Revenue Performance - Total revenue for the first half of 2022 was RMB 196,400 thousand, a slight decrease of 2.1% year-on-year[10]. - Revenue decreased by 2.1% from RMB 200,538 thousand in H1 2021 to RMB 196,400 thousand in H1 2022, primarily due to a decline in digital goods transaction GMV[53]. - In the first half of 2022, the company achieved revenue of RMB 196,400 thousand and a profit of RMB 33,461 thousand, with adjusted profit attributable to the parent company at RMB 47,158 thousand[27]. - The revenue from the entertainment segment was RMB 109,634 thousand, while the gaming segment generated RMB 32,022 thousand, and the communication segment contributed RMB 13,778 thousand[200]. Segment Performance - The entertainment segment, which accounts for 55.8% of total revenue, achieved a year-on-year growth of 14.3%[14]. - The communication segment experienced a significant revenue decline of 69.9%[14]. - The GMV for the life services segment increased significantly by 134.5% year-on-year, while the entertainment segment saw a slight growth of 5.9%, and the gaming segment experienced a decline of 6.1%[27]. - The corporate welfare segment generated revenue of RMB 20,800 thousand, with a GMV of RMB 221,666 thousand and a gross margin of 84.2%[35]. Profitability - Gross profit for the first half of 2022 was RMB 148,110 thousand, with a gross margin of 75.4%, an increase of 3.0% year-on-year[10]. - Net profit attributable to the parent company was RMB 35,453 thousand, down 51.1% compared to the previous year[10]. - The total profit and comprehensive income decreased by 53.8% to RMB 33,461 thousand, while adjusted profit attributable to the parent company fell by 40.4% to RMB 47,158 thousand[16]. - Operating profit dropped to RMB 36,352 thousand in H1 2022 from RMB 76,120 thousand in H1 2021, reflecting increased costs and expenses[50]. Cash Flow and Financial Position - The net cash generated from operating activities in the first half of 2022 was RMB 107,960 thousand, indicating positive cash flow after the second half of 2021[16]. - Cash and cash equivalents as of June 30, 2022, amounted to RMB 267,974 thousand, compared to RMB 131,582 thousand at the end of 2021, reflecting an increase of 103.5%[103]. - The company reported a significant reduction in operating working capital, with a decrease in prepayments and other receivables by RMB 137,620 thousand[104]. - The total liabilities increased by 35.5% to RMB 289,183 thousand compared to the end of 2021[11]. Strategic Initiatives - The company emphasized the need for sustainable development and cost optimization in response to industry challenges[13]. - The company plans to leverage its supply chain management capabilities to introduce more competitive products in the live e-commerce sector in the second half of 2022[23]. - The strategy for international expansion includes providing localized products for global cross-border consumers, utilizing the overseas live streaming market[24]. - The company aims to replicate its successful domestic strategies in overseas markets through a self-developed supply chain integration platform[24]. Employee and Governance - As of June 30, 2022, the company had 1,036 full-time employees, all based in China[120]. - The company is committed to maintaining high standards of corporate governance and has adopted a corporate governance code[123]. - The audit committee, consisting of three independent non-executive directors, oversees financial reporting and internal control systems[126]. - The company has complied with all applicable provisions of the corporate governance code during the reporting period[124]. Market Environment - The overall market environment has led to a contraction in recruitment demand within the internet sector[13]. - The COVID-19 pandemic has accelerated the digital transformation of the economy, affecting consumer spending and overall market conditions[42]. Research and Development - Research and development costs increased by 47.6% from RMB 17,279 thousand to RMB 25,505 thousand, reflecting the company's strategic investment in SaaS applications and improvements in proprietary platform performance[85]. - The company added 10 new SaaS applications in the first half of 2022, bringing the total to 35, and expanded its supplier network by adding 205 suppliers and 2,431 buyers[41].

