绿城服务(02869) - 2025 - 中期财报

Corporate Information This section provides key corporate information including board members, committee compositions, company secretary changes, and main contact details. Board of Directors This section lists executive, non-executive, and independent non-executive directors, noting changes like Mr. Chen Hao and Mr. Liu Xingwei's resignations and Mr. Song Hailin's appointment. - Executive Director Mr. Yang Zhangfa serves as Chairman, and Ms. Jin Keli is an Executive Director[3][4] - Mr. Chen Hao and Mr. Liu Xingwei resigned as Executive Director and Non-executive Director on February 24, 2025[3][4] - Mr. Song Hailin was appointed as a Non-executive Director on February 24, 2025[3][4] Committees This section details the composition of the Audit, Remuneration, and Nomination Committees, with Mr. Pan Zhaoguo chairing the Audit and Remuneration Committees, and Mr. Huang Jiayi chairing the Nomination Committee; Ms. Jin Keli was appointed to the Nomination Committee on May 28, 2025. - Mr. Pan Zhaoguo chairs both the Audit Committee and the Remuneration Committee[3][5] - Mr. Huang Jiayi chairs the Nomination Committee, with Ms. Jin Keli appointed as a member on May 28, 2025[4][5] Company Secretary This section discloses changes in the company secretary role, with Ms. Ng Sau Wai resigning and Ms. Cui Jiaxin appointed as her successor on August 22, 2025. - Ms. Ng Sau Wai resigned as Company Secretary on August 22, 2025[4][5] - Ms. Cui Jiaxin was appointed as Company Secretary on August 22, 2025[4][5] Key Contact Information This section provides essential company information including authorized representatives, registered office, headquarters, Hong Kong principal place of business, share registrar, auditor, legal counsel, principal bankers, website, stock code, and listing date. - Authorized representatives are Mr. Yang Zhangfa and Ms. Jin Keli[6][8] - The company's auditor is KPMG[7][8] - The company's stock code is 2869, and it was listed on July 12, 2016[9] Definitions This section defines key terms and abbreviations used in the report, including currency units, company entities, geographical regions, and financial/operational metrics. - "The Period" refers to the six months ended June 30, 2025[13][14] - "China," for the purpose of this report and regional reference, excludes Hong Kong, Macau SAR, and Taiwan[11] Company Overview The Group is a leading happiness living service provider in China, offering diversified services across property management, community living, and consulting, covering the entire life cycle of individuals and real estate. - The Group is a leading happiness living service provider in China, offering three types of businesses: property services, community living services, and consulting services[15][16] - As of June 30, 2025, property services managed a contracted GFA of 536.3 million square meters, covering 197 cities across 31 provinces, municipalities, and autonomous regions nationwide[18] - Community living services leverage mobile internet and smart community portals to provide daily necessities and quality living products/services, expanding and accelerating the traffic space for living services[18] - Consulting services utilize brand and professional advantages to offer project planning, design management, construction management, marketing management consulting, and digital product/service solutions to real estate developers and local property management companies[19] Historical Financial and Operating Data Highlights This section summarizes the company's historical financial and operating performance, including consolidated results, revenue by service line, operating data, financial position, and consolidated cash flow. Consolidated Results For the six months ended June 30, 2025, revenue increased by 6.1% YoY to RMB 9,288.7 million, gross profit grew by 8.9% to RMB 1,808.1 million, and profit attributable to equity holders increased by 22.6% to RMB 612.8 million, with property services accounting for 71.4% of total revenue. Consolidated Results Summary for the Six Months Ended June 30 | Indicator | 2025 (RMB Thousand) | 2024 (RMB Thousand) | YoY Increase % | | :--- | :--- | :--- | :--- | | Revenue | 9,288,711 | 8,752,891 | 6.1% | | Gross Profit | 1,808,096 | 1,661,030 | 8.9% | | Profit for the Period | 628,828 | 514,419 | 22.2% | | Profit Attributable to Equity Holders | 612,848 | 499,882 | 22.6% | | Earnings Per Share (RMB) | 0.20 | 0.16 | 25.0% | | Gross Profit Margin | 19.5% | 19.0% | +0.5pp | | Net Profit Margin | 6.8% | 5.9% | +0.9pp | Revenue Contribution and Gross Profit Margin by Service Line | Service Line | 2025 Revenue Contribution | 2024 Revenue Contribution | 2025 Gross Profit Margin | 2024 Gross Profit Margin | | :--- | :--- | :--- | :--- | :--- | | Property Services | 71.4% | 68.8% | 15.3% | 14.9% | | Community Living Services | 14.6% | 16.5% | 26.6% | 23.4% | | Consulting Services | 14.0% | 14.7% | 33.1% | 32.9% | | Technology Services | - | 2.6% | - | 36.6% | - Technology services have been reclassified under management consulting services within the consulting services segment in 2025[24][25] Revenue by Service Line Property services revenue grew by 10.2% YoY, driving overall growth, while community living services revenue decreased by 6.0%, primarily due to a 53.8% drop in home living services revenue, and consulting services revenue slightly increased by 0.6%. Revenue by Service Line for the Six Months Ended June 30 | Service Line | 2025 (RMB Thousand) | 2024 (RMB Thousand) | YoY Increase/Decrease % | | :--- | :--- | :--- | :--- | | Property Services | 6,632,856 | 6,018,592 | 10.2% | | Community Living Services | 1,356,749 | 1,442,815 | -6.0% | | - Community Products and Services | 676,200 | 643,416 | 5.1% | | - Home Living Services | 123,041 | 266,558 | -53.8% | | - Community Space Services | 173,015 | 153,067 | 13.0% | | - Property Asset Management Services | 333,472 | 329,044 | 1.3% | | - Cultural Education Services | 51,021 | 50,730 | 0.6% | | Consulting Services | 1,299,106 | 1,291,484 | 0.6% | | - In-progress Property Services | 1,011,618 | 996,531 | 1.5% | | - Management Consulting Services | 287,488 | 294,953 | -2.5% | | Technology Services | - | - | - | | Total Revenue | 9,288,711 | 8,752,891 | 6.1% | Operating Data As of June 30, 2025, GFA under management steadily increased by 11.3% to 536.3 million square meters, but GFA under reserve decreased by 2.9% YoY, while average property fees remained stable. Operating Data Summary for the Six Months Ended June 30 | Indicator | 2025 | 2024 | YoY Increase/Decrease % | | :--- | :--- | :--- | :--- | | Number of Property Service Contracts | 3,639 | 3,356 | 8.4% | | GFA Under Management (Million sq.m.) | 536.3 | 481.7 | 