Interim report for the six months ended 30 september 2025

榮 暉 控 股 有 限 公 司

(Incorporated in the Cayman Islands with limited liability)

GEM has been positioned as a market designed to accommodate small and mid-sized companies to which a higher investment risk may be attached than other companies listed on the Stock Exchange. Prospective investors should be aware of the potential risks of investing in such companies and should make the decision to invest only after due and careful consideration.

Given that the companies listed on GEM are generally small and mid-sized companies, there is a risk that securities traded on GEM may be more susceptible to high market volatility than securities traded on the Main Board and no assurance is given that there will be a liquid market in the securities traded on GEM.

Hong Kong Exchanges and Clearing Limited and the Stock Exchange take no responsibility for the contents of this report, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this report.

This report, for which the directors (the "Directors") of StarGlory Holdings Company Limited (the "Company") collectively and individually accept full responsibility, includes particulars given in compliance with the Rules Governing the Listing of Securities on GEM of the Stock Exchange (the "GEM Listing Rules") for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this report is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this report misleading.

The board of Directors (the "Board") of the Company hereby announces the unaudited condensed consolidated interim results of the Group for the six months ended 30 September 2025, together with the comparative unaudited consolidated figures for the corresponding period last year:

For the six months ended 30 September 2025

For the six months ended 30 September

For the six months ended 30 September 2025

For the six months ended 30 September

2025 2024

(Unaudited) (Unaudited)

HK$'000 HK$'000

Loss for the period (10,345) (11,352)

Other comprehensive loss:

Items that may be subsequently reclassified to profit or loss:

Exchange loss arising from translation of financial statements

of foreign operations (3) (165)

Total comprehensive loss for

the period (10,348) (11,517)

Total comprehensive loss for

As at 30 September 2025

For the six months ended 30 September 2025

Attributable to owners of the Company

At 1.4.2024 (audited) Acquisition of a subsidiary Total comprehensive loss

Loss for the period

Other comprehensive loss:-

Exchange loss arising from translation of financial statements of foreign operations

Total comprehensive loss for the period At 30.9.2024 (unaudited)

At 1.4.2025 (audited)

Total comprehensive loss

Loss for the period

Other comprehensive loss:-

Exchange loss arising from translation of financial statements of foreign operations

Total comprehensive loss for the period

At 30.9.2025 (unaudited)

For the six months ended 30 September

EFFECT OF FOREIGN EXCHANGE

RATE CHANGE (409) (15)

CASH AND CASH EQUIVALENTS AT

THE END OF THE PERIOD 13,721 18,334

Notes:

1. BASIS OF PREPARATION

   1. These unaudited condensed consolidated interim results have been prepared in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting" issued by the Hong Kong Institute of Certified Public Accountants ("HKICPA"), accounting principles generally accepted in Hong Kong and the disclosure requirements of the Hong Kong Companies Ordinance and are prepared under the historical cost convention and the disclosures required by the Rules Governing the Listing of Securities on GEM of the Stock Exchange.

      These unaudited condensed consolidated interim results should be read in conjunction with the consolidated financial statements for the year ended 31 March 2025, which have been prepared in accordance with Hong Kong Financial Reporting Standards ("HKFRS Accounting Standards").

      These unaudited condensed consolidated interim results have been prepared in accordance with the same accounting policies adopted in the 2025 annual financial statements, except for all the new and amendments to HKFRS Accounting Standards issued by the HKICPA that are relevant to its operations and effective for its annual period beginning on 1 April 2025. The adoption of these new and amendments to HKFRS Accounting Standards did not result in significant changes to the Group's accounting policies, presentation of the Group's unaudited condensed consolidated interim results and amounts reported for the current period and prior periods.

   2. Adoption of the going concern basis

      When preparing the unaudited condensed consolidated interim results, the Group's ability to continue as a going concern has been assessed. These unaudited condensed consolidated interim results have been prepared by the Directors on a going concern basis notwithstanding that the Group had net current liabilities and net liabilities of approximately HK$117,382,000 and HK$141,076,000 respectively as at 30 September 2025 as the Directors considered that:

      1. Ms. Huang Li, being the sole beneficial owner of the ultimate holding company of the Group, has agreed to provide continuing financial support to the Group;

      2. On 11 June 2025, Mr. Tang Sing Ming Sherman ("Mr. Tang"), as a lender, who is also the sole beneficial owner of the convertible bonds ("Convertible Bonds") issued by the Company, signed a memorandum of loans with a subsidiary of the Company, pursuant to which repayment date of a loan from Mr. Tang with an outstanding balance of principal and interest of approximately HK$100,606,000 as at 31 March 2025 was extended (the "Extension") from 22 June 2025 to 22 June 2026 (the "Extended Loan"). The Extended Loan bears the same term after the Extension.

