星盛商业(06668) - 2025 - 中期财报

Company Information This section provides an overview of Star Properties Commercial Management Co., Ltd.'s governance structure and fundamental corporate details Board of Directors and Committees This section lists the members of the Board of Directors, including executive, non-executive, and independent non-executive directors, along with the composition of its Audit, Remuneration, and Nomination Committees - Board members include Huang Delin (Chairman), Chen Qunsheng (CEO), Ma Chaoqun (Executive Director), Liu Jun, Huang Dean (Non-executive Directors), and Zhang Jinghua, Guo Zengli, Wen Kailin (Independent Non-executive Directors)[5] - The company has an Audit Committee (Wen Kailin as Chairman), a Remuneration Committee (Guo Zengli as Chairman), and a Nomination Committee (Huang Delin as Chairman)[5] Company Basic Information This section provides essential company details such as its registered office, Hong Kong and China business locations, share registrar, principal bankers, legal counsel, and website - Company's registered office is in Cayman Islands, Hong Kong business location is in Wing On Centre, Sheung Wan, and main China business location is in Galaxy WORLD, Longgang District, Shenzhen[5] - Independent auditor is Deloitte Touche Tohmatsu, and principal bankers include Industrial and Commercial Bank of China, China Construction Bank, and Ping An Bank[5][6] Management Discussion and Analysis This section provides a comprehensive review of the Group's business operations, financial performance, strategic plans, and key developments for the reporting period Overview Star Properties Commercial Management Co., Ltd. is a leading commercial property operation service provider in the Greater Bay Area, managing 52 projects across 21 cities with a total contracted GFA of approximately 2.65 million square meters, and received multiple industry honors in H1 2025 - As of June 30, 2025, the Group provided services to 52 commercial property projects, covering 21 cities in China, with a total contracted GFA of approximately 2.65 million square meters[7] - Approximately 45.8% of the contracted GFA is developed or owned by independent third parties, including 27 operational retail commercial properties with a total operational GFA of approximately 1.65 million square meters[7] - In H1 2025, the Group received multiple industry honors, including "Top 10 Commercial Real Estate Operators in China 2025" from China Index Academy[8] Business Review The Group, as a commercial property operation service provider, offers services through entrusted management, brand and management output, and master lease models, managing 52 projects with a total contracted GFA of 2.647 million square meters, primarily in the Greater Bay Area, and achieving an average occupancy rate of 92.5% for operational retail commercial properties - The Group provides market positioning, design and construction consulting, tenant solicitation, operation management, property leasing, and value-added services[10] - Entrusted management model offers high autonomy for ideal performance; brand and management output model has higher gross profit margin for rapid regional expansion; master lease service model maximizes revenue but carries higher risks[12][14][18] Contracted GFA and Number of Properties by Operation Model (As of June 30, 2025) | Operation Model | Number of Properties | Contracted GFA (thousand sq.m.) | | :--- | :--- | :--- | | Entrusted Management Services | 12 | 886 | | Brand and Management Output Services | 33 | 1,345 | | Master Lease Services | 7 | 416 | | Total | 52 | 2,647 | Contracted GFA and Revenue by Geographical Location (For the six months ended June 30, 2025) | Region | Number of Properties | Contracted GFA (sq.m.) | Revenue (RMB thousand) | Revenue Share (%) | | :--- | :--- | :--- | :--- | :--- | | Greater Bay Area | 32 | 1,500,000 | 212,938 | 74.9 | | Yangtze River Delta | 9 | 422,000 | 42,499 | 15.0 | | Other Regions | 10 | 725,000 | 28,792 | 10.1 | | Total | 52 | 2,647,000 | 284,229 | 100.0 | Average Occupancy Rate and Operational GFA of Operational Retail Commercial Properties (As of June 30, 2025) | Product Type | Average Occupancy Rate (%) | Operational Shopping Mall GFA (thousand sq.m.) | | :--- | :--- | :--- | | COCO Park | 93.9 | 494 | | COCO City and iCO | 90.9 | 576 | | Others | 93.7 | 235 | | Total | 92.5 | 1,305 | Star Properties Commercial H2 2025 Work Plan In H2 2025, Star Properties Commercial will focus on "Cost-Efficiency Year" and "Focus Strategy," with core work revolving around enhancing asset value, strengthening digital intelligence capabilities, reinforcing cost awareness, and deepening regional expansion - Core work for H2 2025 focuses on enhancing asset value, improving digital intelligence capabilities, strengthening cost awareness, and deepening regional expansion[28] Enhance Asset Value, Solidify Benchmark Status The Group plans to continuously advance key project adjustments and brand optimization to consolidate benchmark status, adopt diversified tenant attraction strategies, strengthen operational revenue generation, optimize service systems, and strictly control the timely and