Annual Report 2024

NOTESTOTHE CONSOLIDATED FINANCIAL STATEMENTS For the year ended 31 December 2024 124 The United Laboratories International Holdings Limited Annual Report 2024 34. GOVERNMENT GRANTS Government grants comprise: (i) Incentive subsidies of RMB173,716,000 (2023: RMB68,232,000) have been received in the current year to encourage the operations of certain PRC subsidiaries for the development of environmental friendly manufacturing, pollution prevention, development on export sales and advanced technology. Full amounts are recognised as income in profit or loss as there were no specific conditions attached to the grants and, therefore, the Group recognised the grants to profit or loss upon receipt. The subsidies were granted on a discretionary basis to the Group during the current year. (ii) During the year ended 31 December 2024, the Group did not recognised government grants (2023: RMB529,000) in respect of Covid-19-related subsidies and the Group recognised RMB1,024,000 (2023: RMB1,455,000) in respect of Employment Support Scheme provided by the Hong Kong government. (iii) Certain subsidies relate to the development of pharmaceutical products or improvement of production efficiency amounting of RMB36,494,000 (2023: RMB41,348,000) at 31 December 2024 are included as deferred income. The amounts are recognised as income when the Group has fulfilled the relevant conditions attaching to the grants, including but not limited to obtaining the medical licenses of the pharmaceutical products or the starting of commercial sales of the pharmaceutical products. During the current year, the Group has recognised the government grant of approximately RMB4,854,000 (2023: RMB11,098,000) as income in profit or loss. (iv) Government subsidies granted for the acquisition of property, plant and equipment by the Group brought forward from prior year had been treated as deferred income and was transferred to income over the useful lives of the relevant assets. At 31 December 2024, an amount of RMB22,205,000 (2023: RMB32,237,000) were included in non-current liabilities. During the year ended 31 December 2024, RMB10,032,000 (2023: RMB11,176,000) was released to the profit or loss. The aggregate subsidy income recognised to the profit or loss during the year ended 31 December 2024 amounted to RMB189,626,000 (2023: RMB92,490,000) (Note 6).