Corporate Information Board of Directors and Committees The company's board comprises executive and independent non-executive directors, with changes in independent non-executive directors and committee chairs during the period, promptly adjusted to comply with listing rules - Independent Non-Executive Directors Ms. Hu Jingying and Mr. Mo Fan resigned on February 14, 202546 - Ms. Jiao Jie was appointed Independent Non-Executive Director on February 14, 2025, and Ms. Wang Tingdan on May 13, 202546 - The Audit Committee Chair changed from Ms. Hu Jingying to Mr. Chen Guanfa, and the Remuneration Committee Chair from Ms. Hu Jingying to Ms. Wang Tingdan567 Auditor and Legal Advisers The company's auditor changed from Deloitte Touche Tohmatsu to BDO Limited, with key legal advisers and bankers also listed - Deloitte Touche Tohmatsu retired as the company's auditor on June 16, 2025911 - BDO Limited was appointed as the company's auditor on June 16, 2025911 Registered and Principal Offices The company's registered office is in the Cayman Islands, with principal offices in Hong Kong and Shenzhen, China Securities Information The company's shares are listed on the Hong Kong Stock Exchange under stock code 95, with a board lot size of 2,000 shares - The company's stock code on the Hong Kong Stock Exchange is 9513 - The board lot size is 2,000 shares13 Management Discussion and Analysis Industry Review In H1 2025, China's economy grew by 5.3% amid challenges, with easing real estate policies and active Greater Bay Area development - In H1 2025, China's GDP grew by 5.3% year-on-year at constant prices1517 - Real estate policies continued to ease, with the PBoC lowering the 5-year LPR to 3.5% and first-time provident fund loan rates to a record low of 2.6%1618 - National real estate development investment decreased by 11.2% year-on-year, with new commercial housing sales area down 3.5% and sales value down 5.5%, showing narrowed declines2729 - The Greater Bay Area's 9 mainland cities recorded RMB 4.38 trillion in total imports and exports, a 4.3% year-on-year increase, surpassing Guangdong and national averages2830 Overall Performance In H1 2025, the Group focused on urban renewal and debt restructuring, experiencing revenue and profit declines but improved gross margin and expanded losses, with no dividend proposed - The Group focused on urban renewal, with strong sales for the Baishizhou project, solidifying its leading position in the Greater Bay Area core market3236 - The Group actively pursued debt restructuring and strengthened cash flow management to ensure operational continuity and project control3437 Key Financial Indicators for H1 2025 | Indicator | H1 2025 (RMB million) | H1 2024 (RMB million) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 1,039.7 | 1,942.8 | -46.5% | | Gross Profit | 376.3 | 437.7 | -14.0% | | Loss Attributable to Equity Holders | (1,837.9) | (1,528.2) | +20.3% | | Basic Loss Per Share (RMB cents) | (31.25) | (29.98) | +4.2% | | Gross Profit Margin (%) | 36% | 23% | +13 percentage points | | Bank Balances and Cash (at period-end) | 1,961.7 | 3,303.8 (Dec 31, 2024) | -40.6% | | Average Financing Cost (%) | 7.9% | 8.0% | -0.1 percentage points | | Gearing Ratio (%) | 78.6% | 76.9% (Dec 31, 2024) | +1.7 percentage points | | Return on Capital (%) | (11.24%) | (28.67%) | +17.43 percentage points | - The Board does not recommend the payment of any dividend for the six months ended June 30, 202545 Business Review In H1 2025, Lvgem China pursued a strategy of focusing on urban renewal and asset management, with significant declines in property development revenue but stable commercial property and comprehensive services performance - The Group adhered to its 2025 development strategy: focusing on five quality projects, strengthening asset management and profitability, and deepening urban renewal efforts48 - The Group sold its hotel property in California, USA, recouping USD 20 million in cash, optimizing its asset structure and easing financial pressure616667 - Fair value adjustments to investment properties resulted in a book loss, which is non-cash and does not impact actual operating cash flow or asset stability6568 - As of June 30, 2025, the Group's land bank was approximately 6.3 million square meters, with nearly 80% located in core areas of Greater Bay Area cities7073 Real Estate Development and Sales Real estate development remains the Group's core business, with H1 2025 revenue down 62.0% and contracted sales down 80.3%, primarily from key Greater Bay Area projects Real Estate Development and Sales Performance | Indicator | H1 2025 (RMB million) | H1 2024 (RMB million) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 527.5 | 1,389.2 | -62.0% | | Contracted Sales Amount | 1,057.6 | 5,389.7 | -80.3% | | GFA of Properties Recognized for Sale (0.1 million sq.m.) | 1.86 | 2.85 | -34.7% | - Baishizhou Project Phase I is topped out, with curtain wall construction nearly 70% complete and interior decoration 60% complete, expected for delivery in January 2026; Phase II is planned for full commencement in 20265558 - The Baishizhou project maintains a strong market position in the luxury housing segment due to its prime location, high-standard planning, and smart technology amenities7274 Commercial Property Investment and Operations The Group deepened its 'Zuo Lin' and 'NEO' dual-brand strategy, with H1 2025 commercial property revenue down 9.0% to RMB 311.8 million, but core project occupancy remained high at 72% Commercial Property Investment and Operations Performance | Indicator | H1 2025 (RMB million) | H1 2024 (RMB million) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 311.8 | 342.7 | -9.0% | | Investment Property Occupancy Rate | 72% | 78% | -6 percentage points | | Hong Kong Lvgem NEO Tower Occupancy Rate | 68% | 73% | -5 percentage points | - The Group holds over 30 commercial property projects with a total GFA exceeding 1.6 million square meters7678 Comprehensive Services The Group provides property management, hotel operations, and value-added services, with H1 2025 comprehensive services revenue down 5.0% to RMB 200.4 million, strengthening non-development business resilience Comprehensive Services Performance | Indicator | H1 2025 (RMB million) | H1 2024 (RMB million) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 200.4 | 210.9 | -5.0% | - Shenzhen Lvgem Jinjiang Hotel achieved an average occupancy rate of over 68%7779 Future Outlook H2 2025 real estate market is expected to stabilize with policy support, urban renewal offering new opportunities; Lvgem China will focus on project delivery, debt restructuring, and accelerated sales to address liquidity and achieve stable growth - In H2, governments are expected to fully implement policies, with high-quality projects driving stable new home markets in core cities8284 - Urban renewal is a key driver for high-quality development, with central and regulatory support expected to unleash investment and domestic demand potential8385 - The Group will focus on the construction progress of five key projects, especially Baishizhou, ensuring timely completion of engineering milestones8992 - The Group will actively advance the overall offshore debt restructuring process, aiming to reconfigure debt structure, extend repayment schedules, and reduce financial pressure9092 - The Group will continue to strengthen product and sales capabilities, accelerate project destocking, and improve cash recovery efficiency9598 Financial Review In H1 2025, total revenue decreased by 46.5% to RMB 1,039.7 million, driven by reduced property sales; gross profit declined but margin improved to 36%, with a net loss of RMB 2,029.8 million and increased gearing to 136.8% amid liquidity challenges H1 2025 Revenue Composition | Business Segment | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | Change (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Real Estate Development and Sales | 527,497 | 1,389,244 | (861,747) | -62.0% | | Commercial Property Investment and Operations | 311,827 | 342,708 | (30,881) | -9.0% | | Comprehensive Services | 200,367 | 210,871 | (10,504) | -5.0% | | Total | 1,039,691 | 1,942,823 | (903,132) | -46.5% | H1 2025 Income Statement Key Data | Indicator | H1 2025 (RMB million) | H1 2024 (RMB million) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 1,039.7 | 1,942.8 | -46.5% | | Gross Profit | 376.3 | 437.7 | -14.0% | | Fair Value Change of Investment Properties | (1,070.1) | (951.7) | +12.4% | | Finance Costs | (682.6) | (833.5) | -18.1% | | Income Tax Credit (Expense) | 145.4 | (9.9) | N/A | | Loss for the Period | (2,029.8) | (1,610.4) | +26.0% | | Loss Attributable to Equity Holders | (1,837.9) | (1,528.2) | +20.3% | | Basic Loss Per Share (RMB cents) | (31.25) | (29.98) | +4.2% | H1 2025 Balance Sheet and Liquidity | Indicator | June 30, 2025 (RMB million) | December 31, 2024 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Bank Balances and Cash | 1,961.7 | 3,303.8 | -40.6% | | Total Borrowings | 32,185.5 | 33,578.7 | -4.1% | | Current Liabilities | 60,568.8 | 59,441.1 | +1.9% | | Net Current Assets | 2,702.3 | 3,183.4 | -15.1% | | Total Assets | 103,110.0 | 103,586.7 | -0.5% | | Total Liabilities | 81,011.7 | 79,605.5 | +1.8% | | Gearing Ratio | 78.6% | 76.9% | +1.7 percentage points | | Net Assets | 22,098.4 | 23,981.2 | -7.8% | | Capital Gearing Ratio | 136.8% | 126.2% | +10.6 percentage points | - As of June 30, 2025, approximately RMB 29,634.2 million in loans were secured by properties under development for sale, properties held for sale, investment properties, property, plant and equipment, equity instruments at fair value through other comprehensive income, and pledged bank deposits132137367368 - On January 16, 2025, the Group sold its hotel property in Los Angeles, USA, for USD 20 million to reduce outstanding debt133138 Contingent Liabilities As of June 30, 2025, the Group provided financial guarantees of approximately RMB 6,894.0 million for buyers' mortgage financing, with directors deeming loss unlikely due to collateralized property recourse - As of June 30, 2025, the Group provided financial guarantees of approximately RMB 6,894.0 million for certain buyers' mortgage financing140148370375 - The guarantee period extends from the loan disbursement date until the buyer obtains the property ownership certificate or fully repays the loan, whichever is earlier142148372375 Exposure to Fluctuations in Exchange Rates and Related Hedges The Group's primary operations are in mainland China, denominated in RMB, but faces foreign exchange risk from HKD and USD cash and loans; currently, there is no hedging policy, but the Board monitors and may consider future adoption - The Group's principal operations are in mainland China, with most transactions denominated in RMB144149 - The Group is exposed to foreign exchange risk due to certain HKD and USD cash balances and loans144149 - The Group currently has no foreign currency hedging policy, but the Board closely monitors and may consider adopting one in the future145149 Treasury Policies and Capital Structure The Group adopts a prudent treasury and funding policy, focusing on risk management and transactions directly related to core business - The Group adopts prudent treasury and funding policies, focusing on risk management and transactions directly related to its core business146150 Employees