李氏大药厂(00950) - 2023 - 中期业绩

Financial Summary The overall financial performance for H1 2023 showed a decline in key metrics including revenue, profit, and interim dividend Overview of Financial Summary Lee's Pharmaceutical's revenue, gross profit, profit attributable to owners, and EPS decreased, along with a reduced interim dividend for H1 2023 Financial Summary for the Six Months Ended June 30 | Indicator | 2023 (HK$ Thousand) | 2022 (HK$ Thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 512,308 | 649,166 | -21.1% | | Gross Profit | 284,463 | 419,478 | -32.2% | | Profit Attributable to Owners of the Company | 16,117 | 28,460 | -43.4% | | Earnings Per Share (Basic) | 2.74 HK Cents | 4.83 HK Cents | -43.3% | | Earnings Per Share (Diluted) | 2.74 HK Cents | 4.83 HK Cents | -43.3% | | Interim Dividend Per Share | 0.80 HK Cents | 1.00 HK Cents | -20.0% | Business Review The business review highlights revenue decline, R&D focus, manufacturing upgrades, pipeline progress, new product approvals, enhanced sales, and a challenging outlook Revenue and Profit H1 2023 revenue decreased by 21.1% to HK$512.3 million due to license expirations and RMB depreciation, with gross margin falling to 55.5% despite some product growth - The Group's H1 2023 revenue was HK$512,308,000, a 21.1% decrease year-on-year, primarily due to product license expirations, declining sales, and RMB depreciation[25] - Gross profit was HK$284,463,000, a 32.2% decrease year-on-year. Overall gross profit margin was 55.5%, down 9.1 percentage points from 64.6% in H1 2022, mainly due to a shift towards lower-margin generic products[27] Major Product Sales Growth in H1 2023 | Product Name | Growth Rate (%) | | :--- | :--- | | Fepril® | 39.6% | | Breadyne™ | 43.4% | | Sancuso® | 197.4% | | Tratek® | 176.3% | | Fondaparinux Sodium Injection | 584.1% | | Sodium Phenylbutyrate Granules | 83.5% | - Profit attributable to owners of the company was HK$16,117,000, a 43.4% decrease compared to H1 2022[28] Research and Development H1 2023 R&D expenses decreased by 45.0% to HK$113.6 million, representing 22.2% of revenue, due to strategic project selection and cost optimization H1 2023 R&D Expenses | Indicator | H1 2023 (HK$ Thousand) | H1 2022 (HK$ Thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Total R&D Expenses | 113,634 | 206,517 | -45.0% | | % of Revenue | 22.2% | 31.8% | -9.6 percentage points | | Recognized as Expense | 48,798 | 116,590 | -58.1% | | Capitalized as Intangible Assets | 64,836 | 89,927 | -27.8% | - The decrease in R&D expenses resulted from strategically selecting new projects after the completion of previous ones and continuously optimizing resource allocation for priority R&D projects to reduce costs[8] Manufacturing Facilities and Production Capacity The Group aims to increase production and save costs, with Hefei and Nansha bases completing facility upgrades and process enhancements - The Group's primary objectives are to increase production output while implementing cost-saving measures to adapt to the evolving market environment[10] - - Hefei Base: Completed capacity enhancement and process scale-up facility upgrades for Yujingan®, co-line facility upgrades for new pre-filled syringe products before launch, and registration batch production for new oral lyophilized powder dosage forms[29][30] - - Nansha Base: Process scale-up equipment for aerosol inhalants has been installed and commissioned, with trial production expected shortly; production process upgrades for oral antihypertensive products are progressing well, with three pilot tests completed[29][30] Drug Development The Group has over 40 drug development projects across multiple therapeutic areas, with several late-stage programs showing positive progress - The Group's pipeline includes over 40 projects at various early to late development stages[31] - - Cetraxal® Plus: New Drug Application (NDA) for acute otitis externa and acute otitis media with tympanostomy tubes was submitted to CDE and accepted in January 2023[11] - - Intrarosa®: Currently in Phase III clinical trials for vulvovaginal atrophy, with the