AI assistant
SIM Technology Group Limited Interim / Quarterly Report 2025
50331_rns_2025-09-18_c523addd-f36a-4afb-9f6b-382ddedae764.pdf
Interim / Quarterly Report
Open in viewerOpens in your device viewer
SIM
SIM Technology
SIM Technology Group Limited
( Incorporated in Bermuda with limited liability )
( Stock Code : 2000 )
CHAIRMAN'S STATEMENT
On behalf of the board ("Board") of the directors ("Directors") of SIM Technology Group Limited ("Company"), I am presenting the interim results of the Company and its subsidiaries (collectively referred to as the "Group") for the six months ended 30 June 2025 ("1H-2025").
BUSINESS REVIEW
In 1H-2025, the Group achieved significant results in strengthening internal management and cost controls. At the same time, the negative impact of issues left over from the past, including clearance of aged inventory and the handling of personnel-related matters, on the performance during the current period was substantially reduced, thus enabling the Group to essentially turn around its operating results from losses to profits during the reporting period.
The turnover of the Group for 1H-2025 reached HK$208.2 million, representing an increase of 13.4% as compared to the same period last year. Gross profit amounted to HK$45.3 million, representing an increase of 18.3% as compared to the same period last year. The handsets and IOT terminals business recorded a modest profit of approximately HK$0.6 million, driven by further cost and expense control. Shanghai Zhenkang Electronics Limited, a non-wholly owned subsidiary of the Group, engaged in the automotive intelligent products business, incurred a loss of HK$14.8 million due to the cancellation of expected customer orders, resulting in the loss of a significant portion of anticipated revenue. The rental income from investment properties remained largely stable during the reporting period. However, based on the judgment of the future rental market and the actual leases of the Group, the valuer made an impairment of HK$14.7 million, resulting in a loss of HK$2.0 million for the leasing business. During the reporting period, the Group's interest income and foreign exchange gains contributed positively to the Group's profit and loss for the current period. After accounting for all factors, the Group recorded a profit attributable to the owners of the Company of HK$8.8 million for 1H-2025.
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
CHAIRMAN'S STATEMENT
Handsets and IOT terminals business
This segment generated a turnover of HK$174.3 million in 1H-2025, representing an increase of 11.5% as compared to the same period last year. Gross profit also rose to HK$24.7 million, marking a growth as compared to the same period last year. The strategy of "Balancing income and expenditures, and managing costs" implemented in 2024 continued to deliver results. Through the optimization of team structure, tight control on costs and expenses, and the effective utilisation of external resources, operating costs were brought under control. The segment turned around from loss to profit for the first time in years. The management, however, remains cognizant of the fact that despite achieving a moderate profit during the reporting period, the overall situation remains precarious. Sales from businesses have remained subdued in recent years with a significant shortage of quality clients and projects, as well as difficulty in expanding overseas market. With the industry competition growing increasingly fierce, slim margins may eventually fail to cover operating costs and expenses if this trend continues. The top-priority task is to explore new business tracks and identify fresh growth drivers for this business.
The era of AI has arrived. Integrating AI technology with traditional hardware terminals to upgrade and remodel products and address pain points of and demands from consumers has become a crucial direction of development. In 1H-2025, the Group has invested significant resources in AI-powered glasses, companion smart robots, and high-computing-power control modules for humanoid robots. These efforts have already accumulated certain technological assets. The Group is committed to scaling up its investment in these emerging areas, grabbing market shares, accelerating its scale of operation and unlocking new growth drivers for its core business.
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
SHI TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
CHAIRMAN'S STATEMENT
Automotive intelligent product business
In 1H-2025, this segment recorded turnover of HK$12.9 million and a gross profit of approximately HK$2.1 million. Following a significant loss recorded in 2024, the business still reported a loss of HK$14.8 million in 1H-2025.
The Group operates in the field of in-vehicle infotainment for new energy vehicles (NEVs), comprising multi-display panels and domain controllers. As one of the most critical components of NEVs, this segment features extremely high entry barriers. After years of development and with tens of millions of dollars in investment, the in-vehicle infotainment developed for a Japanese joint-venture branded customer successfully passed their rigorous certification and entered into mass production for delivery. The customer had previously projected 600 million dollars' worth orders for the three-year period from 2024 to 2026. However, amid the heavy impact from intense and irrational competition across the automotive industry, manufacturers cut the prices and sell at a loss and compete to sell off their inventory. Against this backdrop, the customers of the Company were forced to revise its sales plan and ultimately the demand for this in-vehicle infotainment was reduced to nil in 2025. In response to this development, the management promptly activated an emergency cost-control plan. While ensuring stable delivery and after-sales support for existing orders, non-essential expenditures were reduced to the bare minimum. Although the turnover for the second half of 2025 is expected to be minimal, the substantial reduction in the manpower as well as costs and expenses is anticipated to keep losses within a manageable range.
Property management
In 1H-2025, the revenue of property management was mainly derived from the leasing of SIM Technology Building Block A and Block B in Shanghai, factory units in Shenyang, and commercial properties in Shenyang. A total area of approximately 78,000 square meters was leased out. To utilize our resources more effectively and develop the property management business, the Group will continue to lease the spare space at its factories and other buildings.
The revenue of properties management for 1H-2025 amounted to HK$21.0 million (1H-2024: HK$22.2 million) with a gross profit margin of 88.1% (1H-2024: 90.3%).
3
CHAIRMAN'S STATEMENT
Prospects
In the second half of 2025, the global economic and trade environment is expected to remain complex and uncertain, with intensifying competition in both domestic and international markets. The Group will adopt a more cautious stance in navigating market challenges, while proactively exploring new growth directions and accelerating its layout in emerging sectors with profitability as our baseline.
The Group will optimize its organizational structure by forming sales teams comprising product and technical experts to strengthen its marketing capabilities and competitiveness at the customer end. Meanwhile, adjustments to the structure of research and development (R&D) centers will be implemented to boost its R&D efficiency and reduce its product costs.
The Group has successfully entered the segments of AI glasses and companion smart robots, and has completed the R&D of integrated solutions. Market expansion efforts will follow in phases, and these "terminal + AI" products are expected to begin contributing to the Group's performance in the second half of the year. The prototypes of the Group's high-computing control module for humanoid robots have been delivered and jointly debugged with the customers, indicating its readiness for commercialization. Leveraging nearly 30 years of experiences and advantages in supply chain and module development, the Group aims to build up a supply chain platform for key components in the humanoid robotics industry, thereby offering integrated solutions to its customers. Through its exploration of new growth curve for the layout of core components business in the robotics sector, the Group seeks to establish a synergistic landscape with its "terminal + AI" business.
Guided by a pragmatic and innovative philosophy of business operation, the management team will seize its transformation opportunities amid challenges, deepen its technological capabilities, and steadily enhance its overall competitiveness to create sustainable value for shareholders.
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
5
CHAIRMAN'S STATEMENT
Appreciation
The Board would like to thank our shareholders, customers, suppliers, bankers and professional advisers for their support of the Group and to extend our appreciation to all our staff for their dedication and contributions throughout the reporting period.
Wong Cho Tung
Chairman
Hong Kong, 27 August 2025
MANAGEMENT DISCUSSION AND ANALYSIS
FINANCIAL REVIEW
For 1H-2025, the revenue of the Group was HK$208.2 million (1H-2024: HK$183.7 million), in which the revenue from handsets and IOT terminals business and automotive intelligent product business (together, "Core Business") increased by 16.0% to HK$187.2 million (1H-2024: HK$161.4 million) as compared with that of 1H-2024. In 1H-2025, the revenue from property management ("Non-core Business") decreased by 5.6% to HK$21.0 million (1H-2024: HK$22.2 million) as compared with that in 1H-2024.
The gross profit for 1H-2025 for the Core Business of the Group was HK$26.8 million (1H-2024: HK$18.2 million). The gross profit margin for the Core Business was 14.3% (1H-2024: 11.3%) and the gross profit margin for the Non-core Business decreased to 88.1% (1H-2024: 90.3%). The overall gross profit margin of the Group for 1H-2025 increased to 21.8% (1H-2024: 20.8%).
