日本共生(00627) - 2025 - 中期财报

Company Information Board of Directors and Committee Composition The Board of Directors comprises an Executive Director (CEO), a Non-executive Director, and three Independent Non-executive Directors, with independent directors chairing key committees - Board members include Executive Director Dr. Kaneko Hiroshi (CEO), Non-executive Director Mr. Zhong Haowei, and three independent non-executive directors Mr. Huang Zhongquan, Ms. Deng Yingxin, and Ms. Xia Shiyun[3] - The Audit Committee, Remuneration Committee, and Nomination Committee are all chaired by independent non-executive directors[3] Company Contact and Listing Information The Company Secretary is Mr. Tsang King Sum, and the auditor is Da Xin Liang Xue Lian (Hong Kong) CPA Limited. The Company's ordinary shares are listed on The Stock Exchange of Hong Kong Limited under stock code 627 - The Company Secretary is Mr. Tsang King Sum, and the authorized representatives are Dr. Kaneko Hiroshi and Mr. Tsang King Sum[3] - The auditor is Da Xin Liang Xue Lian (Hong Kong) CPA Limited, and the legal advisor is M.C.M. Solicitors[3] - The Company's ordinary shares are listed on The Stock Exchange of Hong Kong Limited, with stock code 627, and the Company's website is www.jkgc.com.hk[4](index=4&type=chunk) Definitions Key Term Definitions This section provides definitions for key terms used in the report, including Board, the Company, the Group, Hong Kong, HKD, Listing Rules, Model Code, Period, China, Prior Period, Target Properties, Purchaser, Remaining Properties, RMB, Sale Shares, SFO, Shares, Stock Exchange, and USD - "Period/During the Period" refers to January 1, 2025, to June 30, 2025[5] - "Prior Period" refers to January 1, 2024, to June 30, 2024[5] - "Target Properties" refers to certain vacant and residential properties located in Kosuge, Narita City, Tokyo, Japan, with an area of approximately 51,591.36 square meters[5] Management Discussion and Analysis Overall Review The Group's principal businesses remain property development and property investment, with strategic expansion into the supply chain sector. Property sales revenue significantly decreased by 95.0% during the period, while the supply chain business contributed RMB 30,000 thousand in revenue, and operating expenses and finance costs substantially reduced - The Group's principal businesses are concentrated in property development and property investment, with expansion into the supply chain sector within China[7] Property Sales Revenue Comparison | Indicator | H1 2025 (RMB) | H1 2024 (RMB) | YoY Change | | :--- | :--- | :--- | :--- | | Property Sales Revenue | 3,024,000 | 60,295,000 | -95.0% | Rental Income Comparison | Indicator | H1 2025 (RMB) | H1 2024 (RMB) | | :--- | :--- | :--- | | Rental Income | 169,000 | 417,000 | - The supply chain business contributed revenue of approximately RMB 30,000 thousand during the period[10] Operating Expenses Comparison | Indicator | H1 2025 (RMB) | H1 2024 (RMB) | | :--- | :--- | :--- | | Selling and Distribution Expenses | 652,000 | 2,760,000 | | Administrative Expenses | 7,180,000 | 18,271,000 | Finance Costs Comparison | Indicator | H1 2025 (RMB) | H1 2024 (RMB) | | :--- | :--- | :--- | | Finance Costs | 9,384,000 | 185,365,000 | Income Tax Expense Comparison | Indicator | H1 2025 (RMB) | H1 2024 (RMB) | | :--- | :--- | :--- | | Income Tax Expense/(Credit) | 35,000 | (20,409,000) | Outlook and Strategy Facing continued uncertainty in China's property market, the Group will expand its geographical footprint to high-potential markets such as Guangzhou, Shenzhen, Japan, and Australia, and strategically diversify its business portfolio by accelerating investments in modern logistics warehousing, distribution centers, and data centers to meet the growing demands of e-commerce and the digital economy - China's property market continues to face uncertainty, with a highly volatile operating environment, making 2025 an extremely challenging year for the Group[14] - The Group will expand its geographical footprint, actively seizing quality development opportunities in major cities like Guangzhou and Shenzhen, while exploring high-potential Asian markets, including Japan and Australia[14] - Strategically enriching its business portfolio, the Group will accelerate investments in modern logistics warehousing, distribution centers, and data centers to respond to demand growth driven by e-commerce, cloud computing, and economic digitalization[14] Financial Position and Risks The Board resolved not to declare