As of June 30, 2025, the Group had 2,067 employees, with 2,035 in mainland China and 32 in Hong Kong, offering market-aligned compensation and training Number of Employees | Region | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Mainland China | 2,035 | 2,042 | | Hong Kong | 32 | 31 | | Total | 2,067 | 2,073 | - Employee compensation includes basic salaries, bonuses, retirement schemes, and long-term incentives, along with training and development programs147151 Other Information Events After the Reporting Period Post-reporting period, the company faces a winding-up petition, with the High Court adjourning the hearing to November 3, 2025; the Group is actively negotiating debt restructuring and has received positive responses from some creditors - A lender filed a winding-up petition against the company with the High Court on February 4, 2025, involving financial obligations of approximately USD 0.21 million in principal and accrued interest156155405 - The High Court has further adjourned the winding-up petition hearing to November 3, 2025156155405 - The company is actively negotiating with banks to extend financing and repayment periods, having received positive responses from several banks regarding extending bank facility maturity dates156155405 - The company has signed restructuring support letters with several creditors to advance restructuring, with more creditors actively considering signing156155405 Share Option Scheme The company adopted a new share option scheme on June 2, 2016, valid for ten years, with total shares issuable not exceeding 10% of issued shares; as of June 30, 2025, 225,340,000 unexercised options represent 3.72% of issued shares - The company adopted a new share option scheme on June 2, 2016, with a ten-year validity period157160162163 - The total number of shares that may be issued under the scheme shall not exceed 10% of the total issued shares on the adoption date (or 10% as refreshed)161163 Details of Share Option Movements (as of June 30, 2025) | Category | Balance as of Jan 1, 2025 | Lapsed during the period | Balance as of June 30, 2025 | Exercise Price Per Share (HKD) | | :--- | :--- | :--- | :--- | :--- | | Directors | 21,100,000 | (3,000,000) | 18,100,000 | 1.846 | | Senior Management, Employees & Others | 206,340,000 | – | 206,340,000 | 1.846 | | Total | 228,340,000 | (3,000,000) | 225,340,000 | | - As of June 30, 2025, 225,340,000 unexercised share options represented approximately 3.72% of the total issued shares170173 Directors' and Chief Executives' Interests in the Shares, Underlying Shares and Debentures of the Company As of June 30, 2025, directors and chief executives held interests in the company's shares and underlying shares, with Ms. Huang Jingshu and Mr. Huang Haoyuan holding significant stakes via family trusts and spousal interests, and Mr. Ye Xing'an and Mr. Huang Haoyuan holding share options Directors' and Chief Executives' Interests in the Company's Shares and Underlying Shares (as of June 30, 2025) | Director's Name | Capacity/Nature of Interest | Number of Shares Held | Number of Underlying Shares Held (Share Options) | Total Interest | Approximate Percentage of Issued Share Capital | | :--- | :--- | :--- | :--- | :--- | :--- | | Ms. Huang Jingshu | Beneficiary of a trust | 2,400,000,000 | – | 2,400,000,000 | 39.62% | | | Spouse's interest | 959,788,886 | 1,366,273,606 | 2,326,062,492 | 38.40% | | | Beneficial owner | – | 4,500,000 | 4,500,000 | 0.07% | | Mr. Ye Xing'an | Beneficial owner | – | 10,000,000 | 10,000,000 | 0.17% | | Mr. Huang Haoyuan | Beneficiary of a trust | 2,400,000,000 | – | 2,400,000,000 | 39.62% | | | Beneficial owner | – | 4,500,000 | 4,500,000 | 0.07% | | Ms. Li Yufei | Beneficial owner | 20,000 | – | 20,000 | 0.00% | - Ms. Huang Jingshu and Mr. Huang Haoyuan are deemed to have an interest in 2,400,000,000 shares as beneficiaries of Mr. Huang Kangjing's family trust185 - Ms. Huang Jingshu is deemed to have an interest in 959,788,886 shares and 1,366,273,606 convertible preference shares held by her spouse, Mr. Xu Junjia185 Substantial Shareholders' Interests in Shares and Underlying Shares of the Company As of June 30, 2025, substantial shareholders, including China Lvgem, Gaohong International, Mr. Huang Kangjing, and others, held 5% or more of the company's ordinary or convertible preference shares through direct, controlled corporate, or trust interests Substantial Shareholders' Interests in the Company's Ordinary Shares (as of June 30, 2025) | Shareholder Name/Entity | Capacity | Number of Shares Held | Number of Underlying Shares Held | Total Interest | Approximate Percentage of Issued Ordinary Share Capital | | :--- | :--- | :--- | :--- | :--- | :--- | | China Lvgem Property Holdings Limited | Beneficial owner | 1,265,766,583 | – | 1,265,766,583 | 20.91% | | Gaohong International Limited | Interest in controlled corporation | 1,372,909,094 | – | 1,372,909,094 | 22.66% | | Mr. Huang Kangjing | Interest in controlled corporation | 1,372,909,094 | – | 1,372,909,094 | 22.66% | | | Founder of a trust | 2,400,000,000 | – | 2,400,000,000 | 39.62% | | Jingchong Group Limited | Beneficial owner | 2,400,000,000 | – | 2,400,000,000 | 39.62% | | Greater Bay Area Common Home Investment Limited | Interest in controlled corporation | – | 1,209,954,000 | 1,209,954,000 | 19.97% | | Lexus Sharp International Limited | Beneficial owner | – | 1,166,789,698 | 1,166,789,698 | 19.26% | | Jiabao International Limited | Beneficial owner | 959,788,886 | – | 959,788,886 | 15.84% | | Mr. Xu Junjia | Spouse's interest | 2,404,500,000 | – | 2,404,500,000 | 39.67% | | Mr. Aaron Luke Gardner | Joint and several receiver | – | 959,788,886 | 959,788,886 | 