Earnings release
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Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, 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 announcement. (Incorporated in the Cayman Islands with limited liability) (Stock Code: 3883) ANNOUNCEMENT OF INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2026 The board (the “Board”) of directors (the “Director(s)”) of China Aoyuan Group Limited (“China Aoyuan”, “Aoyuan” or the “Company”) presents the unaudited interim results of the Company and its subsidiaries (collectively, the “Group”) for the six months ended 30 June 2026 (the “Reporting Period”) together with comparative figures for the corresponding period in the previous year as follows: CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME FOR THE SIX MONTHS ENDED 30 JUNE 2026 Six months ended 30.6.2026 30.6.2025 NOTES RMB’000 RMB’000 (Unaudited) (Unaudited) Revenue 3 Contracts with customers 3,658,493 4,404,258 Leases 45,814 61,479 Total revenue 3,704,307 4,465,737 Cost of sales (5,148,142) (7,306,587) Gross loss (1,443,835) (2,840,850) Other income, gains and losses, net 5 (631,735) (1,587,716) Change in fair value of investment properties (306,718) (355,000) Selling and distribution expenses (45,884) (159,764) Administrative expenses (179,327) (348,640) Loss on disposal of subsidiaries (930,431) (836,185) Share of results of joint ventures (108,209) (102,053) Share of results of associates (56,945) (146,168) Finance costs 7 (2,712,935) (2,850,996) Loss before tax (6,416,019) (9,227,372) Income tax expenses 6 (109,345) (252,468) Loss for the period 7 (6,525,364) (9,479,840) 1
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Other comprehensive (expenses)/income Item that may be reclassified subsequently to profit or loss: Exchange differences on translation of foreign operations (1,003) (58,162) Items that will not be reclassified to profit or loss: Fair value (loss) on equity instruments designated at fair value through other comprehensive income (“FVTOCI”) 4,828 (1,346) OTHER COMPREHENSIVE INCOME/(EXPENSES) FOR THE PERIOD 3,825 (59,508) Total comprehensive expenses for the period (6,521,539) (9,539,348) Loss for the period attributable to: Owners of the Company (6,270,815) (8,814,418) Non-controlling interests (254,549) (665,422) (6,525,364) (9,479,840) Total comprehensive expenses for the period attributable to: Owners of the Company (6,266,990) (8,873,926) Non-controlling interests (254,549) (665,422) (6,521,539) (9,539,348) Loss per share (RMB cents) Basic 9 (113) (217) Diluted (113) (217) CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME (CONT’D) Six months ended 30.6.2026 30.6.2025 Notes RMB’000 RMB’000 (unaudited) (unaudited) 2
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CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION AT 30 JUNE 2026 30.6.2026 31.12.2025 NOTES RMB’000 RMB’000 (Unaudited) (Audited) NON-CURRENT ASSETS Property, plant and equipment 1,386,160 1,479,328 Right-of-use assets 340,460 357,790 Investment properties 6,386,248 7,090,224 Intangible assets – – Interests in joint ventures 1,891,499 1,999,736 Interests in associates 638,679 695,624 Financial assets at fair value through profit or loss (“FVTPL”) 155,465 155,465 Equity instruments designated at FVTOCI 156,713 151,886 Deferred tax assets 25,695 36,037 Total non-current assets 10,980,919 11,966,090 CURRENT ASSETS Properties for sale 68,792,908 75,232,908 Inventories 548 7,606 Trade and other receivables 10 20,962,467 22,317,955 Amounts due from non-controlling shareholders of subsidiaries 840,094 841,808 Amounts due from joint ventures 10,729,383 11,070,380 Amounts due from associates 389,392 539,690 Financial assets at FVTPL 538,356 600,275 Tax recoverable 3,540,356 4,052,592 Restricted bank deposits 1,141,905 1,409,804 Bank balances and cash 208,476 184,018 Total current assets 107,143,885 116,257,036 3
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30.6.2026 31.12.2025 NOTES RMB’000 RMB’000 (Unaudited) (Audited) CURRENT LIABILITIES Trade and other payables 11 60,337,534 58,778,831 Contract liabilities 14,233,206 18,371,715 Amounts due to non-controlling shareholders of subsidiaries 1,855,113 1,852,676 Amounts due to joint ventures 7,492,274 7,462,549 Amounts due to associates 1,157,543 1,158,215 Tax liabilities 11,482,054 11,581,219 Bank and other borrowings 45,196,338 46,419,948 Lease liabilities 617,583 598,633 Senior notes and bonds 24,551,704 9,645,304 Convertible bonds 360,530 401,664 Total current liabilities 167,283,879 156,270,754 NET CURRENT LIABILITIES (60,139,994) (40,013,718) TOTAL ASSETS LESS CURRENT LIABILITIES (49,159,075) (28,047,628) NON-CURRENT LIABILITIES Bank and other borrowings 897,267 932,916 Deferred tax liabilities 601,446 671,610 Lease liabilities 999,560 976,864 Senior notes and bonds – 14,529,300 Deferred income 486,750 486,750 Total non-current liabilities 2,985,023 17,597,440 NET LIABILITIES (52,144,098) (45,645,068) EQUITY CAPITAL AND RESERVES Share capital 43,582 42,529 Reserves (51,563,540) (45,326,516) Equity attributable to owners of the Company (51,519,958) (45,283,987) Non-controlling interests (624,140) (361,081) TOTAL EQUITY (52,144,098) (45,645,068) CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION (CONT’D) 4
