[Company Information](index=2&type=section&id=%E5%85%AC%E5%8F%B8%E8%B3%87%E6%96%99) This section provides fundamental information about RoboSense, including its board of directors, committees, registration details, principal place of business, share registrar, auditor, legal counsel, company website, and principal bankers [Board of Directors and Committees](index=3&type=section&id=%E8%91%A3%E4%BA%8B%E6%9C%83%E5%8F%8A%E5%A7%94%E5%93%A1%E6%9C%83) This section lists RoboSense's board members and established committees, including Audit, Remuneration, Nomination, and ESG, along with their members - Board members include **Dr. Qiu Chunxin** (Chairman and Chief Scientist), **Mr. Liu Letian** (CTO), and **Mr. Qiu Chunchao** (CEO) as executive directors[4](index=4&type=chunk) - The company has an Audit Committee, Remuneration Committee, Nomination Committee, and Environmental, Social and Governance Committee to ensure a sound corporate governance structure[4](index=4&type=chunk) [Company Basic Information](index=3&type=section&id=%E5%85%AC%E5%8F%B8%E5%9F%BA%E6%9C%AC%E4%BF%A1%E6%81%AF) This section provides RoboSense's registration, principal business locations, share registrar, auditor, legal counsel, website, and main bankers - The company's registered office is in the Cayman Islands, with its China headquarters and principal place of business in Nanshan District, Shenzhen[4](index=4&type=chunk) - The principal place of business in Hong Kong changed effective **January 10, 2025**[6](index=6&type=chunk) - The auditor is **PricewaterhouseCoopers**, and the company website is **www.robosense.ai/en**[6](index=6&type=chunk) [CEO's Statement](index=5&type=section&id=%E9%A6%96%E5%B8%AD%E5%9F%B7%E8%A1%8C%E5%AE%98%E8%87%B4%E8%BE%AD) The CEO's statement highlights significant Q2 2025 revenue and LiDAR sales growth, especially in robotics, continuous gross margin improvement, and substantial net loss reduction [Q2 2025 Performance Overview](index=5&type=section&id=2025%E5%B9%B4%E7%AC%AC%E4%BA%8C%E5%AD%A3%E5%BA%A6%E6%A5%AD%E7%B8%BE%E6%A6%82%E8%A6%BD) The CEO's statement highlights significant Q2 2025 revenue and LiDAR sales growth, particularly explosive growth in robotics and other sectors, continuous gross margin improvement, and substantial net loss reduction Q2 2025 Key Financial and Operational Data | Metric | Amount/Quantity | YoY Growth | QoQ Growth | | :--- | :--- | :--- | :--- | | Revenue (RMB million) | 455 | 24.4% | 38.9% | | Total LiDAR Sales (units) | 158,200 | 28.6% | 45.7% | | Robotics & Other Sales (units) | 34,400 | 631.9% | 189.1% | | ADAS Sales (units) | 123,800 | 4.6% | 28.0% | | Gross Margin (%) | 27.7 | - | - | | ADAS Gross Margin (%) | 19.4 | - | - | | Robotics & Other Gross Margin (%) | 41.5 | - | - | | Net Loss Narrowed (%) | - | 63.6 | 49.6 | [Digital LiDAR Technology and Product Progress](index=5&type=section&id=%E6%95%B8%E5%AD%97%E5%8C%96%E6%BF%80%E5%85%89%E9%9B%B7%E9%81%94%E6%8A%80%E8%A1%93%E8%88%87%E7%94%A2%E5%93%81%E9%80%B2%E5%B1%95) LiDAR technology competition shifted to chips, with the company building a digital product matrix based on self-developed SPAD-SoC and VCSEL, expecting next-gen chips next year - LiDAR core technology competition has shifted from system opto-mechanical architecture innovation to deeper chip-level competition[10](index=10&type=chunk) - The company has built the industry's most comprehensive digital product matrix, primarily featuring E-platform and EM-platform, based on self-developed **SPAD-SoC chips** and **VCSEL architecture**[10](index=10&type=chunk) - Development of the next-generation digital chip is progressing smoothly, expected to launch next year, continuing to lead industry development[10](index=10&type=chunk) [Automotive and Robotaxi Market Expansion](index=5&type=section&id=%E8%BB%8A%E8%BC%89%E5%8F%8ARobotaxi%E5%B8%82%E5%A0%B4%E6%8B%93%E5%B1%95) E1 is the sole L3/L4 wide-angle LiDAR for mass production, EM platform secured 46 models from 8 OEMs, and E1/EM4 are preferred for next-gen Robotaxis with over 90% L4 partnerships - **E1** has become the sole choice for mass production of **L3 and L4 autonomous driving wide-angle LiDAR**[10](index=10&type=chunk) - The **EM platform** secured **46 models** from **8 OEMs** within six months, with rapid volume ramp-up expected in **2026**[10](index=10&type=chunk) - In the Robotaxi sector, the company has partnered with **over 90% of L4 leading enterprises**, with **E1 and EM4** officially designated by multiple global leading Robotaxi companies[11](index=11&type=chunk) [Breakthroughs in Robotics and Embodied AI](index=6&type=section&id=%E6%A9%9F%E5%99%A8%E4%BA%BA%E5%8F%8A%E5%85%B7%E8%BA%AB%E6%99%BA%E8%83%BD%E9%A0%98%E5%9F%9F%E7%AA%81%E7%A0%B4) Robotics saw breakthroughs with E1R, including seven-figure orders from TOP5 robotic lawnmower firms and deep partnerships in autonomous delivery; Active Camera launched as 'true eye of robots' for embodied AI - **E1R** and other robotic digital products performed outstandingly in the robotic lawnmower industry, achieving exclusive partnerships with several global **TOP5 manufacturers**, with order volumes reaching **seven figures**[11](index=11&type=chunk) - In the autonomous delivery sector, deep strategic partnerships were established with **Coco Robotics**, a leading North American delivery platform, and domestic leaders such as **Meituan, Neolix, and White Rhino**[11](index=11&type=chunk) - Launched the innovative **Active Camera**, positioned as "the true eye of robots," capable of outputting **RGBD information**, integrating camera, LiDAR, and IMU data, aiming to create an ecological closed-loop for dexterous robot operation[11](index=11&type=chunk)[12](index=12&type=chunk) [Future Outlook and Strategy](index=7&type=section&id=%E6%9C%AA%E4%BE%86%E5%B1%95%E6%9C%9B%E8%88%87%E6%88%B0%E7%95%A5) RoboSense aims to be a global robotics leader, increasing investment in chips, algorithms, and digital architecture to build stronger technological moats and create long-term value - The company is committed to becoming a global leading robotics company, with the mission of "making the world safer and life smarter"[14](index=14&type=chunk) - Future plans include continuous increased investment in **chips, algorithms, and digital architecture** to build stronger technological moats[14](index=14&type=chunk) [Key Financial and Operational Highlights](index=8&type=section&id=%E9%97%9C%E9%8D%B5%E8%B2%A1%E5%8B%99%E5%8F%8A%E9%81%8B%E7%87%9F%E4%BA%AE%E9%BB%9E) This section summarizes the company's key financial and operational performance, highlighting revenue growth, significant gross margin improvement, and narrowing losses, alongside increased LiDAR sales, market expansion, and technological innovations [Major Financial Highlights](index=8&type=section&id=%E4%B8%BB%E8%A6%81%E8%B2%A1%E5%8B%99%E4%BA%AE%E9%BB%9E) This section outlines key financial data for H1 2025, showing revenue growth, significant gross margin improvement, and narrowing losses Major Financial Data for the Six Months Ended June 30 | Metric | 2025 (Unaudited, RMB thousand) | 2024 (Unaudited, RMB thousand) | | :--- | :--- | :--- | | Revenue | 783,207 | 727,094 | | Gross Profit | 203,136 | 98,553 | | Gross Margin (%) | 25.9 | 13.6 | | Operating Loss | (197,149) | (322,070) | | Loss Attributable to Owners of the Company | (150,980) | (269,151) | | Total Assets (as of period end) | 4,936,017 | 4,139,138 | | Total Liabilities (as of period end) | 1,096,147 | 1,065,959 | | Total Equity

Corporate Information [Board of Directors](index=3&type=section&id=Board%20of%20Directors) The Board of Directors includes executive, non-executive, and independent non-executive directors, and committee leadership - Board members include Mr. Li Xuechun (Chairman), Ms. Zhang Weiping (Vice Chairman), Mr. Zuo Yichen, Mr. Lin Yilong (Executive Directors), Mr. Liang Xingchao, Ms. Li Yanping (Non-executive Directors), and Mr. Chen Yisheng, Mr. Yu Huangcheng, Mr. Wang Weihong (Independent Non-executive Directors)[5](index=5&type=chunk)[6](index=6&type=chunk) - Mr. Chen Yisheng chairs the Audit Committee, Mr. Wang Weihong chairs the Remuneration Committee, and Mr. Yu Huangcheng chairs the Nomination Committee[5](index=5&type=chunk)[6](index=6&type=chunk) [Company Information Details](index=3&type=section&id=Company%20Information%20Details) This section provides essential company information, including legal counsel, auditor, registered office, principal places of business, share registrar, and stock code - The company's legal counsel is Morgan Lewis & Bockius (Hong Kong Law), and its auditor is Ernst & Young[7](index=7&type=chunk) - The company's registered office is in the Cayman Islands, with its headquarters and principal place of business in mainland China located in Beijing, and its principal place of business in Hong Kong SAR located in Admiralty[7](index=7&type=chunk)[8](index=8&type=chunk) - The Hong Kong share registrar is Hong Kong Registrars Limited, the principal bankers are Industrial and Commercial Bank of China Chongqing Heyang Branch, and the stock code is 1569[9](index=9&type=chunk) Management Discussion and Analysis [Business Review](index=6&type=section&id=Business%20Review) The Group, a leading "Internet+" vocational education provider, offers integrated services across eight business segments, operating 10 schools with approximately 100,000 students - The Group has established eight major business segments, including campus education, online education services, vocational skills enhancement and training, human resources services, digital industry-education integration services, education informatization services, examination and assessment services, and international education services[10](index=10&type=chunk)[12](index=12&type=chunk) Group Operating Scale as of June 30, 2025 | Indicator | Quantity | | :--- | :--- | | Number of operated/managed schools | 10 schools (7 higher education institutions, 2 secondary vocational schools, 1 high school) | | Total enrolled students | Approximately 100,000 people | | Full-time undergraduate students | Approximately 61,000 people | | Number of learning centers | Over 1,900 (covering 31 provinces, municipalities, and autonomous regions nationwide) | | Partner institutions | Over 1,500 | | Human resources companies | Approximately 950 companies | | Employers | Approximately 44,000 companies | | Linked C-end users | Approximately 3.3 million people | | Job demands | Approximately 4.1 million positions | | Total scale of students and users served | Accumulated over 50 million | - During the reporting period, the company signed a revolving loan facility letter with CITIC Bank International Limited for up to **RMB 300 million**[13](index=13&type=chunk)[17](index=17&type=chunk) - The Group's institutions' enrollment plan for the 2025/2026 academic year increased significantly by approximately **24.0%**, with undergraduate program enrollment increasing by approximately **29.0%**[15](index=15&type=chunk)[17](index=17&type=chunk) [Future Outlook](index=7&type=section&id=Future%20Outlook) Supported by government policies, the Group will continue to advance high-quality higher education, optimize teaching environments and faculty, and build a digital "learning, employment, entrepreneurship" service platform ecosystem, accelerating the application of big data and AI in its operations to empower talent cultivation - The government has allocated **RMB 31.257 billion** to support the modern vocational education quality improvement plan, promoting the modernization and high-quality development of vocational education[16](index=16&type=chunk)[18](index=18&type=chunk) - The Group will continue to increase resource investment, optimize teaching environments and equipment, strengthen its professional teaching team, provide high-quality teaching services, and promote high-quality student employment[19](index=19&type=chunk)[21](index=21&type=chunk) - The Group will comprehensively advance the digitalization and intelligence of learning, employment, and entrepreneurship services, covering the entire chain from enrollment, assessment, teaching, examination, practical training, employment, to entrepreneurship[20](index=20&type=chunk)[22](index=22&type=chunk) - The Group will accelerate the widespread application of cutting-edge technologies such as big data and artificial intelligence in its business areas to empower education and talent development[23](index=23&type=chunk)[25](index=25&type=chunk) [Financial Review](index=9&type=section&id=Financial%20Review) Total revenue decreased by **17.1%** due to reduced online education, leading to a significant decline in profit for the period and adjusted net profit Key Financial Indicators Changes (Six Months Ended June 30) | Indicator | 2025 (RMB million) | 2024 (RMB million) | Change (%) | Primary Reason | | :--- | :--- | :--- | :--- | :--- | | Revenue | 894.8 | 1,079.8 | -17.1% | Decrease in online education revenue | | Cost of sales | 539.4 | 498.9 | +8.1% | Increase in depreciation, amortization, and staff costs | | Gross profit | 355.4 | 580.8 | -38.8% | Increase in campus education expenses | | Gross profit margin | 39.7% | 53.8% | -14.1% | Increase in campus education expenses | | Other income and gains | 55.8 | 71.5 | -22.1% | Decrease in short-term investment income | | Selling expenses | 54.3 | 98.0 | -44.6% | Decrease in sales and marketing staff salaries and promotion costs | | Administrative expenses | 196.2 | 240.3 | -18.4% | Effective control of administrative expenses | | Other expenses, net | 22.3 | 59.7 | -62.6% | Significant decrease in impairment losses on financial assets | | Finance costs | 67.4 | 68.4 | -1.5% | Remained stable | | Profit for the period | 49.4 | 113.2 | -56.4% | Comprehensive impact of the above factors | | Adjusted net profit | 57.1 | 131.5 | -56.6% | Comprehensive impact of the above factors | | Adjusted net profit margin | 6.4% | 12.2% | -5.8% | Comprehensive impact of the above factors | [Financial and Liquidity Position](index=13&type=section&id=Financial%20and%20Liquidity%20Position) Net current assets increased, but total current assets decreased due to lower cash; interest-bearing borrowings rose, increasing the gearing ratio to **42.3%**, while contingent liabilities and arbitration remain Current Assets and Liabilities (As of June 30, 2025) | Indicator | June 30, 2025 (RMB million) | December 31, 2024 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Net current assets | 903.9 | 758.5 | +19.2% | | Total current assets | 3,733.8 | 4,222.3 | -11.5% | | Total current liabilities | 2,829.9 | 3,463.8 | -18.3% | Interest-Bearing Financial Institution Loans and Other Borrowings (As of June 30, 2025) | Indicator | June 30, 2025 (RMB million) | December 31, 2024 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Total | 2,535.9 | 2,198.3 | +15.4% | | Interest rate range | 2.2% - 24.0% | 2.2% - 24.0% | - | - The Group is in dispute with Lead Group regarding a put option for **49%** equity, with the seller claiming an inflated exercise price, while Minsheng Vocational Education believes the exercise is invalid and it has no obligation to purchase[62](index=62&type=chunk)[63](index=63&type=chunk)[64](index=64&type=chunk) - Arbitration is ongoing, and the Group has made no provision for this[62](index=62&type=chunk)[63](index=63&type=chunk)[64](index=64&type=chunk) - The Group provided a **RMB 400 million** loan to Lead Guojiao Education Technology (Beijing) Co., Ltd., secured by **49%** of Lead Group's shares[65](index=65&type=chunk)[66](index=66&type=chunk)[67](index=67&type=chunk)[68](index=68&type=chunk) - The seller claims the loan obligation has been offset, but the Group believes the outstanding principal and interest, and the pledge, remain in effect, with related arbitration ongoing[65](index=65&type=chunk)[66](index=66&type=chunk)[67](index=67&type=chunk)[68](index=68&type=chunk) Pledged Assets (As of June 30, 2025) | Type of Pledged Asset | June 30, 2025 (RMB million) | December 31, 2024 (RMB million) | | :--- | :--- | :--- | | Net long-term assets | 78.3 | 79.2 | | Time deposits | 897.6 | 551.3 | - The Group's majority of revenue and expenses are denominated in RMB, with some bank balances denominated in USD and HKD[70](index=70&type=chunk)[74](index=74&type=chunk) - The Group currently has no foreign exchange hedging policy, but management continuously monitors foreign currency exchange risk[70](index=70&type=chunk)[74](index=74&type=chunk) Gearing Ratio | Indicator | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Gearing ratio | 42.3% | 37.0% | Other Information [Directors' and Chief Executive's Interests and Short Positions in Share, Underlying Shares and Debentures](index=17&type=section&id=Directors'%20and%20Chief%20Executive's%20Interests%20and%20Short%20Positions%20in%20Share,%20Underlying%20Shares%20and%20Debentures) Directors and key executives hold long positions in company shares, with Chairman Li Xuechun holding **71.71%** through controlled entities Directors' Long Positions in Company Shares (As of June 30, 2025) | Director Name | Nature of Interest | Number of Shares Held | Approximate Percentage of Equity | | :--- | :--- | :--- | :--- | | Mr. Li Xuechun | Interest in controlled corporation | 3,024,604,000 | 71.71% | | Ms. Zhang Weiping | Beneficial owner | 20,000,000 | 0.47% | | Mr. Zuo Yichen | Beneficial owner | 5,400,000 | 0.13% | | Mr. Lin Yilong | Beneficial owner | 5,400,000 | 0.13% | | Ms. Li Yanping | Beneficial owner | 800,000 | 0.02% | - Save as disclosed above, as of June 30, 2025, no chief executive or any director of the company had any disclosable interests or short positions in the shares, underlying shares, or debentures of the company or its associated corporations[81](index=81&type=chunk)[83](index=83&type=chunk) [Substantial Shareholders' Interests and Short Positions in Shares and Underlying Shares](index=18&type=section&id=Substantial%20Shareholders'%20Interests%20and%20Short%20Positions%20in%20Shares%20and%20Underlying%20Shares) Minsheng Group is the largest shareholder with **71.71%** equity, while Huachang International and its affiliates hold **7.87%** Substantial Shareholders' Long Positions in Company Shares (As of June 30, 2025) | Shareholder Name | Nature of Interest | Number of