朝云集团(06601) - 2025 - 中期财报

Company Profile An overview of the company's business model, strategic pillars, product categories, and core brands Company Overview and Strategic Pillars Chaoyun Group is a leading Chinese multi-category platform for home, pet, and personal care, integrating operations through eight strategic pillars across ten product categories and nine core brands - Chaoyun Group is a leading one-stop multi-category home care, pet products, and personal care platform in China[4] - The company's business structure is based on eight pillars: insight, brand, R&D, marketing, sales, collaboration, management, and operations, achieving a fully integrated business process from market research to sales[4][5] - Successfully launched ten categories, covering home care, pet stores and pet products, and personal care, with rapid development in the pet business[6] - Owns nine core brands, including Weiwang, Chaowei, Beibeijian, Juejiangweiba, Juejiangzuiba, Xilan, Runzhisu, ZhuaZhuaMiaoXingQiu, and Mileguaiguai[6] Corporate Information Key corporate details including board composition, committees, auditors, and listing information Board of Directors and Corporate Structure This section details Chaoyun Group's board members, committee compositions, joint company secretaries, auditors, legal advisors, and other fundamental corporate information - Board members include Executive Directors Chen Danxia (Chairman and CEO), Wang Dong, Zhong Xuyi, Lu Yongji, Non-executive Director Chen Zexing, and Independent Non-executive Directors Yu Rong, Guo Sheng, and Chen Hongjun[7] - The Audit Committee Chairman is Chen Hongjun, Remuneration Committee Chairman is Guo Sheng, and Nomination Committee Chairman is Chen Danxia[7] - The company's auditor is Deloitte Touche Tohmatsu, and legal counsel is Zhou Junxuan Law Firm[7] - The company's stock code is 6601, listed on March 10, 2021[8] Financial Highlights A concise summary of the company's key financial performance and position for the period Core Financial Performance and Position For the six months ended June 30, 2025, Chaoyun Group's revenue grew 7.2% to RMB 1.339 billion, gross profit rose 14.0% to RMB 660 million, and pre-tax profit increased 5.3% to RMB 232 million, while profit for the period slightly decreased 2.7% to RMB 171 million, with stable total equity and liabilities Results Highlights for the Six Months Ended June 30, 2025 | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 1,338,807 | 1,249,136 | 7.2 | | Gross Profit | 659,785 | 579,011 | 14.0 | | Profit Before Tax | 231,701 | 220,065 | 5.3 | | Profit for the Period | 171,106 | 175,873 | (2.7) | | EPS (cents) | 13.02 | 13.46 | (3.3) | Assets, Liabilities, and Equity Highlights as of June 30, 2025 | Indicator | June 30, 2025 (RMB thousands) | Dec 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Non-current Assets | 684,972 | 480,025 | | Current Assets | 2,991,916 | 3,321,678 | | Total Assets | 3,676,888 | 3,801,703 | | Total Equity | 3,052,577 | 2,989,234 | | Total Liabilities | 624,311 | 812,469 | Management Discussion and Analysis Management's review of business performance, financial results, and future strategic outlook Business Overview and Outlook In H1 2025, Chaoyun Group saw sustained performance improvement with stable revenue, cash, and profit growth, driven by home care, pet products, and online channels, while pursuing strategic expansion and high dividend payouts - In H1 2025, the Group focused on customer value, achieving sustained overall performance improvement, adhering to principles of high quality, sustainability, and stable profits[12] Revenue Growth by Product Category (Six Months Ended June 30, 2025) | Product Category | Revenue (RMB millions) | YoY Growth (%) | | :--- | :--- | :--- | | Home Care Products | 1,214.2 | 4.3 | | Pet Stores and Pet Products | 96.0 | 101.4 | | Personal Care Products | 25.8 | (25.8) | Revenue Growth by Sales Channel (Six Months Ended June 30, 2025) | Sales Channel | Revenue (RMB millions) | YoY Growth (%) | | :--- | :--- | :--- | | Online Channels | 517.2 | 27.4 | | Offline Channels | 821.6 | (2.6) | - Insecticide and mosquito repellent products ranked first in comprehensive market share among similar products in China for eleven consecutive years (2015-2025)[14] - Future growth strategies include: expanding high-end natural home care and insecticide/mite removal product lines; increasing pet store coverage and quantity, creating online bestsellers; maintaining market positions on Taobao, JD, Pinduoduo, and rapidly developing content e-commerce like Douyin; deepening offline distribution networks; enhancing R&D capabilities; promoting diversified incentive mechanisms; actively