Group 1 - The core viewpoint of the report is that China Ruyi (00136) is expected to maintain a "buy" rating, with projected revenues of 4.84 billion and 5.89 billion yuan for 2025 and 2026 respectively, reflecting year-on-year growth rates of 32% and 22% [1] - The company reported a significant turnaround in its financial performance for the first half of 2025, achieving operating revenue of 2.206 billion yuan, a year-on-year increase of 19.93%, and net profit of 1.228 billion yuan, compared to a loss of 123 million yuan in the same period last year [1] - The revenue breakdown for 2025 shows substantial growth in content production and online streaming services, with revenues of 570 million and 406 million yuan respectively, reflecting year-on-year changes of 1085% and -55% [1] Group 2 - The company is focusing on core sectors and enhancing industrial synergy and value release, including a strategic investment in Wanda Film to integrate the entire industry chain from content creation to terminal screening [2] - The company made a forward-looking investment in Beijing Lezi Tiancheng Cultural Development Co., Ltd. to tap into the high-growth market of trendy toys and collectibles, further deepening the IP value chain [2] - In July 2025, the company initiated a 30% equity acquisition of Kuaiqian Financial Services (Shanghai) Co., Ltd., aiming to build a "culture + technology + finance" closed-loop in the digital content ecosystem [2]

[Company Information](index=3&type=section&id=Company%20Information) [Board of Directors and Committees](index=3&type=section&id=Board%20of%20Directors%20and%20Committees) The company's board comprises executive, non-executive, and independent non-executive directors, with audit, remuneration, and nomination committees ensuring sound corporate governance - Board members include Mr. Ke Liming (Chairman), Mr. Zhang Qiang (Executive Director), Mr. Yang Ming (Non-executive Director), and Mr. Zhou Chengyan, Mr. Nie Zhixin, Mr. Chen Haiquan, Professor Shi Zhuomin (Independent Non-executive Directors)[5](index=5&type=chunk) - Mr. Zhou Chengyan chairs both the Audit Committee and Remuneration Committee, while Mr. Ke Liming chairs the Nomination Committee[5](index=5&type=chunk) [Registration and Operational Information](index=3&type=section&id=Registration%20and%20Operational%20Information) The company is incorporated in Bermuda, with primary operations in Hong Kong and mainland China, and PwC serves as its auditor - The company's registered office is in Bermuda, its principal place of business in Hong Kong is in Lee Garden One, Causeway Bay, and its principal place of business in China is in Laijin Cultural and Creative Industrial Park, Chaoyang District, Beijing[5](index=5&type=chunk) - Share registrars are located in Bermuda and Tricor Investor Services Limited in Hong Kong[5](index=5&type=chunk) - The auditor is PricewaterhouseCoopers, with the report date being August 25, 2025[6](index=6&type=chunk) [Management Discussion and Analysis](index=4&type=section&id=Management%20Discussion%20and%20Analysis) [Financial Performance Summary, Business Review and Outlook](index=4&type=section&id=Financial%20Performance%20Summary%2C%20Business%20Review%20and%20Outlook) The Group achieved a significant financial turnaround in H1 2025, moving from a loss to profit year-on-year, with substantial growth in turnover and adjusted net profit, driven by robust core business growth and synergistic industry layout 2025 H1 vs 2024 H1 Financial Performance Comparison | Indicator | 2025 H1 (RMB) | 2024 H1 (RMB) | YoY Change | | :--- | :--- | :--- | :--- | | Profit/(Loss) attributable to equity holders of the Company | 1.235 billion (Profit) | (115 million) (Loss) | Turned loss into profit | | Basic and diluted earnings/(loss) per share | 8.14 cents / 8.12 cents | (0.98 cents) / (0.98 cents) | Turned loss into profit | | Turnover | 2.206 billion | 1.840 billion | +20% | | Revenue from content production, online streaming, and online gaming businesses | 2.186 billion | - | - | | Adjusted net profit | 1.303 billion | 544 million | +140% | | Net profit/(loss) | 1.228 billion (Net profit) | (123 million) (Net loss) | Turned loss into profit | - The Group's overall operating performance was strong, with profitability entering a substantive improvement phase, and significant achievements in cost control, resource utilization efficiency, and optimization of profit structure[9](index=9&type=chunk) [Content Production Business](index=5&type=section&id=Content%20Production%20Business) The Group's content production business performed strongly in H1 2025, with a steady recovery in the film market, multiple films achieving excellent box office and awards, and the TV drama business continuously strengthening production capabilities and expanding diversified themes, laying a foundation for future development - The company adheres to a high-quality content development strategy, with the number of films co-produced and distributed, and box office performance, consistently ranking among the industry leaders[10](index=10&type=chunk) - Significant achievements in the drama series sector, with multiple series launched or completed post-production, expected to be released in Q4 2025[12](index=12&type=chunk) [Film Investment, Production and Distribution Business](index=5&type=section&id=Film%20Investment%2C%20Production%20and%20Distribution%20Business) In H1 2025, China's film market box office grew by 22.91% year-on-year; the Group's controlled productions "Sheep Without a Shepherd 3" and "Lie to Love" topped the New Year's Day box office, "Detective Chinatown 1900" ranked second in the Spring Festival, and several films performed strongly in the summer, with a rich pipeline of projects 2025 H1 Film Market Performance | Indicator | Amount/Quantity | YoY Growth | | :--- | :--- | :--- | | National film market box office | RMB 29.231 billion | +22.91% | | Number of moviegoers | 641 million | +16.89% | - The suspense crime film "Sheep Without a Shepherd 3" and the romantic comedy "Lie to Love," both controlled productions, were shortlisted for the "2024 Weibo Netizen's Most Anticipated Films" list, securing the top and third spots in the New Year's Day box office respectively[10](index=10&type=chunk) - "Detective Chinatown 1900," a co-produced film, ranked second in the Spring Festival box office with over **RMB 3.6 billion**, and won multiple awards[10](index=10&type=chunk) - Summer blockbuster "Nanjing Photo Studio" topped the box office, while oriental fantasy IP adaptation "Strange Stories from a Chinese Studio: Lanruo Temple" and historical suspense IP adaptation "Lychees in Chang'an" received annual attention and acclaim[11](index=11&type=chunk) - Upcoming projects include the romantic fantasy film "A Cloud Like You," sci-fi film "We Live in Nanjing," and major projects like "Wilderness Forbidden Zone" and "Cold War 1994"[11](index=11&type=chunk) [TV Drama Investment, Production and Distribution Business](index=6&type=section&id=TV%20Drama%20Investment%2C%20Production%20and%20Distribution%20Business) The company continues to strengthen its full-process drama production capabilities, with the crime IP sequel "Trident 2" and the romantic wuxia costume drama "With Jin Chang'an" launched in H1. Multiple controlled suspense, legal, and urban romance dramas are expected to be released in Q4 2025, with ancient fantasy, new wuxia, and urban inspirational dramas currently in production - The crime IP sequel "Trident 2" was broadcast in H1, receiving enthusiastic market response; the romantic wuxia costume drama "With Jin Chang'an," adapted from an original novel, has been launched[12](index=12&type=chunk) - Controlled productions such as "Night Confession," "Prosecutor and the Youth," and "Unfamiliar Encounters" have completed post-production and are expected to be released in Q4 2025[12](index=12&type=chunk) - Ancient fantasy drama "The Strongest Sect in All Ages" and new wuxia drama "A Bit of Righteousness" have finished filming, while urban inspirational drama "Dazzling" is currently in production[12](index=12&type=chunk) - Future plans adhere to the philosophy of "upholding integrity, pursuing greatness, innovating more, and producing masterpieces," deepening the diversified layout in the drama sector[13](index=13&type=chunk) [Streaming Business](index=6&type=section&id=Streaming%20Business) Pumpkin Films, as the Group's core streaming platform, deeply iterates with AI technology to achieve personalized content recommendations and intelligent interactive services, empowers content production with AI, and significantly enhances user reach and paid subscriber base through a multi-channel promotion matrix - Pumpkin Films, as an online streaming long-form video platform, leverages technology to empower content distribution, provides highly personalized content services through intelligent recommendation algorithms, and introduces high-quality films and top new dramas, deeply exploring the commercial value of copyrights[14](index=14&type=chunk) - The company highly recognizes the application potential of AI technology in the film and television industry and continues to invest and generate returns[16](index=16&type=chunk) - The company actively expands its new media promotion matrix, with collaborating influencers cumulatively covering over **250 million users**, enhancing user conversion and retention rates through short-video dissemination of long-form content[17](index=17&type=chunk) [Upgrading Intelligent Interactive Scenarios, Strengthening User Demand Responsiveness](index=6&type=section&id=Upgrading%20Intelligent%20Interactive%20Scenarios%2C%20Strengthening%20User%20Demand%20Responsiveness) The platform has completed a deep iteration of its AI large model technology, achieving "thousand-person, thousand-face" precise content recommendations, real-time AI interactive services, and dynamic optimization of recommendation logic, while adding multi-dialect seamless switching dialogue services, with the AI intelligent recommendation officer now in testing - AI large model technology enables multi-dimensional user profiling, providing "thousand-person, thousand-face" precise content recommendations[15](index=15&type=chunk) - Integrated real-time AI interactive services support users in obtaining content interpretations, viewing suggestions, and other personalized services through natural language[15](index=15&type=chunk) - New dialogue service can automatically switch seamlessly between Mandarin, Cantonese, and Sichuanese, with more dialects to be added in the future[15](index=15&type=chunk) [AI Technology Empowering Content Production Innovation, Expanding Creative Boundaries](index=7&type=section&id=AI%20Technology%20Empowering%20Content%20Production%20Innovation%2C%20Expanding%20Creative%20Boundaries) The Dream Shapers platform, through continuous R&D and optimization, comprehensively enhances content production and operational efficiency with AI models, performing well in script creation and providing creative ideas, and already possesses capabilities such as "video narration" and "video key content identification," with AI-generated video narration clips to be released in H2 - Dream Shapers platform comprehensively enhances content production and operational efficiency through AI models, performing well in script creation and providing inspiration and creative ideas for screenwriters[16](index=16&type=chunk) - The platform already possesses capabilities such as "video narration" and "video key content identification," with AI-generated video narration clips to be released in H2[16](index=16&type=chunk) [Multi-channel Collaborative Traffic Generation, Significantly Enhancing User Reach](index=7&type=section&id=Multi-channel%20Collaborative%20Traffic%20Generation%2C%20Significantly%20Enhancing%20User%20Reach) The company actively expands its new media promotion matrix, successfully building an industry-leading cluster of film and television content accounts, with collaborating influencers cumulatively covering over 250 million users, effectively improving user conversion and retention rates through short-video dissemination of long-form content, contributing to the growth of paid subscriber base - Continuously expanding new media platform collaborations, successfully building an industry-leading cluster of film and television content accounts, cumulatively covering over **250 million users**[17](index=17&type=chunk) - By transforming long-form video content into short videos for cross-platform dissemination, the company gains copyright licensing revenue and promotes long-form content to reach more users, enhancing user conversion and retention rates[17](index=17&type=chunk) [Gaming Business](index=7&type=section&id=Gaming%20Business) The Group's gaming business brand "JING XIU" achieved revenue of **RMB 1.21 billion** in H1 2025, a **40% year-on-year increase**. The company focuses on refined R&D and operations, with new products performing outstandingly, and builds a global IP ecosystem and diversified product matrix through film-game linkage, IP commercialization, and AI technology empowerment 2025 H1 Gaming Business Revenue | Indicator | Amount (RMB) | YoY Growth | | :--- | :--- | :--- | | JING XIU Revenue | 1.21 billion | +40% | - The company consistently focuses on high-quality game R&D and operations, meticulously crafting product core, driving content iteration with innovation, and extending product life cycles through a rich gaming ecosystem[19](index=19&type=chunk) - The Group highly values the core driving role of AI technology in its gaming business, continuously investing and deepening its application across the entire game R&D and operation process[22](index=22&type=chunk) [Deepening Refined R&D and Operations, Activating Growth Momentum with Innovative Products](index=7&type=section&id=Deepening%20Refined%20R%26D%20and%20Operations%2C%20Activating%20Growth%20Momentum%20with%20Innovative%20Products) Classic titles like "Ragnarok: Love at First Sight," "World Genesis," and "Haikyuu!!: New Journey" maintain stable revenue, with "Red Alert Online" accumulating over **RMB 6 billion** in total revenue. Newly launched "Star Era" entered the iOS bestseller top ten, with first-month revenue exceeding **RMB 100 million**, and won the sci-fi game champion; "Dragon Stone War" collaborated with Universal Pictures to integrate "How to Train Your Dragon" IP - "Red Alert Online" has accumulated over **RMB 6 billion** in total revenue since its launch, demonstrating the effectiveness of the evergreen product strategy[19](index=19&type=chunk) - Newly launched product "Star Era" performed outstandingly, entering the iOS bestseller top ten and exceeding **RMB 100 million** in first-month revenue, also winning the "Sci-fi Game Champion" award[19](index=19&type=chunk) - "Dragon Stone War" entered a strategic partnership with Universal Products & Experiences to deeply integrate the iconic character "Toothless" from "How to Train Your Dragon" into the game[19](index=19&type=chunk) [Continuously Deepening Film-Game Linkage, Collaborating with Beijing Yonghang to Create a New Growth Pole for Female-Oriented Content](index=8&type=section&id=Continuously%20Deepening%20Film-Game%20Linkage%2C%20Collaborating%20with%20Beijing%20Yonghang%20to%20Create%20a%20New%20Growth%20Pole%20for%20Female-Oriented%20Content) The company has reached a deep cooperation with Beijing Yonghang on the "QQ Dance" series, focusing on female-oriented interactive film-game development. It plans to integrate "QQ Dance" IP resources with the Group's film and television artists and copyright resources to create film-game products combining music-dance social interaction with immersive narrative, and extend the short drama content matrix, achieving monetization through diversified models - Reached deep cooperation with Beijing Yonghang on the "QQ Dance" series, jointly focusing on female-oriented interactive film-game development[20](index=20&type=chunk) - Plans to integrate "QQ Dance" IP resources (virtual idol Starry, etc.) with the Group's film and television artists and copyright resources to create film-game products combining music-dance social interaction with immersive narrative, simultaneously extending the short drama content matrix[20](index=20&type=chunk) - This cooperation plans to achieve monetization through diversified models such as film-game sales, DLC, and commercial placements, building a synergistic ecosystem of "film-game + short drama + game"[20](index=20&type=chunk) [Strengthening IP Commercialization Operations, Actively Expanding Diversified Tracks to Perfect Product Matrix](index=8&type=section&id=Strengthening%20IP%20Commercialization%20Operations%2C%20Actively%20Expanding%20Diversified%20Tracks%20to%20Perfect%20Product%20Matrix) The Group continues to consolidate its advantages in the core SLG track, with the new Three Kingdoms real-time war mobile game "Yan Wu" launching soon. Simultaneously, it actively expands into sports, MMORPG, music-dance, and other diverse fields, reaching deep cooperation with NBA, expected to launch "Code: NBAGO" in 2026, and collaborating with Ubisoft, EA, and China Literature Group to develop multiple classic IP adaptation games - In the core SLG track, the new Three Kingdoms real-time war mobile game "Yan Wu" is launching soon[21](index=21&type=chunk) - Reached deep cooperation with NBA on action-oriented basketball products, simulation management basketball products, and authorized derivatives, expected to launch the game "Code: NBAGO" in 2026[21](index=21&type=chunk) - Collaborated with international leading developers like Ubisoft and EA to obtain domestic development and distribution rights for classic IPs such as "Heroes of Might and Magic" and "Command & Conquer"[21](index=21&type=chunk) - Collaborated with China Literature Group to launch a game adaptation of "Da Feng Da Geng Ren," with multiple major projects in progress[21](index=21&type=chunk) [AI Technology Empowerment, Driving Dual Upgrades in R&D Efficiency and Product Experience](index=8&type=section&id=AI%20Technology%20Empowerment%2C%20Driving%20Dual%20Upgrades%20in%20R%26D%20Efficiency%20and%20Product%20Experience) The Group deepens the application of AI technology across the entire game R&D and operation process, efficiently converting 2D sports footage into 3D game actions through computer vision and motion transfer algorithms, improving action modeling efficiency for sports games by approximately **70%**. The intelligent strategy engine based on reinforcement learning algorithms and the AI commentary system supported by NLP emotional computing models significantly enhance user strategic participation depth and match immersion - Applying computer vision technology and motion transfer algorithms to achieve efficient and precise conversion of 2D real sports footage into dynamic actions for 3D game characters, improving core action modeling efficiency for sports games by approximately **70%**[22](index=22&type=chunk) - The intelligent strategy engine built on reinforcement learning algorithms achieves personalized and dynamic adaptation of tactical recommendations, enhancing user strategic participation depth and stickiness[22](index=22&type=chunk) - The in-game AI commentary system's context restoration and emotional matching for commentary content have reached **98%**, enhancing user immersion in matches[22](index=22&type=chunk) [Investments and Acquisitions](index=9&type=section&id=Investments%20and%20Acquisitions) The Group, through strategic investments in Wanda Film, 52TOYS, and 99bill, deepens full industry chain synergy, expands IP derivative business, and strengthens its "Culture + Technology + Finance" strategic layout, aiming to enhance monetization efficiency, expand revenue sources, and strengthen platform operational capabilities - The company invested in Wanda Film in 2023, achieving full-process integration from content creation and production to terminal exhibition, enhancing the conversion efficiency from content to commercial monetization[23](index=23&type=chunk) - Strategic investment in 52TOYS aims to share brand growth and potential capital appreciation from market expansion, and synergize the Group's strong film and