Shares Held | Approximate Percentage of Equity | | :--- | :--- | :--- | :--- | | Minsheng Group | Beneficial owner | 3,024,604,000 | 71.71% | | Huachang International Limited | Beneficial owner | 332,000,000 | 7.87% | | Huaqin Development Limited | Interest in controlled corporation | 332,000,000 | 7.87% | | OCT (Asia) Holdings Limited | Interest in controlled corporation | 332,000,000 | 7.87% | | Pacific Climax Limited | Interest in controlled corporation | 332,000,000 | 7.87% | | Hong Kong OCT Limited | Interest in controlled corporation | 332,000,000 | 7.87% | | Shenzhen OCT Co., Ltd. | Interest in controlled corporation | 332,000,000 | 7.87% | | OCT Group Co., Ltd. | Interest in controlled corporation | 332,000,000 | 7.87% | - Huachang International Limited is wholly owned by Huaqin Development Limited, which is ultimately traceable to OCT Group Co., Ltd., thus these companies are deemed to have an interest in the shares held by Huachang International Limited[86](index=86&type=chunk)[89](index=89&type=chunk) [Share Option Scheme](index=20&type=section&id=Share%20Option%20Scheme) The share option scheme, adopted in 2017, has **44,700,000** unexercised options, with no grants, exercises, cancellations, or lapses during the period Share Option Details (As of June 30, 2025) | Participant Category and Name | Date of Grant | Exercise Price (HKD) | Unexercised as of January 1, 2025 | Unexercised as of June 30, 2025 | | :--- | :--- | :--- | :--- | :--- | | Zhang Weiping | 31/8/2017 | 1.39 | 12,000,000 | 12,000,000 | | Zhang Weiping | 27/8/2018 | 1.66 | 8,000,000 | 8,000,000 | | Zuo Yichen | 31/8/2017 | 1.39 | 3,000,000 | 3,000,000 | | Zuo Yichen | 27/8/2018 | 1.66 | 2,400,000 | 2,400,000 | | Lin Yilong | 31/8/2017 | 1.39 | 3,000,000 | 3,000,000 | | Lin Yilong | 27/8/2018 | 1.66 | 2,400,000 | 2,400,000 | | Li Yanping | 27/8/2018 | 1.66 | 800,000 | 800,000 | | Other employees | 31/8/2017 | 1.39 | 3,000,000 | 3,000,000 | | Other employees | 27/8/2018 | 1.66 | 8,300,000 | 8,300,000 | | Other employees | 19/8/2019 | 1.42 | 700,000 | 700,000 | | Other employees | 21/8/2020 | 1.22 | 1,100,000 | 1,100,000 | | **Total** | | | **44,700,000** | **44,700,000** | - As of June 30, 2025, the number of remaining shares available for issue under the share option scheme was **400,000,000** shares, representing approximately **9.48%** of the company's total issued shares[98](index=98&type=chunk)[102](index=102&type=chunk) - During the reporting period, no share options were granted, exercised, cancelled, or lapsed[96](index=96&type=chunk)[99](index=99&type=chunk)[102](index=102&type=chunk)[103](index=103&type=chunk) [Employee and Remuneration Policies](index=22&type=section&id=Employee%20and%20Remuneration%20Policies) The Group employs approximately **6,800** staff, with remuneration based on performance and market rates, offering comprehensive benefits and training programs - As of June 30, 2025, the Group employed approximately **6,800** staff in mainland China and Hong Kong SAR, a slight increase from **6,700** as of December 31, 2024[100](index=100&type=chunk)[104](index=104&type=chunk) - The Group provides comprehensive training programs for its employees and participates in various employee social security schemes managed by local governments[101](index=101&type=chunk)[104](index=104&type=chunk)[105](index=105&type=chunk)[112](index=112&type=chunk) - The Remuneration Committee is responsible for reviewing the remuneration policies and structure for directors and senior management, considering operating results, individual performance, and market practices[106](index=106&type=chunk)[112](index=112&type=chunk) [Compliance and Governance](index=23&type=section&id=Compliance%20and%20Governance) The company complied with relevant laws, corporate governance codes, and director securities trading standards, with no interim dividend recommended - During the reporting period and up to the date of this interim report, the Group has complied with relevant laws and regulations that have a material impact on the company[108](index=108&type=chunk)[113](index=113&type=chunk) - The Board does not recommend the payment of any dividend for the six months ended June 30, 2025[109](index=109&type=chunk)[114](index=114&type=chunk) - The company has complied with all code provisions set out in the Corporate Governance Code in Appendix C1 of the Listing Rules during the reporting period[110](index=110&type=chunk)[115](index=115&type=chunk) - All directors have confirmed compliance with the Model Code set out in Appendix C3 of the Listing Rules throughout the reporting period[111](index=111&type=chunk)[116](index=116&type=chunk)[117](index=117&type=chunk)[121](index=121&type=chunk) - The Board's Audit Committee, together with management, has reviewed the accounting standards and policies adopted by the Group, as well as the unaudited interim condensed consolidated financial statements[119](index=119&type=chunk)[123](index=123&type=chunk) [Acquisition in Progress During the Reporting Period](index=25&type=section&id=Acquisition%20in%20Progress%20During%20the%20Reporting%20Period) Two significant acquisitions, Qufu Changyong and Nanchang Hezhitong (both **51%** equity), remain in progress and are not yet completed - Chongqing Yuecheng signed a share transfer agreement on November 23, 2018, to acquire **51%** equity in Qufu Changyong Enterprise Management Consulting Co., Ltd. for **RMB 91.8 million**, thereby indirectly holding **51%** of the school sponsor's rights in Qufu Yuandong Vocational Technical College[125](index=125&type=chunk)[126](index=126&type=chunk)[127](index=127&type=chunk)[128](index=128&type=chunk)[129](index=129&type=chunk) - This acquisition has not yet been completed[125](index=125&type=chunk)[126](index=126&type=chunk)[127](index=127&type=chunk)[128](index=128&type=chunk)[129](index=129&type=chunk) - Chongqing Yiersheng signed an equity transfer agreement on March 15, 2019, to conditionally acquire **51%** equity in Nanchang Hezhitong Education Consulting Co., Ltd. for **RMB 510 million**, thereby indirectly holding **51%** of the school sponsor's rights in Nanchang Vocational University[130](index=130&type=chunk)[131](index=131&type=chunk)[134](index=134&type=chunk)[135](index=135&type=chunk) - This acquisition has not yet been completed[130](index=130&type=chunk)[131](index=131&type=chunk)[134](index=134&type=chunk)[135](index=135&type=chunk) [Litigation and Arbitration](index=26&type=section&id=Litigation%20and%20Arbitration) This section refers to the put option dispute over **49%** equity in Lead Group and arbitration regarding a loan to Lead Guojiao Education Technology (Beijing) Co., Ltd - For further details on litigation and arbitration, please refer to the "Contingent Liabilities" sub-section under the "Management Discussion and Analysis" section in this interim report[132](index=132&type=chunk)[136](index=136&type=chunk) - No significant events affecting the company or any of its subsidiaries occurred after the reporting period and up to the date of this interim report[132](index=132&type=chunk)[136](index=136&type=chunk) [Purchase, Sale or Redemption of Listed Securities of the Company](index=26&type=section&id=Purchase,%20Sale%20or%20Redemption%20of%20Listed%20Securities%20of%20the%20Company) Neither the company nor its subsidiaries purchased, sold, or redeemed any listed securities, with zero treasury shares held - During the reporting period, neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities (including sales of treasury shares)[133](index=133&type=chunk)[137](index=137&type=chunk) - As of June 30, 2025, the number of treasury shares held by the company was zero[133](index=133&type=chunk)[137](index=137&type=chunk) [Significant Investments Held and Future Plans for Material Investments or Acquiring Capital Assets](index=27&type=section&id=Significant%20Investments%20Held%20and%20Future%20Plans%20for%20Material%20Investments%20or%20Acquiring%20Capital%20Assets) The Group held equity investments at fair value through profit or loss, with no other material investment or capital asset acquisition plans disclosed - The Group held equity investments at fair value through profit or loss for the six months ended June 30, 2025[138](index=138&type=chunk)[141](index=141&type=chunk) - Save as disclosed in this interim report, as of June 30, 2025, the Group had no plans for material investments or acquiring capital assets[138](index=138&type=chunk)[141](index=141&type=chunk) [Material Acquisitions and Disposals](index=27&type=section&id=Material%20Acquisitions%20and%20Disposals) No material acquisitions or disposals of subsidiaries, associates, or joint ventures occurred during the period, other than those disclosed - Save as disclosed in this interim report, the Group had no material acquisitions or disposals of subsidiaries, associates, or joint ventures during the reporting period[139](index=139&type=chunk)[142](index=142&type=chunk) [Loan Agreements with Covenant Relating to Specific Performance of the Controlling Shareholders](index=27&type=section&id=Loan%20Agreements%20with%20Covenant%20Relating%20to%20Specific%20Performance%20of%20the%20Controlling%20Shareholders) Loan agreements with financial institutions include covenants requiring controlling shareholders to maintain their stake, with breaches constituting default events - Loan agreements with International Finance Corporation, Bank of China Macau Branch, DEG, and BEA Beijing Branch all require the ultimate controlling shareholder, Mr. Li Xuechun and/or Minsheng Group, to maintain not less than **51%** legal and beneficial ownership or the status of the single largest shareholder and actual control of the company[145](index=145&type=chunk)[148](index=148&type=chunk)[152](index=152&type=chunk)[156](index=156&type=chunk)[158](index=158&type=chunk)[162](index=162&type=chunk)[165](index=165&type=chunk)[168](index=168&type=chunk) - A breach of any specific performance covenant will constitute an event of default under the loan agreements, entitling the lenders to demand repayment of all or part of the loans[149](index=149&type=chunk)[153](index=153&type=chunk)[159](index=159&type=chunk)[163](index=163&type=chunk) - As of the date of this report, Minsheng Group holds approximately **71.71%** of the company's issued shares[168](index=168&type=chunk)[169](index=169&type=chunk) [Loan from International Finance Corporation](index=27&type=section&id=Loan%20from%20International%20Finance%20Corporation) Loan agreements with IFC, totaling up to **RMB 400 million** and **USD 51 million**, require controlling shareholders to maintain at least **51%** ownership - Chongqing Minsheng signed an RMB loan agreement with International Finance Corporation, initially for a total of up to **RMB 750 million**, later adjusted to **RMB 400 million**[140](index=140&type=chunk)[143](index=143&type=chunk)[144](index=144&type=chunk)[147](index=147&type=chunk) - Minsheng Education signed a USD loan agreement with International Finance Corporation for a total of up to **USD 51 million**, equivalent to **RMB 350 million**[144](index=144&type=chunk)[147](index=147&type=chunk) - The loan term is **8** years, with repayment in **11** equal installments starting from June 15, 2023[143](index=143&type=chunk)[147](index=147&type=chunk) [Loan from Bank of China Limited Macau Branch](index=29&type=section&id=Loan%20from%20Bank%20of%20China%20Limited%20Macau%20Branch) A **USD 44.8 million** term loan from Bank of China Macau requires Mr. Li Xuechun to maintain at least **51%** of the company's issued share capital - The company signed a facility agreement with Bank of China Macau Branch for a term loan facility of up to **USD 44.8 million**, with a loan term of **5** years[151](index=151&type=chunk)[156](index=156&type=chunk) - The loan will be used for the Group's mergers and acquisitions and general working capital purposes[151](index=151&type=chunk)[156](index=156&type=chunk) - The agreement requires Mr. Li Xuechun to maintain direct or indirect ownership of not less than **51%** of the company's issued share capital[152](index=152&type=chunk)[156](index=156&type=chunk) [Loan from DEG](index=29&type=section&id=Loan%20from%20DEG) A **USD 28.24 million** loan from DEG, due by June 15, 2028, mandates Mr. Li Xuechun and Minsheng Group to retain at least **51%** control - Minsheng Education signed a loan agreement with DEG for a total of up to **USD 28.24 million**, with the latest repayment date being June 15, 2028[155](index=155&type=chunk)[157](index=157&type=chunk) - The loan began repayment in **11** semi-annual installments on June 15, 2023, for the Group's business expansion and daily operations[155](index=155&type=chunk)[157](index=157&type=chunk) - The agreement requires Mr. Li Xuechun and Minsheng Group to each maintain legal and beneficial ownership of not less than **51%** of Minsheng Group's shares, and Minsheng Group to maintain legal and beneficial ownership of not less than **51%** of the company's shares[158](index=158&type=chunk)[162](index=162&type=chunk) [Loan from BEA Beijing Branch](index=30&type=section&id=Loan%20from%20BEA%20Beijing%20Branch) A **USD 15.12 million** loan from BEA Beijing requires Mr. Li Xuechun to remain the single largest shareholder and maintain actual control - The company signed a loan contract with BEA (China) Limited Beijing Branch for a total of **USD 15.12 million**[160](index=160&type=chunk)[165](index=165&type=chunk) - The loan will be repaid according to the repayment schedule, with the final repayment date being three years from the date of the first drawdown[160](index=160&type=chunk)[165](index=165&type=chunk) - The agreement requires Mr. Li Xuechun to maintain his status as the single largest shareholder and actual control of the company[161](index=161&type=chunk)[165](index=165&type=chunk) [Loan from CITIC Bank International](index=31&type=section&id=Loan%20from%20CITIC%20Bank%20International) A **RMB 300 million** revolving loan from CITIC Bank International requires Mr. Li Xuechun to maintain at least **51%** controlling interest - The company signed a facility letter with CITIC Bank International for a revolving loan facility of up to **RMB 300 million** or its equivalent in foreign currency[167](index=167&type=chunk)[169](index=169&type=chunk) - The final repayment date for the loan is no more than one year from the date of the first drawdown[167](index=167&type=chunk)[169](index=169&type=chunk) - The agreement requires Mr. Li Xuechun to maintain a controlling interest of not less than **51%** in the company[168](index=168&type=chunk)[169](index=169&type=chunk) Interim Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income [Profit or Loss Summary](index=31&type=section&id=Profit%20or%20Loss%20Summary) Revenue decreased by **17.1%** to **RMB 894.8 million**, with profit for the period falling **56.4%** to **RMB 49.4 million**, resulting in a loss attributable to parent owners Key Profit or Loss Data (Six Months Ended June 30) | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 894,786 | 1,079,786 | -17.1% | | Cost of sales | (539,374) | (498,948) | +8.1% | | Gross profit | 355,412 | 580,838 | -38.8% | | Other income and gains | 55,762 | 71,543 | -22.1% | | Selling expenses | (54,297) | (98,046) | -44.6% | | Administrative expenses | (196,236) | (240,309) | -18.4% | | Other expenses, net | (22,332) | (59,675) | -62.6% | | Finance costs | (67,351) | (68,419) | -1.5% | | Profit before tax | 70,958 | 185,932 | -61.8% | | Income tax expense | (21,597) | (72,767) | -70.3% | | Profit for the period | 49,361 | 113,165 | -56.4% | Profit for the Period Attributable (Six Months Ended June 30) | Attributable to | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Owners of the parent | (4,075) | 104,802 | | Non-controlling interests | 53,436 | 8,363 | | **Total** | **49,361** | **113,165** | (Loss)/Earnings Per Share (Six Months Ended June 30) | Indicator | 2025 | 2024 | | :--- | :--- | :--- | | Basic and diluted (loss)/earnings per share | RMB(0.0010) | RMB0.0248 | Interim Condensed Consolidated Statement of Financial Position [Financial Position Summary](index=33&type=section&id=Financial%20Position%20Summary) Total assets less current liabilities were **RMB 7,880.8 million**, with net assets at **RMB 5,992.2 million**, reflecting decreases in current assets and liabilities Key Balance Sheet Data (As of June 30, 2025) | Indicator | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Total non-current assets | 6,976,905 | 7,033,089 | | Total current assets | 3,733,808 | 4,222,337 | | Total current liabilities | 2,829,903 | 3,463,788 | | Net current assets | 903,905 | 758,549 | | Total assets less current liabilities | 7,880,810 | 7,791,638 | | Total non-current liabilities | 1,888,630 | 1,853,646 | | Net assets | 5,992,180 | 5,937,992 | | Total equity | 5,992,180 | 5,937,992 | - The decrease in current assets was primarily attributable to a decrease in cash and cash equivalents during the reporting period[54](index=54&type=chunk)[59](index=59&type=chunk) - The decrease in current liabilities was primarily due to a decrease in contract liabilities during the reporting period[55](index=55&type=chunk)[59](index=59&type=chunk) Interim Condensed Consolidated Statement of Changes in Equity [Equity Changes Summary](index=35&type=section&id=Equity%20Changes%20Summary) Total equity slightly increased to **RMB 5,992.2 million**, with parent owners' equity at **RMB 5,036.5 million** and non-controlling interests at **RMB 955.7 million** Key Equity Changes Data (Six Months Ended June 30) | Indicator | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Share capital | 322 | 322 | | Reserves | 5,036,206 | 5,035,913 | | Equity attributable to owners of the parent | 5,036,528 | 5,036,235 | | Non-controlling interests | 955,652 | 901,757 | | **Total equity** | **5,992,180** | **5,937,992** | - Profit for the period was **RMB 49,361 thousand**, of which **RMB 4,075 thousand** was a loss attributable to owners of the parent, and **RMB 53,436 thousand** was profit attributable to non-controlling interests[175](index=175&type=chunk) - Total other comprehensive income for the period was **RMB 4,815 thousand**, primarily from exchange differences on translation of financial