June 30, 2025, the company had a total of 12,498 employees, with total staff costs amounting to RMB 666.4 million, implementing diverse remuneration and incentive mechanisms, and providing regular training to enhance operational skills and management capabilities - As of June 30, 2025, the Group had a total of 12,498 employees, with total staff costs amounting to RMB 666.4 million[58] - The company's remuneration policy includes basic salaries, overtime pay, performance-based incentive bonuses, and discretionary bonuses for store managers, head chefs, and key employees in new stores[58][59] - The company conducts monthly training courses aimed at enhancing employees' operational skills, developing management capabilities, and reinforcing company values[59] Material Investments and Future Plans There were no material acquisitions or disposals during the reporting period, and the company invested working capital in wealth management products to enhance returns, with future plans including continuous store network expansion, supply chain enhancement, digital system upgrades, and active exploration of Chinese community catering business - There were no material acquisitions or disposals of subsidiaries, associates, or joint ventures during the reporting period[60] - The company invested working capital in non-principal-protected floating-rate wealth management products issued by Agricultural Bank of China Limited, with a fair value of RMB 200.8 million as of June 30, 2025, accounting for 5.42% of total assets[61] - Future outlook includes consolidating its leading position in the mass-market Chinese catering sector, continuously enhancing the dining experience at operating stores, optimizing the supply chain management system, strategically expanding the store network, and exploring Chinese community catering business[64] Corporate Governance and Other Information This section details the company's corporate governance practices, shareholding structure, use of global offering proceeds, and other relevant disclosures Interim Dividend The Board has resolved to declare an interim dividend of RMB 0.2119 per share for the six months ended June 30, 2025, totaling approximately RMB 250 million, which was paid on September 16, 2025 - The Board resolved to declare an interim dividend of RMB 0.2119 per share, totaling approximately RMB 250 million, which was paid on September 16, 2025[65] Listed Securities Transactions During the reporting period, neither the company nor its subsidiaries purchased, sold, or redeemed any listed securities, and no treasury shares were held - During the reporting period, neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's securities[66] - As of June 30, 2025, the company did not hold any treasury shares[67] Compliance with Corporate Governance Code The company has complied with all applicable provisions of the Corporate Governance Code, except for the deviation where Mr. Wang Shugao holds both Chairman and General Manager roles, which the Board believes provides strong leadership with sufficient checks and balances - The company has complied with all applicable code provisions of the Corporate Governance Code, except for a deviation from code provision C.2.1 (roles of Chairman and Chief Executive should be separate)[68][69] - Mr. Wang Shugao serves as both Chairman and General Manager, an arrangement the Board believes provides strong and consistent leadership for the Group, with adequate checks and balances in place[69] Changes in Directors and Senior Management Mr. Luo Yongxiang resigned as a non-executive director on March 7, 2025, and Ms. Zhu Xuejing was appointed as a non-executive director on the same day, bringing extensive experience in capital markets and private equity investment - Mr. Luo Yongxiang resigned as a non-executive director due to other work commitments, effective March 7, 2025[72] - Ms. Zhu Xuejing was appointed as a non-executive director effective March 7, 2025, possessing 12 years of experience in business operations, risk control, and compliance for capital market and private equity investment institutions[73] Directors' and Major Shareholders' Interests As of June 30, 2025, Mr. Wang Shugao, as the largest shareholder, held 85.00% of the company's shares through controlled corporations, while several directors and other individual shareholders collectively held interests in XCY Yongqing Limited through a concert party agreement, indirectly owning company shares, and Harvest Delicacy held 5.97% of shares Interests of Directors and Chief Executive in the Company's Shares | Name of Director or Chief Executive | Nature of Interest | Number of Shares Interested | Approximate Percentage of Interest in the Company | | :--- | :--- | :--- | :--- | | Mr. Wang Shugao | Interest in controlled corporation | 1,000,000,000 | 85.00% | | Mr. Li Daoqing | Jointly held interest with other parties | 429,714,000 | 36.52% | | Mr. Tian Chunyong | Jointly held interest with