15.84% | | China Construction Bank (Asia) Corporation Limited | Beneficial owner | 459,788,886 | – | 459,788,886 | 7.59% | Substantial Shareholders' Interests in the Company's Convertible Preference Shares (as of June 30, 2025) | Shareholder Name/Entity | Capacity | Number of Convertible Preference Shares Held | Approximate Percentage of Issued Ordinary Share Capital | | :--- | :--- | :--- | :--- | | China Lvgem Property Holdings Limited | Beneficial owner | 693,043,478 | 11.44% | | Mr. Huang Kangjing | Interest in controlled corporation | 977,043,478 | 16.13% | | Shengzhi International (Holdings) Limited | Beneficial owner | 1,060,000,000 | 17.50% | | Jiabao International Limited | Beneficial owner | 306,273,606 | 5.06% | | Mr. Xu Junjia | Interest in controlled corporation | 1,366,273,606 | 22.56% | | Mr. Aaron Luke Gardner | Joint and several receiver | 306,273,606 | 5.06% | Purchase, Sale or Redemption of the Company's Listed Securities For the six months ended June 30, 2025, neither the company nor its subsidiaries repurchased, sold, or redeemed any listed securities, and the company held no treasury shares - For the six months ended June 30, 2025, neither the company nor its subsidiaries repurchased, sold, or redeemed any listed securities205210 - As of June 30, 2025, the company held no treasury shares205210 Significant Investments, Acquisitions and Disposals Aside from the disclosed sale of a US hotel property, the Group undertook no other significant investments, acquisitions, or disposals requiring disclosure under Chapter 14 of the Listing Rules for the six months ended June 30, 2025 - Except for the disclosed sale of the Los Angeles hotel property in the USA, the Group had no other significant investments, acquisitions, or disposals during the reporting period206211 Changes in Directors' Information Since the 2024 annual report, Ms. Wang Tingdan was appointed Independent Non-Executive Director and Remuneration Committee Chair; Ms. Li Yufei was appointed director of Chengyou Group; Ms. Jiao Jie was appointed independent director of Amber International Holding and resigned from China Sunshine Paper Holdings - Ms. Wang Tingdan was appointed Independent Non-Executive Director, Audit Committee member, and Remuneration Committee Chair on May 13, 2025214 - Ms. Li Yufei was appointed Director of Chengyou Group Limited on July 14, 2025214 - Ms. Jiao Jie was appointed Independent Director of Amber International Holding Limited on July 3, 2025, and resigned as Independent Non-Executive Director of China Sunshine Paper Holdings Limited on August 29, 2025214 Compliance with the Code on Corporate Governance Practices The company is committed to good corporate governance; Ms. Huang Jingshu's dual role as Chairman and CEO deviates from Code Provision C.2.1, but the Board deems it effective, and temporary non-compliance with Listing Rules due to independent non-executive director resignations was rectified by new appointments - Ms. Huang Jingshu has served as both Chairman and Chief Executive Officer since March 31, 2024, deviating from Corporate Governance Code Provision C.2.1209213 - Following the resignation of independent non-executive directors, the Board temporarily did not meet Listing Rule requirements for the number of independent non-executive directors and the composition of the Audit and Remuneration Committees216221 - The company appointed Ms. Wang Tingdan on May 13, 2025, to fill the vacancy, thereby regaining compliance with relevant Listing Rules216221 - Except for the aforementioned disclosures, the company complied with all code provisions of the Corporate Governance Code for the six months ended June 30, 2025217222 Compliance with the Model Code for Securities Transactions by Directors The company adopted the Model Code for directors' securities transactions, and all directors confirmed compliance with its required standards for the six months ended June 30, 2025 - The company has adopted the Model Code as its code of conduct for directors' securities transactions218223 - All directors confirmed compliance with the required standards of the Model Code for the six months ended June 30, 2025218223 Directors' Service Agreements Executive directors have service contracts, and independent non-executive directors have one or two-year appointment letters, all terminable per terms; no director has a service contract or appointment letter not terminable within one year without compensation (excluding statutory compensation) - Executive directors have service contracts with the company, while independent non-executive directors have appointment letters for one or two-year terms219220224225 - No director has a service contract or appointment letter that cannot be terminated within one year without compensation (other than statutory compensation)226 Review of Interim Results by Audit Committee The Audit Committee discussed and reviewed the unaudited interim condensed consolidated financial statements for the six months ended June 30, 2025, which were not reviewed or audited by the company's auditor - The Audit Committee discussed and reviewed the unaudited interim condensed consolidated financial statements for the six months ended June 30, 2025228229 - These unaudited condensed consolidated interim results were not reviewed or audited by the company's auditor228229 Condensed Consolidated Financial Statements Condensed Consolidated Statement of Profit or Loss For the six months ended June 30, 2025, the Group reported revenue of RMB 1,039.7 million, gross profit of RMB 376.3 million, a loss for the period of RMB 2,029.8 million, loss attributable to equity holders of RMB 1,837.9 million, and basic loss per share of RMB 31.25 cents