statements[175](index=175&type=chunk) Interim Condensed Consolidated Statement of Cash Flows [Cash Flows Summary](index=37&type=section&id=Cash%20Flows%20Summary) Net cash used in operating, investing, and financing activities totaled **RMB 583.5 million**, **RMB 169.4 million**, and **RMB 66.7 million**, respectively, leading to a significant decrease in period-end cash Key Cash Flow Data (Six Months Ended June 30) | Cash Flow Type | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Net cash flows used in operating activities | (583,450) | (779,026) | | Net cash flows used in investing activities | (169,385) | (190,407) | | Net cash flows used in financing activities | (66,705) | (20,737) | | Net decrease in cash and cash equivalents | (819,540) | (990,170) | | Cash and cash equivalents at beginning of period | 2,520,311 | 3,189,846 | | Cash and cash equivalents at end of period | 1,695,488 | 2,194,356 | - The decrease in net cash flows used in operating activities was primarily due to an increase in cash used in operations resulting from a decrease in contract liabilities[179](index=179&type=chunk) - Net cash flows used in investing activities were mainly affected by the purchase and maturity of short-term investments[180](index=180&type=chunk) - The increase in net cash flows used in financing activities was primarily due to new bank loans and other borrowings, as well as repayment of bank and other borrowings[181](index=181&type=chunk) Notes to the Interim Condensed Consolidated Financial Information [Corporate and Group Information](index=42&type=section&id=Corporate%20and%20Group%20Information) The company, incorporated in the Cayman Islands on December 13, 2005, primarily provides educational services in China - The company was incorporated in the Cayman Islands as an exempted company with limited liability on December 13, 2005[182](index=182&type=chunk)[185](index=185&type=chunk) - For the six months ended June 30, 2025, the Group primarily provided educational services in the People's Republic of China[183](index=183&type=chunk)[185](index=185&type=chunk) [Basis of Preparation](index=42&type=section&id=Basis%20of%20Preparation) Unaudited interim condensed consolidated financial information is prepared in RMB under IAS 34, consistent with 2024 annual accounting policies - The financial information is prepared in accordance with International Accounting Standard 34 "Interim Financial Reporting"[184](index=184&type=chunk)[186](index=186&type=chunk) - The financial information is presented in RMB, and all amounts are rounded to the nearest thousand[184](index=184&type=chunk)[186](index=186&type=chunk) [Changes in Accounting Policies and Disclosures](index=43&type=section&id=Changes%20in%20Accounting%20Policies%20and%20Disclosures) Revised IFRS accounting standards, specifically IAS 21 (Revised) 'Lack of Exchangeability,' were adopted but had no impact due to the Group's convertible currencies - International Accounting Standard 21 (Revised) "Lack of Exchangeability" was adopted for the first time in the current period[187](index=187&type=chunk)[189](index=189&type=chunk) - As the currencies used for transactions by the Group and the functional currencies used by Group entities for translation into the Group's presentation currency are convertible, these amendments had no impact on the interim condensed consolidated financial information[188](index=188&type=chunk)[189](index=189&type=chunk) [Operating Segment Information](index=44&type=section&id=Operating%20Segment%20Information) The Group operates two segments, campus and online education, with campus education revenue at **RMB 782.8 million** and online education at **RMB 112.0 million** - The Group has two reportable operating segments: campus education and online education[190](index=190&type=chunk)[194](index=194&type=chunk) Segment Revenue (Six Months Ended June 30) | Segment | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Campus education | 782,801 | 752,217 | | Online education | 111,985 | 327,569 | | **Total** | **894,786** | **1,079,786** | Segment Results (Six Months Ended June 30) | Segment | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Campus education | 268,826 | 283,924 | | Online education | (98,177) | (2,372) | | **Total** | **170,649** | **281,552** | Segment Assets and Liabilities (As of June 30, 2025) | Segment | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Campus education assets | 9,983,401 | 10,463,743 | | Online education assets | 2,436,361 | 2,516,331 | | Campus education liabilities | 2,781,874 | 3,515,987 | | Online education liabilities | 2,441,343 | 2,426,207 | [Revenue, Other Income and Gains](index=47&type=section&id=Revenue,%20Other%20Income%20and%20Gains) Total revenue was **RMB 894.8 million**, primarily from tuition and accommodation fees, with other income at **RMB 55.8 million**, while online education revenue significantly declined Revenue from Contracts with Customers (Six Months Ended June 30) | Revenue Source | 2025 (RMB thousand) | 2024 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Tuition fees | 717,682 | 690,920 | +3.9% | | Accommodation fees | 65,119 | 61,297 | +6.2% | | Distance education services | 50,184 | 209,296 | -76.0% | | Teacher training services | 9,262 | 13,570 | -31.7% | | Online course services | 14,567 | 10,676 | +36.4% | | Sale of books | 6,406 | 15,615 | -59.0% | | Other education services | 31,566 | 78,412 | -59.7% | | **Total** | **894,786** | **1,079,786** | **-17.1%** | Other Income and Gains (Six Months Ended June 30) | Revenue Source | 2025 (RMB thousand) | 2024 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Short-term investment income | 8,809 | 22,071 | -60.1% | | Rental income | 10,693 | 3,756 | +184.7% | | Bank interest income | 4,271 | 4,080 | +4.7% | | Government grants | 14,644 | 13,382 | +9.4% | | Net exchange gains | 4,763 | 9,202 | -48.3% | | **Total** | **55,762** | **71,543** | **-22.1%** | - Government grants are primarily used to compensate for operating expenses and teaching facility expenditures for school teaching activities, with no unfulfilled conditions or contingencies[202](index=202&type=chunk)[204](index=204&type=chunk) [Profit Before Tax](index=50&type=section&id=Profit%20Before%20Tax) Profit before tax was **RMB 71.0 million**, influenced by various expenses and income, including depreciation, amortization, employee benefits, and financial asset impairment Expenses/Income Affecting Profit Before Tax (Six Months Ended June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Depreciation of property, plant and equipment | 85,013 | 83,433 | | Depreciation of right-of-use assets | 15,603 | 19,340 | | Amortization of other intangible assets | 15,491 | 40,053 | | Total employee benefit expenses | 367,095 | 391,146 | | Total impairment of financial assets | 17,867 | 58,141 | | Investment income from short-term investments | (8,809) | (22,071) | | Bank interest income | (4,271) | (4,080) | | Fair value loss/(gain) on equity investments | 2,676 | (4,182) | - Total employee benefit expenses (including directors' emoluments) amounted to **RMB 367,095 thousand**, a decrease from **RMB 391,146 thousand** in the prior period[212](index=212&type=chunk) - Impairment losses on financial assets significantly decreased from **RMB 58,141 thousand** in 2024 to **RMB 17,867 thousand** in 2025[215](index=215&type=chunk) [Income Tax](index=52&type=section&id=Income%20Tax) Income tax expense significantly decreased to **RMB 21.6 million**, with various corporate income tax rates applied, including preferential rates for certain entities Income Tax Expense (Six Months Ended June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Current - Mainland China | 23,875 | 127,203 | | Deferred | (2,278) | (54,436) | | **Total** | **21,597** | **72,767** | - Companies operating in mainland China are subject to a corporate income tax rate of **25%** on their respective taxable income[222](index=222&type=chunk)[223](index=223&type=chunk) - Some companies enjoy preferential tax rates of **15%** (e.g., schools under the Western Development Tax Incentive Program and high-tech enterprises) and **20%** (e.g., small and micro enterprises)[222](index=222&type=chunk)[223](index=223&type=chunk) - The Group's operating school in Yunnan, China, has been re-designated as a for-profit private school and enjoys a **15%** preferential tax rate under the Western Development Tax Incentive Program[224](index=224&type=chunk)[228](index=228&type=chunk) [Interim Dividend](index=54&type=section&id=Interim%20Dividend) The Board does not recommend any interim dividend for the six months ended June 30, 2025 - The Board does not recommend the payment of any dividend for the six months ended June 30, 2025 (six months ended June 30, 2024: nil)[225](index=225&type=chunk)[229](index=229&type=chunk) [Losses/Earnings Per Share Attributable to Ordinary Equity Holders of the Parent](index=54&type=section&id=Losses/Earnings%20Per%20Share%20Attributable%20to%20Ordinary%20Equity%20Holders%20of%20the%20Parent) Basic and diluted loss per share attributable to parent owners was **RMB (0.0010)**, with share options having an anti-dilutive effect (Loss)/Earnings Per Share Calculation (Six Months Ended June 30) | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | (Loss)/profit attributable to owners of the parent | (4,075) | 104,802 | | Weighted average number of ordinary shares in issue | 4,217,720,000 | 4,217,720,000 | | Basic and diluted (loss)/earnings per share | RMB(0.0010) | RMB0.0248 | - No adjustment has been made to the basic earnings per share amount for the dilutive impact of share options, as they had an anti-dilutive effect on the basic earnings per share amount presented[227](index=227&type=chunk)[230](index=230&type=chunk) [Property, Plant and Equipment](index=56&type=section&id=Property,%20Plant%20and%20Equipment) The Group acquired **RMB 62.4 million** in property, plant, and equipment, and disposed of assets with a net book value of **RMB 0.3 million**, realizing a net gain of **RMB 0.4 million** Property, Plant and Equipment Changes (Six Months Ended June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Cost of additions | 62,353 | 179,787 | | Net book value of assets disposed | 269 | 8,826 | | Net gain on disposal | 411 | 382 | [Financial Assets at Fair Value Through Profit or Loss](index=56&type=section&id=Financial%20Assets%20at%20Fair%20Value%20Through%20Profit%20or%20Loss) Total financial assets at fair value through profit or loss amounted to **RMB 120.7 million**, primarily comprising contingent consideration, short-term, and equity investments Financial Assets at Fair Value Through Profit or Loss (As of June 30, 2025) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Current assets: Contingent consideration | 107,301 | 107,301 | | Current assets: Short-term investments | 2,500 | – | | Non-current assets: Equity investments | 10,850 | 13,729 | | **Total** | **120,651** | **121,030** | [Other Non-Current Assets](index=57&type=section&id=Other%20Non-Current%20Assets) Other non-current assets totaled **RMB 264.0 million**, mainly advance payments for land use rights and acquisitions of private schools and companies Other Non-Current Assets (As of June 30, 2025) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Prepayments for acquisition of land use rights | 234,575 | 234,575 | | Prepayments for acquisition of private schools and companies | 19,260 | 19,260 | | Long-term prepayments, other receivables and other assets | 10,191 | 9,852 | | **Total** | **264,026** | **263,687** | [Trade Receivables](index=57&type=section&id=Trade%20Receivables) Total trade receivables were **RMB 367.4 million**, with the largest portion due within one year Ageing Analysis of Trade Receivables (As of June 30, 2025) | Ageing | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Within 1 year | 212,199 | 295,130 | | 1 to 2 years | 134,363 | 78,513 | | 2 to 3 years | 19,220 | 9,360 | | Over 3 years | 1,650 | 848 | | **Total** | **367,432** | **383,851** | [Trade Payables](index=58&type=section&id=Trade%20Payables) Total trade payables decreased to **RMB 449.4 million**, are interest-free, and typically settled within **30-60** days Ageing Analysis of Trade Payables (As of June 30, 2025) | Ageing | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Within 1 year | 277,190 | 407,255 | | 1 to 2 years | 90,148 | 86,539 | | 2 to 3 years | 76,991 | 6,714 | | Over 3 years | 5,054 | 25 | | **Total** | **449,383** | **500,533** | - Trade payables are interest-free and generally settled within **30** to **60** days[243](index=243&type=chunk)[244](index=244&type=chunk) [Contract Liabilities](index=59&type=section&id=Contract%20Liabilities) Total contract liabilities significantly decreased to **RMB 94.0 million**, primarily comprising prepaid tuition, accommodation, and distance education service fees Contract Liabilities Details (As of June 30, 2025) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Tuition fees | 10,200 | 685,090 | | Accommodation fees | 15,960 | 77,899 | | Distance education service fees | 8,342 | 8,888 | | Teacher training services | 135 | 107 | | Other education businesses | 59,397 | 63,171 | | **Total** | **94,034** | **835,155** | - Tuition and accommodation fees are collected in advance before the start of each academic year and recognized as revenue proportionally over the relevant course period[247](index=247&type=chunk)[249](index=249&type=chunk) - Students have the right to recover relevant amounts for services not yet provided[247](index=247&type=chunk)[249](index=249&type=chunk) - Contract liabilities primarily include short-term prepayments received from partner institutions and other customers, expected to be settled within one year[247](index=247&type=chunk)[249](index=249&type=chunk) [Other Payables and Accruals](index=60&type=section&id=Other%20Payables%20and%20Accruals) Other payables and accruals decreased to **RMB 652.5 million**, including accrued bonuses, property, plant, and equipment payables, and student expenses Other Payables and Accruals (As of June 30, 2025) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Accrued bonuses and other employee benefits | 65,832 | 87,901 | | Payables for purchase of property, plant and equipment | 168,254 | 281,677 | | Miscellaneous expenses collected from students | 173,570 | 138,234 | | Tuition fees collected from students | 66,371 | 62,043 | | **Total** | **652,466** | **776,711** | - Other payables are interest-free and repayable on demand[250](index=250&type=chunk) [Interest-Bearing Bank and Other Borrowings](index=61&type=section&id=Interest-Bearing%20Bank%20and%20Other%20Borrowings) Total interest-bearing bank and other borrowings increased to **RMB 2,535.9 million**, with rates ranging from **2.2%** to **24.0%**, secured by various assets Total Interest-Bearing Bank and Other Borrowings (As of June 30, 2025) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Current | 1,196,657 | 910,937 | | Non-current | 1,339,254 | 1,287,387 | | **Total** | **2,535,911** | **2,198,324** | - The effective interest rate range for borrowings is **2.2%** to **24.0%**[253](index=253&type=chunk) - Some bank loans and government loans are secured by property, plant and equipment, leasehold land, equity pledges (Chongqing Lion Industry Co., Ltd., Chongqing Minsheng Education Management Co., Ltd., Leling Minsheng Education High School Co., Ltd., Duxue Network Technology (Beijing) Co., Ltd.), and pledges of rights to tuition fees of Yunnan University Dianchi College[255](index=255&type=chunk)[256](index=256&type=chunk) - Time deposits of **RMB 897,585 thousand** (December 31, 2024: **RMB 551,250 thousand**) have been pledged to secure bank loans and other borrowings[255](index=255&type=chunk)[256](index=256&type=chunk) - Buildings and equipment with a carrying value of **RMB 502,454 thousand** (December 31, 2024: **RMB 251,450 thousand**) held under sale and leaseback liabilities are pledged as collateral for the related sale and leaseback liabilities[255](index=255&type=chunk)[256](index=256&type=chunk) - All borrowings are denominated in RMB, except for certain bank loans denominated in HKD and USD[255](index=255&type=chunk)[256](index=256&type=chunk) [Share Capital](index=64&type=section&id=Share%20Capital) The company's authorized share capital is **10 billion** ordinary shares at **USD 0.00001** par value, with **4.217 billion** issued and fully paid shares Share Capital Details (As of June 30, 2025) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Authorized share capital (10,000,000,000 ordinary shares) | 747 | 747 | | Issued and fully paid (4,217,720,000 ordinary shares) | 322 | 322 | [Contingent Liabilities](index=65&type=section&id=Contingent%20Liabilities) The Group faces a put option dispute over **49%** equity in Lead Group and loan arbitration, with ongoing proceedings and no provisions made - Minsheng Vocational Education is in dispute with the seller regarding a put option for **49%** of Lead Group's shares, with the seller claiming the exercise price is inflated by **RMB 2,180,735,567.50**[260](index=260&type=chunk)[261](index=261&type=chunk) - Minsheng Vocational Education believes the seller's exercise is invalid, and that it issued a deed of grant of option on August 3, 2023, but the seller failed to exercise it by the specified deadline, causing the deed to automatically expire[260](index=260&type=chunk)[261](index=261&type=chunk) - The Group provided a **RMB 400 million** loan to Lead Guojiao Education Technology (Beijing) Co., Ltd., secured by **49%** of Lead Group's shares[263](index=263&type=chunk)[265](index=265&type=chunk)[266](index=266&type=chunk)[267](index=267&type=chunk) - The seller claims the loan obligation has been offset, but the Group believes the outstanding principal and interest, and the pledge, remain in effect[263](index=263&type=chunk)[265](index=265&type=chunk)[266](index=266&type=chunk)[267](index=267&type=chunk) - As of the date of approval of the consolidated financial statements, arbitrations at the Hong Kong International Arbitration Centre and China International Economic and Trade Arbitration Commission are ongoing, and the Group has made no provisions for these