百信国际(00574) - 2025 - 中期财报

Company Information This section details changes in the board and committee members, along with updates to the company's contact and audit information Board and Committee Members The board saw changes in independent non-executive directors across the Audit, Remuneration, and Nomination Committees, with new appointments and one retirement - Independent Non-Executive Director Mr. Xu Qilin retired on June 26, 2025[4] - Independent Non-Executive Director Mr. Wang Dongyuan was appointed as a member of the Audit and Remuneration Committees and Chairman of the Nomination Committee on June 26, 2025[4] - Independent Non-Executive Director Professor Lou Zhenye was appointed as a member of the Nomination and Corporate Governance Committees on June 26, 2025[4][5] Company Contact and Audit Information The company's principal place of business remains unchanged, but the auditor was changed on December 9, 2024 - The auditor resigned from Zhongzheng Tianheng Certified Public Accountants Limited and Furuimaze Certified Public Accountants Limited was appointed on December 9, 2024[5] - The company's stock code is 00574 and its website is **www.pashun.com.cn**[5](index=5&type=chunk) Condensed Consolidated Statement of Profit or Loss This section presents the group's profit or loss performance, highlighting the shift from profit to loss primarily due to the absence of a one-off debt restructuring gain Profit or Loss Overview The Group shifted from a profit of RMB35,427 thousand to a loss of RMB9,055 thousand, primarily due to the absence of a one-off debt restructuring gain Condensed Consolidated Statement of Profit or Loss Key Data (For the six months ended June 30) | Indicator | 2025 (RMB '000) | 2024 (RMB '000) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 48,693 | 48,830 | -0.28% | | Cost of sales | (42,481) | (39,303) | +8.09% | | Gross profit | 6,212 | 9,527 | -34.80% | | Gain on debt restructuring of the Company | – | 47,356 | -100.00% | | Other income | 692 | 734 | -5.72% | | Other losses – net | (1,623) | (6,362) | -74.49% | | Selling and distribution expenses | (2,375) | (3,408) | -30.32% | | General and administrative expenses | (5,707) | (7,281) | -21.61% | | Finance costs | (6,253) | (5,075) | +23.21% | | (Loss)/Profit before tax | (9,054) | 35,491 | -125.51% | | Income tax expense | (1) | (64) | -98.44% | | (Loss)/Profit for the period | (9,055) | 35,427 | -125.56% | - The Group turned from profit to loss, primarily due to a one-off gain of RMB47.4 million from debt restructuring in the prior period of 2024, which was absent in 2025[7][54] Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income This section outlines the group's comprehensive income performance, showing a shift from total comprehensive income to total comprehensive expense, influenced by period loss and exchange differences Comprehensive Income Overview The Group recorded a total comprehensive expense of RMB12,432 thousand, a shift from a total comprehensive income of RMB38,585 thousand, driven by period loss and exchange differences Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income Key Data (For the six months ended June 30) | Indicator | 2025 (RMB '000) | 2024 (RMB '000) | | :--- | :--- | :--- | | (Loss)/Profit for the period | (9,055) | 35,427 | | Exchange differences arising from translation of financial statements | (3,377) | 3,158 | | Total comprehensive (expense)/income for the period attributable to equity holders of the Company | (12,432) | 38,585 | (Loss)/Earnings Per Share (For the six months ended June 30) | Indicator | 2025 | 2024 | | :--- | :--- | :--- | | Basic (loss)/earnings per share | (0.61) | 2.4 | | Diluted (loss)/earnings per share | Not applicable | Not applicable | - Basic loss per share was RMB0.61, compared to basic profit per share of RMB2.4 in the prior period[11][35] Condensed Consolidated Statement of Financial Position This section presents the group's financial position, indicating a deterioration with a net current liability and a significant decrease in cash and cash equivalents Financial Position Overview The Group's financial position deteriorated to a net current liability of RMB29,486 thousand, with a significant decrease in cash and cash equivalents Condensed Consolidated Statement of Financial Position Key Data (As of June 30) | Indicator | June 30, 2025 (RMB '000) | December 31, 2024 (RMB '000) | Change (%) | | :--- | :--- | :--- | :--- | | Non-current assets | 74,507 | 74,787 | -0.37% | | Current assets | 87,455 | 104,859 | -16.69% | | Current liabilities | 116,941 | 