励时集团(01327) - 2025 - 中期财报

Management Discussion and Analysis Financial Review Revenue slightly decreased to RMB 21.4 million, but gross profit increased by 49.2% to RMB 8.8 million, with gross margin rising to 41.1%, and other income turned profitable Revenue Changes | Metric | Six Months Ended June 30, 2025 (RMB million) | Six Months Ended June 30, 2024 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 21.4 | 22.1 | -3.2% | - Revenue decrease was primarily due to intense industry competition leading to fewer sales orders, partially offset by increased exhibition income and higher average selling prices for the Group's branded watches[5] Cost of Sales Changes | Metric | Six Months Ended June 30, 2025 (RMB million) | Six Months Ended June 30, 2024 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Cost of Sales | 12.6 | 16.1 | -21.7% | - The decrease in cost of sales is consistent with the reduction in revenue from branded watch sales during the period[6] Gross Profit and Gross Margin Changes | Metric | Six Months Ended June 30, 2025 (RMB million) | Six Months Ended June 30, 2024 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Gross Profit | 8.8 | 5.9 | +49.2% | | Gross Margin | 41.1% | 26.9% | +14.2pp | - The increase in gross profit was primarily due to higher average selling prices for the Group's branded watches for the six months ended June 30, 2025[7] Other Income and Losses Changes | Metric | Six Months Ended June 30, 2025 (RMB million) | Six Months Ended June 30, 2024 (RMB million) | Change (RMB million) | | :--- | :--- | :--- | :--- | | Other Income and Losses | 1.2 (Income) | (5.7) (Loss) | +6.9 | - The turnaround from loss to profit was mainly due to the unrealized fair value changes of financial assets at fair value through profit or loss[8] Administrative Expenses Changes | Metric | Six Months Ended June 30, 2025 (RMB million) | Six Months Ended June 30, 2024 (RMB million) | Change (RMB million) | | :--- | :--- | :--- | :--- | | Administrative Expenses | 11.4 | 6.7 | +4.7 | - The increase in administrative expenses was primarily due to higher depreciation and staff costs[10] Loss Before Tax For the six months ended June 30, 2025, the company's loss before tax narrowed to approximately RMB 5.6 million from RMB 10.7 million in the prior year Loss Before Tax | Metric | Six Months Ended June 30, 2025 (RMB million) | Six Months Ended June 30, 2024 (RMB million) | Change (RMB million) | | :--- | :--- | :--- | :--- | | Loss Before Tax | (5.6) | (10.7) | +5.1 | - Loss before tax narrowed[13] Loss for the Period For the six months ended June 30, 2025, loss for the period decreased to approximately RMB 5.6 million from RMB 10.7 million, driven by increased gross profit, higher administrative expenses, and a turnaround in other income and losses Loss for the Period | Metric | Six Months Ended June 30, 2025 (RMB million) | Six Months Ended June 30, 2024 (RMB million) | Change (RMB million) | | :--- | :--- | :--- | :--- | | Loss for the Period | (5.6) | (10.7) | +5.1 | - The decrease was mainly due to the net effect of increased gross profit, higher administrative expenses, and the turnaround in other income and losses[14] Prospects and Future Outlook The Group plans to enhance watch and jewelry design capabilities by strengthening its design team and recruiting talent to navigate the challenging economic environment in 2025, focusing on luxury high-end markets and potential collaborations to meet growing demand from the middle class and female consumers - The Group aims to provide quality products by enhancing its core competitiveness through strengthening the design and artistic literacy of its design team and recruiting more talent to improve watch and jewelry design and development capabilities[15] - The Group will closely monitor market reactions and re-strategize its business and product portfolio to adapt to market demands, including but not limited to designing, producing, and selling luxury high-end watches and jewelry while maintaining competitiveness[15] - The Group believes that in the long term, luxury high-end watches and jewelry and accessories consumption has strong potential, given (i) the rise of the middle class, (ii) increasing disposable income, especially among Chinese women, and (iii) higher female labor force participation rates[15] - The Group will allocate more resources and effort to its design team, considering collaborations with renowned designers to offer fashionable and reasonably priced watches and