开拓药业(09939) - 2025 - 中期财报

Corporate Information Board of Directors and Committees The company's Board of Directors comprises executive, non-executive, and independent non-executive directors, with audit, nomination, and remuneration committees ensuring a sound corporate governance structure - Board members include Dr. Tong Youzhi (Chairman and CEO) and Dr. Ni Xiang (Executive Director)[4] - The Audit, Nomination, and Remuneration Committees are all chaired by independent non-executive directors[4][5] Company Details and Contacts This section provides essential contact and registration information, including the company's registered office, China headquarters, Hong Kong principal place of business, legal advisors, auditors, share registrar, principal bankers, company website, and stock code - The company is registered in the Cayman Islands, with its China headquarters in Suzhou, Jiangsu Province, and its principal place of business in Hong Kong located in Wan Chai[7] - The auditor is PricewaterhouseCoopers, and the Hong Kong share registrar is Hong Kong Registrars Limited[8][9] - The company's stock code is 9939, with a board lot size of 500 shares[10] Financial and Business Highlights FINANCIAL HIGHLIGHTS For the six months ended June 30, 2025, the company's revenue significantly increased to RMB 6.0 million, primarily driven by global sales of the high-end cosmetic brand KOSHINÉ; however, net loss expanded by 16.5% to RMB 83.3 million due to increased R&D and marketing costs, partially offset by reduced administrative expenses, with cash and cash equivalents at RMB 52.9 million and no interim dividend declared 2025 H1 Financial Highlights | Metric | As of June 30, 2025 (RMB million) | As of June 30, 2024 (RMB million) | Change (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Revenue | 6.0 | 0 | 6.0 | N/A | | Net Loss | (83.3) | (71.5) | (11.8) | 16.5% | | R&D Costs | 48.6 | 39.3 | 9.3 | 23.6% | | Administrative Expenses | 25.2 | 33.9 | (8.7) | (25.6%) | | Marketing Costs | 8.3 | 1.8 | 6.5 | 369.0% | | Cash and Cash Equivalents (End of Period) | 52.9 | N/A | N/A | N/A | - Revenue growth is primarily attributed to global sales of the new high-end cosmetic brand KOSHINÉ[13] - Increased R&D costs are mainly due to the Group's enhanced focus on core dermatology pipelines KX-826 and GT20029[13] - Reduced administrative expenses are primarily due to decreased employee benefits, travel, and office expenses resulting from layoffs during the reporting period[13] - Significant increase in marketing costs is mainly due to higher marketing and promotion expenses for the KOSHINÉ cosmetic and raw material businesses[13] - The Board resolved not to declare an interim dividend for the six months ended June 30, 2025[20] BUSINESS HIGHLIGHTS As of the report date, the company achieved significant progress with its two core dermatology products, KX-826 and GT20029, and the new whitening raw material KT-939; KX-826 met primary endpoints in both long-term safety Phase III clinical trials and clinical observation studies for alopecia, demonstrating excellent safety and efficacy, while GT20029's China Phase II clinical trial for acne also successfully reached its primary endpoint, and KT-939 completed its first sale as a functional whitening ingredient, establishing a "three-pronged" business model - Topline data from the KX-826 topical solution long-term safety Phase III clinical trial for alopecia in China met the primary endpoint, demonstrating excellent safety and efficacy[19][21] - Clinical observation study of KX-826 combined with minoxidil for male androgenetic alopecia in China reached its primary endpoint, validating the clinical advantages of the combination therapy[19][21] - Topline data from the KX-826 topical solution 1.0% pivotal Phase II clinical trial for alopecia demonstrated excellent efficacy and safety[27][29] - The pivotal Phase III clinical trial of KX-826 topical solution 1.0% for alopecia has completed enrollment of 666 patients, with completion anticipated in early 2026[27][29] - Topline data from the China Phase II clinical trial of AR-PROTAC compound GT20029 gel for acne successfully met the primary endpoint, determining the recommended Phase III clinical trial dose as 0.5%[23][25] - KT-939 completed its first sale as a functional whitening and spot-reducing cosmetic raw material, forming a "three-pronged" business model encompassing B2B functional cosmetic raw materials, B2C functional cosmetic products, and topical innovative drug R&D[28][30] Management Discussion and Analysis OVERVIEW The company is a clinical-stage innovative drug developer focused on dermatology and oncology, extending its business into functional cosmetics; the cosmetic business (KOSHINÉ brand) provides both funding for drug R&D and valuable market data, with core products KX-826 and GT20029 showing rapid clinical trial progress and positive results in China and the US - The company is a clinical-stage innovative drug enterprise in China focused on addressing unmet clinical needs and expanding into functional cosmetics[33][35] - The development of the cosmetic business provides necessary funding for drug R&D activities and market data for future pharmaceutical sales strategies[33][35] - Since the official launch of the new high-end cosmetic brand KOSHINÉ in the second half of 2024, eight products have been launched, including anti-hair loss liquid, acne cream, and whitening series[34][35] - KX-826 has completed multiple trials for male alopecia in China, including pivotal Phase II and long-term safety Phase III clinical trials, demonstrating excellent efficacy and safety[41][42] - GT20029 is the world's first topical PROTAC compound to complete Phase II clinical trials, with topline data from its China acne Phase II clinical trial determining the recommended Phase III dose as 0.5%[43][45] Product Pipeline The company possesses a risk-balanced and diversified drug pipeline covering dermatology (e.g., alopecia, acne) and oncology, aiming to address significant unmet medical needs; core products KX-826 and GT20029 have made breakthrough progress in dermatology, with active exploration of commercialization paths including the launch of the high-end cosmetic brand KOSHINÉ, while other products like GT1708F, GT0486, and ALK-1 antibody have accumulated substantial clinical data, indicating high commercial collaboration value - The company's pipeline includes 5 potential first-in-class/best-in-class drugs in Phase I-III clinical stages and 1 new whitening raw material, KT-939[15][17] - KX-826 has completed patient enrollment for its pivotal Phase III clinical trial for male alopecia in China, and its long-term safety Phase III trial met the primary endpoint[49][50] - The Phase II clinical trial