quality opening of new projects - Key projects like Shenzhen Futian Galaxy COCO Park will solidify benchmark status through apparel upgrades, F&B and trendy play renovations, and partial transformations[28] - Adopt diversified tenant attraction strategies such as "strategic co-development," "first-entry brands," and "innovative brands," and implement "one-store-one-policy" solutions to improve occupancy rates and rental income[30] - Expand diversified revenue channels, develop and utilize commercial advertising spaces, venue rentals, value-added services, and engage in external cooperation for commercial consulting and training[31] - Three new projects, Shenzhen Guangming Galaxy COCO City, Shenzhen Galaxy WORLD•COCO Park Phase II, and Nanjing Galaxy COCO City, are planned to open in H2, with strict control over construction and preparation phases[33] Enhance Digital Intelligence Capabilities, Drive Business Growth The Group will continue to optimize its smart commercial system, upgrade the B-side "Star Butler" mini-program, integrate financial and tenant attraction systems to build a leasing settlement (ERP) system, strengthen C-side marketing platforms, refine data mid-platform management, and deploy IoT sensors to improve operational efficiency and energy saving - B-side "Star Butler" mini-program will be upgraded, adding modules for key renovation node management, knowledge platform, and store operation guidance, enabling online and paperless merchant services[34] - Integrate financial management system, tenant attraction management system, etc., to build a leasing settlement (ERP) system, achieving integrated financial and business operations[34] - Refine data mid-platform management standards, introduce AI algorithms to optimize data applications, promote iterative upgrades of the BI data platform, and deploy IoT temperature and humidity sensors to save energy[35] Strengthen Cost Awareness, Optimize Resource Allocation The Group will strengthen cost awareness, meticulously manage costs during new project preparation, focus on energy saving and consumption reduction for operational projects, and deeply advance the "Baichuan Plan" to refine parking lot revenue management, optimize charging strategies, and smart equipment applications - Strengthen cost awareness during new project preparation, precisely plan capital investment, optimize costs, and avoid ineffective expenditures[36] - Operational projects will reduce energy consumption through air conditioning energy-saving renovations, optimized operating logic, strengthened equipment maintenance, and implementation of variable frequency technology[36] - Advance the "Baichuan Plan," refine parking lot revenue structure management, optimize charging strategies and smart equipment applications, reduce labor costs, and increase revenue[37] Deepen Regional Cultivation and Expansion, Innovate Business for Efficiency The Group will continue to follow the "14th Five-Year Plan" strategic direction, deeply cultivate the Greater Bay Area market, opportunistically develop the Yangtze River Delta region, steadily develop its core business, continuously advance standardized asset-light business, and explore new opportunities in community and non-standard commercial projects - Continue "14th Five-Year Plan" strategic direction, deepen, densify, and strengthen the Greater Bay Area, opportunistically develop the Yangtze River Delta, and formulate targeted expansion strategies[38] - Continuously advance standardized asset-light business, explore new opportunities in community and non-standard commercial projects, and promote diversified development of integrated projects[39] - Explore innovative asset-light business models, expand non-listed commercial full-process consulting services, phased split specialized service projects, and enhance business competitiveness[39] Events After Reporting Period As of June 30, 2025, and up to the date of this report, no significant events have occurred that would materially affect the Group's operations and financial performance - As of June 30, 2025, and up to the date of this report, no events have occurred that would materially affect the Group's operations and financial performance[40] Financial Review For the six months ended June 30, 2025, the Group's revenue decreased by 9.4% to RMB 284.2 million, with service costs down 10.8%, gross profit down 8.2% but margin up to 52.3%, and profit for the period slightly down 0.5% to RMB 86.1 million, while trade receivables increased and payables decreased, and global offering proceeds were primarily used for master lease property leasing and renovation Revenue Overview (For the six months ended June 30) | Metric | 2025 (RMB thousand) | 2024 (RMB thousand) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Total Revenue | 284,229 | 313,780 | -9.4% | | Entrusted Management Service Revenue | 185,706 | 209,691 | -11.4% | | Brand and Management Output Service Revenue | 34,439 | 43,458 | -20.8% | | Master Lease Service Revenue | 64,084 | 60,631 | +5.7% | - Service costs decreased by 10.8% year-on-year to RMB 135.5 million, primarily due to fewer entrusted management projects and refined operational cost