IGG(00799)2024-09-12 08:53Financial Performance - The company reported a revenue of HKD 2,735,274,000 for the six months ended June 30, 2024, representing a 9% increase compared to HKD 2,499,020,000 in the same period of 2023[5]. - The group achieved a profit of HKD 330,945,000 in the first half of 2024, a significant recovery from a loss of HKD 359,798,000 in the previous year[6]. - The main business profit for the period was HKD 356,298,000, compared to a loss of HKD 360,765,000 in the same period last year[5]. - The gross profit for the period was HKD 2.155 billion, representing a 19% increase year-on-year, with a gross margin of 79%[17]. - The total comprehensive income for the period was HKD 298,642,000, which includes other comprehensive losses of HKD 32,303,000[114]. - For the six months ended June 30, 2024, the company reported a profit attributable to equity shareholders of HKD 330,945,000, compared to a loss of HKD 359,798,000 for the same period in 2023, indicating a significant turnaround[133]. Revenue Breakdown - The mobile game "Doomsday: Last Survivors" and "Viking Rise" contributed approximately HKD 500,000,000 and HKD 300,000,000 in revenue, respectively, driving growth[8]. - The APP business generated HKD 400,000,000 in revenue, accounting for 15% of the total revenue, marking a significant recovery after a business transformation[8]. - Revenue distribution by region shows that Asia, Europe, and North America contributed 41%, 34%, and 21% of total revenue, respectively[8]. - Revenue from mobile games was HKD 2,326,208, slightly up from HKD 2,309,934 in the previous year, with significant contributions from titles such as "King of Kingdoms" and "Doomsday: Last Survivors"[122]. Cash Flow and Assets - The group reported a net cash inflow from operating activities of HKD 603 million for the period, compared to a net cash outflow of HKD 44 million in the same period last year[24]. - As of June 30, 2024, the group had a net current asset value of HKD 1.406 billion, an increase from HKD 1.115 billion as of December 31, 2023[23]. - The group has cash and cash equivalents of HKD 1.940 billion as of June 30, 2024, up from HKD 1.470 billion as of December 31, 2023[23]. - Cash generated from operating activities was HKD 583,492,000, a significant improvement from cash used in operations of HKD 47,998,000 in the previous year[116]. - Cash and cash equivalents totaled HKD 1,940,320,000 as of June 30, 2024, up from HKD 1,481,464,000 at the end of June 2023[117]. Expenses and Cost Management - Sales and distribution expenses decreased by 20% to HKD 1.221 billion, attributed to a shift in promotional strategy as games gained traction[19]. - Research and development expenses were reduced by 21% to HKD 395 million, reflecting ongoing optimization of existing teams[20]. - Employee costs totaled HKD 462,715 for the six months ended June 30, 2024, down from HKD 541,339 in the previous year, reflecting a reduction in salaries and benefits[127]. - Total advertising and promotion expenses decreased to HKD 1,193,878,000 from HKD 1,483,886,000, reflecting a reduction of approximately 19.5% year-over-year[129]. Dividends and Share Repurchase - The company declared an interim dividend of HKD 0.085 per share, which accounts for 30% of the profit for the first half of 2024[6]. - The board declared an interim dividend of HKD 0.085 per share, totaling approximately HKD 100 million, marking a return to dividend payments after no dividends were declared in the same period last year[29]. - The company repurchased shares totaling nearly HKD 33,000,000 in the first half of 2024, which, along with dividends, accounted for 40% of the half-year profit[6]. - The company repurchased a total of 9,895,000 shares at a total cost of HKD 32,862,730, with all repurchased shares being canceled[91]. Investments and Financial Assets - The group experienced a slight loss of HKD 25,353,000 in investment-related activities due to fair value changes[6]. - The group reported a net income of HKD 8 million from associated companies, a 22% increase compared to HKD 6.5 million in the previous year[20]. - The group reported a net loss of HKD 45,345 from fair value losses on investments for the six months ended June 30, 2024, compared to a loss of HKD 7,775 in the same period last year[126]. - The fair value of financial assets and liabilities as of June 30, 2024, included bonds and other investments valued at HKD 17,612,000 and listed equity securities at HKD 4,827,000[168]. Corporate Governance - The group has maintained a high level of corporate governance, with the board consisting of five executive directors, one non-executive director, and three independent non-executive directors[40]. - The audit committee, composed entirely of independent non-executive directors, has reviewed the interim financial report and confirmed compliance with applicable accounting standards[92]. Structural Contracts and Regulatory Compliance - The company has established a new structural contract with Fuzhou Tianmeng to comply with Chinese laws regarding foreign ownership in value-added telecommunications services[93]. - The company confirmed that the structural contracts have not faced any challenges from Chinese authorities, ensuring uninterrupted operations through Fuzhou Tianmeng and Xinhang Liaokuo[103]. - The company acknowledges that future changes in laws and regulations may impact the recognition of structural contracts as foreign investments, potentially requiring the sale of its interests in Fuzhou Tianmeng and Xinhang Liaokuo[105]. Share Incentive Plans - The company aims to retain and attract talent through its share incentive plan, which does not require performance targets for the shares granted during the six months ending June 30, 2024[62]. - The share incentive plan was adopted on June 29, 2023, aimed at motivating eligible individuals to enhance their contributions to the company[84]. - The total number of shares that can be issued under the share incentive plan is capped at 119,800,659 shares, representing approximately 10.20% of the issued shares as of the report date[85]. - The company has not granted any options or reward shares to directors or senior management during the reporting period[89].