arbitrations[262](index=262&type=chunk)[264](index=264&type=chunk)[265](index=265&type=chunk) [Commitments](index=67&type=section&id=Commitments) Total contractual commitments amounted to **RMB 280.3 million**, primarily for equipment, buildings, and private school acquisitions Contractual Commitments (As of June 30, 2025) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Equipment | 58,141 | 86,627 | | Buildings | 130,315 | 164,569 | | Acquisition of private schools | 91,800 | 91,800 | | **Total** | **280,256** | **342,996** | - As of the end of the reporting period, the Group had no authorized but uncontracted material capital commitments[270](index=270&type=chunk) [Related Party Transactions](index=68&type=section&id=Related%20Party%20Transactions) The Group engaged in loan and interest transactions with Minsheng Group Co., Ltd., with **RMB 172.6 million** owed and **RMB 13.3 million** in key management compensation Related Party Transactions (Six Months Ended June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Loans from Minsheng Group Co., Ltd. | 38,982 | 124,719 | | Repayment of loans from Minsheng Group Co., Ltd. | 33,029 | – | | Interest expenses paid to Minsheng Group Co., Ltd. | 560 | 744 | - As of the end of the reporting period, the Group had an outstanding balance of **RMB 172,636 thousand** payable to its ultimate holding company, Minsheng Group Co., Ltd., which is unsecured, bears interest at **5%** per annum, and is repayable within one year[273](index=273&type=chunk)[274](index=274&type=chunk) Key Management Personnel Compensation (Six Months Ended June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Salaries, allowances and benefits in kind | 12,983 | 12,826 | | Contributions to pension schemes | 273 | 259 | | **Total** | **13,256** | **13,085** | [Fair Value and Fair Value Hierarchy of Financial Instruments](index=70&type=section&id=Fair%20Value%20and%20Fair%20Value%20Hierarchy%20of%20Financial%20Instruments) Total fair value of financial assets was **RMB 129.9 million**, and financial liabilities **RMB 2,474.5 million**, with most short-term instruments valued at book value Fair Value of Financial Assets (As of June 30, 2025) | Item | Carrying Amount (RMB thousand) | Fair Value (RMB thousand) | | :--- | :--- | :--- | | Financial assets at fair value through profit or loss – Equity investments | 10,850 | 10,850 | | Financial assets at fair value through profit or loss – Contingent consideration | 107,301 | 107,301 | | Financial assets at fair value through profit or loss – Short-term investments | 2,500 | 2,500 | | Financial assets included in other non-current assets | 9,260 | 9,260 | | **Total** | **129,911** | **129,911** | Fair Value of Financial Liabilities (As of June 30, 2025) | Item | Carrying Amount (RMB thousand) | Fair Value (RMB thousand) | | :--- | :--- | :--- | | Interest-bearing bank and other borrowings (excluding lease liabilities) | 2,502,006 | 2,474,525 | - Management has assessed that the fair values of cash and cash equivalents, trade receivables, trade payables, and other short-term financial instruments approximate their carrying amounts[284](index=284&type=chunk)[287](index=287&type=chunk) - Fair value measurements primarily use Level 2 (significant observable inputs), including short-term investments and contingent consideration[292](index=292&type=chunk)[294](index=294&type=chunk)[297](index=297&type=chunk)[299](index=299&type=chunk)[302](index=302&type=chunk)[304](index=304&type=chunk) [Event After the Period](index=77&type=section&id=Event%20After%20the%20Period) No significant events occurred after the reporting period - No significant events occurred after the reporting period[306](index=306&type=chunk)[308](index=308&type=chunk)

2025 中期報告 * 僅供識別 目錄 公司資料 2 管理層討論及分析 4 其他資料 21 簡明合併財務狀況表 32 簡明合併利潤表 34 簡明合併全面收益表 36 簡明合併權益變動表 37 簡明合併現金流量表 39 簡明合併財務資料附註 40 3 華油能源集團有限公司 2 二零二五中期報告 公司資料 董事會 執行董事 吳東方先生 （主席兼行政總裁） 李強先生 丁克臣先生 非執行董事 王國強先生 武吉偉先生 陳春花女士 獨立非執行董事 張渝涓女士 胡國強先生 馬小虎先生 審核委員會 胡國強先生 （主席） 陳春花女士 馬小虎先生 薪酬委員會 張渝涓女士 （主席） 吳東方先生 胡國強先生 提名委員會 吳東方先生 （主席） 張渝涓女士 胡國強先生 授權代表 吳東方先生 黎少娟女士 公司秘書 黎少娟女士 （FCG 、HKFCG） 公司網站 www.sptenergygroup.com 香港主要營業地點 香港 銅鑼灣 希慎道33 號 利園一期 19 樓1918 室 中國主要營業地點 中國 北京市 朝陽區 紅軍營東路甲 8 號 鴻懋商務大廈 5 層 （郵編：100012 ） 3 華油能源集團有限公司 2 二零二五中期報告 ...

Financial Performance - Revenue for the six months ended June 30, 2025, was RMB 381.3 million, a decrease of 14.9% compared to RMB 448.0 million in 2024[11] - Gross profit for the same period was RMB 80.7 million, down 35.6% from RMB 125.2 million in 2024[11] - The company reported a pre-tax loss of RMB 135.9 million, a decline of 282.6% compared to a profit of RMB 74.4 million in 2024[11] - The net loss for the period was RMB 123.5 million, a significant drop of 294.6% from a profit of RMB 63.5 million in 2024[11] - Basic and diluted loss per share was RMB 6.53, compared to earnings of RMB 3.51 per share in the same period last year[112] - Total comprehensive loss for the period amounted to RMB 130,192 thousand, compared to a total comprehensive income of RMB 45,054 thousand in 2024[112] - The company reported a loss of approximately RMB 123.5 million for the six months ended June 30, 2025, compared to a profit of RMB 63.5 million in the same period of 2024, resulting in a net profit margin decline from approximately 14.2% to -32.4%[54] Revenue Breakdown - Revenue from AR and VR marketing services was RMB 214.7 million, a decrease of 33.5% year-over-year, primarily due to a 24.0% drop in average spending per advertising client[30] - Revenue from AR and VR content increased by 12.6% year-over-year to RMB 119.9 million, driven by improved project quality and higher project prices[19] - The revenue breakdown showed AR and VR marketing services accounted for 56.3% of total revenue, while AR and VR content contributed 31.5%[29] - The revenue from the AR and VR content business for the six months ended June 30, 2025, was approximately RMB 119.9 million, an increase of about 12.6% compared to RMB 106.5 million for the same period in 2024[33] - Revenue from the AR and VR SaaS business significantly decreased by approximately 56.5%, from about RMB 14.3 million in the six months ended June 30, 2024, to approximately RMB 6.2 million in the same period of 2025[36] - Other business revenue increased 5.5 times to approximately RMB 23.7 million for the six months ended June 30, 2025, compared to RMB 4.3 million in 2024, due to proactive strategies in seeking new business opportunities[37] Cost and Expenses - The total cost of revenue for the group was approximately RMB 300.7 million for the six months ended June 30, 2025, a decrease of about 6.9% from RMB 322.8 million in 2024[38] - Distribution and selling expenses surged to approximately RMB 67.9 million, a significant increase of about 7.8 times from RMB 8.7 million in the same period of 2024, driven by higher promotional costs related to subcontractors[49] - Research and development expenses rose to approximately RMB 46.1 million, a substantial increase of about 3.2 times from RMB 14.4 million in the same period of 2024, due to increased R&D efforts in motion capture technology and VR[51] - Administrative expenses decreased by approximately 46.0% to about RMB 15.0 million from RMB 27.7 million in the same period of 2024, attributed to reduced employee-related costs and strategic business cutbacks[50] Assets and Liabilities - Trade receivables increased from approximately RMB 641.9 million to about RMB 781.1 million as of June 30, 2025, reflecting an increase in the turnover days of trade receivables[57] - The provision for expected credit losses on trade receivables increased by approximately RMB 85.1 million to RMB 143.7 million, mainly due to an increase in long-overdue receivables from major customers[46] - Current liabilities increased to RMB 416,915 thousand from RMB 373,507 thousand, marking an increase of around 11.6%[114] - The company's total assets amounted to RMB 1,530,281 thousand, a decrease from RMB 1,568,254 thousand as of December 31, 2024, representing a decline of approximately 2.4%[114] Corporate Governance and Compliance - The company has committed to high standards of corporate governance to enhance transparency and accountability[105] - The audit committee has reviewed the interim financial results and found them to comply with applicable accounting standards and regulations[102] - The company emphasizes compliance with the corporate governance code as per the listing rules[167] Future Plans and Investments - The company is focusing on the integration of AR, VR, and AI technologies to provide efficient digital solutions across various industries[12] - The company aims to enhance user engagement through immersive experiences in sectors such as tourism, education, and finance[12] - The company is committed to increasing R&D investment to optimize its AR and VR engines and AI algorithms[13] - Future plans include deepening the integration of AI with AR and VR/MR technologies to enhance service quality and production efficiency[27] Shareholder Information - The total number of issued shares, including treasury shares, is 2,168,328,000 as of June 30, 2025[96] - The company repurchased a total of 2,672,000 shares, which were canceled in May 2025[97] - The company does not recommend the payment of an interim dividend for the six months ending June 30, 2025[87] - The total number of share options available under the post-IPO share option plan is 181 million shares, representing about 8.4% of the total issued shares as of the report date[88] Cash Flow and Financing - The company's cash and cash equivalents amounted to approximately RMB 21.0 million as of June 30, 2025[64] - The company reported a net cash position, making the leverage ratio not applicable[68] - The company reported a net cash outflow of RMB 140,422 thousand for the period, compared to RMB 198,336 thousand in the previous year, indicating a reduction in cash outflow by about 29.1%[122]

Financial Performance - The group reported a contracted sales amount of approximately RMB 558 million, a decrease of about 50.6% compared to the same period last year[14]. - Revenue for the period was approximately RMB 833 million, representing a decrease of about 92.2% compared to the previous year[15]. - Revenue from property sales was approximately RMB 819 million, a decrease of about 92.3% year-on-year[15]. - The net loss attributable to the company's shareholders was approximately RMB 908 million, a decrease of about 445.6% compared to the same period last year[15]. - The basic loss per share for the period was approximately RMB 0.15[9]. - The company reported a signed sales amount of approximately RMB 55.8 million for the six months ended June 30, 2025, a decrease of about 50.6% compared to the same period last year[22]. - Revenue for the same period was approximately RMB 83.3 million, reflecting a significant decline of about 92.2% year-on-year, with property sales contributing approximately RMB 81.9 million, down 92.3%[22]. - The gross profit for the reporting period was approximately RMB 33.4 million, while the net loss amounted to approximately RMB 85.2 million, with the loss attributable to the company's owners being approximately RMB 90.8 million[22]. - The group’s revenue for the reporting period was approximately RMB 833 million, a decrease of about 92.2% compared to RMB 1,069.5 million in the same period last year[51]. - Property sales revenue was approximately RMB 819 million, down about 92.3% year-on-year, primarily due to reduced revenue recognition from the Jinhu Courtyard Phase I project[51]. - The group’s gross profit was approximately RMB 334 million, a decrease of about 87.0% from RMB 2,569 million in the previous year, with a gross profit margin of approximately 40.1%[53][54]. - The net loss attributable to the company's owners was approximately RMB 908 million, a decrease of about 445.6% compared to a profit of RMB 263 million in the same period last year[57]. - The total comprehensive loss for the period was RMB 87,209,000, compared to a comprehensive income of RMB 93,106,000 in 2024[103]. Assets and Liabilities - The total land reserve area reached approximately 2,125,308 square meters[16]. - The company holds a total completed building area of approximately 3,364,127 square meters and land reserves of approximately 2,125,308 square meters as of June 30, 2025[27]. - As of June 30, 2025, the outstanding bank borrowings and other loans amounted to approximately RMB 2,712.1 million and RMB 180.3 million, respectively[66]. - As of June 30, 2025, the total secured assets for the group's borrowings amounted to approximately RMB 1,662.0 million, compared to RMB 1,654.3 million as of December 31, 2024[68]. - The group provided guarantees for customer mortgage obligations totaling approximately RMB 930.2 million as of June 30, 2025, down from RMB 988.5 million as of December 31, 2024[69]. - The capital-to-debt ratio at the end of the reporting period was approximately 237.7%, an increase from 222.4% as of December 31, 2024, primarily due to losses during the period[71]. - The group had no significant contingent liabilities as of June 30, 2025[70]. - The total carrying amount of properties under development was RMB 4,982,575,000, an increase from RMB 4,921,678,000 as of December 31, 2024[133]. - The total carrying value of properties held for sale as of June 30, 2025, is approximately RMB 87,784,000, compared to RMB 87,401,000 as of December 31, 2024[135]. - The total interest-bearing bank loans and other borrowings decreased to RMB 2,712,073,000 as of June 30, 2025, from RMB 2,730,496,000 as of December 31, 2024, a reduction of 0.7%[137]. Business Strategy and Market Outlook - The company aims to focus on the development of high-end improvement-type residential properties, enhancing product design, construction quality, and green building standards[20]. - The company plans to actively adjust its business strategy to capture opportunities in the improving residential market and enhance risk control capabilities[19]. - The real estate market is expected to continue its differentiated recovery in the second half of 2025, driven by ongoing policy easing and supply-demand adjustments[18]. - The rental housing market is projected to grow, with an increasing supply of long-term rental apartments and affordable rental housing becoming significant components[19]. - The company is expanding into new markets, including Haikou and Wuzhishan, with multiple residential and commercial projects scheduled for completion between 2025 and 2028[41]. Development Projects - The group has 886,621 square meters of buildings under development and 975,839 square meters planned for future development[32]. - The completed projects include 1,258,097 square meters of high-rise buildings and 875,887 square meters of low-rise buildings[32]. - The group’s completed projects include 249,752 square meters of retail space, with 106,908 square meters currently under development[32]. - The company is developing the Chenxing International Health City in Xishuangbanna, with a total area of 223,826 square meters planned for completion by December 2028[42]. - The company has a significant project in Mianyang, with a total area of 91,695 square meters and a 60% ownership stake[44]. - The total estimated building area for the Jinzhong project phases is 1,000,000 square meters, with significant portions still in the planning and pre-sale stages[39]. - The estimated completion dates for key projects include November 2025 for the first phase of Chenxing Yijun and December 2027 for the second and third phases in Jinzhong[39]. Shareholder Information - As of June 30, 2025, the total number of issued shares of the company is 599,999,989 shares[100]. - Mr. Bai holds 346,944,000 shares, representing 57.82% of the company's equity[90]. - Mr. Bai Wu Kui holds 64,945,000 shares, representing 10.82% of the company's equity[90]. - White Dynasty BVI is the beneficial owner of 346,944,000 shares, representing 57.82% of the company's equity[94]. - Hwabao Trust Co. Ltd. holds 62,160,000 shares, representing 10.36% of the company's equity[94]. - The company has not granted any options under the share option scheme since its adoption in June 2015, with the maximum number of options available being 50,000,000 shares, equivalent to 10% of the issued shares post-global offering[97]. - The share option scheme is valid for a period of ten years from its adoption date, expiring on June 12, 2025[97]. - The company has a family trust structure involving Mr. Bai and his family members, with significant shareholdings concentrated within this trust[100]. Operational Efficiency - The group’s selling and distribution expenses decreased by approximately 64.2% to about RMB 98 million, primarily due to a significant decline in sales of the Jinhu Courtyard Phase I project[58]. - Administrative expenses decreased by approximately 29.4% to about RMB 204 million, mainly due to the decline in property sales[59]. - The group employed 199 staff members, with employee costs amounting to approximately RMB 10.0 million during the reporting period[77]. - The audit committee, composed of three independent non-executive directors, reviewed the group's financial reporting and internal controls, confirming compliance with applicable accounting principles[87]. - The company maintained sufficient public float as per the requirements of the stock exchange as of the report date[86]. Cash Flow and Financing - Cash and cash equivalents as of June 30, 2025, were approximately RMB 1,245 million, an increase of about 15.7% from RMB 1,077 million as of December 31, 2024[64]. - The group recorded positive operating cash flow of approximately RMB 535 million during the reporting period, compared to RMB 487 million in the same period last year[65]. - The company’s cash flow from operating activities was positively impacted by an increase in other payables and accrued expenses, which rose by RMB 185,816 thousand[110]. - The company incurred a net cash outflow from investing activities of RMB 1,751 thousand, a decrease from a net inflow of RMB 36,164 thousand in the previous year[112]. - The company’s financing activities resulted in a net cash outflow of RMB 34,212 thousand, compared to RMB 100,081 thousand in the previous year[112].