reduction and efficiency improvement[43] Gross Profit and Gross Profit Margin (For the six months ended June 30) | Metric | 2025 (RMB thousand) | 2025 Gross Profit Margin (%) | 2024 (RMB thousand) | 2024 Gross Profit Margin (%) | | :--- | :--- | :--- | :--- | :--- | | Total Gross Profit | 148,681 | 52.3 | 161,880 | 51.6 | | Entrusted Management Service Gross Profit | 107,144 | 57.7 | 121,503 | 57.9 | | Brand and Management Output Service Gross Profit | 25,835 | 75.0 | 32,675 | 75.2 | | Master Lease Service Gross Profit | 15,702 | 24.5 | 7,702 | 12.7 | | Overall Gross Profit Margin Change | | +0.7 percentage points | | | - Profit for the period was approximately RMB 86.1 million, a year-on-year decrease of 0.5%; profit attributable to owners of the Company was approximately RMB 86.9 million, a year-on-year decrease of 2.5%[55] - Trade and other receivables increased by 7.5% to RMB 47.3 million, mainly due to increased engineering investment in pre-opening projects and differences in management service fee settlement cycles[56] - Trade and other payables decreased by 22.0% to RMB 223.2 million, mainly due to payment of year-end bonuses accrued in the previous year and various payables[57] - Net proceeds from the global offering were approximately RMB 841.8 million, of which RMB 471.8 million had been utilized as of June 30, 2025, primarily for retail commercial property leasing fees and renovation under the master lease service model[65] Number of Employees and Remuneration Policy As of June 30, 2025, the Group's total number of employees was 840, a decrease from 954 at the end of 2024, with remuneration based on qualifications, experience, job nature, performance, and market compensation, including various benefits and share-based payment expenses of RMB 981,000 in H1 2025 Total Number of Employees | Date | Total Number of Employees | | :--- | :--- | | June 30, 2025 | 840 | | December 31, 2024 | 954 | - Remuneration is based on qualifications, experience, job nature, performance, and market compensation, including cash performance bonuses, medical plans, insurance, retirement plans, share option schemes, and restricted share unit awards[67] - In H1 2025, employee costs included share-based payment expenses of approximately RMB 981,000, an increase from RMB 402,000 in the same period of 2024[67] Future Plans for Material Investments and Capital Assets For the six months ended June 30, 2025, the Group had no specific plans for other material investments or acquisitions of major capital assets or other businesses, apart from the expansion plans disclosed in the prospectus - Apart from the expansion plans in the prospectus, the Group has no specific plans for material investments or acquisitions of major capital assets or other businesses[68] Material Investments, Acquisitions and Disposals of Subsidiaries, Associates and Joint Ventures For the six months ended June 30, 2025, the Group did not undertake any material investments, acquisitions, or disposals of subsidiaries, associates, and joint ventures - For the six months ended June 30, 2025, the Group had no material investments, material acquisitions, or disposals of subsidiaries, associates, and joint ventures[69] Pledges of Assets As of June 30, 2025, the Group had not pledged any assets - As of June 30, 2025, the Group had not pledged any assets[70] Corporate Governance and Other Information This section outlines the Company's adherence to corporate governance standards, directors' interests, share schemes, and dividend policies Compliance with Corporate Governance Code and Listing Rules For the six months ended June 30, 2025, the Company's directors believe that good corporate governance principles have been applied, and the provisions of the Corporate Governance Code set out in Appendix C1 of the Listing Rules have been complied with - The Company has applied good corporate governance principles and complied with the provisions of the Corporate Governance Code set out in Appendix C1 of the Listing Rules[71] Compliance with the Model Code for Securities Transactions by Directors The Company has adopted the Model Code for Securities Transactions by Directors, and all directors confirmed compliance for the six months ended June 30, 2025, with no instances of non-compliance by relevant employees found - All directors confirmed compliance with the Model Code for the six months ended June 30, 2025[72] - The Company found no instances of non-compliance by relevant employees with the Model Code[72] Changes in Directors' Information For the six months ended June 30, 2025, and up to the date of this report, there were no changes in the Company's directors' information requiring disclosure under Listing Rule 13.51B(1) - For the six months ended June 30, 2025, and up to the date of this report, no changes in directors' information required disclosure under Listing Rule 13.51B(1)[73] Review of Interim Report The unaudited interim financial information for the six months ended June 30, 2025, has been reviewed by Deloitte Touche Tohmatsu and jointly reviewed by the Audit Committee and management, discussing matters such as accounting principles, internal controls, risk