pursuing domestic and international M&A in pet, personal care, cosmetics, and FMCG sectors; and continuing to implement a high dividend payout policy[17] Financial Review Revenue grew 7.2% to RMB 1.339 billion, driven by market opportunities and pet business expansion, with gross margin improving to 49.3% due to brand strength and operational efficiency, while profit for the period slightly declined due to increased income tax expense, and operating cash outflow significantly reduced - Total revenue increased by 7.2% year-on-year to RMB 1,338.8 million, primarily due to seizing market opportunities and actively promoting rapid development in product categories, online channels, and the pet business[19] Revenue and Proportion by Product Category (Six Months Ended June 30, 2025) | Product Category | 2025 (RMB thousands) | 2025 (%) | 2024 (RMB thousands) | 2024 (%) | | :--- | :--- | :--- | :--- | :--- | | Home Care | 1,214,162 | 90.7 | 1,163,557 | 93.1 | | Pet Stores and Pet Products | 95,955 | 7.2 | 47,633 | 3.8 | | Personal Care | 25,776 | 1.9 | 34,752 | 2.8 | | Other | 2,914 | 0.2 | 3,194 | 0.3 | | Total | 1,338,807 | 100.0 | 1,249,136 | 100.0 | Revenue and Proportion by Sales Channel (Six Months Ended June 30, 2025) | Sales Channel | 2025 (RMB thousands) | 2025 (%) | 2024 (RMB thousands) | 2024 (%) | | :--- | :--- | :--- | :--- | :--- | | Online Channels | 517,189 | 38.6 | 405,854 | 32.5 | | Offline Channels | 821,618 | 61.4 | 843,282 | 67.5 | | Total | 1,338,807 | 100.0 | 1,249,136 | 100.0 | - Gross profit increased by 14.0% to RMB 659.8 million, with gross margin rising from 46.4% to 49.3%, mainly benefiting from enhanced brand influence, optimized product and channel structure, and improved supply chain efficiency[24] Gross Profit and Gross Margin by Product Category (Six Months Ended June 30, 2025) | Product Category | 2025 Gross Profit (RMB thousands) | 2025 Gross Margin (%) | 2024 Gross Profit (RMB thousands) | 2024 Gross Margin (%) | | :--- | :--- | :--- | :--- | :--- | | Home Care | 595,839 | 49.1 | 540,137 | 46.4 | | Pet Stores and Pet Products | 55,761 | 58.1 | 23,601 | 49.5 | | Personal Care | 10,340 | 40.1 | 14,716 | 42.3 | | Other | (2,155) | (74.0) | 557 | 17.4 | | Total | 659,785 | 49.3 | 579,011 | 46.4 | - Sales and distribution expenses increased by 28.5% to RMB 408.3 million, consistent with the increased revenue scale of online channels and the pet business[32] - Administrative expenses decreased by 7.8% to RMB 80.1 million, primarily due to improved overall operational efficiency and reduced goodwill impairment losses[33] - Profit for the period slightly decreased by 2.7% to RMB 171.1 million, with net profit margin falling from 14.1% to 12.8%, mainly impacted by increased income tax expense (effective tax rate rose from 20.1% to 26.2%)[37][38] - Net cash outflow from operating activities significantly decreased from RMB 159.7 million to RMB 36.4 million[39] - The capital gearing ratio remained stable at 1.7% as of June 30, 2025[43] Other Financial Information As of June 30, 2025, the Group had no pledged assets or significant contingent liabilities, employee count increased due to pet store expansion, total staff costs remained stable, and an interim dividend of RMB 0.0521 per share was declared, maintaining a 40.0% payout ratio - As of June 30, 2025, the Group had no pledged assets or significant contingent liabilities[48][49] - As of June 30, 2025, the number of employees was 1,321, an increase from 1,140 on June 30, 2024, mainly due to the expansion of the pet offline store business[50] - The Board resolved to declare an interim dividend of RMB 0.0521 per share (equivalent to HKD 0.0571 per share), maintaining a stable payout ratio of 40.0%[51] Other Information Additional disclosures on director and shareholder interests, equity incentive schemes, use of proceeds, and corporate governance Directors' and Chief Executives' Interests and Short Positions in Shares, Underlying Shares, and Debentures As of June 30, 2025, the company's directors and chief executives held long positions in shares and related shares, with Ms. Chen Danxia holding the largest stake, and Ms. Wang Dong and Mr. Zhong Xuyi holding share option interests Directors' Share Interests (As of June 30, 2025) | Director Name | Nature of Interest | Number of Shares (L) | Approximate % of Interest | | :--- | :--- | :--- | :--- | | Chen Danxia | Beneficial Owner | 4,793,500 | 0.36% | | Wang Dong | Beneficial Owner | 401,000 | 0.03% | | Zhong Xuyi | Beneficial Owner | 150,000 | 0.01% | - The number of shares held by Ms. Wang Dong and Mr. Zhong Xuyi includes relevant shares that may be allotted and issued upon full exercise of all outstanding share