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NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS For the six months ended 30 June 2026 1. BASIS OF PREPARATION OF CONDENSED CONSOLIDATED FINANCIAL STATEMENTS The condensed consolidated financial statements of China Aoyuan Group Limited and its subsidiaries (collectively “the Group”) for the six months ended 30 June 2026 have been prepared in accordance with International Accounting Standard (“IAS”) 34 “Interim Financial Reporting” issued by the International Accounting Standards Board (the “IASB”) and the applicable disclosure requirements of Appendix D2 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the (“Stock Exchange”) (the “Listing Rules”). Going concern basis For the six months ended 30 June 2026, the Group recorded a net loss of approximately RMB6,525 million and a net operating cash outflow. At the same date, the Group’s total bank and other borrowings, senior notes and bonds amounted to RMB70,645 million, out of which RMB69,748 million will be due for repayment within the next twelve months from the end of the reporting period. Further, the Group has commitments including its share of commitments made jointly with investors relating to its joint ventures in aggregate of approximately RMB12,421 million, while the Group has total bank balances and cash (including restricted bank deposits) of approximately RMB1,350 million. The real estate sector in the PRC continues to experience continuing challenges and volatility, the Group experienced a significant decline of its contracted sales of property in 2026, which adversely impacted the Group’s cash receipts from sales and pre-sales of properties. In order to improve the Group’s liquidity and cash flows to sustain the Group as a going concern, the Directors implemented or are in the process of implementing the following measures: (a) The Group has been actively promoting a comprehensive restructuring of onshore debts of the Group to establish a long-term mechanism to alleviate debt pressure and strengthen the full-cycle cash flow risk control system to ensure operational stability of the Group. The Group is close to the finalisation of the onshore debts restructuring proposal and is in the process of soliciting opinions from all parties (including onshore creditors). (b) The Group has been actively negotiating with various onshore lenders on the renewal and extension of borrowings. During the Reporting Period and up to the date of approval of these condensed consolidated financial statements, the Group has entered into contractual arrangements with certain onshore financial institutions to extend the maturity of existing onshore financing arrangements, involving onshore borrowings of approximately RMB2 million in principal amount. The Directors consider that the Group will be able to extend the repayment period for its other onshore financing arrangements. (c) The Group has been actively exploring potential asset disposal opportunities to create liquidity for, inter alia, repayment of the various instruments which are issued pursuant to the Group’s offshore debt restructuring schemes. (d) To ensure the stability and sustainable operation of the Group’s business, the Group has consolidated and optimised resources to revitalise the construction and sales of its properties, reducing its operating expenses and make every effort to improve the Group’s liquidity position. Measures undertaken include: (I) The Group will continue to implement measures to accelerate the pre-sales and sales of its properties under development and completed properties, and to speed up the collection of outstanding sales proceeds and other receivables; 5