11.3% | | GFA Under Reserve (Million sq.m.) | 347.3 | 357.8 | -2.9% | | GFA Withdrawn (Million sq.m.) | 17.3 | 16.4 | 5.6% | | Average Property Fee (RMB/month/sq.m.) | 3.21 | 3.20 | 0.3% | - The decrease in GFA under reserve is mainly due to the domestic real estate development market environment, with the company prudently expanding in the incremental market and actively withdrawing from some non-core cities and projects with delivery risks[29] Financial Position As of June 30, 2025, total assets slightly decreased, total liabilities reduced, and net assets increased, with improved current and quick ratios, maintained net cash position, increased net cash per share, and enhanced net equity and total asset returns. Financial Position Summary as of June 30 | Indicator | 2025 (RMB Thousand) | 2024 (RMB Thousand) | Change % | | :--- | :--- | :--- | :--- | | Current Assets | 13,561,678 | 12,369,072 | 9.6% | | - Cash and Cash Equivalents | 4,047,465 | 3,026,475 | 33.8% | | - Trade and Other Receivables | 7,030,064 | 6,280,086 | 11.9% | | Non-current Assets | 4,804,098 | 6,178,946 | -22.3% | | Total Assets | 18,365,776 | 18,548,018 | -1.0% | | Current Liabilities | 9,359,497 | 9,074,383 | 3.1% | | Non-current Liabilities | 549,610 | 1,244,488 | -55.8% | | Total Liabilities | 9,909,107 | 10,318,871 | -4.0% | | Net Assets | 8,456,669 | 8,229,147 | 2.8% | | Current Ratio | 1.45x | 1.36x | +0.09x | | Quick Ratio | 1.39x | 1.27x | +0.12x | | Net Debt-to-Equity Ratio | Net Cash | Net Cash | Maintained Net Cash | | Net Cash Per Share | 1.07 | 0.97 | 10.3% | | Return on Net Equity | 7.2% | 6.4% | +0.8pp | | Return on Total Assets | 3.3% | 2.8% | +0.5pp | Consolidated Cash Flow For the six months ended June 30, 2025, net cash outflow from operating activities increased, net cash outflow from investing activities significantly decreased, and net cash outflow from financing activities slightly reduced, resulting in a decrease in cash and cash equivalents at period-end compared to the beginning of the period. Consolidated Cash Flow Summary for the Six Months Ended June 30 | Indicator | 2025 (RMB Thousand) | 2024 (RMB Thousand) | Change % | | :--- | :--- | :--- | :--- | | Net Cash From/(Used In) Operating Activities | (398,516) | (360,397) | -10.6% | | Net Cash From/(Used In) Investing Activities | (223,371) | (969,646) | 77.0% | | Net Cash Used In Financing Activities | (177,634) | (183,971) | 3.4% | | Net Decrease in Cash and Cash Equivalents | (799,521) | (1,514,014) | 47.2% | | Cash and Cash Equivalents at Period-End | 4,047,465 | 3,026,475 | 33.8% | Chairman's Statement The Chairman's statement highlights the company's adherence to "Integrity and Righteousness" and "Quality as Foundation, Innovation for Good, Diligence and Professionalism" values, achieving steady and high-quality performance growth, outlining strategic focus, development drivers, and talent potential, and looking forward to the second half of the year. - The company adheres to its original aspiration of "Services Make Life Better," precisely breaking down strategies into quantifiable, implementable, and improvable execution paths for each business line[34][38] - Property services market expansion focuses on core cities in the Yangtze River Delta, achieving dual upgrades in residential and commercial service spaces, and exporting "Greentown Standards" to the industry[36][38] - Community commercial innovation with a "neighborhood ecosystem" model, community products and services revenue with stable YoY growth, and core product demand reach with YoY improvement[39][45] - Elderly care/education businesses align with national policy, with home-based elderly care service stations increasing by over 40% YoY, and domestic cultural education service centers achieving profitability for the first time[40][46] - First-half operating revenue reached RMB 9,288.7 million, a 6.1% YoY increase; profit attributable to equity holders reached RMB 612.8 million, a 22.6% YoY increase[50][54] - The company actively participates in ESG (Environmental, Social, and Governance) initiatives, promotes green and low-carbon development, and builds community welfare units through the "Happiness Village Foundation" while engaging in ecological protection activities[51][54] - In talent development, the company has cultivated 131 outstanding young managers, added over 8,000 certified professionals, and achieved a 97.8% certification rate for project managers[57][60] - In the second half, the company will continue to enhance service density in core regions, deepen urban services and "elderly and children" connections, promote service product iteration and upgrades, and strengthen risk control and compliance management[62][65] Management Discussion and Analysis This section provides a detailed discussion and analysis of the company's financial performance, balance sheet items, liquidity, capital structure, business segment performance, acquisitions, future prospects, and other management disclosures. Financial Review This section provides a detailed review of financial performance for the six months ended June 30, 2025, covering key metrics such as revenue, costs, gross profit, expenses, core operating profit, expected credit losses on financial instruments, other operating expenses, net finance income, share of profits from associates and joint ventures, profit before tax, income tax, and profit for the period. Revenue by Business Segment for the Six Months Ended June 30 | Business Segment | 2025 (RMB Thousand) | % of Total Revenue | 2024 (RMB Thousand) (Restated) | % of Total Revenue (Restated) | YoY % | | :--- | :--- | :--- | :--- | :--- | :--- | | Property Services | 6,632,856 | 71.4% | 6,018,592 | 68.8% | 10.2% | | Community Living Services | 1,356,749 | 14.6% | 1,442,815 | 16.5% | -6.0% | | Consulting Services | 1,299,106 | 14.0% | 1,291,484 | 14.7% | 0.6% | | Total | 9,288,711 | 100.0% | 8,752,891 | 100.0% | 6.1% | - Cost of sales increased by 5.5% YoY to RMB 7,480.6 million[77][78] - Gross profit increased by 8.9% YoY to RMB 1,808.1 million, with gross profit margin rising by 0.5 percentage points to 19.5%, mainly due to cost control and efficiency improvement measures[80][83] - Selling and marketing expenses decreased by 11.3% YoY to RMB 141.4 million, with selling expense ratio decreasing by 0.3 percentage points to 1.5%[81][84] - Administrative expenses decreased by 8.0% YoY to RMB 593.0 million, with administrative expense ratio decreasing by 1.0 percentage point to 6.4%, mainly due to organizational streamlining and administrative overhead control[82][85] Gross Profit Margin by Business Line for the Six Months Ended June 30 | Business Line | 2025 Gross Profit Margin | 2024 Gross Profit Margin | Change (Percentage