The Group recorded a profit attributable to owners of the Company of HK$8.8 million (1H-2024: loss attributable to owners of the Company HK$82.3 million). The basic earnings per share for 1H-2025 was HK$0.4 cents (1H-2024: loss per share HK$3.8 cents). Such huge reduction in loss was mainly attributable to the following factors:
Firstly, the Group continued to optimise its team structure, stringently control all fees and expenses, focus on those major products and key customers, produce good products and serve customers well to ensure its profitability. At the same time, the negative impact of issues left over from the past, including clearance of aged inventory and the handling of personnel-related matters, on the performance during the current period was substantially reduced, thus enabling the Group to essentially turn around its operating results from losses to profits during the reporting period.
Secondly, the Group deregistered several subsidiaries in the PRC during 1H-2024. The significant depreciation in value of RMB to USD during 1H-2024 when compared to the exchange rate when the USD was injected to the said subsidiaries at incorporation has resulted in one-off foreign exchange loss of approximately HK$30.8M in 1H-2024.
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
MANAGEMENT DISCUSSION AND ANALYSIS
Segment results of Core Business
| Six months ended 30 June 2025 | Six months ended 30 June 2024 | |||||
|---|---|---|---|---|---|---|
| Revenue HK$'M | Gross profit HK$'M | Gross profit margin % | Revenue HK$'M | Gross profit HK$'M | Gross profit margin % | |
| Handsets and IOT terminals business | 174.3 | 24.7 | 14.2 | 156.3 | 16.8 | 10.8 |
| Automotive intelligent product business | 12.9 | 2.1 | 16.6 | 5.1 | 1.4 | 26.9 |
| Total | 187.2 | 26.8 | 14.3 | 161.4 | 18.2 | 11.3 |
Handsets and IOT terminals business
The strategy of "balancing income and expenditures, and managing costs" introduced in 2024 continued to deliver results. Through the optimization of team structure, rigorous control on costs and expenses, and the effective utilisation of external resources, operating costs were brought under control, leading to an increase in segment gross profit. The revenue of this segment for 1H-2025 increased by 11.5% to HK$174.3 million (1H-2024: HK$156.3 million) as compared to that of 1H-2024. The gross profit margin of this segment was 14.2% in 1H-2025 (1H-2024: 10.8%). The revenue of ODM business accounted for approximately 93% of the revenue of this segment in 1H-2025 (1H-2024: 91%).
Automotive intelligent product business
The revenue of this segment for 1H-2025 increased by 152.9% to HK$12.9 million (1H-2024: HK$5.1 million) as compared to that of 1H-2024. The gross profit margin of this segment was 16.6% in 1H-2025 (1H-2024: 26.9%). In 1H-2024, the revenue from this segment primarily came from non-recurring engineering fee and hardware revenue. The Group had not capitalized the related R&D expenses based on the principle of prudence, resulting in relatively high gross profit. In 1H-2025, the revenue of this segment only came from hardware revenue, and the gross profit has returned to normal level of hardware revenue.
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
MANAGEMENT DISCUSSION AND ANALYSIS
LIQUIDITY, FINANCIAL RESOURCES AND CAPITAL STRUCTURE
Liquidity
As at 30 June 2025, the Group had bank balances and cash of HK$152.9 million (31 December 2024: HK$360.3 million), of which 13.3% was held in US dollars, 15.4% was held in Japanese dollars, 70.2% was held in Renminbi and the remaining balance was held in Hong Kong dollars, and short-term bank deposits of HK$744.0 million (31 December 2024: HK$580.8 million) among which 60.0% was held in US dollars and 40.0% was held in Renminbi. The Group intends to finance its working capital and capital expenditure plans from such bank balances. The total bank borrowings of the Group amounted to HK$7.7 million as at 30 June 2025 (31 December 2024: HK$29.2 million). All of the borrowings were at floating interest rates and repayable within one year.
Operating efficiency
The respective turnover period of inventory, trade and notes receivables, trade and notes payables of the Group for the handsets and IOT terminals business is presented below:
| 30 June 2025 Days | 31 December 2024 Days | |
|---|---|---|
| Inventory turnover period | 47 | 75 |
| Trade and notes receivables turnover period | 88 | 82 |
| Trade and notes payables turnover period | 109 | 105 |
In 1H-2025, the Group adopted the "just-in-time" supply mode, shifting to a demand-oriented "pull" production and distribution model, minimizing the inventory level as much as possible. At the same time, sales management was enhanced, with more accurate forecasting and response to customer demand, reducing the surplus or shortage caused by forecast deviations. As a result, the inventory turnover period in 1H-2025 significantly decreased as compared to that of year 2024.
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
MANAGEMENT DISCUSSION AND ANALYSIS
In 1H-2025, due to intensified market competition, in order to maintain market share, the Group had to relax the credit policy for certain selected customers and appropriately extend the credit period. As a result, the trade and note receivables turnover period in 1H-2025 slightly increased as compared to that in 2024.
The trade and notes payables turnover period remained relatively stable in 1H-2025 and year 2024.
As at 30 June 2025, the current ratio, calculated as current assets over current liabilities, was 3.6 times (31 December 2024: 3.1 times).
The Group reckons that inventory turnover period, trade and notes receivables turnover period, and trade and notes payables turnover period help the Group understands its ability to convert inventory into cash and its sales cash conversion cycle. Through reviewing the turnover periods, the Group can improve its operational efficiency. The current ratio can help the Group understand its ability to pay short-term and long-term obligations.
Treasury policies
The Group adopts a prudent approach in its treasury policy. The Group's surplus funds are mainly held under fixed and savings deposits in reputable banks to earn interest income.
Certain sales and purchases of inventories of the Group are denominated in US dollars. Furthermore, certain trade receivables, trade payables and bank balances are denominated in US dollars, thereby exposing the Group to the currency risk of US dollars. During 1H-2025, the Group did not use any financial instrument for hedging purpose but it will consider entering into non-deliverable foreign exchange forward contracts to offset the foreign exchange risks dominated in US dollars when necessary.
Capital structure
As at 30 June 2025, the Company had 2,143,351,300 ordinary shares of HK$0.10 each in issue and did not hold any treasury share.
No shares of the Company were issued during 1H-2025.
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
MANAGEMENT DISCUSSION AND ANALYSIS
GEARING RATIO
As at 30 June 2025, the total assets of the Group were HK$1,883.8 million (31 December 2024: HK$1,921.2 million) and the bank borrowings were HK$7.7 million (31 December 2024: HK$29.2 million). The gearing ratio of the Group, calculated as total bank borrowings over total assets, was 0.4% (31 December 2024: 1.5%).
Through reviewing its gearing ratio on a regular basis and based on its future capital planning needs, the Group strikes a balance between shareholder return and capital security. It also adjusts its capital structure in response to changes in the operational environment.
EMPLOYEES
As at 30 June 2025, the Group had approximately 510 (31 December 2024: 573) employees. The Group operates a Mandatory Provident Fund retirement benefits scheme for all its employees in Hong Kong, and provides its PRC employees with welfare schemes as required by the applicable laws and regulations of the PRC. The Group has a comprehensive training system in place that establishes a network-based career path for employees, including position and ability management, skills enhancement programme, various training opportunities, online learning programme for staff, internal promotion system, key employees development programme, succession plans for key positions and leadership development programme. The Group also offers discretionary bonuses and may grant share options under the share option scheme and share awards under the share award scheme adopted or to be adopted by the Company from time to time to its employees by reference to individual performance and the performance of the Group.
EMOLUMENT POLICY
The emolument policy of the employees of the Group is set by the human resources department. The Group seeks to provide remuneration packages on the basis of the merit, qualifications and competence of the employees.
The emoluments of the Directors and senior management of the Company are reviewed by the remuneration committee of the Board, having regard to factors including the Group's operating results, responsibilities of the Directors and senior management and comparable market statistics.
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
MANAGEMENT DISCUSSION AND ANALYSIS
The Company has adopted a share option scheme ("Share Option Scheme") to motivate the eligible persons referred therein, which include executive Directors and employees of the Group, to optimise their future contributions to the Group and to reward them for their efforts.
FUTURE PLANS FOR MATERIAL INVESTMENT
During 1H-2025, the Group did not have any future plans for material investment or capital assets.
