Corporate Information Directors and Key Personnel This section lists the company's executive directors, independent non-executive directors, and company secretary, providing core members of the corporate governance structure - Executive directors include Yu Jianqiu, Kuang Weixin, Gao Qiang, and Zhu Yufen45 - Independent non-executive directors include Li Wei, Fang Guanghua, and Yu Renzhong46 - The company secretary is Zhang Yingkun56 Corporate Governance and Contact Details This section provides detailed information on the company's auditor, legal counsel, committee members, registered office, China head office, Hong Kong place of business, principal bankers, company website, and stock code - The auditor is ZHONGHUI ANDA CPA Limited89 - The Chairman of the Audit and Corporate Governance Committee is Yu Renzhong89 - The company's stock code is 163610 - The company website is **http://www.cmru.com.cn**[10](index=10&type=chunk) Financial Highlights Key Financial Performance Indicators For the six months ended June 30, 2025, the company's turnover decreased by 25% year-on-year, net loss narrowed, but cash and cash equivalents significantly decreased, with total equity remaining negative and expanding Financial Highlights for the Six Months Ended June 30 | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Turnover | 340,852 | 454,200 | -25.07% | | Net loss attributable to owners of the Company | (208,066) | (221,735) | -6.16% | | Loss per share | (0.46) | (0.49) | -6.12% | | Net loss margin | (61.0%) | (48.8%) | -25.00% | | Return on equity | N/A | N/A | - | Balance Sheet Summary as at Period End | Indicator | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Cash and cash equivalents | 880 | 3,613 | -75.64% | | Total assets | 1,067,511 | 1,083,120 | -1.44% | | Total liabilities | (5,429,378) | (5,244,623) | 3.52% | | Total equity | (4,361,867) | (4,161,503) | 4.81% | Operating Efficiency Indicators as at Period End | Indicator | June 30, 2025 | December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Inventory turnover days | 43 | 38 | increased by 5 days | | Receivables turnover days | 7 | 62 | decreased by 55 days | | Payables turnover days | 841 | 578 | increased by 263 days | | Current ratio | 0.1 | 0.1 | No change | | Quick ratio | 0.1 | 0.1 | No change | | Debt-to-equity ratio | (38)% | (40)% | improved by 2% | | Net debt-to-equity ratio | (38)% | (40)% | improved by 2% | Management Discussion and Analysis Business Review In the first half of 2025, China's copper market experienced volatile growth, with the company's turnover decreasing by 25% and net loss narrowing by 6.1%. To address difficulties, the company applied for bankruptcy reorganization for some operating subsidiaries to restructure debt and unlock asset potential. Recycled copper product sales reached RMB 339 million, but communication and power distribution cable businesses were suspended due to insufficient working capital and a weak real estate market - In the first half of 2025, China's copper prices fluctuated, with Shanghai Futures Exchange copper prices rising from approximately RMB 76,000/tonne to a peak of approximately RMB 82,600/tonne in May, then falling back to approximately RMB 80,000/tonne in June1620 Business Performance in H1 2025 | Indicator | H1 2025 (RMB millions) | H1 2024 (RMB millions) | Change (%) | | :--- | :--- | :--- | :--- | | Turnover | 341 | 454 | -25.00% | | Loss | 208 | 222 | -6.31% | - The company has proactively applied for bankruptcy reorganization of some operating subsidiaries to restructure and reduce debt, unlocking the intrinsic value and commercial potential of quality assets1820 - For the six months ended June 30, 2025, the Group sold 4,877 tonnes of recycled copper products, generating sales turnover of RMB 339 million2225 - Communication cable and power distribution cable businesses have not resumed operations due to a lack of working capital and unfavorable conditions in the real estate sector2225 Prospects China's copper market is undergoing an adjustment period in 2025, with short-term impacts from slowing housing completions, declining seasonal demand, and tighter solar energy regulations. Nevertheless, long-term demand is supported by investments in infrastructure, renewable energy, and electric vehicles. The Asia-Pacific copper market is projected to grow from USD 136.16 billion in 2025 to USD 213.8 billion by 2034, at a CAGR of 5.3%. The company's immediate priority is to complete the bankruptcy reorganization of its subsidiaries - China's copper market faces short-term headwinds, including reduced housing completions, declining seasonal demand for home appliances, and tighter regulations on solar installations2326 - Long-term demand is continuously driven by national strategic investments in infrastructure, renewable energy, and electric vehicle production2426 - The Asia-Pacific copper market is projected to expand from USD 136.16 billion in 2025 to USD 213.8 billion by 2034, with a CAGR of 5.3%2831 - The company's immediate priority is to successfully complete the bankruptcy reorganization of its subsidiaries as soon as possible, while remaining confident in its long-term business prospects3032 Debt Restructuring Progress Multiple company subsidiaries (Tongxin, Jincircular, Taiyue, Yinlian Xiangbei, Hubei Rongsheng, Baohe New Century, Jinxin) are undergoing bankruptcy reorganization or pre-reorganization procedures, aiming to restructure debt, unlock asset value, and ensure continued operations. Relevant applications have been approved by the courts, and creditors' meetings have been held - Five subsidiaries, including Tongxin, Jincircular, Taiyue, Yinlian Xiangbei, and