Points) | | :--- | :--- | :--- | :--- | | Property Services | 15.3% | 14.9% | +0.4 | | Community Living Services | 26.6% | 23.4% | +3.2 | | Consulting Services | 33.1% | 32.9% | +0.2 | - Core operating profit increased by 25.3% YoY to RMB 1,073.8 million, mainly due to enhanced revenue quality management and efficiency improvement measures[87][91] - Expected credit losses on financial instruments increased by 34.2% YoY to RMB 194.5 million, primarily due to an increase in trade receivables balance[88][92] - Other operating expenses increased by 86.4% YoY to RMB 88.8 million, mainly due to increased impairment provisions for some long-term equity investments and other assets[89][93] - Net finance income decreased by 10.9% YoY to RMB 34.6 million[90][94][95] - Share of profit from associates increased by RMB 0.6 million to RMB 9.7 million, and share of profit from joint ventures increased by RMB 4.2 million to RMB 6.3 million[96][101] - Profit before tax increased by 22.7% YoY to RMB 855.8 million, mainly due to expanded operating scale and improved management efficiency[97][102] - Income tax increased by 23.8% YoY to RMB 226.9 million, with effective tax rate rising by 0.2 percentage points to 26.5%[98][103] - Profit for the period increased by 22.2% YoY to RMB 628.8 million, with net profit margin rising by 0.9 percentage points to 6.8%[99][100][104][105] Balance Sheet Items This section outlines changes in key balance sheet items as of June 30, 2025, including investment properties, property, plant and equipment, right-of-use assets, intangible assets, trade and other receivables, trade and other payables, and lease liabilities. - Net book value of investment properties, property, plant and equipment, and right-of-use assets increased by 1.0% to RMB 1,241.9 million[107][112] - Intangible assets decreased by 7.3% to RMB 353.2 million[108][113] - Trade and other receivables increased by 26.1% to RMB 7,030.1 million, mainly due to business scale growth[109][114] - Trade and other payables increased by 13.7% to RMB 5,651.3 million, mainly due to increased procurement scale and dividends payable[110][115] - Total lease liabilities decreased by 11.6% to RMB 630.5 million[111][116] Liquidity, Reserves and Capital Structure The company maintained a sound financial position during the period, with increased current assets, decreased cash and cash equivalents but increased time deposits, disclosed long-term and short-term bank loans, and a slight increase in the debt-to-asset ratio. - Current assets increased by 7.2% to RMB 13,561.7 million[117][121] - Cash and cash equivalents decreased by 16.6% to RMB 4,047.5 million, while time deposits increased by 25.3% to RMB 1,400.9 million[117][121] - Long-term borrowings were RMB 21.2 million, and short-term borrowings were RMB 33.6 million, primarily for daily operating needs[118][119][121] - The debt-to-asset ratio (total debt divided by total assets) was 54.0%, an increase of 2.3 percentage points from December 31, 2024[120][122] Business Segment Performance This section analyzes the performance of the three major business segments: property services, community living services, and consulting services, noting steady growth in property services revenue and gross profit with expanding GFA, a slight decrease in community living services revenue despite growth in certain sub-segments, and a marginal increase in consulting services revenue with growth in in-progress property services but a decline in management consulting services. Property Services Property services, the Group's largest revenue and gross profit contributor, saw revenue grow by 10.2% to RMB 6,632.9 million and gross profit by 13.3% to RMB 1,017.8 million, with GFA under management increasing by 11.3% to 536.3 million square meters, though GFA under reserve decreased by 2.9% due to market conditions. - Property services revenue reached RMB 6,632.9 million, a 10.2% YoY increase, accounting for 71.4% of total revenue[123][124] - Property services gross profit reached RMB 1,017.8 million, a 13.3% YoY increase, accounting for 56.3% of total gross profit[123][124] - GFA under management was 536.3 million square meters, a 11.3% YoY increase, with a net increase of 54.6 million square meters[124] - GFA under reserve was 347.3 million square meters, a 2.9% YoY decrease, mainly affected by the domestic real estate development market environment[128] - The number of managed projects reached 3,639, covering 197 cities across 31 provinces, municipalities, and autonomous regions nationwide[128] Property Services GFA Under Management and Revenue by Region as of June 30 | Region | % of GFA Under Management | % of Total Revenue | | :--- | :--- | :--- | | Hangzhou | 16.7% | 34.7% | | Ningbo | 7.0% | 6.0% | | Yangtze River Delta Region (Excluding Hangzhou, Ningbo) | 35.1% | 29.0% | | Bohai Rim Economic Circle Region | 15.6% | 12.3% | | Pearl River Delta Region | 9.2% | 7.5% | | Other | 16.4% | 10.5% | | Total | 100.0% | 100.0% | Community Living Services Community living services revenue decreased by 6.0% YoY to RMB 1,356.7 million, but gross profit increased by 6.8% to RMB 360.5 million, with growth in community products and services, community space services, and property asset management services, while home living services revenue significantly declined due to the reclassification of Zhejiang Greentown House Service System Co., Ltd. as a joint venture. - Community living services revenue was RMB 1,356.7 million, a 6.0% YoY decrease, accounting for 14.6% of total revenue[129][130] - Community living services gross profit reached RMB 360.5 million, a 6.8% YoY increase, accounting for 19.9% of total gross profit[129][133] Community Living Services Revenue Breakdown for the Six Months Ended June 30 | Service Type | 2025 Revenue (RMB Thousand) | % of Total | YoY % | 2024 Revenue (RMB Thousand) | | :--- | :--- | :--- | :--- | :--- | | Community Products and Services | 676,200 | 49.8% | 5.1% | 643,416 | | Home Living Services | 123,041 | 9.1% | -53.8% | 266,558 | | Community Space Services | 173,015 | 12.7% | 13.0% | 153,067 | | Property Asset Management Services | 333,472 | 24.6% | 1.3% | 329,044 | | Cultural Education Services | 51,021 | 3.8% | 0.6% | 50,730 | | Total | 1,356,749 | 100.0% | -6.0% | 1,442,815 | - Home living services revenue significantly decreased by 53.8%, mainly due to the reclassification of Zhejiang Greentown House Service System Co., Ltd. as a joint venture following management structure adjustments[130][138] - Community products and services rely on a "convenience + relationship" community retail system, optimizing product structure, focusing on popular items, and enhancing competitiveness and premium capabilities[136][137] - Cultural education services deepen