      3. Subsequent to 31 March 2025, a major supplier of the Group whom the Group owed an amount of approximately HK$21,581,000 as at 31 March 2025, which was included in trade creditors under creditors and accruals as set out in note 22, has agreed not to demand for repayment of the amounts owed by the Group before 30 June 2026.

         After taking into consideration of the above factors and funds expected to be generated internally based on the Directors' estimation on future cash flow of the Group, the Directors are satisfied that the Group will have sufficient financial resources to meet its financial obligations as they fall due in the foreseeable future and consider that it is appropriate for the unaudited condensed consolidated interim results to be prepared on a going concern basis since there are no material uncertainties related to events or conditions that may cast significant doubt upon the Group's ability to continue as a going concern.

2. REVENUE

   Revenue represents invoiced value recognized in respect of provision of food and beverage services and others, net of discounts and value-added tax, during the period. An analysis of the revenue recorded for the period is set out below:

   For the six months ended 30 September

   2025 2024

   (Unaudited) (Unaudited)

   HK$'000 HK$'000

   Revenue from customers and recognized at a point in time basis

   • Provision of food and beverage services 377 2,142

   • Sales of cakes 7,940 20,249

   • Provision of photovoltaic products and

   related raw materials 2,616 -

   10,933 22,391

3. LOSS BEFORE INCOME TAX

   For the six months ended 30 September

   2025 2024

   (Unaudited) (Unaudited)

   HK$'000 HK$'000

   Loss before income tax is arrived at after charging:

   (a) Finance costs: Interest expense on other loans	587		587
   Interest expense on convertible bonds	2,747		400
   Interest expense on lease liabilities	44		154
   Other bank charges	138		348
   	3,516		1,489
   (b) Other items: Amortization of other intangible assets	394		381
   Depreciation of plant and equipment	111		443
   Depreciation of right-of-use assets	1,846		3,539

4. INCOME TAX

   Taxation in the condensed consolidated statement of profit or loss represents:

   For the six months ended 30 September

   	2025 (Unaudited) HK$'000		2024 (Unaudited) HK$'000
   Current tax	-		-
   Deferred tax	-		(7)
   Income tax credit	-		(7)

   1. Pursuant to the rules and regulations of the Cayman Islands and the British Virgin Islands ("BVI"), the Group is not subject to any income tax in the Cayman Islands and BVI.

   2. The Company's subsidiaries incorporated/established in Hong Kong and the People's Republic of China ("PRC") are subject to Hong Kong Profits Tax and PRC Enterprise Income Tax at the rates of 16.5% and 25% respectively (2024: Hong Kong - 16.5% and PRC - 25% respectively).

5. LOSS PER SHARE

   The calculation of basic loss per share is based on the loss attributable to owners of the Company of approximately HK$10,345,000 (2024: approximately HK$11,352,000) and the weighted average number of ordinary shares of 555,057,588 (2024: ordinary shares of 520,771,875) in issue during all periods.

   The computation of diluted loss per share does not assume the conversion of the Company's outstanding Convertible Bonds since these potential ordinary shares have anti-dilutive effects on loss per share for both the six months ended 30 September 2025 and 2024.

6. DEBTORS, DEPOSITS AND PREPAYMENTS

   Debtors, deposits and prepayments comprise:-

   As at As at

   30 September 31 March

   2025 2025

   (Unaudited) (Audited)

   HK$'000 HK$'000

   Trade debtors 3,280 311

   Less: loss allowance - -

   3,280 311

   Rental and utility deposits 8,508 4,676

   Prepayments 317 2,987

   Other debtors 1,603 3,510

   13,708 11,484

   1. Loss allowance

      Loss allowance in respect of trade debtors is recorded using loss allowance account unless the Group is satisfied that recovery of the amount is remote, in which case the loss allowance is written off against trade debtors.

      Movements of loss allowance for trade debtors are as follows:-

      As at As at

      30 September 31 March

      2025 2025

      (Unaudited) (Audited)

      HK$'000 HK$'000

      At beginning of the period/year - -

      Reversal of impairment - -

      At end of the period/year - -

   2. Aging analysis

      The trading terms with the Group's customers for provision of food and beverage services are mainly on cash and non-cash basis settlements, except for well established corporate customers who are granted credit term of 30-60 days. For non-cash basis settlements, the counterparties normally settle the balances within 2-60 days. The following was an aging analysis of trade debtors (net of loss allowance), which included outstanding balances for non-cash basis settlements, based on the invoice date, at the end of the reporting period:-

      	As at 30 September		As at 31 March
      	2025		2025
      	(Unaudited) HK$'000		(Audited) HK$'000
      0-30 days	71		166
      31-60 days	2,942		1
      61-90 days	-		-
      91-180 days	-		144
      Over 180 days	267		-
      	3,280		311

   3. Trade debtors that are not impaired

The aging analysis of trade debtors that are not considered to be impaired was as follow:-

Trade debtors that were neither past due nor impaired relate to customers for whom there was no recent history of default.

