III 27 LINEKONG 第 － 季 度 報 告 整港互動集團有限公司 Linekong Interactive Group Co , Ltd. ( 於閱曼群島註冊成立的有限公司 ) 股份代號 : 8267 1 2022年第一季度報告 | 藍港互動集團有限公司 香港聯合交易所有限公司（「聯交所」）GEM的特色 GEM的定位，乃為中小型公司提供一個上市的市場，此等公司相比起其他 在聯交所上市的公司帶有較高投資風險。有意投資的人士應了解投資於該 等公司的潛在風險，並應經過審慎周詳的考慮後方作出投資決定。 由於GEM上市公司普遍為中小型公司，在GEM買賣的證券可能會較於主板 買賣的證券承受較大的市場波動風險，同時無法保證在GEM買賣的證券會 有高流通量的市場。 香港交易及結算所有限公司及聯交所對本報告的內容概不負責，對其準確 性或完整性亦不發表任何聲明，並明確表示概不就因本報告全部或任何部 分內容而產生或因倚賴該等內容而引致的任何損失承擔任何責任。 本報告的資料乃遵照香港聯合交易所有限公司GEM證券上市規則（「GEM上 市規則」）而刊載，旨在提供有關藍港互動集團有限公司（「本公司」或「我們」） 的資料；本公司 ...

Company Performance and Financials - The group's revenue for the year ended December 31, 2021, was approximately RMB 85.9 million, a decrease of about 59.5% compared to RMB 211.9 million for the year ended December 31, 2020[31]. - Revenue from online game development and operation was approximately RMB 70.6 million, a decrease of about 38.0% or RMB 43.3 million from the previous year, attributed to the decline in existing games[33]. - Revenue from the licensing and custom web drama business was approximately RMB 15.4 million, a decrease of about 84.3% or RMB 82.6 million compared to RMB 98.0 million in the previous year[34]. - Total revenue for the year ended December 31, 2021, was approximately RMB 70.6 million, a decrease of about 38.1% from RMB 113.9 million in 2020[36]. - Gross profit for the year was approximately RMB 25.3 million, down about 48.6% from RMB 49.2 million in 2020, with a gross margin of 29.4%, an increase of 6.2 percentage points from 23.2%[39]. - Operating loss for the gaming business was RMB 42.5 million, compared to a loss of RMB 30.3 million in 2020, reflecting a deterioration of 40.2%[46]. - The net loss attributable to equity owners for the year was approximately RMB 75.3 million, an increase of about 118.3% from RMB 34.5 million in 2020[50]. - The adjusted net loss for the year ended December 31, 2021, was approximately RMB 69.6 million, an increase of 235.9% compared to RMB 20.7 million for the year ended December 31, 2020[52]. - The company reported a total annual loss of RMB 80.9 million for 2021, which is a 99.9% increase from RMB 40.5 million in 2020[52]. Research and Development - The company continued to increase investment in independent research and development, focusing on products targeted at female mobile game users[10]. - The company will continue to increase investment in independent research and development for both gaming and film industries to ensure long-term development[22]. - Research and development expenses increased by approximately 14.3% to RMB 19.2 million, up from RMB 16.8 million in 2020, indicating a commitment to enhancing R&D investment[42]. Product Development and Launches - The independent game product "Dream Mansion" has completed its development phase and is expected to launch in Q2 2022 after successful testing on domestic Android channels[11]. - The joint-developed AVG+RPG mobile game "Zhen Huan Chuan: Floating Life Dream" has completed testing both domestically and overseas, awaiting launch, targeting the female market with a strong IP[11]. - The company has several high-quality IPs in reserve, with plans to launch multiple new products in 2022, enhancing its product capabilities[11]. - The company plans to strengthen its overseas market exploration in regions such as South Korea, Japan, and North America, while also focusing on female-oriented and casual games[22]. - In 2022, the company expects to launch 1-2 high-quality works, with the web drama "I Like You More Than Just Like" officially in production and "Maya: The Human Realm" successfully completed filming[22]. Market Expansion - The company is deepening its market presence in key overseas regions, including Japan, South Korea, and North America[10]. - The company has strengthened its Japanese publishing team, with all members having experience in top 30 bestselling game products, enhancing its operational capabilities in Japan[11]. - The group is focusing on expanding into the Japanese market, having established a local publishing team in 2019 and secured exclusive rights for the mobile version of the classic ARPG "Ys VIII" for global release[25]. - The company aims to continue developing self-researched games with a focus on IP-oriented, female-oriented, and casual games while actively exploring overseas markets in 2022[30]. Film and Television Segment - The film and television segment has increased its quality IP reserves, aiming to develop key works for release in 2022[10]. - The film and television business has performed well, with series such as "Mr. Gu" and "The Moonlight" achieving notable success and market recognition[11]. - The company is actively pursuing a matrix layout for its film and television business, aiming to enrich its potential IP reserves and promote high-quality drama production[22]. - The modern urban romantic drama "To You, It's More Than Just Like" is currently in production and is expected to premiere in Q4 2022[28]. Employee and Human Resource Management - The company employed 152 staff members as of December 31, 2021, an increase from 141 employees in the previous year[63]. - The total employee compensation for the year was approximately RMB 51.0 million, compared to RMB 47.7 million in 2020[63]. - The company has established health records for employees and provides free annual health check-ups[157]. - The company has developed various training programs tailored to different job roles to enhance employees' professional skills and teamwork capabilities[158]. - The employee training participation rate was 89.89% for other staff, with an average training duration of 9 hours[195]. Corporate Governance - The company has established three board committees: the Remuneration Committee, the Nomination Committee, and the Audit Committee, each with a clear written scope of authority[88]. - The Remuneration Committee reviewed the remuneration of directors and senior management for the year ending December 31, 2021, and deemed it fair and reasonable[89]. - The Nomination Committee evaluated the composition of the board and the independence of non-executive directors, recommending candidates for new director appointments[90]. - The board consists of eight