飞扬集团(01901) - 2025 - 中期财报

Company Information This section provides fundamental details about the company's governance structure, key personnel, and essential administrative contacts Board of Directors and Committees This section details the composition of the Board of Directors and its committees, including key appointments and resignations - Mr. Li Jieming was appointed Co-Chief Executive Officer on August 29, 2025[5] - Mr. Shen Yang resigned as Non-executive Director on August 29, 2025[5] - The composition of the Audit, Remuneration, and Nomination Committees, including their chairpersons and members, is clearly defined[5] Company Contact and Audit Information This section provides essential contact and administrative details, including headquarters, auditor, and stock information - The company's headquarters and principal place of business in China are located in Ningbo, Zhejiang Province, with its principal place of business in Hong Kong on Queen's Road Central[6] - The independent auditor is Zhongzheng Tianheng Certified Public Accountants Limited[6] - The company's stock code is 1901, and its website is http://www.iflying.com[6](index=6&type=chunk) Financial Highlights This section presents a concise overview of the company's key financial performance indicators for the reporting period Overview of Financial Performance The company achieved year-on-year revenue and gross profit growth, successfully turning a net loss into a profit for the period Financial Summary for the Six Months Ended June 30 | Metric | 2025 (RMB'000) | 2024 (RMB'000) | | :--- | :--- | :--- | | Revenue | 511,201 | 420,970 | | Gross Profit | 27,310 | 25,016 | | Profit/(Loss) for the Period | 6,161 | (16,323) | - Net profit for the current period was RMB6.2 million, compared to a net loss of RMB16.3 million in the prior period, achieving a turnaround to profitability[7] - Revenue for the current period increased by RMB90.2 million or 21.4% compared to the prior period, primarily due to increased sales of travel-related products and services[8] - Gross profit for the current period increased by RMB2.3 million or 9.2% compared to the prior period, driven by the increase in revenue[8] Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income This section provides a detailed breakdown of the company's revenues, expenses, and overall profitability for the reporting period Overview of Profit or Loss and Comprehensive Income The company reported a profit of RMB6,161 thousand for the period, a significant improvement from the prior year's loss, with basic earnings per share of 0.80 RMB cents Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (For the Six Months Ended June 30) | Metric | 2025 (RMB'000) | 2024 (RMB'000) | | :--- | :--- | :--- | | Revenue | 511,201 | 420,970 | | Cost of Sales | (483,891) | (395,954) | | Gross Profit | 27,310 | 25,016 | | Other Income and Gains | 27,688 | 19,029 | | Selling and Distribution Expenses | (14,667) | (12,042) | | Administrative Expenses | (12,979) | (24,142) | | Net Impairment Losses on Financial Assets | (7,780) | (17,968) | | Other Expenses | (8,718) | (1,038) | | Finance Costs | (4,631) | (4,995) | | Profit/(Loss) Before Income Tax | 6,169 | (16,340) | | Income Tax (Expense)/Credit | (8) | 17 | | Profit/(Loss) for the Period | 6,161 | (16,323) | | Total Comprehensive Income/(Loss) for the Period | 5,333 | (5,162) | Profit/(Loss) for the Period Attributable to Owners of the Company and Earnings Per Share | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Profit/(Loss) for the Period Attributable to Owners of the Company (RMB'000) | 6,627 | (14,848) | | Basic Earnings/(Loss) Per Share (RMB cents) | 0.80 | (1.78) | - Administrative expenses significantly decreased from RMB24,142 thousand to RMB12,979 thousand[9] - Net impairment losses on financial assets decreased from RMB17,968 thousand to RMB7,780 thousand[9] Condensed Consolidated Statement of Financial Position This section outlines the company's assets, liabilities, and equity at the end of the reporting period Overview of Assets and Liabilities The Group's net current assets turned positive, total net assets increased, and trade receivables and payables saw significant changes Condensed Consolidated Statement of Financial Position (As at June 30, 2025) | Metric | June 30, 2025 (RMB'000) | December 31, 2024 (RMB'000) | | :--- | :--- | :--- | | Non-current