television IP content advantages with 52TOYS' product design, development, and channel capabilities to expand diversified revenue sources[24](index=24&type=chunk) - The acquisition of a **30% equity stake in 99bill** is a key initiative to deepen the "Culture + Technology + Finance" strategic layout, aiming to strengthen strategic control over the financial payment segment within the digital content ecosystem closed loop[25](index=25&type=chunk) [Collaborating with Wanda Film, Strengthening Full Industry Chain Synergy](index=9&type=section&id=Collaborating%20with%20Wanda%20Film%2C%20Strengthening%20Full%20Industry%20Chain%20Synergy) The company's investment in Wanda Film integrates the entire process from content creation and production to terminal exhibition, leveraging Wanda Film's cinema network and vast audience data to enhance content monetization efficiency, optimize project decision-making and promotion strategies, and provide channel advantages for IP derivatives, expanding non-box office revenue - Investment in Wanda Film lays a core foundation for the company's film-game full industry chain layout, with strategic synergies gradually transforming into performance growth drivers[23](index=23&type=chunk) - Leveraging Wanda Film's vast audience data and consumer behavior insights, big data analysis technology empowers content creation and project decision-making, improving project ROI[23](index=23&type=chunk) - Wanda Film's millions of members and cinema scene traffic are expected to provide natural channel advantages for the company's film and television IP derivatives, expanding non-box office revenue[23](index=23&type=chunk) [Strategic Investment in 52TOYS, Expanding IP Derivative Business](index=9&type=section&id=Strategic%20Investment%20in%2052TOYS%2C%20Expanding%20IP%20Derivative%20Business) The Group strategically invested in Beijing Lezitancheng Culture Development Co., Ltd. (52TOYS) to deepen the IP value chain, share brand growth, and synergize the Group's strong film and television IP content advantages with 52TOYS' product design, development, and channel capabilities, jointly promoting innovative commercialization of film and television IP and expanding diversified revenue sources - Strategic investment in the high-growth derivative product market of trendy toys and figurines, investing in Beijing Lezitancheng Culture Development Co., Ltd. (52TOYS)[24](index=24&type=chunk) - 52TOYS possesses rich proprietary IP resources and has established cooperation and licensing relationships with numerous internationally renowned IPs[24](index=24&type=chunk) - Deeply synergizing the Group's strong film and television IP content advantages with 52TOYS' product design, development, and channel capabilities, jointly promoting innovative commercialization of film and television IP, significantly enhancing IP monetization capabilities[24](index=24&type=chunk) [Acquiring 30% Equity in 99bill, Deepening "Culture + Technology + Finance" Strategic Layout](index=9&type=section&id=Acquiring%2030%25%20Equity%20in%2099bill%2C%20Deepening%20%22Culture%20%2B%20Technology%20%2B%20Finance%22%20Strategic%20Layout) The Group initiated the acquisition of a **30% equity stake in 99bill Financial Services (Shanghai) Co., Ltd.** in July 2025, with a transaction amount of **RMB 240 million**, aiming to strengthen strategic control over the financial payment segment within the digital content ecosystem closed loop and enhance platform operational capabilities. 99bill holds a third-party payment license and has a deep presence in digital RMB applications and cross-border payments, which will bring financial technology business expansion and strategic synergistic benefits to the Group - Initiated the acquisition of a **30% equity stake in 99bill Financial Services (Shanghai) Co., Ltd.** in July 2025, with a transaction amount of **RMB 240 million**, pending PBOC approval[25](index=25&type=chunk) - This acquisition is a key initiative to deepen the "Culture + Technology + Finance" strategic layout, aiming to strengthen strategic control over the financial payment segment within the digital content ecosystem closed loop[25](index=25&type=chunk) - 99bill holds a national third-party payment license, primarily providing comprehensive payment solutions for large and medium-sized enterprises, and actively expanding into overseas markets, with a deep presence in digital RMB applications and cross-border payments[25](index=25&type=chunk) [Adjusted Net Profit](index=10&type=section&id=Adjusted%20Net%20Profit) The Group uses adjusted net profit as an additional financial measure to better reflect operating performance. In H1 2025, adjusted net profit was **RMB 1.303 billion**, a significant increase from **RMB 544 million** in the prior year period - Adjusted net profit, as a non-HKFRS measure, helps exclude the impact of items not reflecting operating performance, allowing for comparison of operating performance across periods[26](index=26&type=chunk) Adjusted Net Profit Reconciliation Statement | Indicator | 2025 June 30 (RMB Thousand) | 2024 June 30 (RMB Thousand) | | :--- | :--- | :--- | | Profit/(Loss) for the period | 1,227,634 | (122,658) | | Add: Share-based payment expenses | 26,775 | 34,463 | | Add: Convertible bond interest expense | 23,721 | — | | Add: Imputed interest expense | 24,470 | 41,377 | | Add: Fair value change of contingent consideration | — | 590,439 | | **Adjusted Net Profit** | **1,302,600** | **543,621** | [Liquidity, Capital Resources, Borrowings and Gearing Ratio](index=10&type=section&id=Liquidity%2C%20Capital%20Resources%2C%20Borrowings%20and%20Gearing%20Ratio) The Group maintains a prudent treasury policy with ample liquidity, reflected in a significant increase in cash and bank balances. Total borrowings decreased, but the gearing ratio increased due to the issuance of convertible bonds - The Group primarily funds its operations with shareholders' equity, borrowings, and cash generated from operations, closely monitoring liquidity and regularly reviewing financing needs[27](index=27&type=chunk) Liquidity and Gearing Ratio | Indicator | 2025 June 30 (RMB) | 2024 Dec 31 (RMB) | Change | | :--- | :--- | :--- | :--- | | Cash and bank balances | 5.5283 billion | 3.4936 billion | Increase | | Total borrowings | 1.0767 billion | 1.7009 billion | Decrease | | Net equity | 20.3617 billion | 16.3452 billion | Increase | | Total assets | 27.4516 billion | 21.6707 billion | Increase | | Net current assets | 11.2170 billion | 6.6604 billion | Increase | | Current ratio | 3.5 times | 2.5 times | Increase | | Gearing ratio | 11.3% | 2.0% | Increase | - The increase in cash and bank balances was primarily due to the receipt of financing funds and growth in operating results[28](index=28&type=chunk) - The increase in gearing ratio was mainly due to the issuance of convertible bonds in April 2025[138](index=138&type=chunk) [Pledged Assets, Commitments and Contingent Liabilities](index=11&type=section&id=Pledged%20Assets%2C%20Commitments%20and%20Contingent%20Liabilities) As of June 30, 2025, the Group had no pledged assets, capital commitments, or significant contingent liabilities - As of June 30, 2025, the Group had no pledged assets[30](index=30&type=chunk) - As of June 30, 2025, the Group had no capital commitments[31](index=31&type=chunk) - As of June 30, 2025, the Company and the Group had not provided any corporate guarantees to its subsidiaries or other parties, nor did they have any other significant contingent liabilities[32](index=32&type=chunk) [Currency Risk Management and Interim Dividend](index=11&type=section&id=Currency%20Risk%20Management%20and%20Interim%20Dividend) The Group faces RMB exchange rate fluctuation risks and is closely monitoring them. The Board does not recommend paying an interim dividend for H1 2025 - The Group has substantial assets and liabilities denominated in RMB, facing significant risks from RMB exchange rate fluctuations, and closely monitors exchange rate movements[33](index=33&type=chunk) - The Board does not recommend paying any interim dividend for the six months ended June 30, 2025[34](index=34&type=chunk) [Material Acquisitions and Disposals](index=12&type=section&id=Material%20Acquisitions%20and%20Disposals) In H1 2025, the Group completed the acquisition of a **30% equity stake in Beijing Yonghang Technology Co., Ltd.** for a total consideration of **RMB 825 million**, whose core assets include the "QQ Dance" series of games - On January 13, 2025, the Group entered into an equity transfer agreement to conditionally agree to acquire a total of **30% equity stake in Beijing Yonghang Technology Co., Ltd.