management, and financial reporting - The interim financial information has been reviewed by Deloitte Touche Tohmatsu and jointly reviewed by the Audit Committee and management[74] Share Capital As of June 30, 2025, the Company's total issued share capital was 1,014,516,000 ordinary shares - As of June 30, 2025, the Company's total issued share capital was 1,014,516,000 ordinary shares[75] 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 any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[76] - As of June 30, 2025, and the date of this report, the Company held no treasury shares[77] Directors' and Chief Executive's Interests and Short Positions in Shares, Underlying Shares and Debentures of the Company or any Associated Corporation As of June 30, 2025, the Company's directors and chief executive held interests in the Company's shares, with Mr. Huang Delin holding 14.66%, Mr. Huang Dean 0.18%, Mr. Chen Qunsheng 0.02%, Mr. Ma Chaoqun 0.01%, and Mr. Liu Jun 0.02% Directors' Interests in the Company's Shares (As of June 30, 2025) | Director's Name | Capacity/Nature of Interest | Number of Shares | Approximate Percentage of Issued Share Capital | | :--- | :--- | :--- | :--- | | Mr. Huang Delin | Interest in controlled corporation/Settlor of discretionary trust/Beneficial owner | 148,682,000 (L) | 14.66% | | Mr. Huang Dean | Beneficial owner | 1,791,000 (L) | 0.18% | | Mr. Chen Qunsheng | Beneficial owner | 212,000 (L) | 0.02% | | Mr. Ma Chaoqun | Beneficial owner | 80,000 (L) | 0.01% | | Mr. Liu Jun | Beneficiary of trust | 200,000 (L) | 0.02% | Interests and Short Positions of Persons Other Than Directors and Chief Executive in Shares and Underlying Shares As of June 30, 2025, Mr. Huang Chulong and his controlled entities held significant interests in the Company's shares, with Mr. Huang Chulong holding a total of 73.89% and Gaoxing Investment Holdings Co., Ltd. holding 59.24% Interests of Persons Other Than Directors and Chief Executive in the Company's Shares (As of June 30, 2025) | Shareholder Name | Capacity/Nature of Interest | Number of Shares | Approximate Percentage of Issued Share Capital | | :--- | :--- | :--- | :--- | | Mr. Huang | Settlor of discretionary trust/Interest in controlled corporation | 749,596,000 (L) | 73.89% | | TMF (Cayman) Ltd | Trustee | 601,000,000 (L) | 59.24% | | Long Harmony Holding Limited | Interest in controlled corporation | 601,000,000 (L) | 59.24% | | Gaoxing Investment Holdings Co., Ltd. | Beneficial owner | 601,000,000 (L) | 59.24% | | Derui Investment | Beneficial owner/Trustee | 147,303,000 (L) | 14.52% | Share Award Scheme The Company's controlling shareholder, Mr. Huang Chulong, adopted a share award scheme on April 17, 2023, to incentivize and reward eligible participants, funded by entrusted shares held by Derui Investment, with 54,800,000 award shares granted and 5,220,000 remaining unexercised as of June 30, 2025 - The Share Award Scheme was adopted by controlling shareholder Mr. Huang Chulong on April 17, 2023, to incentivize and reward eligible participants who have contributed to the Group[84] - The scheme does not involve the issuance of new shares and is funded by entrusted shares held by Derui Investment[85] Changes in Awarded Shares under Share Award Scheme (As of June 30, 2025) | Status | Number of Awarded Shares | | :--- | :--- | | Unexercised as at January 1, 2024 | 12,495,000 | | Forfeited during the period | (2,450,000) | | Unexercised as at June 30, 2024 | 10,045,000 | | Forfeited during the period | (560,000) | | Unexercised as at December 31, 2024 | 9,485,000 | | Forfeited during the period | (350,000) | | Exercised during the period | (1,112,000) | | Lapsed during the period | (2,803,000) | | Unexercised as at June 30, 2025 | 5,220,000 | Share Option Scheme The Company adopted a share option scheme on December 21, 2020, to incentivize and reward eligible participants, but as of June 30, 2025, no share options had been granted or remained unexercised, with 100,000,000 shares available for grant - The Share Option Scheme was adopted on December 21, 2020, to incentivize and reward eligible participants who have contributed to the Group's business[87] - As of June 30, 2025, the Company had not granted any share options under the Share Option Scheme, and no share options remained unexercised on that date[87] - As of June 30, 2025, the total number of share options available for grant under the Share Option Scheme was 100,000,000 shares, representing approximately 9.86% of the issued share capital[87] Restricted Share Unit ("RSU") Scheme ("RSU Scheme") The Company adopted a Restricted Share Unit Scheme on November 4, 2021, to recognize and reward contributors, having cumulatively purchased 1,937,000 shares for the scheme as of June 30, 2025, but without granting any restricted share units - The Restricted Share Unit Scheme was adopted on November 4, 2021, to recognize and reward eligible participants who have contributed to the Group[88] - As of June 30, 2025, the Company had cumulatively purchased 1,937,000 shares for the scheme[88] - As of June 30, 2025, no restricted share units had been granted under the Restricted Share Unit Scheme[89] Interim Dividend