directors with a gender ratio of 6:2, including three independent non-executive directors[95]. - The company has adopted a board diversity policy since December 29, 2014, which was revised on December 27, 2018, considering factors such as gender, age, culture, and professional experience[94]. Environmental, Social, and Governance (ESG) Initiatives - The company has committed to ESG responsibilities and has prepared an ESG report in accordance with the Stock Exchange's guidelines[122]. - The company has established an ESG governance framework to oversee ESG-related risks and opportunities[130]. - The company has implemented energy-saving measures, including the use of high-efficiency appliances and optimizing server operations[139]. - The company has established policies to reduce significant impacts on the environment and natural resources, detailing actions taken to manage these impacts[198]. - The company emphasizes the importance of stakeholder engagement in its ESG management efforts[133]. Risk Management - The company faces significant risks from tightened government regulations in the gaming industry and ongoing global challenges from the COVID-19 pandemic, prompting a focus on high-quality game development and IP reserves[115]. - The company has established an internal control system based on the COSO framework, with clear responsibilities defined for management and the board[111]. - The internal control system aims to manage risks rather than eliminate them, providing reasonable assurance against significant misstatements or losses[110]. Community Engagement and Social Responsibility - The company created multiple job opportunities in the local community, providing a platform for young people to pursue their dreams[190]. - The company received the honor of being a key cultural export enterprise for the 2021-2022 period, awarded by several government departments[190]. - Community investment policies were outlined, focusing on understanding community needs and ensuring business activities consider community interests[199].

Financial Performance - Revenue for the third quarter of 2021 was RMB 20,454,000, a decrease of 12.1% compared to RMB 23,344,000 in the same period of 2020[4] - Gross profit for the nine months ended September 30, 2021, was RMB 24,790,000, down 42.0% from RMB 42,691,000 in the same period of 2020[4] - The company reported a net loss of RMB 9,535,000 for the third quarter of 2021, compared to a net loss of RMB 18,527,000 in the same period of 2020, indicating an improvement of 48.6%[4] - The group reported a total loss of RMB 27,208,000 for the nine months ended September 30, 2021, compared to a profit of RMB 3,642,000 in the same period of 2020, reflecting a significant decline in performance[28] - The company reported a total revenue of RMB 69,136,000 for the nine months ended September 30, 2021, down 47.3% from RMB 130,649,000 in the same period of 2020[4] - The total comprehensive loss for the third quarter of 2021 was RMB 7,268,000, a decrease of 77.7% from RMB 32,668,000 in the same period of 2020[6] - For the nine months ended September 30, 2021, the net loss attributable to owners was RMB 22,424 thousand, compared to RMB 13,510 thousand for the same period in 2020, indicating a 66.1% increase in losses[39] Expenses and Costs - Research and development expenses for the nine months ended September 30, 2021, were RMB 14,402,000, an increase of 34.0% from RMB 10,684,000 in the same period of 2020[4] - The company experienced a significant increase in sales and marketing expenses, which rose to RMB 12,633,000 for the nine months ended September 30, 2021, compared to RMB 8,910,000 in the same period of 2020[4] - The company's cost for the nine months ended September 30, 2021, was approximately RMB 44.3 million, a decrease of about 49.7% from RMB 88.0 million in the same period of 2020[61] Revenue Breakdown - For the nine months ended September 30, 2021, the total revenue from the gaming business was RMB 96,164,000, a decrease from RMB 54,429,000 in the same period of 2020, representing a decline of approximately 44.1%[24] - The total revenue from the film and television business for the nine months ended September 30, 2021, was RMB 34,485,000, down from RMB 14,707,000 in the same period of 2020, indicating a decrease of about 60.5%[28] - Revenue from external customers in China for the nine months ended September 30, 2021, was RMB 38,160,000, down from RMB 75,978,000 in the same period of 2020, a decrease of approximately 49.8%[30] - Game virtual item sales dropped from RMB 79.6 million to RMB 52.3 million, while licensing and technical service fees decreased from RMB 16.5 million to RMB 2.2 million[53] - The film and television business revenue from web drama production and other sources fell from RMB 34.5 million to RMB 14.7 million[54] Shareholder Information - Mr. Wang Feng holds 66,576,160 shares, representing approximately 21.53% of the total share capital[85] - Ms. Liao Mingxiang holds 12,168,720 shares, representing approximately 6.13% of the total share capital[85] - Mr. Wang Jin holds 3,260,000 shares, representing approximately 0.89% of the total share capital[85] - Mr. Chen Hao holds 2,535,841 shares, representing approximately 0.69% of the total share capital[85] - As of September 30, 2021, the total number of issued shares was 367,974,964[101] Strategic Initiatives - The company is focusing on increasing investment in self-developed mobile games and film and television projects to enhance long-term development[42] - The company plans to strengthen its overseas market exploration, particularly in regions such as South Korea, Japan, and North America[42] - The company is actively acquiring quality IPs while continuing to focus on self-development to enhance user reputation and brand effect[44] - The company aims to enhance its game development capabilities and invest in new game operations, with a specific allocation of RMB 20.7 million for this purpose[83] - The company has plans to develop and invest in film and television content, with an allocation of RMB 22.1 million for acquiring related intellectual property rights[83] Corporate Governance - The company has complied with the corporate governance code as per GEM Listing Rules during the nine months ended September 30, 2021[126] - The audit committee was established on April 24, 2014, and is responsible for reviewing financial data, internal controls, and risk management[128] - All directors confirmed compliance with the trading standards for securities as per GEM Listing Rules during the nine months ended September 30, 2021[130]