Trade debtors that were past due but not impaired relate to a number of independent customers that have a good track record with the Group. Based on past experience, management believes that no loss allowance is necessary in respect of these balances as there has not been a significant change in credit quality and the balances are still considered fully recoverable. The Group does not hold any collateral over these balances.

The Group applies the simplified approach to provide for expected credit losses prescribed by HKFRS 9, which permits the use of the lifetime expected loss provision for trade debtors. To measure the expected credit losses, these debtors have been grouped based on shared credit risk characteristics and the aging from billing.

The following was an aging analysis, based on invoice date, of trade creditors:-

Other loan from a lender of approximately HK$97,864,000 (31 March 2025: HK$97,864,000) as at 30 September 2025 is unsecured, carries interest rate at 0.1% per month and repayable on 22 June 2026 (31 March 2025: 22 June 2025). Remaining loans of approximately HK$2,557,000 (31 March 2025: approximately HK$2,508,000) are interest-free, unsecured and repayable on demand. On 8 April 2024, Mr. Tang Sing Ming Sherman, as the lender, who is also the sole beneficial owner of the Convertible Bonds issued by the Company, signed a memorandum of loans with a subsidiary of the Company, pursuant to which repayment date of a loan from Mr. Tang with an outstanding balance of principal and interest of approximately HK$99,431,000 as at 31 March 2024 was extended from 22 June 2024 to 22 June 2025. On 11 June 2025, Mr. Tang signed another memorandum of loans with a subsidiary of the Company, pursuant to which the repayment date of a loan from Mr. Tang with an outstanding balance of principal and interest of approximately HK$100,606,000 as at 31 March 2025 was extended from 22 June 2025 to 22 June 2026. The Extended Loan bears the same term after the Extension. The rest of the loan from Mr. Tang is interest-free, unsecured and repayable on demand.

Interest payable to this lender of approximately HK$1,567,000 (31 March 2025: approximately HK$2,742,000) is included in interest payables.

Other loan of approximately HK$5,702,000 (31 March 2025: approximately HK$5,949,000) as at 30 September 2025 is unsecured, interest-free and repayable on demand.

1. RELATED PARTY AND CONNECTED TRANSACTIONS

   The Group had no material transactions with its related parties and connected persons as defined in HKAS 24 and GEM Listing Rules for the six months ended 30 September 2025 and 2024.

   Directors and key management personnel remunerations

   For the six months ended 30 September

   	2025 (Unaudited) HK$'000		2024 (Unaudited) HK$'000
   Fees	390		390
   Salaries, allowances and other benefits in kind	1,153		1,277
   Retirement scheme contributions	37		20
   	1,580		1,687

2. SEGMENT INFORMATION

   HKFRS 8 requires operating segments to be identified on the basis of internal reports about components of the Group that are regularly reviewed by the Directors, being the chief operating decision maker ("CODM") in order to allocate resources to the segment and to assess its performance.

   During the six months ended 30 September 2025, the Group principally operated in two business units, and had two reportable and operating segments: food and beverage and photovoltaic business.

   1. Food and beverage - Provision of food and beverage services, operating of restaurants and cake shops in Hong Kong.

   2. Photovoltaic business - Trading of photovoltaic products and related raw materials in the PRC.

      1. Segment revenue and results

         For the six months ended 30 September 2025

         The following is an analysis of the Group's revenue and results by reportable segments.

         Food and beverage Photovoltaic Total

         	2025	2024	2025	2024	2025	2024
         	HK$'000	HK$'000	HK$'000	HK$'000 (Restated)	HK$'000	HK$'000
         Segment revenue (external)	8,317	22,391	2,616	-	10,933	22,391
         Segment loss	(2,783)	(5,643)	(1,101)	(2,458)	(3,884)	(8,101)

         Interest income	18	44
         Share of result of an associate	(161)	(246)
         Miscellaneous items	1	-
         Finance costs	(2,755)	(428)
         Depreciation of plant and equipment	(9)	(38)
         Depreciation of right-of-use assets	(680)	(686)
         Unallocated operating expenses	(2,875)	(1,897)
         Loss before income tax	(10,345)	(11,352)

         Segment loss represents the loss incurred from each segment without the allocation of interest income, share of result of an associate, miscellaneous items, finance costs, and central operating expenses. This is the measure reported to the CODM for the purpose of resource allocation and performance assessment.