a multi-brand strategy, building a matrix of "Greentown Wonderful Garden + Inclusive Childcare Park + Aomeng International Garden" three brands, and actively collaborating with the government to establish inclusive childcare centers[143][145] Consulting Services Consulting services revenue slightly increased by 0.6% YoY to RMB 1,299.1 million, with gross profit growing by 1.0% to RMB 429.8 million, driven by a 1.5% increase in in-progress property services revenue, while management consulting services revenue declined by 2.5% due to the real estate market environment. - Consulting services revenue was RMB 1,299.1 million, a 0.6% YoY increase, accounting for 14.0% of total revenue[146][147] - Consulting services gross profit reached RMB 429.8 million, a 1.0% YoY increase, accounting for 23.8% of total gross profit[146][149] Consulting Services Revenue Breakdown for the Six Months Ended June 30 | Service Type | 2025 Revenue (RMB Thousand) | % of Total | YoY % | 2024 Revenue (RMB Thousand) | | :--- | :--- | :--- | :--- | :--- | | In-progress Property Services | 1,011,618 | 77.9% | 1.5% | 996,531 | | Management Consulting Services | 287,488 | 22.1% | -2.5% | 294,953 | | Total | 1,299,106 | 100.0% | 0.6% | 1,291,484 | - In-progress property services revenue increased by 1.5%, mainly through expanding high-end projects in core cities and extending service areas[150][151] - Management consulting services revenue decreased by 2.5%, mainly affected by the domestic real estate development market environment, and the company will continue to implement its city-deepening strategy to enhance competitiveness[150][152] Acquisition and Future Prospects The company adheres to an acquisition and investment strategy that emphasizes overall prudence and synergy with existing businesses, focusing on core operations, strictly implementing investment principles, prioritizing asset-light and stable growth, and valuing high-quality development over rapid expansion. - The investment strategy focuses on core businesses, strengthening operational efficiency management of acquired companies, and accelerating loss-making projects' cessation or disposal[154][156] - Investment direction is guided by the Group's development strategy, emphasizing synergy with existing businesses[154][156] - The investment model is primarily asset-light and stable, focusing on quality expansion of businesses, with rational and prudent investment[154][156] - The company believes that high-quality development is more valuable than high-speed growth, and investments should support core businesses to maintain business scale and efficiency at the industry forefront[155][157] Other Management Disclosures This section covers the company's disclosures regarding material litigation, foreign exchange risk, employee and remuneration policies, interim dividends, contingent liabilities, financial policies, asset pledges, material investments, and post-balance sheet events. - As of the report date, there were no outstanding material legal proceedings or claims that would affect the Group's normal operations[158][163] - The Group primarily operates in China, with most transactions conducted in RMB, resulting in limited foreign exchange risk, and no financial instruments are used for hedging[159][164] - As of June 30, 2025, the Group had 49,110 employees, a 3.1% YoY increase; total employee costs were RMB 3,028.4 million, a 5.0% YoY increase, mainly due to new project deliveries and rising labor costs[162][165] - The Board resolved not to declare any interim dividend for the six months ended June 30, 2025[166][174] - As of June 30, 2025, the Group had no material contingent liabilities[167][175] - As of June 30, 2025, a non-wholly owned subsidiary of the Group had a bank loan of RMB 8.5 million for purchasing office buildings, with the purchased property pledged as collateral[169][177] - During the period, the Group had no material investments, significant acquisitions or disposals of subsidiaries, associates, and joint ventures, nor any future plans for material investments and capital assets[170][171][172][179][180][181] - No material events occurred after June 30, 2025, and up to the date of this report that could affect the Group[173][182] Investor Relationship The company is committed to maintaining high transparency and fostering effective interaction with shareholders, investors, fund managers, analysts, and the public through various channels to enhance shareholder value and stabilize stock price performance, actively participating in capital market activities and gaining market recognition. - The company aims to build long-term, interactive relationships by providing regular, timely, accurate, and complete corporate information, enabling shareholders and investors to understand the company's operations, value, and business development[183][185] - During the period, the company communicated with a total of 599 investors through phone calls or meetings[188][190] - The company participated in various promotional activities organized by multiple brokers and investment banks, including UBS, Industrial Securities, Zhongtai Securities, CITIC Securities, and Citi[191] - During the period, the company organized 11 on-site visits, inviting investors, fund managers, analysts, and media to visit its headquarters and managed communities[193][194][196] - The company holds two earnings announcements and press conferences annually and received 17 investment reports from brokers, with most ratings being "Buy" or "Outperform"[197][198][199][200] Corporate Governance and Other Information This section details the company's corporate governance practices, including compliance with the Corporate Governance Code and Model Code for Securities Transactions by Directors, discloses changes in directors and senior management, and share repurchase and cancellation activities, along with information on directors', chief executive's, and substantial shareholders' interests and short positions in shares, and share option schemes. Corporate Governance Practice The company is committed to maintaining high standards of corporate governance, has adopted the Corporate Governance Code set out in Appendix C1 of the Listing Rules, and complied with all applicable provisions for the six months ended June 30, 2025. - The company has adopted the Corporate Governance Code set out in Appendix C1 of the Listing Rules and complied with all applicable code provisions during the period[201][202][206] Model Code for Securities Transactions by Directors The company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix C3 of the Listing Rules, and all directors confirmed compliance for the six months ended June 30, 2025. - The company has adopted the