Summary of Condensed Consolidated Statement of Profit or Loss | Indicator | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | | :--- | :--- | :--- | | Revenue | 1,039,691 | 1,942,823 | | Cost of sales | (663,395) | (1,505,091) | | Gross profit | 376,296 | 437,732 | | Other income | 18,521 | 35,326 | | Other gains and losses, net | (105,108) | (21,905) | | Impairment loss recognized on properties held for sale | (471,228) | – | | Selling expenses | (50,113) | (59,726) | | Administrative expenses | (190,934) | (206,673) | | Fair value change of investment properties | (1,070,050) | (951,714) | | Finance costs | (682,597) | (833,526) | | Loss before tax | (2,175,213) | (1,600,486) | | Income tax credit (expense) | 145,428 | (9,933) | | Loss for the period | (2,029,785) | (1,610,419) | | Loss attributable to equity holders of the Company | (1,837,931) | (1,528,224) | | Basic loss per share (RMB cents) | (31.25) | (29.98) | Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income For the six months ended June 30, 2025, the Group reported a loss of RMB 2,029.8 million, with other comprehensive income of RMB 147.0 million primarily from exchange differences and fair value changes of equity instruments, resulting in total comprehensive expense of RMB 1,882.8 million Summary of Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income | Indicator | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | | :--- | :--- | :--- | | Loss for the period | (2,029,785) | (1,610,419) | | Exchange differences on translation | 84,520 | (24,882) | | Fair value change of equity instruments at fair value through other comprehensive income (net of tax) | 62,438 | 55,168 | | Other comprehensive income for the period | 146,958 | 30,286 | | Total comprehensive expense for the period | (1,882,827) | (1,580,133) | | Total comprehensive expense attributable to equity holders of the Company | (1,691,096) | (1,497,373) | Condensed Consolidated Statement of Financial Position As of June 30, 2025, the Group's total assets were RMB 103,110.0 million, total liabilities RMB 81,011.7 million, with a gearing ratio of 78.6%; net current assets were RMB 2,702.3 million, and net assets RMB 22,098.4 million Summary of Condensed Consolidated Statement of Financial Position (as of June 30, 2025) | Indicator | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Non-current assets | | | | Investment properties | 37,330,765 | 38,258,781 | | Property, plant and equipment | 606,382 | 799,449 | | Interests in joint ventures | 6,051 | 6,051 | | Amount due from a joint venture | 501,179 | 501,179 | | Equity instruments at fair value through other comprehensive income | 607,554 | 524,303 | | Restricted bank deposits and pledged bank deposits | 169,765 | 259,602 | | Deferred tax assets | 617,244 | 612,893 | | Total non-current assets | 39,838,940 | 40,962,258 | | Current assets | | | | Properties under development for sale | 51,420,109 | 49,071,485 | | Properties held for sale | 3,987,961 | 4,594,435 | | Accounts receivable | 87,083 | 68,174 | | Restricted bank deposits and pledged bank deposits | 1,449,487 | 2,446,765 | | Bank balances and cash | 342,458 | 597,456 | | Total current assets | 63,271,098 | 62,624,419 | | Current liabilities | | | | Accounts payable | 4,922,460 | 4,444,260 | | Contract liabilities | 10,435,246 | 8,926,083 | | Borrowings | 29,310,883 | 30,633,249 | | Total current liabilities | 60,568,750 | 59,441,065 | | Non-current liabilities | | | | Borrowings | 1,747,351 | 1,828,128 | | Deferred tax liabilities | 3,485,319 | 3,633,509 | | Total non-current liabilities | 20,442,912 | 20,164,409 | | Net assets | 22,098,376 | 23,981,203 | Condensed Consolidated Statement of Changes in Equity For the six months ended June 30, 2025, equity attributable to equity holders decreased from RMB 18,039.6 million to RMB 16,348.5 million, primarily due to period loss and exchange differences, partially offset by convertible preference share conversions and statutory reserve transfers Summary of Condensed Consolidated Statement of Changes in Equity | Indicator | January 1, 2025 (RMB thousand) | Loss for the period (RMB thousand) | Total comprehensive income/(expense) for the period (RMB thousand) | Conversion of convertible preference shares (RMB thousand) | June 30, 2025 (RMB thousand) | | :--- | :--- | :--- | :--- | :--- | :--- | | Share capital | 46,702 | – | – | 8,134 | 54,836 | | Share premium | 8,031,680 | – | – | 1,667,430 | 9,699,110 | | Convertible preference shares | 5,126,320 | – | – | (1,675,564) | 3,450,756 | | Reserves | 6,877,971 | (1,837,931) | (1,691,096) | – | 5,044,070 | | Equity attributable to equity holders of the Company | 18,039,614 | (1,837,931) | (1,691,096) | – | 16,348,518 | | Non-controlling interests | 5,941,589 | (191,854) | (191,731) | – | 5,749,858 | | Total equity | 23,981,203 | (2,029,785) | (1,882,827) | – | 22,098,376 | Condensed Consolidated Statement of Cash Flows For the six months ended June 30, 2025, the Group generated RMB 1,161.4 million net cash from operating activities and RMB 510.3 million from investing activities, while using RMB 1,955.8 million in financing activities, resulting in a decrease in period-end cash and cash equivalents to RMB 342.5 million Summary of Condensed Consolidated Statement of Cash Flows | Indicator | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | | :--- | :--- | :--- | | Net cash generated from operating activities | 1,161,374 | 972,686 | | Net cash generated from investing activities | 510,277 | 608,471 | | Net cash used in financing activities | (1,955,788) | (1,282,198) | | Net (decrease)/increase in cash and cash equivalents | (284,137) | 298,959 | | Cash and cash equivalents at end of