of AR-PROTAC compound GT20029 for acne in China has reached its primary endpoint[49][50] - GT1708F has received conditional approval for a Phase II clinical trial for IPF indication in China and completed a Phase I clinical trial for hematological malignancies in China[49][50] BUSINESS REVIEW This section details the development progress of the company's five clinical-stage drugs and one new raw material; core products KX-826 and GT20029 demonstrated good safety and efficacy in clinical trials for alopecia and acne, achieving multiple milestones, while other pipelines like GT1708F, GT0486, and ALK-1 antibody continue to advance in oncology and idiopathic pulmonary fibrosis, and the new raw material KT-939 completed its first sale and entered long-term safety trials Main Products The company's main product lines include KX-826 (AR antagonist), AR-PROTAC compound GT20029, Hedgehog/SMO inhibitor GT1708F, mTOR kinase inhibitor GT0486, and ALK-1 antibody GT90001; these products show significant clinical progress and positive trial results in dermatology (alopecia, acne) and oncology (IPF, hematological malignancies, liver cancer, solid tumors), with KX-826 and GT20029 already in late-stage clinical development - KX-826 is a topical AR antagonist, with its core patent valid until September 8, 2030, used for treating alopecia and acne[53][54][56] - GT20029 is the world's first topical AR-PROTAC compound to complete Phase II clinical trials, with the potential to become a new generation treatment for alopecia and acne[79][82] - GT1708F is a Hedgehog/SMO signaling pathway inhibitor, primarily used for treating IPF and hematological malignancies, and has received conditional approval from China's NMPA to conduct a Phase II clinical trial for IPF[92][94][98][101] - ALK-1 antibody (GT90001) is a potential first-in-class antibody that inhibits ALK-1/TGF-β signaling and tumor angiogenesis, used for treating various solid tumors, especially in combination with PD-1 inhibitors for advanced HCC[104][107] - GT0486 is a PI3K/mTOR signaling pathway inhibitor, having completed Phase I clinical trials, primarily used for treating metastatic solid tumors such as breast cancer, prostate cancer, and HCC[109][112] - c-Myc molecular glue holds significant R&D potential, with related research published in core journals like Nature Communications, demonstrating its excellent potential in tumor treatment[110][113] New Raw Material (KT-939) KT-939 is a tyrosinase inhibitor with melanin-inhibiting, antioxidant, and anti-inflammatory properties; this raw material has received approval from the International Nomenclature Committee for Cosmetic Ingredients (INCI) and the Japan Cosmetic Industry Association (JNCI), completed its first sale, and its human long-term safety trial has completed subject enrollment - KT-939 effectively inhibits melanin production, possesses antioxidant and anti-inflammatory properties, and is actively preparing for registration as a new cosmetic ingredient in China[114][119] - KT-939 has received INCI review approval (Mono ID 39815) and JNCI approval, and completed its first sale as a functional whitening and spot-reducing cosmetic raw material[114][115][119] - The human long-term safety trial for KT-939 has completed enrollment of 130 subjects, primarily focusing on the skin safety of continuous 48-week topical application of 0.2% KT-939[116][119] RESEARCH AND DEVELOPMENT The company has established an integrated R&D platform focused on AR inhibitors and PROTAC technology, achieving significant progress in dermatology with KX-826 and GT20029; R&D efforts are led by an experienced team of scientists, actively exploring combination therapies and external collaboration opportunities to accelerate drug commercialization and enhance R&D capabilities - The company has established an integrated R&D platform supporting drug development projects from discovery to clinical stages, primarily utilizing internal R&D resource management processes[121][124] - The company has accumulated industry-leading expertise in AR signaling pathways, molecular design, and PK/PD modeling, utilizing its AR technology platform to develop KX-826[122][124] - PROTAC is a novel drug discovery technology; the company developed GT20029 based on the PROTAC platform for alopecia and acne, making GT20029 the world's first topical PROTAC compound to complete Phase IIa clinical trials for alopecia and Phase II clinical trials for acne in China[123][125] - The company possesses molecular glue technology for targeting and/or degrading undruggable and oncogene mutation drivers[123][125] - The company also has 3 other clinical-stage products and is actively seeking co-development or out-licensing opportunities to unlock drug value[126][130] MANUFACTURING AND COMMERCIALISATION Since the launch of the high-end cosmetic brand KOSHINÉ in the second half of 2024, the company has gradually established a product matrix including anti-hair loss liquid, acne cream, and whitening series; cosmetic production is currently outsourced, and the company plans to strengthen market promotion, expand product application scenarios, accelerate global market expansion, and expedite the launch of new cosmetics to enhance brand awareness and market penetration - Sales of the new high-end cosmetic brand KOSHINÉ officially commenced in the second half of 2024, and a product matrix has been gradually established[128][131] - Cosmetic production is currently outsourced, involving no facility construction or equipment installation[128][131] - The company will continue to focus on the dermatology sector, strengthen market promotion, expand product application scenarios, accelerate global market expansion, and expedite the launch of new cosmetics[129][131] FINANCIAL REVIEW This section details the financial performance for the six months ended June 30, 2025; the company recorded its first cosmetic and raw material sales revenue of RMB 6.0 million, but net loss expanded to RMB 83.3 million, primarily due to increased R&D and marketing costs, while administrative expenses decreased due to layoffs; the company faces liquidity pressure with a significant reduction in cash and cash equivalents and a declining current ratio, actively seeking various financing avenues to alleviate this pressure Overview of Financial Performance For the six months ended June 30, 2025, the company recorded RMB 6.0 million in cosmetic and raw material sales revenue, compared to zero in the prior year period; net loss for the period increased by 16.5% to RMB 83.3 million, primarily due to increased R&D and marketing costs 2025 H1 Financial Overview | Metric | As of June 30, 2025 (RMB million) | As of June 30, 2024 (RMB million) | Change (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Revenue | 6.0 | 0 | 6.0 | N/A | | Loss and Total Comprehensive Loss | (83.3) | (71.5) | (11.8) | 16.5% | - Revenue growth primarily benefited from global sales of the high-end cosmetic brand KOSHINÉ[132][136] - Operating loss primarily stemmed from R&D costs and administrative expenses[132][136] Operating Expenses Analysis During the reporting period, the company's other income significantly decreased by 79.5% to RMB 1.3 million, mainly due to reduced government grants and bank interest income; marketing costs surged by 369.0% to RMB 8.3 million, primarily for KOSHINÉ cosmetic promotion and team expansion; administrative expenses decreased by 25.6% to RMB 25.2 million due to layoffs; R&D costs increased by 23.6% to RMB 48.6 million, mainly driven by the rapid advancement of KX-826 and GT20029 clinical trials 2025 H1 Other Income Changes | Metric | As of June 30, 2025 (RMB million) | As of June 30, 2024 (RMB million) | Change (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Other Income | 1.3 | 6.1 | (4.9) | (79.5%) | 2025 H1 Marketing Cost Details | Item | As of June 30, 2025 (RMB thousand) | Share of Total (%) | As of June 30, 2024 (RMB thousand) | Share of Total (%) | | :--- | :--- | :--- | :--- | :--- | | Marketing and Promotion Expenses | 4,872 | 58.9 | — | 0.0 | | Employee Benefits Expenses (incl. share-based compensation) | 3,098 | 37.4 | 1,266 | 71.8 | | Total | 8,274 | 100.0 | 1,764 | 100.0 | - Marketing costs increased by 369.0% to RMB 8.3 million, primarily due to a RMB 4.9 million increase in marketing and promotion expenses and a RMB 1.8 million increase in personnel costs from marketing team expansion[146][147] 2025 H1 Administrative Expense Details | Item | As of June 30, 2025 (RMB thousand) | Share of Total (%) | As of June 30, 2024 (RMB thousand) | Share of Total (%) | | :--- | :--- | :--- | :--- | :--- | | Employee Benefits Expenses (incl. share-based compensation) | 14,976 | 59.4 | 18,864 | 55.6 | | Utilities and Office Expenses | 3,580 | 14.2 | 6,901 | 20.4 | | Depreciation and Amortization | 3,055 | 12.1 | 4,340 | 12.8 | | Total | 25,231 | 100.0 | 33,908 | 100.0 | - Administrative expenses decreased by 25.6% to RMB 25.2 million, mainly due to a RMB 3.9 million reduction in employee benefits (due to staff reduction), a RMB 3.3 million decrease in utilities and office expenses, and a RMB 1.3 million reduction in depreciation and amortization[153][155] 2025 H1 R&D Cost Details | Item | As of June 30, 2025 (RMB thousand) | Share of Total (%) | As of June 30, 2024 (RMB thousand) | Share of Total (%) | | :--- | :--- | :--- | :--- | :--- | | Clinical Research Expenses | 20,375 | 41.9 | (1,777) | (4.5) | | Employee Benefits Expenses (incl. share-based compensation) | 15,404 | 31.7 | 29,335 | 74.6 | | Third-Party Contract Fees | 4,619 | 9.5 | 5,033 | 12.8 | | Total | 48,617 | 100.0 | 39,332 | 100.0 | - R&D costs increased by 23.6% to RMB 48.6 million, primarily due to a RMB 22.2 million increase in clinical research expenses (driven by KX-826 and GT20029 clinical trial advancements), partially offset by a RMB 13.9 million reduction in R&D employee benefits expenses[159][164] Non-IFRS Financial Measures The company uses adjusted loss and total comprehensive loss (excluding share-based compensation expenses) as a non-IFRS financial measure to provide a clearer view of operating performance, facilitating shareholder and investor understanding and evaluation of the company's performance, and enabling period-over-period and company-to-company comparisons - Adjusted loss and total comprehensive loss exclude non-cash items such as share-based compensation expenses to reflect the Group's normal operating performance[169][170][171] Reconciliation of Loss for the Period to Adjusted Loss | Metric | As of June 30, 2025 (RMB thousand) | As of June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Loss and Total Comprehensive Loss for the Period | (83,268) | (71,493) | | Add: Share-based Compensation Expenses | (443) | 4,600 | | Adjusted Loss and Total Comprehensive Loss for the Period | (83,711) | (66,893) | Human Resources and Compensation As of June 30, 2025, the company had 136 full-time employees, with clinical and R&D functions accounting for nearly 43%; the company has established a compensation package including base salary, position-specific pay, performance bonuses, and project bonuses, and utilizes the 2020 Employee Incentive Scheme to retain and motivate key management and staff Employee Function Distribution as of June 30, 2025 | Function | Number of Employees | Percentage of Total | | :--- | :--- | :--- | | Core Management | 6 | 4.4% | | Clinical | 22 | 16.2% | | R&D | 36 | 26.5% | | Production | 16 | 11.8% | | Commercialization | 23 | 16.9% | | Project Management | 9 | 6.6% | | Other | 24 | 17.6% | | Total | 136 | 100.0% | - The total number of employees in clinical and R&D functions accounts for nearly 43%[178][183] - The company utilizes the 2020 Employee Incentive Scheme to retain and motivate key management and staff[178][183] Liquidity and Capital Management As of June 30, 2025, the company's cash and cash equivalents significantly decreased by 64.1% to RMB 52.9 million, and the current ratio dropped from 103.0% to 44.3%, resulting in net current liabilities of RMB 79.6 million and facing significant liquidity risk; to mitigate this risk, the company is implementing multiple plans, including seeking bank credit renewal, equity financing (such as the 2025 "placing of existing shares and subscription of new shares"), out-licensing pipeline drugs, and expanding cosmetic sales channels Liquidity Position | Metric | As of June 30, 2025 (RMB million) | As of December 31, 2024 (RMB million) | Change (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Cash and Cash Equivalents | 52.9 | 147.4 | (94.6) | (64.1%) | | Net Current Assets/(Liabilities) | (79.6) | 5.1 | (84.7) | N/A | | Current Ratio | 44.3% | 103.0% | (58.7%) | N/A | - The decrease in cash and cash equivalents is primarily due to R&D and administrative expenses, as well as loan repayments[180][185] - The company is implementing multiple plans and measures, such as the 2025 "placing of existing shares and subscription of new shares", to ensure continued support for clinical trials and R&D advancement[18][20] - As of June 30, 2025, the company had utilized RMB 87.0 million in bank financing and had RMB 30.0 million in unutilized bank financing[181][185] - As of June 30, 2025, total bank borrowings amounted to RMB 86.983 million, with all borrowings repayable within one year or on demand[208][209][333] Financial Risk Management The company faces market risks (including foreign exchange risk, cash flow and fair value interest rate risk), credit risk, and liquidity risk; management