Hubei Rongsheng, are undergoing debt restructuring to reduce debt, unlock asset value, and enhance turnover capacity3334214 - The bankruptcy reorganization applications for Tongxin and Jincircular were accepted by the Youxian Court on January 3, 2023, with the first creditors' meeting held on March 28, 20234244203 - Taiyue's voluntary bankruptcy reorganization application was submitted to the court on May 18, 2023, and accepted by the Youxian Court on May 24, 20233739206 - Yinlian Xiangbei's bankruptcy reorganization application was accepted by the Miluo City People's Court on July 21, 2023, dismissing the winding-up petition3840209 - Hubei Rongsheng's pre-reorganization application was approved by the Yunmeng County People's Court of Hubei Province on September 12, 20234143213 - The bankruptcy reorganization applications for Baohe New Century and Jinxin were accepted by the Youxian Court on March 31, 2025, and May 12, 2025, respectively4748216 Human Resources As of June 30, 2025, the Group had 248 employees, with staff costs of approximately RMB 11.4 million. The company offers competitive remuneration, emphasizes employee training and team building, and is committed to social responsibility by employing disabled individuals Number of Employees and Staff Costs | Indicator | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total employees | 248 employees | 250 employees | | Staff costs (for the six months ended June 30, 2025) | RMB 11.4 million | - | - The Group is committed to fostering a culture of learning and sharing within the organization, emphasizing individual employee training and development, as well as team building4951 - The Group is committed to social responsibility, employing disabled individuals and providing appropriate working environments and safeguards4951 Dividends The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025, consistent with the same period in 2024 - The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025 (2024: nil)5052 Financial Review This section provides a detailed review of the company's financial performance, including declining turnover, narrowing losses, capital structure, liquidity, and asset pledges. The company faces severe liquidity challenges, but receivables turnover days have significantly improved Revenue Analysis For the six months ended June 30, 2025, the company's turnover was RMB 341 million, a 25% decrease from the same period in 2024. Sales of recycled copper products decreased by 24%, primarily due to a 30% reduction in sales volume, partially offset by a 9% increase in average selling price Turnover Analysis (RMB thousands) | Category | H1 2025 | H1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Sales of recycled copper products | 339,422 | 445,883 | -24.09% | | Sales of power distribution cables | 543 | 177 | 206.78% | | Sales of communication cables | – | 42 | -100.00% | | Sales of waste materials | – | 5,011 | -100.00% | | Others | 887 | 3,087 | -71.24% | | Total | 340,852 | 454,200 | -25.07% | - Sales volume of recycled copper products decreased by 30% from 7,004 tonnes in H1 2024 to 4,877 tonnes in H1 20255961 - The average selling price of recycled copper products increased by 9% from RMB 63,658 per tonne in H1 2024 to RMB 69,596 per tonne in H1 20255961 Loss for the Period For the six months ended June 30, 2025, the company's loss was RMB 208 million, a reduction from RMB 222 million in the same period of 2024, primarily due to a significant decrease in bad debt provisions Loss for the Period Comparison (RMB millions) | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Loss | 208 | 222 | | Bad debt provisions | 2 | 20 | - The reduction in loss was primarily due to a decrease in bad debt provisions from RMB 20 million in H1 2024 to approximately RMB 2 million in H1 20256062 Capital Structure As of June 30, 2025, the Group's capital structure primarily comprised shareholders' equity, bank and other borrowings, and finance leases. Total interest-bearing borrowings slightly decreased to RMB 1.652 billion, all due within one year or repayable on demand Total Interest-Bearing Borrowings (RMB thousands) | Category | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Bills payable | 24,003 | 24,373 | | Interest-bearing bank and other borrowings | 1,627,777 | 1,642,001 | | Total interest-bearing borrowings | 1,651,780 | 1,666,374 | - All interest-bearing borrowings are due within one year and repayable on demand6465 - The effective interest rate for bills payable is 12–13%, and for interest-bearing bank and other borrowings, it is 3.85–9.92%65 Liquidity and Financial Resources As of June 30, 2025, the company's cash and cash equivalents significantly decreased by 75.64% to RMB 0.9 million. Inventory turnover days increased, receivables turnover days significantly improved, but payables turnover days deteriorated. The company has net liabilities of approximately RMB 4.362 billion and is discussing a potential share subscription with state-owned enterprise Kefa to repay entrusted loans Changes in Liquidity and Turnover Days | Indicator | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Cash and cash equivalents | 880 | 3,613 | -75.64% | | Inventories | 41,497 | 39,208 | 5.84% | | Trade and bills receivables | 13,624 | 13,254 | 2.79% | | Trade and bills payables | 790,503 | 789,288 | 0.15% | - Inventory turnover days increased from 38 days in 2024 to 43 days in H1 2025, primarily due to reduced copper product sales6872 - Net receivables turnover days decreased from 62 days in 2024 to 7 days in H1 2025, mainly due to accelerated collection from customers and improved operations6972 - Payables turnover days increased