clinical database locked and unblinded, and data expected to be published soon[11] - - Fentanyl Aerosol Inhaler: Phase IIa clinical trial successfully met its primary endpoints in August 2023, with results to accelerate NDA review and approval[11] Oncology Pipeline COF, the Group's oncology R&D branch, has a pipeline of 10 assets, including Socazolimab and other novel drug candidates in various clinical stages - China Oncology Focus Limited (COF), the Group's R&D branch in oncology, has established a pipeline of 10 oncology assets, comprising 6 innovative drugs and 4 generic drugs[32] - - Socazolimab (anti-PD-L1 antibody): New Drug Application (NDA) stage for recurrent or metastatic cervical cancer in China; Phase III clinical trial for osteosarcoma; Phase III clinical trial for small cell lung cancer combined with chemotherapy has completed patient enrollment[32][33] - - Zotiraciclib: An oral multi-kinase inhibitor, currently in Phase I clinical trials for glioblastoma[32][33] - - Gemcitabine: A topoisomerase I inhibitor, currently in Phase II clinical trials for ovarian cancer, Phase Ib/II clinical trials for small cell lung cancer, and Phase I clinical trials for pancreatic cancer in China[32][33] - - Socazolimab combined with Pexa-vec (oncolytic virus): Currently in Phase Ib clinical trials for melanoma[32][33] New Product Approvals The Group secured two NMPA approvals, including INOmax DSIR Plus Delivery System™ and Apremilast Tablets, with the latter launching in Q4 2023 - The Group has obtained two registration approvals from the National Medical Products Administration ("NMPA")[14] - - INOmax DSIR Plus Delivery System™: Obtained NMPA's national medical device registration certificate on May 25, 2023, for treating term and near-term infants (≥34 weeks gestation) with hypoxic respiratory failure associated with pulmonary hypertension[35][143] - - Apremilast Tablets: Approved for registration by NMPA on June 14, 2023, for adult patients with moderate to severe plaque psoriasis eligible for phototherapy or systemic therapy, expected to launch in Q4 2023[35][143] Sales and Marketing The Group enhanced sales and marketing, focusing on market access, with several products, including rare disease drugs, newly added to China's NRDL - The Group has significantly strengthened its sales and marketing capabilities in recent years, with market access becoming a crucial aspect, implementing various steps to empower the market access team within China's complex healthcare landscape[15] - The Group's commercialized products, Treprostinil Injection, Teglutik®, and Tratek®, were newly included in China's National Reimbursement Drug List (NRDL), bringing the total to nine products in the latest NRDL edition to date[16][50] - As of 2023, the Group has two newly approved products, with two more new drug applications expected to be approved by year-end, which, combined with seven products approved in 2022, will generate new revenue streams in the near future[51] Outlook The Group anticipates a challenging H2 2023 due to competition, market changes, reduced margins, and rising costs, responding with cost-saving measures and efficiency optimization - - Market Environment Challenges: Intensified competition, evolving market dynamics, reduced profit margins for products included in the National Reimbursement Drug List (NRDL) or National Centralized Drug Procurement program, rising operating costs, and inflationary pressures[37][38] - - Response Strategy: The Group will continue to steadfastly implement cost-saving measures across all operational levels, prioritizing efficiency and resource optimization to ensure sustainable profitability[37][38] Interim Financial Statements This section presents the condensed consolidated financial statements, including statements of profit or loss, comprehensive income, financial position, changes in equity, and cash flows Condensed Consolidated Statement of Profit or Loss H1 2023 revenue was HK$512.3 million, with gross profit of HK$284.5 million and profit attributable to owners of HK$16.1 million Condensed Consolidated Statement of Profit