MATERIAL ACQUISITION AND DISPOSAL OF SUBSIDIARIES, ASSOCIATED COMPANIES OR JOINT VENTURES
During 1H-2025, the Group did not have any material acquisition or disposal of subsidiaries, associated companies or joint ventures.
SIGNIFICANT INVESTMENT
As at 30 June 2025, the Group did not have any significant investment.
CONTINGENT LIABILITIES
As at 30 June 2025, the Group did not have any material contingent liabilities.
EVENT AFTER THE REPORTING PERIOD
There have been no significant events of the Group occurred since the end of 1H-2025.
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS
FOR THE SIX MONTHS ENDED 30 JUNE 2025
| NOTES | Six months ended 30 June | ||
|---|---|---|---|
| 2025 | |||
| HK$’000 | |||
| (Unaudited) | 2024 | ||
| HK$’000 | |||
| (Unaudited) | |||
| Revenue | 3 | 208,208 | 183,678 |
| Cost of sales and services | (162,925) | (145,398) | |
| Gross profit | 45,283 | 38,280 | |
| Other income | 5 | 17,663 | 27,390 |
| Other gains and losses | 5 | (9,469) | (53,670) |
| Reversal of impairment losses | |||
| under expected credit loss model, net | 12 | 2,604 | 1,300 |
| Research and development expenses | (27,850) | (59,942) | |
| Selling and distribution costs | (7,456) | (9,372) | |
| Administrative expenses | (19,843) | (33,797) | |
| Share of results of associates | 3,115 | 56 | |
| Finance costs | (271) | (1,053) | |
| Profit (loss) before taxation | 3,776 | (90,808) | |
| Taxation | 6 | 1,933 | 770 |
| Profit (loss) for the period | 7 | 5,709 | (90,038) |
12 SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
| Six months ended 30 June | ||
|---|---|---|
| 2025 | 2024 | |
| HK$'000 | HK$'000 | |
| NOTE | (Unaudited) | (Unaudited) |
| Profit (loss) for the period attributable to: | ||
| Owners of the Company | 8,807 | (82,257) |
| Non-controlling interests | (3,098) | (7,781) |
| 5,709 | (90,038) | |
| Earnings (loss) per share (HK cents) | 9 | |
| Basic | 0.4 | (3.8) |
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE SIX MONTHS ENDED 30 JUNE 2025
| NOTE | Six months ended 30 June | ||
|---|---|---|---|
| 2025 | |||
| HK$'000 | |||
| (Unaudited) | 2024 | ||
| HK$'000 | |||
| (Unaudited) | |||
| Profit (loss) for the period | 7 | 5,709 | (90,038) |
| Other comprehensive income (expense) for the period: | |||
| Item that may be subsequently reclassified to profit or loss for the period: | |||
| Reclassification of cumulative translation reserve upon deregistration of foreign operations | - | 30,764 | |
| Items that will not be subsequently reclassified to profit or loss during the period: | |||
| Surplus on transfer of right-of-use assets and property, plant and equipment to investment properties at fair value | 20,206 | 476 | |
| Fair value loss on investment in equity instrument at fair value through other comprehensive income, net of deferred tax | (2,722) | (7,705) | |
| Deferred tax relating to items that will not be reclassified to profit or loss | (4,104) | 1,807 | |
| Exchange difference arising on translation to presentation currency | 15,802 | (4,561) | |
| Other comprehensive income for the period | 29,182 | 20,781 | |
| Total comprehensive income (expense) for the period | 34,891 | (69,257) | |
| Total comprehensive income (expense) attributable to: | |||
| Owners of the Company | 37,989 | (61,476) | |
| Non-controlling interests | (3,098) | (7,781) | |
| 34,891 | (69,257) |
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AT 30 JUNE 2025
| | NOTES | 30 June 2025
HK$’000
(Unaudited) | 31 December 2024
HK$’000
(Audited) |
| --- | --- | --- | --- |
| Non-current assets | | | |
| Investment properties | 10 | 591,019 | 574,540 |
| Property, plant and equipment | 10 | 27,804 | 31,428 |
| Right-of-use assets | 10 | 15,395 | 15,658 |
| Intangible assets | 10 | 457 | 294 |
| Interests in associates | | 75,832 | 49,798 |
| Equity instruments at fair value through
other comprehensive income (“FVTOCI”) | 18 | 70,226 | 71,726 |
| | | 780,733 | 743,444 |
| Current assets | | | |
| Inventories | 13 | 31,105 | 52,720 |
| Trade and notes receivables | 11 | 89,314 | 110,823 |
| Other receivables, deposits and prepayments | | 85,470 | 72,768 |
| Financial assets at fair value through
profit or loss (“FVTPL”) | 18 | 228 | 291 |
| Short-term bank deposits | | 744,033 | 580,821 |
| Bank balances and cash | | 152,879 | 360,313 |
| | | 1,103,029 | 1,177,736 |
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
| | NOTES | 30 June 2025
HK$'000
(Unaudited) | 31 December 2024
HK$'000
(Audited) |
| --- | --- | --- | --- |
| Current liabilities | | | |
| Trade payables | 14 | 58,477 | 86,792 |
| Contract liabilities | | 79,529 | 97,731 |
| Deposits from tenants | | 2,608 | 2,699 |
| Deferred income | | 1,116 | 1,097 |
| Other payables and accruals | | 65,797 | 64,931 |
| Bank borrowings | 15 | 7,674 | 29,162 |
| Lease liabilities | | 1,149 | 2,344 |
| Tax payables | | 91,162 | 97,478 |
| | | 307,512 | 382,234 |
| Net current assets | | 795,517 | 795,502 |
| Total assets less current liabilities | | 1,576,250 | 1,538,946 |
| Capital and reserves | | | |
| Share capital | 16 | 214,335 | 214,335 |
| Reserves | | 1,263,640 | 1,225,651 |
| Equity attributable to owners of the Company | | 1,477,975 | 1,439,986 |
| Non-controlling interests | | (13,168) | (10,070) |
| Total equity | | 1,464,807 | 1,429,916 |
| Non-current liabilities | | | |
| Deposits from tenants | | 6,239 | 6,278 |
| Lease liabilities | | 634 | 80 |
| Deferred tax liabilities | | 77,731 | 75,748 |
| Deferred income | | 26,839 | 26,924 |
| | | 111,443 | 109,030 |
| | | 1,576,250 | 1,538,946 |
16
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTHS ENDED 30 JUNE 2025
| Attributable to owners of the Company | Non-controlling interests | Total | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Share capitalHK$'000 | Share premiumHK$'000 | Statutory surplus reserveHK$'000 | Other reserveHK$'000 | Share option reserveHK$'000 | Properties revaluation reserveHK$'000 | Asset revaluation reserveHK$'000 | Capital redemption reserveHK$'000 | Translation reserveHK$'000 | Accumulated (loss) profitsHK$'000 | TotalHK$'000 | ||||
| At 1 January 2024 (audited) | 214,335 | 733,716 | 119,217 | 95,271 | 8,602 | 274,905 | 11,830 | 44,222 | 61,722 | 56,106 | 1,619,926 | (733) | 1,619,193 | |
| Loss for the period | - | - | - | - | - | - | - | - | - | (82,257) | (82,257) | (7,781) | (90,038) | |
| Other comprehensive income (expense) for the period | - | - | - | - | - | 357 | (5,779) | - | 26,203 | - | 20,781 | - | 20,781 | |
| Total comprehensive income (expense) for the period | - | - | - | - | - | 357 | (5,779) | - | 26,203 | (82,257) | (61,476) | (7,781) | (69,257) | |
| Disposal of a subsidiary | - | - | - | - | - | - | - | - | (315) | 9,153 | 8,838 | (8,838) | - | |
| Dividend paid (Note 6) | - | - | - | - | - | - | - | - | - | (85,734) | (85,734) | - | (85,734) | |
| Withdrawn upon deregistration of subsidiaries | - | - | (1,817) | - | - | - | - | - | - | 1,817 | - | - | - | |
| Transfer to statutory surplus reserve | - | - | 745 | - | - | - | - | - | - | (745) | - | - | - | |
| At 30 June 2024 (unaudited) | 214,335 | 733,716 | 118,145 | 95,271 | 8,602 | 275,262 | 6,051 | 44,222 | 87,610 | (101,660) | 1,481,554 | (17,352) | 1,464,202 | |
| At 1 January 2025 (audited) | 214,335 | 733,716 | 118,498 | 95,271 | - | 275,262 | 15,455 | 44,222 | 57,763 | (114,536) | 1,439,986 | (10,070) | 1,429,916 | |
| Profit (loss) for the period | - | - | - | - | - | - | - | - | - | 8,807 | 8,807 | (3,098) | 5,709 | |
| Other comprehensive income (expense) for the period | - | - | - | - | - | 15,421 | (2,041) | - | 15,802 | - | 29,182 | - | 29,182 | |
| Total comprehensive income (expense) for the period | - | - | - | - | - | 15,421 | (2,041) | - | 15,802 | 8,807 | 37,989 | (3,098) | 34,891 | |
| Withdrawn upon deregistration of a subsidiary | - | - | (546) | - | - | - | - | - | - | 546 | - | - | - | |
| Withdrawn upon capital reduction of a subsidiary | - | - | (3,618) | - | - | - | - | - | - | 3,618 | - | - | - | |
| Transfer to statutory surplus reserve | - | - | 2,324 | - | - | - | - | - | - | (2,324) | - | - | - | |
| At 30 June 2025 (unaudited) | 214,335 | 733,716 | 116,658 | 95,271 | - | 290,683 | 13,414 | 44,222 | 73,565 | (103,889) | 1,477,975 | (13,168) | 1,464,807 |
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
Notes:
(a) As stipulated by the relevant laws and regulations of the People's Republic of China ("PRC"), before distribution of the net profit each year, the subsidiaries established in the PRC shall set aside 10% of their net profit after taxation for the statutory surplus reserve fund (except where the reserve has reached 50% of the subsidiaries' registered capital). The reserve fund can only be used, upon approval by the board of directors of the relevant subsidiaries and by the relevant authority, to offset accumulated losses or increase capital.