from 578 days in 2024 to 841 days in H1 2025, primarily due to delays in settling payables7073 - As of June 30, 2025, the Group's total interest-bearing borrowings slightly decreased by RMB 14 million to RMB 1.652 billion7173 - The company has net liabilities of approximately RMB 4.362 billion, resulting in negative debt-to-equity and net debt-to-equity ratios7980 - The company is in discussions with state-owned enterprise Kefa regarding a potential share subscription, with proceeds intended to repay entrusted loans of approximately RMB 300 million7576 Charge on Assets As of June 30, 2025, the Group had pledged assets including property, plant and equipment, right-of-use assets, inventories, and bank deposits, with a total net book value of RMB 335 million, as collateral for certain bank financing Net Book Value of Pledged Assets (RMB thousands) | Asset Category | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Property, plant and equipment | 196,841 | 205,093 | | Right-of-use assets | 79,769 | 74,857 | | Inventories | 26,583 | 26,583 | | Bank deposits | 32,139 | 32,262 | | Total | 335,332 | 338,795 | Risk Management This section outlines the company's main risks, including commodity price volatility and foreign exchange risks. The company considers using copper futures to hedge commodity risk but currently has no open contracts. Foreign exchange risk primarily stems from HKD-denominated liabilities, resulting in an exchange difference of RMB 7.7 million in H1 2025 Commodity Risk The company's primary raw material is scrap copper, exposing it to price fluctuations in raw materials and finished products. The company considers using copper futures contracts to hedge some of this risk, but as of June 30, 2025, it had no open contracts - The company's main raw material for producing recycled copper products is scrap copper, which is subject to price fluctuations in both raw materials and finished products8487 - The company will consider using copper futures contracts to mitigate some of the risks associated with copper price fluctuations8487 - As of June 30, 2025, the Group had no open copper futures contracts8487 Foreign Currency Risk The functional currency for most of the Group's entities is RMB, but it is primarily exposed to currency risk involving HKD-denominated cash, convertible bonds, and contingent consideration liabilities. As of June 30, 2025, certain borrowings were denominated in HKD, totaling approximately HKD 376.2 million, resulting in an exchange difference of RMB 7.7 million during the period - The Group is primarily exposed to currency risk involving HKD-denominated cash and cash equivalents, convertible bonds, and contingent consideration liabilities8588 - As of June 30, 2025, certain interest-bearing bank and other borrowings were denominated in HKD, with a total principal amount of approximately HKD 376.2 million8688 - For the six months ended June 30, 2025, the company recognized an exchange difference of approximately RMB 7.7 million from the translation of financial statements of entities outside China8688 - During the period, the Group did not commit to entering into any financial instruments to hedge its foreign exchange risk8688 Other Operational Information This section covers information on the company's significant investments, acquisitions and disposals, capital expenditures, capital commitments, contingent liabilities, and post-reporting period events. The company had no significant changes or activities in these areas but faces multiple legal proceedings resulting in frozen bank accounts and seized assets - For the six months ended June 30, 2025, the Group held no significant investments in equity interests of any other companies (other than subsidiaries and associates)89[95](index=95&type=chunk] - During the period, the Group had no significant acquisitions or disposals of subsidiaries or associates, nor any significant capital expenditures909196[97](index=97&type=chunk] - As of June 30, 2025, capital commitments contracted but not provided for in the consolidated financial statements amounted to RMB 25.8 million, primarily for property, plant and equipment and land use rights92[98](index=98&type=chunk] - Multiple legal proceedings related to bank and other borrowings, as well as trade and other payables, are ongoing against the Group, resulting in the freezing of certain bank accounts and the seizure of certain properties, right-of-use assets, and inventories93[99](index=99&type=chunk] - No significant events requiring adjustment or disclosure affecting the Group occurred after the end of the financial period ended June 30, 202594[100](index=100&type=chunk] Other Information Directors' and Chief Executives' Interests in Shares As of June 30, 2025, the company's directors and chief executives held long and short positions in the company's shares and related shares. Mr. Yu Jianqiu held a significant number of shares through controlled corporations and incurred short positions due to pledged shares Directors' Interests in Shares and Related Shares of the Company | Name of Director | Capacity/Nature of Interest | Number of Shares Held (L) | Number of Related Shares (L) | Number of Related Shares (S) | Approximate Percentage of Interest | | :--- | :--- | :--- | :--- | :--- | :--- | | Mr. Yu Jianqiu | Beneficial owner | 620,400 | – | – | 0.14% | | | Interest in controlled corporation | 32,768,240 | – | 20,000,000 | 7.31% (L), 4.46% (S) | | Mr. Kuang Weixin | Beneficial owner | 327,260 | 400,000 | – | 0.16% | | Ms. Zhu Yufen | Beneficial owner | – | 300,000 | – | 0.07% | - Mr. Yu Jianqiu's 20 million short position refers to shares pledged by Shijian Co., Ltd. to