Assets | 49,062 | 68,841 | | Current Assets | 480,642 | 337,437 | | Current Liabilities | 472,515 | 350,525 | | Net Current Assets/(Liabilities) | 8,127 | (13,088) | | Net Assets | 53,581 | 51,052 | | Total Equity | 53,581 | 51,052 | - Net current assets improved from negative RMB13,088 thousand as of December 31, 2024, to RMB8,127 thousand as of June 30, 2025, indicating improved liquidity[11] - Trade receivables increased from RMB88,648 thousand to RMB133,619 thousand, and prepayments, deposits, and other receivables increased from RMB195,648 thousand to RMB263,220 thousand[11] - Trade payables significantly increased from RMB33,816 thousand to RMB119,686 thousand[11] Condensed Consolidated Statement of Changes in Equity This section details the movements in the company's equity components over the reporting period Overview of Equity Changes Equity attributable to owners increased from RMB58,636 thousand to RMB64,851 thousand, driven by profit and share-based payments, partially offset by disposals Condensed Consolidated Statement of Changes in Equity (For the Six Months Ended June 30) | Equity Item | January 1, 2025 (RMB'000) | Profit/(Loss) for the Period (RMB'000) | Other Comprehensive Loss for the Period (RMB'000) | Disposal of a Subsidiary (RMB'000) | Equity-settled Share-based Payments Recognized (RMB'000) | June 30, 2025 (RMB'000) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Equity Attributable to Owners of the Company | 58,636 | 6,627 | (798) | – | 386 | 64,851 | | Non-controlling Interests | (7,584) | (466) | (30) | (3,190) | – | (11,270) | | Total Equity | 51,052 | 6,161 | (828) | (3,190) | 386 | 53,581 | - Accumulated losses attributable to owners of the company decreased from RMB(286,811) thousand as of January 1, 2025, to RMB(280,184) thousand as of June 30, 2025, reflecting the profit for the period[12] - Non-controlling interests decreased by RMB3,190 thousand due to the disposal of a subsidiary[12] Condensed Consolidated Statement of Cash Flows This section presents an overview of the company's cash inflows and outflows from operating, investing, and financing activities Overview of Cash Flows The Group's cash and cash equivalents increased by RMB39,194 thousand, reaching RMB70,505 thousand at period-end, with positive cash flows from investing and financing activities Condensed Consolidated Statement of Cash Flows (For the Six Months Ended June 30) | Metric | 2025 (RMB'000) | 2024 (RMB'000) | | :--- | :--- | :--- | | Net Cash Flows Used in Operating Activities | (42,654) | (11,842) | | Net Cash Flows From Investing Activities | 43,152 | 5,338 | | Net Cash Flows From Financing Activities | 38,696 | 35,782 | | Net Increase in Cash and Cash Equivalents | 39,194 | 29,278 | | Cash and Cash Equivalents at End of Period | 70,505 | 86,653 | - Net cash flows used in operating activities expanded from RMB(11,842) thousand in the prior period to RMB(42,654) thousand in the current period[13] - Net cash flows from investing activities significantly increased from RMB5,338 thousand to RMB43,152 thousand[13] - Net cash flows from financing activities showed stable growth, increasing from RMB35,782 thousand to RMB38,696 thousand[13] Notes to the Condensed Consolidated Interim Financial Statements This section provides detailed explanations and disclosures supporting the condensed consolidated interim financial statements 1. Company Information This section outlines the company's registration, principal business locations, diverse business scope, and ultimate controlling shareholders - The Company was incorporated in the Cayman Islands on October 18, 2018, and its shares were listed on the Main Board of the Hong Kong Stock Exchange on June 28, 2019[14][15] - Principal businesses include outbound package tours, free-and-easy travel products, travel support services, health products, and information system development products and services[14] - The ultimate controlling shareholders are Mr. He Binfeng and his spouse, Ms. Qian Jie[14] 2. Basis of Preparation and Presentation The interim financial statements are prepared under HKAS 34 and Listing Rules, presented in RMB, and affirm the going concern basis despite liquidity pressures - The financial statements are prepared in accordance with HKAS 34 and Appendix D2 of the Listing Rules, presented in RMB[16] - Despite interest-bearing bank and other