(b) Other reserve was arisen from the reorganisation in preparation for the listing of the Company's shares on the Main Board of The Stock Exchange of Hong Kong Limited (the "Stock Exchange") and the difference between the considerations paid and the relevant non-controlling interests upon the acquisition of additional interests in subsidiaries.
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE SIX MONTHS ENDED 30 JUNE 2025
| Six months ended 30 June | ||
|---|---|---|
| 2025 | ||
| HK$’000 | ||
| (Unaudited) | 2024 | |
| HK$’000 | ||
| (Unaudited) | ||
| OPERATING ACTIVITIES | ||
| Operating cash flows before movements in working capital | (582) | (37,690) |
| (Decrease) increase in contract liabilities | (19,648) | 14,327 |
| Other movements in working capitals | 26,939 | (21,948) |
| Cash from (used in) operations | 6,709 | (45,311) |
| Interest received | 955 | 15,389 |
| Tax paid | (6,464) | (19,249) |
| NET CASH FROM (USED IN) OPERATING ACTIVITIES | 1,200 | (49,171) |
| INVESTING ACTIVITIES | ||
| Proceeds on disposal of property, plant and equipment | 3 | 1,159 |
| Net proceeds on disposal of assets held for disposal | – | 287,281 |
| Purchase of property, plant and equipment | (2,876) | (3,773) |
| Purchase of intangible assets | (875) | (630) |
| Investment in an associate | (22,000) | – |
| Receipt of consideration receivables | 564 | 644 |
| Advance to an associate | – | (251) |
| Placement of short-term bank deposits | (698,880) | (350,428) |
| Withdrawal of short-term bank deposits | 537,395 | 411,804 |
| NET CASH (USED IN) FROM INVESTING ACTIVITIES | (186,669) | 345,806 |
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
| Six months ended 30 June | ||
|---|---|---|
| 2025 | ||
| HK$'000 | ||
| (Unaudited) | 2024 | |
| HK$'000 | ||
| (Unaudited) | ||
| FINANCING ACTIVITIES | ||
| Repayments of bank borrowings | (21,700) | (33,000) |
| Interest paid | (271) | (1,053) |
| Repayment of lease liabilities | (1,853) | (1,756) |
| Dividend paid | – | (85,734) |
| NET CASH USED IN FINANCING ACTIVITIES | (23,824) | (121,543) |
| NET (DECREASE) INCREASE IN CASH AND | ||
| CASH EQUIVALENTS | (209,293) | 175,092 |
| CASH AND CASH EQUIVALENTS AT BEGINNING | ||
| OF THE PERIOD | 360,313 | 74,219 |
| EFFECT OF FOREIGN EXCHANGE RATE CHANGES | 1,859 | (4,358) |
| CASH AND CASH EQUIVALENTS AT THE END | ||
| OF THE PERIOD | 152,879 | 244,953 |
20
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2025
1. GENERAL INFORMATION AND BASIS OF PREPARATION
SIM Technology Group Limited (“The Company”) was incorporated in Bermuda as an exempted company under the Companies Act 1981 of Bermuda (as amended) with limited liability.
The Company is an investment holding company. The principal activities of its subsidiaries are carrying out handsets and Internet of things terminals business (“handsets and IOT terminals business”), automotive intelligent products business and property management in the PRC.
The functional currency of the Company is Renminbi (“RMB”). The condensed consolidated financial statements are presented in Hong Kong dollars (“HK$”), as the Directors of the Company consider that it is a more appropriate presentation for a company listed on the Stock Exchange and for the convenience of the shareholders.
The condensed consolidated financial statements of the Group have been prepared in accordance with International Accounting Standard (“IAS”) 34 “Interim Financial Reporting” as well as the applicable disclosure requirements of Appendix D2 to the Rules Governing the Listing of Securities on the Stock Exchange.
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
2. PRINCIPAL ACCOUNTING POLICIES
The condensed consolidated financial statements have been prepared on the historical cost basis, except for investment properties and certain financial instruments that are measured at fair values.
Other than change in accounting policies resulting from application of amendments to International Financial Reporting Standards ("IFRSs"), the accounting policies and methods of computation used in the condensed consolidated financial statements for the six months ended 30 June 2025 are the same as those presented in the Group's annual consolidated financial statements for the year ended 31 December 2024.
Application of amendments to IFRS Standards
In the current interim period, the Group has applied the following amendments to a IFRS Accounting Standard issued by the International Accounting Standards Board ("IASB"), for the first time, which are mandatorily effective for the Group's annual period beginning on 1 January 2025 for the preparation of the Group's condensed consolidated financial statements:
| Amendments to IAS 21 | Lack of Exchangeability |
|---|---|
The application of the amendments to a IFRS Accounting Standard in the current interim period has had no material impact on the Group's financial positions and performance for the current and prior periods and/or on the disclosures set out in these condensed consolidated financial statements.
INTERIM FINANCIAL STATEMENTS
3. REVENUE
Disaggregation of revenue from contracts with customers
For the six months ended 30 June 2025 (unaudited)
| Handsets and IOT terminals business HK$’000 | Automotive intelligent products business HK$’000 | Property management HK$’000 | Total HK$’000 | |
|---|---|---|---|---|
| Types of goods or services | ||||
| Sale of handsets and IOT terminals | 174,308 | – | – | 174,308 |
| Sale of automotive intelligent products | – | 12,907 | – | 12,907 |
| 174,308 | 12,907 | – | 187,215 | |
| Property rental | – | – | 20,993 | 20,993 |
| Total | 174,308 | 12,907 | 20,993 | 208,208 |
| Revenue from contracts with customers and timing of revenue recognition | ||||
| A point in time | 174,308 | 12,907 | N/A | |
| Over time | – | – | N/A | |
| Total | 174,308 | 12,907 | N/A |
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
For the six months ended 30 June 2024 (unaudited)
| Handsets and IOT terminals business HK$’000 | Automotive intelligent products business HK$’000 | Property management HK$’000 | Total HK$’000 | |
|---|---|---|---|---|
| Types of goods or services | ||||
| Sale of handsets and IOT terminals | 156,346 | – | – | 156,346 |
| Sale of automotive intelligent products | – | 5,103 | – | 5,103 |
| 156,346 | 5,103 | – | 161,449 | |
| Property rental | – | – | 22,229 | 22,229 |
| Total | 156,346 | 5,103 | 22,229 | 183,678 |
| Revenue from contracts with customers and timing of revenue recognition | ||||
| A point in time | 155,714 | 5,103 | N/A | |
| Over time | 632 | – | N/A | |
| Total | 156,346 | 5,103 | N/A |
Geographical markets
The Group's revenue are substantially generated from the PRC, the country of domicile from which the group entities derive revenue. No further analysis is presented.