China Huarong International Holdings Limited106108 - The number of related shares for Mr. Kuang Weixin and Ms. Zhu Yufen originated from share options granted under the expired share option scheme104107108 Directors' Rights to Acquire Shares or Debentures For the six months ended June 30, 2025, no rights to acquire benefits by way of purchase of shares or debentures of the company were granted to any director or their family members, nor were any such rights exercised by them - For the six months ended June 30, 2025, no rights to acquire benefits by way of purchase of shares or debentures of the company were granted to any director or their respective spouses or children under 18, nor were any such rights exercised by them111112 Substantial Shareholders' Interests and Short Positions in the Company's Shares and Related Shares As of June 30, 2025, several substantial shareholders held 5% or more interests or short positions in the company's shares, including long positions held through controlled corporations and short positions arising from pledged shares Substantial Shareholders' Long and Short Positions in the Company's Ordinary Shares | Name | Capacity/Nature of Interest | Number of Shares Held (L) | Number of Related Shares (L) | Number of Shares Held (S) | Approximate Percentage of Interest | | :--- | :--- | :--- | :--- | :--- | :--- | | Kwek Steven Poh Song | Interest in controlled corporation | 28,031,290 | – | – | 6.25% | | Mianyang Youxian District State-owned Assets Supervision and Administration Office | Interest in controlled corporation | 71,799,456 | – | – | 16.02% | | China CITIC Financial Asset Management Co., Limited | Interest in controlled corporation | 9,048,529 | – | – | 2.02% | | | Person with security interest over shares | – | 70,000,000 | – | 15.62% | | Leung Lisa | Interest in controlled corporation | 55,762,726 | – | – | 12.44% | | Huang Weiping | Interest in controlled corporation | – | – | 31,031,700 | 6.92% | | Mianyang Yuancheng Integration Development Group Co., Ltd. | Beneficial interest | – | – | 50,000,000 | 11.16% | | Mianyang Science and Technology City Development Investment (Group) Co., Ltd. | Person with security interest over shares | – | 31,031,700 | – | 6.92% | | Chan Man Hoi | As receiver | – | 87,672,800 | – | 19.56% | | He Junyu | As receiver | – | 87,672,800 | – | 19.56% | - Mianyang Youxian District State-owned Assets Supervision and Administration Office holds shares through Mianyang Fule Investment Co., Ltd. and Mianyang Zantai Industrial Co., Ltd.119121122 - Mianyang Yuancheng Integration Development Group Co., Ltd.'s 50 million short position resulted from shares pledged to Huarong International125127132 - Huang Weiping's 31.0317 million short position resulted from shares pledged by his controlled company to Mianyang Science and Technology City Development Investment (Group) Co., Ltd.129130131132 Expired Share Option Scheme The company's share option scheme expired on January 28, 2024. As of June 30, 2025, 11.28 million share options remained unexercised, with 2.7 million lapsing during the period. The fair value of share options is estimated using a binomial model - The share option scheme became effective upon listing on February 21, 2014, and expired on January 28, 2024134136 Details of Share Option Movements (thousand share options) | Category | Held at January 1, 2025 | Granted during the period | Exercised during the period | Cancelled/Lapsed during the period | Number of share options at June 30, 2025 | | :--- | :--- | :--- | :--- | :--- | :--- | | Directors | 700 | 0 | 0 | 0 | 700 | | Employees (excluding directors) | 10,580 | 0 | 0 | 0 | 10,580 | | Service providers | 2,700 | 0 | 0 | (2,700) | 0 | | Total for all categories | 13,980 | 0 | 0 | (2,700) | 11,280 | - The adjustment to unexercised share options became effective on April 9, 2025, the effective date of the share consolidation139 - The fair value of the granted share options is estimated using a binomial model on the grant date141143 Purchase, Sale or Redemption of 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 - 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 securities146150 Corporate Governance The company largely complied with the Corporate Governance Code in H1 2025, with two deviations: no legal action insurance for directors and the Chairman also serving as CEO. Additionally, Mr. Yu Jianqiu had a non-compliance event due to a forced sale of shares during a blackout period - The company did not make appropriate insurance arrangements for legal actions against its directors, as service fee quotations exceeded the budget147151 - Chairman Mr. Yu Jianqiu also serves as the Chief Executive Officer, which the Board believes is in the best interest of the Group148151 - A forced sale during the blackout period constituted a non-compliance event, involving the sale of 5,112,000 shares by Shijian Co., Ltd., controlled by Mr. Yu Jianqiu152155158161 Compliance with the Required Standard of Securities Transactions by Directors of Listed Issuers All directors, except Mr. Yu Jianqiu, complied with the Model Code for Securities Transactions. Mr. Yu's non-compliance was due to a forced sale of shares during a blackout period, deemed an inadvertent breach under special circumstances. The company has taken steps to strengthen internal controls and will organize training for directors - All directors, except Mr. Yu Jianqiu, confirmed compliance with the Model Code for the six months ended June 30, 2025154158 - Mr. Yu Jianqiu's non-compliance event was due to a forced sale of 5,112,000 shares by Shijian Co., Ltd., which he controls, during a blackout period, and was accepted