      2. Segment assets and liabilities

         The following is an analysis of the Group's assets and liabilities by reportable segments:

         As at 30 September 2025

         Segment assets

         Food and beverage Photovoltaic Total

         At 30 September

         2025

         At 31 March

         2025

         At 30 September

         2025

         At 31 March

         2025

         At 30 September

         2025

         At 31 March

         2025

         HK$'000 HK$'000 HK$'000 HK$'000 HK$'000 HK$'000

         (Restated) Segment assets 14,647 16,813 15,113 - 29,760 16,813

         Unallocated assets 6,093 29,468

         Consolidated total assets 35,853 46,281

         Segment liabilities

         Food and beverage Photovoltaic Total

         At 30 September

         2025

         At 31 March

         2025

         At 30 September

         2025

         At 31 March

         2025

         At 30 September

         2025

         At 31 March

         2025

         HK$'000 HK$'000 HK$'000 HK$'000 HK$'000 HK$'000

         (Restated) Segment liabilities 128,765 129,852 8,966 - 137,731 129,852

         Unallocated liabilities 39,198 47,157

         Consolidated total liabilities 176,929 177,009

         For the purpose of monitoring segment performance and allocating resources between segments:

         All assets are allocated between operating segments other than certain plant and equipment, certain right-of-use assets, certain deposits and prepayments, certain cash and cash equivalents and unallocated corporate assets of headquarter.

         All liabilities are allocated between operating segments other than certain creditors and accruals, certain lease liabilities, convertible bonds and unallocated corporate liabilities of headquarter.

      3. Segment information

         For the six months ended 30 September 2025

         Food and beverage Photovoltaic Total

         2025 2024 2025 2024 2025 2024

         HK$'000 HK$'000 HK$'000 HK$'000 HK$'000 HK$'000

         (Restated)

         Amounts included in the measure of segment profit or loss or segment assets:

         Depreciation of plant
         and equipment	102	406	9	37	111	443
         Depreciation of
         right-of-use assets	1,166	2,844	680	695	1,846	3,539
         Franchise and royalties expenses	234	734	-	-	234	734
         Short term lease expenses	517	1,111	223	237	740	1,348
         Amortization of other
         intangible assets	394	381	-	-	394	381
         	At	At	At	At	At	At
         	30 September	31 March	30 September	31 March	30 September	31 March
         	2025	2025	2025	2025	2025	2025
         	HK$'000	HK$'000	HK$'000	HK$'000	HK$'000	HK$'000
         Additions to non-current assets	6	1,893	-	-	6	1,893

      4. Geographical information

         		PRC		Hong Kong			Total
         	2025		2024	2025	2024	2025		2024
         	HK$'000		HK$'000	HK$'000	HK$'000	HK$'000		HK$'000
         Revenue	2,616		-	8,317	22,391	10,933		22,391
         	At		At	At	At	At		At
         	30 September		31 March	30 September	31 March	30 September		31 March
         	2025		2025	2025	2025	2025		2025
         	HK$'000		HK$'000	HK$'000	HK$'000	HK$'000		HK$'000
         Non-current assets	1,654		2,341	6,719	7,994	8,373		10,335

         The geographical location of customers is based on the location at which the services were provided or the goods delivered. The geographical location of the non-current assets is based on (i) the physical location of the assets, in the case of plant and equipment, (ii) the location of the operation to which they are allocated, in the case of intangible assets and right-of-use assets, and (iii) the location of operation to which they are incurred, in the case of deposits paid.

      5. Major customers

Revenue from major customer in the segment of photovoltaic, accounted for 10% or more of the Group's revenue, are set out below:

The Board does not recommend the payment of interim dividend in respect of the six months ended 30 September 2025 (2024: Nil).

The Group's unaudited revenue for the six months ended 30 September 2025 (the "Reporting Period") amounted to approximately HK$10.9 million (2024: approximately HK$22.4 million), representing a decrease of approximately 51.3% compared with the same period of the last financial year. Loss attributable to owners of the Company decreased to approximately HK$10.3 million for the six months ended 30 September 2025 from approximately HK$11.3 million recorded in the corresponding period last financial year.

Industry Overview

As at 30 September 2025, the global economy continued to experience moderate growth amid persistent high interest rates and ongoing geopolitical tensions. International inflation pressures have eased, while major economies have adopted a more prudent and supportive policy stance.

The Chinese economy maintained a stable recovery, achieving a year-on-year GDP growth of approximately 5% or above in the first half of 2025. The high-tech manufacturing and clean energy sectors delivered outstanding performance. Clean energy generation accounted for more than 30% of China's total power output and China continued to lead globally in the photovoltaic ("PV") sector. Although the growth rate of new PV installations in the first half of 2025 in China has slowed relative to the previous year, the total installed capacity and export volume of PV has continued to expand in light the ongoing policy support and strong domestic demand. This has in turn driven the continuous expansion of the PV-related industry chain and hence presented favourable opportunities for the Group's PV products business which is based in China.