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(II) The Group has prioritised delivery of property development projects. As at the date of approval of these condensed consolidated financial statements, majority of the Group’s property development projects are progressing according to schedule, and the Group continues to ensure the completion and delivery of its property development projects; (III) The Group will continue to adopt stringent cost control and to actively implement additional measures to further reduce discretionary spending; (IV) The Group will continue to obtain support from its contractors and suppliers in completing its property development projects; and (V) The Group has been proactive in seeking ways to settle the outstanding litigations of the Group. The Directors believed that the Group will reach an amicable solution to address claims and disputes where the outcome is not certain at this stage. After taken into account the above plans and measures, and the Group’s cash flow projections prepared by the management covering a period of not less than twelve months from 30 June 2026, the Directors are of the opinion that the Group will have sufficient working capital to finance its operations and meet its financial obligations as and when they fall due. Accordingly, the Directors considered that it is appropriate to prepare the condensed consolidated financial statements of the Group for the six months ended 30 June 2026 on a going concern basis. Should the Group fail to achieve the intended effects resulting from the plans and measures as mentioned above, adjustments would have to be made to reduce the carrying amounts of the Group’s assets to their realisable amounts, to provide for any further liabilities that may arise, and to reclassify non-current assets and non-current liabilities as current assets and current liabilities, respectively. The effects of all these adjustments have not been reflected in the condensed consolidated financial statements of the Group for the period ended 30 June 2026. 2. PRINCIPAL ACCOUNTING POLICIES The condensed consolidated financial statements have been prepared on the historical cost basis, except for the investment properties and certain financial instruments, which are measured at fair values as appropriate. Other than additional accounting policies resulting from application of amendments to IFRS Accounting Standards and application of certain accounting policies which became relevant to the Group, the accounting policies and methods of computation used in the condensed consolidated financial statements for the six months ended 30 June 2026 are the same as those presented in the Group’s annual consolidated financial statements for the year ended 31 December 2025. 6
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Application of amendments to IFRS Accounting Standards In the current interim period, the Group has applied, for the first time, the following amendments to IFRS Accounting Standards, issued by the IASB which are effective for the Group’s interim period beginning on 1 January 2026: Amendments to IFRS 9 and IFRS 7 Amendments to the Classification and Measurement of Financial Instruments Amendments to IFRS 9 and IFRS 7 Contracts Referencing Nature-dependent Electricity Amendments to IFRS Accounting Standards Annual Improvements to IFRS Accounting Standards – Volume 11 The application of the amendments to IFRS Accounting Standards in the current interim period has had no material impact on the Group’s financial performance and positions for the current and prior periods and/or on the disclosures set out in these condensed consolidated financial statements. New and amendments to IFRS Accounting Standards issued but not yet effective The Group has not early applied the following new standards and amendments to IFRS that have been issued but are not yet effective. The Group intends to adopt these standards, where applicable, when they become effective. The Group is in the process of making an assessment of the impact of these new and amended IFRS Accounting Standards upon initial application. IFRS 18 introduces new requirements for presentation within the statement of profit or loss and other comprehensive income, including specified totals and subtotals. It also requires disclosure of management-defined performance measures and includes new requirements for aggregation and disaggregation of financial information. The new requirements are expected to impact the Group’s presentation in the statement of profit or loss and other comprehensive income and disclosures of the Group’s financial performance. The new standard is not expected to have any impact on the Group’s results of operations and financial position but has impact on the presentation and disclosure of the Group’s financial statements. Other than IFRS 18, so far, the Group considers that IFRS 19 and other amended IFRS Accounting Standards are unlikely to have a significant impact on the Group’s results of operations and financial position. 7