other parties | 429,714,000 | 36.52% | | Mr. Zhou Bin | Jointly held interest with other parties | 429,714,000 | 36.52% | | Ms. Wang Weifang | Jointly held interest with other parties | 429,714,000 | 36.52% | | Mr. Tao Xu'an | Jointly held interest with other parties | 429,714,000 | 36.52% | Interests of Major Shareholders in the Company's Shares | Shareholder Name | Capacity/Nature of Interest | Number of Shares Held | Approximate Percentage of Interest in the Company | | :--- | :--- | :--- | :--- | | XCY Yongqing Limited | Beneficial owner | 429,714,000 | 36.52% | | XCY Xuyuan Limited | Beneficial owner | 275,429,000 | 23.41% | | XCY Zhiyuan Limited | Beneficial owner | 69,714,000 | 5.93% | | XCY Huiming Limited | Beneficial owner | 56,000,000 | 4.76% | | XCY Weiyuan Limited | Beneficial owner | 26,857,000 | 2.28% | | XCY Liyuan Limited | Beneficial owner | 20,571,000 | 1.75% | | XCY Future Limited | Beneficial owner | 121,715,000 | 10.35% | | Mr. Ye Hongli | Jointly held interest with other parties | 429,714,000 | 36.52% | | Mr. Fang Zhiguo | Jointly held interest with other parties | 429,714,000 | 36.52% | | Mr. Chen Haiyan | Jointly held interest with other parties | 429,714,000 | 36.52% | | Harvest Delicacy | Beneficial owner | 70,283,600 | 5.97% | - Mr. Wang Shugao is the sole director of each British Virgin Islands entity and is therefore deemed to be interested in 85.00% of the company's shares[75] - Mr. Wang Shugao and other individual shareholders (including Li Daoqing, Tian Chunyong, Zhou Bin, Tao Xu'an, Ye Hongli, Fang Zhiguo, Wang Weifang, and Chen Haiyan) have entered into a concert party agreement to jointly hold interests in XCY Yongqing Limited[77][80] Use of Proceeds from Global Offering The company listed in December 2024, with net proceeds from the global offering of approximately HKD 794.8 million, of which HKD 140 million had been used as of June 30, 2025, primarily for enhancing supply chain capabilities and expanding the store network, with the intended use of proceeds unchanged and remaining funds held in short-term interest-bearing accounts - The net proceeds from the global offering were approximately HKD 794.8 million, with HKD 140.0 million cumulatively utilized as of June 30, 2025[82] Use of Proceeds from Global Offering and Application Status | Use of Proceeds | Percentage of Proceeds | Net Proceeds (HKD million) | Unused Amount as of Dec 31, 2024 (HKD million) | Amount Used for Six Months Ended Jun 30, 2025 (HKD million) | Cumulative Amount Used as of Jun 30, 2025 (HKD million) | Unused Amount as of Jun 30, 2025 (HKD million) | Expected Timeline for Full Utilization of Unused Proceeds | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Continuous expansion of our store network | 40.0% | 317.9 | 317.9 | 57.9 | 57.9 | 260.0 | December 31, 2026 | | Enhancement of supply chain capabilities | 37.0% | 294.1 | 294.1 | 77.6 | 77.6 | 216.5 | December 31, 2026 | | Upgrade of our smart equipment and digitalization systems | 13.0% | 103.3 | 103.3 | 4.5 | 4.5 | 98.8 | December 31, 2026 | | Working capital and general corporate purposes | 10.0% | 79.5 | 79.5 | 0 | 0 | 79.5 | December 31, 2026 | | Total | 100% | 794.8 | 794.8 | 140.0 | 140.0 | 654.8 | | - The unutilized net proceeds are deposited in short-term interest-bearing accounts opened with licensed commercial banks and/or other authorized financial institutions[82] Other Corporate Governance Matters The company has not adopted any share schemes, no material events occurred after the reporting period, and the Audit Committee has reviewed the interim results, with the interim report published on the Stock Exchange and the company's website - The company has not adopted any share schemes[83] - No material events affecting the Group have occurred from June 30, 2025, up to the latest practicable date[84] - The Audit Committee has reviewed the Group's unaudited condensed consolidated interim results and interim report for the six months ended June 30, 2025[85] Independent Auditor's Report This section presents the independent auditor's review report on the company's interim financial information Introduction KPMG has reviewed Xiaocaiyuan International Holdings Limited's interim financial report for the six months ended June 30, 2025, prepared in accordance with the Hong Kong Stock Exchange Listing Rules and IAS 34, with the Board responsible for its preparation and the auditor's responsibility to conclude based on the review - KPMG has reviewed the company's interim financial report for the six months ended June 30, 2025[88] - The interim financial report was prepared in accordance with the Hong Kong Stock Exchange Listing Rules and IAS 34, with directors responsible for its preparation and presentation[88] Scope of Review and Conclusion The review was conducted in accordance with Hong Kong Standard on Review Engagements 2410, which is less in scope than an audit, thus no audit opinion is expressed, and based on the review, the