Financial Performance - The company reported a significant reduction in operating losses for the year 2020, leading to increased investment in self-developed games and film and television projects for long-term growth[10]. - The company's revenue decreased by approximately 54.6% from about RMB 107.3 million in the six months ended June 30, 2020, to about RMB 48.7 million in the same period of 2021[23]. - Game business revenue contributed approximately RMB 37.8 million, a decrease of about 47.3% or RMB 35.2 million compared to the same period last year, primarily due to fewer new game releases and the decline of existing games[26]. - The revenue from the film and television business was approximately RMB 9.4 million, a decrease of about 71.4% from approximately RMB 32.9 million in the same period last year, mainly due to seasonal impacts[27]. - The group's gross profit for the six months ended June 30, 2021, was approximately RMB 20.1 million, a decrease of about 46.5% from RMB 37.6 million for the same period in 2020[30]. - The company's net loss for the three months ended June 30, 2021, was RMB 3,608 thousand, compared to a profit of RMB 5,458 thousand in the same period of 2020, marking a significant turnaround[108]. - The company reported a total revenue of RMB 369,544 thousand for the six months ended June 30, 2021, compared to RMB 447,772 thousand for the same period in 2020, indicating a decline of approximately 17.4%[142]. Game Development and Releases - The game business launched new products such as "Naughty Heaven 2" and is conducting internal technical testing on several titles, with a focus on expanding into overseas markets like South Korea, Japan, and North America[10]. - The MMORPG mobile game "Wild Era" is currently in the technical testing phase, with plans for commercial testing in the second half of 2021[13]. - The AVG+RPG female-oriented mobile game "Zhen Huan Chuan: Floating Life Dream" has entered the later stages of development, promising a rich gameplay experience[13]. - The game "Naughty Heaven 2" incorporates elements of traditional Chinese culture, aiming to attract both new and existing players through its unique gameplay and aesthetic[13]. - The company plans to continue developing self-researched games focusing on IP, female-oriented, and casual games while actively expanding into overseas markets[19]. Film and Television Projects - The urban romance drama "You Are Like This, Mr. Gu" achieved over 100 million views within three days of its release on Tencent Video, indicating strong audience engagement[10]. - The company is actively pursuing a matrix layout in its film and television business, with multiple IP projects in script development, enhancing its content portfolio[10]. - The company has launched six excellent drama series and has several high-quality potential works in reserve, focusing on different content segments[15]. - The company has plans for new projects, including the ancient costume adventure web drama "Cloud Sea Legend," expected to start production in 2021[18]. Financial Position and Cash Flow - As of June 30, 2021, the group had cash and cash equivalents of approximately RMB 85.4 million, compared to RMB 84.7 million as of December 31, 2020[44]. - The total assets as of June 30, 2021, amounted to RMB 557,119 thousand, a decrease from RMB 572,434 thousand as of December 31, 2020, representing a decline of approximately 2.9%[98]. - The company reported a net cash inflow from operating activities of RMB 12,778 thousand for the six months ended June 30, 2021, compared to RMB 14,765 thousand for the same period in 2020, representing a decrease of approximately 13.5%[149]. - The company experienced a net cash outflow from investing activities of RMB 7,142 thousand, a significant decrease from a net inflow of RMB 102,833 thousand in the previous year[148]. - The total cash and cash equivalents at the end of the period were RMB 85,379 thousand, down from RMB 161,678 thousand at the end of the previous year, indicating a decrease of approximately 47.3%[150]. Shareholder Dynamics and Ownership Structure - As of June 30, 2021, the total issued share capital was 367,974,964 shares[60]. - Major shareholders include Zhu Li with 21.53% (79,216,540 shares) and Wangfeng Management Limited with 18.09% (66,576,160 shares) as of June 30, 2021[67]. - The ownership structure indicates a high concentration of equity among a few major shareholders, with the top five shareholders holding over 70% of the total shares[70]. - The company is under the control of significant entities, including Fosun International, which holds 72.14% of Fosun Holdings[71]. - The report highlights the importance of understanding shareholder dynamics for future strategic decisions and market positioning[77]. Employee Compensation and Incentives - The company has adopted a share option scheme to incentivize directors and eligible participants, enhancing employee retention and motivation[50]. - The total employee compensation for the six months ended June 30, 2021, was approximately RMB 26.8 million, an increase of 8.1% from RMB 24.8 million for the same period in 2020[49]. - The company has a vesting schedule for options granted, with 25% vesting after 10 months and 100% after 46 months[83]. Risk Management and Financial Instruments - The company did not experience any changes in risk management policies during the six months ending June 30, 2021[162]. - The fair value of financial assets includes RMB 3,000 thousand in financial products and RMB 55,878 thousand in unlisted securities as of June 30, 2021[165]. - The company utilized various valuation methods to determine the fair value of financial instruments, including market quotes and discounted cash flow models[171].