103,528 | +12.96% | | Net current (liabilities)/assets | (29,486) | 1,331 | -2315.00% | | Non-current liabilities | 193,489 | 212,154 | -8.79% | | Net liabilities | (148,468) | (136,036) | +9.14% | | Cash and cash equivalents | 3,562 | 15,972 | -77.70% | - The current ratio decreased from 1.01 as of December 31, 2024, to 0.75 as of June 30, 2025, indicating increased liquidity pressure[56] - Trade and bills receivables increased by 58.32% from RMB26,136 thousand as of December 31, 2024, to RMB41,380 thousand as of June 30, 2025[12][39] Condensed Consolidated Statement of Changes in Equity This section details changes in the group's equity, showing an increase in accumulated losses attributable to equity holders, primarily due to the loss for the period and a decrease in exchange reserves Equity Changes Overview The total deficit attributable to equity holders increased to RMB(148,468) thousand, primarily due to the period's loss and reduced exchange reserves Condensed Consolidated Statement of Changes in Equity Key Data (For the six months ended June 30) | Indicator | June 30, 2025 (RMB '000) | December 31, 2024 (RMB '000) | | :--- | :--- | :--- | | Share capital | 1,216 | 1,216 | | Share premium | 691,882 | 691,882 | | Statutory reserve | 33,143 | 33,143 | | PRC reserve | 11,456 | 11,456 | | Exchange reserve | (26,527) | (23,150) | | Other reserve | (28,150) | (28,150) | | Accumulated losses | (831,488) | (822,433) | | Total deficit attributable to equity holders of the Company | (148,468) | (136,036) | - The loss for the period of RMB9,055 thousand led to a further expansion of accumulated losses[14] - Exchange differences arising from the translation of financial statements of overseas entities resulted in a negative RMB3,377 thousand, negatively impacting total comprehensive expense[14] Condensed Consolidated Statement of Cash Flows This section outlines the group's cash flow performance, showing an improvement in net cash used in operating activities but an increase in cash outflow from financing activities, leading to a larger net decrease in cash and cash equivalents Cash Flow Overview Net cash used in operating activities improved, but increased financing outflows led to a larger net decrease in cash and cash equivalents, significantly reducing the period-end cash balance Condensed Consolidated Statement of Cash Flows Key Data (For the six months ended June 30) | Indicator | 2025 (RMB '000) | 2024 (RMB '000) | | :--- | :--- | :--- | | Net cash used in operating activities | (7,382) | (14,548) | | Net cash used in investing activities | (528) | (20) | | Net cash (used in)/generated from financing activities | (4,500) | 2,691 | | Net decrease in cash and cash equivalents | (12,410) | (11,877) | | Cash and cash equivalents at end of period | 3,562 | 4,634 | - Net cash used in operating activities improved from RMB(14,548) thousand in the prior period to RMB(7,382) thousand in the current period[15] - Cash flow from financing activities shifted from an inflow in the prior period to an outflow in the current period, primarily due to the repayment of other borrowings[15] Notes to the Condensed Consolidated Interim Financial Statements This section provides detailed notes to the interim financial statements, covering accounting policies, new standards, segment reporting, and specific financial line items 1. Basis of Preparation of Financial Statements The financial statements are prepared under Hong Kong Financial Reporting Standards and generally accepted accounting principles, complying with HKEX Listing Rules - The financial statements are prepared on a historical cost basis, presented in RMB, with all values rounded to the nearest thousand[16] 2. Application of New and Revised Hong Kong Financial Reporting Standards The Group applied revised HKFRS effective on or after January 1, 2025, with no significant impact, and anticipates no material impact from future standards - HKAS 21 (Amendment) 'Lack of Exchangeability' became effective for the first time during this interim period but had no significant impact on the financial statements[18] - The Directors anticipate that the application of new and revised HKFRSs not yet effective, such as HKFRS 18 'Presentation and Disclosure in Financial Statements', will not have a material impact on the condensed consolidated financial statements in the foreseeable future[20] 3. Revenue and Segment Reporting The Group's primary businesses are pharmaceutical distribution and manufacturing in China, with total revenue stable, but distribution grew while manufacturing declined