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3. REVENUE Disaggregation of revenue from contracts with customers For the six months ended 30 June 2026 Property development Property investment Others Total RMB’000 RMB’000 RMB’000 RMB’000 Types of goods or services Sales of properties Residential apartments 3,105,124 – – 3,105,124 Commercial apartments 312,481 – – 312,481 Retail shops and others 85,394 – – 85,394 Low-density residential 95,594 – – 95,594 3,598,593 – – 3,598,593 Others – – 59,900 59,900 Revenue from contracts with customers 3,598,593 – 59,900 3,658,493 Property investment Commercial and retail shops – 45,814 – 45,814 Total 3,598,593 45,814 59,900 3,704,307 Timing of revenue recognition At a point of time 3,598,593 – 59,900 3,658,493 Rental income – 45,814 – 45,814 Total 3,598,593 45,814 59,900 3,704,307 8
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For the six months ended 30 June 2025 Property development Property investment Others Total RMB’000 RMB’000 RMB’000 RMB’000 Types of goods or services Sales of properties Residential apartments 3,316,536 – – 3,316,536 Commercial apartments 135,881 – – 135,881 Retail shops and others 242,303 – – 242,303 Low-density residential 134,778 – – 134,778 3,829,498 – – 3,829,498 Others – – 574,760 574,760 Revenue from contracts with customers 3,829,498 – 574,760 4,404,258 Property investment Commercial and retail shops – 61,479 – 61,479 Total 3,829,498 61,479 574,760 4,465,737 Timing of revenue recognition At a point of time 3,829,498 – 574,760 4,404,258 Rental income – 61,479 – 61,479 Total 3,829,498 61,479 574,760 4,465,737 9
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4. SEGMENT INFORMATION The following is an analysis of the Group’s revenue and results by reportable and operating segments: Six months ended 30 June 2026 (unaudited) Property Property development investment Others Total RMB’000 RMB’000 RMB’000 RMB’000 External segment revenue 3,598,593 45,814 59,900 3,704,307 Segment result (2,558,811) (446,489) 8,408 (2,996,892) Other income, gains and losses, net 432,589 Loss on disposal of subsidiaries (930,431) Unallocated corporate expenses (43,196) Share of results of joint ventures (108,209) Share of results of associates (56,945) Finance costs (2,712,935) Loss before tax (6,416,019) Six months ended 30 June 2025 (unaudited) Property Property development investment Others Total RMB’000 RMB’000 RMB’000 RMB’000 External segment revenue 3,829,498 61,479 574,760 4,465,737 Segment result (4,471,167) (575,626) (219,698) (5,266,491) Other income, gains and losses, net 17,239 Loss on disposal of subsidiaries (836,185) Unallocated corporate expenses (42,718) Share of results of joint ventures (102,053) Share of results of associates (146,168) Finance costs (2,850,996) Loss before tax (9,227,372) 10
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5. OTHER INCOME, GAINS AND LOSSES, NET Six months ended 30.6.2026 30.6.2025 RMB’000 RMB’000 (unaudited) (unaudited) Bank interest income (1,615) (4,531) Loss on: – disposal of property, plant and equipment – 16 – disposal of joint ventures – 60,825 – change in fair value of financial assets at FVTPL 61,919 1,233 Exchange gains, net (496,821) (63,110) Impairment loss on: – trade and other receivables 599,125 948,833 – amounts due from joint ventures 168,992 347,296 – amounts due from associates 164,771 – – amounts due from non-controlling shareholders of subsidiaries 1,261 28,023 – property, plant and equipment – 20,790 – goodwill – 17,674 Loss on debt restructuring in specie 147,323 239,915 Others (13,220) (9,248) 631,735 1,587,716 11
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6. INCOME TAX EXPENSES Six months ended 30.6.2026 30.6.2025 RMB’000 RMB’000 (unaudited) (unaudited) Income tax expense/(credit) recognised comprises of: Current tax: PRC EIT 135,310 165,389 LAT 50,714 135,995 186,024 301,384 Deferred tax: PRC (76,679) (48,916) 109,345 252,468 Under the Law of the People’s Republic of China of EIT (the “EIT Law”) and the Implementation Regulation of the EIT Law, the tax rate of the PRC subsidiaries is 25% for both periods, subject to certain preferential income tax policies. Under the Provisional Regulations of the People’s Republic of China on LAT (the “LAT Provisional Regulations”) and Implementation Regulation of the LAT Provisional Regulations, the tax rate of the PRC subsidiaries is levied at progressive rates ranging from 30% to 60% on the appreciation of land value, being the proceeds of sales of properties less deductible expenditures including cost of land use rights and relevant property development expenditures. No provision for Hong Kong Profits Tax has been made in the condensed consolidated financial statements for both periods as there was no assessable profits derived from Hong Kong. Under Canadian tax law, the tax rate used for the period is 26.5% (six months ended 30 June 2025: 26.5%) on taxable profits on Canadian incorporated entities. 12