Financial Performance - For the first quarter of 2021, the company reported unaudited revenue of RMB 20,977,000, a decrease of 64.1% compared to RMB 58,489,000 in the same period of 2020[7]. - The gross profit for the first quarter was RMB 6,425,000, resulting in a gross margin of approximately 30.6%[7]. - The company incurred a net loss of RMB 10,443,000 for the quarter, compared to a profit of RMB 1,523,000 in the first quarter of 2020, indicating a significant decline in profitability[8]. - Basic and diluted loss per share for the quarter was RMB (0.0291), compared to RMB (0.0009) in the same period last year[9]. - The total comprehensive loss for the period was RMB (8,327,000), compared to a comprehensive income of RMB 10,388,000 in the first quarter of 2020[9]. - The total operating loss for the group was RMB 9,174,000, compared to an operating profit of RMB 2,856,000 in the same period of 2020[23]. - The group's revenue decreased by approximately 64.1% to about RMB 21.0 million for the three months ended March 31, 2021, compared to approximately RMB 58.5 million for the same period in 2020[47]. - The group incurred a net loss of approximately RMB 10.4 million for the three months ended March 31, 2021, compared to a profit of approximately RMB 1.5 million for the same period in 2020[58]. - The adjusted net loss for the three months ended March 31, 2021, was approximately RMB 10.1 million, compared to an adjusted profit of approximately RMB 3.3 million for the same period in 2020[59]. Revenue Breakdown - The gaming business generated revenue of RMB 18,792,000 from virtual goods sales and RMB 733,000 from licensing and technical service fees, down from RMB 25,689,000 and RMB 10,170,000 respectively in the previous year[22]. - The film and television business reported revenue of RMB 1,452,000, significantly down from RMB 22,630,000 in the same period last year[23]. - Revenue from customers in China was RMB 9,660,000, down 77.2% from RMB 42,280,000 in 2020[26]. - Revenue from South Korea was RMB 9,895,000, a decrease of 32.5% compared to RMB 14,588,000 in the previous year[26]. - Game business revenue contributed approximately RMB 19.5 million, a decrease of about 45.6% or RMB 16.4 million year-on-year, due to a decline in revenue from co-operated games and reduced game licensing income[50]. - The revenue from film and television business, including the production and licensing of web dramas, was approximately RMB 1.5 million, down about 93.6% from approximately RMB 22.6 million in the same period last year[51]. Expenses and Costs - The group reported an investment loss of approximately RMB 0.2 million for the three months ended March 31, 2021, a decrease of about 66.7% from RMB 0.6 million for the same period in 2020, mainly due to reduced operational losses from the investee Axie Interactive Entertainment Limited[57]. - The group's cost for the three months ended March 31, 2021, was approximately RMB 14.6 million, a decrease of about 63.5% from approximately RMB 40.0 million in the same period in 2020[52]. - Sales and marketing expenses were approximately RMB 3.2 million, a decrease of about 37.3% from approximately RMB 5.1 million in the same period last year, mainly due to a decline in new game releases[54]. - Administrative expenses were approximately RMB 7.0 million, down about 28.6% from approximately RMB 9.8 million in the same period last year, reflecting a reduction in spending due to business strategy needs[55]. - Research and development expenses were approximately RMB 4.9 million, a decrease of about 7.5% from approximately RMB 5.3 million in the same period last year, primarily due to reduced capital expenditures[56]. Cash and Equity - As of March 31, 2021, the group had cash and cash equivalents of approximately RMB 135.3 million, an increase from RMB 84.7 million as of December 31, 2020[62]. - The group had short-term bank deposits of approximately RMB 52.0 million as of March 31, 2021, down from RMB 90.8 million as of December 31, 2020[62]. - The group’s total bank loans were approximately RMB 100.0 million as of March 31, 2021, unchanged from December 31, 2020[64]. - The debt ratio, calculated as total liabilities divided by total assets, was approximately 32.8% as of March 31, 2021, compared to 31.2% as of December 31, 2020[64]. - The company’s total equity as of March 31, 2021, was RMB 384,375,000, a decrease from RMB 450,567,000 at the beginning of the year[10]. Strategic Focus and Development - The company continues to focus on its gaming and film businesses in China and other regions, aiming for market expansion and new product development[12]. - The gaming business is advancing new product development, with multiple projects entering the late-stage R&D and technical testing phases[36]. - The self-developed game "Coin Tycoon" is currently in global testing, showing good retention and payment data, with plans for domestic version testing to follow[38]. - The MMORPG mobile game "Wild Era" is in technical testing and is expected to start commercialization testing in 2021[38]. - The film division is building a product matrix with a focus on high-quality IP, including major projects like "Qin Se Yuan" and "Yun Hai Chuan," which are set to begin production in 2022[41]. - The group plans to continue developing self-researched businesses focusing on IP, female-oriented content, and casual games while actively expanding into overseas markets[46]. Shareholder Information - The company’s board members and key executives hold significant equity stakes, with Mr. Wang Feng owning 21.51% of the shares[74]. - Major shareholders include Zhu Li with 21.51% (79,216,540 shares) and Wangfeng Management Limited with 18.07% (66,576,160 shares) as of March 31, 2021[86]. - The total number of issued shares as of March 31, 2021, is 368,350,964 shares[95]. - The company aims to enhance shareholder value through strategic initiatives and market expansion[99]. Corporate Governance - The company has adhered to the principles and provisions of the Corporate Governance Code as per GEM Listing Rules Appendix 15 during the three months ending March 31, 2021[111]. - The Audit Committee, established on April 24, 2014, is responsible for reviewing financial data, internal controls, and risk management[112]. - The company has complied with the GEM Listing Rules regarding the composition of the Audit Committee as per Article 5.28[113]. - All directors confirmed compliance with the required trading standards during the three months ending March 31, 2021[114].