significantly - The Group's principal businesses are pharmaceutical distribution and manufacturing of pharmaceutical products in China[21] Revenue by Business Category (For the six months ended June 30) | Revenue Category | 2025 (RMB '000) | 2024 (RMB '000) | Change (%) | | :--- | :--- | :--- | :--- | | Pharmaceutical distribution | 43,013 | 33,267 | +29.31% | | Pharmaceutical manufacturing | 5,680 | 15,563 | -63.51% | | Total Revenue | 48,693 | 48,830 | -0.28% | - Gross profit from pharmaceutical distribution decreased from RMB3,684 thousand in the prior period to RMB3,532 thousand in the current period, while gross profit from pharmaceutical manufacturing significantly decreased from RMB5,843 thousand to RMB2,680 thousand[26] 4. Other Income and Other Gains/(Losses) – Net Other income slightly decreased, while other net losses significantly reduced, primarily due to increased reversal of impairment losses on trade receivables Other Income (For the six months ended June 30) | Item | 2025 (RMB '000) | 2024 (RMB '000) | | :--- | :--- | :--- | | Bank interest income | 4 | 7 | | Deferred income – government grants | 256 | 256 | | Rental income from short-term leases | 432 | 444 | | Others | – | 27 | | Total | 692 | 734 | Other Losses – Net (For the six months ended June 30) | Item | 2025 (RMB '000) | 2024 (RMB '000) | | :--- | :--- | :--- | | Impairment loss on trade receivables | (2,734) | (2,021) | | Impairment loss on other receivables | (1,430) | – | | Impairment loss on prepayments and deposits paid | (1,223) | (4,342) | | Reversal of impairment loss on trade receivables | 3,712 | – | | Reversal of impairment loss on other receivables | – | 53 | | Others | 52 | (52) | | Total | (1,623) | (6,362) | - Other net losses significantly decreased from RMB(6,362) thousand in the prior period to RMB(1,623) thousand in the current period, mainly due to a reversal of impairment losses on trade receivables of RMB3,712 thousand[30][50] 5. Finance Costs Finance costs increased by 23.2% to RMB6,253 thousand, mainly due to increased imputed interest on repayment obligations under the debt repayment arrangement scheme Finance Costs (For the six months ended June 30) | Item | 2025 (RMB '000) | 2024 (RMB '000) | | :--- | :--- | :--- | | Interest on bank and other borrowings | 619 | 2,115 | | Interest on corporate bonds payable | – | 519 | | Interest on repayment obligations under the debt repayment arrangement scheme | 5,634 | 2,441 | | Total | 6,253 | 5,075 | - Interest on repayment obligations under the debt repayment arrangement scheme significantly increased from RMB2,441 thousand in the prior period to RMB5,634 thousand in the current period[31][53] 6. (Loss)/Profit Before Tax Loss before tax was RMB9,054 thousand, a shift from a profit of RMB35,491 thousand, primarily due to the impact of the debt restructuring gain (Loss)/Profit Before Tax Components (For the six months ended June 30) | Item | 2025 (RMB '000) | 2024 (RMB '000) | | :--- | :--- | :--- | | Cost of inventories sold | 42,481 | 39,303 | | Total staff costs | 3,143 | 3,420 | | Depreciation of property, plant and equipment | 782 | 1,271 | | Depreciation of right-of-use assets | 26 | 29 | | Auditor's remuneration | – | 111 | - Total staff costs slightly decreased from RMB3,420 thousand in the prior period to RMB3,143 thousand in the current period[32] - Depreciation of property, plant and equipment decreased from RMB1,271 thousand in the prior period to RMB782 thousand in the current period[32][37] 7. Income Tax Expense Income tax expense significantly reduced to RMB1 thousand, as the Group had no taxable profits in Cayman Islands, BVI, Hong Kong, or its PRC subsidiaries Income Tax Expense (For the six months ended June 30) | Item | 2025 (RMB '000) | 2024 (RMB '000) | | :--- | :--- | :--- | | Current tax – PRC Enterprise Income Tax | – | – | | Deferred tax | – | 64 | | Total | (1) | (64) | - The Group is not subject to income tax in the Cayman Islands, British Virgin Islands, and Hong Kong[33] - PRC subsidiaries are subject to PRC Enterprise Income Tax at a statutory rate of 25%, but no provision was made for the current period due to the absence of taxable profits[33] 8. Dividends The Board does not recommend the payment of any interim dividend for the six months ended June 30, 2025, consistent with the prior period - The Board does not recommend the payment of any interim dividend for the six months ended June 30, 2025[34] 9. (Loss)/Earnings Per Share Basic loss per share was RMB0.61, compared to basic profit per share of RMB2.4, with diluted (loss)/earnings per share not