於開曼群島註冊成立的成員有限公司 股票代號 : 2188 2025 中期報告 * 僅供識別 Grand Cayman KY1-1111 Cayman Islands 3 中國泰坦能源技術集團有限公司 二零二五年中期報告 公司資料 目錄 | | 頁碼 | | --- | --- | | 公司資料 | 2 | | 管理層討論及分析 | 4 | | 簡明綜合財務報表 | | | 簡明綜合損益及其他全面收益表 | 22 | | 簡明綜合財務狀況表 | 24 | | 簡明綜合權益變動表 | 26 | | 簡明綜合現金流量表 | 27 | | 簡明綜合財務報表附註 | 28 | | 其他資料 | 47 | 公司資料 二零二五年中期報告 中國泰坦能源技術集團有限公司 2 | 董事會 | 執行董事 | | --- | --- | | | （主席） 高峽先生 | | | 李欣青先生 | | | 畢景峰先生 | | | （行政總裁） 安慰先生 | | | 非執行董事 | | | 陶琛先生 | | | 獨立非執行董事 | | | 李向鋒先生 | | | 劉偉先生 | | | 蔣彥女士 | | 審核委員會 | （委員會主席） 蔣彥女 ...

2025 中期報告 佳源服務控股有限公司 J I A Y U A N S E R V I C E S H O L D I N G S L I M I T E D 目錄 | 公司資料 | 2 | | --- | --- | | 管理層討論及分析 | 3 | | 企業管治及其他資料 | 15 | | 獨立審閱報告 | 18 | | 中期簡明合併全面收益表 | 20 | | 中期簡明合併財務狀況表 | 21 | | 中期簡明合併權益變動表 | 23 | | 中期簡明合併現金流量表 | 24 | | 中期財務資料附註 | 25 | 董事 執行董事 李猛先生 （主席） 辛冰先生 非執行董事 阮紅女士 獨立非執行董事 張辰先生 崔艷女士 蔡思韜先生 審核委員會 崔艷女士 （主席） 張辰先生 蔡思韜先生 薪酬委員會 李猛先生 梁君慧女士 核數師 羅申美會計師事務所 法律顧問 香港法律： CLKW Lawyers LLP （與李智聰律師事務所聯營） 中國法律： 浙江宜景源律師事務所 開曼群島法律： Conyers Dill & Pearman 張辰先生 （主席） 李猛先生 崔艷女士 提名委員會 李猛先生 （主席） 張辰先生 ...

Financial Performance - Revenue for the six months ended June 30, 2025, was HKD 1,818,056, an increase of 5.2% from HKD 1,728,693 in the same period of 2024[4] - Gross profit for the same period was HKD 355,943, representing a 10.8% increase compared to HKD 321,050 in 2024[4] - Profit before tax increased to HKD 109,839, up 22.7% from HKD 89,543 in the previous year[4] - Net profit for the period was HKD 82,318, a rise of 14.4% from HKD 72,034 in 2024[4] - Basic earnings per share increased to HKD 12.28, compared to HKD 10.72 in the same period last year, reflecting a growth of 14.6%[5] - Total comprehensive income for the period was HKD 81,656, up from HKD 67,916 in 2024, marking a 20.1% increase[5] - The company reported a pre-tax profit of HKD 109,839,000 for the six months ended June 30, 2025, compared to HKD 89,543,000 for the same period in 2024, marking an increase of around 22.7%[27][28] - Profit attributable to shareholders for the same period was approximately HKD 70,560,000, an increase of 15% year-on-year[60] Revenue Breakdown - Revenue from metal products was HKD 554,657,000 for the six months ended June 30, 2025, compared to HKD 517,153,000 in the same period of 2024, reflecting an increase of about 7.2%[21][22] - Revenue from construction materials reached HKD 1,247,998,000 for the six months ended June 30, 2025, up from HKD 1,211,444,000 in 2024, indicating a growth of approximately 3.0%[21][28] - Revenue from the metal products segment was approximately HKD 556,474,000, a 7% increase compared to the previous year, with profit before interest and tax rising by 55%[61] - Revenue from the construction materials segment was approximately HKD 1,248,094,000, a 3% increase year-on-year, while profit before interest and tax decreased by 9%[63] - The company provided medical scanning services, generating revenue of HKD 15,269,000 for the six months ended June 30, 2025, compared to HKD 96,000 in the same period of 2024[21][22] Assets and Liabilities - Current assets decreased to HKD 1,830,632 from HKD 2,007,599 as of December 31, 2024, indicating a decline of 8.8%[7] - Current liabilities decreased to HKD 745,536 from HKD 985,495, a reduction of 24.4%[8] - Total equity increased to HKD 1,571,994 from HKD 1,513,056, reflecting a growth of 3.9%[8] - The company reported a decrease in inventory to HKD 446,309 from HKD 605,812, a decline of 26.3%[7] - Trade receivables increased to HKD 897,731,000 as of June 30, 2025, from HKD 779,638,000 as of December 31, 2024, indicating a growth of approximately 15.2%[44] - Trade payables decreased to HKD 172,478,000 as of June 30, 2025, from HKD 275,594,000 as of December 31, 2024, reflecting a decline of about 37.5%[48] - The company’s total liabilities decreased to HKD 1,571,994,000 as of June 30, 2025, from HKD 1,513,056,000 at the end of the previous period[11] Cash Flow and Investments - For the six months ended June 30, 2025, the net cash generated from operating activities was HKD 708,394,000, a decrease of 21.9% compared to HKD 907,386,000 for the same period in 2024[13] - The company reported a decrease in cash and cash equivalents, with a net decrease of HKD 148,729,000, compared to a decrease of HKD 198,495,000 in the prior year[13] - The group’s cash and cash equivalents totaled approximately HKD 453,117,000 as of June 30, 2025, down from approximately HKD 599,490,000 as of December 31, 2024[69] - New bank loans during the period amounted to HKD 93,289,000, with repayments totaling HKD 75,052,000 and HKD 816,467,000 for bank loans and trust receipt loans, respectively[50] - The company made an investment of HKD 222,000 in acquiring a subsidiary during the period, indicating ongoing expansion efforts[13] Dividends and Shareholder Information - The company declared dividends amounting to HKD 20,103,000 during the period, which is a decrease from HKD 22,975,000 declared in the previous period[11] - The company declared a final dividend of HKD 0.04 per share for the year ending December 31, 2024, totaling HKD 22,975,000, compared to HKD 20,103,000 for the previous period[40] - Major shareholder Golik Investments Ltd. holds 201,666,392 shares, representing 35.11% of the issued share capital[79] Committees and Governance - The audit committee was established on January 5, 1999, and consists of three independent non-executive directors[82] - The remuneration committee was formed on April 21, 2005, with one executive director and three independent non-executive directors[83] - The nomination committee was established on December 30, 2021, comprising two executive directors and three independent non-executive directors[84] - The company has adopted a code of conduct for directors' securities transactions, confirming compliance with the standard code[85] Operational Insights - The company continues to focus on product research and development and market expansion to maintain its competitive edge in the high-end steel wire rope market[62] - Revenue for the construction materials business increased compared to the same period last year, attributed to fewer rainy days in Hong Kong and normal construction progress[65] - The medical imaging center, Assure Medical Imaging, generated approximately HKD 15,269,000 in revenue with an EBITDA positive variance during its first six months of operation[67] - The group plans to optimize internal operations and increase patient throughput in the second half of the year[68] - The group maintains a cautious optimism regarding annual performance despite ongoing macroeconomic challenges[73] Financial Ratios - The current ratio improved to 2.46:1 as of June 30, 2025, compared to 2.04:1 as of December 31, 2024[69] - The net asset to debt ratio was -0.06:1 as of June 30, 2025, compared to -0.04:1 as of December 31, 2024[70] Other Financial Information - The company incurred a loss of HKD 140,000 in fair value losses on financial instruments during the period, compared to no such losses in the previous period[10] - The company incurred expenses of HKD 7,104,000 related to short-term leases with an associate company during the period[57] - The effective interest rates on bank borrowings ranged from 1.03% to 5.72% as of the reporting period end[50] - The group has committed capital expenditures of approximately HKD 4,157,000 for property, plant, and equipment as of June 30, 2025[69] - The company has not applied any new accounting standards or interpretations that have not yet come into effect during the current accounting period[18] - The company’s credit terms for customers range from 30 to 180 days, consistent with the previous period[25]

[Company Information](index=2&type=section&id=Company%20Information) Provides details on the company's governance structure, including its board of directors and key contact information [Board of Directors and Committees](index=3&type=section&id=Board%20of%20Directors%20and%20Committees) The Board comprises executive, non-executive, and independent non-executive directors, supported by audit, remuneration, and nomination committees for robust corporate governance - Board members include Executive Director **Mr. Choi Ka Tsan** (Chairman and Chief Executive Officer), Dr. Fok Siu Wing, Ms. Cheung Siu Suet, Mr. Lau Sze Yam (resigned), and Mr. Wong Yu (newly appointed)[4](index=4&type=chunk) - The Board has an Audit Committee (Chairman: Mr. Chan Wai Kun), a Remuneration Committee (Chairman: Mr. Cheung Ka Ming), and a Nomination Committee (Chairman: Mr. Choi Ka Tsan)[4](index=4&type=chunk) [Company Contact Information](index=3&type=section&id=Company%20Contact%20Information) Details the company secretary, auditor, registered and principal offices, and primary banking relationships - The Company Secretary is Mr. Lo Wai Keung, and the Auditor is UHY CPA Limited[4](index=4&type=chunk) - The registered office is in Bermuda, and the principal place of business in Hong Kong is located at 6/F, Quality HealthCare Medical Centre, 10-12 Yuen Shun Circuit, Siu Lek Yuen, Sha Tin, New Territories, Hong Kong[4](index=4&type=chunk)[5](index=5&type=chunk) - Major bankers include Bank of China (Hong Kong), Bank of Communications, Dah Sing Bank, Hang Seng Bank, Nanyang Commercial Bank, Standard Chartered Bank (Hong Kong), and UBS AG Hong Kong Branch[5](index=5&type=chunk) [Financial Summary](index=4&type=section&id=Financial%20Summary) Presents key financial performance and position highlights for the six months ended June 30, 2025, showing a return to profitability and improved financial health [Financial Summary](index=5&type=section&id=Financial%20Summary) For the six months ended June 30, 2025, the Group achieved a net profit of approximately HK$35.6 million, with profit attributable to owners of HK$12.7 million, alongside growth in net assets and a stable liquidity ratio Key Financial Data for the Six Months Ended June 30, 2025 | Indicator | 2025 (HK$) | 2024 (HK$) | | :--- | :--- | :--- | | Revenue | 900,923,000 | 914,280,000 | | Net Profit | 35,593,000 | (28,542,000) | | Profit Attributable to Owners of the Company | 12,727,000 | (47,676,000) | | **As of June 30, 2025** | | | | Net Assets | 3,436,900,000 | 3,380,347,000 (December 31, 2024) | | Net Current Assets | 1,306,142,000 | 1,300,647,000 (December 31, 2024) | | Current Ratio | 3.19 | 3.19 (December 31, 2024) | | Gearing Ratio | 0.38% | 2.71% (December 31, 2024) | - The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025 (2024: nil)[6](index=6&type=chunk) [Management Discussion and Analysis](index=5&type=section&id=Management%20Discussion%20and%20Analysis) Discusses the Group's financial performance, business operations, future outlook, and financial resources, highlighting key drivers and strategic initiatives [Financial Review](index=5&type=section&id=Financial%20Review) The Group returned to profitability with a HK$35.6 million profit for the first half, driven by reduced fair value losses on investment properties and lower impairment losses from associates, despite a decrease in gross profit - The Group recorded an unaudited profit of approximately **HK$35.59 million** (2024: loss of approximately HK$28.54 million), including profit attributable to owners of approximately **HK$12.73 million** (2024: loss of approximately HK$47.68 million)[8](index=8&type=chunk) - Fair value loss on investment properties decreased to approximately **HK$2.55 million** (2024: HK$26.87 million), primarily due to a continued but less severe contraction in the Hong Kong property market[8](index=8&type=chunk) - No impairment loss on interests in associates was recognized in the current period, compared to an impairment loss of approximately **HK$36.7 million** for the six months ended June 30, 2024[9](index=9&type=chunk) - Share of profit from associates was approximately **HK$7.26 million** (2024: share of loss of approximately HK$1.99 million), mainly attributable to cost control measures implemented by associates[10](index=10&type=chunk) - Gross profit decreased to approximately **HK$230.18 million** (2024: HK$249.55 million), primarily due to the overall unfavorable economic environment[11](index=11&type=chunk) [Business Review](index=6&type=section&id=Business%20Review) As a leading listed healthcare group in Hong Kong, the Group's operations span Hong Kong medical services, network management, Mainland China hospital and health management, and medical aesthetics, demonstrating resilience and achieving profitability amidst a challenging macroeconomic environment - The Group's business covers five core areas: Hong Kong medical services, medical network management; Mainland China hospital management, health management; and medical aesthetics and beauty wellness in Hong Kong and Mainland China[12](index=12&type=chunk) - Cost control measures were implemented, including reducing unnecessary procedures, streamlining structures, and optimizing staffing, to enhance operational effectiveness and efficiency[12](index=12&type=chunk) - As of June 30, 2025, the Group operated **422 medical service points** covering various specialties, with a total of **810 doctors, dentists, and allied health professionals**[16](index=16&type=chunk) [Group Overview and Strategy](index=6&type=section&id=Group%20Overview%20and%20Strategy) The Group, a long-established and large-scale listed healthcare provider in Hong Kong and Mainland China, achieved profitability through cost control, operational optimization, and strategic partnerships, while actively expanding cross-border medical services in the Greater Bay Area - The Group is one of the longest-established and largest listed healthcare groups in Hong Kong, providing comprehensive healthcare services in both Hong Kong and Mainland China[12](index=12&type=chunk) - The Group optimized its Hong Kong chain clinic network, closing underperforming centers, aiming to open multi-clinic integrated medical centers in densely populated communities, and launched "General Practitioner Teleconsultation Services"[13](index=13&type=chunk) - The Group supports Hong Kong residents in accessing health check-ups and medical services in the Guangdong-Hong Kong-Macao Greater Bay Area and provides comprehensive concierge services for Mainland Chinese seeking medical treatment in Hong Kong, having signed a cooperation agreement with China Life Overseas Company Hong Kong Branch[14](index=14&type=chunk) - Plans are underway to build a full-cycle, integrated, one-stop healthcare service ecosystem connecting its chain clinics, medical imaging and diagnostic centers, health management centers, hospitals, and internet hospitals[14](index=14&type=chunk) [Hong Kong Operations](index=9&type=section&id=Hong%20Kong%20Operations) Hong Kong operations encompass medical services and network management, with the Group optimizing clinic layouts, launching teleconsultation, participating in government primary healthcare initiatives, and enhancing its Vio network through system upgrades and customized client services Hong Kong Business Revenue Contribution | Business Type | H1 2025 Revenue (HK$) | H1 2024 Revenue (HK$) | H1 2025 Revenue Share | H1 2024 Revenue Share | | :--- | :--- | :--- | :--- | :--- | | Medical Services | 377,546,000 | 394,462,000 | 41.91% | 43.14% | | Medical Network Management | 233,162,000 | 250,043,000 | 25.88% | 27.35% | [Medical Services](index=9&type=section&id=Medical%20Services) The Group provides general, specialist, dental, and allied health services in Hong Kong under "Quality HealthCare" and "CMH Medical" brands, actively participating in government primary healthcare schemes, optimizing clinic locations, and introducing teleconsultation services - Operates one of the largest and most comprehensive chain clinic networks in Hong Kong, offering general, specialist, dental, and allied health services under the "Quality HealthCare" and "CMH Medical" brands[17](index=17&type=chunk) - Actively responds to the government's primary healthcare development strategy, strengthening public-private collaboration to enhance accessibility of private medical services[17](index=17&type=chunk) - Optimized the layout of Hong Kong chain clinics, reopening three general practitioner clinics and one pediatric clinic in Lucky Plaza, Sha Tin, and adding a "Quality HealthCare Medical Centre" in Choi Hung[18](index=18&type=chunk) - Launched "General Practitioner Teleconsultation Services" to provide convenient consultations for customers in Hong Kong, with same-day free express delivery of medication[18](index=18&type=chunk) - Dental clinics participate in Phase II of the Pilot Scheme for Dental Services (Scaling) for Civil Servants and Eligible Persons, and joined the Pilot Scheme on Co-care for Adolescents' Oral Health[22](index=22&type=chunk) [Medical Network Management—Vio](index=12&type=section&id=Medical%20Network%20Management%E2%80%94Vio) Vio, the Group's managed care network in Hong Kong, boasts 77 years of experience, over 600 affiliated providers, and dual ISO certifications, continuously upgrading its information systems and operational processes to maintain market leadership amidst economic uncertainties - Vio has **77 years of extensive experience** and **over 600 affiliated service providers**, developing into a large and diversified primary and specialist medical network[23](index=23&type=chunk) - Vio is the first and only medical network in Hong Kong to simultaneously receive **dual ISO 9001:2015 Quality Management System and ISO 27001:2022 Information Security Management System certifications**[23](index=23&type=chunk) - Continuously