Hong Kong's economy maintained a steady recovery trend in the first three quarters of 2025, with real gross domestic product (GDP) growing by approximately 3.0% to 3.8%. Despite the overall favorable economic performance, the local catering industry continued to face challenges arising from high rental costs, labor shortages, and shifts in consumption patterns from traditional dine-in to takeaway and outbound spending. As a result, the increase in total catering revenue was limited, and the overall number of restaurants continued to decline.

Business Review

During the Reporting Period, although Hong Kong's overall economy maintained growth, the catering industry was more significantly affected by changing consumer habits and fluctuations in resident consumption confidence. The economic environment remains uncertain in the short term, leading to intense competition and frequent price wars within the industry. The persistent shortage of labor and rising operating costs have increased business pressure across the sector, causing some restaurants to face operational difficulties, downsize, or even exit the market.

In response to subdued local consumption, the Group introduced timely promotional offers tied to various festive seasons and launched a series of bakery product gift boxes to attract both local customers and the growing number of visitors from Mainland China. The Group continued to enforce stringent cost control measures, including outsourcing certain production processes and human resources functions for offices and retail outlets, to maintain product and service quality while addressing customer needs efficiently.

During the Reporting Period, the Group also made solid progress in diversifying its business portfolio and officially commenced its photovoltaic operations. For the six months ended 30 September 2025, the Group began recording revenue from its PV products, marking a meaningful step forward into the renewable energy sector. The PV business is aligned with market demand and national policy trends in China, focusing on the value chain for solar cells and related materials. The Group has been optimizing its industrial deployment, integrating in-house R&D capabilities with external market resources, and continuously strengthening supply chain collaboration and production line efficiency to capture growth opportunities arising from the renewable energy transition.

Future Prospects

Looking ahead, the Group will continue to implement a strategy of "steady growth with focused breakthroughs." The downturn in Hong Kong's economy and the transformation of consumer behaviours have led to a wave of restaurant closures across the catering industry. Rising labour costs have further compressed operating margins. The Group will maintain its existing operation model, focusing on strict cost management to enhance operational efficiency and sustain business stability.

In terms of industrial development, the global transition toward clean energy continues to present substantial growth potential in PV installation capacity. The Group's PV business, which has started contributing revenue during the Reporting Period, will remain one of its key development priorities. The Group will continue to advance research and industrialization of high-precision PV screen printing technologies to strengthen its competitiveness.

The Group will remain focused on its energy business and will from time to time review its business portfolio to further consolidate and grow its operations. In the long term, the Group will actively seek suitable investment opportunities to diversify its revenue base and business structure, laying a solid foundation for sustainable growth and creating long-term value for shareholders.

For the six months ended 30 September 2025, the Group recorded revenue of approximately HK$10.9 million (2024: approximately HK$22.4 million), which decreased by approximately 51.3% compared with the corresponding period last financial year. This decrease in revenue reflects the ongoing transformation in consumer behavior patterns, characterized by a measured shift towards value-oriented purchasing decisions amid evolving macroeconomic conditions. The emergence of cross-border consumption alternatives has further influenced this trend. The interplay of regional market dynamics and the growing presence of e-commerce platforms has presented new challenges for Hong Kong's food and beverage sector. While the Hong Kong government's initiatives to stimulate consumption have yielded modest improvements in consumer sentiment, the industry continues to navigate through a period of adjustment.

Loss attributable to owners of the Company was approximately HK$10.3 million (2024: approximately HK$11.3 million).

Gross profit

The gross profit margin from the operations of the Group was approximately 40.9% (2024: approximately 43.4%), it remains stable. In response to evolving market dynamics, the Group has proactively diversified its product portfolio by introducing an expanded range of peripheral and seasonal offerings, including mooncakes, egg rolls, and French palmier products. While these new product categories currently operate at different margin profiles compared to our traditional cake offerings, they represent an important strategic initiative to broaden our market reach and create additional revenue streams. The Group remains focused on optimizing its product mix and implementing operational enhancements to gradually strengthen overall profitability while maintaining market competitiveness.

Other income

Other income of the Group for the Reporting Period decreased by 68.4% to approximately HK$0.1 million (2024: approximately HK$0.3 million). The decrease was mainly due to the decrease in interest income and miscellaneous income compared with the corresponding period last financial year.

Finance costs

Finance cost of the Group for the Reporting Period increased by 136.1% to approximately HK$3.5 million (2024: approximately HK$1.5 million). This increase was primarily attributable to higher interest expenses on convertible bonds, resulting from the reassessment of their fair value following an extension.