presented due to option exercise prices (Loss)/Earnings Per Share (For the six months ended June 30) | Indicator | 2025 | 2024 | | :--- | :--- | :--- | | Basic (loss)/earnings per share | (0.61) | 2.4 | | Diluted (loss)/earnings per share | Not applicable | Not applicable | - Basic loss per share is calculated based on the loss attributable to equity holders of RMB9,054 thousand and the weighted average number of 1,474,993 thousand ordinary shares in issue[35] - Diluted (loss)/earnings per share is not presented as the exercise price of share options was higher than the average market price of the shares[36] 10. Property, Plant and Equipment Depreciation of property, plant and equipment decreased to RMB782 thousand for the six months ended June 30, 2025 Depreciation of Property, Plant and Equipment (For the six months ended June 30) | Item | 2025 (RMB '000) | 2024 (RMB '000) | | :--- | :--- | :--- | | Depreciation | 782 | 1,271 | 11. Right-of-use Assets The Group did not enter into any new lease agreements during this interim period - The Group did not enter into any new lease agreements during this interim period[38] 12. Trade and Other Receivables Total trade and other receivables increased to RMB45,747 thousand, with a significant rise in trade receivables aged 4 to 6 months Trade and Other Receivables (As of June 30) | Item | June 30, 2025 (RMB '000) | December 31, 2024 (RMB '000) | | :--- | :--- | :--- | | Trade and bills receivables | 41,380 | 26,136 | | Bills receivable from banks | 3,041 | 1,633 | | Other receivables | 1,326 | 1,860 | | Total | 45,747 | 29,629 | Ageing Analysis of Trade and Bills Receivables (As of June 30) | Ageing | June 30, 2025 (RMB '000) | December 31, 2024 (RMB '000) | | :--- | :--- | :--- | | Within 1 month | 4,561 | 9,460 | | 1 to 3 months | 6,225 | 9,222 | | 4 to 6 months | 30,594 | 7,454 | | Total | 41,380 | 26,136 | - Trade receivables aged 4 to 6 months significantly increased from RMB7,454 thousand as of December 31, 2024, to RMB30,594 thousand as of June 30, 2025, indicating a potential extension of the collection period[39] 13. Trade and Other Payables Total trade and other payables were RMB82,502 thousand, with the majority of trade payables aged over 3 months Trade and Other Payables (As of June 30) | Item | June 30, 2025 (RMB '000) | December 31, 2024 (RMB '000) | | :--- | :--- | :--- | | Trade payables | 27,916 | 31,633 | | Contract liabilities | 14,126 | 14,522 | | Accrued interest on other borrowings | 3,156 | 3,455 | | Other accrued expenses | 2,417 | 3,414 | | Staff-related costs payable | 9,908 | 9,827 | | Other payables | 24,979 | 20,189 | | Total | 82,502 | 83,040 | Ageing Analysis of Trade Payables (As of June 30) | Ageing | June 30, 2025 (RMB '000) | December 31, 2024 (RMB '000) | | :--- | :--- | :--- | | Within 1 month | 1,121 | 3,373 | | 1 to 3 months | 1,624 | 1,853 | | Over 3 months | 25,171 | 26,407 | | Total | 27,916 | 31,633 | - Trade payables aged over 3 months constitute the vast majority of total trade payables, indicating a longer payment cycle to suppliers[41] 14. Repayment Arrangement Scheme Liabilities The Group initiated a debt repayment arrangement scheme on March 12, 2024, involving initial and annual cash payments to scheme creditors and potential new share issuance - The debt repayment arrangement scheme became effective on March 12, 2024, fully discharging and releasing all unsecured and non-priority claims[43] - Scheme creditors are entitled to an initial cash payment equivalent to 1% of their admitted claims, and annual cash payments from 2024 to 2028 (HK$5 million for 2024, and HK$10 million annually from 2025-2028, or a relevant proportion of the audited consolidated net profit for the respective financial year, whichever is higher)[43] - During the six months ended June 30, 2025, the initial cash payment and the 2024 annual payment were made to the scheme creditors[44] 15. Share Capital The company's authorized and issued and fully paid share capital remained unchanged as of June 30, 2025 Share Capital Information (As of June 30) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Number of authorized shares (thousand shares) | 5,000,000 | 5,000,000 | | Authorized share capital (HK$'000) | 5,000 | 5,000 | | Number of issued and fully paid shares (thousand shares) | 1,474,993 | 1,474,993 | | Nominal value of issued and fully paid share capital (HK$'000) | 1,475 | 1,475 | | Carrying value of issued and fully paid share capital (RMB '000) | 1,216 | 1,216 | 16. Contingent Liabilities The Group faces a legal claim of RMB4,656 thousand for a