an interim dividend for the period. As of June 30, 2025, the Group's bank balances and cash were approximately RMB 3,480 thousand, total borrowings were approximately RMB 194,691 thousand, and the net gearing ratio was 10.51%. The Group faces foreign exchange fluctuation risks but has not entered into hedging instruments - The Board resolved not to declare an interim dividend for the period (Prior Period: nil)[15] Liquidity and Borrowings | Indicator | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Bank Balances and Cash | 3,480 | 3,922 | | Total Other Borrowings | 194,691 | 193,860 | | Net Gearing Ratio | 10.51% | 10.48% | Current Assets and Liabilities | Indicator | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Current Assets | 3,514,484 | 3,494,570 | | Current Liabilities | 5,338,679 | 5,312,324 | | Net Liabilities | 1,813,480 | 1,806,734 | - The Group faces foreign exchange fluctuation risks in RMB, USD, and HKD, but considers the potential foreign exchange risk limited and has therefore not entered into hedging instruments[18] - As of January 1, 2025, and June 30, 2025, the number of issued shares remained 1,420,673,262 shares[20] - The Group had no material acquisitions or investments during the period, nor any significant events after the reporting period[21][22] Corporate Governance and Other Information Employees and Remuneration Policy As of June 30, 2025, the Group had approximately 106 employees. Employee remuneration is determined by reference to market benchmarks, with discretionary year-end bonuses based on individual performance. The Group provides a state-managed retirement benefit scheme for mainland China employees and a Mandatory Provident Fund Scheme for Hong Kong employees - As of June 30, 2025, the Group had approximately 106 employees, including directors[23] - Employee remuneration is determined by reference to market benchmarks, with discretionary year-end bonuses based on individual performance[23] - Mainland China employees are members of a state-managed retirement benefit scheme, and Hong Kong employees are members of a Mandatory Provident Fund Scheme[23] Central Pension Scheme Applicable Percentages | Pension Insurance | 12.0-20.0% | | :--- | :--- | | Medical Insurance | 5.2-10.5% | | Unemployment Insurance | 0.32-1.5% | | Housing Provident Fund | 5.0-12.0% | Directors' and Major Shareholders' Interests Executive Director Dr. Kaneko Hiroshi holds a 30% interest in the associated corporation Grateful Heart Inc. Major shareholder Mr. Yanase Kenichi holds approximately 69.97% of the Company's issued share capital through controlled corporations such as Advance Investment Limited and Grateful Heart Inc Directors' Interests in Ordinary Shares of Associated Corporations | Name of Director/Chief Executive | Name of Associated Corporation | Capacity/Nature of Interest | Number of Shares Held | Approximate Percentage of Equity Interest in Associated Corporation | | :--- | :--- | :--- | :--- | :--- | | Dr. Kaneko Hiroshi | Grateful Heart Inc. | Beneficial Owner | 3(L) | 30% | Major Shareholders' Interests in the Company's Securities | Name | Capacity | Total | Approximate Percentage of the Company's Issued Share Capital | | :--- | :--- | :--- | :--- | | Mr. Yanase Kenichi | Interest in controlled corporation | 994,019,402(L) | 69.97% | | Grateful Heart Inc. | Interest in controlled corporation | 994,019,402(L) | 69.97% | | Sun Hung Kai Investment Services Limited | Investment Manager | 994,019,402(L) | 69.97% | | Sun Hung Kai Funds Open-ended Fund Company - Sun Hung Kai Opportunity Fund No. 1 | Interest in controlled corporation | 994,019,402(L) | 69.97% | | Advance Investment Limited | Beneficial Owner | 994,019,402(L) | 69.97% | - Mr. Yanase Kenichi is deemed to have an interest in the same number of shares held by Grateful Heart Inc. as he owns 70% interest in Grateful Heart Inc.