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7. LOSS FOR THE PERIOD Six months ended 30.6.2026 30.6.2025 RMB’000 RMB’000 (unaudited) (unaudited) Loss for the period has been arrived at after charging/(crediting) the following items: Interest on: Bank and other borrowings 2,294,158 2,409,167 Senior notes and bonds 831,198 1,034,040 Amount due to a joint venture 21,601 21,601 Lease liabilities 52,045 54,673 3,199,002 3,519,481 Less: amounts capitalised to properties under development for sale (486,067) (668,485) 2,712,935 2,850,996 Impairment of properties for sale (included in cost of sales) 1,507,238 3,133,184 Staff costs 56,953 98,910 Depreciation of property, plant and equipment 93,206 139,154 Depreciation of right-of-use assets 17,330 41,971 8. DIVIDENDS The directors of the Company do not recommend or declare any payment of any dividend for the six months ended 30 June 2026 (six months ended 30 June 2025: nil). 13
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9. LOSS PER SHARE The calculation of the basic and diluted loss per share attributable to owners of the Company is based on the following data: Six months ended 30.6.2026 30.6.2025 RMB’000 RMB’000 (unaudited) (unaudited) Loss: Loss for the purpose of basic loss per share (6,270,815) (8,814,418) 30.6.2026 30.6.2025 ’000 ’000 Number of shares: Weighted average number of ordinary shares for the purpose of basic and diluted earnings per share 5,551,290 4,061,944 For the purpose of computation of basic loss per share for the six months ended 30 June 2025 and 2026, the weighted average number of ordinary shares in issue has taken into account ordinary shares issuable upon conversion of mandatorily convertible bonds. Diluted loss per share There are no potential ordinary shares outstanding during the six months ended 30 June 2025 and 2026. Accordingly, diluted loss per share is the same as basic loss per share for both six months ended 30 June 2025 and 2026. 14
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10. TRADE AND OTHER RECEIVABLES 30.6.2026 31.12.2025 RMB’000 RMB’000 (unaudited) (audited) Trade receivables 1,065,030 1,051,530 Less: Allowance for expected credit losses (667,687) (653,226) 397,343 398,304 Rental receivables 126,082 122,791 Other receivables 22,071,313 22,487,265 Security deposits 663,551 663,605 Less: Allowance for expected credit losses (8,479,136) (7,894,725) 14,255,728 15,256,145 Contract costs 243,499 256,035 Advance to constructors and suppliers 900,418 901,559 Prepayment paid for potential purchases of land use rights and property projects 4,234,750 4,233,700 Less: Impairment (987,936) (987,936) 3,246,814 3,245,764 Other tax prepayments 1,792,583 2,137,357 20,962,467 22,317,955 The following is an aging analysis of gross trade receivables, determined based on the date of the properties were delivered and sales were recognised and service were provided: 30.6.2026 31.12.2025 RMB’000 RMB’000 (unaudited) (audited) 0 to 60 days 9,147 17,821 61 to 180 days 86,209 136,472 181 to 365 days 83,001 23,425 1 to 2 years 21,660 27,530 2 to 3 years 189,119 295,859 Over 3 years 675,894 550,423 1,065,030 1,051,530 15
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11. TRADE AND OTHER PAYABLES 30.6.2026 31.12.2025 RMB’000 RMB’000 (unaudited) (audited) Trade and bills payables 16,403,852 16,126,542 Other payables 38,604,961 36,900,703 Consideration payables for acquisition of subsidiaries 1,420,493 1,420,493 Other taxes payables 3,908,228 4,331,093 60,337,534 58,778,831 The following is an aging analysis of trade and bills payables determined based on the invoice date: 30.6.2026 31.12.2025 RMB’000 RMB’000 (unaudited) (audited) 0 to 60 days 192,409 22,271 61 to 180 days 130,085 50,296 181 to 365 days 72,567 123,339 1 to 2 years 112,904 128,201 2 to 3 years 120,880 6,193,014 Over 3 years 15,775,007 9,609,421 16,403,852 16,126,542 16
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MANAGEMENT DISCUSSION AND ANALYSIS BUSINESS REVIEW During the Reporting Period, the Group remained firmly committed to “guaranteeing property delivery” as the central focus of its operational recovery strategy, placing it alongside “onshore debts restructuring” as its primary work streams. In the first half of the year, the Group advanced its onshore debts restructuring in an orderly manner, pushing forward through the dual approach of operational deleveraging and financial restructuring to further optimise its debt structure, thereby creating conditions for the resumption of orderly operations. Meanwhile, the Group continues to strengthen its cost control measures and enhance sales- driven revenue generation capabilities, fostering a bottoming-out and gradual recovery in its operational fundamentals. During the Reporting Period, the Group achieved property contracted sales of approximately RMB864 million with contracted gross floor area (“GFA”) sold of approximately 84,700 sq.m. Details of property contracted sales by region are as follow: Region Property contracted sales amount