jewelry suitable for professional wear[15] Financial Position As of June 30, 2025, the Group's cash and bank balances increased to RMB 2.4 million, with the current ratio significantly rising to 15.5 times and the debt-to-equity ratio decreasing to 52.0%, indicating improved liquidity and a more robust financial structure Cash and Bank Balances | Metric | June 30, 2025 (RMB million) | December 31, 2024 (RMB million) | Change (RMB million) | | :--- | :--- | :--- | :--- | | Cash and Bank Balances | 2.4 | 1.0 | +1.4 | - Most cash and bank balances are held in HKD[17] Current Ratio | Metric | June 30, 2025 | December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Current Ratio | 15.5 times | 5.7 times | +9.8 times | - The current ratio is defined as current assets divided by current liabilities[17] Debt-to-Equity Ratio | Metric | June 30, 2025 | December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Debt-to-Equity Ratio | 52.0% | 86.2% | -34.2pp | - The debt-to-equity ratio is defined as total interest-bearing borrowings divided by shareholders' equity[17] Debts and Asset Pledges As of June 30, 2025, the Group had no assets pledged to secure any loans - As of June 30, 2025, the Group had no assets pledged to secure any loans granted to the Group[18] Capital Commitments As of June 30, 2025, the Group had no significant capital commitments - As of June 30, 2025, the Group had no significant capital commitments (December 31, 2024: RMB zero)[20] Foreign Exchange Risk The Group primarily operates in China and is exposed to foreign exchange risk related to RMB and USD, with no hedging activities during the reporting period, but management will continue to monitor and implement hedging measures as appropriate - The Group primarily operates in China and is exposed to foreign exchange risk arising from various currencies, mainly related to RMB and USD[21] - For the six months ended June 30, 2025, the Group did not enter into any hedging arrangements; however, management will continue to closely monitor its foreign currency exposure and needs, and will make hedging arrangements when necessary[21] Capital Structure Details of changes in the company's share capital for the six months ended June 30, 2025, are presented in Note 12 to the condensed consolidated interim financial statements - Details of changes in the company's share capital for the six months ended June 30, 2025, are set out in Note 12 to the condensed consolidated interim financial statements[22] Contingent Liabilities As of June 30, 2025, and December 31, 2024, the Group had no significant contingent liabilities - The Group had no significant contingent liabilities as of June 30, 2025, and December 31, 2024[23] Dividend Payment The Board does not recommend the payment of any interim dividend for the six months ended June 30, 2025 - The Board does not recommend the payment of any interim dividend for the six months ended June 30, 2025 (2024: nil)[24] Significant Acquisitions or Disposals For the six months ended June 30, 2025, there were no significant acquisitions or disposals of subsidiaries and associates by the Group - For the six months ended June 30, 2025, there were no significant acquisitions or disposals of subsidiaries and associates[25] Significant Investments As of June 30, 2025, the Group held equity interests in Caixin Media Group Limited and Juntai Holdings Limited, along with other listed securities, totaling RMB 15.853 million in fair value, representing 22.7% of total assets, with an investment strategy focused on building a diversified and flexible portfolio for sustainable long-term returns Significant Investment Overview | Investee Company Name | Fair Value Gain/(Loss) (RMB thousand) | Fair Value as of June 30, 2025 (RMB thousand) | Percentage of Group's Total Audited Assets as of June 30, 2025 (%) | | :--- | :--- | :--- | :--- | | Caixin Media Group Limited | 2,278 | 4,437 | 6.4% | | Juntai Holdings Limited | 4,076 | 7,337 | 10.5% | | Other Listed Securities | (5,204) | 4,079 | 5.8% | | Total | 1,150 | 15,853 | 22.7% | - The Group's investment strategy aims to build a diversified and flexible investment portfolio to maximize sustainable long-term returns and strive for high growth[26][27] - Caixin Media Group Limited is primarily engaged in providing advertising agency services and distributing books and magazines in China, as well as securities brokerage, money lending, and e-commerce platform services and sales of high-tech products in Hong Kong; the Group holds