invests resources to upgrade its information systems (e.g., web-CMS clinic management system) and optimize operational processes, providing efficient and environmentally friendly medical plan management services for blue-chip corporations, insurance companies, government departments, and public organizations[23](index=23&type=chunk) - Enhances employee belonging through a mentorship program and family-friendly culture, and provides regular training to strengthen customer service and data security awareness[24](index=24&type=chunk) [Mainland China Operations](index=13&type=section&id=Mainland%20China%20Operations) Mainland China operations primarily involve hospital and health management, with Nanshi Hospital enhancing services through a "headquarters + branches" model and AI-powered pre-assessment, while health management centers in Guangzhou, Shenzhen, and Jinan expand specialized services like assisted reproduction and cross-border medical care - Nanyang Xiangrui primarily operates Mainland China hospital management business, continuously providing professional management services to Nanshi Hospital, a national Grade III Class A hospital[25](index=25&type=chunk) - Nanshi Hospital's Internet Hospital has served over **1.5 million patient visits** since its launch in March 2022 until June 2025, and is piloting an "AI+ pre-assessment system"[25](index=25&type=chunk) - Nanshi Hospital's Oncology Department was selected as a **Henan Provincial Clinical Key Specialty** for 2024, and its Burn and Plastic Surgery Department was approved as a **National Clinical Key Specialty**[26](index=26&type=chunk) - Nanshi Hospital was listed in the "First Tier (Class A) Benchmark Hospitals for Socially Run Medical Institutions" and "Top 30 Socially Run Medical Institutions for Medical and Elderly Care Integration" in the **"2025 China Hospital Competitiveness Ranking"**[29](index=29&type=chunk) - The Group's health management centers in Guangzhou, Shenzhen, and Jinan operate stably, offering specialized services such as assisted reproduction, cross-border medical linkages, weight management, gastrointestinal management, and high-end health check-ups[30](index=30&type=chunk)[31](index=31&type=chunk) [Hospital Management Business](index=13&type=section&id=Hospital%20Management%20Business) Nanyang Xiangrui continues to provide professional management services to Nanshi Hospital, a national Grade III Class A hospital, enhancing operational efficiency and patient experience through a "headquarters + branches" model and an "AI+ pre-assessment system," achieving significant progress in specialized departments and advanced technology adoption - Nanshi Hospital's Internet Hospital has served over **1.5 million patient visits** since its launch in March 2022 until June 2025[25](index=25&type=chunk) - Nanshi Hospital's integrated management platform began piloting an "AI+ pre-assessment system" in February 2025, forming a new model of "experiential clinical + intelligent analysis"[25](index=25&type=chunk) - Nanshi Hospital's Pediatrics, Emergency Medicine, Urology, Cardiology, General Surgery, and Ophthalmology departments were selected as **Nanyang City "Clinical Key Specialties,"** and its Oncology Department was selected as a **Henan Provincial Clinical Key Specialty**[26](index=26&type:chunk) - Nanshi Hospital's Gamma Knife successfully passed the on-site acceptance inspection by the Henan Provincial Health Commission expert group, filling a gap in high-end radiotherapy in the southwestern Henan region[26](index=26&type:chunk) - Nanshi Hospital established a joint weight management clinic, breaking down disciplinary barriers to achieve multidisciplinary collaborative diagnosis and treatment, and upgraded its day surgery operating rooms to improve medical hardware facilities[27](index=27&type:chunk) [Health Management Business](index=15&type=section&id=Health%20Management%20Business) The Group's health management centers in Guangzhou, Shenzhen, and Jinan operate stably, expanding into assisted reproduction, cross-border medical linkages, and high-end physical examinations, while collaborating with quality medical institutions to offer diversified health management services - Guangzhou Integrated Outpatient Department strategically collaborates with nearby hospitals and reproductive medicine centers to provide peripheral services for assisted reproduction and women's life cycle healthcare, and introduced traditional Chinese medicine, rehabilitation, and chronic disease management programs[30](index=30&type:chunk) - Shenzhen Ganghe Clinic leverages its geographical advantages in the Guangdong-Hong Kong-Macao Greater Bay Area to promote cross-border medical collaboration and project implementation, offering specialized services such as weight management and gastrointestinal management[30](index=30&type:chunk) - Quality HealthCare International Health Management Center in Jinan serves China Life Insurance Company Limited Shandong Branch and regional corporate clients, providing comprehensive health management services primarily focused on high-end health check-ups[31](index=31&type:chunk) - In addition to health check-up services, Quality HealthCare International Health Management Center collaborates with quality medical institutions in the province to offer diversified health management services, including color Doppler ultrasound examinations, remote consultations, oral healthcare, traditional Chinese medicine healthcare, and chronic disease management[31](index=31&type:chunk) [Other Businesses](index=16&type=section&id=Other%20Businesses) TBMG, operating medical aesthetics and beauty wellness businesses, effectively reduced costs and improved operational efficiency by optimizing resource allocation, strategically adjusting its store network, expanding services, and upgrading its CRM system amidst increasing market competition - TBMG maintained a stable team size, employing **14 full-time and part-time doctors** (2024: 12 doctors)[32](index=32&type:chunk) - TBMG operates **11, 8, 8, and 3 stores** in Hong Kong, Shenzhen, Shanghai, and Guangzhou, respectively (2024: 13, 9, 9, and 3 stores)[32](index=32&type:chunk) - Through optimized resource allocation, costs were effectively reduced, and operational efficiency was improved, implementing strategic store network adjustments by consolidating overlapping or synergistic stores[32](index=32&type:chunk) - Continuously upgrades its customer relationship management system, leveraging a comprehensive database to understand customer consumption behavior characteristics, create personalized service solutions, and enhance customer satisfaction and repurchase rates[32](index=32&type:chunk) [Outlook](index=17&type=section&id=Outlook) Facing a complex macroeconomic environment, the Group will align with market trends, leverage synergies between Hong Kong and Mainland China operations, strengthen primary healthcare and specialist brand complementarity in Hong Kong, and enhance hospital efficiency and specialized health management in Mainland China - Slowing global economic growth and persistent geopolitical uncertainties continue to impact the Hong Kong and Mainland China markets to varying degrees[33](index=33&type:chunk) - Hong Kong's aging population exacerbates demand for primary healthcare, with the government's "Primary Healthcare Blueprint" increasing public-private collaboration, opening new avenues for private medical institutions to participate in public medical services[33](index=33&type:chunk) - Under the guidance of the "Healthy China 2030" policy, Mainland China continues to deepen medical reform, expand medical resource supply, and accelerate digital transformation, creating structural growth opportunities for the healthcare industry[33](index=33&type:chunk) - The Group will closely follow market trends, leverage the synergistic advantages of its Hong Kong and Mainland China operations, strengthen its primary healthcare layout and specialist brand complementarity, and empower medical network management through technology[33](index=33&type:chunk) [Macroeconomic Environment and Industry Opportunities](index=17&type=section&id=Macroeconomic%20Environment%20and%20Industry%20Opportunities) The first half of 2025 saw a complex macroeconomic environment in Hong Kong and Mainland China, with global slowdowns and geopolitical uncertainties, yet the healthcare sector found new growth opportunities through Hong Kong's Primary Healthcare Blueprint and Mainland China's "Healthy China 2030" policy - Slowing global economic growth and persistent geopolitical uncertainties continue to impact the Hong Kong and Mainland China markets to varying degrees[33](index=33&type:chunk) - Hong Kong's aging population exacerbates demand for primary healthcare, with the government's "Primary Healthcare Blueprint" increasing public-private collaboration, opening new avenues for private medical institutions to participate in public medical services[33](index=33&type:chunk) - Under the guidance of the "Healthy China 2030" policy, Mainland China continues to deepen medical reform, expand medical resource supply, and accelerate digital transformation, creating structural growth opportunities for the healthcare industry[33](index=33&type:chunk) [Hong Kong Business Outlook](index=18&type=section&id=Hong%20Kong%20Business%20Outlook) Hong Kong medical services will continue to support the government's Primary Healthcare Blueprint through public-private collaborations and multi-clinic integrated medical centers, while Vio will leverage its dual ISO certifications to deepen partnerships and optimize service processes - In medical services, the Group will leverage its rich medical resources to continue supporting the Hong Kong government's "Primary Healthcare Blueprint" by participating in more government-funded and public-private collaboration schemes[34](index=34&type:chunk) - Plans to open more multi-clinic integrated medical centers in densely populated communities to provide cost-effective medical services, and seeks to strengthen mutually beneficial synergies with its high-end integrated specialist brand "CMH Medical"[34](index=34&type:chunk) - In medical network management, Vio will fully leverage its competitive advantage as Hong Kong's only ISO-certified quality management and information security management medical network to further develop long-term partnerships with blue-chip corporations, insurance companies, government departments, and public organizations[35](index=35&type:chunk) - Vio will further optimize service processes, enhance environmental performance and customer satisfaction, and actively prepare to comply with the licensing requirements of the integrated clinic licensing system under the "Private Healthcare Facilities Ordinance"[35](index=35&type:chunk) [Mainland China Business Outlook](index=19&type=section&id=Mainland%20China%20Business%20Outlook) Mainland China hospital management will focus on differentiated competition and refined management, supporting Nanshi Hospital's integrated development through technological innovation and cost control, while health management will build a comprehensive service system, offering differentiated products and promoting an "insurance + health" ecosystem - Nanyang Xiangrui will deeply analyze the opportunities and challenges faced by socially run medical institutions and propose practical cost reduction and efficiency improvement strategies for Nanshi Hospital from multiple dimensions, including technological innovation, management optimization, cost control, and service upgrades[36](index=36&type:chunk) - The Group will continue to deepen the construction of its health management service system, precisely meeting diverse market health needs by creating differentiated health check-up product portfolios and innovative service models[36](index=36&type:chunk) - Will further strengthen resource integration and business synergy between its health management institutions and strategic partners in various regions, focusing on promoting the development of an "insurance + health" service ecosystem[36](index=36&type:chunk) [Other Business Outlook](index=19&type=section&id=Other%20Business%20Outlook) TBMG will implement a multi-dimensional development strategy, strategically reorganizing its store network, planning a new concept store in Hong Kong with international medical aesthetic equipment, upgrading its CRM system for enhanced customer satisfaction, and evaluating M&A targets for cross-border synergies - TBMG will enhance single-store efficiency through strategic reorganization of its store network and plans to establish a conceptual new store in the New Territories, Hong Kong, in the second half of 2025, introducing internationally leading medical aesthetic equipment and technology[37](index=37&type:chunk) - Will continue to invest resources in upgrading its customer relationship management system, utilizing big data to enhance customer satisfaction and retention rates, and promote customer conversion between beauty wellness and medical aesthetics[37](index=37&type:chunk) - TBMG will also evaluate high-quality M&A targets in Hong Kong and Mainland China, expand its ecosystem of strategic partners, and explore cross-border business synergy opportunities[37](index=37&type:chunk) [Liquidity and Financial Resources](index=19&type=section&id=Liquidity%20and%20Financial%20Resources) As of June 30, 2025, the Group maintained strong liquidity with total bank balances and deposits of approximately HK$1,410.3 million, net current assets of HK$1,306.1 million, a current ratio of 3.19, and a significantly reduced gearing ratio of 0.38%, adhering to prudent financial management Overview of Liquidity and Financial Resources | Indicator | June 30, 2025 (HK$) | December 31, 2024 (HK$) | | :--- | :--- | :--- | | Total Bank Balances and Deposits | 1,410,255,000 | 1,420,245,000 | | Bank Borrowings | 11,436,000 | 80,683,000 | | Unutilized Banking Facilities | 20,000,000 | 20,000,000 | | Net Current Assets | 1,306,142,000 | 1,300,647,000 | | Current Ratio | 3.19 | 3.19 | | Gearing Ratio | 0.38% | 2.71% | - The Group adopts a prudent cash and financial management policy, aiming to minimize borrowing levels and maintain sufficient internal resources to support business operations[39](index=39&type:chunk) - The Group's primary currencies for transactions are Hong Kong Dollars and Renminbis, and it considers the foreign exchange risk faced to be manageable, with regular reviews of exchange rate risks[40](index=40&type:chunk) - During the review period, the Group did not use any financial instruments for hedging activities[41](index=41&type:chunk) [Capital Structure](index=21&type=section&id=Capital%20Structure) As of June 30, 2025, equity attributable to owners of the Company increased to approximately HK$3,009.3 million from December 31, 2024 - As of June 30, 2025, the Group's equity attributable to owners of the Company was approximately **HK$3,009.31 million** (December 31, 2024: HK$2,976.91 million)[42](index=42&type:chunk) [Share Capital](index=21&type=section&id=Share%20Capital) Details of changes in the Company's share capital during the review period are provided in Note 22 to the condensed consolidated financial statements - Details of changes in the Company's share capital during the review period are provided in Note 22 to the condensed consolidated financial statements for the six months ended June 30, 2025[43](index=43&type:chunk) [Significant Investments, Acquisitions and Disposals](index=21&type=section&id=Significant%20Investments%2C%20Acquisitions%20and%20Disposals) The Group did not undertake any significant investment, acquisition, or disposal activities during the review period - During the review period, the Group did not have any significant investments, significant acquisitions, or disposals[44](index=44&type:chunk) [Pledge of Assets](index=21&type=section&id=Pledge%20of%20Assets) As of June 30, 2025, the Group pledged assets totaling approximately HK$29.9 million, including leasehold land and buildings and bank deposits, as collateral for mortgage loans and general banking facilities - As of June 30, 2025, certain assets pledged by the Group totaled approximately **HK$29.89 million** (December 31, 2024: HK$120.55 million)[45](index=45&type:chunk) - Collateral includes leasehold land and buildings of approximately **HK$28.88 million** (December 31, 2024: HK$30.44 million, and investment properties of approximately HK$89 million) as security for mortgage loans[45](index=45&type:chunk) - Bank deposits of approximately **HK$1.02 million** (December 31, 2024: HK$1.11 million) were pledged as security for general banking facilities[45](index=45&type:chunk) [Contingent Liabilities](index=21&type=section&id=Contingent%20Liabilities) As of June 30, 2025, the Group had no significant contingent liabilities - As of June 30, 2025, the Group had no significant contingent liabilities (December 31, 2024: nil)[46](index=46&type:chunk) [Litigation](index=22&type=section&id=Litigation) The Group initiated litigation against the vendors of Central Medical due to unmet profit guarantees, with revised claims of HK$172.96 million for FY2023 and HK$234.07 million for FY2024, with proceedings ongoing and outcomes uncertain - Central Medical Group's adjusted net profit for the year ended March 31, 2023, was **HK$23.47 million**, falling below the performance target of HK$30 million[48](index=48&type:chunk) - The buyer revised the original claim amount from