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
4. SEGMENT INFORMATION
Segment information is presented based on internal reports about components of the Group that are regularly reviewed by the chief operating decision maker, being the executive directors of the Company, for the purpose of allocating resources to segments and assessing their performance.
The following is an analysis of the Group's revenue and results by reportable and operating segments:
For the six months ended 30 June 2025 (unaudited)
| Handsets and IOT terminals business HK$'000 | Automotive intelligent products business HK$'000 | Property management HK$'000 | Consolidated HK$'000 | |
|---|---|---|---|---|
| Revenue | ||||
| External sales | 174,308 | 12,907 | 20,993 | 208,208 |
| Segment profit (loss) | 583 | (14,821) | (2,031) | (16,269) |
| Other income and other gains and losses – unallocated | 20,044 | |||
| Share of results of associates | 3,115 | |||
| Corporate expenses | (2,843) | |||
| Finance costs | (271) | |||
| Profit before taxation | 3,776 |
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
For the six months ended 30 June 2024 (unaudited)
| Handsets and IOT terminals business HK$’000 | Automotive intelligent products business HK$’000 | Property management HK$’000 | Consolidated HK$’000 | |
|---|---|---|---|---|
| Revenue | ||||
| External sales | 156,346 | 5,103 | 22,229 | 183,678 |
| Segment loss | (37,436) | (25,254) | (6,824) | (69,514) |
| Other income and other gains and losses – unallocated | (15,599) | |||
| Share of results of associates | 56 | |||
| Corporate expenses | (4,698) | |||
| Finance costs | (1,053) | |||
| Loss before taxation | (90,808) |
Segment result represents the financial result by each segment without allocation of interest income, dividend income, unallocated foreign exchange gain (loss), net gain or loss on financial assets at FVTPL, share of results of associates, certain other income, corporate expenses, finance costs and taxation.
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
The following is an analysis of the Group's assets and liabilities by reportable and operating segments:
| 30 June | 31 December | |
|---|---|---|
| 2025 | 2024 | |
| HK$'000 | HK$'000 | |
| (Unaudited) | (Audited) | |
| Segment assets | ||
| Handsets and IOT terminals business | 212,158 | 219,210 |
| Automotive intelligent products business | 2,832 | 33,878 |
| Property management | 591,019 | 574,540 |
| Total reportable segment assets | 806,009 | 827,628 |
| Unallocated assets | 1,077,753 | 1,093,552 |
| Total assets | 1,883,762 | 1,921,180 |
| Segment liabilities | ||
| Handsets and IOT terminals business | 180,614 | 201,686 |
| Automotive intelligent products business | 4,765 | 30,274 |
| Property management | 9,685 | 10,133 |
| Total reportable segment liabilities | 195,064 | 242,093 |
| Unallocated liabilities | 223,891 | 249,171 |
| Total liabilities | 418,955 | 491,264 |
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
For the purposes of monitoring segment performances and allocating resources between segments, all assets are allocated to reportable and operating segments other than certain property, plant and equipment, certain right-of-use assets, interests in associates, short-term bank deposits, bank balances and cash, financial assets at FVTPL, equity instruments at FVTOCI and certain other receivables, deposits and prepayments. Assets used jointly by operating segments are allocated on the basis of the revenues earned by individual operating segments.
For the purposes of monitoring segment performances and allocating resources between segments, all liabilities are allocated to reportable and operating segments other than certain lease liabilities, certain other payables, accruals, tax payables, bank borrowings and deferred tax liabilities.
5. OTHER INCOME/OTHER GAINS AND LOSSES
| Six months ended 30 June | ||
|---|---|---|
| 2025 | ||
| HK$'000 | ||
| (Unaudited) | 2024 | |
| HK$'000 | ||
| (Unaudited) | ||
| Other income | ||
| Refund of Value Added Tax ("VAT") (Note i) | 54 | 1,010 |
| Government grants (Note ii) | 1,755 | 9,806 |
| Bank interest income | 15,080 | 15,389 |
| Others | 774 | 1,185 |
| 17,663 | 27,390 |
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
| Six months ended 30 June | ||
|---|---|---|
| 2025 | 2024 | |
| HK$'000 | HK$'000 | |
| (Unaudited) | (Unaudited) | |
| Other gains and losses | ||
| Loss on disposal of property, plant and equipment | (92) | (4,173) |
| Written-off other payables | 2,155 | - |
| Net foreign exchange gain | 3,270 | 4,367 |
| Changes in fair values of investment properties | (14,739) | (21,120) |
| Expenses on land resumption | - | (1,567) |
| Loss on deregistration of subsidiaries (Note iii) | - | (30,764) |
| Donation | - | (236) |
| Net loss arising on financial assets measured at FVTPL | (63) | (177) |
| (9,469) | (53,670) |
Notes:
(i) Shanghai Simcom Limited ("Shanghai Simcom"), a subsidiary of the Company, is engaged in the business of distribution of self-developed and produced software and the development of automated test equipment and software. Under the current PRC tax regulation, it is entitled to a refund of VAT paid for sales of self-developed and produced software and the development of automated test software in the PRC.
(ii) During the current interim period, the amount includes HK$1,116,000 (six months ended 30 June 2024: HK$1,059,000) unconditional government grants received which was granted to encourage the Group's research and development activities in the PRC.
As at 30 June 2025, an amount of HK$27,955,000 (31 December 2024: HK$28,021,000) remained to be amortised and is included in other payables (for current portion) and deferred income (for non-current portion).
(iii) During the year ended 31 December 2024, Shanghai Wide-Top Financial Leasing Co., Ltd. and Guangdong Sim Technology Co., Limited, both of whom were wholly-owned subsidiaries of the Company in the PRC, were deregistered. A reclassification of cumulative translation reserve upon deregistration of amount of HK$30,764,000 had been recognised to profit and loss.
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
6. TAXATION
| Six months ended 30 June | ||
|---|---|---|
| 2025 | 2024 | |
| HK$'000 | ||
| (Unaudited) | HK$'000 | |
| (Unaudited) | ||
| Taxation comprises: | ||
| PRC Enterprise Income Tax ("EIT") | (4,782) | 3,154 |
| Over (under) provision in prior years | 3,030 | (7,545) |
| (1,752) | (4,391) | |
| Deferred tax credit | 3,685 | 5,161 |
| Taxation for the period | 1,933 | 770 |
No provision for Hong Kong Profits Tax has been made for both periods as the Group has no assessable profits arising in Hong Kong.
PRC EIT is calculated at the rates prevailing in the relevant districts of the PRC taking relevant tax incentives into account. Shanghai Simcom is classified as New and High Technology Enterprise and are entitled to adopt a tax rate of 15%. The relevant annual tax rate used for EIT for the Group's subsidiaries ranged from 15% to 25% (six months ended 30 June 2024: 15% to 25%).
Deferred tax charge represented taxable temporary differences associated with revaluation of equity instrument at FVTOCI and revaluation of investment properties and the deductible temporary differences that were previously recognised associated with write-down of inventories, trade receivables and impairment of property, plant and equipment. The directors considered the deductible temporary differences that were previously recognised to the extent that the amounts are no longer probable to be recovered and were reversed for both periods.