by the directors (excluding Mr. Yu) as an inadvertent breach under special circumstances155158161162163 - The company has taken measures to strengthen internal controls and will organize training for directors regarding the requirements of the Listing Rules164166 Changes in Directors' Information In accordance with Rule 13.51B(1) of the Listing Rules, there have been no changes in the company's directors' information since the publication of the 2024 annual report - There have been no changes in the company's directors' information since the publication of the 2024 annual report167170 Review of Interim Report The Group's interim report and unaudited consolidated financial statements for the six months ended June 30, 2025, have been reviewed by the company's Audit Committee - The Group's interim report and unaudited consolidated financial statements for the six months ended June 30, 2025, have been reviewed by the company's Audit Committee168171 Acknowledgement The Board takes this opportunity to thank all shareholders and business partners for their continuous strong support, and all employees of the Group for their efforts and contributions - The Board thanks all shareholders, business partners, and employees for their strong support and contributions169172 Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income For the six months ended June 30, 2025, the Group recorded a net loss of RMB 208 million, narrowing from RMB 222 million in the prior year. Turnover decreased, but gross loss and bad debt provisions significantly reduced, while foreign currency translation generated a positive exchange difference Summary of Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (RMB thousands) | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Turnover | 340,852 | 454,200 | | Cost of sales | (343,169) | (487,992) | | Gross loss | (2,317) | (33,792) | | Other income and gains, net | 2,879 | 33,708 | | Net impairment losses on trade receivables | (1,577) | (20,347) | | Finance costs | (162,514) | (151,992) | | Loss before tax | (208,066) | (221,660) | | Loss for the period attributable to owners of the Company | (208,066) | (221,735) | | Exchange differences on translation of foreign operations | 7,702 | (5,603) | | Total comprehensive loss for the period attributable to owners of the Company | (200,364) | (227,338) | | Basic loss per share (RMB) | (0.46) | (0.49) | Condensed Consolidated Statement of Financial Position As of June 30, 2025, the Group's total assets slightly decreased, but total liabilities continued to rise, leading to further deterioration in net current liabilities and total equity (net liabilities), indicating severe financial challenges for the company Summary of Condensed Consolidated Statement of Financial Position (RMB thousands) | Indicator | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total non-current assets | 535,181 | 549,506 | | Total current assets | 532,330 | 533,614 | | Total assets | 1,067,511 | 1,083,120 | | Total current liabilities | 5,429,378 | 5,244,623 | | Total liabilities | 5,429,378 | 5,244,623 | | Net current liabilities | (4,897,048) | (4,711,009) | | Total assets less current liabilities | (4,361,867) | (4,161,503) | | Total equity (net liabilities) | (4,361,867) | (4,161,503) | - As of June 30, 2025, cash and cash equivalents were RMB 0.88 million, a significant decrease from RMB 3.613 million as of December 31, 2024180 Condensed Consolidated Statement of Changes in Equity For the six months ended June 30, 2025, the Group's accumulated losses increased due to the loss for the period and the impact of lapsed share options, partially offset by exchange differences on translation of foreign operations, leading to a further expansion of total equity (net liabilities) Summary of Condensed Consolidated Statement of Changes in Equity (RMB thousands) | Item | January 1, 2025 (Audited) | Loss for the period | Exchange differences on translation of foreign operations | Lapsed share options | June 30, 2025 (Unaudited) | | :--- | :--- | :--- | :--- | :--- | :--- | | Share capital | 363,611 | – | – | – | 363,611 | | Share premium | 2,204,701 | – | – | – | 2,204,701 | | Exchange reserve | (55,808) | – | 7,702 | – | (48,106) | | Capital reserve | 132,055 | – | – | – | 132,055 | | Statutory reserve | 144,662 | – | – | – | 144,662 | | Share-based payment reserve | 22,849 | – | – | (8,290) | 14,559 | | Accumulated losses | (6,973,573) | (208,066) | – | 8,290 | (7,173,349) | | Total | (4,161,503) | (208,066) | 7,702 | – | (4,361,867) | Condensed Consolidated Statement of Cash Flows For the six months ended June 30, 2025, the Group's operating activities shifted from net cash inflow to net outflow, while investing and financing activities continued to be net cash outflows, resulting in a significant decrease in cash and cash equivalents at period-end Summary of Condensed Consolidated Statement of Cash Flows (RMB thousands) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Net cash (used in)/from operating activities | (2,178) | 7,813 | | Net cash used in investing activities | (147) | (125) | | Net cash used in financing activities | (421) | (4,346) | | Net (decrease)/increase in cash and cash equivalents | (2,746) | 3,342 | | Cash and cash equivalents at beginning of period | 3,613 | 18,327 | | Effect of foreign exchange rate changes, net | 13 | (37) | | Cash and cash equivalents at end of period | 880 | 21,632 | Notes to the Condensed Consolidated Financial Information General Information and Basis of Preparation This note provides basic company information, principal activities, and the basis of preparation for the interim financial report. The company