Revenue and Profitability - Revenue for the six months ended June 30, 2024, was RMB 686.3 million, a decrease of 5.2% compared to the same period last year[2] - Subscription solution revenue decreased by 10.6% to RMB 377.5 million, while merchant solution revenue increased by 2.2% to RMB 306.6 million[2] - Gross profit decreased by 6.4% to RMB 469.1 million, with subscription solution gross profit down 14.2% to RMB 295.6 million and merchant solution gross profit up to RMB 173.6 million[2] - Gross margin decreased from 69.2% to 68.4%, with subscription solution margin dropping from 81.5% to 78.3% and merchant solution margin increasing from 52.1% to 56.2%[3] - Operating profit for the period was RMB 2.6 million, a significant improvement from an operating loss of RMB 11.3 million in the same period last year[3] - Net loss for the period was RMB 4.3 million, compared to a net loss of RMB 18.4 million in the same period last year[5] - Total comprehensive loss for the period was RMB 7.1 million, an improvement from RMB 12.8 million in the same period last year[9] - Total revenue for the first half of 2024 was RMB 686,329 thousand, a decrease from RMB 724,294 thousand in the same period of 2023[20][24] - Revenue from subscription solutions decreased to RMB 377,489 thousand in 2024 from RMB 422,266 thousand in 2023[24] - Revenue from merchant solutions increased slightly to RMB 306,639 thousand in 2024 from RMB 300,029 thousand in 2023[24] - Other revenue remained relatively stable at RMB 2,201 thousand in 2024 compared to RMB 1,999 thousand in 2023[24] - The company reported a pre-tax loss of RMB 6,764 thousand for the first half of 2024[20] - Total investment and other income decreased to RMB 19.636 million in the first half of 2024, down from RMB 30.429 million in the same period of 2023[27] - The company's total revenue for the first half of 2024 was approximately RMB 686.329 million, a decrease of 5.2% compared to the same period in 2023[54] - Subscription solution revenue decreased by 10.6% to RMB 377.489 million, primarily due to a reduction in the number of paying merchants[56] - Merchant solution revenue increased by 2.2% to RMB 306.639 million, consistent with the growth rate of GMV[56] - Other business revenue increased by 10.1% to RMB 2.201 million[56] - Gross profit decreased by 6.4% to RMB 469,149 thousand, with gross margin dropping from 69.2% to 68.4%, mainly due to a decline in subscription solution gross profit[59] - Subscription solution gross profit decreased by 14.2% to RMB 295,593 thousand, with gross margin dropping from 81.5% to 78.3%[60] - Merchant solution gross profit increased by 10.1% to RMB 172,258 thousand, with gross margin rising from 52.1% to 56.2% due to optimized cost structure[61] - Adjusted EBITDA increased significantly to RMB 51,219 thousand from RMB 6,321 thousand in the previous year[63] - Adjusted non-HKFRS profit rose to RMB 57,017 thousand from RMB 22,515 thousand in the previous year[64] Cash Flow and Financial Position - Cash and cash equivalents totaled RMB 839.5 million as of June 30, 2024, with a current ratio of 1.07[3] - Net cash used in operating activities was RMB 68,244 thousand for the six months ended June 30, 2024, compared to RMB 7,317 thousand for the same period in 2023[15] - Net cash used in financing activities was RMB 13,082 thousand for the six months ended June 30, 2024, down from RMB 43,487 thousand for the same period in 2023[15] - Cash and cash equivalents decreased by RMB 82,467 thousand for the six months ended June 30, 2024, compared to a decrease of RMB 51,244 thousand for the same period in 2023[15] - Cash and cash equivalents stood at RMB 839,499 thousand as of June 30, 2024, down from RMB 924,998 thousand at the end of 2023[65] Assets and Liabilities - Total assets as of June 30, 2024, were RMB 5.76 billion, with current assets of RMB 4.29 billion and non-current assets of RMB 1.47 billion[10] - Total current liabilities increased to RMB 4,017,118 thousand as of June 30, 2024, compared to RMB 3,664,103 thousand as of December 31, 2023[11] - Contract liabilities decreased to RMB 571,046 thousand as of June 30, 2024, from RMB 585,578 thousand as of December 31, 2023[11] - Net current assets stood at RMB 1,743,277 thousand as of June 30, 2024, slightly up from RMB 1,730,911 thousand as of December 31, 2023[11] - Total non-current liabilities decreased to RMB 719,756 thousand as of June 30, 2024, from RMB 722,021 thousand as of December 31, 2023[11] - Net assets