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
7. PROFIT (LOSS) FOR THE PERIOD
| Six months ended 30 June | ||
|---|---|---|
| 2025 | ||
| HK$'000 | ||
| (Unaudited) | 2024 | |
| HK$'000 | ||
| (Unaudited) | ||
| Profit (loss) for the period has been arrived at after charging (crediting) the following items: | ||
| Amortisation of intangible assets (included in cost of sales and services) | 719 | 1,018 |
| Less: Amount capitalised in inventories | (719) | (1,018) |
| – | – | |
| Depreciation of property, plant and equipment | 6,755 | 10,350 |
| Less: Amount capitalised in inventories | (6,491) | (5,098) |
| 264 | 5,252 | |
| Depreciation of right-of-use assets | 755 | 1,208 |
| Staff costs including directors' emoluments | 46,096 | 56,622 |
| Less: Amount capitalised in inventories | (4,026) | (5,187) |
| 42,070 | 51,435 | |
| Costs of inventories recognised as an expense (included in cost of sales and services) | 162,925 | 145,398 |
8. DIVIDENDS
The directors do not recommend the payment of an interim dividend for the six months ended 30 June 2025 (six months ended 30 June 2024: Nil).
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
9. EARNINGS (LOSS) PER SHARE
The calculation of the basic earnings (loss) per share attributable to the owners of the Company is based on the following data:
| Six months ended 30 June | ||
|---|---|---|
| 2025 | 2024 | |
| HK$'000 | HK$'000 | |
| (Unaudited) | (Unaudited) | |
| Profit (loss) | ||
| Profit (loss) for the purposes of basic earnings (loss) per share | 8,807 | (82,257) |
| Six months ended 30 June | ||
| 2025 | 2024 | |
| '000 | '000 | |
| Number of shares | ||
| Weighted average number of ordinary shares for the purpose of basic earnings (loss) per share | 2,143,351 | 2,142,207 |
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
10. MOVEMENTS IN INVESTMENT PROPERTIES, PROPERTY, PLANT AND EQUIPMENT, RIGHT-OF-USE ASSETS AND INTANGIBLE ASSETS
Investment properties
The fair value of the Group's investment properties at 30 June 2025 and 31 December 2024 were arrived at on the basis of a valuation carried out on that date by HG Appraisal & Consulting Limited, independent qualified professional valuer not related to the Group.
The fair value was determined based on the income capitalisation approach, where the market rentals of all lettable units of the properties were assessed and discounted at the market yield expected by investors for this type of properties. The market rentals were assessed based on estimates of future cash flows, supported by the terms of existing lease and the market rentals of the similar properties in the neighbourhood. The capitalisation rates were determined by reference to the yields derived from analysing the sales transactions of similar commercial and industrial properties in Shanghai and Shenyang adjusted to take into account the market expectation from property investors to reflect factors specific to the Group's investment properties. There has been no change in the valuation technique used in prior years.
In estimating the fair value of the properties, the highest and best use of the properties is their current use. At the end of the reporting period, the chief financial officer of the Group worked closely with the independent qualified professional valuer to establish and determine the appropriate valuation techniques and inputs. Where there was a material change in the fair value of the assets, the causes of the fluctuations would be reported to the management of the Group.
During the interim period, the Group transferred certain buildings from property, plant and equipment and right-of-use assets with aggregate carrying amount of HK$748,000 (six months ended 30 June 2024: HK$338,000) to investment properties because its use was changed as evidenced by the end of owner-occupation. The difference between the carrying amounts and the fair values of the relevant properties at the date of transfer amounted to HK$20,206,000 (six months ended 30 June 2024: HK$476,000) and was recognised in other comprehensive income.
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
The fair value of investment properties as at 30 June 2025 was HK$591,019,000 (31 December 2024: HK$574,540,000) and a fair value loss of HK$14,739,000 (six months ended 30 June 2024: fair value loss of HK$21,120,000) have been recognised directly in profit or loss for the six months ended 30 June 2025.
Property, plant and equipment
During the interim period, additions to the Group's property, plant and equipment amounted to HK$2,876,000 (six months ended 30 June 2024: HK$3,773,000).
During the interim period, the Group disposed of certain property, plant and equipment with an aggregate carrying amount of HK$95,000 (six months ended 30 June 2024: HK$5,332,000) for cash proceeds of HK$3,000 (six months ended 30 June 2024: HK$1,159,000), resulting in a loss on disposal of HK$92,000 (six months ended 30 June 2024: HK$4,173,000).
Right-of-use assets
During the interim period, the Group entered into several new lease agreements for the use of office premises and warehouses with lease term ranged from two to three years. The Group is required to make fixed monthly payments during the contract period. On lease commencement, the Group recognised right-of-use assets and lease liability amounted to HK$1,364,000 (six months ended 30 June 2024: HK$376,000).
Intangible assets
During the interim period, additions to the Group's intangible assets amounted to HK$875,000 (six months ended 30 June 2024: HK$630,000).
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
11. TRADE AND NOTES RECEIVABLES
The normal credit period given on sale of goods and services relating to handsets and IOT terminals business and automotive intelligent products business is 0 – 90 days. A longer period is granted to a few customers with whom the Group has a good business relationship and which are in sound financial condition.
The following is an aged analysis of trade receivables, net of allowance for credit losses, as well as notes receivables presented based on the invoice dates at the end of the reporting period, which approximated the revenue recognition dates:
| | As at
30 June
2025
HK$’000
(Unaudited) | As at
31 December
2024
HK$’000
(Audited) |
| --- | --- | --- |
| Trade receivables | | |
| 0 – 30 days | 44,853 | 49,038 |
| 31 – 60 days | 15,610 | 11,262 |
| 61 – 90 days | 2,492 | 12,632 |
| 91 – 180 days | – | 11,807 |
| Over 180 days | 26,114 | 27,028 |
| | 89,069 | 111,767 |
| Less: Allowance for credit losses | (27,290) | (28,429) |
| | 61,779 | 83,338 |
| Notes receivables (Note) | | |
| 0 – 30 days | 11,284 | 7,547 |
| 31 – 60 days | 11,201 | 14,056 |
| 61 – 90 days | 3,112 | 4,723 |
| 91 – 180 days | 1,938 | 1,159 |
| | 27,535 | 27,485 |
| Trade and notes receivables | 89,314 | 110,823 |
Note: Notes receivables represent the promissory notes issued by banks received from the customers.
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
12. REVERSAL OF IMPAIRMENT LOSSES UNDER EXPECTED CREDIT LOSS MODEL, NET
| Six months ended 30 June | ||
|---|---|---|
| 2025 | 2024 | |
| HK$'000 | HK$'000 | |
| (Unaudited) | (Unaudited) | |
| (Reversal of impairment losses) impairment losses recognised in respect of | ||
| Trade receivables | (1,617) | (721) |
| Other receivables | (423) | 65 |
| Consideration receivables | (564) | (644) |
| (2,604) | (1,300) |
The basis of determining the inputs and assumptions and the estimation techniques used in the condensed consolidated financial statements for the six months ended 30 June 2025 are the same as those followed in the preparation of the Group's annual consolidated financial statements for the year ended 31 December 2024.
13. INVENTORIES
| 30 June | 31 December | |
|---|---|---|
| 2025 | 2024 | |
| HK$'000 | HK$'000 | |
| (Unaudited) | (Audited) | |
| Raw materials | 19,016 | 34,603 |
| Work in progress | 136 | 138 |
| Finished goods | 11,953 | 17,979 |
| 31,105 | 52,720 |
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
14. TRADE PAYABLES
Trade payables principally comprise amounts outstanding for trade purchases. The normal credit period taken for trade purchases is 30 – 90 days.
The aged analysis of the Group’s trade payables at the end of the reporting period presented based on the invoice dates for trade payables is as follows:
| | As at
30 June
2025
HK$’000
(Unaudited) | As at
31 December
2024
HK$’000
(Audited) |
| --- | --- | --- |
| Trade payables | | |
| 0 – 30 days | 43,139 | 53,712 |
| 31 – 60 days | 1,868 | 7,093 |
| 61 – 90 days | – | 15,198 |
| Over 90 days | 13,470 | 10,789 |
| Trade payables | 58,477 | 86,792 |
15. BANK BORROWINGS
The short-term bank borrowings are unsecured, interest bearing, at the China Loan Prime Rate (“LPR”) plus 135 basis points per annum (31 December 2024: LPR plus 135 basis points per annum) and repayable within one year.