period | 342,458 | 812,350 | Notes to the Condensed Consolidated Financial Statements This section provides detailed notes to the condensed consolidated financial statements, covering presentation basis, accounting policies, revenue, segment information, gains/losses, finance costs, loss before tax, income tax, dividends, loss per share, investment property movements, equity instruments, receivables, payables, borrowings, domestic corporate bonds, share capital, convertible bond debt, share-based compensation, asset pledges, financial guarantees, related party disclosures, fair value measurement of financial instruments, and post-reporting events Basis of Presentation The condensed consolidated financial statements are prepared on a going concern basis, despite a RMB 2,030 million net loss and RMB 29,593 million in short-term borrowings, with the company implementing various measures including debt restructuring and asset sales to improve liquidity and maintain operations for at least twelve months - For the six months ended June 30, 2025, the Group incurred a net loss of RMB 2,030 million243245 - As of June 30, 2025, the Group had RMB 29,593 million in borrowings repayable within one year, of which RMB 29,139 million were repayable on demand due to defaults or cross-defaults243245 - A lender filed a winding-up petition against the company with the High Court on February 4, 2025243245 - The company has implemented various plans and measures, including seeking legal advice to oppose the winding-up petition, appointing advisors for offshore debt restructuring, negotiating with lenders for repayment extensions, utilizing credit facilities, accelerating sales, controlling costs, and seeking asset disposals244246247248249 Principal Accounting Policies The condensed consolidated financial statements are prepared on a historical cost basis, except for investment properties and certain financial instruments, with accounting policies consistent with the 2024 annual financial statements and no material impact from new HKFRS amendments - The condensed consolidated financial statements are prepared on a historical cost basis, except for investment properties and certain financial instruments measured at fair value252257 - The accounting policies and methods of computation are consistent with those presented in the 2024 annual financial statements253257 - The Group first applied HKAS 21 (Amendment) 'Lack of Exchangeability' with no material impact on financial position or performance254258 Revenue and Segment Information The Group's revenue primarily stems from property sales, hotel operations, property management, and rental income, with three reportable segments; H1 2025 saw a significant decline in property development revenue, while commercial property and comprehensive services revenues slightly decreased Revenue Source Analysis | Revenue Source | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | | :--- | :--- | :--- | | Sales of properties | 527,497 | 1,389,244 | | Revenue from hotel operations, property management services and other services | 200,367 | 210,871 | | Total revenue from contracts with customers | 727,864 | 1,600,115 | | Rental income | 311,827 | 342,708 | | Total Revenue | 1,039,691 | 1,942,823 | Revenue and Results by Operating Segment (H1 2025) | Segment | Revenue from External Customers (RMB thousand) | Reportable Segment Profit (RMB thousand) | | :--- | :--- | :--- | | Real Estate Development and Sales | 527,497 | 20,094 | | Commercial Property Investment and Operations | 311,827 | 301,235 | | Comprehensive Services | 200,367 | 54,967 | | Total | 1,039,691 | 376,296 | - The Group's operations are located in mainland China, Hong Kong, the United States of America, and the Kingdom of Cambodia, with revenue primarily derived from mainland China278280 Other Gains and Losses, Net For the six months ended June 30, 2025, the Group recorded net other gains and losses of RMB (105.1) million, primarily comprising net foreign exchange losses and losses on disposal of property, plant and equipment Composition of Other Gains and Losses, Net | Item | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | | :--- | :--- | :--- | | Net foreign exchange losses | (78,342) | (23,871) | | Loss on disposal of property, plant and equipment | (26,940) | – | | Others | 174 | 1,966 | | Total | (105,108) | (21,905) | Finance Costs For the six months ended June 30, 2025, the Group's finance costs were approximately RMB 682.6 million, a 18.1% year-on-year decrease, primarily comprising interest expenses from bank and other borrowings, convertible bonds, domestic corporate bonds, lease liabilities, and contract liabilities, with some amounts capitalized Composition of Finance Costs | Item | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | | :--- | :--- | :--- | | Interest expense on bank and other borrowings | 1,177,775 | 1,352,462 | | Interest expense on convertible bonds | 10,170 | 11,806 | | Interest expense on domestic corporate bonds | 42,117 | 41,532 | | Interest expense on lease liabilities | 16,272 | 11,625 | | Interest expense on contract liabilities | 304,914 | 154,712 | | Less: Amount capitalized | (563,737) | (583,899) | | Less: Capitalization of interest on contract liabilities | (304,914) | (154,712) | | Total | 682,597 | 833,526 | - Finance costs decreased by approximately 18.1% year-on-year115121 - Finance costs were capitalized at annual interest rates ranging from 4.85% to 6.62% (H1 2024: 4.50% to 7.50%)286 Loss Before Tax For the six months ended June 30, 2025, the Group's loss before tax was RMB 2,175.2 million, primarily influenced by costs of properties held for sale, depreciation of property, plant and