[29] Share Option Scheme and Corporate Governance The Company has a share option scheme, but no share options were granted, exercised, cancelled, or lapsed during the period. The Audit Committee is responsible for reviewing financial reporting, risk management, and internal controls. The Company has complied with the Corporate Governance Code, although the roles of Chairman and CEO are held by the same person, but the Board believes there are sufficient safeguards to ensure a balance of power - The total number of share options available for grant under the share option scheme is 11,236,749, but no unexercised share options existed during the period or as of the reporting date[31] - The Audit Committee, comprising three independent non-executive directors, is responsible for examining, reviewing, and overseeing the financial reporting process, risk management, and internal control systems[32] - The Company has complied with the Corporate Governance Code set out in Appendix C1 of the Listing Rules, except that the roles of Chairman and Chief Executive Officer are held by the same person, Executive Director and CEO Dr. Kaneko Hiroshi[33][34] - The Board believes that there are sufficient safeguards to ensure a balance of power, as all major decisions are made after consultation among Board members, and three independent non-executive directors provide independent perspectives[34] - During the period, all directors complied with the Model Code for Securities Transactions by Directors of Listed Issuers set out in Appendix C3 of the Listing Rules[35] - For the six months ended June 30, 2025, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[37] Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income Overview of Profit or Loss and Comprehensive Income For the six months ended June 30, 2025, the Group's total revenue was RMB 33,193 thousand, a significant decrease from RMB 60,712 thousand in the prior year. The loss for the period narrowed significantly to RMB 13,432 thousand, compared to a loss of RMB 312,012 thousand in the prior year, primarily due to substantial reductions in cost of sales, impairment losses, and finance costs Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (RMB thousand) | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Revenue | 33,193 | 60,712 | | Cost of Sales | (32,325) | (124,493) | | Gross Profit/(Loss) | 868 | (63,781) | | Other Income | 33 | 274 | | Net Other Gains and Losses | 3,220 | (6,279) | | Selling and Distribution Expenses | (652) | (2,760) | | Administrative Expenses | (7,180) | (18,271) | | Impairment Losses | – | (51,889) | | Finance Costs | (9,384) | (185,365) | | Loss Before Tax | (13,397) | (332,421) | | Income Tax Expense/(Credit) | (35) | 20,409 | | Loss for the Period | (13,432) | (312,012) | | Exchange Differences on Translation of Foreign Operations | 6,686 | (5,188) | | Total Comprehensive Expense for the Period | (6,746) | (317,200) | | Basic Loss Per Share (RMB cents) | (0.90) | (21.29) | - The loss for the period significantly narrowed, primarily due to substantial reductions in cost of sales, impairment losses, and finance costs[39] - Exchange differences on translation of foreign operations turned from a loss to a gain, positively impacting total comprehensive income[39] Condensed Consolidated Statement of Financial Position Overview of Assets, Liabilities, and Equity As of June 30, 2025, the Group's total assets were RMB 3,532,535 thousand, and total liabilities were RMB 5,346,015 thousand, resulting in a total deficit of RMB 1,813,480 thousand. Net current liabilities were approximately RMB 1,824,195 thousand, indicating persistent liquidity pressure Condensed Consolidated Statement of Financial Position (RMB thousand) | Indicator | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Non-current Assets | | | | Property, Plant and Equipment | 287 | 290 | | Interests in an Associate | 9,939 | 10,241 | | Investment Properties | 7,100 | 7,100 | | Deferred Tax Assets | 225 | 225 | | Current Assets | | | | Properties Under Development/Held for Sale | 382,405 | 384,662 | | Trade and Other Receivables and Prepayments | 3,094,055 | 3,071,647 | | Bank Balances and Cash | 3,480 | 3,922 | | Current Liabilities | | | | Trade and Other Payables and Accruals | 4,921,496 | 4,898,797 | | Borrowings - Due within One Year | 194,691 | 193,860 | | Net Current Liabilities | (1,824,195) | (1,817,754) | | Capital and Reserves | | | | Share Capital | 12,924 | 12,924 | | Reserves | (1,892,261) | (1,886,221) | | Total Deficit | (1,813,480) | (1,806,734) | - The Group's net current liabilities as of June 30, 2025, were approximately RMB 1,824,195 thousand, a slight increase from RMB 1,817,754 thousand as of December 31, 2024, indicating persistent liquidity pressure[41] - The deficit attributable to owners of the Company further expanded to RMB 1,879,337 thousand[42] Condensed Consolidated Statement of Changes in Equity Analysis of Changes in Equity For the six months ended June 30, 2025, the deficit attributable to owners of the Company increased from RMB 1,873,297 thousand at the beginning of the period to RMB 1,879,337 thousand. Total comprehensive expense for the period was RMB 6,746 thousand, primarily