Game Development and Strategy - The self-developed casual game "Coin Tycoon" was tested in North America in July 2020 and showed good retention and payment data, with plans for a domestic version test in 2021[25]. - The AVG+RPG female-oriented mobile game "Zhen Huan Chuan: Floating Life Dream" is nearing completion, highlighting the company's focus on the female market with a strong IP and quality[25]. - The company has established a stable operation of the game "Uncharted Waters" in South Korea and is focusing on expanding into the Japanese market, enhancing the local publishing team's capabilities[25]. - The company is focusing on the development of female-oriented mobile games and has made significant progress in this area[25]. - The gaming business has multiple projects in the late development stage, with significant progress expected in 2021 for female-oriented and mid-casual games, alongside deeper strategic layouts in overseas markets such as Korea, Japan, and North America[41]. - The new MMORPG mobile game "The Era of Overlapping Ruins" is currently in technical testing and is expected to start commercialization testing within the year[43]. - The group has established a dedicated team for the Japanese market, which has experience in publishing top-selling games, and has secured exclusive adaptation and global publishing rights for the mobile version of "Ys VII"[44]. - The game "Ys VIII Mobile" received positive feedback during its participation in the Tokyo Game Show and is currently in the late-stage development and optimization phase, with testing expected to start in 2021[47]. - The company aims to enhance its self-developed business in 2021, focusing on female-oriented and casual games while exploring overseas markets[54]. - The company is advancing its global market strategy, particularly in Europe and North America, while continuing to develop its presence in Japan, South Korea, and other overseas markets[24]. Financial Performance - The company reported a significant increase in revenue, achieving a total of $500 million for the fiscal year, representing a 25% year-over-year growth[34]. - User engagement metrics showed a 30% increase in active users, reaching 10 million monthly active users[34]. - The company provided guidance for the next fiscal year, projecting revenue growth of 20% to $600 million[34]. - New product launches are expected to contribute an additional $50 million in revenue, with three major titles scheduled for release in the next quarter[34]. - The group reported a consolidated loss of approximately RMB 40.48 million for the year ended December 31, 2020, a decrease of 19.1% compared to the previous year[56]. - The total revenue for the year decreased by approximately 6.3% compared to the previous year, reflecting the impact of the COVID-19 pandemic on the industry[56]. - Game business revenue contributed approximately RMB 113.9 million, a decrease of about 33.0% from RMB 170.1 million in 2019, attributed to fewer new game releases and existing game decline[62]. - The gross profit for the year was approximately RMB 49.2 million, a decrease of about 30.8% from RMB 71.1 million in 2019, with a gross margin of 23.2%, down 8.3 percentage points from 31.5%[67]. - The operating loss for the game business was RMB 30.3 million, reduced by 32.5% from RMB 44.8 million in 2019, while the film and television business turned a profit of RMB 4.8 million[76]. Film and Television Production - The film and television division has successfully completed the production of "You Are Like This, Mr. Gu" and is set to launch on March 30, 2021, with other major projects in the pipeline[25]. - The film and television business has increased its IP reserves and is implementing a matrix product strategy, with several high-quality series set to be released in 2021[24]. - The group plans to launch 1-2 high-quality film projects in 2021, having entered a matrix layout for film and television production in 2020[41]. - The company plans to launch the ancient costume fantasy drama "琴瑟絲" in 2021, which is the first domestic drama based on ancient music, showcasing traditional culture[49]. - The new web drama "原來你是遠樣的廠先生" was completed in 2020 and is set to premiere on Tencent Video on March 30, 2021, combining light comedy and fashion elements[50]. - The ancient costume romantic drama "花好月又圓" is expected to be released in 2021, developed in collaboration with Youku[50]. - The film and television division has accumulated several high-quality potential projects, ensuring a steady output of head and waist works[48]. Talent and Team Development - The newly established entertainment company, Linekong Chenxi, has signed four young artists, who are actively participating in major productions and have stable fan bases on new media platforms[26]. - The company has strengthened its talent pool and team building for female-oriented and ACG (Anime, Comic, Game) products, with plans to launch multiple high-quality new products in 2021[26]. - The group has signed four potential new stars in its artist management business