Revenue and Profitability - The Group's revenue for the six months ended June 30, 2023, was RMB 257.1 million, a decrease from RMB 86.1 million in the same period of 2022[12]. - For the six months ended June 30, 2023, the Group's total revenue decreased by approximately RMB171.0 million, or approximately 66.5%, from approximately RMB257.1 million to approximately RMB86.1 million[31]. - Revenue from construction services decreased by approximately RMB135.7 million, or approximately 92.3%, from approximately RMB147.0 million to approximately RMB11.3 million[32]. - Revenue from equipment operation services decreased by approximately RMB34.3 million, or approximately 32.2%, from approximately RMB106.4 million to approximately RMB72.1 million[33]. - Gross profit for the same period was RMB 6,024,000, down 74.9% from RMB 24,086,000 in 2022[190]. - The Group's overall gross profit margin decreased by 2.4 percentage points, from 9.4% to 7.0%[43]. - Loss for the period increased to RMB 70,722,000, compared to a loss of RMB 36,824,000 in the previous year, representing a 91.9% increase[192]. - Loss before taxation was RMB 68,930,000, up from RMB 40,464,000 in 2022, indicating a 70.2% increase[190]. Financial Position and Ratios - The Group's gearing ratio increased to 24.6% as of June 30, 2023, compared to 17.3% at the end of 2022[16]. - Current ratio improved slightly to 1.6 as of June 30, 2023, from 1.5 at the end of 2022[16]. - The net current assets of the Group were approximately RMB 368.8 million as of June 30, 2023, representing a decrease of approximately RMB 5.4 million compared to RMB 374.2 million as of December 31, 2022[109]. - As of June 30, 2023, total net assets decreased to RMB 700,912,000 from RMB 771,974,000 as of December 31, 2022, representing a decline of approximately 9.1%[198]. - Current assets decreased to RMB 966,145,000 from RMB 1,147,451,000, a reduction of about 15.8%[198]. - Current liabilities decreased to RMB 597,391,000 from RMB 773,205,000, showing a decrease of approximately 22.7%[198]. - Loans and borrowings under non-current liabilities decreased to RMB 67,393,000 from RMB 103,246,000, a decline of about 34.7%[198]. - Cash and cash equivalents decreased to RMB 95,306,000 from RMB 149,817,000, a reduction of approximately 36.4%[198]. - Trade and other payables decreased to RMB 451,021,000 from RMB 549,108,000, reflecting a decrease of about 17.8%[198]. - Contract assets decreased to RMB 225,090,000 from RMB 280,659,000, a decline of approximately 19.8%[198]. - The total equity remained unchanged at RMB 700,912,000, indicating stability in capital and reserves despite fluctuations in other areas[198]. Cash Flow and Financing Activities - The Group's net cash used in financing activities increased from approximately RMB 110.4 million in the first half of 2022 to around RMB 129.2 million in the first half of 2023[25]. - The Group's financing activities net cash increased from approximately RMB 110.4 million to approximately RMB 129.2 million, reducing the debt amount as of June 30, 2023[27]. - Finance costs decreased from RMB 11.9 million for the six months ended June 30, 2022, to RMB 7.6 million for the same period in 2023, a reduction of RMB 4.3 million[98]. Impairment and Credit Risk - An impairment loss of RMB 43.0 million was recognized against the carrying amount of property, plant, and equipment, which was written down to a recoverable amount of RMB 340.7 million[96]. - The company reported an impairment loss on trade and other receivables of RMB 35,780,000, slightly down from RMB 36,375,000 in the previous year[190]. - The Group's credit risk is primarily attributable to trade receivables, bills receivable, and contract assets, with retention money potentially retained by customers to secure contract performance[55]. - The Group ceased tendering for construction projects with certain real estate developers to mitigate credit risk and has initiated legal actions against some subsidiaries of these developers[79]. Research and Development - Research and development costs decreased by approximately RMB8.1 million, from RMB11.5 million to RMB3.4 million, due to minimal research and development activities[49]. - Research and development expenses decreased significantly from RMB 11.5 million for the six months ended June 30, 2022, to RMB 3.4 million for the same period in 2023, reflecting a reduction in R&D activities[53]. Corporate Governance and Shareholding - The Board of Directors consists of three Executive Directors, three Non-executive Directors, and three Independent Non-executive Directors, ensuring a balanced governance structure[148]. - The Company has complied with all applicable code provisions of the Corporate Governance Code, except for the separation of the roles of Chairman and Chief Executive Officer[136]. - The company has a significant concentration of ownership, with the top two shareholders holding over 57% of the total shares[165]. - As of June 30, 2023, Mr. Xun MH holds 319,380,375 ordinary shares, representing 51.10% of the company's shareholding[165]. - Mr. Xun LB holds 41,419,719 ordinary shares, representing 6.63% of the company's shareholding[165]. - The company has undergone an independent review of its interim financial report by KPMG, in accordance with Hong Kong standards[178]. Other Financial Information - The Group's income tax expenses for the six months ended June 30, 2023, were approximately RMB 1.8 million, compared to an income tax credit of approximately RMB 3.6 million in 2022[99]. - The Group aims to improve liquidity while exploring new business opportunities to create long-term value for shareholders[29]. - The Group continues to manage its assets actively to improve its financial condition[27]. - The Group is focusing on improving its liquidity position by reducing capital expenditures and managing its assets effectively[24]. - The Group did not have any significant investments, material acquisitions, or disposals during the six months ended June 30, 2023[128].
建中建设(00589) - 2023 - 中期财报