HK$97.96 million to **HK$172.96 million**, with related litigation proceedings ongoing[48](index=48&type:chunk)[50](index=50&type:chunk) - Central Medical Group's actual adjusted net profit for the financial year ended March 31, 2024, was **HK$14.40 million**, falling below the performance target of HK$30 million[51](index=51&type:chunk) - The buyer has claimed **HK$234.07 million** from the defendants and has commenced litigation[52](index=52&type:chunk) - Due to the confidentiality of legal proceedings, the Company is currently unable to disclose further information and will issue further announcements in due course in accordance with the Listing Rules[50](index=50&type:chunk)[52](index=52&type:chunk) [Events After Reporting Period](index=24&type=section&id=Events%20After%20Reporting%20Period) No events with significant impact on the Group's business have occurred since June 30, 2025, other than those already disclosed in this report - Save as disclosed in this report, no events with significant impact on the Group have occurred since June 30, 2025[53](index=53&type:chunk) [Human Resources and Training Programs](index=24&type=section&id=Human%20Resources%20and%20Training%20Programs) As of June 30, 2025, the Group employed 1,388 staff with total employee costs of approximately HK$363.78 million, offering competitive remuneration, performance-based bonuses, specialized training, and a code of conduct to enhance service quality and professional development - As of June 30, 2025, the Group employed **1,388 staff** (December 31, 2024: 1,441 staff)[54](index=54&type:chunk) - Total employee costs for the six months ended June 30, 2025, were approximately **HK$363.78 million** (2024: HK$380.54 million)[54](index=54&type:chunk) - The Group's employees receive competitive salaries and benefits, with individual performance rewarded through the Group's salary and bonus scheme[54](index=54&type:chunk) - In addition to a strict code of conduct applicable to all employees, staff are provided with specialized training and manuals[54](index=54&type:chunk) [Use of Net Proceeds from Share Issuance](index=25&type=section&id=Use%20of%20Net%20Proceeds%20from%20Share%20Issuance) The Group adjusted the use and timeline of net proceeds from two share issuances to better respond to the business environment and capitalize on global healthcare opportunities, terminating the "one-stop IT online platform" development and reallocating funds to hospital and medical institution acquisitions, investments, and development - The Board resolved to extend the timeline for utilizing the unutilized balance of the first tranche of net proceeds from end-2023 to **end-2026**[57](index=57&type:chunk) - One of the originally intended uses, "development of a 'one-stop IT online platform'," has been terminated, and its remaining unutilized balance of approximately **HK$62 million** has been reallocated for "acquisition, investment, and development of hospitals and medical institutions, and medical or health-related businesses"[57](index=57&type:chunk) - The original intended use of the unutilized balance of the second tranche of net proceeds will be changed to allow the entire unutilized balance of **HK$996 million** to be used for "acquisition, investment, and development of medical and health-related businesses for providing medical, dental, rehabilitation, nursing, elderly care, health check-up, laboratory testing, medical diagnosis, managed care, and medical tourism services"[62](index=62&type:chunk) [Issuance of Subscription Shares and Convertible Preference Shares](index=25&type=section&id=Issuance%20of%20Subscription%20Shares%20and%20Convertible%20Preference%20Shares) Net proceeds of approximately HK$880 million from 2014 share and convertible preference share issuances, originally for Mainland China medical market expansion, Hong Kong specialist centers, dental clinics, and an IT platform, have been reallocated for hospital and medical institution acquisitions, investments, and development, with the IT platform project terminated and geographical restrictions removed, extending the utilization timeline to end-2026 - The net proceeds from the ordinary share subscription and convertible preference share subscription totaled approximately **HK$880 million**[55](index=55&type:chunk) Original Use and Utilized Status of First Tranche of Net Proceeds (as of December 31, 2023) | Use | Amount (HK$ million) | Total Utilized (HK$ million) | Unutilized Balance (HK$ million) | | :--- | :--- | :--- | :--- | | Acquisition, investment, and development of hospitals and medical institutions in Mainland China, and medical or health-related businesses in Hong Kong | 650 | 602 | 48 | | Investment and development of multiple specialist medical centers in Hong Kong and a chain dental clinic in Mainland China | 150 | 13 | 137 | | Development of a "one-stop IT online platform" to integrate the Group's continuously developing diverse medical and healthy living businesses | 80 | 18 | 62 | | **Total** | **880** | **633** | **247** | - The remaining unutilized balance of approximately **HK$62 million**, originally allocated for platform development, has been reallocated for "acquisition, investment, and development of hospitals and medical institutions, and medical or health-related businesses," with geographical restrictions removed[57](index=57&type:chunk) - As of June 30, 2025, the unutilized first tranche of net proceeds was approximately **HK$127 million**[59](index=59&type:chunk) [Issuance of Shares to China Life Insurance](index=28&type=section&id=Issuance%20of%20Shares%20to%20China%20Life%20Insurance) Net proceeds of approximately HK$1,746 million from 2015 share issuance to China Life Insurance, initially for Mainland China dental, hospital, rehabilitation, and health check businesses, have been entirely reallocated to acquire, invest in, and develop medical and health-related businesses across various services, with geographical restrictions removed and the utilization timeline extended to end-2026 - The net proceeds from the issuance of shares to China Life Insurance were approximately **HK$1,746 million**[60](index=60&type:chunk) Original Use and Utilized Status of Second Tranche of Net Proceeds (as of December 31, 2023) | Use | Amount (HK$ million) | Total Utilized (HK$ million) | Unutilized Balance (HK$ million) | | :--- | :--- | :--- | :--- | | Development of dental chain businesses and investment or acquisition of dental clinics and/or hospitals in Mainland China; development or acquisition of medical clinics; development of hospitals, investment or acquisition of public or private hospitals; development or acquisition of rehabilitation specialist hospitals and (if applicable) nursing homes and/or elderly care homes | 1,500 | 646 | 854 | | Development or acquisition of businesses providing health check-up, laboratory testing, and medical diagnostic services in Mainland China | 150 | 104 | 46 | | Development of managed care businesses and cross-border medical tourism platforms in Mainland China | 96 | 0 | 96 | | **Total** | **1,746** | **750** | **996** | - It was resolved to extend the timeline for utilizing the unutilized balance of the second tranche of net proceeds from end-2023 to **end-2026**[62](index=62&type:chunk) - The entire unutilized balance of **HK$996 million** of these net proceeds will be used for "acquisition, investment, and development of medical and health-related businesses for providing medical, dental, rehabilitation, nursing, elderly care, health check-up, laboratory testing, medical diagnosis, managed care, and medical tourism services," with geographical restrictions removed[62](index=62&type:chunk) - As of June 30, 2025, the unutilized second tranche of net proceeds was approximately **HK$912 million**[62](index=62&type:chunk) [Issuance of Convertible Bonds](index=30&type=section&id=Issuance%20of%20Convertible%20Bonds) The Group issued HK$356 million in convertible bonds in 2022 for the Central Medical acquisition, with Series A and B fully redeemed, and Series C, with an outstanding principal of HK$116 million, maturing on August 26, 2025, which, if fully converted, would result in a minor dilution of approximately 2.25% of the issued share capital - The Company paid **HK$120 million** in cash to the vendors and issued convertible bonds totaling **HK$356 million** in three tranches to the vendors' nominees on August 26, 2022[63](index=63&type:chunk)[66](index=66&type:chunk) - The convertible bonds carry conversion rights, allowing the outstanding principal amount to be converted into conversion shares at a conversion price of **HK$0.76 per share**[63](index=63&type:chunk) - As of June 30, 2025, Series A and B convertible bonds have been fully redeemed, and the outstanding principal amount of convertible bonds is **HK$116 million** (Series C)[64](index=64&type:chunk)[66](index=66&type:chunk) - Assuming the outstanding convertible bonds of **HK$116 million** are fully converted at a conversion price of HK$0.76 per share, a maximum of **152,631,579 conversion shares** will be issued, representing approximately **2.25%** of the Company's issued share capital as of June 30, 2025[65](index=65&type:chunk) Major Shareholder Equity Dilution Impact (Assuming Full Conversion of Convertible Bonds) | Shareholder Name | Equity Immediately Before Exercise of Conversion Rights (Approx. %) | Equity Immediately After Exercise of Conversion Rights (Approx. %) | | :--- | :--- | :--- | | China Life Insurance | 26.35% | 25.77% | | Broad Idea | 20.94% | 20.48% | | Choi Ka Tsan | 28.21% | 27.59% | | Dr. Choi | 20.95% | 20.49% | | Classictime | 12.26% | 11.99% | | Win Group | 12.26% | 11.99% | | Kwok Wai King | 5.28% | 5.17% | - The Company expects to be able to meet its redemption obligations under the outstanding convertible bonds[67](index=67&type:chunk) [Disclosure of Interests](index=31&type=section&id=Disclosure%20of%20Interests) Details the interests and short positions of directors, chief executives, and major shareholders in the Company's shares, underlying shares, and debentures as of June 30, 2025 [Directors' and Chief Executive's Interests and Short Positions in Shares, Underlying Shares and Debentures](index=32&type=section&id=Directors'%20and%20Chief%20Executive's%20Interests%20and%20Short%20Positions%20in%20Shares%2C%20Underlying%20Shares%20and%20Debentures) As of June 30, 2025, Mr. Choi Ka Tsan held 1,911,136,764 shares, representing approximately 28.21% of the Company's equity, including shares held by his controlled corporation, Broad Idea Mr. Choi Ka Tsan's Long Position in Shares | Shareholder Name | Capacity | Number of Shares Held | Total Number of Shares Held | Approximate Percentage of Company's Equity | | :--- | :--- | :--- | :--- | :--- | | Choi Ka Tsan | Interest of controlled corporation | 1,418,576,764 | 1,911,136,764 | 28.21% | | | Beneficial owner | 492,560,000 | | | - Mr. Choi Ka Tsan and Dr. Choi are deemed to be interested in the **1,418,576,764 shares** held by Broad Idea[71](index=71&type:chunk) - Save as disclosed above, as of June 30, 2025, no director or chief executive of the Company had any interests or short positions in the shares, underlying shares, or debentures of the Company or any of its associated corporations that were required to be recorded in the register kept by the Company under Section 352 of the Securities and Futures Ordinance, or otherwise notified to the Company and the Stock Exchange under the Standard Code[70](index=70&type:chunk) [Directors' Rights to Acquire Shares or Debentures](index=33&type=section&id=Directors'%20Rights%20to%20Acquire%20Shares%20or%20Debentures) During the six months ended June 30, 2025, no arrangements were made by the Company or its affiliates for directors, chief executives, or their associates to benefit from acquiring shares or debentures of the Company or any other body corporate - At no time during the six months ended June 30, 2025, had the Company, its subsidiaries, fellow subsidiaries, or holding company entered into any arrangements that would enable the directors or chief executive of the Company or their respective spouses or children under 18 years of age to acquire benefits by means of the acquisition of shares or debentures of the Company or any other body corporate[72](index=72&type:chunk) [Major Shareholders' Interests and Short Positions in Shares and Underlying Shares](index=33&type=section&id=Major%20Shareholders'%20Interests%20and%20Short%20Positions%20in%20Shares%20and%20Underlying%20Shares) As of June 30, 2025, major shareholders, excluding directors and chief executives, included China Life Insurance, Broad Idea, Mr. Choi Ka Tsan, Dr. Choi, Classictime, Win Group, and Ms. Kwok Wai King, holding interests in the Company's shares or underlying shares Major Shareholders' Long Positions in Shares (as of June 30, 2025) | Shareholder Name/Name | Capacity | Number of Shares Held | Total Number of Shares Held | Approximate Percentage of Company's Equity | | :--- | :--- | :--- | :--- | :--- | | China Life Insurance | Beneficial owner | 1,785,098,644 | 1,785,098,644 | 26.35% | | Broad Idea | Beneficial owner | 1,418,576,764 | 1,418,576,764 | 20.94% | | Choi Ka Tsan | Interest of controlled corporation | 1,418,576,764 | 1,911,136,764 | 28.21% | | | Beneficial owner | 492,560,000 | | | | Dr. Choi | Interest of controlled corporation | 1,418,576,764 | 1,419,198,764 | 20.95% | | | Beneficial owner | 622,000 | | | | Classictime | Beneficial owner | 830,742,000 | 830,742,000 | 12.26% | | Win Group | Interest of controlled corporation | 830,742,000 | 830,742,000 | 12.26% | | Kwok Wai King | Beneficial owner | 356,164,000 | 357,874,000 | 5.28% | | | Jointly interested with another person | 1,710,000 | | | - Mr. Choi Ka Tsan and Dr. Choi are deemed to be interested in the **1,418,576,764 shares** held by Broad Idea[77](index=77&type:chunk) - Win Group is deemed to be interested in the **830,742,000 shares** held by Classictime[77](index=77&type:chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=34&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20the%20Company's%20Listed%20Securities) Neither the Company nor any of its subsidiaries purchased, sold, or redeemed any listed securities during the review period - During the review period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any listed shares[76](index=76&type:chunk) [Corporate Governance](index=34&type=section&id=Corporate%20Governance) Outlines the Company's commitment to maintaining high corporate governance standards, compliance with codes, and the roles of its audit committee and auditor [Corporate Governance Standards](index=35&type=section&id=Corporate%20Governance%20Standards) The Board is committed to upholding strong corporate governance standards to foster long-term sustainable growth and deliver value to all stakeholders, believing it safeguards shareholder interests, enhances corporate value, manages risks, and increases transparency - The Board is committed to maintaining good corporate governance standards, aiming to create long-term sustainable growth for shareholders and provide long-term value to all stakeholders[78](index=78&type:chunk) - Good corporate governance standards provide the Group with a framework for safeguarding shareholder interests, enhancing corporate value, formulating its business strategies and policies, managing relevant risks through effective internal control systems, and increasing the Group's transparency and accountability to shareholders and creditors[78](index=78&type:chunk) [Auditor](index=35&type=section&id=Auditor) UHY CPA Limited has served as the Group's auditor since February 15, 2018, and has been re-appointed at successive annual general meetings - UHY CPA Limited has been the Group's auditor since **February 15, 2018**[79](index=79&type:chunk) - The Company has re-appointed UHY CPA Limited as its auditor at successive annual general meetings[79](index=79&type:chunk) [Compliance with Corporate Governance Code](index=35&type=section&id=Compliance%20with%20Corporate%20Governance%20Code) During the review period, the Company complied with the Corporate Governance Code, except for the combined roles of Chairman and Chief Executive held by Mr. Choi Ka Tsan, an arrangement the Board believes ensures consistent leadership and operational efficiency without compromising power balance due to a majority of non-executive and independent non-executive directors - During the review period, the Company complied with the code provisions set out in Appendix C1 of the Listing Rules' Corporate Governance Code, except for the combined roles of Chairman and Chief Executive Officer held by Mr. Choi Ka Tsan[80](index=80&type:chunk) - The Board believes that combining the roles of Chairman and Chief Executive Officer ensures consistent leadership for formulating and advancing long-term strategies and helps optimize the Group's operational efficiency[80](index=80&type:chunk) - With four non-executive directors and six independent non-executive directors forming a majority on the 14-member Board, the Board believes this arrangement does not compromise the balance of power between the Board and the Group's management[80](index=80&type:chunk) [Compliance with Standard of Dealings in Securities](index=36&type=section&id=Compliance%20with%20Standard%20of%20Dealings%20in%20Securities) The Company adopted the Standard of Dealings in Securities as a code of conduct for directors' securities transactions, and all directors confirmed compliance during