and has initiated various projects in film and television, as well as new media operations[42]. - The company has a strong lineup of new talent, with several projects scheduled for release in 2021, including "乘風少年" and "一日為囚"[53]. Research and Development - Investment in R&D increased by 40%, focusing on innovative gaming technologies and user experience improvements[34]. - Research and development expenses for the year were RMB 16.83 million, accounting for 7.9% of total expenses, while administrative expenses were RMB 53.25 million, representing 25.1%[56]. - Research and development expenses were approximately RMB 16.8 million, a decrease of about 37.8% from RMB 27.0 million in 2019, due to the company's business stage and strategic needs[70]. Corporate Governance and Compliance - The board of directors confirmed compliance with the GEM Listing Rules regarding corporate governance, ensuring accountability and transparency[111]. - The board consists of 4 executive directors, 1 non-executive director, and 3 independent non-executive directors, maintaining the required independence as per GEM Listing Rules[115]. - The company has established three board committees: the Remuneration Committee, the Nomination Committee, and the Audit Committee, to oversee specific areas of the company's affairs[129]. - The audit committee reviewed the consolidated financial statements for the year ending December 31, 2020, and confirmed compliance with applicable accounting standards and GEM listing rules[141]. - The company has adopted the GEM Listing Rules regarding the trading of securities by directors, ensuring compliance with the trading standards[119]. Sustainability and ESG Initiatives - The management team highlighted a commitment to sustainability, aiming to reduce carbon emissions by 30% over the next five years[34]. - The company is committed to maintaining the accuracy and reliability of its ESG report, which reflects its management measures and performance in environmental, social, and governance aspects for the year 2020[176]. - The ESG report covers information from January 1 to December 31, 2020, focusing on the company's operations in China[177]. - The company emphasizes the importance of stakeholder feedback on its sustainable development management[178]. - The company actively promotes green operations and adheres to environmental protection laws, including the Energy Conservation Law of the People's Republic of China[186]. - The company implemented a paperless office policy, promoting the reuse of paper and encouraging environmental awareness among employees[190]. - The total greenhouse gas emissions amounted to 264.31 tons, with scope 1 emissions at 8.49 tons and scope 2 emissions at 255.81 tons[195]. - The company encourages the use of public transportation to enhance energy efficiency[190]. - The company has replaced high-energy-consuming equipment with energy-efficient products in its offices[187]. Market Expansion and Strategy - The company is expanding its market presence in Southeast Asia, targeting a 15% market share within the next two years[34]. - A strategic acquisition of a smaller gaming studio was completed, expected to enhance the company's development capabilities and add new IPs[34]. - The gaming industry continues to face challenges due to resource concentration among leading companies and tightening licensing policies, prompting the company to focus on high-quality game development and expand into stable markets like South Korea and Japan[166]. - The company is closely monitoring domestic policies that may impact its gaming and film businesses and is prepared to adjust its development strategy accordingly[169].

Financial Performance - Revenue for the nine months ended September 30, 2020, was approximately RMB 130.6 million, a decrease of about 22.5% compared to RMB 168.5 million for the same period in 2019[5] - The loss for the nine months ended September 30, 2020, was approximately RMB 11.5 million, an increase of 10.6% from a loss of RMB 10.4 million in the same period of 2019[5] - Adjusted net profit for the nine months ended September 30, 2020, was approximately RMB 3.8 million, compared to an adjusted net loss of RMB 7.5 million for the same period in 2019[5] - The company reported a gross profit of RMB 42.7 million for the nine months ended September 30, 2020, down from RMB 60.5 million in the same period of 2019[6] - Operating loss for the nine months ended September 30, 2020, was RMB 3.6 million, a significant improvement from an operating loss of RMB 17.3 million in the same period of 2019[6] - The company experienced a net loss of RMB 18.5 million for the three months ended September 30, 2020, compared to a net loss of RMB 5.6 million for the same period in 2019[6] - The company’s total comprehensive loss for the nine months ended September 30, 2020, was RMB 19.0 million, compared to a total comprehensive income of RMB 5.7 million for the same period in 2019[13] Revenue Breakdown - The gaming business generated revenue of RMB 96,164,000 for the nine months ended September 30, 