Financial Performance - Revenue for 2021 reached RMB 399.283 million, a 21.7% increase from RMB 328.210 million in 2020[10] - Gross profit for 2021 was RMB 295.244 million, up 13.4% from RMB 260.358 million in 2020[10] - Profit before tax decreased to RMB 75.197 million in 2021, down 38.5% from RMB 122.278 million in 2020[10] - Net profit for the year was RMB 68.222 million, a decline of 43.5% compared to RMB 120.898 million in 2020[10] - The adjusted net profit for 2021 was RMB 170 million, up 11.2% from RMB 153 million in 2020, while the net profit decreased by 43.6% to RMB 68 million due to share-based payment expenses of RMB 81 million[21] - Overall gross profit increased by 13.4% from RMB 260,358 thousand in 2020 to RMB 295,244 thousand in 2021, although the gross margin decreased from 79.3% to 73.9%[63] - Operating profit decreased from RMB 127,919 thousand in 2020 to RMB 75,857 thousand in 2021, indicating a decline in operational efficiency[75] - Net profit declined by 43.6% from RMB 120,898 thousand in 2020 to RMB 68,222 thousand in 2021, reflecting the overall financial challenges faced by the company[78] Assets and Liabilities - Total assets as of December 31, 2021, were RMB 1,377.308 million, slightly down from RMB 1,393.825 million in 2020[12] - Current assets increased to RMB 1,343.723 million in 2021, compared to RMB 1,227.986 million in 2020, reflecting a growth of 9.4%[12] - Total equity attributable to the company's owners rose to RMB 1,163.929 million in 2021, up from RMB 1,106.083 million in 2020[12] - The total debt as of December 31, 2021, was RMB 213,379 thousand, a decrease from RMB 287,742 thousand as of December 31, 2020[98] - Cash and cash equivalents at the end of 2021 were RMB 209,445 thousand, down from RMB 457,892 thousand at the end of 2020, representing a decrease of approximately 54.4%[91] - The total capital debt ratio is not applicable as it had no net debt, with cash and cash equivalents significantly exceeding interest-bearing borrowings[100] Revenue Segments - The company's GMV for 2021 was RMB 21.318 billion, a growth of 46.5% compared to RMB 14.553 billion in 2020[22] - The life services segment saw revenue growth of 68.9%, reaching RMB 41 million in 2021 from RMB 24 million in 2020[24] - The entertainment segment's revenue increased by 38.3% to RMB 216 million in 2021 from RMB 156 million in 2020[24] - The communication segment's revenue grew by 72.4% to RMB 81 million in 2021 from RMB 47 million in 2020[25] - The gaming segment's revenue decreased by 39.1% to RMB 62 million in 2021 from RMB 101 million in 2020 due to structural adjustments in response to national policies[25] - Revenue from digital goods-related services increased by 30.5% from RMB 254 million in 2020 to RMB 332 million in 2021[26] - Revenue from value-added services decreased by 8.6% from RMB 74 million in 2020 to RMB 68 million in 2021, with 86.0% of this revenue coming from online store operation services[26] Operational Highlights - The company achieved a net cash inflow from operations of RMB 106 million in the second half of 2021, reversing a trend of cash outflows over the previous two and a half years[21] - The company has established a partnership recruitment program to support clients with funding, market access, product development, training, technology, and after-sales service[17] - The company aims to connect digital goods providers with consumption scenarios, enhancing its revenue generation capabilities[143] - The company is focusing on expanding its business through new product development and market partnerships, particularly in mobile gaming and technology services[130][133] Employee and Management - The company employed 702 full-time employees, all based in China, and offers competitive compensation packages[106] - The management team has extensive experience in the IT industry, with key executives holding over 10 years of relevant experience[110][113][115] - The management team includes experienced professionals with backgrounds in finance, marketing, and technology, indicating a strong strategic direction[124][130] - The company has a dedicated team for technology strategy and research and development, led by a Chief Technology Officer with over 11 years of experience in the field[133] Strategic Initiatives - The company aims to leverage data insights to drive resource optimization and enhance brand operations and marketing growth[14] - The company plans to track the development of the metaverse and explore business opportunities related to NFT applications in 2022[31] - The company is actively pursuing B2B customer development and service expansion, indicating a strategic shift towards enterprise solutions[134] - The company has established an open platform division to enhance upstream supply chain collaboration and e-commerce strategies[136] Shareholder Information - As of December 31, 2021, Mr. Fu Xi holds a total of 164,916,850 shares, representing 40.89% of the issued share capital[185] - Major shareholders include FuXi Limited with 141,094,800 shares (34.98%) and Zhangyuguo Holdings with 45,999,600 shares (11.41%)[194] - The proposed final dividend for the year ended December 31, 2021, is HKD 0.176 per share, subject to shareholder approval[147] Environmental and Regulatory Compliance - The company emphasizes environmental protection and resource conservation, implementing various management measures to reduce carbon emissions[154] - The company has been compliant with relevant environmental laws and regulations, with no known violations during the reporting period[154] - The company is subject to various Chinese laws and regulations regarding foreign investment, which may impact its ability to utilize the proceeds from the listing[158]

| --- | --- | --- | |-----------------------------------------------------------------------|--------|---------------| | | | | | | | | | � | | 线,福强网络 | | | | | | P-CD I | | | | � | PPIK F | 0 0 | | (AD) | | | | Fulu Holdings Limited 福祿控股有限公司 (於開曼群島註冊成立的有限公司) | L | | | | | | | 股份代號： 2101 | | 中期報告 2021 | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | |-------|-------|-----------------------------------------------|-------|-------|-------|-------|-------|-------|-------| | | | | | | | | | | | | ...