influenced by the loss for the period and exchange gains Condensed Consolidated Statement of Changes in Equity (RMB thousand) | Indicator | June 30, 2025 (Unaudited) | January 1, 2024 (Audited) | | :--- | :--- | :--- | | Share Capital | 12,924 | 12,924 | | Share Premium | 227,657 | 227,657 | | Exchange Reserve | 89,440 | 90,859 | | Accumulated Losses | (3,246,224) | (2,431,232) | | Total Deficit Attributable to Owners of the Company | (1,879,337) | (1,013,302) | | Non-controlling Interests | 65,857 | 300,524 | | Total Deficit | (1,813,480) | (712,778) | | Loss for the Period (Attributable to Owners of the Company) | (12,726) | (302,399) | | Other Comprehensive Income for the Period (Attributable to Owners of the Company) | 6,686 | (5,188) | | Total Comprehensive Expense for the Period (Attributable to Owners of the Company) | (6,040) | (307,587) | - Accumulated losses attributable to owners of the Company increased from approximately RMB 2,431,232 thousand as of January 1, 2024, to approximately RMB 3,246,224 thousand as of June 30, 2025[44] - The exchange reserve turned from a loss as of June 30, 2024, to a gain as of June 30, 2025, reflecting the impact of foreign currency exchange rate changes[44] Condensed Consolidated Statement of Cash Flows Cash Flow Analysis For the six months ended June 30, 2025, the Group's net cash used in operating activities was RMB 1,325 thousand, net cash from investing activities was RMB 7 thousand, and net cash from financing activities was RMB 889 thousand. Cash and cash equivalents at the end of the period decreased from the beginning of the period Condensed Consolidated Statement of Cash Flows (RMB thousand) | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Net Cash (Used in)/From Operating Activities | (1,325) | 5,063 | | Net Cash From Investing Activities | 7 | 144 | | Net Cash From Financing Activities | 889 | 666 | | Net (Decrease)/Increase in Cash and Cash Equivalents | (429) | 5,873 | | Cash and Cash Equivalents at Beginning of Period | 3,922 | 44,011 | | Cash and Cash Equivalents at End of Period | 3,480 | 50,493 | - Cash flow from operating activities turned from a net inflow in the prior year to a net outflow, primarily due to changes in working capital[46] - Cash and cash equivalents at the end of the period were RMB 3,480 thousand, a decrease from RMB 3,922 thousand at the beginning of the period[46] Notes to the Condensed Consolidated Financial Statements 1. Basis of Preparation This condensed consolidated interim financial information is prepared in accordance with HKAS 34 and on a going concern basis. However, the Group faces significant uncertainties including continuous losses, current liabilities exceeding current assets, and loan defaults, with its going concern ability dependent on management's plans to improve liquidity - This condensed consolidated interim financial information is prepared in accordance with Hong Kong Accounting Standard 34 Interim Financial Reporting[47] - For the period ended June 30, 2025, the Group recorded a net loss of approximately RMB 13.4 million, a total deficit of approximately RMB 1.8793 billion, and current liabilities exceeding current assets by approximately RMB 1.8242 billion[48] - The Group was unable to repay borrowings totaling approximately RMB 151.5 million and related accrued interest of approximately RMB 37.1 million by their scheduled repayment dates, resulting in defaulted borrowings of approximately RMB 188.6 million becoming immediately repayable[48] - The effectiveness of the going concern basis depends on management's plans to improve liquidity, including generating operating cash flows, successfully negotiating new loans/loan renewals, and controlling administrative costs[49] 2. Significant Accounting Policies The condensed consolidated financial information is prepared on a historical cost basis, except for investment properties and certain financial assets measured at fair value through other comprehensive income. HKAS 21 (Revised) "The Effects of Changes in Foreign Exchange Rates – Lack of Exchangeability" was first applied in this interim period but had no significant impact on financial position and performance - The condensed consolidated financial information is prepared on a historical cost basis, except for investment properties and certain financial assets measured at fair value through other comprehensive income[50] - HKAS 21 (Revised) "The Effects of Changes in Foreign Exchange Rates – Lack of Exchangeability" was first applied in this interim period but had no