options granted under the share option scheme[57] Major Shareholders' and Other Persons' Interests and Short Positions in Shares and Underlying Shares As of June 30, 2025, Ms. Ma Huizhen, Ms. Li Ruohong, Mr. Chen Kaixuan, Mr. Chen Kaichen, and Chaoyun Global Limited were major shareholders, each holding a 74.25% interest in the company's issued ordinary shares Major Shareholders' Share Interests (As of June 30, 2025) | Shareholder Name/Entity | Nature of Interest | Number of Shares (L) | Approximate % of Interest | | :--- | :--- | :--- | :--- | | Ms. Ma Huizhen | Interest in Controlled Corporation/Spousal Interest | 990,000,000 | 74.25% | | Ms. Li Ruohong | Interest in Controlled Corporation/Spousal Interest | 990,000,000 | 74.25% | | Mr. Chen Kaixuan | Interest in Controlled Corporation/Spousal Interest | 990,000,000 | 74.25% | | Mr. Chen Kaichen | Interest in Controlled Corporation/Spousal Interest | 990,000,000 | 74.25% | | Chaoyun Global Limited | Beneficial Owner | 990,000,000 | 74.25% | - Ms. Ma and Mr. Chen Kaichen, and Ms. Li and Mr. Chen Kaixuan are spouses and are deemed to have interests in all shares held by each other under the Securities and Futures Ordinance[60] - The entire issued share capital of Chaoyun Global Limited is beneficially owned by Ms. Ma, Ms. Li, Mr. Chen Kaichen, and Mr. Chen Kaixuan[60] Equity Incentive Schemes The company has share option and restricted share award schemes to attract, retain, and incentivize talent, with total options representing 9.64% and restricted shares 1.51% of issued shares, both linked to revenue and net profit growth performance targets - The share option scheme aims to attract, retain, and incentivize talented employees, aligning company value with participant interests[61] - As of the report date, the total number of share options available for grant under the scheme is 128,533,350, representing approximately 9.64% of the total issued shares[63] - The share option scheme's assessment mechanism includes the Group's revenue growth rate and net profit growth rate (each with 50% weighting), which will determine the performance factor and individual vesting ratio[68][70] - The restricted share award scheme aims to align management and shareholder interests, incentivize management to achieve performance targets, and attract external talent[72] - The maximum number of award shares that can be granted under the restricted share award scheme is 25,000,000 shares, representing 1.87% of the total issued shares[73] - As of the report date, a total of 4,800,000 unexercised restricted shares have been granted to three directors, one consultant, and four employees[80] - The assessment mechanism for the restricted share award scheme is similar to the share option scheme, also using the Group's revenue growth rate and net profit growth rate as key performance indicators[77][79] Use of Proceeds from Global Offering The company received net proceeds of approximately RMB 2.419 billion from its global offering, with RMB 714 million utilized by June 30, 2025, and the remaining RMB 1.704 billion allocated for R&D, channel expansion, marketing, supply chain, digitalization, and strategic acquisitions - The company received net proceeds of approximately RMB 2,418.8 million from its global offering[82] Use and Utilization of Proceeds from Global Offering (As of June 30, 2025) | Item | Approximate % of Total Net Proceeds | Net Proceeds from Global Offering (RMB millions) | Actual Net Utilized as of June 30, 2025 (RMB millions) | Unutilized Net as of June 30, 2025 (RMB millions) | Expected Full Utilization Timeline | | :--- | :--- | :--- | :--- | :--- | :--- | | New product R&D, existing product upgrades, and new brand/category development | 7.1% | 171.8 | 84.4 | 87.4 | Before end of 2026 | | Promoting R&D center construction and upgrades | 10.2% | 246.7 | 0 | 246.7 | Before end of 2026 | | Incentivizing and recruiting R&D talent | 2.7% | 65.3 | 0 | 65.3 | Before end of 2026 | | Further developing online distribution channels | 10.0% | 241.9 | 241.9 | 0 | N/A | | Further strengthening offline distribution network | 5.0% | 120.9 | 46.5 | 74.4 | Before end of 2026 | | Establishing and optimizing overseas online and offline sales networks | 5.0% | 120.9 | 0 | 120.9 | Before end of 2026 | | Increasing market penetration in lower-tier cities | 5.0% | 120.9 | 10.2 | 110.7 | Before end of 2026 | | Investing in online brand marketing activities | 10.0% | 241.9 | 146.5 | 95.4 | Before end of 2026 | | Establishing overseas supply chain | 1.5% | 36.3 | 0 | 36.3 | Before end of 2026 | | Upgrading production facilities and production lines | 1.5% | 36.3 | 0 | 36.3 | Before end of 2026 | | Establishing supply