Financial Performance - Revenue for 2020 reached RMB 328.21 million, a significant increase from RMB 241.92 million in 2019, representing a growth of approximately 35.6%[10] - Gross profit for 2020 was RMB 260.36 million, up from RMB 193.52 million in 2019, indicating a growth of about 34.5%[10] - The company reported a net profit of RMB 120.90 million for 2020, compared to RMB 80.62 million in 2019, reflecting an increase of approximately 50%[10] - Non-IFRS adjusted net profit for 2020 was RMB 153.21 million, compared to RMB 106.06 million in 2019, indicating a growth of approximately 44.4%[10] - The company's audited net profit attributable to equity holders for the year ended December 31, 2020, was RMB 120.9 million, an increase of 50% compared to the previous year[19] - Operating profit for 2020 was RMB 127,919 thousand, up from RMB 93,292 thousand in 2019[66] - Profit before tax increased by 43% from RMB 85,344 thousand in 2019 to RMB 122,278 thousand in 2020[67] - Adjusted profit for the year ended December 31, 2020, was RMB 153,209 thousand, an increase of 44.4% from RMB 106,060 thousand in 2019[73] Assets and Liabilities - Total assets as of December 31, 2020, amounted to RMB 1.39 billion, a substantial rise from RMB 484.53 million in 2019, marking an increase of around 187%[13] - Total liabilities rose from RMB 231 million as of December 31, 2019, to RMB 288 million as of December 31, 2020[76] - Cash and cash equivalents at the end of 2020 were RMB 457,892 thousand, up from RMB 8,983 thousand at the end of 2019[78] - Total debt increased to RMB 287,742 thousand as of December 31, 2020, from RMB 230,769 thousand as of December 31, 2019[85] - As of December 31, 2020, the company had no net debt, as cash and cash equivalents significantly exceeded interest-bearing borrowings[87] Revenue Breakdown by Segment - The company's GMV for 2020 reached RMB 14,553 million, representing a growth of 13.56% from RMB 12,815 million in 2019[21] - Revenue from the entertainment segment increased by 19% to RMB 155.95 million in 2020, up from RMB 130.52 million in 2019[21] - The gaming segment's revenue rose by 8% to RMB 100.98 million in 2020, with a gross margin improvement from 70% to 82%[21] - The communication segment's revenue surged by 201% to RMB 47.12 million in 2020, driven by increased downstream consumption scenarios[21] - The lifestyle services segment saw a remarkable revenue increase of 929% to RMB 24.16 million in 2020, with gross margin rising from 64% to 93%[22] - Revenue from the value-added services segment grew by 234% to RMB 67.64 million in 2020, accounting for 21% of total revenue[23] Employee and Management - The average age of employees is 29 years, with 25% of the workforce dedicated to research and development, highlighting the company's focus on innovation[16] - The company has a competitive compensation package for employees, including base salary, variable pay, bonuses, and other benefits[92] - The company had 494 full-time employees as of December 31, 2020, all based in China[92] - The company has established a compensation committee to review its compensation policies, ensuring competitive remuneration to attract and retain qualified talent[173] Business Strategy and Market Presence - The company has adopted a unique business model by reducing the initial subscription fee for SaaS software to zero, aiming to lower entry barriers for early customers[16] - The company plans to expand its platform coverage and introduce more digital rights products in 2021, while also focusing on new technologies like blockchain[27] - The company is focused on expanding its business through new product development and strategic partnerships, particularly in the gaming and technology sectors[116][120] - The company has a clear strategy for market expansion, focusing on both domestic and international opportunities in the gaming industry[116][120] Compliance and Governance - The company is committed to maintaining strong governance and compliance standards, as evidenced by the composition of its board of directors[112][113] - The company emphasizes compliance with environmental laws and regulations, ensuring no known violations during the reporting period[132] - The company has complied with applicable laws and regulations in China without any significant non-compliance events[190] Investment and Financing - The company was listed on the Hong Kong Stock Exchange on September 18, 2020, with an offering price of HKD 8.90 per share, raising a total of HKD 890 million from the global offering of 100,000,000 shares[124] - The net proceeds from the IPO amounted to approximately HKD 803.42 million, with specific allocations for various business initiatives outlined[135] - Approximately 30% of the net proceeds (HKD 241.03 million) is allocated to facilitate digital goods transactions and increase the variety of transactions[135] Customer and Supplier Concentration - The company's five largest customers accounted for approximately 54.4% of total revenue for the year ended December 31, 2020, down from 64.5% in 2019, with the largest customer contributing about 18.0% of total revenue[153] - The company's five largest suppliers represented about 52.2% of total purchases for the year ended December 31, 2020, slightly up from 51.9% in 2019, with the largest supplier accounting for approximately 30.0% of total purchases[154]