construction design contract, with management deeming the plaintiff's success probability as remote - The Group's subsidiary, Chengdu Yiming Investment Management Co., Ltd., faces a legal claim of approximately RMB4,656 thousand for a construction design contract balance[46] - Based on independent legal advice, the Group's management considers the probability of the plaintiff succeeding to be remote[46] Management Discussion and Analysis This section provides management's discussion and analysis of the group's business, financial performance, liquidity, and future outlook Business Review The Group continues to focus on pharmaceutical distribution and manufacturing businesses in China - The Group remains committed to its pharmaceutical distribution and manufacturing businesses in China[47] Revenue Total revenue for the six months ended June 30, 2025, was RMB48.7 million, a slight decrease of approximately 0.28% Total Revenue (For the six months ended June 30) | Indicator | 2025 (RMB million) | 2024 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Total Revenue | 48.7 | 48.8 | -0.28% | Cost of Sales, Gross Profit and Gross Margin Cost of sales increased by 8.09% to RMB42.5 million, leading to a 34.8% decrease in gross profit and a drop in gross margin to 12.8% Cost of Sales, Gross Profit and Gross Margin (For the six months ended June 30) | Indicator | 2025 (RMB million) | 2024 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Cost of sales | 42.5 | 39.3 | +8.09% | | Gross profit | 6.2 | 9.5 | -34.80% | | Gross margin | 12.8% | 19.5% | -6.7 percentage points | - The increase in cost of sales was primarily due to rising costs of raw materials and labor[49] - The decrease in gross margin was mainly attributable to rising costs and intense competition in the pharmaceutical distribution industry[49] Other Income and Other Losses – Net Other net losses significantly reduced to RMB1.6 million, primarily due to changes in impairment losses Other Losses – Net (For the six months ended June 30) | Indicator | 2025 (RMB million) | 2024 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Other losses – net | 1.6 | 6.4 | -75.00% | - Other net losses primarily comprise impairment losses on trade and other receivables, and prepayments and deposits paid[50] Selling and Distribution Expenses Selling and distribution expenses decreased by 30.3% to RMB2.4 million, due to strict cost control and reduced sales activities Selling and Distribution Expenses (For the six months ended June 30) | Indicator | 2025 (RMB million) | 2024 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Selling and distribution expenses | 2.4 | 3.4 | -30.30% | - The decrease in expenses was attributable to the Group's stringent cost control policies and reduced sales activities and promotions during the review period[51] General and Administrative Expenses General and administrative expenses decreased by 21.6% to RMB5.7 million, as prior period legal and professional fees for resuming trading and debt restructuring did not recur General and Administrative Expenses (For the six months ended June 30) | Indicator | 2025 (RMB million) | 2024 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | General and administrative expenses | 5.7 | 7.3 | -21.92% | - The decrease in expenses was mainly due to the absence of legal and professional fees incurred in the prior period of 2024 for handling the application for resumption of trading and debt restructuring[52] Finance Costs Finance costs increased by 23.2% to RMB6.3 million, primarily due to increased imputed interest on repayment obligations under the debt repayment arrangement scheme Finance Costs (For the six months ended June 30) | Indicator | 2025 (RMB million) | 2024 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Finance costs | 6.3 | 5.1 | +23.53% | - The increase in finance costs was mainly due to imputed interest on repayment obligations under the debt repayment arrangement scheme for the six months ended June 30, 2025[53] (Loss)/Profit for the Period The Group shifted from a profit of RMB35.5 million to a loss of RMB9.1 million, primarily due to the absence of a one-off debt restructuring gain (Loss)/Profit for the Period (For the six months ended June 30) | Indicator | 2025 (RMB million) | 2024 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | (Loss)/Profit for the period | (9.1) | 35.5 | -125.63% | - The Group turned from profit to loss for the period mainly due to a one-off gain of RMB47.4 million from debt restructuring in the prior period of 2024, with no such gain in 2025[54] Future Prospects