a 1.58% equity interest and received no dividends[27] - Juntai Holdings Limited is primarily engaged in medical product sales, plastic injection molding product sales, loan services, and securities investment; the Group holds a 3.09% equity interest and received no dividends[27] Employees and Remuneration Policy As of June 30, 2025, the Group maintained 56 employees, with total staff costs increasing to RMB 4.7 million, and the company uses annual performance reviews to attract and retain talent - As of June 30, 2025, the Group employed a total of 56 employees (December 31, 2024: 56 employees)[29] Total Staff Costs | Metric | Six Months Ended June 30, 2025 (RMB million) | Six Months Ended June 30, 2024 (RMB million) | Change (RMB million) | | :--- | :--- | :--- | :--- | | Total Staff Costs | 4.7 | 3.5 | +1.2 | - Employee performance is assessed annually, and the results are used to determine annual salaries and promotion reviews to attract and retain valuable employees[29] Purchase, Sale or Redemption of Listed Securities For the six months ended June 30, 2025, neither the company nor any of its subsidiaries purchased, redeemed, or sold any of the company's listed securities - For the six months ended June 30, 2025, neither the company nor any of its subsidiaries purchased, redeemed, or sold any of the company's listed securities[30] Directors' and Chief Executive's Interests in Shares, Underlying Shares and Debentures As of June 30, 2025, no directors or chief executives of the company had any disclosable interests or short positions in the shares, underlying shares, or debentures of the company or any associated corporation - As of June 30, 2025, no directors or chief executives of the company had any interests or short positions in the shares, underlying shares, or debentures of the company or any associated corporation that were required to be recorded in the register kept by the company under Section 352 of the Securities and Futures Ordinance, or otherwise notified to the company and the Stock Exchange under the Model Code[31][33] Substantial Shareholders' Interests in Shares and Underlying Shares As of June 30, 2025, apart from the company's directors and chief executives, no other persons held any disclosable interests or short positions in the shares or underlying shares - To the best knowledge of the company's directors and chief executives, as of June 30, 2025, no other persons (other than the company's directors and chief executives) held or were deemed to hold any interests or short positions in the shares or underlying shares that were required to be disclosed to the company and the Stock Exchange under Divisions 2 and 3 of Part XV of the Securities and Futures Ordinance[34] Directors' Rights to Acquire Shares or Debentures For the six months ended June 30, 2025, neither the company nor any of its subsidiaries was involved in any arrangements enabling directors or their associates to acquire benefits by purchasing shares or debt securities of the company or an associated corporation - Save as disclosed in the section "Directors' and Chief Executive's Interests and Short Positions in Shares, Underlying Shares and Debentures of the Company" above, neither the company nor any of its subsidiaries was involved in any arrangements at any time during the six months ended June 30, 2025, that would enable the company's directors or chief executives or their respective associates to acquire benefits by purchasing shares or debt securities of the company or any associated corporation[35] Directors' Interests in Competing Businesses For the six months ended June 30, 2025, the directors were unaware of any business or interest of any director or their associates that competed or might compete with the Group's business, or any other conflicts of interest - For the six months ended June 30, 2025, the directors were unaware of any business or interest of any director of the company and their respective associates (as defined in the Listing Rules) that competed or might compete with the Group's business, or any other conflicts of interest that such persons had or might have with the Group[36] Corporate Governance Code For the six months ended June 30, 2025, the Group adopted and complied with the code provisions set out in the Corporate Governance Code and Corporate Governance Report in Appendix 14 to the Listing Rules - For the six months ended June 30, 2025, the Group adopted and complied with the code provisions ("Code Provisions") set out in