significant impact on the Group's financial position and performance[51] 3. Revenue The Group's total revenue for H1 2025 was RMB 33,193 thousand, primarily from the supply chain business (RMB 30,000 thousand) and property development (RMB 3,024 thousand). Property sales revenue significantly decreased by 95.0% year-on-year, while the supply chain business is a new revenue source Revenue from Contracts with Customers (RMB thousand) | Type of Goods | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Sales of Completed Properties | 3,024 | 60,295 | | Sales of Goods | 30,000 | – | | Geographical Market: People's Republic of China | 33,024 | 60,295 | | Timing of Revenue Recognition: At a point in time | 33,024 | 60,295 | Total Revenue by Segment (RMB thousand) | Segment | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Property Development | 3,024 | 60,295 | | Property Investment | 169 | 417 | | Supply Chain Business | 30,000 | – | | Total Revenue | 33,193 | 60,712 | - Property sales revenue significantly decreased from RMB 60,295 thousand in H1 2024 to RMB 3,024 thousand in H1 2025[53] - The supply chain business is a new revenue source in H1 2025, contributing RMB 30,000 thousand[53][54] 4. Segment Information The Group's operations are divided into three reportable segments: property development, property investment, and supply chain business. In H1 2025, the supply chain business contributed most of the segment revenue and profit, while the property development segment continued to record a loss. Segment assets and liabilities are primarily concentrated in property development Revenue and Results by Reportable Segment (H1 2025, RMB thousand) | Segment | Segment Revenue (External) | Segment Profit/(Loss) | | :--- | :--- | :--- | | Property Development | 3,024 | (2,277) | | Property Investment | 169 | 129 | | Supply Chain Business | 30,000 | 141 | | Total Segments | 33,193 | (2,007) | Assets by Reportable Segment (RMB thousand) | Segment | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Property Development | 1,008,939 | 1,011,323 | | Property Investment | 7,119 | 7,113 | | Supply Chain Business | 30,000 | – | | Total Segments | 1,046,058 | 1,018,436 | Liabilities by Reportable Segment (RMB thousand) | Segment | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Property Development | 1,229,251 | 1,231,563 | | Property Investment | 167 | 167 | | Supply Chain Business | 29,894 | – | | Total Segments | 1,259,312 | 1,231,730 | - The supply chain business became a significant contributor to revenue and profit in H1 2025, while the property development segment remained in a loss-making state[55] 5. Impairment Losses For the six months ended June 30, 2025, the Group recorded no impairment losses, a significant improvement from the RMB 51,889 thousand impairment loss in the prior year, which primarily stemmed from amounts due from a former subsidiary and non-controlling interests Impairment Losses (RMB thousand) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Amounts Due from a Former Subsidiary | – | 31,489 | | Amounts Due from Non-controlling Interests | – | 20,400 | | Total | – | 51,889 | - No impairment losses were recorded in the current period, representing a significant improvement compared to the prior year[59] 6. Other Income, Gains and Losses For the six months ended June 30, 2025, the Group's other income was RMB 33 thousand, mainly from bank interest income. Net other gains and losses amounted to RMB 3,220 thousand, primarily net exchange gains, a significant improvement from the exchange losses in the prior year Other Income (RMB thousand) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Rental Income from Short-term Leases of Completed Properties Held for Sale | – | 116 | | Bank Interest Income | 7 | 108 | | Others | 26 | 50 | | Total | 33 | 274 | Net Other Gains and Losses (RMB thousand) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Gain on Disposal of Property, Plant and Equipment | – | 14 | | Net Exchange Gains/(Losses) | 3,220 | (6,293) | | Total | 3,220 | (6,279) | - Net exchange gains of RMB 3,220 thousand in the current period, compared to a loss of RMB 6,293 thousand in the prior year, positively impacted overall gains[60] 7. Finance Costs For the six months ended June 30, 2025, the Group's finance costs were RMB 9,384 thousand, a significant decrease from RMB 185,365 thousand in the prior year, primarily due to a substantial reduction in interest on bank and other borrowings Finance Costs (RMB thousand) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Interest