and Closure of Register of Members The Board declared an interim dividend of HKD 5.0 cents per ordinary share for the six months ended June 30, 2025, with the register of members to be closed from November 28 to December 1, 2025, and payment expected around December 19, 2025 Interim Dividend | Period | Dividend per Ordinary Share | | :--- | :--- | | For the six months ended June 30, 2025 | HKD 5.0 cents | | For the six months ended June 30, 2024 | HKD 4.8 cents | - The register of members will be closed from November 28, 2025, to December 1, 2025[90] - The proposed interim dividend is expected to be paid on or about December 19, 2025, to shareholders whose names appear on the register of members at the close of business on December 1, 2025[90] Review Report on Condensed Consolidated Financial Statements This section presents the independent auditor's review report on the condensed consolidated financial statements, including the scope and conclusion of their work Introduction Deloitte Touche Tohmatsu has reviewed Star Properties Commercial Management Co., Ltd.'s condensed consolidated financial statements for the six months ended June 30, 2025, prepared in accordance with HKAS 34 and Listing Rules, with the Board responsible for preparation and the auditor for conclusion based on the review - Deloitte Touche Tohmatsu has reviewed the condensed consolidated financial statements for the six months ended June 30, 2025[91] - The financial statements are prepared in accordance with Hong Kong Accounting Standard 34 and the applicable disclosure requirements of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[91] Scope of Review The review was conducted in accordance with Hong Kong Standard on Review Engagements 2410, primarily involving inquiries and analytical procedures, and as its scope is less than an audit, no audit opinion is expressed - The review was conducted in accordance with Hong Kong Standard on Review Engagements 2410, primarily involving inquiries and analytical review procedures[92] - The scope of a review is less than an audit, therefore no audit opinion is expressed[92] Conclusion Based on the review, the auditor found no matters that would lead them to believe the condensed consolidated financial statements are not prepared, in all material respects, in accordance with HKAS 34 - The auditor found no matters that would lead them to believe the condensed consolidated financial statements are not prepared, in all material respects, in accordance with Hong Kong Accounting Standard 34[93] Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income This section presents the Group's condensed consolidated statement of profit or loss and other comprehensive income for the reporting period Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income For the six months ended June 30, 2025, the Group's revenue was RMB 284,229 thousand, a 9.4% year-on-year decrease, with gross profit at RMB 148,681 thousand (down 8.2%), and profit and total comprehensive income for the period at RMB 86,053 thousand (down 0.5%), resulting in basic earnings per share of RMB 8.58 cents Key Data from Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (For the six months ended June 30) | Metric | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Revenue | 284,229 | 313,780 | | Service costs | (135,548) | (151,900) | | Gross profit | 148,681 | 161,880 | | Other income | 15,585 | 18,745 | | Selling expenses | (6,676) | (14,688) | | Administrative expenses | (26,346) | (31,752) | | Finance costs | (18,451) | (18,144) | | Profit before tax | 110,955 | 113,870 | | Income tax expense | (24,902) | (27,374) | | Profit and total comprehensive income for the period | 86,053 | 86,496 | | Profit for the period attributable to owners of the Company | 86,896 | 89,100 | | Basic earnings per share (RMB cents) | 8.58 | 8.80 | Condensed Consolidated Statement of Financial Position This section presents the Group's condensed consolidated statement of financial position as of the reporting date Condensed Consolidated Statement of Financial Position As of June 30, 2025, the Group's total assets less current liabilities were RMB 1,936,106 thousand, with non-current assets primarily investment properties, current assets showing increased short-term bank deposits and decreased cash, total equity at RMB 1,265,610 thousand, and non-current liabilities mainly lease liabilities Key Data from Condensed Consolidated Statement of Financial Position (As of June 30, 2025) | Metric | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Non-current assets | 869,095 | 860,974 | | Current assets | 1,425,297 | 1,417,359 | | Current liabilities | 358,286 | 359,562 | | Net current assets | 1,067,011 | 1,057,797 | | Total assets less current liabilities | 1,936,106 | 1,918,771 | | Total equity | 1,265,610 | 1,255,684 | | Non-current liabilities | 670,496 | 663,087 | - Short-term bank deposits increased from RMB 655,905 thousand at the end of 2024 to RMB 870,808 thousand as of June 30, 2025[96] - Cash and cash equivalents decreased from RMB 710,599 thousand at the end of 2024 to RMB 497,609 thousand as of June 30, 2025[96] Condensed Consolidated Statement of Changes in