monitors foreign exchange risk, anticipating minimal impact from interest rate changes on interest-bearing assets; credit risk is low due to deposits with state-owned banks and good credit quality of trade receivables; however, due to continuous losses and operating cash outflows, the company faces significant liquidity risk and has implemented multiple measures to mitigate it - The company primarily operates in China, with most transactions settled in RMB; currently, there is no foreign currency hedging policy, but management monitors foreign exchange risk[215][219] - Interest rate risk primarily arises from fixed-rate borrowings, and management expects interest rate changes to have a minimal impact on interest-bearing assets[217][218][220] - Credit risk is low because cash and cash equivalents are mainly deposited in state-owned banks, and trade receivables are from companies with good credit standing[221][222][223][225] - The company faces significant liquidity risk, recording a net loss of RMB 83.3 million, net operating cash outflow of RMB 69.5 million, and net current liabilities of RMB 79.6 million as of June 30, 2025[229][231] - The company has implemented multiple plans and measures, including seeking bank credit renewal, equity financing, out-licensing pipeline drugs, and expanding cosmetic sales channels, to mitigate liquidity risk[229][231] Interim Condensed Consolidated Statement of Comprehensive Income For the six months ended June 30, 2025, the company recorded revenue of RMB 5,984 thousand, compared to zero in the prior year period; due to increased cost of sales, gross profit turned into a gross loss of RMB 196 thousand; operating loss expanded to RMB 80,828 thousand, ultimately leading to an increase in loss and total comprehensive loss for the period to RMB 83,268 thousand, with basic and diluted loss per share at RMB (0.19) Summary of Interim Condensed Consolidated Statement of Comprehensive Income | Metric | As of June 30, 2025 (RMB thousand) | As of June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Revenue | 5,984 | — | | Cost of Sales | (6,180) | 1,128 | | (Gross Loss)/Gross Profit | (196) | 1,128 | | Other Income | 1,254 | 6,106 | | Marketing Costs | (8,274) | (1,764) | | Administrative Expenses | (25,231) | (33,908) | | R&D Costs | (48,617) | (39,332) | | Operating Loss | (80,828) | (66,260) | | Finance Costs | (2,236) | (5,215) | | Loss Before Income Tax | (83,545) | (71,475) | | Income Tax Credit/(Expense) | 277 | (18) | | Loss and Total Comprehensive Loss for the Period | (83,268) | (71,493) | | Basic and Diluted Loss Per Share (RMB) | (0.19) | (0.17) | - Revenue increased from zero in the prior year period of 2024 to RMB 5,984 thousand in 2025[232] - Gross profit turned into a gross loss of RMB 196 thousand in 2025, from a gross profit of RMB 1,128 thousand in 2024[232] - Loss and total comprehensive loss for the period increased from RMB 71,493 thousand in 2024 to RMB 83,268 thousand in 2025[232] Interim Condensed Consolidated Statement of Financial Position As of June 30, 2025, the company's total assets decreased from RMB 515,126 thousand on December 31, 2024, to RMB 391,895 thousand; current assets significantly declined, resulting in net current liabilities of RMB 79,588 thousand, compared to net current assets of RMB 5,100 thousand at the end of 2024; total liabilities decreased to RMB 175,890 thousand, and total equity decreased to RMB 216,005 thousand Summary of Interim Condensed Consolidated Statement of Financial Position | Metric | As of June 30, 2025 (RMB thousand) | As of December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Total Assets | 391,895 | 515,126 | | Non-Current Assets | 328,545 | 343,396 | | Current Assets | 63,350 | 171,730 | | Total Liabilities | 175,890 | 221,046 | | Non-Current Liabilities | 32,952 | 54,367 | | Current Liabilities | 142,938 | 166,679 | | Total Equity | 216,005 | 294,080 | - Net current assets decreased from RMB 5,100 thousand on December 31, 2024, to net current liabilities of RMB 79,588 thousand on June 30, 2025, primarily due to a reduction in cash and cash equivalents[203][206] - Cash and cash equivalents decreased from RMB 147,419 thousand on December 31, 2024, to RMB 52,862 thousand on June 30, 2025[233] - Total borrowings decreased from RMB 131,763 thousand on December 31, 2024, to RMB 86,983 thousand on June 30, 2025[234] Interim Condensed Consolidated Statement of Changes in Equity For the six months ended June 30, 2025, the company's total equity decreased from RMB 294,080 thousand on January 1, 2025, to RMB 216,005 thousand; key changes include a loss for the period of RMB 83,268 thousand, and adjustments related to share-based payments and vested shares under the employee incentive scheme Summary of Interim Condensed Consolidated Statement of Changes in Equity | Item | As of June 30, 2025 (RMB thousand) | As of June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Total Equity at Beginning of Period | 294,080 | 458,112 | | Loss and Total Comprehensive Loss for the Period | (83,268) | (71,493) | | Share-based Payments | (443) | 4,600 | | Shares Vested and Transferred under Employee Incentive Scheme | 5,636 | 356 | | Total Equity at End of Period | 216,005 | 391,575 | - Loss for the period is the primary factor contributing to the decrease in total equity[235] - Share-based payments were a credit of RMB 443 thousand in 2025, compared to an expense of RMB 4,600 thousand in 2024[235] Interim Condensed Consolidated Statement of Cash Flows For the six months ended June 30, 2025, net cash used in operating activities was RMB 69,521 thousand, an improvement from RMB 110,661 thousand in the prior year period; net cash from investing activities was RMB 14,732 thousand, primarily from the disposal of land use rights; net cash used in financing activities was RMB 40,057 thousand; cash and cash equivalents at period-end decreased to RMB 52,862 thousand Summary of Interim Condensed Consolidated Statement of Cash Flows | Item | As of June 30, 2025 (RMB thousand) | As of June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Net Cash Used in Operating Activities | (69,521) | (110,661) | | Net Cash From/(Used in) Investing Activities | 14,732 | (680) | | Net Cash Used in Financing Activities | (40,057) | (14,881) | | Net Decrease in Cash and Cash Equivalents | (94,846) | (126,222) | | Cash and Cash Equivalents at End of Period | 52,862 | 319,181 | - Net cash used in operating activities primarily includes cash used in operations, interest paid, and income tax paid, partially offset by interest received[193][198] - Net cash from investing activities primarily resulted from proceeds of RMB 15,646 thousand from the disposal of land use rights[196][199] - Net cash used in financing