Contracted GFA sold (RMB million) (’000 sq.m.) South China 254 18.42 Core Region of Central & Western China 202 18.32 East China 87 6.10 Bohai Rim 321 41.86 Total 864 84.70 The Group continues to focus on the core cities in the Greater Bay Area. As at 30 June 2026, the landbank in the Greater Bay Area had a total GFA of approximately 4.84 million sq.m., with the attributable GFA of approximately 3.55 million sq.m. FUTURE OUTLOOK In the second half of 2026, the Group will continue to vigorously advance its onshore and offshore debts restructuring efforts to facilitate the Company’s full transition from the risk resolution phase to a normal course of operations. Against the backdrop of favorable industry policies and the ongoing restoration of market confidence, the Group will seize the window of opportunity presented by the industry’s recovery and focus on three core strategies: (i) improving sales and inventory clearance while accelerating resource integration; (ii) tackling debt restructuring and optimizing capital structure; and (iii) strengthening operational foundations while exploring smart new profit models and solidifying the brand building business, as well as urban renewal business. Through the coordinated implementation of the above three strategies, the Group will steadily return to a normal course of operations, with the fundamental objective of creating greater value for shareholders, investors and the society on a continuous basis, thereby driving the Company to achieve high-quality, sustainable and steady development. 17
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FINANCIAL REVIEW Operating Results The revenue is primarily generated from property development. During the Reporting Period, the Group’s total revenue was approximately RMB3,704 million, representing a decrease of approximately RMB762 million or 17.1% over approximately RMB4,466 million in the same period of 2025. Property development revenue, other revenue such as hotel operation and property investment revenue accounted for 97.1%, 1.7% and 1.2%, respectively. During the Reporting Period, the Group’s revenue generated from sales of properties amounted to approximately RMB3,599 million, representing a decrease of approximately RMB230 million or 6.0% over approximately RMB3,829 million in the same period of 2025. The GFA of delivered properties decreased by 15.7% to 0.43 million sq.m. from 0.51 million sq.m. in the same period of 2025. Gross Profit and Margin During the Reporting Period, the gross loss of the Group was approximately RMB1,444 million, representing a decrease of 49.2% from the gross loss of approximately RMB2,841 million in the same period of 2025. The Group’s gross loss margin was 39.0%. Excluding the impairment loss on properties for sale, included in cost of sales, the Group’s gross profit for the first six months of 2026 amounted to approximately RMB64 million, representing a decrease of 78.1% over that of approximately RMB292 million for the same period in 2025. Other Income, Gains and Losses During the Reporting Period, the Group’s other income, gains and losses mainly included exchange gain of approximately RMB497 million, expected credit loss of approximately RMB934 million, and loss on debt restructuring in specie of approximately RMB147 million and other losses of approximately RMB48 million. Selling and Administrative Expenses During the Reporting Period, total selling and distribution expenses of the Group were approximately RMB46 million, representing a decrease of 71.3% from approximately RMB160 million in the same period of 2025. The decrease was mainly due to a decrease in property contract sales during the Reporting Period, which in turn led to a corresponding reduction in overall sales, marketing, and promotional activities. Total administrative expenses decreased by 48.7% from approximately RMB349 million in the same period of 2025 to approximately RMB179 million, which was mainly attributable to the Group’s continuing effort in the streamlining of organizational structure and effective control over cost and expenses. Loss Attributable to Owners of the Company During the Reporting Period, loss attributable to owners of the Company was approximately RMB6,271 million, representing a decrease of 28.9% from approximately RMB8,814 million in the same period of 2025. 18