primarily engages in the manufacturing, sales, and trading of copper, aluminum, and related products. The report is prepared in accordance with IAS 34 and details the significant going concern uncertainties faced by the company and its mitigation measures - The company was incorporated in the Cayman Islands on February 22, 2013, and listed on the Main Board of the Hong Kong Stock Exchange on February 21, 2014185186189 - The Group's principal activities are the manufacturing, sales, and trading of copper, aluminum, and related products186189 - This interim financial report has been prepared in accordance with the applicable disclosure provisions of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited, including compliance with International Accounting Standard 34 Interim Financial Reporting187190 Going Concern Basis The Group faces significant going concern uncertainties due to continuous losses, substantial net current liabilities and net liabilities, debt defaults, and multiple legal proceedings resulting in frozen bank accounts and seized assets. Management is actively implementing financial plans and measures, including debt restructuring, seeking refinancing, strengthening cost control, and resolving litigation to address these challenges - The Group recorded net losses of approximately RMB 208 million and RMB 222 million for the two consecutive periods ended June 30, 2025, and 2024, respectively199200 - As of June 30, 2025, the Group's net current liabilities were approximately RMB 4.897 billion, and net liabilities were approximately RMB 4.362 billion199200 - As of June 30, 2025, the Group failed to repay approximately RMB 1.628 billion in interest-bearing bank and other borrowings and approximately RMB 24 million in bills payable199200 - The Group faces multiple lawsuits, resulting in the freezing of several bank accounts and the seizure of property, plant and equipment, right-of-use assets, and inventories199200 - Management has implemented or is implementing several financial plans and measures, including debt restructuring, negotiating extensions with creditors, seeking new financing, cost control, and resolving litigation to unfreeze assets201219222 Changes in Accounting Policies and Disclosures The accounting policies adopted in preparing the condensed consolidated interim financial information are consistent with those applied in the Group's annual consolidated financial statements for the year ended December 31, 2024. The adoption of new and revised IFRS accounting standards had no significant impact on the Group's financial performance and position - The accounting policies adopted for the preparation of the interim financial report are the same as those used for the 2024 annual financial statements226229 - The adoption of new and revised International Financial Reporting Standards had no significant impact on the Group's financial performance and position227229 Segment Reporting The Group is organized into three reportable operating segments based on products and services: recycled copper products, power distribution cables, and communication cables. Segment results are assessed based on adjusted profit before tax. The recycled copper products segment is the primary revenue source, but its sales decreased in H1 2025 - The Group is organized into three reportable operating segments: recycled copper products, power distribution cables, and communication cables231 Sales to External Customers (RMB thousands) | Segment | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Recycled copper products | 340,309 | 453,981 | | Power distribution cables | 543 | 177 | | Communication cables | – | 42 | | Total | 340,852 | 454,200 | - In H1 2025, the recycled copper products segment recorded a loss of RMB 41.031 million237 - In H1 2025, Customer A contributed RMB 326 million to the recycled copper products segment's turnover, representing the vast majority of the Group's turnover246 Revenue The Group's revenue primarily derives from the manufacturing and sale of copper and related products in China, recognized at the point of goods transfer. For the six months ended June 30, 2025, total turnover was RMB 341 million, a 25.07% decrease from the prior year, mainly impacted by reduced sales of recycled copper products - Revenue from contracts with customers primarily originates from the production and sale of copper and related products in China, with revenue recognized at the point in time when goods are transferred249258 Breakdown of Revenue Categories (RMB thousands) | Category | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Sales of recycled copper products | 339,422 | 445,883 | | Sales of power distribution cables | 543 | 177 | | Sales of communication cables | – | 42 | | Sales of waste materials | – | 5,011 | | Others | 887 | 3,087 | | Total | 340,852 | 454,200 | Other Income and Gain, Net For the six months ended June 30, 2025, the Group's other income and gains, net, significantly decreased to RMB 2.879 million, primarily due to a substantial decline in VAT refunds and government grants. A gain on debt forgiveness of RMB 2.485 million was recognized during the period Other Income and Gains, Net (RMB thousands) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | VAT refunds | 399 | 12,989 | | Government grants | 19 | 20,300 | | Interest income | 4 | 20 | | Net exchange differences | – | (1) | | Loss on disposal of property, plant and equipment | – | (15) | | Gain on debt forgiveness | 2,485 | – | | Others | (28) | 415 | | Total | 2,879 | 33,708 | - The VAT refund rate decreased from 50% to 30%, leading to a significant reduction in refund amounts262 - Government grants are primarily