auditor found no matters indicating that the interim financial report was not prepared in accordance with IAS 34 - The review was conducted in accordance with Hong Kong Standard on Review Engagements 2410 issued by the HKICPA, which is less in scope than an audit, and therefore no audit opinion is expressed[89] - Based on the review, the auditor did not note any matters that caused them to believe the interim financial report was not prepared in all material respects in accordance with IAS 34[90] Consolidated Financial Statements This section presents the company's consolidated financial statements, including the statements of profit or loss, comprehensive income, financial position, changes in equity, and cash flows Consolidated Statement of Profit or Loss For the six months ended June 30, 2025, the company reported revenue of RMB 2.714 billion, profit for the period of RMB 382 million, and basic and diluted earnings per share of RMB 0.33 Summary of Consolidated Statement of Profit or Loss | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Revenue | 2,713,666 | 2,547,463 | | Profit before tax | 542,313 | 380,860 | | Profit for the period | 382,397 | 281,879 | | Basic EPS (RMB) | 0.33 | 0.27 | | Diluted EPS (RMB) | 0.33 | 0.27 | Consolidated Statement of Profit or Loss and Other Comprehensive Income For the six months ended June 30, 2025, the company's profit for the period was RMB 382 million, with other comprehensive income of RMB (258) thousand, resulting in a total comprehensive income for the period of RMB 382 million Summary of Consolidated Statement of Profit or Loss and Other Comprehensive Income | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Profit for the period | 382,397 | 281,879 | | Other comprehensive income for the period | (258) | 584 | | Total comprehensive income for the period | 382,139 | 282,463 | Consolidated Statement of Financial Position As of June 30, 2025, the company's total assets were RMB 3.695 billion, with current assets at RMB 2.213 billion, total liabilities at RMB 1.323 billion, current liabilities at RMB 737 million, and net assets at RMB 2.373 billion Summary of Consolidated Statement of Financial Position | Indicator | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Non-current assets | 1,481,987 | 1,548,174 | | Current assets | 2,213,462 | 2,039,726 | | Current liabilities | 736,939 | 606,688 | | Non-current liabilities | 585,956 | 615,797 | | Net assets | 2,372,554 | 2,365,415 | | Total equity | 2,372,554 | 2,365,415 | Consolidated Statement of Changes in Equity For the six months ended June 30, 2025, the company's total equity increased from RMB 2.365 billion at the beginning of the year to RMB 2.373 billion, primarily influenced by a profit for the period of RMB 382 million and a dividend payment of RMB 375 million Summary of Consolidated Statement of Changes in Equity | Indicator | Balance as of Jan 1, 2025 (RMB thousand) | Profit for the period (RMB thousand) | Dividends declared (RMB thousand) | Balance as of Jun 30, 2025 (RMB thousand) | | :--- | :--- | :--- | :--- | :--- | | Total | 2,365,415 | 382,397 | (375,000) | 2,372,554 | Condensed Consolidated Statement of Cash Flows For the six months ended June 30, 2025, net cash generated from operating activities was RMB 765 million, net cash used in investing activities was RMB 327 million, and net cash used in financing activities was RMB 415 million, resulting in a net increase in cash and cash equivalents of RMB 22.3 million Summary of Condensed Consolidated Statement of Cash Flows | Activity | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Net cash generated from operating activities | 764,750 | 454,967 | | Net cash used in investing activities | (326,953) | (410,382) | | Net cash used in financing activities | (415,468) | (229,293) | | Net increase/(decrease) in cash and cash equivalents | 22,329 | (184,708) | | Cash and cash equivalents at June 30 | 638,829 | 436,033 | Notes to the Unaudited Interim Financial Report This section provides detailed notes to the unaudited interim financial report, covering accounting policies, revenue breakdown, expense analysis, and other financial disclosures Basis of Preparation and Changes in Accounting Policies This interim financial report is prepared in accordance with IAS 34 and has been reviewed by KPMG, with the IAS 21 amendment applied during this period having no material impact on the Group - This interim financial report is prepared in accordance with the Hong Kong Stock Exchange Listing Rules and IAS 34, and has been reviewed by KPMG[107][108] - The Group has applied the IAS 21 amendment "The Effects of Changes in Foreign Exchange Rates – Lack of Exchangeability" for this accounting period, with no material impact[109] Revenue and Other Income The company's revenue primarily derives from dine-in and takeaway businesses, both recognized at a point in time, while other income, mainly comprising bank deposit interest, wealth management product