Operating expenses

The Group strived to exercise stringent cost control and further enhanced operational efficiency during the Reporting Period. As a result, total operating expenses for the operations decreased by approximately 42.8% to approximately HK$11.2 million (2024: approximately HK$19.7 million). The decrease in operating expenses as compared to last financial year was in line with the decrease in revenue and also reflects the Group's strategic refinement of its retail portfolio, specifically the calibrated optimization of our outlet network. This measured action aligns with its strategic imperative to enhance resource allocation and strengthen operations around high-potential locations. As a result of these strategic initiatives, the Group achieved an improvement in operational efficiency, with total operating expenses moderated to HK$11.2 million during the Reporting Period.

Financial Resources and Liquidity

As at 30 September 2025, the Group's current assets amounted to approximately HK$27.5 million (31 March 2025: approximately HK$35.9 million) of which approximately HK$13.7 million (31 March 2025: approximately HK$24.4 million) was cash and cash equivalents, and approximately HK$13.7 million (31 March 2025: approximately HK$11.5 million) was debtors, deposits and prepayments. The Group's current liabilities amounted to approximately HK$144.9 million (31 March 2025: approximately HK$147.2 million), including creditors and accruals in the amount of approximately HK$36.3 million (31 March 2025: approximately HK$37.4 million), approximately HK$106.1 million (31 March 2025: approximately HK$106.3 million) was other loans.

As at 30 September 2025, the principal amount of the convertible bonds issued by the Company amounted to approximately HK$40 million (31 March 2025: approximately HK$40 million). On 13 August 2021, the Company entered into the third supplemental deed with the bondholder pursuant to which the Company and the bondholder agreed to extend the maturity date of the Convertible Bond (as defined in the announcement of the Company dated 13 August 2021) for 36 months from the date falling on the sixth anniversary of the date of issue of the convertible bonds, being 15 August 2021, to 15 August 2024. On 12 August 2024, the Company entered into the Fourth Supplemental Deed with the bondholder, Mr. Tang, pursuant to which the Company and the bondholders agreed to further extend the maturity date of the Convertible Bonds by 36 months, being 15 August 2024, to 15 August 2027.

The current ratio and quick assets ratio of the Group as at 30 September 2025 were

0.19 and 0.18 respectively (31 March 2025: 0.24 and 0.23 respectively). As the Group incurred net liabilities as at 30 September 2025 and 31 March 2025, there is no debt-to-equity ratio, which is expressed as a ratio of total debts less cash and bank balances to total equity, to be calculated. The gearing ratio of the Group, which is calculated by dividing total liabilities (being non-current liabilities and current liabilities) over total assets (being non-current assets and current assets) as at the end of the year and multiplying by 100% was 493% (31 March 2025 : 382%).

Foreign Exchange

During both periods for the six months ended 30 September 2025 and 2024, the Group conducted commercial transactions in the PRC denominated in Renminbi. Fluctuations in exchange rates of Renminbi against Hong Kong Dollar could affect the Group's results of operations.

During the Reporting Period, no hedging transactions or other exchange rate arrangements were made (2024: Nil).

Charges on the Group's Assets

No Group's assets had been pledged or charged as at 30 September 2025 (31 March 2025: Nil).

Capital Structure

The Group's operations were financed mainly by internal funds, loans from the sole beneficial owner of the convertible bonds issued by the Company, loans from independent third party and fund raised from rights issue. The Group will continue to adopt its treasury policy of placing its cash and cash equivalents as interest-bearing deposits. The Group's cash and cash equivalents were mainly denominated in Hong Kong dollar and the Group's other loans and principal amount of the convertible bonds issued by the Company both were denominated in Hong Kong dollar, as at 30 September 2025 amounted to approximately HK$106,100,000 and HK$32,000,000, respectively (31 March 2025: approximately HK$106,300,000 and HK$29,300,000 respectively). As at 30 September 2025, the Group's borrowings with fixed interest rates amounted for 100% (31 March 2025: 100%) of total borrowings.

Acquisition, disposal and significant investment held

The Group did not carry out significant acquisition or disposal of subsidiaries and associates or held any significant investment during the Reporting Period.

Capital commitments

As at 30 September 2025, the Group's outstanding capital commitments were approximately HK$548,000 (31 March 2025: approximately HK$2,384,000).

Contingent Liabilities

As at 30 September 2025 and 31 March 2025, the Group did not have any material contingent liabilities.

Save as disclosed above, during the six months ended 30 September 2025 and 2024, there was no on-going financial exposure to borrowers or other on-going matters of relevance as defined in Rules 17.22 to 17.24 of the GEM Listing Rules.