Equity This section presents the Group's condensed consolidated statement of changes in equity for the reporting period Condensed Consolidated Statement of Changes in Equity For the six months ended June 30, 2025, equity attributable to owners of the Company increased from RMB 1,246,877 thousand to RMB 1,257,646 thousand, driven by RMB 86,896 thousand in profit for the period and RMB 981 thousand in share-based payment reserve, offset by RMB 77,108 thousand in dividend distribution Key Data from Condensed Consolidated Statement of Changes in Equity (For the six months ended June 30) | Metric | January 1, 2025 (RMB thousand) | June 30, 2025 (RMB thousand) | | :--- | :--- | :--- | | Equity attributable to owners of the Company | 1,246,877 | 1,257,646 | | Profit (loss) and total comprehensive income for the period | - | 86,896 | | Equity-settled share-based payments recognized | - | 981 | | Dividends distributed | - | (77,108) | - Statutory reserve increased from RMB 109,880 thousand at the beginning of the period to RMB 117,228 thousand[97] - Retained profits increased from RMB 715,728 thousand at the beginning of the period to RMB 795,276 thousand[97] Condensed Consolidated Statement of Cash Flows This section presents the Group's condensed consolidated statement of cash flows for the reporting period Condensed Consolidated Statement of Cash Flows For the six months ended June 30, 2025, the Group's net cash generated from operating activities significantly decreased to RMB 38,384 thousand, while net cash used in investing activities was RMB 239,732 thousand, and cash and cash equivalents at period-end were RMB 497,609 thousand, representing a decrease of RMB 212,990 thousand from the beginning of the period Key Data from Condensed Consolidated Statement of Cash Flows (For the six months ended June 30) | Metric | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Net cash generated from operating activities | 38,384 | 71,887 | | Net cash used in investing activities | (239,732) | (271,893) | | Net cash used in financing activities | (11,642) | (14,093) | | Net decrease in cash and cash equivalents | (212,990) | (214,099) | | Cash and cash equivalents at end of period | 497,609 | 332,815 | - Cash generated from operations decreased from RMB 110,002 thousand in 2024 to RMB 78,746 thousand in 2025[99] - Placement of short-term bank deposits decreased from RMB 560,420 thousand in 2024 to RMB 333,794 thousand in 2025[100] Notes to the Condensed Consolidated Financial Statements This section provides detailed explanatory notes to the condensed consolidated financial statements, covering accounting policies, revenue, expenses, and other financial disclosures Basis of Preparation The condensed consolidated financial statements are prepared in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting" and the applicable disclosure requirements of the Listing Rules - The condensed consolidated financial statements are prepared in accordance with Hong Kong Accounting Standard 34 and the applicable disclosure requirements of the Listing Rules[101] Principal Accounting Policies The condensed consolidated financial statements are prepared on a historical cost basis, with accounting policies consistent with the 2024 annual consolidated financial statements, and amendments to HKFRS accounting standards applied in this interim period had no significant impact on financial position and performance - The condensed consolidated financial statements are prepared on a historical cost basis, with accounting policies consistent with the 2024 annual consolidated financial statements[102] - Amendments to Hong Kong Financial Reporting Standards accounting standards were first applied in this interim period but had no significant impact on financial position and performance[103] Revenue and Segment Information The Group's revenue primarily derives from commercial property operation services in China, provided through entrusted management, brand and management output, and master lease models, with total revenue of RMB 284,229 thousand for the six months ended June 30, 2025, and all business and non-current assets located in mainland China Revenue from Commercial Property Operation Services by Operation Model (For the six months ended June 30) | Operation Model | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Entrusted Management Services | 185,706 | 209,691 | | Brand and Management Output Services | 34,439 | 43,458 | | Master Lease Services | 64,084 | 60,631 | | Total | 284,229 | 313,780 | Analysis of Revenue from Customer Contracts (For the six months ended June 30) | Revenue Category | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Market positioning, design and construction consulting and tenant solicitation services | 20,985 | 29,180 | | Operation management services | 182,235 | 198,323 | | Value-added services | 52,884 | 57,616 | | Total | 256,104 | 285,119 | - The Group has a single operating segment, with all business and non-current assets located in mainland China[110][111] Other Income For the six months ended June 30, 2025, the Group's other income was RMB 15,585 thousand, primarily including bank interest income, government