provided by local governments for general operations, with no future related costs263264 Loss Before Tax For the six months ended June 30, 2025, the Group's loss before tax was RMB 208 million, narrowing from RMB 222 million in the prior year. This was primarily due to reduced cost of sales and depreciation of property, plant and equipment Components of Loss Before Tax (RMB thousands) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Cost of sales | 343,169 | 487,992 | | Staff costs | 11,437 | 10,862 | | Depreciation of property, plant and equipment | 10,996 | 16,624 | | Depreciation of right-of-use assets | 1,742 | 1,998 | - Cost of sales includes RMB 3.411 million (2024: RMB 5.62 million) related to staff costs, depreciation, and amortization267 Income Tax For the six months ended June 30, 2025, the Group had no income tax expense, compared to RMB 0.075 million in the prior year. Entities in the Cayman Islands and British Virgin Islands are exempt from income tax, while Chinese subsidiaries are subject to corporate income tax Income Tax Expense (RMB thousands) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Current tax – PRC corporate income tax | – | 75 | - The Group is not subject to any income tax in the Cayman Islands and the British Virgin Islands269 - The company's PRC subsidiaries are subject to PRC corporate income tax applicable to each subsidiary269 Loss Per Share For the six months ended June 30, 2025, the Group's basic and diluted loss per share was RMB (0.46), an improvement from RMB (0.49) in the prior year. Diluted loss per share was the same as basic loss per share due to the absence of potential dilutive ordinary shares Loss Per Share (RMB) | Category | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Basic | (0.46) | (0.49) | | Diluted | (0.46) | (0.49) | - Basic loss per share is calculated based on the loss attributable to equity holders of the company of RMB 208 million and the weighted average number of ordinary shares in issue of 448,155,726 after the share consolidation for the interim period269270 - As the company's outstanding share options had no potential dilutive ordinary shares, diluted loss per share was the same as basic loss per share271 Property, Plant and Equipment As of June 30, 2025, the Group's property, plant and equipment had a net book value of RMB 375 million, with RMB 197 million pledged. There were no significant acquisitions or disposals during the period Net Book Value of Property, Plant and Equipment (RMB thousands) | Indicator | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Property, plant and equipment | 374,901 | 387,299 | - As of June 30, 2025, property, plant and equipment with a net book value of RMB 197 million were pledged as collateral for certain bank financing granted to the Group276 - For the six months ended June 30, 2025, and 2024, there were no significant acquisitions or disposals of property, plant and equipment276 Inventories As of June 30, 2025, the Group's inventories amounted to RMB 41.5 million, of which RMB 26.58 million were pledged as collateral for bank financing Inventories (RMB thousands) | Indicator | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Inventories | 41,497 | 39,208 | - As of June 30, 2025, inventories of RMB 26.583 million were pledged as collateral for bank financing granted to the Group273275 Trade and Bills Receivables, Prepayments, Other Receivables and Other Assets As of June 30, 2025, net trade and bills receivables amounted to RMB 13.624 million, with the majority (RMB 11.62 million) overdue for more than 180 days. Total prepayments, other receivables, and other assets were RMB 436 million Ageing Analysis of Trade and Bills Receivables (RMB thousands) | Ageing | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Within 30 days | 2,004 | 3 | | 61 to 180 days | – | 407 | | Over 180 days | 11,620 | 12,844 | | Total (net of impairment losses) | 13,624 | 13,254 | Prepayments, Other Receivables and Other Assets (RMB thousands) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Government grant receivables | 211,797 | 211,698 | | Other deposits, prepayments and receivables | 224,553 | 225,390 | | Total | 436,350 | 437,088 | - Trade and bills receivables are normally due within 90 days from the invoice date281 Trade and Bills Payables, Other Payables and Accruals As of June 30, 2025, trade and bills payables amounted to RMB 791 million, with the vast majority (RMB 789 million) overdue for more than 180 days. Total other payables and accruals reached RMB 2.838 billion Ageing Analysis of Trade and Bills Payables (RMB thousands) | Ageing | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Within 30 days | 428 | 144 | | 31 to 60 days | 838 | 81 | | 61 to 180 days | 249 | 83 | | Over 180 days | 788,988 | 788,980 | | Total | 790,503 | 789,288 | Other Payables and Accruals (RMB thousands) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Contract liabilities | 370,462 | 370,486 | | Accrued expenses and other payables | 2,467,063 | 2,268,276 | | Total | 2,837,525 | 2,638,762 | Interest-Bearing Bank and Other Borrowings As of June 30, 2025, the Group's total interest-bearing bank and other borrowings amounted to RMB 1.628 billion, all due within one year or repayable on demand, and were in default. Multiple assets and equity interests were pledged as collateral Analysis of Interest-Bearing Bank and Other Borrowings (RMB thousands) | Category | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Bank loans – secured | 252,330 | 252,330 | | Bank loans – unsecured | 5,000 | 5,000 | | Other borrowings – secured | 108,160 | 108,160 | | Other borrowings – unsecured and unguaranteed | 449,190 | 463,414 | | Factoring loans – secured | 507,000 | 507,000 | | Entrusted loans – secured | 306,097 | 306,097 | | Total | 1,627,777 | 1,642,001 | - As of June 30, 2025, all interest-bearing bank and other borrowings were repayable within one year or on demand, and the Group had failed to repay these borrowings285287288 - Bank financing is secured by property, plant and equipment (RMB 197 million), right-of-use assets (RMB 79.77 million), inventories (RMB 26.58 million), and pledged deposits (RMB 32.14 million)289 - Some borrowings are secured by 31.0317 million ordinary shares of the company (representing 6.9% of the issued share capital) held by shareholder Mr. Huang Weiping290 - Some bank loans are guaranteed by property, plant and equipment of Sichuan Gushan Oil Chemical Co., Ltd., a private company controlled by Mr. Yu Jianqiu (RMB 12 million), and by property, plant and equipment of Mianyang Baohe Jiahao Waste Material Recycling Co., Ltd., a private company controlled by an associate of the Group (RMB 47 million)290 Capital, Reserves and Dividends This section explains the company's dividend policy, share capital movements (including the 10-for-1 share consolidation effective April 7, 2025), statutory reserve fund, share premium account, and the treatment of share-based payment reserve - No interim dividend was declared for the six months ended June 30, 2025293297 - Pursuant to an ordinary resolution passed on April 7, 2025, every 10 ordinary shares of HKD 0.1 each in the issued and unissued share capital of the company were consolidated into one consolidated ordinary share of HKD 1 each299302 - PRC subsidiaries are required to appropriate funds to a statutory reserve fund, which is not available for dividend distribution to shareholders300301 - Funds in the share premium account may be distributed to shareholders, provided the company is able to pay its debts as they fall due in the ordinary course of business303306 - The share-based payment reserve represents the fair value portion of unexercised share options granted to employees at the grant date304305 Equity-Settled Share-Based Transactions The company's share option scheme expired on January 28, 2024. As of June 30, 2025, after adjustment for the share consolidation, 11.28 million share options remained unexercised, with 2.7 million lapsing during the period - The company's share option scheme became effective upon listing on February 21, 2014, and expired on January 28, 2024307308 Number of Share Options and Weighted Average Exercise Price under Share Option Scheme | Item | For the six months ended June 30, 2025 (thousands) | Weighted average exercise price (HKD) | | :--- | :--- | :--- | | Outstanding at January 1 | 139,800 | 0.70 | | Share consolidation | (125,820) | – | | Lapsed during the period | (2,700) | 16.80 | | Outstanding at end of period | 11,280 | 4.65 | | Exercisable at end of period | 11,280 | 4.65 | Fair Value Measurement of Financial Instruments The carrying amounts of the Group's financial assets and liabilities approximate their respective fair values. The company manages its capital to ensure going concern and maximize shareholder returns. As of June 30, 2025, no financial instruments were categorized into three levels for fair value measurement inputs - The carrying amounts of the Group's financial assets and liabilities presented in the consolidated statement of financial position approximate their respective fair values316317 Categories of Financial Instruments (RMB thousands) | Category | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Financial assets measured at amortized cost | 122,161 | 119,926 | | Financial liabilities measured at amortized cost | 3,987,566 | 3,804,339 | - The Group manages its capital to ensure its ability to continue as a going concern while maximizing returns to stakeholders through the optimization of the debt and equity balance318322 - As of June 30, 2025, and December 31, 2024, no financial instruments were categorized into three levels for fair value measurement inputs326327 Commitments As of June 30, 2025, the Group's capital commitments contracted but not provided for amounted to RMB 25.787 million, primarily for property, plant and equipment and land use rights, consistent with December 31, 2024 Capital Commitments (RMB thousands) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Property, plant and equipment | 13,242 | 13,242 | | Land use rights | 12,545 | 12,545 | | Total | 25,787 | 25,787 | Material Related Party Transactions The Group engaged in several material related party transactions during the period, including payment of delivery costs to an associate's subsidiary and provision of bank loan collateral by companies controlled by directors and associates Other Related Party Transactions (RMB thousands) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Delivery costs received by Mianyang Jincircular Financial Warehousing Co., Ltd. | 1,331 | 515 | | Pledge provided by Gushan Oil (a private company controlled by Mr. Yu Jianqiu) | 12,000 | 12,000 | | Loans secured by property, plant and equipment of Mianyang Baohe Jiahao (a private company controlled by an associate of the Group) | 47,000 | 47,000 | - Delivery costs ranged from RMB 28 to RMB 680 per tonne339 Compensation of Key Management Personnel For the period ended June 30, 2025, the Group's total compensation for key management personnel was RMB 3.637 million, a decrease from RMB 7.131 million in the prior year Compensation of Key Management Personnel (RMB thousands) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Total compensation for key management personnel | 3,637 | 7,131 |
中国金属利用(01636) - 2025 - 中期财报