investment gains, and government grants, decreased in total this period Disaggregation of Revenue from Contracts with Customers by Major Product or Service Line | Business Line | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Dine-in business | 1,647,139 | 1,611,603 | | Takeaway business | 1,057,411 | 929,709 | | Others | 9,116 | 6,151 | | Total | 2,713,666 | 2,547,463 | Details of Other Income | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Bank deposit interest income | 4,313 | 10,860 | | Investment income from wealth management products | 3,282 | 1,290 | | Government grants | 6,542 | 9,596 | | Total | 15,156 | 22,784 | Components of Profit Before Tax Profit before tax is influenced by finance costs, staff costs, other expenses, and other net income, with staff costs and some other expenses decreasing, finance costs remaining stable, and other net income significantly declining due to reduced fair value gains Details of Finance Costs | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Interest on bank loans | 615 | 354 | | Interest on lease liabilities | 18,832 | 18,970 | | Interest on provisions | 708 | 675 | | Total | 20,155 | 19,999 | Details of Staff Costs | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Salaries, wages and other benefits | 650,792 | 709,753 | | Contributions to defined contribution retirement plans | 15,604 | 16,520 | | Total | 666,396 | 726,273 | Details of Other Expenses | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Property management expenses | 68,631 | 65,089 | | Transportation and related expenses | 15,469 | 14,476 | | Administrative expenses | 2,090 | 6,094 | | Professional service expenses | 2,904 | 3,937 | | Listing expenses | – | 9,419 | | Cleaning fees | 6,930 | 7,024 | | Taxes and surcharges | 8,283 | 6,061 | | Business development expenses | 3,442 | 3,179 | | Impairment loss on property, plant and equipment and right-of-use assets | – | 471 | | Others | 8,030 | 5,747 | | Total | 115,779 | 121,497 | Details of Other Net Income | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Net loss on disposal of property, plant and equipment and right-of-use assets | 8,358 | 6,144 | | Change in carrying amount of redemption liabilities | – | 19,504 | | Fair value change of convertible bonds and derivative financial instruments | – | (46,437) | | Fair value change of financial assets at fair value through profit or loss | (15,659) | – | | Exchange loss/(gain) | 1,910 | (430) | | Other losses/(income) | 2,611 | (6,194) | | Total | (2,780) | (27,413) | Income Tax and Earnings Per Share Income tax expense significantly increased due to higher PRC dividend withholding tax, with both basic and diluted earnings per share at RMB 0.33, showing growth compared to the prior period Details of Income Tax | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Current tax | 133,270 | 93,912 | | Deferred tax | 26,646 | 5,069 | | Total | 159,916 | 98,981 | - Certain subsidiaries qualify for preferential income tax rates for small and micro enterprises in China, with taxable income up to RMB 3 million taxed at a 5% rate[118] - Basic earnings per share are calculated based on profit attributable to ordinary equity shareholders of RMB 382,397,000 and a weighted average of 1,176,519,000 ordinary shares outstanding[121] - For the six months ended June 30, 2025, diluted earnings per share were the same as basic earnings per share, as there were no potentially dilutive ordinary shares[122] Property, Plant and Equipment and Right-of-Use Assets The cost of property, plant and equipment acquired this period was RMB 96.5 million, while right-of-use assets increased by RMB 60.2 million due to multiple lease agreements, and no impairment loss was recognized this period, compared to RMB 471 thousand in the prior period - For the six months ended June 30, 2025, the Group's cost of acquiring property, plant and equipment items was RMB 96,514,000[123] - Right-of-use assets increased by RMB 60,233,000, primarily due to the signing of multiple restaurant and warehouse lease agreements[124] - For the six months ended June 30, 2025, no impairment loss was recognized (prior period: RMB 471,000)[125] Details of Current Assets and Liabilities Inventories and trade and other receivables both decreased, reflecting improved supply chain management efficiency, while financial assets at fair value through profit or loss significantly increased, primarily due to wealth management product investments, and trade and other payables and contract liabilities also changed Inventory Composition | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Food ingredients | 52,453 | 82,738 | | Seasonings | 9,947 | 13,375 | | Beverages | 3,990 | 3,507 | | Others | 7,724 | 9,946 | | Total | 74,114 | 109,566 | Ageing Analysis of Trade and Other Receivables | Ageing | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Within 1 month | 27,827 | 28,116 | | 1 to 3 months | 1,993 | 1,832 | | 3 to 6 months | 998 | 367 | | Over 6 months but within 1 year | 532 | 415 | | Trade receivables | 31,350 | 30,730 | | Other receivables and deposits | 69,089 | 84,678 | | Prepayments | 118,096 | 173,715 | | Deductible VAT | 15,341 | 12,740 | | Total | 233,876 | 301,863 | - Financial assets at fair value through profit or loss increased to RMB 1.191 billion, primarily investments in funds and bank wealth management products, including net unrealized gains of RMB 15,659,000[129] Cash and Cash Equivalents | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Cash on hand | 4 | 10 | | Cash at bank | 714,825 | 840,007 | | Less: Time deposits | (76,000) | (223,356) | | Total | 638,829 | 616,661 | Bank Loans and Other Borrowings | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Within one year or on demand | 100,000 | – | Ageing Analysis of Trade and Other Payables | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Trade payables (within one year) | 86,463 | 56,932 | | Accrued staff costs | 108,411 | 96,992 | | Other taxes payable | 10,886 | 11,142 | | Other payables and accrued expenses | 65,088 | 63,434 | | Total | 270,848 | 228,500 | Contract Liabilities | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Contract liabilities related to prepaid cards | 70,797 | 74,122 | | Contract liabilities related to customer loyalty programs | 1,599 | 3,212 | | Total | 72,396 | 77,334 | Capital, Reserves and Dividends The Board has approved an interim dividend of RMB 0.2119 per share, and the company's share capital structure underwent changes in 2024, including a share split, initial public offering, and conversion of convertible preference shares into ordinary shares - The Board has approved an interim dividend of RMB 0.2119 per ordinary share, totaling RMB 250,000 thousand, to be paid after the interim period[135] - On December 2, 2024, the company's shares with a par value of USD 1 per share were subdivided into 100,000 shares with a par value of USD 0.00001 per share[137] - On December 20, 2024, the company issued 101,181,000 ordinary shares through its listing, with net proceeds of approximately RMB 776,579,000[137] - Upon completion of the listing, 753.38 preference shares were converted into 75,338,000 ordinary shares[137] Fair Value Measurement of Financial Instruments The Group's financial instruments are measured at fair value, primarily financial assets at fair value through profit or loss, classified as Level 2 valuations, with their fair values determined by recent comparable market transaction prices - The Group's financial instruments' fair value measurements are categorized into three levels: Level 1 (quoted prices in active markets), Level 2 (observable inputs other than quoted prices in active markets), and Level 3 (significant unobservable inputs)[139] Fair Value Measurement of Financial Assets at Fair Value Through Profit or Loss | Item | Fair Value as of Jun 30, 2025 (RMB thousand) | Level 1 (RMB thousand) | Level 2 (RMB thousand) | Level 3 (RMB thousand) | | :--- | :--- | :--- | :--- | :--- | | Financial assets at fair value through profit or loss | 1,190,643 | – | 1,190,643 | – | - The fair value of Level 2 wealth management products is determined by recent comparable market transaction prices[142] Commitments and Related Party Transactions As of June 30, 2025, the company's contracted commitments for property, plant and equipment acquisitions amounted to RMB 190 million, and total key management personnel compensation was RMB 4.318 million Unfulfilled Commitments | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Contracted for acquisition of property, plant and equipment | 189,967 | 128,424 | Key Management Personnel Compensation | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Short-term employee benefits | 4,133 | 2,015 | | Contributions to defined contribution retirement plans | 185 | 80 | | Total | 4,318 | 2,095 | Non-Adjusting Events After the Reporting Period Subsequent to the reporting period, the directors resolved to declare an interim dividend, with details disclosed in Note 16(a) - Subsequent to the end of the reporting period, the directors resolved to declare an interim dividend[145] Definitions This section provides definitions for key terms and abbreviations used throughout the report to ensure consistent understanding Definition of Terms This section provides definitions for key terms and abbreviations used in the report, including company names, geographical areas, legal entities, financial reporting standards, and regulatory bodies, to ensure consistent understanding of the report's content - This section defines key terms used in the report, such as "the Company" (Xiaocaiyuan International Holdings Limited), "the Group" (the Company and its subsidiaries), and "PRC" (the People's Republic of China)[146][148][149][151] - It covers definitions related to corporate governance, securities transactions, financial reporting standards (such as IFRS), and major shareholders[146][148][149][151]