subsidies, and compensation and penalties received from tenants Composition of Other Income (For the six months ended June 30) | Income Source | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Bank interest income | 14,393 | 17,547 | | Government subsidies | 455 | 603 | | Compensation and penalties received from tenants | 737 | 595 | | Total | 15,585 | 18,745 | Net Impairment Losses Recognized Under Expected Credit Loss Model For the six months ended June 30, 2025, the Group recognized net impairment losses of RMB 707 thousand under the expected credit loss model, a decrease from RMB 1,295 thousand in the same period last year, mainly due to changes in estimates for future recovery of trade receivables Net Impairment Losses Recognized Under Expected Credit Loss Model (For the six months ended June 30) | Metric | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Net impairment losses on trade receivables | (707) | (1,295) | Income Tax Expense For the six months ended June 30, 2025, the Group's income tax expense was RMB 24,902 thousand, a 9.0% year-on-year decrease, primarily due to reduced profit before tax, with mainland China entities subject to a 25% corporate income tax rate, and one entity in Qianhai enjoying a 15% preferential tax rate Composition of Income Tax Expense (For the six months ended June 30) | Category | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Current tax | 29,268 | 38,532 | | Deferred tax | (4,366) | (11,158) | | Total | 24,902 | 27,374 | - Mainland China entities are subject to a 25% corporate income tax rate, while one entity in Qianhai Shenzhen-Hong Kong Modern Service Industry Cooperation Zone enjoys a 15% preferential tax rate[118] Profit for the Period For the six months ended June 30, 2025, the Group's profit for the period was RMB 86,053 thousand, with total employee costs of RMB 89,719 thousand, including RMB 981 thousand in equity-settled share-based payments, and total depreciation expense of RMB 23,382 thousand Composition of Profit for the Period (For the six months ended June 30) | Metric | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Total employee costs | 89,719 | 99,022 | | Depreciation of property and equipment | 300 | 585 | | Depreciation of investment properties | 23,082 | 23,102 | | Total rental income from investment properties | (28,125) | (28,661) | | Direct operating expenses from investment properties | 27,405 | 27,615 | - Employee costs included equity-settled share-based payments of RMB 981 thousand, an increase from RMB 402 thousand in the same period last year[119] Dividends The Board declared an interim dividend of HKD 5.0 cents per ordinary share for the six months ended June 30, 2025, totaling approximately HKD 50,726,000, following the payment of the 2024 final dividend of HKD 8.3 cents per ordinary share, totaling approximately RMB 77,108 thousand, on July 10, 2025 Dividends Recognized as Distributed (For the six months ended June 30) | Dividend Type | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | 2024 final dividend (HKD 8.3 cents per share) | 77,108 | - | | 2023 final dividend (HKD 13.0 cents per share) | - | 120,066 | - The Board declared an interim dividend of HKD 5.0 cents per ordinary share for the six months ended June 30, 2025, totaling approximately HKD 50,726,000[120] Earnings Per Share For the six months ended June 30, 2025, basic earnings per share attributable to owners of the Company were RMB 8.58 cents, lower than RMB 8.80 cents in the same period last year, calculated using a weighted average of 1,012,579 thousand ordinary shares Basic Earnings Per Share Calculation Data (For the six months ended June 30) | Metric | 2025 (RMB thousand/thousand shares) | 2024 (RMB thousand/thousand shares) | | :--- | :--- | :--- | | Profit for the period attributable to owners of the Company | 86,896 | 89,100 | | Weighted average number of ordinary shares | 1,012,579 | 1,012,635 | | Basic earnings per share (RMB cents) | 8.58 | 8.80 | - Diluted earnings per share are not presented as there are no outstanding potential ordinary shares[123] Investment Properties In this interim period, the Group incurred leasehold improvement expenses of RMB 26,169 thousand for right-of-use assets under the master lease service model, which were capitalized as part of the initial cost of investment properties - In this interim period, the Group incurred leasehold improvement expenses of RMB 26,169 thousand for right-of-use assets under the master lease service model[124] - These expenses have been capitalized as part of the initial cost of investment properties[124] Trade and Other Receivables As of June 30, 2025, the Group's total trade and other receivables amounted to RMB 72,868 thousand, with trade receivables primarily from customer contracts and operating leases, typically with a 10 to 30-day credit period, and overdue trade receivables of RMB 886 thousand not considered in default Trade and Other Receivables (As of June 30, 2025) | Category | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Trade receivables | 25,985 | 23,961 | | Other receivables | 46,883 | 45,604 | | Total | 72,868 | 69,565 | Ageing Analysis of Trade Receivables (Net of