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Financial Position As at 30 June 2026, the Group’s total assets amounted to approximately RMB118,125 million (31 December 2025: approximately RMB128,223 million) and total liabilities were approximately RMB170,269 million (31 December 2025: approximately RMB173,868 million). Current ratio (calculated based on the total current assets divided by the total current liabilities) was 0.6 as at 30 June 2026 (31 December 2025: 0.7). Cash Position As at 30 June 2026, the Group had cash and bank deposits of approximately RMB208 million (31 December 2025: approximately RMB184 million). As at 30 June 2026, the Group had restricted bank deposits of approximately RMB1,142 million (31 December 2025: approximately RMB1,410 million) which served as security deposits and mortgage guarantees or subject to judicial freezing and restrictions imposed by creditors. As at 30 June 2026, cash and bank deposits and restricted bank deposits of the Group mentioned above totalled approximately RMB1,350 million, of which 93.0% was denominated in Renminbi and 7.0% was denominated in other currencies (mainly HK dollar and Canadian dollar). Borrowings, Senior Notes and Corporate Bonds As at 30 June 2026, the Group had bank and other borrowings of approximately RMB46,094 million (31 December 2025: approximately RMB47,353 million), senior notes and corporate bonds of approximately RMB24,551 million (31 December 2025: approximately RMB24,174 million). Repayment Period 30 June 2026 31 December 2025 (RMB million) (RMB million) Repayment on demand and within one year 69,748 56,065 More than one year, but not exceeding two years 680 715 More than two years, but not exceeding five years 217 7,122 More than five years – 7,625 70,645 71,527 Part of the borrowings of the Group are floating-rate borrowings, of which interest rates are subject to negotiation on an annual basis, thus exposing the Group to cash flow interest rate risk. The Group has implemented certain interest rate management policies which included, among others, close monitoring of interest rate movements and replacing and entering into new banking facilities when good pricing opportunities arise. 19
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The capital gearing ratio is calculated by dividing the net debt by total capital. Net debt equals to total debt (representing bank and other borrowings, senior notes and bonds) net of total cash (including cash and cash equivalent and restricted bank deposits). Total capital is calculated by adding total equity and net debt. As at 30 June 2026, the Group’s capital gearing ratio was approximately 404.0% (31 December 2025: approximately 287.9%). Contingent Liabilities As at 30 June 2026, the Group had contingent liabilities relating to guarantees in respect of mortgage facilities provided by banks to purchasers and banking facilities granted to certain contractors or business partners, joint ventures and associates of the Group amounting to approximately RMB57,946 million (31 December 2025: approximately RMB59,328 million). The Group provided guarantees in respect of the banks’ mortgage loans granted to certain property purchasers of the Group and agreed to repurchase the properties upon the purchasers’ default on the repayment of the outstanding mortgage loans and the loan interests accrual thereon. The fair value of the financial guarantee contracts is not significant at initial recognition, and no provision has been made as the default rate is low. Commitments As at 30 June 2026, the Group’s construction cost, contracted but not provided for amounted to approximately RMB9,677 million (31 December 2025: approximately RMB11,017 million). In addition, the Group’s share of commitments relating to its joint ventures arising from construction cost commitments contracted but not provided for is approximately RMB2,744 million (31 December 2025: approximately RMB3,027 million). The Group expects to fund these commitments principally from sales proceeds of properties and bank borrowings. Foreign Currency Risks Most of the Group’s revenues and operating costs are denominated in Renminbi. Except for the bank deposits denominated in foreign currencies, senior notes and convertible bonds denominated in US dollar and bank loans denominated in HK dollar, the Group’s operating cash flow or liquidity is not directly subject to any other significant exchange rate fluctuations. The management closely monitors foreign currency exposure and consider hedging significant foreign currency exposure when needed. Pledge of Assets As at 30 June 2026, the Group has pledged its properties for sale, property, plant and equipment, investment properties, right-of-use assets, financial assets at FVTPL and restricted bank deposits amounting to approximately RMB47,530 million (31 December 2025: approximately RMB51,118 million) to various banks to secure project loans and general banking facilities granted to the Group. 20
