Clifford Modern Living Holdings Limited Announces Major Transaction: Disposals of Unallocated Silver Bullion Investments

Date: 25 February 2026
Ticker: 3686.HK

Key Highlights

• Major Transaction: Clifford Modern Living Holdings Limited (“Clifford Modern Living” or “the Company”) has completed the disposal of its entire holdings in unallocated silver bullion, amounting to 680,000 ounces, in two tranches during January 2026.
• Aggregate Consideration: The total net proceeds from these disposals reached approximately RMB387.9 million.
• Significant Gains: The Company expects to recognize an unaudited profit of approximately RMB43.8 million from these disposals in FY2026, based on preliminary carrying values. Actual gains may be subject to auditor review.
• Strategic Treasury Shift: A substantial portion of the proceeds (about RMB180 million) is earmarked for new long-term investments in precious metals, primarily gold and allocated silver, marking a strategic shift in treasury management policy.
• Dividend Policy Update: Approximately RMB85.7 million (22.1% of proceeds) will be used for the payment of a final cash dividend for FY2025, with the Board considering a revision of the dividend policy in light of exceptional one-off gains.
• Shareholder Approval: The transaction was approved by written consent from controlling shareholders (holding 72.89% of the issued capital), negating the need for a general meeting.

Detailed Transaction Overview

Background and Rationale

Since 2020, Clifford Modern Living has invested in unallocated silver bullion as part of its treasury management strategy. The investments were made to preserve capital and hedge against market uncertainties. By the end of 2024, the Company held 680,000 ounces of unallocated silver bullion, valued at approximately RMB141.3 million.

Disposal Details

• Jan 9 Disposal: 400,000 ounces sold on 9 January 2026 for RMB226.2 million. Expected unaudited profit: RMB23.8 million.
• Jan 12 Disposal: 280,000 ounces sold on 14 January 2026 for RMB161.7 million. Expected unaudited profit: RMB20.0 million.
• Rationale: The Company capitalized on a dramatic surge in silver prices, with the average LBMA silver price per ounce rising to US\$77.7 in early 2026, up over 80% from 2025’s average of US\$41.2 per ounce. The Board deemed this an optimal opportunity to realize gains for shareholders.

Use of Proceeds

Notably, as of the latest practicable date, all RMB180 million allocated for precious metals investment has been fully utilized, with purchases of 2,730 ounces of unallocated gold bullion and 150,000 ounces of allocated silver bullion.

Treasury and Investment Policy Update

• The Company is shifting its surplus cash deployment strategy towards precious metals as a defensive, prudent capital management approach, citing macroeconomic and geopolitical uncertainties.
• Previously, treasury management focused on liquidity and term deposits, but precious metals are now viewed as a better store of value and a risk diversifier, particularly during economic downturns.
• Future investment in precious metals will be capped at RMB400 million (including proceeds and internal resources), with regular Board oversight and strict internal controls.

Dividend Policy and FY2025 Final Dividend

• Dividend policy mandates a payout of no less than 50% of audited consolidated profit attributable to shareholders in any financial year.
• The FY2025 final dividend will also factor in at least 20% of the one-off fair value gain from the silver investment, in addition to operating profit. Estimated dividend payout: RMB85.7 million.
• The Board may revise the dividend policy due to the exceptional and non-recurring nature of the silver disposal gain.
• Dividend payment remains subject to Board recommendation, audit committee review, and shareholder approval at the upcoming AGM.

Financial Effects and Shareholder Impact

• Liquidity Boost: The disposals have significantly increased the Company’s liquidity, raising the cash and short-term investments from RMB228.4 million to RMB616.3 million immediately after completion, with the cash to total assets ratio jumping from 35.1% to 88.7%.
• No Change in Liabilities: The transaction does not affect the Group’s liabilities, and the Company will not become a “cash company” under the Listing Rules after planned utilization of proceeds, as the cash to assets ratio will normalize to 53.8% post-investment and payouts.
• No Change in Control: The transaction does not involve any new investors or change in shareholding structure.

Regulatory and Governance Matters

• The disposals are classified as a major transaction under the Listing Rules, but no physical shareholders’ meeting was required due to written approval from controlling shareholders.
• All relevant internal controls and compliance measures were followed, with full Board oversight on treasury and investment decisions.

Potential Share Price Impact & Price Sensitive Information

• The significant profits realized from the silver disposals (RMB43.8 million), the sharp increase in liquidity, and the Board’s commitment to a substantial dividend payout for FY2025 are all highly price-sensitive and positive for shareholder value.
• The Company’s clear shift in treasury management towards precious metals—amid global uncertainty—signals a defensive, yet potentially accretive use of capital, which may further support or enhance share price stability.
• Investors should closely monitor future announcements regarding further investments, dividend declarations, and any changes to the Company’s treasury or dividend policy, as these could materially affect share valuation.

Other Notable Points for Investors

• The Company maintains a diversified service portfolio (property management, retail, off-campus training, IT, and ancillary services) and remains committed to operational optimization and prudent risk management in the face of ongoing market challenges.
• No material adverse changes, litigation, or new material contracts outside the ordinary course of business have been reported since the last audited financial statements.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. Investors should refer to official company announcements and audited results before making investment decisions. The information herein is based on the latest available disclosures as of 25 February 2026 and may be subject to update or revision.

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