the six months ended June 30, 2025 - The Company has adopted the Standard of Dealings in Securities set out in Appendix C3 of the Listing Rules as a code of conduct for directors' securities transactions[82](index=82&type:chunk) - Following specific inquiries with all directors, all directors confirmed compliance with the required standards set out in the Standard of Dealings in Securities during the six months ended June 30, 2025[82](index=82&type:chunk) [Sufficient Public Float](index=36&type=section&id=Sufficient%20Public%20Float) As of the date of this interim report, the Company maintains a sufficient public float as required by the Listing Rules - As of the date of this interim report, based on publicly available information and to the best of the directors' knowledge, the Company maintains a sufficient public float as required by the Listing Rules[83](index=83&type:chunk) [Changes in Directors' Information](index=36&type=section&id=Changes%20in%20Directors'%20Information) No changes in directors' and chief executive's information requiring disclosure under Listing Rule 13.51B(1) occurred, except for Mr. Choi Ka Tsan, Chairman and Chief Executive, being awarded the Gold Bauhinia Star on July 1, 2025 - Mr. Choi Ka Tsan, Chairman and Chief Executive Officer and Executive Director of the Company, was awarded the **Gold Bauhinia Star** by the Government of the Hong Kong Special Administrative Region of the People's Republic of China on July 1, 2025[84](index=84&type:chunk) - No other changes in the information of the Company's directors and chief executive officer are required to be disclosed under Listing Rule 13.51B(1)[84](index=84&type:chunk) [Audit Committee](index=36&type=section&id=Audit%20Committee) As of June 30, 2025, the Audit Committee, comprising three independent non-executive directors and one non-executive director, reviewed the Group's accounting principles, internal controls, and financial reporting matters, including this interim report, in conjunction with management - As of June 30, 2025, the Audit Committee comprised three independent non-executive directors (Mr. Chan Wai Kun, Dr. Xu Weiguo, and Mr. Cheung Ka Ming) and one non-executive director (Mr. Liu Yang)[85](index=85&type:chunk) - The Audit Committee, in conjunction with management, reviewed the accounting principles and practices adopted by the Group and discussed matters related to internal controls and financial reporting, including the review of the Group's unaudited condensed consolidated financial statements and this interim report for the six months ended June 30, 2025[85](index=85&type:chunk) [Review of Interim Results](index=36&type=section&id=Review%20of%20Interim%20Results) The Group's condensed consolidated financial information for the six months ended June 30, 2025, though unaudited, was reviewed by the Audit Committee and by UHY CPA Limited in accordance with Hong Kong Standard on Review Engagements 2410 - The Group's condensed consolidated financial information for the six months ended June 30, 2025, is unaudited but has been reviewed by the Audit Committee[86](index=86&type:chunk) - UHY CPA Limited has reviewed the Group's condensed consolidated interim financial statements for the six months ended June 30, 2025, in accordance with Hong Kong Standard on Review Engagements 2410 "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Hong Kong Institute of Certified Public Accountants[86](index=86&type:chunk) [Independent Auditor's Review Report](index=36&type=section&id=Independent%20Auditor's%20Review%20Report) Presents the independent auditor's conclusion on the condensed consolidated financial statements for the six months ended June 30, 2025 [Independent Auditor's Review Report](index=37&type=section&id=Independent%20Auditor's%20Review%20Report) UHY CPA Limited reviewed the Group's condensed consolidated financial statements for the six months ended June 30, 2025, in accordance with HKSRS 2410, concluding that nothing came to their attention suggesting the statements were not prepared in all material respects according to HKAS 34 - The auditor has reviewed the condensed consolidated financial statements of Quality HealthCare Medical Services Group Limited and its subsidiaries on pages 38 to 77[88](index=88&type:chunk) - The review was conducted in accordance with Hong Kong Standard on Review Engagements 2410 issued by the Hong Kong Institute of Certified Public Accountants, which is substantially less in scope than an audit, and therefore no audit opinion is expressed[89](index=89&type:chunk) - Based on the review, nothing came to the auditor's attention that causes them to believe that the condensed consolidated financial statements as of June 30, 2025, are not prepared in all material respects in accordance with Hong Kong Accounting Standard 34[90](index=90&type:chunk) [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=38&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) Provides a summary of the Group's financial performance, including revenue, profit or loss, and other comprehensive income for the reporting period [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=39&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) For the six months ended June 30, 2025, the Group achieved a profit of HK$35.59 million, a significant improvement from the prior year's loss of HK$28.54 million, with profit attributable to owners at HK$12.73 million and total comprehensive income of HK$74.90 million Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income Summary | Indicator | 2025 (HK$ '000) | 2024 (HK$ '000) | | :--- | :--- | :--- | | Revenue | 900,923 | 914,280 | | Gross Profit | 230,179 | 249,553 | | Profit (Loss) for the Period | 35,593 | (28,542) | | Profit (Loss) for the Period Attributable to Owners of the Company | 12,727 | (47,676) | | Total Comprehensive Income (Expense) for the Period | 74,903 | (84,006) | | Earnings (Loss) Per Share (HK cents) | 0.19 | (0.70) | - Total other comprehensive income (expense) was **HK$39.31 million**, primarily comprising exchange differences arising from translation of foreign operations of **HK$34.70 million** and fair value changes on revaluation of investment properties of **HK$5.72 million**[93](index=93&type:chunk) [Condensed Consolidated Statement of Financial Position](index=40&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) Presents a snapshot of the Group's assets, liabilities, and equity as of the reporting date, reflecting its financial health [Condensed Consolidated Statement of Financial Position](index=41&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the Group reported total assets of HK$4,103.55 million, total liabilities of HK$666.65 million, and total equity of HK$3,436.90 million, maintaining a robust financial position with net current assets of HK$1,306.14 million and a current ratio of 3.19 Condensed Consolidated Statement of Financial Position Summary | Indicator | June 30, 2025 (HK$ '000) | December 31, 2024 (HK$ '000) | | :--- | :--- | :--- | | Non-current Assets | 2,200,713 | 2,232,058 | | Current Assets | 1,902,840 | 1,894,845 | | **Total Assets** | **4,103,553** | **4,126,903** | | Current Liabilities | 596,698 | 594,198 | | Non-current Liabilities | 69,955 | 152,358 | | **Total Liabilities** | **666,653** | **746,556** | | Equity Attributable to Owners of the Company | 3,009,308 | 2,976,914 | | Non-controlling Interests | 427,592 | 403,433 | | **Total Equity** | **3,436,900** | **3,380,347** | | Net Current Assets | 1,306,142 | 1,300,647 | - Non-current assets primarily include investment properties, property, plant and equipment, goodwill, intangible assets, and interests in associates[94](index=94&type:chunk) - Current assets primarily include trade and other receivables, and bank balances and cash[94](index=94&type:chunk) - Current liabilities primarily include trade and other payables, and convertible bonds[95](index=95&type:chunk) [Condensed Consolidated Statement of Changes in Equity](index=42&type=section&id=Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) Details the changes in the Group's equity attributable to owners and non-controlling interests over the reporting period [Condensed Consolidated Statement of Changes in Equity](index=43&type=section&id=Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) For the six months ended June 30, 2025, equity attributable to owners increased from HK$2,976.91 million to HK$3,009.31 million, primarily due to a period profit of HK$12.73 million and exchange differences from foreign currency translation Condensed Consolidated Statement of Changes in Equity Summary | Item | June 30, 2025 (HK$ '000) | June 30, 2024 (HK$ '000) | | :--- | :--- | :--- | | Equity Attributable to Owners of the Company (Beginning of Period) | 2,976,914 | 3,242,129 | | Profit (Loss) for the Period | 12,727 | (47,676) | | Exchange Differences Arising from Translation of Foreign Operations | 23,181 | (28,673) | | Fair Value Changes on Revaluation of Property | 5,720 | – | | Fair Value Changes on Revaluation of Investments | (1,106) | (22,422) | | Dividends Declared | (8,128) | (8,128) | | Dividends Paid to Non-controlling Interests | (10,222) | (1,887) | | **Equity Attributable to Owners of the Company (End of Period)** | **3,009,308** | **3,137,907** | | Non-controlling Interests (End of Period) | 427,592 | 386,818 | | **Total Equity (End of Period)** | **3,436,900** | **3,524,725** | - Profit for the period was **HK$12.73 million**, and profit attributable to non-controlling interests was **HK$22.87 million**[96](index=96&type:chunk) - Exchange differences arising from translation of foreign operations were **HK$23.18 million**, and fair value changes on revaluation of properties transferred from "property, plant and equipment" to "investment properties" were **HK$5.72 million**[96](index=96&type:chunk) [Condensed Consolidated Statement of Cash Flows](index=44&type=section&id=Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) Summarizes the cash inflows and outflows from operating, investing, and financing activities for the reporting period [Condensed Consolidated Statement of Cash Flows](index=45&type=section&id=Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) For the six months ended June 30, 2025, the Group generated HK$78.48 million net cash from operations and HK$94.47 million net cash from investing activities, while utilizing HK$123.24 million in financing activities, resulting in a net increase of HK$49.71 million in cash and cash equivalents Condensed Consolidated Statement of Cash Flows Summary | Item | 2025 (HK$ '000) | 2024 (HK$ '000) | | :--- | :--- | :--- | | Net Cash Generated from Operating Activities | 78,478 | 141,587 | | Net Cash from (Used in) Investing Activities | 94,472 | (236,943) | | Net Cash Used in Financing Activities | (123,236) | (174,600) | | Net Increase (Decrease) in Cash and Cash Equivalents | 49,714 | (269,956) | | Cash and Cash Equivalents at January 1 | 1,191,397 | 1,032,079 | | Effect of Exchange Rate Changes | 12,524 | (13,347) | | Cash and Cash Equivalents at June 30 | 1,253,635 | 748,776 | - Net cash from investing activities shifted from a net outflow in 2024 to a net inflow in 2

Financial Performance - For the first half of 2025, the company recorded revenue of RMB 2,601.07 million, a decrease of RMB 174.93 million or 6.3% compared to RMB 2,776.00 million in the same period last year[11]. - The company's gross profit was RMB 338.59 million, an increase of 12.3% year-on-year, resulting in a gross profit margin of 13.0%, up 2.1 percentage points from the previous year[12]. - Net profit attributable to shareholders was RMB 37.10 million, a significant increase of RMB 34.68 million compared to the same period last year[12]. - Revenue for the period was approximately RMB 2.601 billion, a decrease of RMB 175 million or 6.3% compared to RMB 2.776 billion in the same period last year[47]. - Gross profit was approximately RMB 339 million, an increase of RMB 37 million or 12.3% from RMB 302 million in the previous year, with a gross margin of 13.0%, up from 10.9%[46][50]. - The company reported a net profit margin of 1.4%[54]. - The company’s earnings for the period were RMB 37,095,000, compared to a loss of RMB 548,000 in the previous period, indicating a turnaround in profitability[102]. Revenue Breakdown - Revenue from the Chinese market was RMB 1,295.53 million, a slight decrease of 0.06%, accounting for 49.8% of total revenue[13]. - Revenue from overseas markets was RMB 1,305.55 million, down 11.8%, accounting for 50.2% of total revenue[13]. - Revenue from the Middle East market increased by 32.1% to RMB 1,029.81 million, representing 39.6% of total revenue for the first half of 2025[13]. - Revenue from land drilling machines was RMB 801.45 million, a decrease of 7.8% year-on-year, accounting for 30.8% of total revenue for the first half of 2025[20][21]. - Revenue from the marine segment increased by 35.0% year-on-year to RMB 616.94 million, representing 23.7% of total revenue[20][21]. - The drilling engineering services segment generated revenue of RMB 174.51 million, accounting for 6.7% of total revenue, a slight increase of 0.4% compared to RMB 173.80 million in the same period of 2024[28]. - Revenue from the offshore wind power business generated revenue of RMB 353.75 million, accounting for 57.3% of the marine segment's revenue, a decline of 18.9% from RMB 436.38 million in 2024[32]. Cost Management - The company reduced financing costs by 0.89 percentage points to 2.5%, with interest expenses decreasing by 27.5%[12]. - Sales costs were approximately RMB 2.262 billion, a decrease of RMB 212 million or 8.6% from RMB 2.474 billion in the previous year[48]. - The group's distribution expenses for the period were approximately RMB 75 million, a decrease of RMB 5 million or 6.8% compared to the same period last year[51]. - The group's financial expenses net amount was approximately RMB 41 million, a decrease of RMB 28 million or 40.5% compared to the same period last year, due to improved financing structure[51]. Operational Efficiency - The average turnover days for accounts receivable decreased by 67 days to 201 days, while inventory turnover days decreased by 18 days to 126 days[12]. - Operating cash flow net amount increased significantly by 132.4% year-on-year, reaching approximately RMB 93.67 million[12]. - The company aims to optimize its business structure and focus on core business areas to enhance overall profitability[47]. - The company has successfully passed the API Q2 certification, enhancing its service quality in the oil and gas industry[43]. Research and Development - The group applied for 55 patents during the reporting period, including 30 invention patents, bringing the total effective patents to 859 as of June 30, 2025[18]. - The group's R&D expenses were approximately RMB 77 million, an increase of RMB 19 million or 31.8% year-on-year, reflecting a continued investment in automation and digitalization[51]. - The company will maintain a research and development investment intensity of about 5% to support technological innovation and high-end development[45]. Market Strategy - The company plans to strengthen its market position in the Middle East and expand into emerging markets, particularly in offshore drilling platforms and marine wind power[42]. - The company is focusing on technological breakthroughs in core areas such as drilling and completion equipment, marine engineering equipment, and digital products[44]. - The group aims to enhance its core competitiveness in high-end shipbuilding by entering the high-end scientific research vessel construction market[17]. Corporate Governance - The company has adopted the Corporate Governance Code as a standard for its corporate governance practices, emphasizing a high-quality board and effective internal controls[72]. - As of June 30, 2025, the board has complied with the requirement of having at least three independent non-executive directors, constituting at least one-third of the board[76]. - The Audit Committee, consisting of three members including two independent non-executive directors, is responsible for reviewing the adequacy and effectiveness of the company's financial reporting and internal control systems[77]. Shareholder Information - Major shareholders include Tricor Equity Trustee Limited with 491,576,295 shares (5.44% of issued share capital) and Dongfang Electric Group International Investment Co., Ltd. with 5,290,494,251 shares (58.52% of issued share capital)[84]. - The company has authorized a total of 513,742,090 stock options under the 2017 stock option plan, which represents approximately 5.68% of the issued share capital as of June 30, 2025[87]. - The company did not recommend the distribution of interim dividends for the six months ended June 30, 2025, consistent with the decision for the same period in 2024[127]. Financial Position - As of June 30, 2025, the group's total liabilities were approximately RMB 9.055 billion, with a debt-to-asset ratio of 71.2%, an increase of 1.9 percentage points from December 31, 2024[62]. - The group's total equity as of June 30, 2025, was approximately RMB 3.655 billion, a decrease of RMB 10 million from December 31, 2024[63]. - The company reported a significant increase in procurement of components from related parties, totaling RMB 332,488,000 for the six months ended June 30, 2025, compared to RMB 189,944,000 in the same period of 2024, representing an increase of approximately 75%[151].