**[35](index=35&type=chunk) Beijing Yonghang Equity Acquisition Details | Indicator | Details | | :--- | :--- | | Acquisition Target | 30% equity stake in Beijing Yonghang Technology Co., Ltd. | | Total Consideration | RMB 825 million | | Payment Method | Cash RMB 742.5 million + Issuance of 36,666,667 new shares | | Share Issue Price | HKD 2.432 per share | | Core Assets | "QQ Dance," "QQ Dance 2," "QQ Dance Mobile," and other games | - The consideration shares were allotted and issued to Tencent Hong Kong on April 10, 2025[36](index=36&type=chunk) [Material Investments](index=12&type=section&id=Material%20Investments) Except as disclosed in this report, as of June 30, 2025, the Group held no other material investments, and the Board had no plans for other material investments or additions to capital assets - As of June 30, 2025, the Group held no material investments[37](index=37&type=chunk) - As of the date of this report, the Board had not approved any other material investments or plans for additions to capital assets[37](index=37&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=13&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20the%20Company%27s%20Listed%20Securities) During the reporting period, the Group raised approximately **HKD 6.179 billion** through share subscriptions and convertible bond issuance, primarily for business development and expansion and general working capital - The company entered into two separate subscription agreements and one placing agreement in January 2025, with total net proceeds of approximately **HKD 3.870 billion**[38](index=38&type=chunk)[39](index=39&type=chunk)[40](index=40&type=chunk) - The company issued convertible bonds with a total principal amount of **HKD 2.341 billion** in April 2025, with estimated total net proceeds of approximately **HKD 2.304 billion**[44](index=44&type=chunk)[46](index=46&type=chunk) [Subscription of New Shares under General Mandate Subscription Agreement and Placing of New Shares under General Mandate Placing Agreement](index=13&type=section&id=Subscription%20of%20New%20Shares%20under%20General%20Mandate%20Subscription%20Agreement%20and%20Placing%20of%20New%20Shares%20under%20General%20Mandate%20Placing%20Agreement) On January 27, 2025, the company signed subscription agreements with Sunshine Life Insurance Corporation Ltd. and TFI Investment Fund SPC to issue 1,144,514,767 subscription shares at **HKD 2.37 per share**, totaling approximately **HKD 2.712 billion**. On the same day, it signed a placing agreement with TFI Securities and Futures Limited to place up to 490,506,329 placing shares, totaling approximately **HKD 1.1625 billion** - Entered into subscription agreements with Sunshine Life Insurance Corporation Ltd. and TFI Investment Fund SPC to issue a total of **1,144,514,767 subscription shares** at a subscription price of **HKD 2.37 per share**[38](index=38&type=chunk) - Entered into a placing agreement with TFI Securities and Futures Limited to place up to **490,506,329 placing shares** at a price of **HKD 2.37 per share**[39](index=39&type=chunk) Share Subscription and Placing Details | Item | Number of Shares | Price (HKD/share) | Total Proceeds (HKD) | | :--- | :--- | :--- | :--- | | Subscription Shares | 1,144,514,767 | 2.37 | ~2,712,499,998 | | Placing Shares | 490,506,329 | 2.37 | ~1,162,500,000 | | **Total** | **1,635,021,096** | **-** | **~3,874,999,998** | [Use of Proceeds from Share Subscription](index=13&type=section&id=Use%20of%20Proceeds%20from%20Share%20Subscription) The net proceeds from the share subscription and placing amounted to approximately **HKD 3.87 billion**, with **90% (approximately HKD 3.483 billion)** allocated for business development and expansion, including content production, script and copyright acquisition, and **10% (approximately HKD 387 million)** for general working capital. As of June 30, 2025, **HKD 1.4 billion** had been utilized, with the remaining **HKD 2.47 billion** expected to be utilized by December 31, 2026 Use of Proceeds from Share Subscription and Utilization Status (as of June 30, 2025) | Purpose | Allocated Amount (approx. HKD million) | % of Total Net Proceeds | Utilized Amount (HKD million) | Unutilized Amount (HKD million) | Expected Utilization Time | | :--- | :--- | :--- | :--- | :--- | :--- | | Growth and expansion of the Group's business | 3,483 | 90 | 1,050 | 2,433 | Before December 31, 2026 | | - Content production | 968 | 25 | 180 | 788 | Before December 31, 2026 | | - Purchase of scripts and copyrights | 387 | 10 | 280 | 107 | Before December 31, 2026 | | - Purchase of film and TV program copyrights | 387 | 10 | 148 | 238 | Before December 31, 2026 | | - Others (e.g., development of online gaming business) | 1,741 | 45 | 441 | 1,300 | Before December 31, 2026 | | General working capital purposes | 387 | 10 | 350 | 37 | Before December 31, 2026 | | **Total** | **3,870** | **100** | **1,400** | **2,470** | N/A | [Issuance of HKD 2,341 Million 3.95% Convertible Bonds Due 2030 under General Mandate](index=15&type=section&id=Issuance%20of%20HKD%202%2C341%20Million%203.95%25%20Convertible%20Bonds%20Due%202030%20under%20General%20Mandate) On April 14, 2025, the company entered into a subscription agreement with joint lead managers to issue convertible bonds with a total principal amount of **HKD 2.341 billion** and an annual interest rate of **3.95%**, maturing in 2030. The bonds are convertible into ordinary shares at an initial conversion price of **HKD 2.704 per share** - On April 14, 2025, the company entered into a subscription agreement to issue convertible bonds with a total principal amount of **HKD 2.341 billion**[44](index=44&type=chunk) - The bonds bear interest at an annual rate of **3.95%**, payable semi-annually, and will mature in 2030[174](index=174&type=chunk) - The bonds are convertible into conversion shares at an initial conversion price of **HKD 2.704 per conversion share** according to the terms[44](index=44&type=chunk) [Use of Bond Proceeds](index=15&type=section&id=Use%20of%20Bond%20Proceeds) The net proceeds from the convertible bonds amounted to approximately **HKD 2.304 billion**, with **90% (approximately HKD 2.074 billion)** allocated for business development and expansion, including content production, script and copyright acquisition, and **10% (approximately HKD 230 million)** for general working capital. As of June 30, 2025, all proceeds remained unutilized and are expected to be utilized by December 31, 2027 Use of Convertible Bond Proceeds and Utilization Status (as of June 30, 2025) | Purpose | Allocated Amount (approx. HKD million) | % of Total Net Proceeds | Utilized Amount (HKD million) | Unutilized Amount (HKD million) | Expected Utilization Time | | :--- | :--- | :--- | :--- | :--- | :--- | | For the Group's business development and expansion | 2,074 | 90 | — | 2,074 | Before December 31, 2027 | | - Content production | 829 | 36 | — | 829 | Before December 31, 2027 | | - Purchase of scripts and copyrights | 230 | 10 | — | 230 | Before December 31, 2027 | | - Purchase of film and TV program copyrights | 230 | 10 | — | 230 | Before December 31, 2027 | | - Others (e.g., development of online gaming business) | 785 | 34 | — | 785 | Before December 31, 2027 | | General working capital purposes | 230 | 10 | — | 230 | Before December 31, 2027 | | **Total** | **2,304** | **100** | **—** | **2,304** | N/A | [Shares Issued upon Exercise of Warrants](index=16&type=section&id=Shares%20Issued%20upon%20Exercise%20of%20Warrants) In December 2024, the company issued a total of **1,834,279,307 shares** upon the exercise of warrants, raising net proceeds of approximately **HKD 1.761 billion**, all of which were used for general corporate purposes and fully utilized by June 30, 2025 - On December 27, 2024, and December 31, 2024, the company issued a total of **1,834,279,307 shares** upon the exercise of warrants[48](index=48&type=chunk) - The exercise price of the warrants was **HKD 0.96 per share**, raising net proceeds of approximately **HKD 1.761 billion**[48](index=48&type=chunk)[49](index=49&type=chunk) - The entire amount of these net proceeds was intended for general corporate purposes and was fully utilized by June 30, 2025[49](index=49&type=chunk)[50](index=50&type=chunk) [Share-based Payments](index=17&type=section&id=Share-based%20Payments) The Group has a 2013 Share Option Scheme (terminated but existing options remain valid) and a 2023 Share Option Scheme (adopted but no options granted yet), aimed at incentivizing eligible participants - The 2013 Share Option Scheme was terminated on June 28, 2023, but options granted prior to that date remain valid and exercisable[51](index=51&type=chunk) - The 2023 Share Option Scheme was adopted on June 28, 2023, to grant share options to eligible participants as incentives or rewards[59](index=59&type=chunk) [2013 Share Option Scheme](index=17&type=section&id=2013%20Share%20Option%20Scheme) The 2013 Share Option Scheme was terminated in June 2023, but previously granted options remain valid. As of June 30, 2025, **181,228,000 options** under the scheme remained unexercised, with Executive Director Mr. Zhang Qiang holding **10,000,000 options** and senior management and employees holding **123,228,000 options** - As of June 30, 2025, **181,228,000 granted share options** under the 2013 Share Option Scheme remained unexercised[52](index=52&type=chunk) Executive Director Mr. Zhang Qiang's Share Option Movement Details (as of June 30, 2025) | Grant Date | Unexercised as of Jan 1, 2025 (Thousand) | Unexercised as of June 30, 2025 (Thousand) | Exercise Price (HKD/share) | | :--- | :--- | :--- | :--- | | Nov 26, 2021 | 10,000 | 10,000 | 3.43 | Senior Management and Employees' Share Option Movement Details (as of June 30, 2025) | Grant Date | Unexercised as of Jan 1, 2025 (Thousand) | Unexercised as of June 30, 2025 (Thousand) | Exercise Price (HKD/share) | | :--- | :--- | :--- | :--- | | Nov 26, 2021 | 123,228 | 123,228 | 3.43 | [2023 Share Option Scheme](index=19&type=section&id=2023%20Share%20Option%20Scheme) The 2023 Share Option Scheme was adopted in June 2023, valid for ten years, to reward employees, directors, connected entity participants, and service providers who contribute to the Group. The exercise price is the highest of the closing price on the grant date, the average closing price of the preceding five trading days, or the nominal value, and options must be held for at least twelve months before exercise. As of June 30, 2025, no options had been granted under this scheme - The scheme will expire ten years after the adoption date (i.e., June 27, 2033)[59](index=59&type=chunk) - Eligible participants include the Group's directors, senior officers, employees, connected entity participants, and service providers[60](index=60&type=chunk)[65](index=65&type=chunk) - The subscription price for share options is the highest of the closing price on the grant date, the average closing price of the five trading days immediately preceding the grant date, or the nominal value of the shares[62](index=62&type=chunk) - No share options have been granted by the company under the 2023 Share Option Scheme since its adoption and up to the date of this report[63](index=63&type=chunk) [Directors' Interests and Short Positions in Shares, Underlying Shares and Debentures](index=21&type=section&id=Directors%27%20Interests%20and%20Short%20Positions%20in%20Shares%2C%20Underlying%20Shares%20and%20Debentures) As of June 30, 2025, Directors Mr. Ke Liming, Mr. Zhang Qiang, and Mr. Yang Ming held interests in the company's shares or underlying shares, with Mr. Ke