the Corporate Governance Code and Corporate Governance Report in Appendix 14 to the Listing Rules[37] Standard of Dealings by Directors in Securities The company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix 10 to the Listing Rules, and all directors confirmed compliance during the reporting period - The company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers ("Model Code") as set out in Appendix 10 to the Listing Rules as its code of conduct for directors' securities transactions[38] - Following specific inquiries with all directors, all directors confirmed their compliance with the required standards set out in the Model Code for the six months ended June 30, 2025[38] Audit Committee The Audit Committee, comprising three independent non-executive directors, reviewed the company's accounting principles and practices, discussed audit, internal control, and financial reporting matters, and reviewed the Group's unaudited condensed consolidated financial statements for the six months ended June 30, 2025 - The company's Audit Committee, comprising three independent non-executive directors, reviewed the accounting principles and practices adopted by the company and discussed matters relating to audit, internal control, and financial reporting[39] - The Audit Committee reviewed the Group's unaudited condensed consolidated financial statements for the six months ended June 30, 2025[39] Board of Directors As of June 30, 2025, the Board of Directors comprised two executive directors and three independent non-executive directors - As of June 30, 2025, the Board of Directors comprised the following two executive directors and three independent non-executive directors: Executive Directors Mr. Liang Yanhuan, Mr. Yang Xi; Independent Non-executive Directors Mr. Yu Junmin, Ms. Duan Baili, Mr. Zhong Weili[41] Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income For the six months ended June 30, 2025, the Group's revenue slightly decreased to RMB 21.366 million, but gross profit significantly grew by 49.2% to RMB 8.789 million due to a substantial decrease in cost of sales, and other income and losses turned profitable, leading to a narrowed loss for the period of RMB 5.591 million, with basic and diluted loss per share significantly improving to RMB 3.5 cents from 9.6 cents in the prior year Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income Key Data | Metric | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 21,366 | 22,090 | -3.28% | | Cost of Sales | (12,577) | (16,144) | -22.10% | | Gross Profit | 8,789 | 5,946 | +47.81% | | Other Income and Losses | 1,150 | (5,733) | Turned profitable | | Selling and Distribution Expenses | (2,785) | (2,762) | +0.83% | | Administrative Expenses | (11,442) | (6,680) | +71.29% | | Finance Costs | (1,303) | (1,500) | -13.13% | | Loss Before Tax | (5,591) | (10,729) | -47.90% | | Loss for the Period | (5,591) | (10,729) | -47.90% | | Total Comprehensive Loss for the Period | (7,727) | (10,593) | -27.06% | | Basic and Diluted Loss Per Share (RMB cents) | (3.5) | (9.6) | -63.54% | Condensed Consolidated Statement of Financial Position As of June 30, 2025, the Group's total net assets increased to RMB 41.161 million from RMB 33.896 million at the end of 2024, with non-current assets decreasing and current assets slightly increasing, notably a significant rise in cash and bank balances, while current liabilities substantially decreased due to a reduction in bonds payable, leading to improved net current assets and overall financial health Condensed Consolidated Statement of Financial Position Key Data | Metric | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Assets | | | | | Non-current Assets | 9,198 | 13,877 | -33.72% | | Current Assets | 60,572 | 59,874 | +1.17% | | Liabilities | | | | | Current Liabilities | 3,898 | 10,569 | -63.10% | | Non-current Liabilities | 24,711 | 29,286 | -15.69% | | Equity | | | | | Net Assets | 41,161 | 33,896 | +21.43% | | Share Capital | 1,911 | 45,286 | -95.78% | | Reserves | 39,250 | (11,390) | Turned profitable | - Within current assets, inventories increased, trade receivables, deposits, prepayments, and other receivables decreased, financial assets at fair value through profit or loss increased, and cash and bank balances significantly increased[45] - Within current liabilities, lease liabilities slightly increased, accrued expenses and other payables significantly decreased, and bonds payable decreased from RMB 5.146 million to zero[45] - Within non-current