Employees and Remuneration Policies

As at 30 September 2025, the Group had 29 full-time employees in Hong Kong and the PRC (31 March 2025: 42 full-time employees in Hong Kong and the PRC). The remuneration of employees of the Group is determined by reference to market terms and in accordance with the performance, qualification and experience of each individual employee. Discretionary bonuses, based on each individual's performance, are paid to employees as recognition and reward for their contributions. Other fringe benefits such as medical subsidies, medical insurance, education/training subsidies, pension fund plans are offered to most employees. Share options are granted at the discretion of the Board and under the terms and conditions of the share option schemes adopted on 26 February 2003, 20 July 2012 and 22 September 2023.

On 27 April 2017, the Company announced that it proposed to raise approximately HK$100 million, before expenses, by allotting and issuing 1,388,725,000 rights shares (the "Rights Shares") by way of rights issue (the "Rights Issue") at the subscription price of HK$0.072 per Rights Shares, on the basis of one (1) Rights Shares for every two (2) existing shares held on 19 May 2017. Completion of the Rights Issue took place on 14 June 2017.

Among the net proceeds (the "Net Proceeds from the Rights Issue") of the Rights Issue of approximately HK$99 million, as at 30 September 2025, approximately HK$37.5 million, HK$22.5 million, HK$2.9 million, HK$18.5 million and HK$13.0 million have been used as operation and expansion of the existing food and beverage business, the Company's corporate expenses, investment in e-cigarette business in the PRC, investment in medical and healthcare business and investment in renewable energy and new material respectively. As at 30 September 2025, approximately HK$4.6 million of the Net Proceeds from the Rights Issue remained unutilized and this remaining balance was kept in the Group's bank account. Set out below is the breakdown of the use of the Net Proceeds from the Rights Issue up to, and the balance thereof as at 30 September 2025:

Summary of use of the Net Proceeds from the Rights Issue

Original

Re-allocation

of the unutilized amount as disclosed in

Re-allocation

of the

Re-allocation

of the unutilized

Re-allocation

of the unutilized

Actual

Re-allocation

of the unutilized amount

Actual

allocation the Company's

of the announcement

unutilized amount

amount during the

amount during the

amount utilized

Unutilized balance

during the six months

amount utilized

Unutilized balance

Net Proceeds from the Rights Issue

dated 6 November

2018

on/before 31 March

2023

year ended 31 March

2024

year ended 31 March

2025

up to 31 March

2025

as at 31 March

2025

period ended 30 September

2025

up to 30 September

2025

as at 30 September

2025

HK$ million HK$ million HK$ million HK$ million HK$ million HK$ million HK$ million HK$ million HK$ million HK$ million

Operation and expansion of the existing food and beverage

business 29.0 - - 5.6 2.9 (37.5) - - (37.5) -

Company's corporate expenses 20.0 - - - - (20.0) - 2.5 (22.5) -Repayment of bank loans 15.0 (15.0) - - - - - - - -Potential investment opportunities 35.0 - (12.0) (16.0) 0.1 - 7.1 (2.5) - 4.6

Investment in, research and development, sales and marketing of e-cigarette in the

PRC and overseas countries - 15.0 (6.5) (2.6) (3.0) (2.9) - - (2.9) -

Investment in medical and

healthcare business - - 18.5 - - (18.5) - - (18.5) -

Investment in renewable energy and

new material - - - 13.0 - (13.0) - - (13.0) -

99.0 - - - - (91.9) 7.1 - (94.4) 4.6

During the Reporting Period, the Group pursued a prudent yet efficient network expansion strategy and up to 30 September 2025, Net Proceeds from the Rights Issue amounting to approximately HK$22.5 million had been utilized for the Company's corporate expenses as approximately HK$2.5 million was reallocated for this purpose during the six months ended 30 September 2025.

As at 30 September 2025, approximately HK$37.5 million has been used for operating and expanding existing food and beverage business.

As disclosed in the Company's announcement dated 6 November 2018, the Company has changed the original allocation of the Net Proceeds from the Rights Issue by reallocating HK$15.0 million of the Net Proceeds from the Rights Issue originally planned to be applied for the repayment of bank loans to the intended investment in research and development, sales and marketing of e-cigarette in the PRC and overseas countries. In this connection, the Company planned to conduct research on the use of new ingredients for producing e-cigarette liquid and e-cigarette cartridge, purchase production lines for manufacturing e-cigarette, and market and sell such products through exploring and developing a sales network, building a new e-cigarette brand, participating into trade fairs and seeking cooperation with external parties. Up to 30 September 2025, the Group utilized approximately HK$2.9 million of the Net Proceeds from the Rights Issue to invest in the e-cigarette business in the PRC, including setting up office and purchasing new equipment. And, approximately HK$6.5 million, HK$2.6 million and HK$3.0 million, was reallocated on or before 31 March 2023 and during the years ended 31 March 2024 and 2025, respectively, to investment in the medical and healthcare business, operation and expansion of the existing food and beverage business and for potential investment opportunities, as set out below.