Financial Performance - Total revenue increased by 30.2% to RMB 158.65 million for the six months ended June 30, 2020, compared to RMB 121.83 million in the same period of 2019[35]. - Adjusted net profit surged by 55.5% to RMB 80.82 million, compared to RMB 51.97 million in the first half of 2019[35]. - Gross profit rose by 38.5% to RMB 132.81 million, with a gross margin of 83.71%, up from 78.74% in the previous year[35]. - Revenue increased by 30.2% from RMB 121,829,000 in H1 2019 to RMB 158,650,000 in H1 2020, driven by increased transaction GMV from online stores[53]. - Profit for the period increased by 37.0% from RMB 51,974,000 to RMB 71,223,000[96]. - Basic and diluted earnings per share increased to RMB 0.24 from RMB 0.17, representing a 41.2% increase[151]. - The revenue from the entertainment segment increased by 21.4% to RMB 75,403,000 for the six months ended June 30, 2020, compared to RMB 62,124,000 for the same period in 2019, driven by an increase in facilitated virtual goods transactions[66]. - The revenue from the gaming segment increased by 19.0% to RMB 58,088,000 for the six months ended June 30, 2020[62]. Asset and Liability Management - Current assets increased by 15.2% to RMB 540.17 million, while total assets rose by 14.4% to RMB 554.31 million[36]. - Total liabilities decreased slightly by 0.6% to RMB 229.32 million, with current liabilities remaining stable[36]. - Net assets attributable to equity holders increased by 28.1% to RMB 324.99 million[36]. - As of June 30, 2020, the total debt amounted to RMB 72,411,000, an increase from RMB 64,127,000 as of December 31, 2019[112]. - The debt-to-equity ratio as of June 30, 2020, was approximately 17%[119]. Operational Highlights - The platform facilitated transactions for over 976 virtual goods providers and 1,616 virtual goods consumption scenarios during the reporting period[41]. - The GMV for entertainment-related virtual goods transactions reached RMB 991.71 million[41]. - GMV for game-related virtual goods transactions totaled RMB 1,106.83 million during the reporting period[42]. - The GMV for communication-related virtual goods transactions reached RMB 5,198,231,000 during the reporting period[46]. - The GMV for life services-related virtual goods transactions totaled RMB 237,892,000[47]. Expenses and Cost Management - Total sales cost for the six months ended June 30, 2020, was RMB 25,837,000, slightly down from RMB 25,904,000 for the same period in 2019[70]. - Commission costs decreased by 9.9% to RMB 14,401,000 for the six months ended June 30, 2020, primarily due to a restructuring of product offerings[75]. - Sales and marketing expenses increased by 54.8% from RMB 16,461,000 to RMB 25,488,000, driven by higher advertising costs on e-commerce platforms[89]. - Administrative expenses surged by 97.6% from RMB 11,038,000 to RMB 21,813,000, mainly due to expenses related to the initial public offering[90]. - Research and development costs grew by 38.5% from RMB 8,869,000 to RMB 12,281,000, reflecting enhanced R&D efforts[91]. Strategic Initiatives - The company plans to expand its virtual goods offerings and enhance IT solutions to strengthen its market position and brand recognition[48]. - The company aims to pursue strategic partnerships, investments, and acquisitions to solidify its leadership position in the industry[48]. - The company aims to expand its market presence and enhance its service offerings in the virtual goods trading sector, leveraging its existing customer base and technological capabilities[167]. Shareholder Information - The company successfully listed on the main board of the Stock Exchange on September 18, 2020, enhancing its capital strength and brand recognition[38]. - The company did not declare any interim dividends for the six months ended June 30, 2020[121]. - The company reported a decrease in finance costs to RMB 3,016 thousand from RMB 4,121 thousand, a reduction of 26.9%[151]. - The company paid dividends of RMB 15,000 thousand during the period, an increase from RMB 9,362 thousand in the same period last year, reflecting a commitment to shareholder returns[164]. Employee and Corporate Governance - The company had 453 full-time employees as of June 30, 2020, all based in China[123]. - The company has not been involved in any significant litigation or arbitration during the reporting period[149]. - The company reported no significant investments as of June 30, 2020[115].