Model Code for Securities Transactions by Directors as set out in Appendix C3 of the Listing Rules[203][207] - All directors confirmed compliance with the Model Code for the six months ended June 30, 2025[203][207] Changes in Directors' and Senior Management's Information Executive Director Ms. Jin Keli was appointed as a member of the Nomination Committee on May 28, 2025, and Independent Non-executive Director Mr. Pan Zhaoguo was appointed as an independent non-executive director of Konka Group Co., Ltd. on August 14, 2025. - Executive Director Ms. Jin Keli was appointed as a member of the Nomination Committee on May 28, 2025[204][208] - Independent Non-executive Director Mr. Pan Zhaoguo was appointed as an independent non-executive director of Konka Group Co., Ltd. on August 14, 2025[205][208] Change of Company Secretary and Process Agent Ms. Ng Sau Wai resigned as Company Secretary and Process Agent due to work reallocation on August 22, 2025, and Ms. Cui Jiaxin was appointed as her successor on the same day. - Ms. Ng Sau Wai resigned as Company Secretary and Process Agent on August 22, 2025[210][214] - Ms. Cui Jiaxin was appointed as Company Secretary and Process Agent on August 22, 2025[211][214] Purchase, Sale or Redemption of the Listed Securities of the Company For the six months ended June 30, 2025, the company repurchased and cancelled a total of 20,030,000 shares on the Stock Exchange for a total of HKD 64,954,223.11, with the Board believing that share repurchases enhance share value and serve the overall interests of shareholders. - For the six months ended June 30, 2025, the company repurchased 17,170,000 shares on the Stock Exchange for a total of HKD 64,954,223.11[212][215][217] - Together with 2,860,000 shares repurchased in 2024, a total of 20,030,000 shares were cancelled on May 8, 2025[212][215] - The Board believes that the trading price of the shares did not adequately reflect their intrinsic value and future business prospects, and share repurchases can enhance share value and improve shareholder returns[213][215] - As of June 30, 2025, the company did not hold any treasury shares[217][219] Directors' and Chief Executive's Interests and Short Positions in Shares, Underlying Shares and Debentures This section discloses the interests and short positions of directors and the chief executive in the company's shares, underlying shares, and debentures as of June 30, 2025, including controlled corporation interests, spouse interests, and beneficial interests. Directors' and Chief Executive's Interests in Shares as of June 30 | Name | Capacity/Nature of Interest | Number of Shares (Excluding Equity Derivatives) | Number of Underlying Shares Granted Under 2018 Share Option Scheme | Number of Underlying Shares Granted Under 2023 Share Option Scheme | Approximate % of Company's Issued Share Capital | Long/Short Position | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Mr. Shou Bainian | Interest of controlled corporation | 1,020,000,000 | – | – | 32.43 | Long Position | | Ms. Xia Yibo | Interest of controlled corporation | 1,020,000,000 | – | – | 32.43 | Long Position | | Ms. Xia Yibo | Spouse interest | 3,500,000 | – | – | 0.11 | Long Position | | Ms. Li Hairong | Interest of controlled corporation | 423,868,339 | – | – | 13.48 | Long Position | | Ms. Li Hairong | Spouse interest | 28,000,000 | – | – | 0.89 | Long Position | | Ms. Li Hairong | Beneficial interest | – | 800,000 | – | 0.03 | Long Position | | Mr. Yang Zhangfa | Beneficial interest | 60,000,000 | – | – | 1.91 | Long Position | | Mr. Yang Zhangfa | Beneficial interest | – | 3,520,000 | 4,500,000 | 0.25 | Long Position | | Ms. Jin Keli | Beneficial interest | 4,240,000 | – | – | 0.13 | Long Position | | Ms. Jin Keli | Beneficial interest | – | 4,060,000 | 3,000,000 | 0.22 | Long Position | - Mr. Shou Bainian, Ms. Xia Yibo, and Ms. Li Hairong indirectly hold a significant number of shares through controlled corporations[223][225][226] - Mr. Yang Zhangfa and Ms. Jin Keli hold beneficial shares and share options[226] Substantial Shareholders' Interests and Short Positions in Shares and Underlying Shares This section discloses the interests and short positions of substantial shareholders, other than directors and the chief executive, in the company's shares or underlying shares as of June 30, 2025, including Orchid Garden Investment, Mr. Song Weiping, Lilac International Investment, Mr. Ju Jianhua, Longfor Group Holdings Limited, and Yiheng Capital. Substantial Shareholders' Interests in Shares as of June 30 | Shareholder Name/Entity | Capacity/Nature of Interest | Number of Shares | Approximate % of Company's Issued Share Capital | Long/Short Position | | :--- | :--- | :--- | :--- | :--- | | Orchid Garden Investment | Beneficial interest | 1,020,000,000 | 32.43 | Long Position | | Osmanthus Garden Investment | Interest of controlled corporation | 1,020,000,000 | 32.43 | Long Position | | Delta House Limited | Beneficial interest | 3,500,000 | 0.11 | Long Position | | Mr. Song Weiping | Interest of controlled corporation | 1,023,500,000 | 32.54 | Long Position | | Lily International Investment | Interest of controlled corporation | 1,020,000,000 | 32.43 | Long Position | | Ms. Yao Wanjing | Spouse interest | 1,020,000,000 | 32.43 | Long Position | | ShenaLan International Investment | Interest of controlled corporation | 1,020,000,000 | 32.43 | Long Position | | Lilac International Investment | Beneficial interest | 423,868,339 | 13.48 | Long Position | | Mr. Ju Jianhua | Spouse interest | 424,668,339 | 13.50 | Long Position | | Mr. Ju Jianhua | Beneficial interest | 28,000,000 | 0.89 | Long Position | | Longfor Group Holdings Limited | Interest of controlled corporation | 294,674,363 | 9.37 | Long Position | | Yiheng Capital Partners, L.P. | Beneficial interest | 163,381,816 | 5.19 | Long Position | | Yiheng Capital, LLC | Interest of controlled corporation | 163,381,816 | 5.19 | Long Position | | Yiheng Capital Management, L.P. | Investment manager | 163,381,816 | 5.19 | Long Position | | Yiheng Capital Management, LLC | Interest of controlled corporation | 163,381,816 | 5.19 | Long Position | - Orchid Garden Investment, Osmanthus Garden Investment, Lily International Investment, and ShenaLan International Investment are considered parties acting in concert, collectively holding a significant number of shares[233][235][236] - Mr. Song Weiping holds shares through Osmanthus Garden Investment and Delta House Limited, and his spouse, Ms. Xia Yibo, is also deemed to have relevant interests[237] - Yiheng Capital and its affiliated entities hold 163,381,816 shares, representing approximately 5.19% of the issued shares[232][237] Share Option Schemes This section details the