activities primarily included loan repayments of RMB 88,168 thousand, partially offset by loan proceeds of RMB 43,388 thousand and proceeds from shares under the employee incentive scheme of RMB 5,488 thousand[201][205] Notes to the Condensed Consolidated Interim Financial Information GENERAL INFORMATION Kintor Pharmaceutical Limited was incorporated in the Cayman Islands on May 16, 2018, primarily engaged in the R&D of innovative drug products, extending into functional cosmetics; the company's shares have been listed on the Main Board of the Hong Kong Stock Exchange since May 22, 2020 - The company is primarily engaged in the R&D of innovative drug products and has expanded into functional cosmetics[241][244] - The company's shares have been listed on the Main Board of The Stock Exchange of Hong Kong Limited since May 22, 2020[241][245] BASIS OF PREPARATION This condensed consolidated interim financial information is prepared in accordance with International Accounting Standard 34; the company faces significant liquidity uncertainty, having recorded a net loss of RMB 83.3 million, net operating cash outflow of RMB 69.5 million, and net current liabilities of RMB 79.6 million as of June 30, 2025; the Board has considered multiple plans and measures (e.g., bank financing, equity financing, licensing collaborations, expanding cosmetic sales) to ensure the company's continued operation - This condensed consolidated interim financial information has been prepared in accordance with International Accounting Standard 34 "Interim Financial Reporting"[246] - For the six months ended June 30, 2025, the Group incurred a net loss of RMB 83,268,000 and a net operating cash outflow of RMB 69,521,000[247][248] - As of June 30, 2025, the Group had net current liabilities of RMB 79,588,000, indicating a material uncertainty that may cast significant doubt on the Group's ability to continue as a going concern[247][248] - The company has implemented multiple plans and measures, including seeking bank credit renewal, equity financing, out-licensing pipeline drugs, and expanding cosmetic sales channels, to alleviate liquidity pressure and improve its financial position[249][254] ACCOUNTING POLICIES The accounting policies adopted in this condensed financial report are consistent with those applied in the annual financial statements for the year ended December 31, 2024, except for new and amended standards first adopted from January 1, 2025; these new standards have no significant impact on the company's financial performance and position, requiring no retrospective adjustments, and unadopted new standards are also not expected to have a significant impact - The accounting policies adopted in this condensed financial report are consistent with those applied in the annual financial statements for the year ended December 31, 2024[255][257] - New and amended standards first adopted from January 1, 2025 (such as IAS 21 (Amendment) Lack of Exchangeability) have no significant impact on the Group's financial performance and position[255][256][258] - New standards and amendments to standards not yet adopted (such as IFRS 18 and IFRS 19) are not expected to have a significant impact on the Group's consolidated financial statements[259][261][262] CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS The preparation of condensed consolidated interim financial information requires management to make judgments, estimates, and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income, and expenses; the key sources of judgment and estimation uncertainty are the same as those applied in the consolidated financial statements for the year ended December 31, 2024 - Management is required to make judgments, estimates, and assumptions in preparing financial information, and these estimates may differ from actual results[263][267] - The key sources of significant judgment and estimation uncertainty in the application of accounting policies are the same as those applied in the consolidated financial statements for the year ended December 31, 2024[264][267] FINANCIAL RISK MANAGEMENT The company faces market risks (including foreign exchange risk, cash flow and fair value interest rate risk), credit risk, and liquidity risk; there have been no changes in risk management policies since December 31, 2024; the company has no recurring financial assets or liabilities measured at fair value, except for wealth management products and foreign currency options, which are classified as Level 3 in the fair value hierarchy; management believes the carrying amounts of financial assets approximate their fair values - The Group's activities expose it to various financial risks: market risk (including foreign exchange risk, cash flow and fair value interest rate risk), credit risk, and liquidity risk[265][268] - There have been no changes in risk management policies since December 31, 2024[266][269] - The Group has no recurring financial assets or liabilities measured at fair value, except for its wealth management products and foreign currency options, which are measured at fair value through profit or loss and constitute Level 3 of the fair value hierarchy[274][279] - The Group believes that the carrying amounts of its financial assets accounted for at amortized cost in the consolidated financial statements approximate their fair values[281][282] REVENUE FROM CONTRACTS WITH CUSTOMERS For the six months ended June 30, 2025, the company recorded revenue of RMB 5,984 thousand, entirely from cosmetic and functional raw material sales, with no revenue in the prior year period; revenue primarily originated from cosmetic and raw material retail in mainland China, as well as cosmetic retail overseas; Customer A contributed over 10% of total revenue 2025 H1 Revenue from Contracts with Customers Breakdown | Product Line/Region | Mainland China (RMB thousand) | Overseas (RMB thousand) | Total (RMB thousand) | | :--- | :--- | :--- | :--- | | Cosmetic Retail | 2,532 | 1,843 | 4,375 | | Raw Material Retail | 1,609 | — | 1,609 | | Total | 4,141 | 1,843 | 5,984 | - For the six months ended June 30, 2025, the company's revenue was RMB 5,984 thousand, while no revenue was recorded in the corresponding period of 2024[283][284] - Customer A contributed RMB 1,593 thousand to the Group's total revenue, accounting for over 10%[288][289] OTHER INCOME For the six months ended June 30, 2025, the company's other income was RMB 1,254 thousand, a significant decrease from RMB 6,106 thousand in the prior year period; the main reasons were reduced government grants and bank balance interest income Other Income Details | Item | As of June 30, 2025 (RMB thousand) | As of June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Government Grants | 1,113 | 2,604 | | Bank Balance Interest Income | 95 | 3,322 | | Fixed Deposit Interest Income | — | 175 | | Other | 46 | 5 | | Total | 1,254 | 6,106 | - Government grants decreased by RMB 1,491 thousand, and bank balance interest income decreased by RMB 3,227 thousand[291] OPERATING LOSS Operating loss calculation has deducted various expenses, including employee benefits expenses of RMB 33,478 thousand, clinical research expenses of RMB 20,375 thousand, depreciation of property, plant and equipment of RMB 5,982 thousand, and amortization of intangible assets of RMB 5,872 thousand; these expenses reflect the company's investments in R&D and operations Operating Loss Deductions Details | Item | As of June 30, 2025 (RMB thousand) | As of June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Employee Benefits Expenses | 33,478 | 49,465 | | Clinical Research Expenses | 20,375 | (1,777) | | Utilities and Office Expenses | 6,500 | 9,607 | | Depreciation of Property, Plant and Equipment | 5,982 | 6,138 | | Amortization of Intangible Assets | 5,872 | 80 | | Marketing and Promotion Expenses | 4,872 | — | | Outsourced R&D Expenses | 4,619 | 5,033 | | Materials and Consumables Used | 1,037 | 187 | | Depreciation of Right-of-Use Assets | 804 | 2,488 | - Clinical research expenses significantly increased from RMB (1,777) thousand in 2024 to RMB 20,375 thousand in 2025[295] - Amortization of intangible assets significantly increased from RMB 80 thousand in 2024 to RMB 5,872 thousand in 2025[295] OTHER GAINS — NET For the six months ended June 30, 2025, the company recorded other net gains of RMB 236 thousand, a decrease from RMB 1,510 thousand in the prior year period; this was primarily attributable to a reduction in net foreign exchange gains Other Net Gains Details | Item | As of June 30, 2025 (RMB thousand) | As of June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Net Foreign Exchange Gains | 265 | 1,480 | | (Loss)/Gain on Disposal of Property, Plant and Equipment | (9) | 35 | | Gain on Disposal of Right-of-Use Assets | 5 | — | | Other | (25) | (5) | | Total | 236 | 1,510 | - Net foreign exchange gains decreased from RMB 1,480 thousand in 2024 to RMB 265 thousand in 2025[297] FINANCE COSTS For the six months ended June 30, 2025, the company's finance costs were RMB 2,236 thousand, a significant decrease from RMB 5,215 thousand in the prior year period; this was primarily due to reduced interest expenses on bank borrowings Finance Costs Details | Item | As of June 30, 2025 (RMB thousand) | As of June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Interest Expenses on Borrowings | 2,219 | 5,100 | | Interest Expenses on Lease Liabilities | 17 | 115 | | Total | 2,236 | 5,215 | - Interest expenses on borrowings decreased from RMB 5,100 thousand in 2024 to RMB 2,219 thousand in 2025[299] INCOME TAX CREDIT/(EXPENSE) For the six months ended June 30, 2025, the company recorded an income tax credit of RMB 277 thousand, compared to an income tax expense of RMB 18 thousand in the prior year period; this credit was primarily due to a reduction in deferred tax liabilities from the amortization of ongoing R&D for KX-826, partially offset by withholding tax; entities in the Cayman Islands, Hong Kong, the US, Ireland, and mainland China are subject to different tax rates, but most entities did not incur income tax due to the absence of assessable profits Income Tax Credit/(Expense) Details | Item | As of June 30, 2025 (RMB thousand) | As of June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Current Income Tax Expense — Underprovision in Prior Year | (1,178) | (18) | | Deferred Income Tax Credit | 1,455 | — | | Total | 277 | (18) | - The income tax credit was primarily due to a RMB 1,455 thousand reduction in deferred tax liabilities from the amortization of ongoing R&D for KX-826[301] - Mainland China subsidiaries are subject to enterprise income tax at a rate of 25%, but no provision was made due to the absence of assessable profits[310][314] DIVIDEND The Board resolved not to declare an interim dividend for the six months ended June 30, 2025, consistent with the six months ended June 30, 2024 - The Board resolved not to declare any interim dividend for the six months ended June 30, 2025 (six months ended June 30, 2024: nil)[315] LOSS PER SHARE For the six months ended June 30, 2025, the company's basic and diluted loss per share was RMB (0.19), an increase from RMB (0.17) in the prior year period; as a loss was recorded for the period, potential ordinary shares had an anti-dilutive effect, thus diluted loss per share was the same as basic loss per share Loss Per Share Calculation | Metric | As of June 30, 2025 (RMB thousand) | As of June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Loss for the Period | (83,268) | (71,493) | | Weighted Average Number of Issued Ordinary Shares (thousand shares) | 434,071 | 430,425 | | Basic Loss Per Share (RMB) | (0.19) | (0.17) | - As the Group recorded losses for the six months ended June 30, 2025, and 2024, potential ordinary shares had an anti-dilutive effect, thus diluted loss per share was the same as basic loss per share[319][320] PROPERTY, PLANT AND EQUIPMENT, INTANGIBLE ASSETS AND RIGHT-OF-USE ASSETS As of June 30, 2025, the total net book value of property, plant and equipment, intangible assets, and right-of-use assets amounted to RMB 311,430 thousand, a decrease from RMB 323,183 thousand on January 1, 2025; this was primarily due to depreciation and amortization expenses, with a significant increase in intangible asset amortization; certain land use rights, buildings, and construction in progress have been pledged for bank borrowings Changes in Net Book Value of Assets | Item | As of January 1, 2025 (RMB thousand) | As of June 30, 2025 (RMB thousand) | | :--- | :--- | :--- | | Property, Plant and Equipment | 164,645 | 159,647 | | Intangible Assets | 148,949 | 143,077 | | Right-of-Use Assets | 9,589 | 8,706 | | Total | 323,183 | 311,430 | - Total depreciation/amortization expenses amounted to RMB 12,658 thousand, of which intangible asset amortization was RMB 5,872 thousand[322] - As of June 30, 2025, certain land use rights, buildings, and construction in progress have been pledged for the Group's borrowings of RMB 65,000 thousand[324] INVENTORIES As of June 30, 2025, the company's inventories (including raw materials and finished goods) amounted to RMB 2,998 thousand, an increase from RMB 2,215 thousand on December 31, 2024 Inventories Details | Item | As of June 30, 2025 (RMB thousand) | As of December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Raw Materials and Finished Goods | 2,998 | 2,215 | BORROWINGS As of June 30, 2025, the company's total borrowings amounted to RMB 86,983 thousand, a decrease from RMB 131,763 