or Loss (For the Six Months Ended June 30) | Indicator | 2023 (HK$ Thousand) | 2022 (HK$ Thousand) | | :--- | :--- | :--- | | Revenue | 512,308 | 649,166 | | Cost of Sales | (227,845) | (229,688) | | Gross Profit | 284,463 | 419,478 | | Other Income | 40,949 | 45,702 | | Net Other Gains and Losses | (5,736) | (5,227) | | Selling and Distribution Expenses | (146,931) | (176,215) | | Administrative Expenses | (90,584) | (111,075) | | Provision for Expected Credit Losses on Financial Assets | (296) | (253) | | Research and Development Expenses | (48,798) | (116,590) | | Operating Profit | 33,067 | 55,820 | | Finance Costs | (5,439) | (3,499) | | Share of Results of Associates | (440) | (526) | | Profit Before Tax | 27,188 | 51,795 | | Taxation | (6,279) | (24,713) | | Profit for the Period | 20,909 | 27,082 | | Profit Attributable to Owners of the Company | 16,117 | 28,460 | | Non-controlling Interests | 4,792 | (1,378) | Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income H1 2023 profit for the period was HK$20.9 million, with total comprehensive income of HK$59.4 million, driven by fair value changes and exchange differences Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (For the Six Months Ended June 30) | Indicator | 2023 (HK$ Thousand) | 2022 (HK$ Thousand) | | :--- | :--- | :--- | | Profit for the Period | 20,909 | 27,082 | | Other Comprehensive (Expense) / Income: | | | | - Exchange differences on translation of financial statements of overseas subsidiaries | (48,217) | (49,811) | | - Fair value changes of financial assets at fair value through other comprehensive income | 86,690 | (291,865) | | Other Comprehensive Income / (Expense) for the Period, Net of Tax | 38,473 | (341,676) | | Total Comprehensive Income / (Expense) for the Period | 59,382 | (314,594) | | Total Comprehensive Income / (Expense) for the Period Attributable to: | | | | Owners of the Company | 55,214 | (310,998) | | Non-controlling Interests | 4,168 | (3,596) | Condensed Consolidated Statement of Financial Position As of June 30, 2023, total assets increased to HK$2.9 billion, driven by non-current assets and increased inventories, while total liabilities reached HK$1 billion due to higher borrowings Condensed Consolidated Statement of Financial Position (As of June 30, 2023) | Indicator | June 30, 2023 (HK$ Thousand) | December 31, 2022 (HK$ Thousand) | | :--- | :--- | :--- | | Non-current Assets | | | | Property, Plant and Equipment | 495,148 | 540,665 | | Intangible Assets | 1,035,691 | 1,023,494 | | Financial Assets at Fair Value Through Other Comprehensive Income | 625,208 | 536,452 | | Total Non-current Assets | 2,190,878 | 2,130,394 | | Current Assets | | | | Inventories | 325,092 | 249,222 | | Trade Receivables | 120,072 | 111,278 | | Cash and Bank Balances | 161,519 | 189,301 | | Total Current Assets | 706,868 | 651,634 | | Current Liabilities | | | | Trade Payables | 115,269 | 101,301 | | Bank and Other Borrowings | 108,883 | 76,727 | | Total Current Liabilities | 704,766 | 650,104 | | Non-current Liabilities | | | | Bank and Other Borrowings | 77,363 | 77,363 | | Deferred Tax Liabilities | 71,012 | 73,897 | | Total Non-current Liabilities | 296,367 | 289,400 | | Total Equity | | | | Equity Attributable to Owners of the Company | 1,974,028 | 1,924,107 | | Non-controlling Interests | (77,415) | (81,583) | | Total Equity | 1,896,613 | 1,842,524 | Condensed Consolidated Statement of Changes in Equity Equity attributable to owners increased to HK$1.97 billion by June 30, 2023, driven by profit and fair value changes, despite dividend payments - Equity attributable to owners of the company increased to HK$1,974,028 thousand as of June 30, 2023, from HK$1,924,107 thousand on January 1, 2023[136] - - Profit for the period contributed HK$16,117 thousand[136] - - Fair value changes of financial assets at fair value through other comprehensive income resulted in a gain of HK$86,917 thousand[136] - - Payment of 2022 final dividend amounted to HK$5,888 thousand[136] Condensed Consolidated Statement of Cash Flows H1 2023 net cash from operations significantly decreased to