liabilities, both lease liabilities and bonds payable decreased[45] Condensed Consolidated Statement of Changes in Equity For the six months ended June 30, 2025, total equity attributable to owners of the company increased from RMB 33.896 million as of January 1, 2025, to RMB 41.161 million, primarily due to the net effect of loss for the period, a decrease in foreign currency translation reserve, share capital reduction, and shares issued from rights issue Total Equity Changes | Metric | June 30, 2025 (RMB thousand) | January 1, 2025 (RMB thousand) | Change (RMB thousand) | | :--- | :--- | :--- | :--- | | Total Equity | 41,161 | 33,896 | +7,265 | - Key changes include loss for the period (-5,591 thousand), other comprehensive income for the period (foreign currency translation reserve, -2,136 thousand), share capital reduction (-44,381 thousand), and shares issued from rights issue (+14,992 thousand)[48] - Accumulated losses decreased from (499,472) thousand to (460,682) thousand, mainly impacted by the share capital reduction[48] Condensed Consolidated Statement of Cash Flows For the six months ended June 30, 2025, net cash used in operating activities increased to RMB 2.824 million, net cash from investing activities was zero, and net cash from financing activities was RMB 4.233 million, resulting in an increase in cash and cash equivalents to RMB 2.382 million at period-end Condensed Consolidated Statement of Cash Flows Key Data | Metric | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | Change (RMB thousand) | | :--- | :--- | :--- | :--- | | Net Cash Used in Operating Activities | (2,824) | (235) | -2,589 | | Net Cash Used in Investing Activities | – | – | – | | Net Cash From/(Used in) Financing Activities | 4,233 | (410) | +4,643 | | Net Increase/(Decrease) in Cash and Cash Equivalents | 1,409 | (645) | +2,054 | | Cash and Cash Equivalents at End of Period | 2,382 | 1,381 | +1,001 | Notes to the Condensed Consolidated Interim Financial Statements 1. Basis of Preparation The interim financial statements are prepared in accordance with HKAS 34 and Appendix 16 of the Listing Rules, with the company operating as an investment company primarily engaged in branded watch and jewelry, OEM watch manufacturing, sales, and exhibition assistance, using HKD as its functional currency and RMB as its presentation currency - The unaudited condensed consolidated interim financial statements for the six months ended June 30, 2025, have been prepared in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting" issued by the Hong Kong Institute of Certified Public Accountants and the applicable disclosure provisions of Appendix 16 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[55] - The company is an investment company; the Group is principally engaged in the manufacturing and sale of self-owned brand watches and jewelry (including but not limited to diamond watches, tourbillon watches, and luxury jewelry watches), OEM watches, and third-party watches, as well as assisting clients in organizing exhibitions[55] - The functional currency of the company is HKD; for the purpose of presenting these consolidated financial statements, the Group adopts RMB as its presentation currency[55] 2. Application of New and Revised HKFRS The condensed consolidated financial statements are prepared on a historical cost basis, except for certain financial instruments measured at fair value, and the first-time application of HKAS 21 (Amendment) "The Effects of Changes in Foreign Exchange Rates—Lack of Exchangeability" is not expected to have a significant impact on operating results or financial position - The condensed consolidated financial statements are prepared on a historical cost basis, except for certain financial instruments measured at fair value[56] - During the current interim period, the Group has first applied the amendment to Hong Kong Accounting Standard 21, "The Effects of Changes in Foreign Exchange Rates—Lack of Exchangeability," issued by the Hong Kong Institute of Certified Public Accountants[57] - Currently, the Group believes that the adoption of the above new and revised Hong Kong Financial Reporting Standards will not have a significant impact on the Group's operating results and financial position[57] 3. Operating Segments The Group operates two business segments: watch manufacturing, trading, and retail, and assisting clients in organizing exhibitions; however, due to a single management team overseeing the entire business, there are