The company anticipates a market demand rebound and increased competition, focusing on enhancing production and distribution capabilities to seize opportunities - Market demand is expected to rebound, but market competitors will also increase[55] - Management will focus on enhancing production and distribution capabilities to capitalize on business opportunities arising from market recovery[55] Liquidity, Financial and Capital Resources Cash and cash equivalents significantly decreased, net current liabilities increased, and the current ratio declined, indicating heightened liquidity pressure, with changes in bank and other borrowings Liquidity and Borrowing Status (As of June 30) | Indicator | June 30, 2025 (RMB million) | December 31, 2024 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Cash and cash equivalents | 3.6 | 16.0 | -77.50% | | Net current liabilities | 29.5 | (1.3) | -2369.23% | | Current ratio | 0.75 | 1.01 | -25.74% | | Total bank borrowings | 16.4 | 11.4 | +43.86% | | Total other borrowings | 23.6 | 32.6 | -27.59% | - On May 25, 2025, 100,000,000 share options lapsed and expired, with no outstanding share options as of June 30, 2025[57] - The Group regularly and actively reviews and manages its capital structure to strengthen its financial position, with no changes in capital management approach[57] Contingent Liabilities The Group had no other significant contingent liabilities apart from the legal proceedings disclosed in Note 16 to the financial statements - The Group had no other significant contingent liabilities apart from those disclosed in Note 16 to the condensed consolidated interim financial statements[58] Exchange Rate Risk The Group does not face any significant foreign exchange risk as most assets, transactions, and operations are denominated in RMB - The majority of the Group's assets and transactions are denominated in RMB, and it does not face any significant foreign exchange risk[59] Other Information This section covers other relevant information, including significant investments, human resources, dividends, corporate governance, and share-related matters Significant Investments, Acquisitions and Disposals The Group did not undertake any discloseable significant investments, acquisitions, or disposals during the six months ended June 30, 2025 - The Group did not undertake any discloseable significant investments, acquisitions, or disposals during the reporting period[60] Human Resources The Group's headcount increased to 106, with slightly decreased total staff costs, focusing on attracting, developing, and retaining talent Human Resources Overview (As of June 30) | Indicator | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total headcount | 106 | 97 | | Total staff costs (RMB million) | 3.1 | 3.4 | - The Group considers human resources as its valuable asset and is committed to attracting, developing, and retaining outstanding employees[61] Dividends The Board does not recommend the payment of any interim dividend for the six months ended June 30, 2025 - The Board does not recommend the payment of any interim dividend for the six months ended June 30, 2025[62] Corporate Governance The company maintains high corporate governance standards, complying with the Listing Rules' Corporate Governance Code, except for the non-renewal of directors' and officers' liability insurance - The Company has adopted the Corporate Governance Code as set out in Appendix C1 Part 2 of the Listing Rules[63] - Following the expiry of the previous directors' and officers' liability insurance on December 6, 2024, the Company has not made any new insurance arrangements for potential legal actions against its directors[63] Audit Committee The Audit Committee, composed of three independent non-executive directors, reviewed the Group's accounting principles, internal controls, and financial reporting matters - The Audit Committee comprises Ms. Li Yan (Chairperson), Professor Lou Zhenye, and Mr. Wang Dongyuan[65] - The Audit Committee has reviewed the accounting principles and practices adopted by the Group and discussed internal control and financial reporting matters[65] Compliance with the Model Code for Securities Transactions by Directors of Listed Issuers The company adopted the Model Code in Appendix C3 of the Listing Rules, and all directors confirmed compliance during the reporting period - All Directors have confirmed their compliance with the relevant provisions of the Model Code for the six months ended June 30, 2025[66] Share Option Scheme The 2015 share option scheme expired on May 