thousand on December 31, 2024; all borrowings are repayable within one year or on demand, including secured and unsecured long-term and short-term bank borrowings at fixed interest rates Borrowings Details | Item | As of June 30, 2025 (RMB thousand) | As of December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Non-Current Long-Term Bank Borrowings | — | 20,000 | | Current Short-Term Bank Borrowings | 41,133 | 14,383 | | Current Long-Term Bank Borrowings | 45,850 | 97,380 | | Total | 86,983 | 131,763 | - As of June 30, 2025, all bank borrowings are repayable within one year or on demand[208][209][333] - Long-term bank borrowings include RMB 30,000 thousand secured (at 4.90% interest) and RMB 15,850 thousand unsecured (at 4.00% to 3.95% interest)[329][331] - Short-term bank borrowings include RMB 35,000 thousand secured and RMB 6,133 thousand unsecured (at 3.60% to 3.50% interest)[330][331] TRADE AND OTHER PAYABLES As of June 30, 2025, the company's total trade and other payables amounted to RMB 55,541 thousand, an increase from RMB 53,111 thousand on December 31, 2024; the primary increase stemmed from amounts payable to service providers; all payables are non-interest-bearing with short maturities, and their fair values approximate their carrying amounts Trade and Other Payables Details | Item | As of June 30, 2025 (RMB thousand) | As of December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Amounts Payable to Service Providers | 47,082 | 39,373 | | Salaries and Employee Benefits Payable | 2,527 | 5,084 | | Payables Arising from Materials and Consumables | 1,931 | 1,583 | | Other | 4,001 | 7,071 | | Total | 55,541 | 53,111 | - Amounts payable to service providers increased from RMB 39,373 thousand on December 31, 2024, to RMB 47,082 thousand on June 30, 2025[335] - As of June 30, 2025, amounts payable to service providers and for materials and consumables exceeding one year totaled RMB 17,550 thousand[339] SHARE CAPITAL On June 15, 2023, the company increased its authorized share capital to USD 70,000, divided into 700,000,000 shares of USD 0.0001 par value each; as of June 30, 2025, the number of issued ordinary shares was 447,499,600, with an equivalent par value of RMB 314,633 thousand - On June 15, 2023, the company increased its authorized share capital to USD 70,000, divided into 700,000,000 shares of USD 0.0001 par value each[341] Share Capital Details | Item | Number of Shares | Par Value of Shares (USD) | Equivalent Par Value of Shares (RMB thousand) | | :--- | :--- | :--- | :--- | | As of January 1, 2025 and June 30, 2025 | 447,499,600 | 44,750 | 314,633 | SHARES HELD FOR THE EMPLOYEE INCENTIVE SCHEME The company has a 2020 Employee Incentive Scheme designed to motivate and retain senior management and employees through the grant of restricted share units or restricted shares; the scheme is administered by the Board or a designated administrator, with multiple tranches of awards granted, some of which have vested, and some canceled and re-granted due to changes in market conditions; as of March 31, 2025, 886,762 Batch A shares and 5,806,926 Batch D shares were vested - The 2020 Employee Incentive Scheme aims to incentivize senior management and employees, funded by the company's existing shares[344][346] - Awards may be granted in the form of restricted share awards or restricted share units under the scheme[346][348] - As of March 31, 2025, a total of 886,762 Batch A shares and 5,806,926 Batch D shares were vested, and the Group received approximately RMB 5,488,000 in total from the grantees[354][355] Changes in Number of Restricted Share Units under 2020 Employee Incentive Scheme | Item | As of June 30, 2025 (Unaudited) | As of June 30, 2024 (Unaudited) | | :--- | :--- | :--- | | Beginning of Period | 13,300,552 | 8,101,790 | | Granted During Period | — | 13,569,064 | | Vested During Period | (6,693,688) | (1,152,176) | | Lapsed During Period | (22,750) | — | | Recovered During Period | (1,448,538) | (1,265,262) | | Cancelled During Period | — | (4,719,064) | | End of Period | 5,135,576 | 14,534,352 | RESERVES As of June 30, 2025, the company's total reserves amounted to RMB 215,697 thousand, a decrease from RMB 293,777 thousand on January 1, 2025; key changes include a loss for the period of RMB 83,268 thousand, and adjustments related to share-based payments and vested shares under the employee incentive scheme Reserves Movement Details | Item | As of January 1, 2025 (RMB thousand) | Loss for the Period (RMB thousand) | Share-based Payments (RMB thousand) | Vested and Transferred Shares (RMB thousand) | As of June 30, 2025 (RMB thousand) | | :--- | :--- | :--- | :--- | :--- | :--- | | Share Premium | 4,210,139 | — | — | 23,280 | 4,233,419 | | Share-based Compensation Reserve | 23,594 | — | (443) | (17,649) | 5,502 | | Accumulated Losses | (3,939,956) | (83,268) | — | — | (4,023,224) | | Total | 293,777 | (83,268) | (443) | 5,631 | 215,697 | - Loss for the period of RMB 83,268 thousand is the primary reason for the decrease in reserves[358] - For the six months ended June 30, 2025, Kiya transferred 6,693,688 ordinary shares of the company to grantees upon vesting of award shares[359] RELATED PARTY TRANSACTIONS This section discloses transactions and balances between the company and related parties; as of June 30, 2025, amounts payable to related parties (related to government grants) have been cleared; total key management personnel compensation decreased from RMB 14,240 thousand in H1 2024 to RMB 5,773 thousand in H1 2025, primarily due to changes in share-based compensation expenses Related Party Balances | Related Party Name | Relationship | As of June 30, 2025 (RMB thousand) | As of December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | :--- | | Dr. Lu Qun | Key Management Personnel until August 30, 2024 | — | 400 | | Dr. Ren Zhihua | Key Management Personnel until February 28, 2025 | — | 159 | | Total | | — | 559 | - As of June 30, 2025, all amounts payable to related parties have been cleared[369] Key Management Personnel Compensation | Item | As of June 30, 2025 (RMB thousand) | As of June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Salaries, Wages and Bonuses | 6,555 | 8,563 | | Contributions to Pension Schemes | 120 | 133 | | Housing Provident Fund, Medical Insurance and Other Social Insurance | 153 | 165 | | Share-based Compensation Expenses | (1,055) | 5,379 | | Total | 5,773 | 14,240 | - Total key management personnel compensation decreased from RMB 14,240 thousand in H1 2024 to RMB 5,773 thousand in H1 2025, primarily due to changes in share-based compensation expenses[372] COMMITMENTS As of June 30, 2025, the company has lease commitments and capital commitments; lease commitments primarily involve offices and