HK$39.1 million, with net cash used in investing at HK$88.6 million, resulting in a period-end cash balance of HK$161.5 million Condensed Consolidated Statement of Cash Flows (For the Six Months Ended June 30) | Indicator | 2023 (HK$ Thousand) | 2022 (HK$ Thousand) | | :--- | :--- | :--- | | Net Cash Generated from Operating Activities | 39,063 | 252,218 | | Net Cash Used in Investing Activities | (88,587) | (116,475) | | Net Cash Generated from / (Used in) Financing Activities | 20,742 | (50,549) | | Net (Decrease) / Increase in Cash and Cash Equivalents | (28,782) | 85,194 | | Cash and Cash Equivalents at June 30 | 161,519 | 368,047 | Notes to the Unaudited Condensed Consolidated Financial Statements This section provides detailed notes on the unaudited condensed consolidated financial statements, covering accounting policies, segment data, and various financial components Basis of Preparation and Principal Accounting Policies The unaudited condensed consolidated financial statements are prepared under HKAS 34 and Listing Rules, with new HFRS amendments having no material impact - The unaudited condensed consolidated financial statements are prepared in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting" issued by the Hong Kong Institute of Certified Public Accountants (HKICPA) and the applicable disclosure requirements of Appendix 16 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[62] - Certain amendments to Hong Kong Financial Reporting Standards issued by the HKICPA, mandatory for annual periods beginning on or after January 1, 2023, were first applied in this reporting period but had no significant impact on the amounts presented and/or disclosures contained in these unaudited condensed consolidated financial statements[47] Segment Information The Group's segments are "Proprietary and Generic Products" and "In-licensed Products," with H1 2023 showing growth in the former and decline in the latter, and over 90% of revenue from China - The Group's reportable and operating segments are "Proprietary and Generic Products" (manufacturing and sales of self-developed and generic drugs) and "In-licensed Products" (trading of in-licensed drugs)[49][66][82] - For the six months ended June 30, 2023 and 2022, over 90% of the Group's revenue was derived from operations in the People's Republic of China, thus no geographical information on revenue is presented[69] Segment Revenue and Results H1 2023 saw proprietary and generic product revenue grow to HK$272.1 million, while in-licensed product revenue significantly dropped to HK$240.2 million Segment Revenue and Results (For the Six Months Ended June 30) | Segment | 2023 Revenue (HK$ Thousand) | 2022 Revenue (HK$ Thousand) | 2023 Operating Results (HK$ Thousand) | 2022 Operating Results (HK$ Thousand) | | :--- | :--- | :--- | :--- | :--- | | Proprietary and Generic Products | 272,091 | 252,087 | 58,978 | 85,948 | | In-licensed Products | 240,217 | 397,079 | 35,889 | 105,795 | | Consolidated Total | 512,308 | 649,166 | 94,867 | 191,743 | - Research and development expenses for the Proprietary and Generic Products segment were HK$16,713 thousand (2022: HK$30,915 thousand), and for the In-licensed Products segment were HK$32,085 thousand (2022: HK$85,675 thousand)[67] Segment Assets and Liabilities and Geographical Information As of June 30, 2023, total assets were HK$2.9 billion and total liabilities were HK$1 billion, with China accounting for a significant portion Segment Assets and Liabilities (As of June 30, 2023) | Segment | June 30, 2023 Assets (HK$ Thousand) | December 31, 2022 Assets (HK$ Thousand) | June 30, 2023 Liabilities (HK$ Thousand) | December 31, 2022 Liabilities (HK$ Thousand) | | :--- | :--- | :--- | :--- | :--- | | Proprietary and Generic Products | 779,089 | 726,742 | 226,069 | 176,617 | | In-licensed Products | 1,311,250 | 1,311,699 | 370,580 | 398,145 | | Consolidated Total | 2,897,746 | 2,782,028 | 1,001,133 | 939,504 | Geographical Assets and Liabilities (As of June 30, 2023) | Region | June 30, 2023 Assets (HK$ Thousand) | December 31, 2022 Assets (HK$ Thousand) | June 30, 2023 