equipment, investment property rental income, and related operating expenses Composition of Loss Before Tax | Item | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | | :--- | :--- | :--- | | Cost of properties held for sale recognized as an expense | 507,403 | 1,364,770 | | Depreciation of property, plant and equipment | 30,136 | 30,540 | | Gross rental income from investment properties | (311,827) | (342,708) | | Direct operating expenses arising from investment properties that generated rental income during the period | 10,592 | 7,762 | Income Tax Credit (Expense) For the six months ended June 30, 2025, the Group recorded an income tax credit of approximately RMB 145.4 million, compared to an expense of RMB 9.9 million in the prior period, primarily comprising PRC corporate income tax, PRC land appreciation tax, and deferred tax Composition of Income Tax Credit (Expense) | Item | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | | :--- | :--- | :--- | | PRC corporate income tax | 1,293 | 117,625 | | PRC land appreciation tax | 26,625 | 99,386 | | Deferred tax | (173,346) | (207,078) | | Total | (145,428) | 9,933 | Dividends No dividends were paid, declared, or proposed for the interim period, as the Board decided against any dividend payment for this interim period - No dividends were paid, declared, or proposed for the interim period292293 Loss Per Share For the six months ended June 30, 2025, basic and diluted loss per share attributable to equity holders was RMB 31.25 cents; diluted loss calculation did not assume conversion of convertible preference shares or exercise of share options, as this would reduce loss per share or involve exercise prices above average market prices Loss Per Share Calculation Data | Indicator | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | | :--- | :--- | :--- | | Loss for the purpose of calculating basic and diluted loss per share | (1,837,931) | (1,528,224) | | Weighted average number of ordinary shares of the Company for the purpose of calculating basic and diluted loss per share (thousand shares) | 5,882,214 | 5,097,704 | | Basic loss per share (RMB cents) | (31.25) | (29.98) | | Diluted loss per share (RMB cents) | (31.25) | (29.98) | - The calculation of diluted loss per share did not assume conversion of convertible preference shares or exercise of share options, as this would result in a decrease in loss per share or an exercise price higher than the average market price295297 Movements in Investment Properties and Property, Plant and Equipment In H1 2025, the Group incurred RMB 0.7 million in capital expenditure for property, plant and equipment and RMB 278.6 million for investment properties, recorded a RMB 1,070.1 million fair value loss on investment properties, and valued them using income capitalization, direct comparison, and residual methods Capital Expenditure and Disposals | Item | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | | :--- | :--- | :--- | | Capital expenditure on property, plant and equipment | 702 | 544 | | Capital expenditure on investment properties | 278,605 | 270,648 | | Gross carrying amount of investment properties disposed of | 22,329 | 1,279,400 | | Cash proceeds from disposal of investment properties | 18,908 | 775,113 | - The fair value change of investment properties resulted in a loss of approximately RMB 1,070.1 million114120299305 - Investment properties were valued using the income capitalization approach, direct comparison approach, and residual method300303306307 Equity Instruments at FVTOCI As of June 30, 2025, the Group's total investment in equity instruments at FVTOCI was RMB 607.6 million, primarily comprising listed equity securities in mainland China and equity in unlisted companies, held for long-term strategic purposes Investments in Equity Instruments at FVTOCI | Investment Category | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Equity securities listed in mainland China | 604,989 | 521,738 | | Equity interests in certain unlisted companies | 2,565 | 2,565 | | Total | 607,554 | 524,303 | - These investments are not held for trading but for long-term strategic purposes315 Accounts Receivable As of June 30, 2025, the Group's net accounts receivable totaled RMB 87.1 million, primarily from customer contracts and lease receivables, with most balances due within 12 months Aging Analysis of Accounts Receivable (Net) | Aging | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Within 1 month | 17,325 | 24,217 | | 1 to 12 months | 49,665 | 33,501 | | 13 to 24 months | 20,093 | 10,456 | | Total | 87,083 | 68,174 | - Accounts receivable primarily arise from property sales, rental income from leased properties, and comprehensive services317 Accounts Payable As of June 30, 2025, the Group's total accounts payable amounted to RMB 4,922.5 million, with the majority due within 1 to 12 months according to the aging analysis Aging Analysis of Accounts Payable | Aging | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Within 1 month | 997,984 | 1,903,996 | | 1 to 12 months | 2,585,973 | 1,872,320 | | 13 to 24 months | 1,139,048 | 530,660 | | Over 24 months | 199,455 | 137,284 | | Total | 4,922,460 | 4,444,260 | Borrowings As of June 30, 2025, the Group's total borrowings were approximately RMB 31,058.2 million, mostly floating-rate bank loans; RMB 29,634.2 million were secured by Group assets and/or the ultimate controlling shareholder's equity instruments, with RMB 27,778.6 million repayable on demand due to covenant breaches Composition and Repayment Period of Borrowings | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Floating-rate bank loans | 24,968,955 | 25,612,596 | | Fixed-rate bank loans | 1,537,485 | 2,267,563 | | Fixed-rate other borrowings | 4,551,794 | 4,581,218 | | Total Borrowings | 31,058,234 | 32,461,377 | | Of which: Secured | 29,634,190 | 30,893,130 | | Of which: Unsecured | 1,424,044 | 1,568,247 | | Borrowings repayable within 1 year | 314,595 | 289,223 | | Borrowings repayable on demand due to breach of loan covenants | 27,778,598 | 29,108,972 | - Secured borrowings are collateralized by various Group assets, equity interests in subsidiaries, and/or certain equity instruments held by Mr. Huang, the ultimate controlling shareholder323 - For the six months ended June 30, 2025, the average financing cost for interest-bearing loans was approximately 7.9%115121 Domestic Corporate Bonds As of June 30, 2025, the Group's total domestic corporate bonds amounted to RMB 975.5 million, with RMB 129.9 million classified as current and RMB 845.6 million as non-current Domestic Corporate Bonds Analysis | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Current | 129,878 | 129,821 | | Non-current | 845,632 | 845,265 | | Total | 975,510 | 975,086 | Share Capital As of June 30, 2025, the company's authorized share capital was 30,000,000 thousand shares with a par value of HKD 0.01 each; issued and fully paid share capital was 6,057,493 thousand shares, amounting to RMB 54,836 thousand Composition of Share Capital | Item | June 30, 2025 (thousand shares) | June 30, 2025 (RMB thousand) | December 31, 2024 (thousand shares) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | :--- | :--- | | Authorized share capital (ordinary shares of HKD 0.01 each) | 30,000,000 | 240,000 | 30,000,000 | 240,000 | | Issued and fully paid share capital (ordinary shares of HKD 0.01 each) | 6,057,493 | 54,836 | 5,597,704 | 46,702 | Bond/Debt Component of Convertible Bond As of June 30, 2025, the convertible bond debt component's net book value was RMB 151.8 million; the company issued 2018 and 2025 convertible bonds, with the 2025 bond maturing in H1 2025 and its conversion option having zero fair value Movements in Convertible Bond Debt Component | Item | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | | :--- | :--- | :--- | | Net book value at January 1 | 142,213 | 119,898 | | Interest expense | 10,170 | 24,561 | | Interest paid | – | (4,264) | | Exchange difference | (621) | 2,018 | | Net book value classified as current liabilities at June 30/December 31 | 151,762 | 142,213 | - The 2018 convertible bond's maturity date was extended multiple times, with revised covenants including shareholders' equity not less than RMB 11.5 billion and total debt to total assets ratio not exceeding 75%337340 - The 2025 convertible bond, with a principal of USD 20 million, an annual interest rate of 6%, and an initial conversion price of HKD 2.00, matured in H1 2025351358360 - As of June 30, 2025, the fair value of the conversion option for the 2025 convertible bond was zero358360 Share-Based Employee Compensation The company adopted a share option scheme on June 2, 2016, granting 285,800,000 options on June 28, 2016; as of June 30, 2025, 225,340,000 options remained unexercised, with 3,000,000 forfeited due to independent non-executive director resignations, and no ordinary options exercised during the period - The company granted 285,800,000 share options on June 28, 2016, with an exercise price of HKD 1.846 per share166171359361 Details of Share Option Movements (as of June 30, 2025) | Category | Balance as of Jan 1, 2025 | Forfeited during the period | Balance as of June 30, 2025 | Exercise Price Per Share (HKD) | | :--- | :--- | :--- | :--- | :--- | | Directors | 21,100,000 | (3,000,000) | 18,100,000 | 1.846 | | Employees and Others | 206,340,000 | – | 206,340,000 | 1.846 | | Total | 228,340,000 | (3,000,000) | 225,340,000 | | - No ordinary share options were exercised during the period365366 Pledge of Assets As of June 30, 2025, the Group pledged approximately RMB 22,601.0 million in assets, including properties under development for sale, properties held for sale, investment properties, equity instruments at FVTOCI, pledged bank deposits, and property, plant and equipment, as collateral for various bank and other financings Total Pledged Assets | Asset Category | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Properties under development for sale | 4,353,194 | 4,330,409 | | Properties held for sale | 1,108,093 | 1,178,283 | | Equity instruments at fair value through other comprehensive income | 604,989 | 521,738 | | Investment properties | 15,602,654 | 15,901,447 | | Pledged bank deposits | 290,479 | 592,846 | | Property, plant and equipment | 557,248 | 753,694 | | Dividends receivable from equity instruments at fair value through other comprehensive income | 84,390 | 71,846 | | Total | 22,601,047 | 23,350,263 | - The Group's equity interests in certain subsidiaries are also pledged as collateral for various bank financings369 Financial Guarantee Contracts and Commitments As of June 30, 2025, the Group provided financial guarantees of approximately RMB 6,894.0 million for buyers' mortgage financing and had contracted but unprovided capital and other commitments of RMB 11,650.9 million related to investment properties under construction, properties under development for sale, and demolition compensation - As of June 30, 2025, the Group provided financial guarantees of approximately RMB 6,894.0 million for certain buyers' mortgage financing370375 - The Group had contracted but unprovided capital and other commitments of RMB 11,650.9 million, relating to investment properties under construction, properties under development for sale, and demolition compensation payments374376 [Related Party Disclosures](index=69&type=section&id=
绿景中国地产(00095) - 2025 - 中期财报