2020, down from RMB 131,226,000 in the same period of 2019, reflecting a decrease of about 26.7%[36] - The film and television business reported revenue of RMB 34,485,000 for the nine months ended September 30, 2020, compared to RMB 37,296,000 in the same period of 2019, indicating a decline of approximately 4.3%[37] - Revenue from China for the nine months ended September 30, 2020, was RMB 75,978,000, down from RMB 100,045,000 in the same period of 2019, a decrease of approximately 24.1%[40] - Revenue from South Korea for the nine months ended September 30, 2020, was RMB 47,151,000, a decrease from RMB 53,977,000 in the same period of 2019, representing a decline of about 12.5%[40] Expenses and Cost Management - Research and development expenses for the nine months ended September 30, 2020, were RMB 10.7 million, down from RMB 21.9 million in the same period of 2019[6] - The company's cost for the nine months ended September 30, 2020, was approximately RMB 88.0 million, a decrease of about 18.6% compared to RMB 108.1 million for the same period in 2019[66] - Sales and marketing expenses for the nine months ended September 30, 2020, were approximately RMB 8.9 million, a decrease of about 63.5% from RMB 24.4 million in the same period of 2019[69] - Administrative expenses for the nine months ended September 30, 2020, were approximately RMB 28.6 million, down 15.7% from RMB 33.9 million in the same period of 2019[70] Shareholder Information - As of September 30, 2020, the total number of issued shares is 368,730,964[102] - Major shareholder Zhu Li holds 79,216,540 shares, representing 21.48% of the total[99] - Starwish Global Limited holds 52,318,760 shares, representing 14.19% of the total[99] - Fosun International Holdings Limited also holds 52,318,760 shares, representing 14.19% of the total[102] - Mr. Wang holds 66,576,160 shares through Wangfeng Management Limited, representing an 18.06% stake[99] - Ms. Liao holds 12,168,720 shares through Liaomingxiang Holdings Limited, representing a 3.30% stake[102] Strategic Initiatives - The company plans to expand its market presence in China and other regions through its gaming and film businesses[23] - The company is focused on developing new technologies and products in the gaming sector to enhance user engagement[23] - The company aims to achieve profitability in the upcoming quarters by optimizing operational efficiencies and expanding its product offerings[23] - The company plans to release 1-2 high-quality works in the fourth quarter of 2020, with preparations already underway[49] - The company has established a Japanese publishing team to deepen its market presence in Japan, following its success in South Korea[51] Share Repurchase and Capital Management - The company has implemented a share repurchase plan to manage its capital structure effectively[20] - On July 2, 2020, the company repurchased 200,000 shares, representing approximately 0.054% of the total issued shares, at a maximum price of HKD 0.42 and a minimum price of HKD 0.39[124] - The total purchase price for the repurchased shares was approximately HKD 78,955, funded from internal resources without utilizing any funds raised from the listing[124] - The board believes that the share value is continuously underestimated and that the company's current financial resources allow for share repurchases while maintaining a stable financial condition for ongoing operations[126] Corporate Governance - The company has adhered to the principles and code provisions of the Corporate Governance Code as per GEM Listing Rules Appendix 15[127] - The Audit Committee was established on April 24, 2014, and is responsible for reviewing financial information, internal control procedures, and risk management systems[128] - The company has complied with GEM Listing Rule 5.28 regarding the composition of the Audit Committee[129] - The company has adopted the trading standards for directors as per GEM Listing Rules 5.48 to 5.67 and confirmed compliance for the nine months ending September 30, 2020[130]

LINEKONG 中 期 報 告 整港互動集團有限公司 Linekong Interactive Group Co.,Ltd. ( 於閱曼群島註冊成立的有限公司 ) 股份代號 : 8267 1 2020中期報告 | 藍港互動集團有限公司 香港聯合交易所有限公司（「聯交所」）GEM的特色 GEM為相比起其他在聯交所上市的公司有較高投資風險的中小型公司提供 一個上市的市場。有意投資的人士應了解投資該等公司的潛在風險，並應 經過審慎周詳的考慮後方作出投資決定。 由於GEM上市公司一般為中小型公司，在GEM買賣的證券可能會較於聯交 所主板買賣的證券有更大的市場波動風險，同時無法保證在GEM買賣的證 券會形成流通市場。 香港交易及結算所有限公司及聯交所對本報告的內容概不負責，對其準確 性或完整性亦不發表任何聲明，並明確表示概不就因本報告全部或任何部 分內容而產生或因倚賴該等內容而引致的任何損失承擔任何責任。 本報告的資料乃遵照香港聯合交易所有限公司GEM證券上市規則（「GEM上 市規則」）而刊載，旨在提供有關藍港互動集團有限公司（「本公司」或「我們」） 的資料；本公司董事（「董事」）願就本報告的資料共同及個別地承擔全部 ...

INEKONG 第 － 季 度 報 告 藍港互動集團有限公司 Linekong Interactive Group Co.,Ltd. ( 於開曼群島註冊成立的有限公司 ) 股份代號 : 8267 1 2020年第一季度報告 | 藍港互動集團有限公司 香港聯合交易所有限公司（「聯交所」）GEM的特色 分內容而產生或因倚賴該等內容而引致的任何損失承擔任何責任。 的資料；本公司的董事（「董事」）願就本報告的資料共同及個別地承擔全部 GEM的定位，乃為中小型公司提供一個上市的市場，此等公司相比起其他 在聯交所上市的公司帶有較高投資風險。有意投資的人士應瞭解投資於該 等公司的潛在風險，並應經過審慎周詳的考慮後方作出投資決定。 由於GEM上市公司普遍為中小型公司，在GEM買賣的證券可能會較於主板 買賣的證券承受較大的市場波動風險，同時無法保證在GEM買賣的證券會 有高流通量的市場。 香港交易及結算所有限公司及聯交所對本報告的內容概不負責，對其準確 性或完整性亦不發表任何聲明，並明確表示概不就因本報告全部或任何部 本報告的資料乃遵照香港聯合交易所有限公司GEM證券上市規則（「GEM上 市規則」）而刊載，旨在提供有關藍港互動 ...