Liabilities (HK$ Thousand) | December 31, 2022 Liabilities (HK$ Thousand) | | :--- | :--- | :--- | :--- | :--- | | China | 1,708,843 | 1,696,915 | 444,703 | 406,734 | | Hong Kong and Others | 1,188,903 | 1,085,113 | 556,430 | 532,770 | | Total | 2,897,746 | 2,782,028 | 1,001,133 | 939,504 | Other Income H1 2023 other income decreased to HK$40.9 million, primarily from development grants and rental income, while R&D service income significantly declined Other Income Details (For the Six Months Ended June 30) | Income Category | 2023 (HK$ Thousand) | 2022 (HK$ Thousand) | | :--- | :--- | :--- | | Interest Income from Bank Deposits | 662 | 1,183 | | Development and Government Grants | 26,179 | 17,094 | | Rental and Utility Income | 7,525 | 5,997 | | Research and Development Service Income | 4,067 | 19,220 | | Miscellaneous Income | 2,516 | 2,208 | | Total | 40,949 | 45,702 | - The Group received development grants from local governments in recognition of its performance and development of high-tech pharmaceutical products[85] Profit Before Tax H1 2023 profit before tax was calculated after deducting HK$77.7 million in depreciation and amortization, HK$4.6 million in interest, and HK$0.6 million in share-based payments Profit Before Tax Deductions (For the Six Months Ended June 30) | Item | 2023 (HK$ Thousand) | 2022 (HK$ Thousand) | | :--- | :--- | :--- | | Depreciation of Property, Plant and Equipment (including right-of-use assets) | 49,601 | 60,606 | | Amortization of Intangible Assets | 28,146 | 17,930 | | Total Depreciation and Amortization | 77,747 | 78,536 | | Interest Expense on Borrowings | 4,594 | 2,513 | | Interest Expense on Lease Liabilities | 361 | 226 | | Share-based Payments | 595 | 6,349 | | - Directors | 186 | 4,441 | | - Employees | 409 | 1,908 | Taxation H1 2023 total taxation significantly decreased to HK$6.3 million, with Hong Kong profits tax on a two-tiered system and a deferred tax credit Taxation Details (For the Six Months Ended June 30) | Tax Category | 2023 (HK$ Thousand) | 2022 (HK$ Thousand) | | :--- | :--- | :--- | | Current Tax: | | | | Hong Kong Profits Tax | 10,895 | 12,436 | | China Corporate Income Tax | – | 362 | | Under-provision in Prior Years: | | | | China Corporate Income Tax | 17 | – | | Deferred Tax (Credit) / Charge for Temporary Differences | (4,633) | 11,915 | | Total | 6,279 | 24,713 | - Hong Kong profits tax is calculated at 8.25% on the first HK$2 million of estimated assessable profits and 16.5% on profits above HK$2 million. Taxes arising in China are calculated at the prevailing local tax rates[72] Dividends The Board proposed an interim dividend of HK$0.008 per share, totaling HK$4.7 million, declared post-period and not recognized as a liability - The declared interim dividend is HK$0.008 per ordinary share (2022: HK$0.010), totaling HK$4,711 thousand[73] - This dividend was declared after the interim report date and therefore has not been recognized as a liability in the condensed consolidated statement of financial position[151] - The 2022 final dividend of HK$0.010 per share (totaling HK$5,888,000) was paid on June 15, 2023[151] Earnings Per Share H1 2023 basic and diluted EPS attributable to owners decreased to HK$0.0274, based on 588.8 million weighted average ordinary shares Earnings Per Share (For the Six Months Ended June 30) | Indicator | 2023 (HK Cents) | 2022 (HK Cents) | | :--- | :--- | :--- | | Basic Earnings Per Share | 2.74 | 4.83 | | Diluted Earnings Per Share | 2.74 | 4.83 | - Profit attributable to owners of the company for the purpose of calculating basic and diluted earnings per share was HK$16,117 thousand (2022: HK$28,460 thousand)[89] - The weighted average number of ordinary shares for the purpose of calculating basic earnings per share was 588,835 thousand shares[90] Property, Plant and Equipment and Intangible Assets H1 2023 saw additions of HK$13 million in right-of-use assets, HK$15 million in PPE, and HK$72 million in intangible assets, with no impairment recognized - - Additions to right-of-use assets amounted to approximately HK$13,000 thousand (2022: approximately HK$2,000 