Liming holding approximately **16.92%** of share interests through controlled corporations and other means, Mr. Zhang Qiang holding share options, and Mr. Yang Ming directly holding shares Directors' Long Positions in the Company's Shares (as of June 30, 2025) | Director's Name | Nature of Interest | Beneficial Interest in Shares | Approximate Percentage of Interest | | :--- | :--- | :--- | :--- | | Mr. Ke Liming | Controlled Corporation | 2,120,671,294 | 13.66% | | | Other | 506,709,956 | 3.26% | | Mr. Zhang Qiang | Beneficial Owner (Share Option Related Shares) | 10,000,000 | 0.06% | | Mr. Yang Ming | Beneficial Owner | 1,080,000 | 0.01% | - Mr. Ke Liming indirectly holds **2,627,381,250 shares** in the company through Pumpkin Films Limited[66](index=66&type=chunk) - Pumpkin Films Limited entered into share borrowing and lending agreements with Merrill Lynch International and Goldman Sachs International to facilitate on-lending to bondholders for hedging transactions[67](index=67&type=chunk) [Directors' Rights to Acquire Shares or Debentures](index=22&type=section&id=Directors%27%20Rights%20to%20Acquire%20Shares%20or%20Debentures) During the reporting period, neither the company nor its subsidiaries entered into any arrangements enabling directors to benefit from acquiring shares or debt securities of the company or any other body corporate, nor did any director, their spouse, or children under 18 possess any rights to subscribe for the company's securities - Neither the company nor any of its subsidiaries entered into any arrangements at any time during the reporting period enabling directors to benefit from acquiring shares or debt securities of the company or any other body corporate[70](index=70&type=chunk) - No director, their spouse, or children under the age of eighteen possessed any rights to subscribe for the company's securities, nor had any such rights been exercised during the reporting period[70](index=70&type=chunk) [Shareholders' Interests and Short Positions Disclosable under the SFO](index=22&type=section&id=Shareholders%27%20Interests%20and%20Short%20Positions%20Disclosable%20under%20the%20SFO) As of June 30, 2025, and August 25, 2025, major shareholders included Mr. Ke Liming, Pumpkin Films Limited, Tencent Holdings and its subsidiary Water Lily, and Sunshine Life Insurance Corporation Ltd., all holding over **5%** of the shares Major Shareholders' Interests in Shares and Underlying Shares — Long Positions (as of June 30, 2025) | Shareholder Name/Name | Total (Number of Shares) | Capacity | Approximate Percentage of Company's Issued Share Capital | | :--- | :--- | :--- | :--- | | Mr. Ke Liming | 2,120,671,294 | Controlled Corporation | 13.66% | | | 506,709,956 | Other | 3.26% | | Pumpkin Films Limited | 2,120,671,294 | Beneficial Owner | 13.66% | | | 506,709,956 | Other | 3.26% | | Tencent Holdings | 2,582,401,232 | Controlled Corporation | 16.64% | | Water Lily | 2,545,734,565 | Beneficial Owner | 16.40% | | Sunshine Life Insurance Corporation Ltd. | 1,141,508,438 | Beneficial Owner | 7.36% | Major Shareholders' Interests in Shares and Underlying Shares — Long Positions (as of August 25, 2025) | Shareholder Name/Name | Total (Number of Shares) | Capacity | Approximate Percentage of Company's Issued Share Capital | | :--- | :--- | :--- | :--- | | Mr. Ke Liming | 2,120,671,294 | Controlled Corporation | 12.93% | | | 506,709,956 | Other | 3.09% | | Pumpkin Films Limited | 2,120,671,294 | Beneficial Owner | 12.93% | | | 506,709,956 | Other | 3.09% | | Tencent Holdings | 2,582,401,232 | Controlled Corporation | 15.75% | | Water Lily | 2,545,734,565 | Beneficial Owner | 15.52% | | Sunshine Life Insurance Corporation Ltd. | 1,141,508,438 | Beneficial Owner | 6.96% | - Tencent Holdings indirectly holds interests in **2,582,401,232 shares**, most of which are directly held by its indirect wholly-owned subsidiary, Water Lily[72](index=72&type=chunk)[75](index=75&type=chunk) [Disclosure of Directors' Information and Number of Employees and Remuneration Policy under Listing Rule 13.51B(1)](index=24&type=section&id=Disclosure%20of%20Directors%27%20Information%20and%20Number%20of%20Employees%20and%20Remuneration%20Policy%20under%20Listing%20Rule%2013.51B(1)) As of June 30, 2025, the Group employed **583 employees**, with total staff costs of approximately **RMB 161.3 million**, and its remuneration policy aims to compensate based on qualifications, experience, performance, and market levels - During the reporting period and up to the date of this report, the Board of Directors included Executive Directors Mr. Ke Liming, Mr. Zhang Qiang, Non-executive Director Mr. Yang Ming, and Independent Non-executive Directors Mr. Zhou Chengyan, Mr. Nie Zhixin, Mr. Chen Haiquan, and Professor Shi Zhuomin[76](index=76&type=chunk) Employee Information and Costs | Indicator | 2025 June 30 | 2024 June 30 | | :--- | :--- | :--- | | Number of Employees | 583 | - | | Total Staff Costs (RMB) | 161.3 million | 133.2 million | - The Group's remuneration policy aims to compensate its employees based on their qualifications, experience, performance, and market levels, with employee benefits including medical insurance, mandatory provident fund, etc[76](index=76&type=chunk) [Material Events After Reporting Period](index=24&type=section&id=Material%20Events%20After%20Reporting%20Period) After the reporting period, the company allotted and issued shares to TFI Investment in July 2025, and on July 31, 2025, entered into a subscription agreement with Wuji Capital Management Co., Ltd. to issue a total of **1.3 billion subscription shares** at **HKD 3.00 per share**, totaling approximately **HKD 3.9 billion**, with the first batch of **390 million shares** completed on August 18 - On July 8, 2025, and July 24, 2025, the company allotted and issued **327,004,000 shares** and **163,502,329 shares** respectively to TFI Investment[77](index=77&type=chunk) - On July 31, 2025, the company entered into a subscription agreement with Wuji Capital Management Co., Ltd. to conditionally agree to issue and allot a total of **1,300,000,000 subscription shares** at **HKD 3.00 per share**[77](index=77&type=chunk) - A total of **390,000,000 subscription shares** were subscribed by the subscriber and allotted and issued by the company on August 18, 2025[78](index=78&type=chunk) [Continuing Disclosure Obligations under Listing Rules](index=25&type=section&id=Continuing%20Disclosure%20Obligations%20under%20Listing%20Rules) The company has no other disclosure obligations under Listing Rules 13.20, 13.21, and 13.22 - The company has no other disclosure obligations under Listing Rules 13.20, 13.21, and 13.22[80](index=80&type=chunk) [Review of Interim Results](index=25&type=section&id=Review%20of%20Interim%20Results) The company's interim financial information for the six months ended June 30, 2025, has been reviewed by the Audit Committee and by PricewaterhouseCoopers in accordance with Hong Kong Standard on Review Engagements 2410 - The company's interim financial information for the six months ended June 30, 2025, has been reviewed by the company's Audit Committee[81](index=81&type=chunk) - PricewaterhouseCoopers has reviewed the Group's unaudited condensed consolidated interim financial information in accordance with Hong Kong Standard on Review Engagements 2410 issued by the Hong Kong Institute of Certified Public Accountants[81](index=81&type=chunk) [Corporate Governance and Compliance with Model Code](index=25&type=section&id=Corporate%20Governance%20and%20Compliance%20with%20Model%20Code) The company has adopted and complied with the Corporate Governance Code, except for the non-separation of Chairman and CEO roles due to the absence of a CEO position. All directors complied with the Model Code during the reporting period - The company has adopted and complied with the code provisions contained in Appendix C1 "Corporate Governance Code" of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[82](index=82&type=chunk) - The company has not established a Chief Executive Officer position, and the Board believes the current structure is conducive to strengthening and unifying leadership and oversight, enabling efficient operation of the Group[82](index=82&type=chunk) - The company confirms that all directors have complied with the Model Code for Securities Transactions by Directors of Listed Issuers contained in Appendix C3 of the Listing Rules throughout the six months ended June 30, 2025[83](index=83&type=chunk) [Forward-Looking Statements and Acknowledgements](index=26&type=section&id=Forward-Looking%20Statements%20and%20Acknowledgements) Forward-looking statements in the Management Discussion and Analysis are not guarantees of achievement, and shareholders and potential investors should exercise caution. The Board expresses sincere gratitude for the support of shareholders, investors, employees, and business partners - There is no assurance that any forward-looking statements regarding the Group's business development contained in this Management Discussion and Analysis will be achieved, will actually occur or materialize, or will be complete or accurate[84](index=84&type=chunk) - Shareholders and/or potential investors of the company are urged to exercise caution when dealing in the company's securities and not to place undue reliance on the information disclosed in this Management Discussion and Analysis[84](index=84&type=chunk) - The Board wishes to express its sincere gratitude to the company's shareholders, investors, employees, and business partners for their long-standing support[85](index=85&type=chunk) [Independent Auditor's Review Report](index=27&type=section&id=Independent%20Auditor%27s%20Review%20Report) [Scope of Review and Conclusion](index=27&type=section&id=Scope%20of%20Review%20and%20Conclusion) PricewaterhouseCoopers reviewed the Group's interim financial information for the six months ended June 30, 2025, in accordance with HKSRS 2410, finding no matters that would lead them to believe the information was not prepared in all material respects according to HKAS 34 - The auditor has reviewed the interim financial information