25, 2025, with all 100,000,000 granted options lapsing and no new options granted, exercised, or cancelled - The share option scheme expired on May 25, 2025[67] - For the six months ended June 30, 2025, all 100,000,000 share options lapsed, and no share options were granted, exercised, or cancelled during the period[68][72] - The Company will consider adopting a new share option scheme in due course in compliance with the latest requirements under Chapter 17 of the Listing Rules[74] Directors' and Chief Executive's Interests and Short Positions in Shares, Underlying Shares and Debentures of the Company or any Associated Corporation As of June 30, 2025, no directors or chief executives held discloseable interests or short positions in the company's or its associated corporations' shares, underlying shares, or debentures - As of June 30, 2025, no Directors or chief executives of the Company had any discloseable interests or short positions in the shares, underlying shares, or debentures of the Company or its associated corporations[76] Directors' Right to Acquire Shares or Debentures No rights were granted to any director or their associates to acquire benefits by purchasing company shares or debentures, nor were any such rights exercised - During the reporting period, no rights were granted to any Director or their associates to acquire benefits by means of purchasing shares or debentures of the Company, nor were any such rights exercised[77] Substantial Shareholders' and Other Persons' Interests and Short Positions in Shares and Underlying Shares of the Company As of June 30, 2025, Joyful Treasure Limited and Mr. Chen Yanfei were substantial shareholders, holding 51.97% of shares, with other significant interests held by Win Win Stable No. 3 Fund SP and related parties Substantial Shareholders' Long Positions in Shares (As of June 30) | Shareholder Name | Capacity/Nature of Interest | Number of Shares Held | Approximate Percentage of Issued Share Capital | | :--- | :--- | :--- | :--- | | Joyful Treasure Limited | Beneficial owner | 753,040,000 | 51.05% | | Mr. Chen Yanfei | Interest of controlled corporation | 753,040,000 | 51.05% | | Mr. Chen Yanfei | Beneficial owner | 13,560,000 | 0.92% | | Mr. Chen Yanfei Total | | 766,600,000 | 51.97% | Other Persons' Long Positions in Shares (As of June 30) | Shareholder Name | Capacity/Nature of Interest | Number of Shares Held | Approximate Percentage of Issued Share Capital | | :--- | :--- | :--- | :--- | | Win Win Stable No. 3 Fund SP | Person with a security interest in shares | 753,040,000 | 51.05% | | Zhongtai Innovation Capital Management Limited | Investment manager | 753,040,000 | 51.05% | | Ma Demin | Agent | 753,040,000 | 51.05% | | Lai Wing Lun | Agent | 753,040,000 | 51.05% | - 753,040,000 shares (approximately 51.05% of the issued share capital) held by Joyful Treasure Limited are pledged, with Mr. Ma Demin and Mr. Lai Wing Lun of RSM Corporate Advisory (Hong Kong) Limited appointed as joint and several receivers and managers[81] Purchase, Sale or Redemption of Listed Securities Neither the company nor its subsidiaries purchased, sold, or redeemed any of the company's listed securities during 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 during the reporting period[82] Changes in Directors' Information Independent Non-Executive Director Mr. Xu Qilin retired, while Mr. Wang Dongyuan and Professor Lou Zhenye were appointed to new committee roles, with Mr. Wang also resigning from another directorship - Independent Non-Executive Director Mr. Xu Qilin retired on June 26, 2025[83] - Independent Non-Executive Director Mr. Wang Dongyuan was appointed as Chairman of the Nomination Committee and a member of the Audit and Remuneration Committees[83] - Independent Non-Executive Director Professor Lou Zhenye was appointed as a member of the Nomination and Corporate Governance Committees[83] Company's Registered Office The company's registered office service provider in the Cayman Islands terminated services on July 22, 2025, and the Board is seeking a new provider - The Company's registered office service provider in the Cayman Islands terminated its services on July 22, 2025[84] - The Board is currently seeking another service provider to provide registered office services as soon as possible[84] Events After the Reporting Period The Board is not aware of any significant events occurring after June 30, 2025, up to the date of this interim report - The Board is not aware of any significant events occurring after June 30, 2025, up to the date of this interim report[85]