thousand)[108][109][110] - - Additions to owned property, plant and equipment amounted to approximately HK$15,000 thousand (2022: approximately HK$7,000 thousand)[108][109][110] - - Additions to intangible assets amounted to approximately HK$72,000 thousand (2022: approximately HK$90,000 thousand), which included patent fees and development costs[108][109][110] - No impairment provisions or write-offs for intangible assets were recognized in profit or loss for the six months ended June 30, 2022 and 2023[92] Interests in Associates As of June 30, 2023, interests in associates totaled HK$5.3 million, including Prolife Pharmaceutical and Zhihe Bio-Tech, engaged in drug development and radiopharmaceutical services Changes in Interests in Associates (As of June 30) | Item | 2023 (HK$ Thousand) | 2022 (HK$ Thousand) | | :--- | :--- | :--- | | At Beginning of Period / Year | 5,163 | 6,267 | | Additions | 605 | – | | Share of Post-acquisition Losses | (440) | (1,104) | | At End of Period / Year | 5,328 | 5,163 | Details of Principal Associates (As of June 30, 2023) | Associate Name | Place of Incorporation / Operation | Proportion of Ownership Interest Held by the Group | Principal Activities | | :--- | :--- | :--- | :--- | | Prolife Pharmaceutical Co., Limited | British Virgin Islands / Hong Kong | 33.92% | Development, manufacture and sale of pharmaceutical products | | Zhihe Bio-Tech Limited | Hong Kong / Hong Kong | 37.69% | Investment holding and operation of a central pharmacy for compound radiopharmaceuticals | Trade Receivables As of June 30, 2023, trade receivables increased to HK$120.1 million, with an average credit period of 30-120 days and most balances aged 0-30 days - The Group grants an average credit period of 30 to 120 days to its trade customers[94] Ageing Analysis of Trade Receivables (As of June 30) | Ageing | 2023 (HK$ Thousand) | 2022 (HK$ Thousand) | | :--- | :--- | :--- | | 0 to 30 Days | 73,519 | 55,268 | | 31 to 120 Days | 44,173 | 39,643 | | 121 to 180 Days | 1,619 | 9,057 | | 181 to 365 Days | 742 | 7,282 | | Over 365 Days and Within 3 Years | 19 | 28 | | Total | 120,072 | 111,278 | Trade Payables As of June 30, 2023, trade payables increased to HK$115.3 million, with an average credit period of 90 days and most balances aged 0-90 days - The average credit period for purchases of certain goods is 90 days[97] Ageing Analysis of Trade Payables (As of June 30) | Ageing | 2023 (HK$ Thousand) | 2022 (HK$ Thousand) | | :--- | :--- | :--- | | 0 to 90 Days | 64,300 | 75,204 | | 91 to 180 Days | 26,383 | – | | 181 to 365 Days | 107 | 26,037 | | Over 365 Days | 24,479 | 60 | | Total | 115,269 | 101,301 | Bank and Other Borrowings As of June 30, 2023, total bank and other borrowings were HK$186.2 million, with all bank borrowings classified as current due to demand clauses, at 6.00% to 7.03% interest Bank and Other Borrowings (As of June 30) | Borrowing Category | 2023 (HK$ Thousand) | 2022 (HK$ Thousand) | | :--- | :--- | :--- | | Secured Bank Borrowings Classified as Current Liabilities | 106,727 | 76,727 | | Unsecured Other Borrowings Classified as Current Liabilities | 2,156 | – | | Secured Bank Borrowings Classified as Non-current Liabilities | 77,363 | 77,363 | | Total | 186,246 | 154,090 | - Bank borrowings are classified entirely as current liabilities due to clauses granting the lenders an unconditional right to demand repayment at any time, in accordance with Hong Kong Interpretation 5[116] - The effective annual interest rates for the Group's bank and other borrowings ranged from 6.00% to 7.03% (December 31, 2022: 6.42% to 6.75%), denominated in Hong Kong Dollars and Renminbi[100][118] Share Capital As of June 30, 2023, authorized share capital was HK$50 million (1 billion shares), with issued and fully paid capital at HK$29.4 million (588.8 million shares) Share Capital Details (As of June 30) | Share Capital Category | Number of Shares as of June 30, 2023 | Share Capital as of June 30, 2023 (HK$ Thousand) | | :--- | :--- | :--- | | Authorized: Ordinary Shares of HK$0.05 Par Value Each | 1,000,000,000 | 50,000 | | Issued and Fully