grant, exercise, lapse, and cancellation of the company's 2018 and 2023 share option schemes, including the number of options for directors and employees, exercise prices, vesting periods, and performance targets, with a total of 84,951,120 unexercised options under the 2023 scheme as of June 30, 2025. - The 2018 Share Option Scheme was terminated on June 16, 2023, and as of June 30, 2025, the total number of options available for grant under this scheme was zero[242][253] - The 2023 Share Option Scheme was adopted on June 16, 2023, to replace the 2018 scheme[248][254] - On June 10, 2025, the company granted a total of 19,227,680 share options to senior management and certain employees, with an exercise price of HKD 4.310 per share[250][254] - As of June 30, 2025, the total number of unexercised share options under the 2023 Share Option Scheme was 84,951,120[251][254] - The vesting period for share options is 3 years, and is subject to performance targets such as the Group's core operating profit growth rate and individual performance levels[264][265] Details of Share Option Movements for the Six Months Ended June 30 | Indicator | 2025 (Thousand Options) | 2024 (Thousand Options) | | :--- | :--- | :--- | | Unexercised at Beginning of Year | 208,399 | 151,697 | | Forfeited During the Period | (8,950) | (14,541) | | Granted During the Period | 19,228 | 71,243 | | Exercised During the Period | (1,644) | – | | Unexercised at End of Period | 217,033 | 208,399 | | Exercisable at End of Period | 121,220 | 110,278 | - The fair value of share options is estimated using a binomial model, with input variables including forfeiture rate, expected volatility, expected dividends, and risk-free interest rate[430][431][432] Directors' Rights to Acquire Shares or Debentures For the six months ended June 30, 2025, neither the company nor any of its subsidiaries entered into any arrangements enabling directors to acquire benefits by purchasing shares or debentures of the company or any other body corporate. - During the period, neither the company nor any of its subsidiaries entered into any arrangements enabling directors to acquire benefits by purchasing shares or debentures of the company or any other body corporate[267][270] Audit Committee The Audit Committee, comprising four independent non-executive directors with Mr. Pan Zhaoguo as chairman, is responsible for reviewing and overseeing the company's financial reporting process, risk management, and internal controls, and has reviewed the unaudited interim financial statements and interim results for the period. - The Audit Committee consists of four independent non-executive directors, with Mr. Pan Zhaoguo serving as Chairman[268][271] - Its primary responsibilities include reviewing and overseeing the company's financial reporting process, risk management, and internal controls[268][271] - The Committee has reviewed the Group's unaudited interim financial statements and interim results for the period[269][272] Review Report KPMG has reviewed the interim financial report for the six months ended June 30, 2025, in accordance with Hong Kong Standard on Review Engagements 2410, concluding that nothing has come to their attention to suggest the interim financial report is not prepared in all material respects in accordance with Hong Kong Accounting Standard 34. - KPMG has reviewed the interim financial report in accordance with Hong Kong Standard on Review Engagements 2410[276][278] - The review concluded that nothing has come to their attention to suggest the interim financial report is not prepared in all material respects in accordance with Hong Kong Accounting Standard 34[279][280] Consolidated Statement of Profit or Loss and Other Comprehensive Income For the six months ended June 30, 2025, revenue from continuing operations increased by 6.1% YoY to RMB 9,288.7 million, and profit for the period grew by 22.2% to RMB 628.8 million, with profit attributable to equity holders of RMB 612.8 million and basic earnings per share of RMB 0.195. Consolidated Statement of Profit or Loss and Other Comprehensive Income Summary for the Six Months Ended June 30 | Indicator | 2025 (RMB Thousand) | 2024 (RMB Thousand) (Restated) | | :--- | :--- | :--- | | Revenue | 9,288,711 | 8,752,891 | | Cost of Sales | (7,480,615) | (7,091,861) | | Gross Profit | 1,808,096 | 1,661,030 | | Operating Profit | 802,501 | 647,670 | | Profit Before Tax | 855,770 | 697,724 | | Income Tax | (226,942) | (183,305) | | Profit for the Period | 628,828 | 514,419 | | Profit Attributable to Equity Holders of the Company | 612,848 | 503,585 | | Basic Earnings Per Share (RMB) | 0.195 | 0.158 | | Diluted Earnings Per Share (RMB) | 0.195 | 0.158 | - In other comprehensive income, exchange differences arising from the translation of financial statements resulted in a net loss of RMB 86,570 thousand[283] - Data related to discontinued operations (primarily the business of Montessori Academy Group Holdings Pty Ltd) has been restated[282][285] Consolidated Statement of Financial Position As of June 30, 2025, total assets were RMB 18,365.8 million, a slight decrease from the end of 2024, with net current assets increasing, total liabilities decreasing, and net assets growing to RMB 8,456.7 million. Consolidated Statement of Financial Position Summary as of June 30, 2025 | Indicator | 2025 June 30 (RMB Thousand) | 2024 December 31 (RMB Thousand) | | :--- | :--- | :--- | | Non-current Assets | 4,804,098 | 5,044,528 | | Current Assets | 13,561,678 | 12,649,296 | | Total Assets | 18,365,776 | 17,693,824 | | Current Liabilities | 9,359,497 | 8,528,388 | | Non-current Liabilities | 549,610 | 622,379 | | Total Liabilities | 9,909,107 | 9,150,767 | | Net Assets | 8,456,669 | 8,543,057 | | Total Equity Attributable to Equity Holders of the Company | 7,706,262 | 7,788,687 | | Non-controlling Interests | 750,407 | 754,370 | | Total Equity | 8,456,669 | 8,543,057 | - Cash and cash equivalents were RMB 4,047.5 million, and trade and other receivables were RMB 7,030.1 million[287] - Trade and other payables were RMB 5,651.3 million, and contract liabilities were RMB 2,443.8 million[287] Consolidated Statement of Changes in Equity For the six months ended June 30, 2025, total equity attributable to equity holders was RMB 7,706.3 million, with profit for the period of RMB 612.8 million, but total equity slightly decreased due to factors such as exchange adjustments and share repurchases and cancellations. Consolidated Statement of Changes in Equity Summary for the Six Months Ended June 30 | Item | 2025 January 1 (RMB Thousand) | Changes During the Period (RMB Thousand) | 2025 June 30 (RMB Thousand) | | :--- | :--- | :--- | :--- | | Share Capital | 27 | – | 27 | | Share Premium | 2,577,453 | (60,022) | 1,951,045 | | Share Option Reserve | 178,258 | 18,829 | 195,999 | | Exchange Reserve | (129,096) | (86,570) | (215,666) | | Retained Profits | 5,289,445 | 612,848 | 5,902,293 | | Total Equity Attributable to Equity Holders of the Company | 7,788,687 | (82,425) | 7,706,262 | | Non-controlling Interests | 754,370 | (3,963) | 750,407 | | Total Equity | 8,543,057 | (86,388) | 8,456,669 | - Profit for the period was RMB 612.8 million, and net other comprehensive income was RMB (86,606) million[291] - Share repurchases and cancellations resulted in a decrease in share premium of RMB 60,022 thousand[291] Condensed Consolidated Cash Flow Statement For the six months ended June 30, 2025, net cash used in operating activities was RMB 398.5 million, net cash used in investing activities was RMB 223.4 million, and net cash used in financing activities was RMB 177.6 million, with cash and cash equivalents at period-end totaling RMB 4,047.5 million. Condensed Consolidated Cash Flow Statement Summary for the Six Months Ended June 30 | Activity Type | 2025 (RMB Thousand) | 2024 (RMB Thousand) | | :--- | :--- | :--- | | Net Cash Used In Operating Activities | (398,516) | (360,397) | | Net Cash Used In Investing Activities | (223,371) | (969,646) | | Net Cash Used In Financing Activities | (177,634) | (183,971) | | Net Decrease in Cash and Cash Equivalents | (799,521) | (1,514,014) | | Cash and Cash Equivalents at Period-End | 4,047,465 | 3,026,475 | - Cash outflow from investing activities significantly decreased, mainly due to reduced payments for the purchase of investment properties, property, plant and equipment, right-of-use assets, and intangible assets, as well as increased proceeds from the redemption of financial assets[294] - Cash outflow from financing activities slightly decreased, mainly due to reduced proceeds from new bank loans and other borrowings, but also a corresponding reduction in repayment of bank loans[295] Notes to the Unaudited Interim Financial Report This section provides detailed notes to the unaudited interim financial report, covering the basis of preparation, changes in accounting policies, revenue and segment reporting, other income and net losses, profit before taxation, income tax, earnings per share, investment properties, property, plant and equipment, goodwill, interests in associates and joint ventures, other financial assets, trade and other receivables, restricted bank balances, time deposits and cash and cash equivalents, bank loans, contract liabilities, trade and other payables, capital, reserves and dividends, fair value measurement of financial instruments, commitments, material related party transactions, and discontinued operations. Basis of Preparation This interim financial report is prepared in accordance with applicable disclosure provisions of the Listing Rules of The Stock Exchange of Hong Kong Limited and Hong Kong Accounting Standard 34 "Interim Financial Reporting" issued by the HKICPA, authorized for issue on August 22, 2025, and has been reviewed by KPMG. - The company was incorporated in the Cayman Islands on November 24, 2014, and its shares were listed on the Main Board of the Stock Exchange on July 12, 2016[297][301] - The interim financial report is prepared using the same accounting policies adopted in the 2024 annual financial statements, except for changes in accounting policies expected to be reflected in the 2025 annual financial statements[299][301] - This interim financial report is unaudited but has been reviewed by KPMG in accordance with Hong Kong Standard on Review Engagements 2410[303][306] Changes in Accounting Policies The Group applied amendments to HKAS 21 "The Effects of Changes in Foreign Exchange Rates: Lack of Exchangeability" during the period, but it had no material impact on this interim report as the Group did not engage in related transactions, and no new standards or interpretations not yet effective were applied. - The Group applied amendments to HKAS 21 "The Effects of Changes in Foreign Exchange Rates: Lack of Exchangeability," but it had no material impact on this interim report[304][307] - The Group did not apply any new standards or interpretations not yet effective during this accounting period[305][307] Revenue and Segment Reporting The Group's revenue primarily derives from three business segments: property services, community living services, and consulting services, with technology services reclassified to management consulting services within the consulting segment for clearer business representation, and the Group manages its business by geographical location, reporting seven reportable segments. Revenue by Major Service Line for the Six Months Ended June 30 | Service Line | 2025 (RMB Thousand) | 2024 (RMB Thousand) (Restated) | | :--- | :--- | :--- | | Property Services | 6,632,856 | 6,018,592 | | Community Living Services | 1,332,133 | 1,413,451 | | Consulting Services | 1,299,106 | 1,291,484 | | Gross Rental Income from Investment Properties (Community Living Services) | 24,616 | 29,364 | | Total | 9,288,711 | 8,752,891 | - Technology services have been reclassified to management consulting services within the consulting services segment, and relevant comparative data has been restated[313][317] - The Group manages its business by geographical location, divided into seven reportable segments: Hangzhou, Yangtze River Delta region, Pearl River Delta region, Bohai Rim Economic Circle region, Australia (discontinued operations), other overseas and Hong Kong regions, and other regions in mainland China[315][319][320][325] - Segment assets include all non-current and current assets (excluding deferred tax assets), and segment liabilities include trade and other payables and bank borrowings directly managed by the segment (excluding current and deferred tax liabilities)[321][323] Other Revenue and Other Net Loss For the six months ended June 30, 2025, other revenue primarily from government grants increased YoY, while other net losses were mainly affected by unrealized losses on convertible notes, fund losses, and increased impairment provisions for long-term equity investments. Other Revenue Summary for the Six Months Ended June 30 | Item | 2025 (RMB Thousand) | 2024 (RMB Thousand) (Restated) | | :--- | :--- | :--- | | Government Grants | 30,785 | 16,503 | | Other | 8,480 | 6,128 | | Total | 39,265 | 22,631 | Other Net Loss Summary for the Six Months Ended June 30 | Item | 2025 (RMB Thousand) | 2024 (RMB Thousand) (Restated) | | :--- | :--- | :--- | | Net Loss on Disposal of Property, Plant and Equipment | (3,498) | (445) | | Net Realized and Unrealized (Losses)/Gains on Financial Assets at Fair Value Through Profit or Loss | (43,299) | (26,125) | | Net