on Bank and Other Borrowings | 9,384 | 180,798 | | Interest on Contract Liabilities | – | 4,567 | | Total | 9,384 | 185,365 | - Finance costs decreased significantly by 94.9%, primarily due to a substantial reduction in interest on bank and other borrowings[61] 8. Income Tax Expense/(Credit) For the six months ended June 30, 2025, the Group recorded an income tax expense of RMB 35 thousand, compared to an income tax credit of RMB 20,409 thousand in the prior year, mainly due to the recognition of an over-provision for land appreciation tax last year. Chinese subsidiaries are subject to a 25% corporate income tax rate Income Tax Expense/(Credit) (RMB thousand) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | China Corporate Income Tax | 35 | 2,497 | | Land Appreciation Tax | – | (22,821) | | Deferred Tax Credit | – | (85) | | Total | 35 | (20,409) | - The prior year's income tax credit was primarily due to the recognition of an over-provision for land appreciation tax from the previous year[13][62] - Chinese subsidiaries are subject to a corporate income tax rate of 25%[63] 9. Loss for the Period For the six months ended June 30, 2025, the Group's loss for the period was RMB 13,432 thousand, primarily after deducting items such as cost of sales, administrative expenses, and finance costs. Total staff costs (excluding directors' emoluments) amounted to RMB 3,080 thousand Key Components of Loss for the Period (RMB thousand) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Cost of Properties Held for Sale Included in Cost of Sales | 2,605 | 124,471 | | Cost of Goods Sold Included in Cost of Sales | 29,700 | – | | Impairment Loss on Properties Under Development/Held for Sale Included in Cost of Sales | – | 58,425 | | Depreciation of Property, Plant and Equipment | 4 | 997 | | Staff Salaries and Allowances | 2,882 | 7,427 | | Retirement Benefit Scheme Contributions | 198 | 554 | | Total Staff Costs (Excluding Directors' Emoluments) | 3,080 | 7,981 | - Cost of goods sold is a new item in H1 2025, reflecting the commencement of the supply chain business[64] - Impairment loss on properties held for sale was zero in the current period, compared to RMB 58,425 thousand in the prior year[64] 10. Dividends For the six months ended June 30, 2025, and 2024, the Company neither paid nor proposed any dividends to shareholders - For the six months ended June 30, 2025, and 2024, no dividends were paid or proposed to the Company's shareholders[65] 11. Loss Per Share For the six months ended June 30, 2025, both basic and diluted loss per share attributable to owners of the Company were RMB 0.90 cents, a significant narrowing from RMB 21.29 cents in the prior year. No dilutive potential ordinary shares were issued during the period Loss Per Share (RMB cents) | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Basic Loss Per Share | (0.90) | (21.29) | | Diluted Loss Per Share | (0.90) | (21.29) | - The loss for the period attributable to owners of the Company for basic loss per share was RMB 12,726 thousand (H1 2024: RMB 302,399 thousand)[66] - Diluted loss per share was equal to basic loss per share for the six months ended June 30, 2025, and 2024, as no dilutive potential ordinary shares were issued during the period[66] 12. Interests in an Associate As of June 30, 2025, the Group's interest in an associate, measured at its share of net assets, was RMB 9,939 thousand, a slight decrease from RMB 10,241 thousand as of December 31, 2024 Interests in an Associate (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Share of Net Assets | 9,939 | 10,241 | 13. Interests in a Joint Venture As of June 30, 2025, the Group's interest in a joint venture was zero, as the investment cost was offset by the share of post-acquisition results Interests in a Joint Venture (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Investment Cost, Unlisted | 1,275 | 1,275 | | Share of Post-acquisition Results | (1,275) | (1,275) | | Total | – | – | 14. Investment Properties As of June 30, 2025, the Group's investment properties were accounted for at fair value of RMB 7,100 thousand, consistent with December 31, 2024. All investment properties are located in China Investment Properties (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Accounted for at Fair Value | 7,100 | 7,100 | - All of the Group's investment properties are located in China and are measured using the fair value model[69][70] 15. Properties Under Development/Held for Sale As of June 30, 2025, the Group's total properties