borrowings of approximately RMB245,183 thousand being classified as current liabilities, the Board believes the Group can operate on a going concern basis for at least twelve months through active negotiation for renewal and cost control measures[17][20] 3. Changes in Accounting Policies and Disclosures Accounting policies remain consistent with annual statements, with the first-time adoption of HKAS 21 (Amendment) 'Lack of Exchangeability' having no material impact - Accounting policies are consistent with the 2024 annual financial statements, with only the first-time adoption of HKAS 21 (Amendment) 'Lack of Exchangeability'[18][19] - As the Group's transaction and functional currencies are convertible, this amendment has no impact on the condensed consolidated financial statements[19] 4. Operating Segment Information The Group operates in Mainland China and Hong Kong, with revenue primarily from Mainland China, and decreased Hong Kong revenue and non-current assets - The Group primarily operates in Mainland China and Hong Kong, but executive directors review overall financial performance without separate operating segments[21][22] Revenue from External Customers and Non-current Assets by Geographical Location | Region | External Customer Revenue 2025 (RMB'000) | External Customer Revenue 2024 (RMB'000) | Non-current Assets 2025 (RMB'000) | Non-current Assets 2024 (RMB'000) | | :--- | :--- | :--- | :--- | :--- | | Mainland China | 511,201 | 409,721 | 16,614 | 19,733 | | Hong Kong | – | 11,249 | 8,893 | 30,918 | | Total | 511,201 | 420,970 | 25,507 | 50,651 | - External customer revenue from Hong Kong was zero for the current period, and non-current assets also significantly decreased[24] - No sales revenue from a single customer reached 10% or more of the Group's total revenue[25] 5. Revenue, Other Income and Gains Total revenue reached RMB511,201 thousand, mainly from customer contracts, while other income and gains increased to RMB27,688 thousand due to asset disposals and miscellaneous income Analysis of Revenue and Other Income and Gains (For the Six Months Ended June 30) | Item | 2025 (RMB'000) | 2024 (RMB'000) | | :--- | :--- | :--- | | Revenue from Contracts with Customers | 511,201 | 420,872 | | Total Revenue | 511,201 | 420,970 | | Total Other Income | 13,812 | 19,029 | | Gain on Disposal of Property, Plant and Equipment | 13,876 | – | | Total Other Income and Gains | 27,688 | 19,029 | Revenue from Contracts with Customers by Major Product Line (For the Six Months Ended June 30) | Product Line | 2025 (RMB'000) | 2024 (RMB'000) | | :--- | :--- | :--- | | Package Tour Sales — Domestic | 190,108 | 130,526 | | Gross Revenue from Free-and-Easy Travel Product Sales | 316,394 | 273,648 | | Health Product Sales | – | 10,122 | | Total | 511,201 | 420,872 | - Gain on disposal of property, plant and equipment amounted to RMB13,876 thousand in the current period, compared to zero in the prior period[27] - Compensation income decreased from RMB15,120 thousand in the prior period to RMB7,560 thousand in the current period[27][28] - Miscellaneous income increased to RMB5,945 thousand due to a Chinese court ruling in favor of the Group and the refund of funds[27][28] 6. Finance Costs The Group's finance costs, comprising interest on borrowings and lease liabilities, saw a slight decrease in the current period Finance Costs (For the Six Months Ended June 30) | Item | 2025 (RMB'000) | 2024 (RMB'000) | | :--- | :--- | :--- | | Interest on Bank and Other Borrowings | 4,514 | 4,787 | | Interest on Lease Liabilities | 117 | 208 | | Total | 4,631 | 4,995 | - Total finance costs slightly decreased from RMB4,995 thousand in the prior period to RMB4,631 thousand in the current period[29] 7. Profit/(Loss) Before Income Tax Profit before income tax improved to RMB6,169 thousand, driven by reduced depreciation and impairment losses, despite a loss from subsidiary disposal Components of Profit/(Loss) Before Income Tax (For the Six Months Ended June 30) | Item | 2025 (RMB'000) | 2024 (RMB'000) | | :--- | :--- | :--- | | Cost of Services Provided | 386,283 | 387,182 | | Depreciation of Property, Plant and Equipment | 701 | 6,034 | | Depreciation of Right-of-Use Assets | 1,146 | 3,079 | | Loss on Disposal of a Subsidiary | 4,785 | – | | Impairment Recognized on Financial Assets Included in Prepayments, Deposits and Other Receivables | 7,580 | 17,949 | | Staff Costs | 17,049 | 17,663 | - Depreciation of property, plant and equipment significantly decreased from RMB6,034 thousand to RMB701 thousand[30] - Impairment recognized on financial assets included in prepayments, deposits and other receivables decreased from RMB17,949 thousand to RMB7,580 thousand[30] - A loss of RMB4,785 thousand was incurred from the disposal of a subsidiary during the current period[30] 8. Income Tax (Expense)/Credit Income tax expense was RMB8 thousand, a shift from the prior period's credit, with Chinese subsidiaries benefiting from preferential tax rates Analysis of Income Tax (Expense)/Credit (For the Six Months Ended June 30) | Item | 2025 (RMB'000) | 2024 (RMB'000) | | :--- | :--- | :--- | | PRC Enterprise Income Tax (Under)/Over-provision in Prior Years | (8) | 17 | - Chinese subsidiaries are subject to a statutory tax rate of 25% and enjoy preferential income tax rates for small and micro-enterprises (first RMB1.0 million eligible for 75% deduction, income between RMB1.0 million and RMB3.0 million eligible for 50% deduction)[31] - No assessable profits were generated in Hong Kong during the current period, thus no income tax provision was made[31] 9. Earnings/(Loss) Per Share Basic earnings per share improved to 0.80 RMB cents, a significant turnaround from the prior year's loss, with no diluted earnings per share presented due to anti-dilutive share options Calculation of Basic Earnings/(Loss) Per Share (For the Six Months Ended June 30) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Profit/(Loss) for the Period Attributable to Owners of the Company (RMB'000) | 6,627 | (14,848) | | Weighted Average Number of Ordinary Shares in Issue (thousand shares) | 832,000 | 832,000 | | Basic Earnings/(Loss) Per Share (RMB cents) | 0.80 | (1.78) | - Diluted earnings per share was not presented for the six months ended June 30, 2025, as the effect of exercising the share options granted by the Company was anti-dilutive[35] 10. Interim Dividend The Board does not recommend an interim dividend for the six months ended June 30, 2025, consistent with the prior period - The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025[36] 11. Property, Plant and Equipment Acquisitions of property, plant and equipment were minor, while disposals significantly increased for the six months ended June 30, 2025 - Acquisitions of property, plant and equipment amounted to approximately RMB47 thousand in the current period, compared to RMB731 thousand in the prior period[37] - Disposals of property, plant and equipment amounted to approximately RMB21,253 thousand in the current period, compared to zero in the prior period[37] 12. Investments in Associates The Group received RMB56,000 thousand from divesting its investment in Ningbo Yinjiang Feiyang Culture and Tourism Development Co., Ltd - The Group divested its investment in associate Ningbo Yinjiang Feiyang Culture and Tourism Development Co., Ltd, receiving RMB56,000 thousand[38] 13. Trade Receivables Total trade receivables increased to RMB200,156 thousand, with a notable portion aged over 180 days, while impairment provisions slightly decreased Total Trade Receivables and Impairment Losses (As at Period-end) | Metric | June 30, 2025 (RMB'000) | December 31, 2024 (RMB'000) | | :--- | :--- | :--- | | Gross Trade Receivables | 200,156 | 155,796 | | Less: Impairment Losses Recognized | (66,537) | (67,148) | | Net | 133,619 | 88,648 | Ageing Analysis of Trade Receivables (As at Period-end) | Ageing | June 30, 2025 (RMB'000) | December 31, 2024 (RMB'000) | | :--- | :--- | :--- | | 1 to 60 days | 72,985 | 67,448 | | 181 to 360 days | 54,577 | 17,070 | | Over 2 years | 69,704 | 65,145 | - The credit period for trade receivables generally does not exceed two months, with some customers extending up to one year[39] - Impairment loss provision for trade receivables slightly decreased from RMB67,148 thousand at the beginning of the period to RMB66,537 thousand at the end of the period[41] 14. Prepayments, Deposits and Other Receivables Total prepayments, deposits, and other receivables increased to RMB286,775 thousand, while recognized impairment losses decreased to RMB117,412 thousand Prepayments, Deposits and Other Receivables (As at Period-end) | Metric | June 30, 2025 (RMB'000) | December 31, 2024 (RMB'000) | | :--- | :--- | :--- | | Prepayments | 159,297 | 125,735 | | Deposits and Other Receivables | 244,890 | 224,757 | | Less: Impairment Losses Recognized | (117,412) | (136,820) | | Total | 286,775 | 213,672 | - Impairment losses recognized decreased from RMB136,820 thousand at the beginning of the period to RMB117,412 thousand at the end, primarily due to a reduction in impairment provisions from the disposal of a subsidiary[43] 15. Trade Payables Total trade payables significantly increased to RMB119,686 thousand, with most due within 60 days, and are non-interest-bearing Ageing Analysis of Trade Payables (As at Period-end) | Ageing | June 30, 2025 (RMB'000) | December 31, 2024 (RMB'000) | | :--- | :--- | :--- | | 1 to 60 days | 114,489 | 19,198 | | Total | 119,686 | 33,816 | - Total trade payables significantly increased from RMB33,816 thousand as of December 31, 2024, to RMB119,686 thousand as of June 30, 2025[44] 16. Interest-bearing Bank and Other Borrowings Total interest-bearing borrowings increased to RMB245,183 thousand, all secured and current, with guarantees from controlling shareholders and certain directors Interest-bearing Bank and Other Borrowings (As at Period-end) | Item | June 30, 2025 (RMB'000) | December 31, 2024 (RMB'000) | | :--- | :--- | :--- | | Bank Loans — Secured | 245,183 | 197,460 | - All bank and other borrowings are current, repayable on demand or within one year[45] - Controlling shareholders jointly guaranteed bank facilities of up to RMB256,410 thousand for the Group[45] - Mr. Zhang Dayi and Ms. Zhang Xiaoshan, directors of certain PRC subsidiaries, jointly guaranteed bank facilities of up to RMB10,000 thousand for the Group, a decrease from RMB49,000 thousand in the prior period[45] 17. Share Capital Issued and fully paid share capital remained unchanged at RMB7,145 thousand, comprising 832,000,000 ordinary shares of HKD0.01 each Share Capital Information (As at Period-end) | Item | June 30, 2025 (RMB'000) | December 31, 2024 (RMB'000) | | :--- | :--- | :--- | | Issued and Fully Paid Share Capital | 7,145 | 7,145 | | Number of Shares | 832,000,000 shares | 832,000,000 shares | 18. Fair Value and Fair Value Hierarchy of Financial Instruments Fair value measurements of financial instruments include Level 1 listed equity securities and Level 2 unlisted fund investments, with no financial liabilities measured at fair value or Level 3 transfers Fair Value Hierarchy of Financial Instruments (As at June 30, 2025) | Item | Level 1 (RMB'000) | Level 2 (RMB'000) | Level 3 (RMB'000) | Total (RMB'000) | | :--- | :--- | :--- | :--- | :--- | | Listed Equity Securities | 3 | – | – | 3 | | Unlisted Fund Investments | – | 337 | – | 337 | - As of June 30, 2025, the Group had no financial liabilities measured at fair value[49] - There were no transfers into or out of Level 3 for the six months ended June 30, 2025[50] 19. Commitments Capital commitments totaled RMB53,734 thousand, primarily for investment projects and alcoholic beverages, showing a slight decrease from the prior year-end Capital Commitments (As at Period-end) | Item | June 30, 2025 (RMB'000) | December 31, 2024 (RMB'000) | | :--- | :--- | :--- | | Acquisition of Investment Projects | 45,037 | 45,732 | | Alcoholic Beverages | 6,840 | 6,945 | 20. Disposal of a Subsidiary The Group disposed of a 60% equity interest in Zhejiang Feijiada Aviation Services Co., Ltd. for RMB22,680 thousand, resulting in a RMB4,785 thousand loss and RMB1,321 thousand net cash outflow - The Group completed the disposal of a 60% equity interest in Zhejiang Feijiada Aviation Services Co., Ltd. on April 2, 2025, for a consideration of RMB22,680 thousand[52][107] - The disposal of the subsidiary resulted in a recognized loss of RMB4,785 thousand[53] - The net cash outflow from the disposal of the subsidiary was RMB1,321 thousand[54] 21. Related Party Transactions The Group has related party transactions, with amounts due from related parties totaling RMB8,442 thousand, and increased key management personnel compensation Outstanding Balances with Related Parties (As at Period-end) | Item | June 30, 2025 (RMB'000) | December 31, 2024 (RMB'000) | | :--- | :--- | :--- | | Amount Due from a Director | 3,310 | 3,310 | | Amounts Due from Related Parties (Total) | 8,442 | 8,490 | Key Management Personnel Compensation (For the Six Months Ended June 30) | Item | 2025 (RMB'000) | 2024 (RMB'000) | | :--- | :--- | :--- | | Salaries, Allowances and Benefits in Kind | 518 | 467 | | Equity-settled Share-based Payments | 70 | – | | Total Compensation | 597 | 482 | - Balances with related parties are non-trade in nature, unsecured, interest-free, and repayable on demand[56] 22. Events After the Reporting Period Post-reporting period, the company adopted a new share option scheme, granted 83,200,000 share options, and completed a placement of 166,400,000 shares, raising HKD33.4 million - A new share option scheme was adopted on July 14, 2025[59] - On July 25, 2025, 83,200,000 share options were granted to 10 eligible persons[59] - On July 29, 2025, the Company placed a total of 166,400,000 shares to placees at approximately HKD0.201 per share, with issuance completed on August 25, 2025[59] 23. Approval of Condensed Consolidated Interim Financial Statements The unaudited condensed consolidated interim financial statements were approved and authorized for issue by the Board on August 26, 2025 - The condensed consolidated interim financial statements were approved and authorized for issue by the Board of Directors on August 26, 2025[58] Management Discussion and Analysis This section provides management's perspective on the Group's operational and financial performance, along with future outlook Business Review The Group, a tourism service provider in Ningbo, saw strong revenue growth and a return to profitability driven by the recovery of domestic and international tourism markets - The Group primarily engages in the design, development, and sale of package tours, free-and-easy travel products, travel support services, information system development services, health product sales, and finance lease services[60] - In 2024, China's domestic tourism reached 5.615 billion person-times, with total tourist consumption of RMB5.75 trillion, and international tourism recovered to 99% of pre-pandemic levels[60][61] - Gross revenue from free-and-easy travel product sales significantly increased to RMB316.4 million, and package tour sales increased to RMB190.1 million[61] - The current period recorded a net profit of RMB6.2 million (prior period: net loss of RMB16.3 million), primarily due to increased gross profit from travel-related products and services sales, reduced administrative expenses related to the metaverse platform, and decreased impairment losses on financial assets[61] Prospects The Group targets the silver economy and inbound tourism, positioning itself as 'China's No. 1 Brand for Middle-aged and Elderly Tourism Services' by leveraging AI and overseas live streaming - China's elderly tourism market has immense potential, with the silver tourism market value projected to increase from RMB1.4 trillion in 2023 to RMB2.7 trillion in 2028[62] - The Group is positioned as 'China's No. 1 Brand for Middle-aged and Elderly Tourism Services', leveraging AI technology to develop senior tourism[63] - With the Chinese government expanding visa-free entry, the Group will utilize overseas live streaming channels to vigorously expand 'Overseas Chinese Travel' and 'Global Muslim Inbound Travel to China'[63] Financial Review The Group's financial performance significantly improved with revenue and gross profit growth, a return to profitability, controlled expenses, and improved liquidity, though net debt and gearing ratio warrant attention Revenue Total revenue grew 21.4% to RMB511.2 million, driven by increased demand for travel-related products, with significant growth in package tours and free-and-easy travel sales Revenue Breakdown by Business Segment (For the Six Months Ended June 30) | Business Segment | 2025 Revenue (RMB'000) | 2025 % of Revenue | 2024 Revenue (RMB'000) | 2024 % of Revenue | | :--- | :--- | :--- | :--- | :--- | | Package Tour Sales | 190,108 | 37.2 | 130,526 | 31.0 | | Gross Revenue from Free-and-Easy Travel Product Sales | 316,394 | 61.9 | 273,648 | 65.0 | | Travel Support Products and Services Sales | 2,915 | 0.5 | 2,325 | 0.6 | | Information System Development Services | 868 | 0.2 | 797 | 0.2 | | Health Product Sales | – | – | 10,122 | 2.4 | | Finance Lease Income | – | – | 98 | – | | Total | 511,201 | 100.0 | 420,970 | 100.0 | - The Group's revenue increased by RMB90.2 million from RMB421.0 million in the prior period to RMB511.2 million in the current period, primarily due to increased demand for package tours and