Exchange Gains/(Losses) | 10,163 | (12,751) | | Total | (27,184) | (39,325) | - Unrealized losses of RMB 49,158 thousand were recorded on convertible notes, and fund losses of RMB 28,084 thousand were recorded[331] Profit Before Taxation from Continuing Operations This section details various factors affecting profit before taxation, including net finance income, staff costs, expected credit losses on financial instruments, impairment losses on goodwill and interests in associates, depreciation, amortization, and cost of inventories. Net Finance Income for the Six Months Ended June 30 | Item | 2025 (RMB Thousand) | 2024 (RMB Thousand) (Restated) | | :--- | :--- | :--- | | Interest Income from Financial Assets Measured at Amortized Cost | (50,024) | (55,086) | | Interest Expense on Bank Loans | 1,047 | 3,857 | | Interest Expense on Lease Liabilities | 14,347 | 12,365 | | Net Finance Income | (34,630) | (38,864) | Staff Costs for the Six Months Ended June 30 | Item | 2025 (RMB Thousand) | 2024 (RMB Thousand) (Restated) | | :--- | :--- | :--- | | Salaries and Other Benefits | 2,584,021 | 2,456,055 | | Equity-settled Share-based Payment Expenses | 18,829 | 10,641 | | Defined Contribution Plan Contributions | 425,597 | 418,558 | | Total | 3,028,447 | 2,885,254 | Other Items for the Six Months Ended June 30 | Item | 2025 (RMB Thousand) | 2024 (RMB Thousand) (Restated) | | :--- | :--- | :--- | | Expected Credit Losses on Financial Instruments | 194,512 | 144,978 | | Impairment Losses (Goodwill and Interests in Associates) | 52,071 | 31,723 | | Depreciation (Property, Plant and Equipment, Right-of-Use Assets, Investment Properties) | 162,779 | 169,138 | | Amortization of Intangible Assets | 31,639 | 25,709 | | Cost of Inventories | 410,860 | 367,528 | | Outsourced Staff Costs | 2,736,441 | 2,646,008 | Income Tax from Continuing Operations For the six months ended June 30, 2025, income tax from continuing operations was RMB 226.9 million, a 23.8% YoY increase, with Chinese subsidiaries generally subject to a 25% corporate income tax rate, while some eligible enterprises enjoy preferential rates of 5% or 15%. Income Tax Summary for the Six Months Ended June 30 | Item | 2025 (RMB Thousand) | 2024 (RMB Thousand) (Restated) | | :--- | :--- | :--- | | Current Tax — PRC Corporate Income Tax | 248,482 | 311,235 | | Deferred Tax | (21,540) | (127,930) | | Total | 226,942 | 183,305 | - Chinese subsidiaries are subject to a 25% corporate income tax rate, with some small low-profit enterprises enjoying a 5% preferential tax rate, and high-tech enterprises enjoying a 15% preferential tax rate[347][349][351] - Hong Kong registered entities are not subject to Hong Kong profits tax as there was no relevant taxable income during the period[346][348] Earnings Per Share For the six months ended June 30, 2025, basic earnings per share from continuing operations was RMB 0.195, and diluted earnings per share was also RMB 0.195, with basic EPS calculated based on profit attributable to equity holders and weighted average ordinary shares. - For the six months ended June 30, 2025, basic earnings per share from continuing operations was RMB 0.195[352][354] - For the six months ended June 30, 2025, diluted earnings per share was RMB 0.195, which is the same as basic earnings per share because the effect of potential dilutive ordinary shares was not anti-dilutive[356][357][358][359][360] Weighted Average Number of Ordinary Shares for the Six Months Ended June 30 | Item | 2025 (Thousand Shares) | 2024 (Thousand Shares) | | :--- | :--- | :--- | | Ordinary Shares Issued at January 1 | 3,160,786 | 3,188,036 | | Effect of Exercise of Share Options | 37 | – | | Effect of Shares Repurchased | (16,449) | (23,739) | | Weighted Average Number of Ordinary Shares at June 30 | 3,144,374 | 3,164,297 | Investment Properties For the six months ended June 30, 2025, the Group's investment properties increased by RMB 76,136 thousand, primarily comprising office buildings leased out in Hangzhou and Ningbo. - For the six months ended June 30, 2025, investment properties increased by RMB 76,136 thousand[361][366] - These properties primarily consist of office buildings leased out by the Group in Hangzhou and Ningbo[361][366] Property, Plant and Equipment and Right-of-Use Assets For the six months ended June 30, 2025, the Group acquired property, office equipment and furniture, motor vehicles, leasehold improvements, and construction in progress totaling RMB 78,858 thousand, and recognized additional right-of-use assets of RMB 31,496 thousand from lease agreements. - During the period, the Group acquired property, office equipment and furniture, motor vehicles, leasehold improvements, and construction in progress, with a total cost of RMB 78,858 thousand[362][367] - Office equipment, furniture, and motor vehicles with a net book value of RMB 6,027 thousand were disposed of, resulting in a loss on disposal of RMB 3,498 thousand[363][367] - The Group entered into lease agreements for office spaces, teaching buildings, and retail stores, recognizing additional right-of-use assets of RMB 31,496 thousand[364][368] Goodwill For the six months ended June 30, 2025, an impairment loss of RMB 38,424 thousand was recognized for goodwill arising from the acquisition of the Digital Space Department, with impairment testing based on a five-year cash flow projection using specific assumptions for revenue growth, cost of sales percentage, long-term growth rate, and pre-tax discount rate. - For the six months ended June 30, 2025, an impairment loss of RMB 38,424 thousand was recognized for goodwill[365][368] - Impairment testing is based on cash flow projections covering a five-year period, using the following key assumptions[365][369] Key Assumptions for Goodwill Impairment Test as of June 30 | Assumption | Value | | :--- | :--- | | Revenue (Annual Growth Rate %) | 16.0% – 12.0% | | Cost of Sales (% of Revenue) | 64.1% – 59.8% | | Long-term Growth Rate | 2.0% | | Pre-tax Discount Rate | 17.3% | Interest in Associates and Joint Ventures For the six months ended June 30, 2025, the Group recognized an impairment of RMB 13,647 thousand on interests in associates, and acquired an additional 25% equity interest in Hangzhou Jiancheng Asset Management Co., Ltd. for a cash consideration of RMB 47,328 thousand, increasing its stake from 20% to 45% and reclassifying it as a joint venture. - For the six months ended June 30, 2025, an impairment of RMB 13,647 thousand was recognized on interests in associates[371][374] - The Group acquired an additional 25% equity interest in Hangzhou Jiancheng Asset Management Co., Ltd. for a cash consideration of RMB 47,328 thousand, increasing its stake from 20% to 45%[372][375] - Upon completio