no separately reportable segments, with branded watch turnover decreasing while exhibition income increased, and revenue primarily originating from China (excluding Hong Kong) - The Group currently operates two business segments: watch manufacturing, trading, and retail business, and assisting clients in organizing exhibitions; the Group has no separately reportable segments[59] Major Product Turnover | Product | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Branded Watches | 16,655 | 19,080 | -12.71% | | Exhibition Income | 4,711 | 3,010 | +56.51% | | Total | 21,366 | 22,090 | -3.28% | Geographical Information | Region | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Hong Kong, China | 4,711 | 3,010 | | China (excluding Hong Kong) | 16,655 | 19,080 | | Total | 21,366 | 22,090 | - No major customer information is presented as no individual customer contributed more than 10% of the Group's total revenue for the six months ended June 30, 2025, and 2024[63] 4. Other Income and Losses For the six months ended June 30, 2025, other income and losses turned from a loss of RMB 5.733 million in the prior year to an income of RMB 1.150 million, primarily due to the reversal of unrealized fair value losses on financial assets at fair value through profit or loss Other Income and Losses | Metric | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | Change (RMB thousand) | | :--- | :--- | :--- | :--- | | Unrealized fair value loss on financial assets at fair value through profit or loss | 1,150 | (5,733) | +6,883 | 5. Finance Costs For the six months ended June 30, 2025, finance costs decreased to RMB 1.303 million from RMB 1.500 million in the prior year, mainly comprising interest generated from bonds payable and lease liabilities Finance Costs | Metric | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Interest generated from bonds payable and lease liabilities | 1,303 | 1,500 | -13.13% | 6. Taxation For the six months ended June 30, 2025, and 2024, Hong Kong profits tax and deferred tax were nil due to no assessable profits in Hong Kong, while Chinese subsidiaries are subject to a corporate income tax rate of 25% - For the six months ended June 30, 2025, and 2024, no Hong Kong profits tax was provided as there were no estimated assessable profits arising in or derived from Hong Kong[67][68] - In accordance with the PRC Enterprise Income Tax Law and its implementation regulations, the tax rate for PRC subsidiaries is 25% effective from January 1, 2008[69] 7. Loss for the Period For the six months ended June 30, 2025, the loss for the period was RMB 5.591 million, primarily after deducting employee expenses, advertising expenses, cost of inventories, and depreciation, with both employee and advertising expenses increasing Loss for the Period and Key Deductions | Metric | Six Months Ended June 30, 2025 (RMB thousand) | Six Months Ended June 30, 2024 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Loss for the Period | (5,591) | (10,729) | -47.90% | | Total Employee Expenses (including directors' emoluments) | 4,716 | 3,530 | +33.59% | | Advertising Expenses | 2,785 | 962 | +189.50% | | Cost of Inventories Recognized as Expense | 12,577 | 16,144 | -22.10% | | Depreciation | 4,291 | 3,870 | +10.88% | 8. Loss Per Share Attributable to Owners of the Company For the six months ended June 30, 2025, basic and diluted loss per share attributable to owners of the company significantly improved to RMB 3.5 cents from 9.6 cents in the prior year, mainly due to a reduction in loss for the period and an increase in the weighted average number of ordinary shares outstanding (affected by capital reorganization and rights issue) Basic and Diluted Loss Per Share | Metric | Six Months Ended June 30, 2025 (RMB cents) | Six Months Ended June 30, 2024 (RMB cents) | Change (%) | | :--- | :--- | :--- | :--- | | Basic and Diluted Loss Per Share | (3.5) | (9.6) | -63.54% | - The loss used for calculating basic and diluted loss per share is the loss for the period attributable to owners of the company (5,591 thousand)[73] Weighted Average Number of Ordinary Shares | Metric | Six Months Ended June 30, 2025 (thousand shares) | Six Months Ended June 30, 2024 (thousand shares) | Change (%) | | :--- | :--- | :--- | :--- | | Weighted Average Number of Ordinary Shares | 158,580 | 111,305 | +42.48% | - The increase in the weighted average number of ordinary shares is derived from the shares in issue as of January 1, 2025, and has accounted for the share consolidation