free-and-easy travel products[65] - Package tour sales increased by 45.6% to RMB190.1 million, and gross revenue from free-and-easy travel product sales increased by 15.6% to RMB316.4 million[67][68] - Health product sales and finance lease income were both zero in the current period due to resource allocation towards travel-related products and services[72][73] Cost of Sales Cost of sales increased by 22.2% to RMB483.9 million, primarily driven by higher costs associated with increased demand for free-and-easy travel products - Cost of sales increased by RMB87.9 million or 22.2% from RMB396.0 million in the prior period to RMB483.9 million in the current period[74] - This was primarily due to increased costs from free-and-easy travel product sales, driven by higher demand for products offered by the Group as principal[74] Gross Profit and Gross Profit Margin Gross profit increased to RMB27.3 million, but the overall gross profit margin decreased from 5.9% to 5.3% due to product mix changes and increased tour discounts Gross Profit and Gross Profit Margin Breakdown by Business Segment (For the Six Months Ended June 30) | Business Segment | 2025 Gross Profit (RMB'000) | 2025 Gross Profit Margin (%) | 2024 Gross Profit/(Loss) (RMB'000) | 2024 Gross Profit/(Loss) Margin (%) | | :--- | :--- | :--- | :--- | :--- | | Package Tours — Traditional | 21,530 | 11.8 | 17,321 | 14.4 | | Package Tours — Customized | 708 | 8.8 | 944 | 9.3 | | Gross Revenue from Free-and-Easy Travel Product Sales | 2,771 | 0.9 | (329) | (0.1) | | Marginal Revenue from Free-and-Easy Travel Product Sales | 916 | 100.0 | 3,395 | 98.3 | | Travel Support Products and Services | 1,343 | 46.1 | 1,462 | 62.9 | | Information System Development Services | 42 | 4.8 | 775 | 97.2 | | Health Product Sales | – | – | 1,350 | 13.3 | | Total | 27,310 | 5.3 | 25,016 | 5.9 | - Overall gross profit margin decreased from 5.9% in the prior period to 5.3% in the current period, primarily due to changes in product and service mix and increased discounts offered for package tours to attract customers[76] - Gross profit from free-and-easy travel product sales turned positive, increasing from RMB(329) thousand to RMB2,771 thousand[75] Other Income and Gains Total other income and gains increased to RMB27.7 million, driven by asset disposal gains and supplier refunds, despite reduced compensation income - Other income and gains increased by RMB8.7 million from RMB19.0 million in the prior period to RMB27.7 million in the current period[77] - Gain on disposal of property, plant and equipment increased by RMB13.9 million[77] - Supplier refunds related to contract disputes increased by RMB4.2 million to RMB5.3 million[77] - Compensation income decreased by RMB7.6 million to RMB7.6 million due to failure to meet net profit requirements[77] Selling and Distribution Expenses Selling and distribution expenses increased by 21.8% to RMB14.7 million, mainly due to higher staff costs from expanding the core service network - Selling and distribution expenses increased by RMB2.6 million or 21.8% from RMB12.0 million in the prior period to RMB14.7 million in the current period[78] - This was primarily due to an increase in staff costs of RMB1.9 million resulting from an expanded workforce to extend the core service network[78] Administrative Expenses Administrative expenses significantly decreased by 46.2% to RMB12.979 million, driven by reduced depreciation from asset disposals, lower staff numbers, and decreased rental expenses - Administrative expenses decreased by RMB11.2 million or 46.2% to RMB12,979 thousand in the current period[79] - This was primarily due to a RMB5.5 million reduction in depreciation following the disposal of property, plant and equipment related to the metaverse platform and cloud storage services[79] - A reduction in staff related to the metaverse platform led to a RMB2.5 million decrease in staff costs[79] Finance Costs Finance costs slightly decreased from RMB5.0 million in the prior period to RMB4.6 million in the current period - Finance costs slightly decreased from RMB5.0 million in the prior period to RMB4.6 million in the current period[80] Other Expenses Other expenses significantly increased to RMB8.7 million, primarily due to a RMB4.8 million loss recognized from the disposal of a subsidiary - Other expenses significantly increased from RMB1.0 million in