equipment with lease terms of less than one year or low value; capital commitments mainly consist of investments in an associate and a joint venture, totaling RMB 513 thousand Lease Commitments | Item | As of June 30, 2025 (RMB thousand) | As of December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Within 1 Year | 120 | 262 | Capital Commitments | Item | As of June 30, 2025 (RMB thousand) | As of December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Investments in an Associate and a Joint Venture | 513 | 513 | SUBSEQUENT EVENTS On August 14, 2025, the company completed a "placing of existing shares and subscription of new shares", issuing 20,673,000 new ordinary shares at HKD 2.08 per share, raising net proceeds of approximately HKD 40,340,000; these funds will be allocated to share capital and share premium, used to supplement working capital - On August 14, 2025, the company issued 20,673,000 new ordinary shares at HKD 2.08 per share, raising net proceeds of approximately HKD 40,340,000[378][379] - Of the net proceeds, RMB 14,748 was credited to share capital, with the remaining amount, after deducting issue expenses, credited to share premium[378][379] Other Information FUTURE AND OUTLOOK The company will continue to deepen pipeline development in dermatology and oncology, particularly advancing clinical trials for KX-826 and GT20029, and expanding the first-mover advantage of topical PROTAC; concurrently, the company will accelerate global market expansion for the high-end cosmetic brand KOSHINÉ, enrich its product portfolio, and enhance brand awareness and market share through multi-channel digital marketing and membership operation strategies; the company also plans to seek external collaborations to accelerate drug commercialization - The company will continue to explore the value of KX-826 and GT20029 in dermatology and advance multiple clinical trials[382][384] - The pivotal Phase III clinical trial of KX-826 topical solution 1.0% for male androgenetic alopecia in China has completed patient enrollment, with completion anticipated in early 2026[383][385] - GT20029 is the world's first topical PROTAC compound to complete Phase II clinical trials; the company will continue to advance its development to further expand its first-mover advantage[386][390] - The company will accelerate the global market expansion of the high-end cosmetic brand KOSHINÉ, enrich its product portfolio, and deepen collaborations with e-commerce platforms such as Tmall, JD.com, Douyin, Xiaohongshu, and Amazon[383][385][391][392] - The company will focus on refined membership management and accumulating high-quality users, enhancing member repurchase rates and revenue contribution through member-exclusive days and regular follow-up communications[392][393] COMPLIANCE WITH THE CG CODE For the six months ended June 30, 2025, the company complied with all applicable provisions of the Corporate Governance Code, except for the combined roles of Chairman and Chief Executive Officer held by Dr. Tong; the Board believes this arrangement ensures consistent leadership and efficient strategic planning, with sufficient checks and balances provided by independent non-executive directors on the Board - The company has complied with all applicable code provisions under the Corporate Governance Code, except for a deviation where the roles of Chairman and Chief Executive Officer are concurrently held by Dr. Tong[394][395][397] - The Board believes that Dr. Tong's dual role ensures consistent leadership within the Group and makes overall strategic planning more effective and efficient[395][397] - Three out of seven directors on the Board are independent non-executive directors, ensuring sufficient checks and balances[395][397] COMPLIANCE WITH MODEL CODE FOR SECURITIES TRANSACTIONS BY DIRECTORS OF LISTED ISSUERS For the six months ended June 30, 2025, and up to the date of approval of this report, all directors confirmed compliance with the Model Code for Securities Transactions by Directors of Listed Issuers; the company also found no instances of non-compliance with the Model Code by relevant employees - All directors confirmed compliance with the Model Code throughout the six months ended June 30, 2025, and up to the date of approval of this report[398][401] - The company found no instances of non-compliance with the Model Code by relevant employees[399][401] DIRECTORS' AND CHIEF EXECUTIVES' INTERESTS AND SHORT POSITIONS IN SHARES AND UNDERLYING SHARES AND DEBENTURES OF THE COMPANY OR ANY OF ITS ASSOCIATED CORPORATIONS As of June 30, 2025, Dr. Tong held a 10.51% share interest in the company through a controlled corporation and beneficially owned 0.56% of shares; Dr. Ni beneficially owned 0.42% of shares; no other directors or chief executives held any disclosable interests or short positions in shares or underlying shares Directors' and Chief Executives' Share Interests | Director Name | Nature of Interest | Number of Ordinary Shares Interested | Approximate Percentage of Company's Issued Shares | | :--- | :--- | :--- | :--- | | Dr. Tong | Interest in Controlled Corporation | 47,050,270 (L) | 10.51% | | Dr. Tong | Beneficial Owner | 2,500,000 (L) | 0.56% | | Dr. Ni | Beneficial Owner | 1,862,500 (L) | 0.42% | - Dr. Tong holds 47,050,270 shares through KT International Investment Limited and beneficially owns 2,500,000 vested and unvested restricted shares[407] - Dr. Ni beneficially owns 931,250 vested and 931,250 unvested restricted shares[407] SUBSTANTIAL SHAREHOLDERS' INTERESTS AND SHORT POSITIONS IN SHARES AND UNDERLYING SHARES As of June 30, 2025, substantial shareholders include KT International Investment Limited (controlled by Dr. Tong, holding 10.51% of shares) and Zhuhai Gree Group Co., Ltd. (holding 5.56% of shares through Zhuhai Gree Financial Investment Management Co., Ltd.) Substantial Shareholders' Share Interests | Name | Nature of Interest | Number of Relevant Shares | Approximate Percentage of Shareholding | | :--- | :--- | :--- | :--- | | KT International Investment Limited | Beneficial Owner | 47,050,270 (L) | 10.51% | | Zhuhai Gree Group Co., Ltd. | Interest in Controlled Corporation | 24,873,500 (L) | 5.56% | | Zhuhai Gree Financial Investment Management Co., Ltd. | Beneficial Owner | 24,873,500 (L) | 5.56% | - KT International Investment Limited is wholly owned by Dr. Tong[411][414] - The ultimate shareholder of Zhuhai Gree Financial Investment Management Co., Ltd. is Zhuhai Gree Group Co., Ltd., which is owned and supervised by the Zhuhai Municipal People's Government State-owned Assets Supervision and Administration Commission[413][414] 2020 EMPLOYEE INCENTIVE SCHEME The 2020 Employee Incentive Scheme was approved by the Board on March 31, 2020, aiming to incentiviz