chain base in Shanghai | 7.0% | 169.3 | 0 | 169.3 | Before end of 2026 | | Deepening digitalization strategy, strengthening IT infrastructure | 10.0% | 241.9 | 10.8 | 231.1 | Before end of 2026 | | Strategic acquisitions of upstream and downstream businesses | 15.0% | 362.8 | 174.1 | 188.7 | Before end of 2026 | | Working capital and other general corporate purposes | 10.0% | 241.9 | 0 | 241.9 | Before end of 2026 | | Total | 100.0% | 2,418.8 | 714.4 | 1,704.4 | | - As of June 30, 2025, the remaining proceeds of approximately RMB 1,704.4 million will continue to be used according to the prospectus and deposited in reputable banks in Hong Kong or mainland China[85] Corporate Governance The company maintains high corporate governance standards, adhering to Listing Rules Appendix C1, with the Chairman and CEO roles combined for leadership consistency, balanced by independent non-executive directors, and confirms compliance with director securities dealing standards and public float requirements - The company has adopted and complied with all applicable code provisions of Appendix C1 of the Listing Rules on Corporate Governance during the reporting period[86] - The roles of Chairman and CEO are combined and held by Ms. Chen Danxia; the Board believes this arrangement facilitates consistent leadership and efficient strategic planning, with independent non-executive directors ensuring a balance of power[87] - All directors confirmed compliance with the Model Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix C3 of the Listing Rules throughout the reporting period[88] - As of the report date, the company's public float meets Listing Rules requirements, with at least 25% of total issued shares held by the public[91] Subsequent Events No significant post-balance sheet events occurred after the reporting period - No significant subsequent events occurred after the reporting period[94] Audit Committee The Audit Committee, comprising three independent non-executive directors and one non-executive director, reviewed the Group's unaudited condensed consolidated financial statements for the six months ended June 30, 2025, and received the independent auditor's review report - The Audit Committee comprises Mr. Chen Hongjun (Chairman), Mr. Guo Sheng, Dr. Yu Rong (Independent Non-executive Directors), and Mr. Chen Zexing (Non-executive Director)[95] - The Audit Committee has reviewed the Group's unaudited condensed consolidated financial statements for the six months ended June 30, 2025[95] - The Group's unaudited condensed consolidated financial statements have been reviewed by independent auditor Deloitte Touche Tohmatsu[95] Changes in Directors' Information No changes in director information have occurred since the publication of the company's 2024 annual report - No changes in directors' information requiring disclosure under paragraphs (a) to (e) and (g) of Rule 13.51(2) of the Listing Rules have occurred since the publication of the company's 2024 annual report[96] Review Report on Condensed Consolidated Financial Statements The independent auditor's review opinion on the condensed consolidated financial statements Review Opinion Independent auditor Deloitte Touche Tohmatsu reviewed Chaoyun Group's condensed consolidated financial statements for the six months ended June 30, 2025, finding no material non-compliance with IAS 34 - Independent auditor Deloitte Touche Tohmatsu has reviewed Chaoyun Group's condensed consolidated financial statements for the six months ended June 30, 2025[98][99] - The scope of review is substantially less than that of an audit, and accordingly, no audit opinion is expressed[99] - The auditor found no matters that cause them to believe the condensed consolidated financial statements are not prepared, in all material respects, in accordance with International Accounting Standard 34[100] Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income A summary of the company's revenue, profit, and comprehensive income for the reporting period Profit or Loss and Comprehensive Income Overview For the six months ended June 30, 2025, the company reported RMB 1.339 billion in revenue, RMB 660 million in gross profit, RMB 171 million in profit for the period, and RMB 154 million in total comprehensive income, primarily impacted by exchange differences Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (Six Months Ended June 30, 2025) | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Revenue | 1,338,807 | 1,249,136 | | Gross Profit | 659,785 | 579,011 | | Profit Before Tax | 231,701 | 220,065 | | Profit for the Period | 171,106 | 175,873 | | Total Comprehensive Income for the Period | 154,276 | 184,113 | | Basic EPS (RMB