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EVENTS AFTER REPORTING PERIOD Change of Company Secretary and Authorised Representative Ms. Wong Mei Shan has resigned as both the Company Secretary and an Authorised Representative of the Company with effect from 30 July 2026, and Ms. Chong Mei Lin has been appointed as both the Company Secretary and an Authorised Representative of the Company with effect from the same date. Please refer to the announcement of the Company dated 30 July 2026 for details. Save as disclosed in this interim results announcement, there have been no other significant events that have a material impact on the Group subsequent to the Reporting Period. INTERIM DIVIDEND The Board has resolved not to declare any interim dividend for the Reporting Period (for the six months ended 30 June 2025: Nil). PURCHASE, SALE OR REDEMPTION OF THE COMPANY’S LISTED SECURITIES Neither the Company nor any of its subsidiaries had purchased, sold or redeemed any of the Company’s listed securities during the Reporting Period. CORPORATE GOVERNANCE CODE The Board recognises the importance of maintaining a high standard of corporate governance to protect and enhance the benefits of shareholders and has applied the principles of the code provisions of the Corporate Governance Code (the “CG Code”) contained in Appendix C1 of the Listing Rules. During the Reporting Period, the Company has complied with the code provisions of the CG Code except for the following deviations: In accordance with the Code Provision C.1.5 of CG Code, independent non-executive directors and other non-executive directors shall generally attend the general meetings. One non-executive Director was unable to attend annual general meeting of the Company held on 26 June 2026 (the “2026 AGM”) due to other important engagement. In accordance with Code Provision F.1.3 of CG code, the chairman of the board of directors is expected to attend the annual general meeting and respond to relevant questions raised by shareholders. However, Mr. Mohamed Obaid Ghulam Badakkan Alobeidli, chairman of the Board, was unable to attend the 2026 AGM due to unavoidable scheduling conflicts arising from other pressing business commitments. The Board of directors acknowledges the importance of his presence at the annual general meeting and regrets his absence. To ensure shareholders’ questions were adequately addressed, other members of the Board of directors and senior management were present to respond on his behalf. 21
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MODEL CODE FOR SECURITIES TRANSACTIONS BY DIRECTORS The Company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers (the “Model Code”) contained in Appendix C3 of the Listing Rules as its own code of conduct regarding directors’ securities transactions. Having made specific enquiry of all the directors of the Company, all the directors have confirmed that they have complied with the required standard of dealings set out in the Model Code throughout the six months ended 30 June 2026. EMPLOYMENT AND REMUNERATION POLICY As of 30 June 2026, the Group had about 522 employees (31 December 2025: 571). The Group regularly reviews remuneration and benefits of its employees according to the relevant market practice and individual performance of the employees. Pursuant to relevant laws and regulations, the Group provides contributions to social insurance of China and contribution to the Mandatory Provident Fund Scheme of Hong Kong for eligible employees. The Group also provides employees in China with medical insurance, individual work injury insurance, maternity insurance and unemployment insurance. AUDIT COMMITTEE The audit committee of the Company, comprising Mr. Cheung Kwok Keung as chairman, Mr. Lee Thomas Kang Bor and Mr. Wong Wai Keung Frederick as members, has reviewed, together with the participation of the management, the accounting principles and practices adopted by the Group and discussed accounting and financial reporting matters including the review of the unaudited consolidated interim financial statements of the Group for the six months ended 30 June 2026. PUBLICATION OF INTERIM RESULTS AND INTERIM REPORT This interim results announcement is published on the websites of the Stock Exchange (http://www.hkexnews.hk) and the Company (http://www.aoyuan.com.cn). The interim report of the Company for the six months ended 30 June 2026 containing all the information required by the Listing Rules will be despatched to the Company’s shareholders and available on the above websites in due course. By order of the Board China Aoyuan Group Limited Cheng Siu Fai Executive Director Hong Kong, 28 August 2026 As at the date of this announcement, the Executive Directors of the Company are Mr. Cheng Siu Fai, Mr. Jiang Zhan Hong and Ms. Shi Lili; the Non-executive Directors of the Company are Mr. Mohamed Obaid Ghulam Badakkan Alobeidli and Mr. Guo Zi Wen; and the Independent Non-executive Directors of the Company are Mr. Cheung Kwok Keung, Mr. Lee Thomas Kang Bor and Mr. Wong Wai Keung Frederick. 22