increased to RMB 1,023,521 thousand as of June 30, 2024, compared to RMB 1,008,890 thousand as of December 31, 2023[11] - The company's equity attributable to owners of the parent was RMB 1,023,032 thousand as of June 30, 2024, up from RMB 1,021,330 thousand as of December 31, 2023[11] - The company's total equity increased to RMB 1,023,521 thousand as of June 30, 2024, from RMB 1,008,890 thousand as of December 31, 2023[11] - The company's total assets increased to RMB 4,759,842 thousand as of June 30, 2024, from RMB 4,417,029 thousand as of December 31, 2023[21] - Total liabilities increased to RMB 4,440,831 thousand as of June 30, 2024, from RMB 4,059,388 thousand as of December 31, 2023[23] - The company's asset-to-liability ratio decreased to 8.1% from 8.7% at the end of 2023, primarily due to an increase in total assets[65] Business Performance and Strategy - The total GMV generated by merchants through the company's solutions reached approximately RMB 49.9 billion, a year-on-year increase of 2%[53] - Store SaaS business GMV was approximately RMB 25 billion, accounting for 50% of the total GMV, with a year-on-year growth of 7%[53] - The average sales per merchant in the first half of 2024 was approximately RMB 840,000, a year-on-year increase of 25%[53] - As of June 30, 2024, the company had 59,541 paying merchants, with 66% subscribing to e-commerce SaaS and 34% subscribing to store SaaS[53] - The company added 9,116 new paying merchants in the first half of 2024, with 62% subscribing to e-commerce SaaS and 38% subscribing to store SaaS[53] - Business strategy: The company has evolved from providing "digital software" for small and medium-sized merchants to offering "intelligent consumer operation systems" for brand retailers, covering the entire business process from public to private domains and final sales conversion[51] Expenses and Costs - Research and development expenses decreased to RMB 93.828 million in the first half of 2024, compared to RMB 105.840 million in the same period of 2023[28] - Intangible assets amortization remained stable at RMB 40.467 million in the first half of 2024, slightly down from RMB 40.563 million in 2023[29] - Total sales cost decreased by 2.6% to RMB 217,180 thousand, primarily due to a 12.4% reduction in labor costs to RMB 52,510 thousand and a 10.3% decrease in transaction costs to RMB 77,146 thousand[58] - Sales and distribution expenses decreased by 19.7% to RMB 265,763 thousand, mainly due to reduced sales personnel costs and channel commission expenses[62] Taxation and Dividends - The company's effective tax rate in Hong Kong remained at 16.5% for both 2024 and 2023[30] - Two subsidiaries of the company maintained a preferential income tax rate of 15% due to their high-tech enterprise status[31] - The company did not recommend an interim dividend for the first half of 2024, consistent with the same period in 2023[32] - No dividend was recommended for the six months ended June 30, 2024, consistent with the previous year[65] Shareholder and Equity Information - The company's basic loss per share was RMB 17.224 million in the first half of 2024, compared to a profit of RMB 18.114 million in the same period of 2023[34] - Zhu Ning, the company's director, holds a 22.54% equity interest in the company through various entities[69] - Cui Yusong, another director, holds a 2.25% equity interest in the company[69] - Whitecrow Investment Ltd., a company wholly owned by Zhu Ning, holds a 17.42% equity interest in the company[72] - The company's major shareholders include Whitecrow Investment Ltd., Double Peace Limited, and Tricor Equity Trustee Limited, each holding a 17.42% equity interest[72] - Other significant shareholders include Qima Teamwork Inc. (5.78%) and Tembusu HZ II Limited (5.21%)[72] Share Options and Rewards - The company terminated its 2019 Share Option Plan on June 29, 2023, but existing options remain valid and exercisable under the plan's terms[73] - The total number of shares available for issuance under the 2019 Share Option Plan as of June 30, 2024, is 254,852,000 shares, representing 0.77% of the total issued shares (excluding treasury shares)[75] - The weighted average closing price of shares immediately before the vesting date of share options during the six months ended June 30, 2024, was HKD 0.089 per share[75] - The Seventh Reward granted on January 15, 2023, includes 2,195,488 reward shares fully vested on January 14, 2024, and 3,132,000 reward shares divided into