set out on pages 28 to 78, including the interim condensed consolidated statement of financial position, statement of profit or loss and other comprehensive income, statement of changes in equity, and statement of cash flows[88](index=88&type=chunk) - A review is substantially less in scope than an audit conducted in accordance with Hong Kong Standards on Auditing, and consequently, no audit opinion is expressed[89](index=89&type=chunk) - Based on the review, nothing has come to the auditor's attention that causes them to believe that the Group's interim financial information is not prepared, in all material respects, in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting" issued by the Hong Kong Institute of Certified Public Accountants[90](index=90&type=chunk) [Interim Condensed Consolidated Statement of Financial Position](index=29&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Financial%20Position) [Overview of Assets, Equity and Liabilities](index=29&type=section&id=Overview%20of%20Assets%2C%20Equity%20and%20Liabilities) As of June 30, 2025, the Group's total assets reached **RMB 27.452 billion**, a **26.7% increase** from year-end 2024, driven by growth in current assets and financial assets. Total equity rose to **RMB 20.342 billion**, and total liabilities increased to **RMB 7.110 billion**, reflecting business expansion and financing activities Key Data from Condensed Consolidated Statement of Financial Position | Indicator | 2025 June 30 (RMB Thousand) | 2024 Dec 31 (RMB Thousand) | Change Rate | | :--- | :--- | :--- | :--- | | **Assets** | | | | | Non-current assets | 11,723,762 | 10,648,396 | +10.1% | | Current assets | 15,727,847 | 11,022,317 | +42.7% | | **Total Assets** | **27,451,609** | **21,670,713** | **+26.7%** | | **Equity** | | | | | Equity attributable to equity holders of the Company | 20,361,741 | 16,345,215 | +24.6% | | Non-controlling interests | (20,074) | (12,608) | - | | **Total Equity** | **20,341,667** | **16,332,607** | **+24.5%** | | **Liabilities** | | | | | Non-current liabilities | 2,599,131 | 976,154 | +166.2% | | Current liabilities | 4,510,811 | 4,361,952 | +3.4% | | **Total Liabilities** | **7,109,942** | **5,338,106** | **+33.2%** | | **Total Equity and Liabilities** | **27,451,609** | **21,670,713** | **+26.7%** | - The significant increase in non-current liabilities was primarily due to the issuance of convertible bonds[93](index=93&type=chunk)[174](index=174&type=chunk) - The notable growth in current assets mainly came from financial assets at fair value through profit or loss and cash and cash equivalents[92](index=92&type=chunk) [Interim Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=31&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) [Revenue and Profitability Analysis](index=31&type=section&id=Revenue%20and%20Profitability%20Analysis) The Group achieved revenue of **RMB 2.206 billion** in H1 2025, a **20% year-on-year increase**, and successfully turned a loss into a profit, recording a profit attributable to equity holders of the Company of **RMB 1.235 billion**, with basic earnings per share of **RMB 8.14 cents**, demonstrating a significant improvement in profitability Key Data from Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income | Indicator | 2025 June 30 (RMB Thousand) | 2024 June 30 (RMB Thousand) | Change Rate | | :--- | :--- | :--- | :--- | | Revenue | 2,206,249 | 1,839,559 | +20.0% | | Cost of revenue | (1,083,467) | (575,467) | +88.3% | | Gross profit | 1,122,782 | 1,264,092 | -11.2% | | Operating profit | 1,336,434 | 62,568 | +2035.8% | | Profit before income tax | 1,478,141 | 60,034 | +2362.1% | | Profit/(Loss) for the period | 1,227,634 | (122,658) | Turned loss into profit | | Profit/(Loss) attributable to equity holders of the Company | 1,235,100 | (114,653) | Turned loss into profit | | Basic earnings/(loss) per share (RMB cents) | 8.14 | (0.98) | Turned loss into profit | | Diluted earnings/(loss) per share (RMB cents) | 8.12 | (0.98) | Turned loss into profit | - Gross profit decreased by **11.2%** primarily due to an **88.3% significant increase** in cost of revenue, but operating profit and profit before income tax both achieved substantial growth, reflecting the positive impact of other income[95](index=95&type=chunk) - Other income/(loss) — net turned from a loss of **RMB 903 million** in H1 2024 to a gain of **RMB 480 million** in H1 2025, a significant factor in the period's turnaround to profit[95](index=95&type=chunk)[186](index=186&type=chunk) [Interim Condensed Consolidated Statement of Changes in Equity](index=33&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) [Analysis of Changes in Equity](index=33&type=section&id=Analysis%20of%20Changes%20in%20Equity) As of June 30, 2025, total equity attributable to equity holders of the Company increased to **RMB 20.362 billion**, primarily due to profit for the period, issuance of ordinary shares, and an increase in share capital, share premium, and other reserves from the issuance of convertible bonds Key Data from Condensed Consolidated Statement of Changes in Equity | Indicator | 2025 Jan 1 (RMB Thousand) | 2025 June 30 (RMB Thousand) | | :--- | :--- | :--- | | Share capital | 273,444 | 295,236 | | Share premium | 17,069,660 | 19,631,215 | | Other reserves | 49,736 | 247,815 | | Retained earnings/(Accumulated losses) | (1,047,625) | 187,475 | | **Total attributable to equity holders of the Company** | **16,345,215** | **20,361,741** | | Non-controlling interests | (12,608) | (20,074) | | **Total Equity** | **16,332,607** | **20,341,667** | - Profit for the period of **RMB 1,235,100 thousand** significantly increased retained earnings, converting accumulated losses into retained earnings[98](index=98&type=chunk) - Issuance of ordinary shares resulted in an increase in share capital of **RMB 21,792 thousand** and an increase in share premium of **RMB 2,561,555 thousand**[98](index=98&type=chunk) - Issuance of convertible bonds led to an increase in convertible bond reserve within other reserves of **RMB 195,915 thousand**[98](index=98&type=chunk)[166](index=166&type=chunk) [Interim Condensed Consolidated Statement of Cash Flows](index=35&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) [Cash Flow Analysis](index=35&type=section&id=Cash%20Flow%20Analysis) The Group's cash and cash equivalents increased by **RMB 2.096 billion** in H1 2025, primarily driven by strong cash inflows from financing activities, offsetting net cash outflows from operating and investing activities Key Data from Condensed Consolidated Statement of Cash Flows | Indicator | 2025 June 30 (RMB Thousand) | 2024 June 30 (RMB Thousand) | | :--- | :--- | :--- | | Net cash (used in)/generated from operating activities | (94,211) | 199,224 | | Net cash (used in)/generated from investing activities | (1,832,006) | 606,022 | | Net cash generated from financing activities | 4,021,812 | 1,383,139 | | **Net increase in cash and cash equivalents** | **2,095,595** | **2,188,385** | | Cash and cash equivalents at end of period | 5,528,269 | 2,764,926 | - Net cash from operating activities turned from an inflow to an outflow year-on-year, mainly due to an increase in income tax paid[99](index=99&type=chunk) - Net cash outflow from investing activities significantly increased, primarily due to the purchase of financial assets at fair value through profit or loss and investments accounted for using the equity method[99](index=99&type=chunk) - Net cash inflow from financing activities significantly increased, mainly from the issuance of ordinary shares and convertible bonds[100](index=100&type=chunk) [Notes to the Condensed Consolidated Interim Financial Information](index=37&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Interim%20Financial%20Information) [General Information and Basis of Preparation](index=37&type=section&id=General%20Information%20and%20Basis%20of%20Preparation) China Ruyi Holdings Limited, incorporated in Bermuda, primarily engages in content production, online streaming, online gaming, and accessories manufacturing and sales. This unaudited interim financial information is prepared in accordance with HKAS 34 and approved for publication by the Board on August 25, 2025 - The company was incorporated in Bermuda as a limited liability company and is engaged in investment holding[101](index=101&type=chunk) - The Group is principally engaged in content production, online streaming services, online gaming services, and manufacturing and sales of accessories[102](index=102&type=chunk) - This interim financial information is unaudited and has been prepared in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting" issued by the Hong Kong Institute of Certified Public Accountants[104](index=104&type=chunk)[105](index=105&type=chunk) [Accounting Policies and Critical Accounting Estimates and Judgements](index=37&type=section&id=Accounting%20Policies%20and%20Critical%20Accounting%20Estimates%20and%20Judgements) The Group's accounting policies are consistent with the previous financial year, except for the adoption of revised standards and accounting policies for convertible bonds. The fair value estimation of convertible bonds is a critical judgment, with the liability component measured at amortized cost and the equity component not remeasured after initial recognition - The accounting policies adopted are consistent with those of the previous financial year and the corresponding interim reporting period, except for the adoption of revised standards and accounting policies for convertible bonds as set out in Note 4[106](index=106&type=chunk) - New and revised standards and interpretations that have been issued but are not yet effective are not expected to have a significant impact on the Group's financial performance and position upon their effective date[109](index=109&type=chunk) - The fair value of the liability component of convertible bonds is determined using market interest rates for non-convertible bonds with similar terms and is accounted for on an amortized cost basis[111](index=111&type=chunk) - The equity component of convertible bonds is not