allowance for credit losses, as of June 30, 2025) | Ageing | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | 0 to 10 days | 15,597 | 15,129 | | 11 to 30 days | 391 | 453 | | 31 to 60 days | 2,946 | 207 | | 61 to 90 days | 374 | 367 | | Over 90 days | 1,262 | 2,390 | | Total | 20,570 | 18,546 | - As of June 30, 2025, trade receivables overdue by 90 days or more amounted to RMB 886 thousand, but were not considered in default after assessment[127] Trade and Other Payables As of June 30, 2025, the Group's total trade and other payables amounted to RMB 223,171 thousand, a decrease from RMB 286,286 thousand at the end of 2024, with trade payables typically having a 30 to 90-day credit period, and other payables primarily including amounts collected on behalf of tenants, deposits received, and leasehold improvement payables Trade and Other Payables (As of June 30, 2025) | Category | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Trade payables | 30,482 | 40,286 | | Other payables | 192,689 | 246,000 | | Total | 223,171 | 286,286 | Ageing Analysis of Trade Payables (As of June 30, 2025) | Ageing | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | 0 to 30 days | 30,479 | 40,283 | | Over 90 days | 3 | 3 | | Total | 30,482 | 40,286 | - Other payables primarily include amounts collected on behalf of tenants (RMB 56,231 thousand), deposits received (RMB 58,509 thousand), and leasehold improvement payables (RMB 57,666 thousand)[133] Share Capital The Company's authorized share capital is 2,000,000,000 ordinary shares of HKD 0.01 each, with 1,014,516,000 shares issued and fully paid as of June 30, 2025, amounting to RMB 8,487 thousand, following the repurchase and cancellation of 761,000 ordinary shares in January 2024 Share Capital Details (As of June 30, 2025) | Category | Number of Shares | Share Capital (HKD thousand) | Share Capital (RMB thousand) | | :--- | :--- | :--- | :--- | | Authorized share capital | 2,000,000,000 | 20,000 | 16,755 | | Issued and fully paid share capital (June 30, 2025) | 1,014,516,000 | 10,145 | 8,487 | | Issued and fully paid share capital (January 1, 2024) | 1,016,807,000 | 10,168 | 8,506 | | Ordinary shares repurchased and cancelled in January 2024 | (761,000) | (8) | (5) | Share Award Scheme This note details the Company's Share Option Scheme, Restricted Share Unit Scheme, and the Share Award Scheme adopted by controlling shareholder Mr. Huang Chulong, with no options or units granted under the first two schemes as of June 30, 2025, while the Share Award Scheme granted 54,800,000 shares, with 5,220,000 remaining unexercised, and the Group recognized expenses of RMB 981 thousand for it - The Share Option Scheme was adopted on December 21, 2020, to incentivize and reward eligible participants, but no share options had been granted as of June 30, 2025[138][141] - The Restricted Share Unit Scheme was adopted on November 4, 2021, to recognize and reward contributors; as of June 30, 2025, 1,937,000 shares had been cumulatively repurchased for the scheme, but no restricted share units had been granted[142][144] - The Share Award Scheme granted 54,800,000 award shares on April 17, 2023, with 5,220,000 remaining unexercised as of June 30, 2025[146][147] - The Group recognized expenses of RMB 981 thousand for the Share Award Scheme (2024: RMB 402 thousand)[150] Capital Commitments As of June 30, 2025, the Group's capital expenditure contracted but not provided for in the condensed consolidated financial statements for the purchase of property and equipment was RMB 32,178 thousand, a decrease from RMB 48,928 thousand at the end of 2024 Capital Expenditure (As of June 30, 2025) | Category | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Capital expenditure contracted but not provided for the purchase of property and equipment | 32,178 | 48,928 | Related Party Transactions The Group has significant related party transactions with fellow subsidiaries and joint ventures under the common control of the ultimate controlling shareholder, Mr. Huang Chulong, with revenue from related parties totaling RMB 69,679 thousand and expenses RMB 5,701 thousand for the six months ended June 30, 2025, and total key management personnel remuneration of RMB 4,854 thousand Amounts Due from Related Parties (As of June 30, 2025) | Nature of Related Party | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Fellow subsidiaries | 8,774 | 6,091 | Amounts Due to Related Parties (As of June 30, 2025) | Nature of Related Party | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Fellow subsidiaries | 907 | 5,591 | Related Party Transactions (For the six months ended June 30) | Transaction Category | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Revenue from related parties | 69,679 | 76,119 | | Expenses from related parties | 5,701 | 6,398 | | Revenue from joint ventures | 1,814 | 1,676 | Key Management Personnel Remuneration (For the six months ended June 30) | Remuneration Category | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Short-term benefits | 4,574 | 3,852 | | Equity-settled share-based payments | 121 | 63 | | Contributions to retirement benefit schemes | 159 | 109 | | Total | 4,854 | 4,024 |