cents) | 13.02 | 13.46 | - Exchange differences arising from the translation of foreign operations resulted in other comprehensive expenses of RMB 16,830 thousand[102] Condensed Consolidated Statement of Financial Position An overview of the company's assets, liabilities, and equity as of the reporting date Assets, Liabilities, and Equity Position As of June 30, 2025, total assets were RMB 3.677 billion, with current assets being the largest component; total equity was RMB 3.053 billion, and total liabilities were RMB 624 million, with a higher proportion of current liabilities Condensed Consolidated Statement of Financial Position (As of June 30, 2025) | Indicator | June 30, 2025 (RMB thousands) | Dec 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Non-current Assets | 684,972 | 480,025 | | Current Assets | 2,991,916 | 3,321,678 | | Total Assets | 3,676,888 | 3,801,703 | | Equity Attributable to Owners of the Company | 3,056,681 | 2,990,882 | | Non-controlling Interests | (4,104) | (1,648) | | Total Equity | 3,052,577 | 2,989,234 | | Non-current Liabilities | 29,169 | 30,493 | | Current Liabilities | 595,142 | 781,976 | | Total Liabilities | 624,311 | 812,469 | - Net current assets were RMB 2,396,774 thousand, a decrease from RMB 2,539,702 thousand as of December 31, 2024[104] Condensed Consolidated Statement of Changes in Equity Analysis of changes in the company's equity attributable to owners during the period Analysis of Changes in Equity For the six months ended June 30, 2025, total equity attributable to owners increased to RMB 3.057 billion, with profit for the period at RMB 174 million, but exchange reserves decreased by RMB 16.83 million due to exchange differences, and dividends of RMB 90.93 million were recognized Condensed Consolidated Statement of Changes in Equity (Six Months Ended June 30, 2025) | Item | June 30, 2025 (RMB thousands) | June 30, 2024 (RMB thousands) | | :--- | :--- | :--- | | Total equity at beginning of period | 2,989,234 | 2,937,472 | | Profit (loss) for the period | 171,106 | 175,873 | | Total other comprehensive (expense) income for the period | (16,830) | 8,240 | | Dividends recognized as distribution | (90,933) | (85,333) | | Total equity at end of period | 3,052,577 | 3,027,292 | - Exchange reserve decreased by RMB 16,830 thousand due to other comprehensive expenses (exchange differences) during the period[105] - Dividends recognized as distribution during the period amounted to RMB 90,933 thousand[105] Condensed Consolidated Statement of Cash Flows A summary of cash flows from operating, investing, and financing activities Cash Flow Analysis For the six months ended June 30, 2025, net cash used in operating activities significantly decreased to RMB 36.38 million, net cash from investing activities was RMB 381 million, and net cash used in financing activities was RMB 11.37 million, with cash and cash equivalents increasing to RMB 1.508 billion at period-end Condensed Consolidated Statement of Cash Flows (Six Months Ended June 30, 2025) | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Net cash used in operating activities | (36,381) | (159,710) | | Net cash from (used in) investing activities | 381,434 | (155,696) | | Net cash used in financing activities | (11,367) | (18,465) | | Net increase (decrease) in cash and cash equivalents | 333,686 | (333,871) | | Cash and cash equivalents at end of period | 1,507,932 | 1,213,034 | - Net cash used in operating activities significantly decreased, primarily due to improved working capital movements, especially reduced inventories[107] - Net cash from investing activities primarily resulted from withdrawals of time deposits and disposal of financial assets at fair value through profit or loss[107] Notes to the Condensed Consolidated Financial Statements Detailed notes providing additional information on the financial statements, accounting policies, and specific line items Basis of Preparation and Accounting Policies The condensed consolidated financial statements are prepared under IAS 34 and HKEX Listing Rules, using historical cost, with the first-time application of IAS 21 (amended) 'Lack of Exchangeability' having no material impact on financial position or performance - The condensed consolidated financial statements are prepared in accordance with International Accounting Standard 34 'Interim Financial Reporting' and the applicable disclosure requirements of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[108] - The financial statements have been prepared on the historical cost basis, except for certain financial instruments measured at fair value[109] - The Group first applied IAS 21 (amended) 'Lack of Exchangeability' in this