remeasured after initial recognition[111](index=111&type=chunk) [Financial Risk Management](index=39&type=section&id=Financial%20Risk%20Management) The Group faces market risks (foreign exchange, price, interest rate), credit risk, and liquidity risk, maintaining prudent risk management policies. Credit risk primarily arises from trade and other receivables, with sufficient impairment provisions made. The gearing ratio increased due to convertible bond issuance - The Group's business is exposed to various financial risks: market risk (including foreign exchange risk, price risk, and interest rate risk), credit risk, and liquidity risk[112](index=112&type=chunk) - The Group is exposed to credit risk in relation to financial assets at fair value through other comprehensive income, trade and other receivables, and cash and cash equivalents[114](index=114&type=chunk) - The Group monitors capital on the basis of the gearing ratio, which was **11.1%** as of June 30, 2025, an increase from **8.2%** as of December 31, 2024, primarily due to the issuance of convertible bonds in April 2025[137](index=137&type=chunk)[138](index=138&type=chunk) [Financial Risk Factors](index=39&type=section&id=Financial%20Risk%20Factors) The Group's overall risk management program focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects on its financial performance. There have been no changes in the Group's risk management policies since December 31, 2024 - The Group's overall risk management program focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects on the Group's financial performance[112](index=112&type=chunk) - There have been no changes in the Group's risk management policies since December 31, 2024[113](index=113&type=chunk) [Credit Risk](index=39&type=section&id=Credit%20Risk) The Group applies a simplified approach to measure expected credit losses for trade receivables, individually assesses known insolvent receivables, and groups others based on common credit risk characteristics. Other receivables and deposits are assessed on a 12-month expected loss basis, with lifetime expected losses applied if credit risk significantly increases - The Group's management has established a dedicated team responsible for setting credit limits, credit approvals, and other monitoring procedures to ensure follow-up actions are taken to recover overdue debts[115](index=115&type=chunk) - Impairment losses on trade receivables are presented as "Net impairment losses on financial assets" in the consolidated statement of profit or loss and other comprehensive income[125](index=125&type=chunk) Reconciliation of Impairment Provisions for Trade and Other Receivables | Indicator | Trade Receivables (RMB Thousand) | Other Receivables and Deposits (RMB Thousand) | Total (RMB Thousand) | | :--- | :--- | :--- | :--- | | Balance as of Jan 1, 2025 | 296,804 | 82,935 | 379,739 | | Impairment losses (reversed)/provided | (1,049) | 12,980 | 11,931 | | Exchange differences | (16) | (172) | (188) | | Balance as of June 30, 2025 | 295,739 | 95,743 | 391,482 | [Capital Risk Management](index=46&type=section&id=Capital%20Risk%20Management) The Group manages capital risk by monitoring the gearing ratio, calculated as total borrowings (including borrowings, lease liabilities, and convertible bonds) divided by total assets. As of June 30, 2025, the gearing ratio was **11.1%**, an increase from **8.2%** at year-end 2024, primarily due to the issuance of convertible bonds - The Group's objective in managing capital is to safeguard its ability to continue as a going concern, so as to provide returns and benefits for equity holders and other stakeholders, while maintaining an optimal capital structure to reduce the cost of capital[137](index=137&type=chunk) Gearing Ratio | Indicator | 2025 June 30 (RMB Thousand) | 2024 Dec 31 (RMB Thousand) | | :--- | :--- | :--- | | Total borrowings, lease liabilities and convertible bonds | 3,053,777 | 1,766,541 | | Total assets | 27,451,609 | 21,670,713 | | **Gearing Ratio** | **11.1%** | **8.2%** | - The gearing ratio as of June 30, 2025, increased compared to December 31, 2024, primarily due to the issuance of convertible bonds in April 2025[138](index=138&type=chunk) [Fair Value Estimation](index=47&type=section&id=Fair%20Value%20Estimation) The Group's financial assets and liabilities are measured at fair value and categorized into three levels based on the observability of market data. As of June 30, 2025, financial assets at fair value through profit or loss totaled **RMB 6.370 billion**, primarily comprising unlisted funds and unlisted company investments Financial Assets Measured at Fair Value (as of June 30, 2025) | Category | Level 1 (RMB Thousand) | Level 2 (RMB Thousand) | Level 3

Core Viewpoint - China Ruyi (0136.HK) reported a significant turnaround in its financial performance for the first half of 2025, achieving a revenue of 2.206 billion yuan, a year-on-year increase of 19.93%, and a net profit of 1.228 billion yuan, compared to a loss of 123 million yuan in the same period last year [1] Group 1: Financial Performance - The company's adjusted profit reached 1.303 billion yuan, reflecting a substantial year-on-year growth of 140%, indicating a fundamental improvement in profitability [1] - Revenue breakdown by segment includes content production at 570 million yuan (up 1085%), online streaming services at 406 million yuan (down 55%), online gaming services at 1.21 billion yuan (up 40%), and merchandise sales at 20 million yuan (up 10%) [1] Group 2: Content Production Business - The content production segment saw a remarkable revenue increase of 1085% to 570 million yuan, driven by the strong box office performance of several key films [2] - Notable films include "Detective Chinatown 1900" with over 3.6 billion yuan in box office, and "Boonie Bears: Back to Earth" with 821 million yuan [2] - The company has a rich pipeline of projects, including "Cloud Like You," "We Live in Nanjing," and collaborations with animation studios, which are expected to contribute to future revenue growth [2] Group 3: Gaming Business - Online gaming services generated 1.21 billion yuan in revenue, marking a 40% year-on-year increase, maintaining high growth levels [2] - Classic titles continue to provide stable revenue, with "Red Alert OL" achieving over 6 billion yuan in cumulative revenue since launch [2] - New releases like "Epoch of Stars" and "Dragon Stone War" have performed well, with "Epoch of Stars" entering the iOS top ten sales shortly after launch [2] Group 4: Streaming Business - The online streaming services segment reported a revenue of 406 million yuan, a decline of 55% year-on-year [3] - The company is enhancing user experience through AI technology, which includes personalized recommendations and plans for AI-generated video commentary [3] - Continued application of AI is expected to help maintain market leadership and improve overall performance [3] Group 5: Investment and M&A Activities - The company invested in Wanda Film in 2023 to integrate the content creation and distribution chain, leveraging Wanda's audience data for market insights [3] - Strategic investment in Beijing Lezi Tiancheng Cultural Development Co., Ltd. targets the high-growth market for collectibles and derivatives [3] - A 30% stake acquisition in Kuaiqian Financial Services aims to build a digital content ecosystem, creating a "culture + technology + finance" closed loop [3] Group 6: Industry Outlook - The film industry is expected to recover steadily in 2025, enhancing the competitive advantage and market share of quality film leaders [4] - The company forecasts revenues of 4.84 billion yuan and 5.89 billion yuan for 2025 and 2026, respectively, with year-on-year growth rates of 32% and 22% [4] - Projected net profits for the same period are 1.64 billion yuan and 2.03 billion yuan, with corresponding price-to-earnings ratios of 25.9 and 21.0 times [4]

Investment Rating - The investment rating for the company is "Buy" with a target price not specified [7][6]. Core Viewpoints - The company reported a significant recovery in its financial performance for the first half of 2025, achieving a revenue of 2.206 billion yuan, a year-on-year increase of 19.93%, and a net profit of 1.228 billion yuan, reversing a loss of 123 million yuan from the previous year [2]. - The content production segment saw a remarkable revenue increase of 1085% to 570 million yuan, driven by strong box office performances of several films [3]. - The online gaming service segment generated 1.210 billion yuan in revenue, reflecting a 40% year-on-year growth, supported by the sustained popularity of classic titles and successful new releases [4]. - The online streaming service segment experienced a decline in revenue to 406 million yuan, down 55% year-on-year, but is expected to improve with the application of AI technology [5]. - The company is focusing on strategic investments to enhance its core business and expand its IP ecosystem, including investments in Wanda Film and other high-growth markets [5]. Summary by Sections Financial Performance - For the first half of 2025, the company achieved a revenue of 2.206 billion yuan, a 19.93% increase year-on-year, and a net profit of 1.228 billion yuan, compared to a loss of 123 million yuan in the same period last year [2]. Content Production - The content production business generated 570 million yuan in revenue, marking a 1085% increase, primarily due to the success of films like "Detective Chinatown 1900" and "Boonie Bears: Back to Earth" [3]. Gaming Business - The online gaming service revenue reached 1.210 billion yuan, a 40% increase year-on-year, with strong performances from both classic and newly launched games [4]. Streaming Services - The online streaming service revenue was 406 million yuan, down 55% year-on-year, but improvements are anticipated through AI-driven enhancements [5]. Strategic Investments - The company is making strategic investments to strengthen its core business and expand its IP ecosystem, including a significant investment in Wanda Film and a focus on high-growth derivative markets [5].