Financial Performance - In 2019, the company faced a challenging market environment in the entertainment industry, leading to a revenue decline but a significant reduction in losses[26]. - The company reported a significant narrowing of losses in the fiscal year 2019, indicating a positive adjustment for long-term development[40]. - Total revenue for the year ended December 31, 2019, was RMB 170,050,000, a decrease of approximately 49.1% from RMB 334,160,000 in 2018[57]. - Revenue from self-developed games was RMB 58,885,000, accounting for 34.6% of total revenue, while agency games generated RMB 111,165,000, making up 65.4%[57]. - Gross profit for the year was RMB 71,100,000, down approximately 58.5% from RMB 171,400,000 in 2018, with a gross margin of 31.5% compared to 37.4% in the previous year[63]. - The company reported a net loss attributable to owners of RMB 108,700,000 for the year, a decrease of approximately 34.9% from RMB 166,900,000 in 2018[77]. - The adjusted net loss for the year ended December 31, 2019, was approximately RMB 43.1 million, a decrease of 53.9% compared to the adjusted net loss of RMB 93.7 million for the year ended December 31, 2018[79]. Gaming Sector Developments - The company's main business in the gaming sector focused on exploring overseas markets, particularly in Japan and South Korea, while increasing development of female-oriented mobile games and casual games[26]. - The tightening of licensing policies and increased competition in the gaming industry posed significant challenges to the company's growth[26]. - The self-developed game "Gong Er Tian Gong" launched on March 28, 2019, received nearly 10 million registered players and topped various app store charts[27]. - The company has established a casual game development team to enhance competitiveness in the casual gaming market, focusing on ultra-casual, mid-casual, strategy, and female-oriented games[27]. - The company continues to expand in overseas markets, with a Korean subsidiary established in 2014 and the recent launch of the Korean version of "Yi Meng Jiang Hu" on March 18, 2019[27]. - The company aims to maintain a premium strategy in its gaming business while launching several self-developed products in the domestic market in 2020[29]. - The company is set to begin production on various projects, including adaptations of popular works and original content, in 2020[29]. - The company is focusing on enhancing its product portfolio by forming a casual game development team targeting ultra-casual, mid-core casual, strategy, and female-oriented games[42]. - The company plans to deepen its overseas market presence, with Japan identified as the second key market after Korea, supported by a team with experience in top 30 Japanese products[43]. - The company's gaming titles, including "The Road to the Ocean" and "Dawn of Light," continue to contribute profits, with ongoing global promotion efforts[43]. Film and Television Segment - The company enhanced its talent acquisition and training in the film and television sector, enriching its IP reserves to support future project development[26]. - The film and television division, "Blue Harbor Pictures," has rapidly developed, with successful releases such as "I and Your Light Year Distance 2" and upcoming projects like "As a Fat Person" and "The Original You Are Mr. Gu" planned for 2020[27]. - In 2019, the company's film and television segment confirmed revenue of approximately RMB 56 million, a decrease of about 54.7% compared to RMB 123.6 million in 2018, primarily due to production delays[54]. Operational Strategy - The company adopted a cautious operational strategy in response to market conditions, which is expected to facilitate long-term development[26]. - The company plans to deepen its focus on key markets like Korea and Japan while continuing to explore the commercial value of its IPs[29]. - The company is entering a matrix layout phase in 2020, focusing on continuous development of key products and has several high-quality content reserves[45]. - The company has implemented strategies to reserve more time for enhancing game quality and launching competitive titles[53]. Employee and Governance - The total employee compensation for the year ended December 31, 2019, was approximately RMB 75.3 million, down from RMB 147.5 million in 2018, reflecting a strategic reduction in workforce[94]. - The group had a total of 175 employees as of December 31, 2019, a decrease from 284 employees as of December 31, 2018, primarily due to the need for efficiency improvements[93]. - The board of directors consists of 4 executive directors, 1 non-executive director, and 3 independent non-executive directors, complying with GEM listing rules[110]. - The company has established three board committees: the Remuneration Committee, the Nomination Committee, and the Audit Committee, to oversee specific areas of governance[124]. - The company has adopted a board diversity policy since December 29, 2014, which was revised on December 27, 2018, considering factors such as gender, age, culture, and professional experience in board composition[133]. Risk Management and Internal Control - The company emphasizes the importance of risk management and has set clear objectives to identify and analyze risks[155]. - The internal audit function is tasked with evaluating the effectiveness of risk management and internal control systems[155]. - The audit committee has confirmed that the consolidated financial statements for the year ending December 31, 2019, comply with applicable accounting standards and GEM listing rules[135]. - The company is committed to continuous improvement in its internal control systems, with ongoing evaluations of major risks and compliance measures[159]. Environmental and Social Responsibility - The company has implemented resource-saving measures, including promoting paper reuse and energy-efficient office equipment[183]. - The company encourages green commuting and the use of public transportation to enhance energy efficiency[183]. - The company has established communication mechanisms with stakeholders, including government, shareholders, employees, and customers, to address ESG concerns[176]. - The company actively promotes sustainable development principles in its operations, contributing to global sustainability efforts[182].