under the capital reorganization effective March 14, 2025, and the impact of the rights issue completed on April 30, 2025[73] - As the exercise of share options had an anti-dilutive effect, the diluted loss per share for the six months ended June 30, 2025, and 2024, was the same as the basic loss per share, assuming no potential dilutive ordinary shares existed[78] 9. Interim Dividend The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025 - The Board does not recommend the payment of any interim dividend for the six months ended June 30, 2025 (2024: nil)[75] 10. Property, Plant and Equipment For the six months ended June 30, 2025, the Group did not acquire any property, plant, and equipment - For the six months ended June 30, 2025, the Group did not acquire any property, plant, and equipment (2024: nil)[76] 11. Trade Receivables As of June 30, 2025, net trade receivables decreased to RMB 11.682 million from RMB 13.986 million at the end of 2024, with a significant reduction in receivables over 180 days, indicating improved collection efficiency Net Trade Receivables | Metric | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Trade Receivables | 61,298 | 65,317 | -6.00% | | Less: Provision for Expected Credit Losses | (49,616) | (51,331) | -3.34% | | Net Amount | 11,682 | 13,986 | -16.50% | - The Group generally grants its trade customers a credit period of 0 to 180 days[77] Aging Analysis of Trade Receivables | Aging | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | Change (RMB thousand) | | :--- | :--- | :--- | :--- | | 0 to 30 days | 3,091 | 1,083 | +2,008 | | 31 to 60 days | 3,026 | 735 | +2,291 | | 61 to 90 days | – | 553 | -553 | | 91 to 180 days | 1,838 | 498 | +1,340 | | Over 180 days | 3,727 | 11,117 | -7,390 | | Total | 11,682 | 13,986 | -2,304 | 12. Share Capital As of June 30, 2025, issued and fully paid share capital significantly decreased to RMB 1.911 million from RMB 45.286 million as of January 1, 2025, primarily due to a capital reorganization completed on March 14, 2025, including share consolidation, capital reduction, and share subdivision, as well as a rights issue completed on April 30, 2025 Issued and Fully Paid Share Capital | Metric | June 30, 2025 (RMB thousand) | January 1, 2025 (RMB thousand) | Change (RMB thousand) | | :--- | :--- | :--- | :--- | | Issued and Fully Paid Share Capital | 1,911 | 45,286 | -43,375 | - On March 14, 2025, the company completed a capital reorganization involving share consolidation (every five (5) issued and unissued existing shares of HKD 0.10 each were consolidated into one (1) consolidated share of HKD 0.50 each), capital reduction (the par value of each issued consolidated share was reduced from HKD 0.50 to HKD 0.01, with the credit arising used to offset the company's accumulated losses as of the effective date of the capital reduction), and share subdivision (each authorized but unissued consolidated share of HKD 0.50 each was subdivided into fifty (50) authorized but unissued adjusted shares of HKD 0.01 each)[79][80][81][82] - On April 30, 2025, the company allotted and issued 107,827,200 ordinary shares of HKD 0.15 each by way of a rights issue, increasing the company's issued share capital to 215,654,400 shares[82] 13. Share Option Scheme The company has a share option scheme effective from December 19, 2014, for 10 years, with no share options granted during the six months ended June 30, 2025, and 6,065 thousand outstanding share options at period-end - The company has a share option scheme adopted on December 19, 2014; the share option scheme will be valid for 10 years from the adoption date[83] - For the six months ended June 30, 2025, no share options were granted under the share option scheme (2024: nil)[83] Details of Movements in Number of Share Options Under Share Option Scheme | Grant Date | Exercise Price | Exercise Period | Vesting Period | Outstanding as of January 1, 2025 (thousand options) | Granted During Period (thousand options) | Exercised During Period (thousand options) | Adjusted During Period (thousand options) | Outstanding as of June 30, 2025 (thousand options) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | April 11, 2019 | HKD 1.99 | April 11, 2019 to April 10, 2029 | None | 29,376 | – | – | (23,311) | 6,065 | 14. Events After the Reporting Period No significant events affecting the Group have occurred since the end of the reporting period - No significant events affecting the Group have occurred since the end of the reporting period[84]