Group 1: Market Overview - The Hong Kong capital market is expected to see a significant recovery in 2025, with IPO financing reaching HKD 132.9 billion in the first eight months, marking a 50% increase compared to the total for 2024 [1] - The secondary market for Hong Kong stocks has shown even stronger performance, with fundraising reaching HKD 190.5 billion, which is 3.8 times higher than the total for 2024 [1] Group 2: Company Specifics - China Ruyi's capital increase in July 2025 amounted to HKD 3.9 billion, making it the tenth largest fundraising project of the year, with a discount of less than 4.5%, the lowest among the year's rapid placement projects [4] - The company experienced a turnaround in profitability in the first half of 2025, achieving a net profit of HKD 1.235 billion, a 57% year-on-year increase [4] - Despite strong performance in film and gaming, the announcement of a 30% stake acquisition in Wanda Quick Money Financial led to a decline in stock price due to concerns over strategic trust [4][5] Group 3: Financial Risks - Wanda Quick Money Financial has faced compliance issues, receiving four fines from the central bank totaling over HKD 17 million since 2022, raising concerns about its risk profile [5] - The valuation of Wanda Quick Money has significantly decreased from HKD 3.3 billion to HKD 800 million over 11 years, indicating potential asset quality issues [5] - The delayed delivery of shares from the capital increase process has raised questions about the authenticity of the financing, impacting market confidence [5]

股份發行人及根據《上市規則》第十九B章上市的香港預託證券發行人的證券變動月報表 截至月份: 2025年8月31日 狀態: 新提交 致：香港交易及結算所有限公司 公司名稱: 中國儒意控股有限公司 呈交日期: 2025年9月4日 I. 法定/註冊股本變動 | 1. 股份分類 | 普通股 | 股份類別 | 不適用 | | 於香港聯交所上市 (註1) | | | 是 | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | 證券代號 (如上市) | 00136 | 說明 | | | | | | | | | | | 法定/註冊股份數目 | | | 面值 | | | 法定/註冊股本 | | | 上月底結存 | | | 100,000,000,000 | HKD | | 0.02 | HKD | | 2,000,000,000 | | 增加 / 減少 (-) | | | | | | | HKD | | | | 本月底結存 | | | 100,000,000,000 | HKD | | 0.02 | HKD | | 2,000,000,000 | ...

Core Insights - The film industry has shown significant profitability in the first half of the year, with major companies like Wanda Film and Light Media reporting substantial net profit increases of 372.55% and 371.55% respectively [1][3] - The growth in profits is attributed not only to blockbuster films but also to optimized non-ticket business operations, cost control, and improved operational efficiency [1][5] - The competition in the film industry has evolved from content-based competition to a focus on comprehensive operational capabilities, with companies that can integrate industry chains and innovate business models expected to have a competitive edge in the future [9] Group 1: Box Office Performance - The total box office revenue for the first half of the year reached 29.231 billion yuan, with 641 million moviegoers, marking year-on-year increases of 22.91% and 16.89% respectively [3] - Domestic films accounted for 91.2% of the box office, with the film "Nezha: Birth of the Demon Child" contributing over 15.4 billion yuan, representing a significant portion of the total box office [3] - Wanda Film reported a domestic box office of 4.21 billion yuan, a year-on-year increase of 19.2%, with 82.39 million attendees, up 9.6% [3] Group 2: Business Optimization - Companies are enhancing their business models by optimizing consumption scenarios, improving sales conversion rates, and expanding external channels [6] - Wanda Film has upgraded its sales strategies through social media and live streaming, while also focusing on self-developed products and eliminating underperforming items [6] - Golden Screen Cinemas reported a 48% increase in sales of new beverage products and a 178% increase in light food sales, indicating a successful expansion of their product line [6][8] Group 3: Cost Control - Cost control measures have been crucial for maintaining profitability, with Golden Screen Cinemas reporting reductions in various operational costs, including travel and marketing expenses [8] - The company has optimized energy usage and maintenance costs, leading to a 5.82% decrease in overall operating costs [8] - The focus on innovative business models, such as "Cinema+" and "Space+", aims to enhance operational efficiency and revenue generation [8] Group 4: Future Outlook - The market is expected to experience a slowdown post-summer, but the upcoming National Day holiday may drive new growth [8] - Major companies like Wanda Film and Light Media are likely to maintain strong performance through participation in key projects, while less competitive firms may continue to face challenges [8][9]

Core Viewpoint - The article discusses the recent changes in the ownership structure of Wanda Film, highlighting the transfer of control from Wang Jianlin to Ke Liming through the sale of shares in Beijing Wanda Investment and the implications for the company's future [3][4]. Group 1: Ownership Changes - In April 2024, Wang Jianlin sold his controlling stake in Wanda Film for approximately 2.155 billion RMB, resulting in Ke Liming becoming the actual controller of the company [3][4]. - Ke Liming's companies, Shanghai Ruyi Film Production and Shanghai Ruyi Investment, had their shares frozen for three years, which may impact their financial activities [2]. - Following the share transfer, Ruyi Investment holds 51% of Beijing Wanda Investment, which in turn controls 20.64% of Wanda Film [4]. Group 2: Shareholder Actions - The shareholder Shinxian Rongzhi plans to reduce its stake in Wanda Film by up to 3%, marking its first significant reduction [5]. - Alibaba's affiliate, Hangzhou Zhenxi Investment, has also been reducing its holdings in Wanda Film, decreasing its stake to approximately 4.999995% [5]. Group 3: Financial Performance - Wanda Film reported a revenue of 6.689 billion RMB for the first half of 2025, reflecting a year-on-year growth of 7.57%, with a net profit of 536 million RMB, a significant increase of 372.55% [6]. - The company maintained its position as the box office champion for 16 consecutive years, with notable increases in the number of top-performing cinemas [6]. Group 4: Market Performance - As of September 1, 2025, Wanda Film's stock closed at 11.64 RMB per share, with a total market capitalization of 24.58 billion RMB [7].

Group 1 - The core viewpoint of the article is that ST Mingcheng (600136.SH) reported significant growth in revenue and a turnaround in net profit for the first half of the year [1] - The company's operating revenue reached 279 million yuan, representing a year-on-year increase of 596.55% [1] - The net profit attributable to shareholders was 999,000 yuan, indicating a return to profitability compared to the previous year [1] Group 2 - The company reported a non-recurring net loss of 3.37 million yuan, highlighting ongoing challenges despite the overall revenue growth [1] - The basic earnings per share were reported at 0.00 yuan, suggesting limited earnings distribution to shareholders [1]

Core Viewpoint - The company reported a significant turnaround in its financial performance for the first half of 2025, driven by game publishing and content investment, achieving a net profit of 1.228 billion yuan compared to a loss in the previous year [1] Financial Performance - Total revenue for H1 2025 reached 2.206 billion yuan, marking a year-on-year increase of 20% [1] - The gross profit margin was 50.9%, a decrease of 17.8% year-on-year [1] - Operating profit stood at 1.336 billion yuan, reflecting a year-on-year increase of 114% [1] - Other income from fair value changes in financial assets amounted to 480 million yuan, a significant recovery from a loss of 900 million yuan in the same period last year [1] - Adjusted net profit was 1.303 billion yuan, representing a year-on-year increase of 140% [1] Business Segments - Revenue from the gaming segment was 1.21 billion yuan, an increase of 40% year-on-year [1] - Online streaming revenue was 406 million yuan, down 55% year-on-year [1] - Content production revenue reached 570 million yuan, up 19% year-on-year, with a segment profit of 647 million yuan compared to a loss of 310 million yuan in the previous year [1] Content Pipeline and Strategic Investments - Upcoming films include "You Have a Cloud Like You" scheduled for release on August 29, along with several other titles in the pipeline [2] - The company has strategic investments in multiple blue ocean sectors, including acquisitions of 100% of Youai Entertainment and 30% of Yonghang Technology [2] - The gaming portfolio includes successful titles such as "Red Alert OL" and "QQ Dance," with over 6 billion yuan in revenue from "Red Alert OL" since its launch [2] - The company is focusing on expanding its self-developed and published games, as well as investing in IP derivatives and cross-border payment solutions [2]