Hong Kong IPO disclosure precedents · 34 companies, 34 items
Impairment testing or impairment charges on intangible assets such as patents, licenses, software, deferred development costs and non-patented technology, including impairments caused by unsuccessful clinical trials or R&D outcomes and impairment indicators from continued losses.
During the year ended December 31, 2024, our management made the decision to discontinue production of certain product models due to accelerated product upgrades. Impairment amounting to RMB1,054.1 million is recognized to the non-patented technology related to these product models as the management are of the opinion that the value in use of the related technology is neglectable.
Financial Information · p. 321
We have recognized impairment losses amounting to nil, RMB76.2 million and RMB572.6 million for the years ended December 31, 2022, 2023 and 2024, respectively, based on the impairment assessment performed.
Financial Information · p. 322
During the year ended December 31, 2024, the financial performance of Luzhou Rongda did not meet the expectation set by our management. Our management had consequently determined impairment of goodwill directly related to Luzhou Rongda amounting to RMB46.9 million.
As of December 31, 2022, 2023, and 2024, and June 30, 2025, the carrying amounts of these deferred development costs not yet available for use were RMB256.6 million, RMB286.5 million, and RMB133.1 million, and RMB143.1 million, respectively.
Financial Information · p. 348
The recoverable amounts of each intangible asset not yet available for use based on the estimated value-in-use calculations was higher than the respective carrying amount as of December 31, 2022, 2023 and 2024, and June 30, 2025.
Financial Information · p. 348
We have performed a sensitivity test by decreasing 5% of expected revenue or increasing 1% of discount rate, with all other key assumptions held constant, the recoverable amount of the intangible assets not yet available for use would have exceeded their carrying amount.
Our intangible assets increased by 14.4% from RMB533.8 million as of December 31, 2023 to RMB610.6 million as of December 31, 2024 and further increased by 3.1% to RMB629.6 million as of June 30, 2025, primarily driven by an increase of research and development costs over the periods as we continued to invest in R&D activities to optimize our diversified and balanced pipeline of drug assets.
Financial Information · p. 459
Therefore, recoverable amounts exceed the carrying amounts with headroom of RMB789.9 million, RMB480.6 million and RMB606.6 million, respectively.
Financial Information · p. 460
The 1% decrease in the revenue growth rate or 1% increase in the pre-tax discount rate would not cause the carrying amount of each project to exceed its recoverable amount at the end of each period of the Track Record Period.
Impairment review on the deferred development costs of the Group is conducted by the management of the Group by engaging an independent qualified professional valuer, Jiangsu Zhongqihua Zhongtian Asset Appraisal Co., Ltd. (“Appraisal Expert”), to estimate the recoverable amount of the CGUs at the end of each year.
Financial Information · p. 410
For the years ended 31 December 2022, 2023 and 2024 and 31 March 2025, the management considered no reasonably possible change in the key assumptions mentioned above would cause the carrying amounts of the CGUs to exceed their recoverable amounts.
Financial Information · p. 414
The management determined that there was no impairment of its CGUs as of 31 December 2022, 2023 and 2024 and 31 March 2025.
Our capitalized development costs included in intangible assets that were not yet available for use and not subject to amortization were RMB1,681.0 million, RMB2,492.5 million, and RMB3,837.6 million as of December 31, 2022, 2023 and 2024, respectively.
Financial Information · p. 384
Based on the result of annual impairment test, the recoverable amount of capitalized development costs would have exceeded their carrying amount (headroom) by more than 200% as of December 31, 2022, 2023 and 2024.
Financial Information · p. 384
Should the discount rate increase by 1% or expected revenue decrease by 10%, the headroom would have decreased by no more than 20% as of December 31, 2022, 2023 and 2024.
The decrease was primarily because (i) we suspended the development of a drug candidate and accordingly recorded a full allowance for the impairment of the in-licensed antibody used in its development, and (ii) certain amounts were recognized as cost of revenue in accordance with our out-licensing arrangements.
Financial Information · p. 456
The impairment test was performed for each pipeline product by engaging an independent appraiser to estimate fair value less cost to sell as the recoverable amount of each pipeline product.
Financial Information · p. 457
Based on the result of the assessment, there was no impairment for the in-licenses and in-progress research and development as of December 31, 2023.
For the purposes of the impairment review, the recoverable amount of our internally generated intangible assets which are not yet ready for use is determined based on value-in-use (“VIU”) calculated by discounted cash flow model.