interim period, which had no material impact on its financial position and performance[110] Revenue and Segment Information For the six months ended June 30, 2025, revenue primarily from home care products was recognized at a point in time, with RMB 46.93 million allocated to remaining performance obligations expected to be recognized within twelve months, and the company operates as a single segment primarily in China Revenue by Product or Service Category (Six Months Ended June 30, 2025) | Product or Service Category | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Home Care | 1,214,162 | 1,163,557 | | Pet Stores and Pet Products | 95,955 | 47,633 | | Personal Care | 25,776 | 34,752 | | Other | 2,914 | 3,194 | | Total | 1,338,807 | 1,249,136 | - All revenue is recognized at a point in time[112] - As of June 30, 2025, the total transaction price allocated to remaining performance obligations was approximately RMB 46,925 thousand, expected to be recognized as revenue within the next twelve months[113] - The Group primarily operates in China, with almost all revenue and non-current assets derived from China[114] - In both years, no revenue from transactions with a single external customer accounted for 10% or more of the Group's revenue[115] Other Income and Expenses For the six months ended June 30, 2025, other income totaled RMB 55.32 million, mainly from bank interest and government grants, with other gains and losses showing a net gain of RMB 9.60 million, primarily from foreign exchange; sales and distribution expenses rose to RMB 408 million, administrative expenses decreased to RMB 80.05 million, and income tax expense increased to RMB 60.60 million due to higher pre-tax profit and a subsidiary's tax rate Other Income (Six Months Ended June 30, 2025) | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Government grants | 12,029 | 9,018 | | Bank interest income | 34,362 | 43,910 | | Interest income from other financial assets measured at amortized cost | 6,151 | 5,164 | | Investment income from financial assets at FVTPL | 2,337 | 1,416 | | Other | 443 | 489 | | Total | 55,322 | 59,997 | Other Gains and Losses (Six Months Ended June 30, 2025) | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Net foreign exchange gain (loss) | 9,521 | (1,237) | | Fair value change loss on financial assets at FVTPL | – | (10,016) | | Total | 9,596 | (11,684) | - Sales and distribution expenses increased by 28.5% to RMB 408,262 thousand, mainly due to increased e-commerce channel marketing and advertising service fees[119] - Administrative expenses decreased by 7.8% to RMB 80,054 thousand[33] - Income tax expense increased by 37.1% to RMB 60,595 thousand, with the effective tax rate rising from 20.1% to 26.2%, primarily due to increased profit before tax and a temporary tax rate increase for a subsidiary undergoing high-tech enterprise qualification renewal[37][121][122] Profit for the Period Composition (Six Months Ended June 30, 2025) | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Total staff costs | 111,633 | 112,093 | | Total depreciation | 20,988 | 18,204 | | R&D costs (included in administrative expenses) | 12,488 | 13,029 | | Cost of inventories recognized as expense | 677,981 | 670,319 | Dividends and Earnings Per Share The company declared a 2024 final dividend of RMB 0.0682 per share and a 2025 interim dividend of RMB 0.0521 per share post-period, with basic earnings per share at RMB 13.02 cents for the six months ended June 30, 2025, and no dilution from share options - A final dividend of RMB 0.0682 per ordinary share was declared for the year ended December 31, 2024[126] - Subsequent to the reporting period, the Directors resolved to declare an interim dividend of RMB 0.0521 per ordinary share, payable to shareholders on the register as of September 11, 2025[126] Earnings Per Share (Six Months Ended June 30, 2025) | Indicator | 2025 (RMB thousands/thousand shares) | 2024 (RMB thousands/thousand shares) | | :--- | :--- | :--- | | Profit for basic EPS calculation | 173,562 | 179,461 | | Weighted average number of ordinary shares for basic EPS calculation | 1,333,334 | 1,333,334 | | Basic EPS (RMB cents) | 13.02 | 13.46 | - No exercise of share options was assumed in calculating diluted earnings per share, as their exercise price was higher than the average market price of the company's shares[127] Details of Assets and Liabilities This section details property, plant and equipment, right-of-use assets, financial assets at FVTPL, deferred tax assets, inventories, trade and other receivables, related party balances, other financial assets at amortized cost, time deposits, trade and other payables, and contract