under development/held for sale amounted to RMB 382,405 thousand, a slight decrease from RMB 384,662 thousand as of December 31, 2024 Properties Under Development/Held for Sale (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Properties Under Development | 122,660 | 122,660 | | Properties Held for Sale | 259,745 | 262,002 | | Total | 382,405 | 384,662 | 16. Trade and Other Receivables and Prepayments As of June 30, 2025, the Group's total trade and other receivables and prepayments amounted to RMB 3,094,055 thousand, primarily including amounts due from a former subsidiary of RMB 3,040,547 thousand and trade receivables from customer contracts of RMB 30,000 thousand. All trade receivables from customer contracts have an aging of 0 to 90 days Trade and Other Receivables and Prepayments (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Trade and Other Receivables and Prepayments | 3,086,957 | 3,064,427 | | Prepaid Income Tax | 34,012 | 33,807 | | Total | 3,094,055 | 3,071,647 | - Trade receivables from customer contracts amounted to approximately RMB 30,000 thousand (2024: nil), all with an aging of 0 to 90 days[72][74] - Other receivables and prepayments include amounts due from a former subsidiary of approximately RMB 3,040,547 thousand, which are unsecured, interest-free, and repayable on demand[72] 17. Trade and Other Payables and Accruals As of June 30, 2025, the Group's total trade and other payables and accruals amounted to RMB 4,921,496 thousand, primarily including amounts due to a former subsidiary of RMB 3,123,068 thousand, provision for financial guarantees of RMB 599,775 thousand, and interest payable of RMB 50,662 thousand. Trade payables to suppliers mainly have an aging of 0 to 60 days Trade and Other Payables and Accruals (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Trade and Other Payables and Accruals | 3,679,990 | 3,661,098 | | Interest Payable | 50,662 | 41,285 | | Provision for Financial Guarantees | 599,775 | 599,775 | | Total | 4,921,496 | 4,898,797 | - Trade payables to suppliers amounted to approximately RMB 29,743 thousand (2024: RMB 43 thousand), of which RMB 29,700 thousand had an aging of 0 to 60 days[75][78] - Other payables and accruals include amounts due to a former subsidiary of RMB 3,123,068 thousand, which are unsecured, interest-free, and repayable on demand[75] 18. Borrowings As of June 30, 2025, the Group's total other borrowings amounted to RMB 194,691 thousand, all due within one year or repayable on demand. During the period, new borrowings of RMB 889 thousand were raised, and no borrowings were repaid Borrowings (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Other Loans | 194,691 | 193,860 | | Due Immediately or on Demand or within One Year | 194,691 | 193,860 | - For the six months ended June 30, 2025, the Group raised new borrowings of approximately RMB 889 thousand and repaid no borrowings[79] - All borrowings are due within one year or repayable on demand, indicating high short-term repayment pressure[79] 19. Share Capital As of June 30, 2025, the Company's authorized share capital was 50,000,000,000 shares with a par value of HKD 0.01 each, equivalent to RMB 423,381 thousand. The issued and fully paid share capital was 1,420,673,262 shares, equivalent to RMB 12,924 thousand, consistent with December 31, 2024 Share Capital (RMB thousand) | Item | Number of Shares | Amount (HKD thousand) | Equivalent Amount (RMB thousand) | | :--- | :--- | :--- | :--- | | Authorized Share Capital | 50,000,000,000 | 500,000 | 423,381 | | Issued and Fully Paid Share Capital | 1,420,673,262 | 14,207 | 12,924 | - The number of issued shares remained unchanged at 1,420,673,262 as of December 31, 2024, and June 30, 2025[81] 20. Disposal of a Subsidiary On May 21, 2024, the Group completed the disposal of its equity interest in Hunan Asia-Pacific Meilifang Investment Property Co., Ltd. for a consideration of approximately RMB 500 thousand, recording a disposal loss of approximately RMB 4,315 thousand. This disposal resulted in a net cash inflow of RMB 459 thousand - The Group disposed of its equity interest in Hunan Asia-Pacific Meilifang Investment Property Co., Ltd. on May 21, 2024, for a consideration of approximately RMB 500 thousand[82] - A loss on disposal of approximately RMB 4,315 thousand was recorded[82][83] Net Cash Inflow from Disposal of Hunan Asia-Pacific (RMB thousand) | Item | Amount | | :--- | :--- | | Cash Consideration | 500 | | Less: Bank Balances and Cash Derecognized | (41) | | Net Cash Inflow | 459 | 21. Pledged