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
16. SHARE CAPITAL
| Number of shares | Share capital | |||
|---|---|---|---|---|
| 2025 | 2024 | 2025 | 2024 | |
| '000 | '000 | HK$'000 | HK$'000 | |
| Ordinary shares of HK$0.1 each | ||||
| Authorised: | ||||
| At 1 January and 30 June | 3,000,000 | 3,000,000 | 300,000 | 300,000 |
| Issued: | ||||
| At 1 January and 30 June | 2,143,351 | 2,143,351 | 214,335 | 214,335 |
17. RELATED PARTY TRANSACTIONS
The amounts due from associates are unsecured, interest free with 30-60 days credit terms.
| Six months ended 30 June | ||
|---|---|---|
| 2025 | 2024 | |
| HK$'000 (Unaudited) | HK$'000 (Unaudited) | |
| Handset and IOT terminals business income from associates | - | 2,320 |
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
The remuneration of key management during the period was as follows:
| Six months ended 30 June | ||
|---|---|---|
| 2025 | ||
| HK$'000 | ||
| (Unaudited) | 2024 | |
| HK$'000 | ||
| (Unaudited) | ||
| Short term benefits | 2,379 | 2,630 |
| Post-employment benefits | 163 | 160 |
| Other benefits | 405 | 249 |
| 2,947 | 3,039 |
18. FAIR VALUE MEASUREMENT OF FINANCIAL INSTRUMENTS
Fair value of the Group's financial assets that are measured at fair value on a recurring basis.
Some of the Group's financial assets are measured at fair value at the end of each reporting period. The following table gives information about how the fair values of these financial assets and financial liabilities are determined (in particular the valuation technique(s) and inputs used), as well as the level of the fair value hierarchy into which the fair value measurements are categorised (levels 1 to 3) based on the degree to which the inputs to the fair value measurements is observable.
- Level 1 fair value measurements are based on quoted prices (unadjusted) in active market for identical assets or liabilities;
- Level 2 fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and
- Level 3 fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs).
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
| Fair value as at | ||||||
|---|---|---|---|---|---|---|
| 30 June 2025 HK$'000 | 31 December 2024 HK$'000 | Fair value hierarchy | Valuation technique(s) and key input(s) | Significant unobservable inputs | Relationship of unobservable inputs to fair value | |
| Financial assets | ||||||
| 1. Equity instruments at FVTOCI - unlisted equity security (9.39%; equity interest in a private entity Established in PRC) | 8,256 | 7,234 | Level 3 | Adjusted net assets approach - the book value of assets and liabilities of the investee are adjusted to their fair value. | Adjusted net asset value of the investee | An increase in the adjusted net assets, holding all other variables constant would increase the carrying amount. |
| - unlisted equity security (14.97%; equity interest in a private entity established in PRC) | 30,033 | 29,564 | Level 3 | Adjusted net assets approach - the book value of assets and liabilities of the investee are adjusted to their fair value. | Adjusted net asset value of the investee | An increase in the adjusted net assets, holding all other variables constant would increase the carrying amount. |
| - unlisted equity security (2.20%; equity interest in a private entity established in PRC) | 31,937 | 34,928 | Level 3 | Adjusted net assets approach - the book value of assets and liabilities of the investee are adjusted to their fair value. | Adjusted net asset value of the investee | An increase in the adjusted net assets, holding all other variables constant would increase the carrying amount. |
| 70,226 | 71,726 | |||||
| 2. Financial assets at FVTPL - listed equity security | 228 | 291 | Level 1 | Quoted bid prices in an active market. | N/A | N/A |
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
INTERIM FINANCIAL STATEMENTS
Reconciliation of Level 3 fair value measurements
| Equity instruments at FVTOCI HK$'000 | |
|---|---|
| As at 1 January 2024 (audited) | 68,130 |
| Total unrealised loss in other comprehensive income | (7,705) |
| As at 30 June 2024 (unaudited) | 60,425 |
| As at 1 January 2025 (audited) | 71,726 |
| Total unrealised loss in other comprehensive income | (2,722) |
| Exchange adjustment | 1,222 |
| As at 30 June 2025 (unaudited) | 70,226 |
Included in other comprehensive income is an amount of HK$2,722,000 fair value loss (six months ended 30 June 2024: HK$7,705,000) relating to unlisted equity securities classified as equity instruments at FVTOCI held at the end of the current reporting period and is reported as changes of "assets revaluation reserve".
The management of the Group considers that the carrying amounts of financial assets and financial liabilities recorded at amortised cost in the condensed consolidated statement of financial position approximate their fair values.
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
OTHER INFORMATION
DIRECTORS' AND CHIEF EXECUTIVE'S INTERESTS AND SHORT POSITION IN SHARES
As at 30 June 2025, the interests and short positions of the Directors and chief executive of the Company in the shares, underlying shares and debentures of the Company or any of its associated corporation (within the meaning of Part XV of the Securities and Futures Ordinance (Cap 571, Laws of Hong Kong) ("SFO")), as recorded in the register required to be kept by the Company pursuant to section 352 of the SFO, or as otherwise notified to the Company and The Stock Exchange of Hong Kong Limited ("Stock Exchange") pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers ("Model Code") as set out in Appendix C3 to the Rules Governing the Listing of Securities on the Stock Exchange ("Listing Rules"), were as follows:
Long position in the shares of the Company
| Name of directors | Nature of interest | Total number of ordinary shares of the Company | Approximate percentage of interest in the Company (note 4) |
|---|---|---|---|
| Mr. Wong Cho Tung | Interest of controlled corporations (note 1) | 1,209,084,000 | 56.41% |
| Beneficial owner | 20,814,000 | 0.98% | |
| Interests held jointly with another person (note 3) | 3,098,000 | 0.14% | |
| 1,232,996,000 | 57.53% | ||
| Ms. Yeung Man Ying | Interest of a controlled corporation (note 2) | 734,857,000 | 34.29% |
| Beneficial owner | 21,136,000 | 0.99% | |
| Interests held jointly with another person (note 3) | 3,098,000 | 0.14% | |
| 759,091,000 | 35.42% | ||
| Mr. Zhu Qi | Beneficial owner | 225,000 | 0.01% |
42 SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
43
OTHER INFORMATION
Notes:
-
Mr. Wong Cho Tung ("Mr. Wong") controls more than one-third of the voting power of Info Dynasty Group Limited ("Info Dynasty"). Mr. Wong is therefore deemed to be interested in all the 734,857,000 shares held by Info Dynasty in the Company by virtue of Part XV of the SFO. Mr. Wong is the sole director of Intellipower Investments Limited ("Intellipower") and Simcom Limited ("Simcom (BVI)") is wholly-owned by Mr. Wong. Therefore, Mr. Wong is deemed to be interested in all the 454,227,000 shares and 20,000,000 shares held by Intellipower and Simcom (BVI) respectively in the Company by virtue of Part XV of the SFO.
-
Ms. Yeung Man Ying ("Mrs. Wong"), the spouse of Mr. Wong, controls more than one-third of the voting power of Info Dynasty. Mrs. Wong is therefore deemed to be interested in all the 734,857,000 shares held by Info Dynasty in the Company by virtue of Part XV of the SFO.
-
The shares are held jointly by Mr. Wong and Mrs. Wong.
-
Calculation of percentage of interest in the Company is based on the issued share capital of 2,143,351,300 shares of the Company as at 30 June 2025.
As at 30 June 2025, save as disclosed above, none of the Directors, chief executive of the Company or their respective associates had any interests or short positions, whether beneficial or non-beneficial, in the shares, underlying shares and debentures of the Company or any of its associated corporations as recorded in the register required to be kept under section 352 of the SFO, or as otherwise notified to the Company and the Stock Exchange pursuant to the Model Code.
OTHER INFORMATION
SUBSTANTIAL SHAREHOLDERS' AND OTHERS' INTERESTS IN THE SECURITIES OF THE COMPANY
As at 30 June 2025, the interests of the substantial Shareholders and other persons (other than Directors or chief executive of the Company) in the shares and underlying shares of the Company as recorded in the register required to be kept by the Company pursuant to section 336 of the SFO were as follows:
Long position in the shares of the Company
| Name of shareholder | Nature of interest | Total number of ordinary shares of the Company | Approximate percentage of interest in the Company (note 1) |
|---|---|---|---|
| Info Dynasty (note 2) | Beneficial owner | 734,857,000 | 34.29% |
| Intellipower (note 3) | Beneficial owner | 454,227,000 | 21.19% |
Notes:
- Calculation of percentage of interest in the Company is based on the issued share capital of 2,143,351,300 shares of the Company as at 30 June 2025.