Financial Information · p. 450
As at 31 December 2022 and 2023, the estimated recoverable amount based on the VIU calculation were approximately RMB9.7 million and RMB23.4 million, respectively, which are higher than the carrying amount of our internally generated intangible assets which are not yet ready for use.
Financial Information · p. 451
As at 31 December 2023, had there been a decrease in the cash flow forecast by 5%, or an increase in the pre-tax discount rate by 5 percentage points each in isolation, the headroom would be have been decreased to approximately RMB10.9 million and RMB11.2 million, respectively.
Our intangible assets mainly represented software, patents and license, trademark, and deferred development costs. We performed annual impairment testing during the Track Record Period for deferred development costs which were not yet available for use.
Financial Information · p. 526
We performed the sensitivity analysis based on the assumption that annual revenue growth rates, pre-tax discount rates and royalty rates have been changed.
Financial Information · p. 529
We believe that no reasonably possible change in the key assumptions mentioned above would cause the carrying amounts of the CGU to exceed their recoverable amounts as of December 31, 2021, 2022 and 2023 and as of June 30, 2024. We believe that there was no impairment of the CGU as of December 31, 2021, 2022 and 2023 and as of June 30, 2024.
Our intangible asset remained stable at RMB10.0 million as of 2022 and 2023, as we will not recognize any amortization or impairment loss of this intangible asset prior to the commercialization of IBC0966.
Financial Information · p. 436
Based on the result of the IPR&D impairment testing, the recoverable amount of the cash-generating unit exceeded its carrying amount as of December 31, 2022 and 2023.
Financial Information · p. 452
If the pre-tax discount rate used as of December 31, 2022 and 2023 was changed to 27.4% and 25.6%, respectively, while other parameters remain constant, the recoverable amount of the cash-generating unit would equal its carrying amount.
With the expected decline in the sales of the 9SSL fuel cell stacks, we performed an impairment assessment, and an impairment loss of RMB57.4 million was subsequently provided to the 9SSL fuel cell stacks license for the year ended 31 December 2020.
Summary · p. 6
The recoverable amount of the 9SSL fuel cell stacks license was assessed by our management based on fair value less cost of disposal, and we made a provision for the impairment of RMB57,358,000 and charged to the cost of sales.
Financial Information · p. 404
The following sensitivity analysis illustrates the impact of hypothetical fluctuations of our profit before income tax in relation to the changes of net royalty rate and discount rate in 2020, assuming all other variables remained constant.
These calculations use pre-tax free cash flow of finance lease business projections based on profit forecast approved by management covering a five-year period and a pre-tax discount rate of 15.1%, which reflects the specific risks relating to the finance lease business in the PRC.
Financial Information · p. 403
As at 31 December 2020, 2021 and 2022, our management assessed the recoverable amount of the cash generated unit (CGU) and determined that no impairment loss was recognised for the capitalised development costs as the recoverable amounts exceeded the carrying amounts.
Financial Information · p. 403
Our Directors have not identified any reasonably possible change in the key assumptions on which the recoverable amount is based that would cause the carrying amounts of the CGU to exceed their respective recoverable amounts as at 31 December 2020, 2021 and 2022, respectively.
As at 31 December 2020, 2021 and 2022, our intangible assets included (i) goodwill in relation to Taiyuan Renewable Energy; (ii) operating concessions; and (iii) software, amounting to RMB3,169.9 million, RMB3,190.7 million and RMB3,341.0 million, respectively.
Financial Information · p. 515
For the year ended 31 December 2022, an impairment loss of approximately RMB9.4 million was recognised, primarily attributable to the decrease in the expected net profit margin of Shuozhou Renewable Energy for the remaining service concession periods of the Shuozhou Project according to the most recent financial forecasts prepared by our management.
Financial Information · p. 518
Based on the result of the goodwill impairment test performed by our Directors, the estimated recoverable amount exceeded the carrying amount by approximately RMB130.7 million, RMB142.5 million and RMB149.3 million as at 31 December 2020, 2021 and 2022, respectively.
Intangible assets consist of (i) our in-licensed rights in relation to LAE001, LAE002, LAE003 and LAE005, and (ii) the clinical data analysis software we purchased in 2021 and the molecular operating environment software and a series of software for clinical development we purchased in 2022.
Financial Information · p. 402
We tested intangible assets not yet ready for commercial use annually, based on the recoverable amount of the cash-generating unit (“CGU”) to which the intangible asset is related.
Financial Information · p. 402
Based on the result of the above assessment, there were no impairment for the intangible assets as of December 31, 2021 and 2022.