three batches, with 50% vesting after one year of continuous service[78] - The Eighth Reward granted on April 1, 2023, includes 2,747,800 reward shares fully vested on March 31, 2024, and 12,131,000 reward shares divided into four batches, with 20% vesting after one year of continuous service[78] - The Ninth Reward granted on July 1, 2023, is divided into four batches, with 25% vesting after one year of continuous service[78] - The weighted average closing price of reward shares immediately before the vesting date during the six months ended June 30, 2024, was HKD 0.08 per share[79] - No share rewards were granted during the six months ended June 30, 2024, under the Share Reward Plan[79] - The number of share rewards available for grant under the Share Reward Plan was zero as of both January 1, 2024, and June 30, 2024[79] - The 2023 Share Option Plan was adopted on June 29, 2023, and no options were granted, exercised, canceled, or lapsed under this plan as of June 30, 2024[76] - The number of options available for grant or issuance under the 2023 Share Option Plan was zero as of both January 1, 2024, and June 30, 2024[76] - The company completed the acquisition of approximately 48.10% equity in Youzan Technology Group on December 29, 2023, resulting in the conversion of Plan A incentive shares into 1,906,330,379 shares[81] - Plan A incentive shares totaling 272,771,297 were granted during the period, with a fair value of HK0.08 during the six months ended June 30, 2024[83] - The number of shares available for grant under Plan A was 1,906,330,379 as of January 1, 2024, and 1,633,559,082 as of June 30, 2024[83] Corporate Governance and Compliance - The company deviated from the Code Provision C.2.1 of the Corporate Governance Code by appointing Mr. Zhu Ning as both Chairman and CEO since February 19, 2021[85] - The Audit Committee reviewed the unaudited condensed interim results for the six months ended June 30, 2024, and found them in compliance with applicable accounting standards and GEM Listing Rules[85] Related Party Transactions - Outstanding balances with related parties: As of June 30, 2024, the receivables from related companies were RMB 55k (Company A), RMB 18k (Company B), and RMB 518k (Company C), compared to RMB 187k (Company B) and RMB 151k (Company C) as of December 31, 2023[41] - Payables to related parties: As of June 30, 2024, the payables to related companies were RMB 377k (Company A and C), compared to RMB 127k as of December 31, 2023[42] - Total compensation for key management personnel: RMB 8,122k for the six months ended June 30, 2024, compared to RMB 8,979k for the same period in 2023[43] Financial Instruments and Fair Value - Fair value of financial instruments: The fair value of financial assets measured at fair value through profit or loss was RMB 282,494k, and through other comprehensive income was RMB 66,367k as of June 30, 2024[45] Contingent Liabilities and Penalties - The company had no significant contingent liabilities as of June 30, 2024[39] - Administrative penalty: A subsidiary, Beijing Gaohuitong Commercial Management Co., Ltd., was fined RMB 27,874k for违规开展相关支付业务, expected to negatively impact the company's net profit for the year ending December 31, 2024[50] Employee Information - The company's employee count as of June 30, 2024, was 1,582[53] - The company employs approximately 1,582 employees as of June 30, 2024, a decrease from 1,750 employees as of December 31, 2023[66] Investments and Acquisitions - The company has no significant investments, acquisitions, or disposals of subsidiaries, associates, or joint ventures during the six months ended June 30, 2024[67] - The company has no specific plans for significant investments or capital asset purchases as of June 30, 2024[67] - The company did not purchase, sell, or redeem any listed securities during the six months ended June 30, 2024[83] Accounts Receivable and Payable - Accounts receivable within 3 months decreased to RMB 13.200 million as of June 30, 2024, down from RMB 21.549 million as of December 31, 2023[36] - Total accounts payable increased significantly to RMB 7.873 million as of June 30, 2024, up from RMB 2.571 million as of December 31, 2023[37] Geographic Revenue Distribution - The majority of revenue came from Mainland China, contributing RMB 682,692 thousand in 2024[25] - Revenue from Japan and North America was minimal, contributing RMB 210 thousand and RMB 3,427 thousand respectively in 2024[25]
中国有赞(08083) - 2024 - 中期财报