liabilities, noting trade receivables' 30-60 day credit term with ECL provisions, decreased inventories, and reduced contract liabilities - During the interim period, the Group incurred capital expenditure of approximately RMB 6,859 thousand for the acquisition of property, plant, and equipment[128] - Financial assets at fair value through profit or loss primarily consist of unlisted equity investments, totaling RMB 111,923 thousand[129] Deferred Tax Assets (As of June 30, 2025) | Item | June 30, 2025 (RMB thousands) | Dec 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Deferred tax assets | 63,684 | 60,400 | Inventory Composition (As of June 30, 2025) | Item | June 30, 2025 (RMB thousands) | Dec 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Raw Materials | 29,015 | 41,097 | | Work-in-progress | 8,561 | 12,942 | | Finished Goods | 115,769 | 263,988 | | Total | 153,345 | 318,027 | - Trade receivables typically have a credit period of 30 to 60 days from invoice date; as of June 30, 2025, total trade receivables were RMB 79,070 thousand, with an expected credit loss provision of RMB 4,270 thousand[132][134] - As of June 30, 2025, amounts due from related parties were RMB 48,341 thousand, and amounts due to related parties were RMB 33,137 thousand[137][141] - Other financial assets measured at amortized cost include bonds and asset management schemes, totaling RMB 296,271 thousand[144] - Total time deposits amounted to RMB 1,714,283 thousand, bearing fixed annual interest rates ranging from 1.40% to 5.30%[146] - Trade payables typically have a credit period of 20 to 60 days; as of June 30, 2025, total trade payables were RMB 159,623 thousand[149][150] - Contract liabilities (advances from customers) significantly decreased to RMB 46,925 thousand[152] Share Capital and Share-based Payment Transactions The company's authorized share capital is 250 billion shares, with 1.333 billion issued and fully paid shares; share award and option schemes aim to incentivize employees, but no new share-based payment expenses were recognized for the six months ended June 30, 2025 - The company's authorized share capital is 250,000,000,000 shares with a par value of USD 0.0000002[153] - Issued and fully paid share capital consists of 1,333,333,500 shares, with share capital stated as RMB 2 thousand[153] - No share-based payment expenses were recognized under the share award scheme and share option scheme for the six months ended June 30, 2025[155][157] - No share options vested or were exercised for the six months ended June 30, 2025[157] Capital Commitments and Fair Value Measurement of Financial Instruments As of June 30, 2025, contracted but unprovided capital expenditure for property, plant, and equipment was RMB 1.37 million; financial assets at fair value are measured using market approach and classified as Level 3, with management deeming carrying amounts of financial assets and liabilities at amortized cost approximate their fair values Capital Commitments (As of June 30, 2025) | Item | June 30, 2025 (RMB thousands) | Dec 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Contracted but unprovided capital expenditure for property, plant and equipment | 1,369 | 258 | - Financial assets at fair value through profit or loss are valued using the market approach, with key inputs including comparable company market multiples, IPO, redemption, and liquidation probabilities, risk-free rates, and expected volatility, classified as Level 3 fair value measurements[160] - Management believes that the carrying amounts of financial assets and financial liabilities measured at amortized cost approximate their fair values[161] Related Party Transactions The Group engaged in various related party transactions with entities under common control by the controlling shareholder, including sales, purchases, testing, sales support, warehouse, IT services, short-term lease fees, lease liability payments, and property management fees, with director remuneration also disclosed as key management personnel compensation Related Party Transactions (Six Months Ended June 30, 2025) | Transaction Type | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Sales to related parties | 94,926 | 113,590 | | Provision of testing services to related parties | 126 | 57 | | Purchases from related parties | 66,564 | 79,698 | | Sales support service fees | 27,594 | 28,320 | | Warehouse service fees | 4,500 | 4,500 | | IT service fees | 1,150 | 1,150 | | Short-term lease related fees | 571 | 1,248 | | Lease liability payments | 3,045 | 3,112 | | Property management fees | 1,786 | 932 | - Directors' remuneration is disclosed in Note 9 as part of key management personnel compensation[165]