In recognition of the growing importance of medical and healthcare services and products, the Group strives to grasp the prosperous opportunities in the domestic market, thereby strengthening its core competence through broadening its revenue base. After thorough study and consideration, up to 30 September 2025, approximately HK$18.5 million in total, which represented by HK$6.5 million and HK$12.0 million of the Net Proceeds from the Rights Issue which were originally reserved for the e-cigarette business and potential investment opportunities respectively, was reallocated and utilized to invest in the medical and healthcare business in the domestic market, including brand building, office set-up, expert recruitment and product development.

The Group has been aiming to expand its existing food and beverage business and continued to identify suitable acquisition targets during the Reporting Period. However, taking into account sluggish economic recovery, weak private consumption, poor consumer sentiment and intense competition, the food and beverage industry continued to experience a tough period of time, which was further exacerbated by the increasing number of Hong Kong residents choosing to travel north for dining experiences. As a result, the Group adopted a relatively prudent approach in such business expansion. In order to weather the headwinds, the Group endeavored to explore potential acquisition opportunities in different markets. In view of the increasing significance of renewable energy, the Group allocated approximately HK$13.0 million from the Net Proceeds from the Rights Issue which were originally reserved for the potential investment opportunities towards its indirect wholly-owned subsidiaries for the advancement of research and development in renewable energy and new material products and businesses. This included a strategic investment of RMB7.0 million (equivalent to approximately HK$7.7 million) in Weihai Qingying Precision Technology Company Limited, acquiring a 20% equity stake in the company and obtaining an exclusive sales right in order to develop the sales business in this arena, and the Group has also initiated a technology collaboration partnership with the Harbin Institute of Technology, Weihai, involving a one-off payment of RMB2.8 million (equivalent to approximately HK$3.1 million) for research and development operation, to enhance its renewable energy business through a comprehensive approach. As for the remaining amount of RMB2.0 million (equivalent to HK$2.2 million), it will be used for general operating capital.

The Net Proceeds from the Rights Issue for potential investment opportunities purpose were still reserved and the unutilized balance of approximately HK$4.6 million allocated for this purpose is expected to be fully utilized by 31 December 2026. The actual timeline will be subject to the availability of appropriate acquisition targets, market condition and time required for performing due diligence work. As at the date of this interim report, the Board has not identified any suitable acquisition target.

The Directors will constantly evaluate the Group's business objectives and may change or modify the plans against the changing market condition to suit the business growth of the Group. Further announcement(s), in respect of redeploying the allocation and use of Net Proceeds from the Rights Issue, if necessary, will be made in accordance with the requirements of the GEM Listing Rules as and when appropriate to update its shareholders and potential investors.

Summary of use of the Net Proceeds from the Subscription

On 18 December 2024 (after trading hours of the Stock Exchange), the Company entered into a subscription agreement (the "Subscription Agreement(s)") with each of the subscribers (the "Subscribers"), namely Jumbo Grand International Limited and Ms. Zeng Huimei, pursuant to which each of the Subscribers has conditionally agreed to subscribe for, and the Company has conditionally agreed to allot and issue, in aggregate 34,285,713 new ordinary shares of the Company at the subscription price (the "Subscription Price") of HK$0.35 per subscription share (the "Subscription"). The closing price as quoted on the Stock Exchange on the date of the Subscription Agreements is HK$0.40 per Share. The net issue price was approximately HK$0.34 per subscription share. The Subscription was conducted under the general mandate granted to the Board at the annual general meeting dated 20 September 2024, for the purpose of, amongst others, strengthening the financial position and liquidity of the Group and meet any future development and financial obligations at a reasonable cost.

Completion of the Subscription took place on 13 January 2025 in accordance with the terms and conditions of the Subscription Agreements. The gross proceeds from the Subscription are approximately HK$12.0 million, and the net proceeds from the Subscription are approximately HK$11.7 million (the "Net Proceeds from the Subscription"). As at 30 September 2025, among the Net Proceeds from the Subscription, approximately HK$2.5 million, HK$0.3 million and HK$3.7 million have been used for operation of the existing food and beverage business, the Company's corporate expenses and for expansion of the Group's renewable energy and new material business. As at 30 September 2025, approximately HK$4.3 million of the Net Proceeds from the Subscription remained unutilized and this remaining balance was kept in the Group's bank account. Set out below is the breakdown of the use of the Net Proceeds from the Subscription up to, and the balance thereof as at 30 September 2025:

Summary of use of the Net Proceeds from the Subscription

Operation of the existing food and beverage business

Company's corporate expenses Expansion of the Group's renewable

energy and new material business

For the reasons, details and details of the proposed used of proceeds of the Subscription, please refer to the announcements of the Company dated 18 December 2024 and 13 January 2025.