Paid: At Beginning and End of Period / Year | 588,835,343 | 29,442 | Related Party Transactions During the period, key management compensation totaled HK$12.6 million, and the Group donated HK$0.2 million to the Lee To Ching Fong Scholarship, a related party Key Management Personnel Compensation (For the Six Months Ended June 30) | Compensation Category | 2023 (HK$ Thousand) | 2022 (HK$ Thousand) | | :--- | :--- | :--- | | Short-term Employee Benefits | 9,382 | 8,541 | | Share-based Payments | 186 | 4,441 | | Retirement and Other Post-employment Benefits | 3,034 | 2,609 | | Total | 12,602 | 15,591 | - Donations to the Lee To Ching Fong Scholarship totaled HK$200,000 for the six months ended June 30, 2023 (2022: HK$1,900,000)[103] Capital Commitments and Pledged Assets As of June 30, 2023, capital commitments totaled HK$161.1 million for investments in financial assets, intangible assets, and PPE, with no pledged assets Contracted Capital Commitments (As of June 30) | Commitment Category | 2023 (HK$ Thousand) | 2022 (HK$ Thousand) | | :--- | :--- | :--- | | Investments in Financial Assets at Fair Value Through Other Comprehensive Income | 20,588 | 22,654 | | Intangible Assets - Patent Fees and Development Costs | 114,809 | 129,770 | | Property, Plant and Equipment | 25,744 | 79,295 | | Total | 161,141 | 231,719 | - No assets were pledged as of June 30, 2023, and December 31, 2022[104] Other Information This section provides additional information on the company's operations, including securities activities, dividend declarations, corporate governance, and board composition Purchase, Sale or Redemption of Listed Securities Neither the company nor its subsidiaries purchased, sold, or redeemed any listed securities during H1 2023 - For the six months ended June 30, 2023, neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities[128] Interim Dividend The Board recommended an interim dividend of HK$0.008 per share to shareholders registered by September 15, 2023 - The Board recommended an interim dividend of HK$0.008 per share (2022: HK$0.010) to shareholders registered in the company's register of members at the close of business on Friday, September 15, 2023[105] Closure of Register of Members The company will suspend its register of members from September 14-15, 2023, for interim dividend eligibility, with transfer documents due by September 13 - The company will suspend its register of members from Thursday, September 14, 2023, to Friday, September 15, 2023 (both days inclusive)[106] - To ensure eligibility for the interim dividend, all transfer documents, accompanied by the relevant share certificates, must be lodged with the company's Hong Kong share registrar by 4:30 p.m. on Wednesday, September 13, 2023[106] Corporate Governance Practices The company complied with the Listing Rules' Corporate Governance Code for H1 2023 and will continue to review practices for ongoing adherence - The company has complied with the Corporate Governance Code set out in Appendix 14 to the Listing Rules for the six months ended June 30, 2023[129] - The Board will continue to review the company's corporate governance practices from time to time to ensure compliance with the Corporate Governance Code[107] Publication of Financial Information The company will publish its H1 2023 interim report on the HKEX and company websites and dispatch it to shareholders - The company will dispatch its interim report for the six months ended June 30, 2023, to its shareholders and publish it on the website of The Stock Exchange of Hong Kong Limited (http://www.hkexnews.hk) and the company's website (http://www.leespharm.com) in due course[123] Board of Directors As of this announcement, the Board includes Executive Directors Ms. Lee Siu Fong (Chairman) and Ms. Lee Ye Ni, two Non-executive Directors, and three Independent Non-executive Directors - - Executive Directors: Ms. Lee Siu Fong (Chairman), Ms. Lee Ye Ni[124] - - Non-executive Directors: Dr. Li Xiao Yi, Mr. James Charles Gale[124] - - Independent Non-executive Directors: Dr. Chan Hau Chong, Ms. Chiang Kwai Wah, Dr. Jim Wah Keung[124]