- The relationship between Info Dynasty and Mr. Wong and the relationship between Info Dynasty and Mrs. Wong are disclosed under the paragraph headed "Directors and Chief Executive's Interests and Short Position in Shares" above.
- The relationship between Intellipower and Mr. Wong is disclosed under the paragraph headed "Directors and Chief Executive's Interests and Short Position in Shares" above.
Save as disclosed above, as at 30 June 2025, there is no other substantial Shareholders or persons (other than a Director or chief executive of the Company) had any interests or short positions in the shares and underlying shares of the Company as recorded in the register required to be kept by the Company under the section 336 of the SFO.
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
45
OTHER INFORMATION
SHARE OPTION SCHEME
The Company had adopted a share option scheme ("Share Option Scheme") on 1 June 2016, which shall remain in force until 1 June 2026, being 10 years after the date of its adoption.
No options have been granted by the Company under the Share Option Scheme since its adoption on 1 June 2016. As at 1 January 2025, 30 June 2025 and as at the date of this report, the number of options available for grant under the Share Option Scheme was 255,789,630 shares, which represent 11.93% of the issued shares of the Company as at the date of this report. No service provider sublimit has been authorised under the Share Option Scheme.
In view of the new requirements under Chapter 17 of the Listing Rules which became effective on 1 January 2023 ("New Share Scheme Rules"), share options shall only be granted under the Share Option Scheme in accordance with and as permitted by the New Share Scheme Rules.
No share option was granted, exercised, cancelled or lapsed under the Share Option Scheme during 1H-2025.
Save as disclosed above, at no time during 1H-2025 and at the end of 1H-2025 was the Company or any of its subsidiaries a party to any arrangements that would enable the Directors or the chief executive of the Company to acquire benefits by means of acquisition of shares in, or debt securities (including debentures) of, the Company or any other body corporate and save as disclosed in this report, none of the Directors, the chief executive of the Company, their respective spouses or children under the age of 18, had any right to subscribe for securities of the Company, or had exercised any such right during 1H-2025 and at the end of 1H-2025.
Save as disclosed above, the Group does not have any other share option scheme or share award scheme during 1H-2025.
PURCHASE, SALE OR REDEMPTION OF LISTED SECURITIES OF THE COMPANY
During 1H-2025, neither the Company nor any of its subsidiaries has purchased, sold or redeemed any of the Company's listed securities (including sale of treasury shares).
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
OTHER INFORMATION
CORPORATE GOVERNANCE CODE
According to code provision C.2.1 of the Corporate Governance Code ("Corporate Governance Code") as set out in Part 2 of Appendix C1 to the Listing Rules, the roles of the chairman and the chief executive officer should be separate and should not be performed by the same individual. On 30 September 2022, Mr. Gao Jun resigned as an executive Director and the chief executive officer of the Group ("CEO"). Ever since the resignation of Mr. Gao Jun, the Company has not been able to identify a suitable candidate for the position of the CEO and the office of the CEO therefore remains vacant. This constitutes a deviation from code provision C.2.1.
However, a management team which takes up the roles and duties of the CEO has been set up by the Group since Mr. Gao Jun's resignation. The team comprises five members, including three executive Directors, namely Mr. Wong Cho Tung, Mr. Zhu Wenhui and Mr. Zhu Qi, and two members of the management of the Company, namely Mr. Yang Hanjie (the chief marketing officer of the Group's operational headquarters in the PRC) and Mr. Yang Feng (the General Manager of the ODM Division of the Group's operational headquarters in the PRC). In light of the above, even though the Company has not been able to appoint an individual to take up the role of the CEO since Mr. Gao Jun's resignation, the Board considers that such a deviation from code provision C.2.1 of the Corporate Governance Code is appropriate under such circumstances.
Save as disclosed above, the Company has complied with the code provisions laid down in the Corporate Governance Code as set out in Part 2 of Appendix C1 to the Listing Rules for 1H-2025.
COMPLIANCE WITH THE MODEL CODE
The Company has adopted the Model Code as set out in Appendix C3 to the Listing Rules as its own code of conduct for securities transactions. All Directors have confirmed, following specific enquiry by the Company with all Directors, that each of them has fully complied with the required standard as set out in the Model Code during 1H-2025.
AUDIT COMMITTEE
The audit committee of the Board ("Audit Committee") has reviewed with the management the accounting principles and practice adopted by the Group and reviewed the unaudited condensed consolidated interim financial information of the Group for 1H-2025. In addition, the unaudited condensed consolidated interim financial information of the Group for 1H-2025 has been reviewed but not audited by our auditor, Messrs. Deloitte Touche Tohmatsu. The Audit Committee comprises all three independent non-executive Directors.
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
47
CORPORATE INFORMATION
BOARD OF DIRECTORS
Executive Directors
Mr. WONG Cho Tung (Chairman)
Ms. YEUNG Man Ying
Mr. ZHU Wenhui
Mr. ZHU Qi
Non-executive Director
Mr. WONG Hei, Simon
Independent non-executive Directors
Mr. LIU Hing Hung (resigned as independent non-executive Director with effect from 25 January 2025)
Ms. LAI Ka Fung May (appointed as independent non-executive Director with effect from 25 January 2025)
Mr. LI Minbo
Mr. YANG Wentao
AUDIT COMMITTEE
Mr. LIU Hing Hung (Chairman) (resigned as chairman of Audit Committee with effect from 25 January 2025)
Ms. LAI Ka Fung May (Chairman) (appointed as chairman of Audit Committee with effect from 25 January 2025)
Mr. LI Minbo
Mr. YANG Wentao
REMUNERATION COMMITTEE
Mr. LIU Hing Hung (Chairman) (resigned as chairman of Remuneration Committee with effect from 25 January 2025)
Ms. LAI Ka Fung May (Chairman) (appointed as chairman of Remuneration Committee with effect from 25 January 2025)
Mr. LI Minbo
Mr. YANG Wentao
Mr. WONG Cho Tung
NOMINATION COMMITTEE
Mr. LIU Hing Hung (Chairman) (resigned as chairman of Nomination Committee with effect from 25 January 2025)
Ms. LAI Ka Fung May (Chairman) (appointed as chairman of Nomination Committee with effect from 25 January 2025)
Mr. LI Minbo
Mr. WONG Cho Tung
COMPANY SECRETARY
Ms. CHAN Chi Yin
AUDITORS
Certified Public Accountants
Registered public interest entity auditors
Deloitte Touche Tohmatsu
LEGAL ADVISER AS TO HONG KONG LAWS
LCH Lawyers LLP
48
SIM TECHNOLOGY GROUP LIMITED INTERIM REPORT 2025
CORPORATE INFORMATION
PRINCIPAL BANKERS
Hang Seng Bank Limited
Shanghai Pudong Development Bank
BERMUDA REGISTERED OFFICE
Clarendon House
2 Church Street
Hamilton HM11
Bermuda
HONG KONG REGISTERED OFFICE
Unit 1206, 12th Floor
Billion Trade Centre
31 Hung To Road
Kwun Tung
Hong Kong
SHANGHAI HEAD OFFICE
Block A, SIM Technology Building
No. 633 Jinzhong Road
Changning District
Shanghai
PRINCIPAL SHARE REGISTRAR AND TRANSFER OFFICE
Appleby Global Corporate Services (Bermuda) Limited
Canon's Court
22 Victoria Street
PO Box HM 1179
Hamilton HM EX
Bermuda
HONG KONG BRANCH SHARE REGISTRAR AND TRANSFER OFFICE
Computershare Hong Kong Investor Services Limited
Shops 1712-1716, 17th Floor
Hopewell Centre
183 Queen's Road East
Wanchai
Hong Kong
WEBSITE ADDRESS
http://www.sim.com
STOCK CODE
2000