Assets As of June 30, 2025, the Group's properties under development and properties held for sale totaling RMB 295,441 thousand were pledged as collateral for bank and other financing, as well as customer mortgage loans. Additionally, certain shares of the Group's subsidiaries were also pledged Pledged Assets (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Properties Under Development | 122,660 | 122,660 | | Properties Held for Sale | 172,781 | 172,781 | | Total | 295,441 | 295,441 | - The aforementioned assets were pledged as collateral for certain bank and other financing obtained by the Group, as well as mortgage loans granted to the Group's customers[84] - Certain shares of the Group's subsidiaries were also pledged for certain borrowings obtained by the Group[85] 22. Other Commitments As of June 30, 2025, the Group's property development commitments contracted but not provided for in the condensed consolidated financial information amounted to RMB 1,373 thousand, consistent with December 31, 2024 Other Commitments (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Commitments for Property Development Contracted but Not Provided for in the Condensed Consolidated Financial Information | 1,373 | 1,373 | 23. Related Party Balances and Transactions The Group's related parties include controlling shareholder Mr. Yanase Kenichi and companies controlled by him, as well as former controlling shareholder Mr. Pan Haoran and companies related to his family. For the six months ended June 30, 2025, total key management personnel emoluments amounted to RMB 1,668 thousand. No significant balances or transactions with related parties occurred during the period - Related parties include the current controlling shareholder Mr. Yanase Kenichi and his controlled company Kyosei Bank Co., Ltd., as well as the former ultimate controlling shareholder Mr. Pan Haoran and companies related to his family[87] Key Management Personnel Emoluments (RMB thousand) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Salaries and Allowances | 1,533 | 1,914 | | Performance-related Bonuses | 114 | 170 | | Retirement Benefit Scheme Contributions | 21 | 22 | | Total | 1,668 | 2,106 | - For the six months ended June 30, 2025, and 2024, the Group did not enter into any significant transactions with its related parties[89] 24. Fair Value Measurement of Financial Instruments The Group designated equity instruments measured at fair value through other comprehensive income as RMB 500 thousand, classified as Level 3 fair value measurement, using a discounted cash flow valuation technique. The directors believe that the carrying amounts of financial assets and financial liabilities approximate their fair values Fair Value Measurement of Financial Instruments (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | Fair Value Hierarchy Level | Valuation Techniques and Key Inputs | | :--- | :--- | :--- | :--- | :--- | | Equity Instruments Designated at Fair Value Through Other Comprehensive Income | 500 | 500 | Level 3 | Discounted cash flow—future cash flows are estimated based on expected returns and contractual investment costs, and discounted at internal rates of return reflecting different property projects. | - The directors believe that the carrying amounts of financial assets and financial liabilities recognized in the condensed consolidated financial statements approximate their fair values[93] - A significant unobservable input is the discount rate; an increase in the discount rate would result in a decrease in fair value, and vice versa[98] 25. Litigation The Group is involved in various legal proceedings arising in the ordinary course of business. Provisions are made for potential losses when the outcome of litigation can be reliably estimated; no provisions are made if the outcome cannot be reliably estimated or if an outflow of resources is not probable - The Group is involved in various legal proceedings and other legal actions arising in the ordinary course of business[95] - Provisions for potential losses are made when management can reliably estimate the outcome of litigation; no provisions are made if the outcome cannot be reliably estimated or if an outflow of resources is not probable[95] 26. Events After the Reporting Period The Group had no significant events after the reporting date and up to the date of these condensed consolidated financial statements - The Group had no significant events after the reporting date and up to the date of these condensed consolidated financial statements[96]