网龙(00777) - 2023 - 年度财报

Financial Performance - In 2023, NetDragon's gaming business revenue rebounded strongly, achieving RMB 3.8 billion, a year-on-year increase of 9.6% compared to a decline of 5.8% in 2022[4]. - Total revenue for 2023 was RMB 7.101 billion, a decrease of 9.7% year-on-year[17]. - Revenue from gaming and application services was RMB 4.189 billion, accounting for 59.0% of total revenue, with a year-on-year growth of 6.6%[17]. - Revenue from Mynd.ai was RMB 2.910 billion, representing a 25.7% decrease year-on-year[17]. - Gross profit for 2023 was RMB 4.398 billion, reflecting a 1.9% increase year-on-year[17]. - Operating profit decreased by 28.6% year-on-year to RMB 821 million[17]. - Profit attributable to the company's owners was RMB 550 million, down 34.1% year-on-year[17]. - Basic earnings per share for 2023 was RMB 103.00, compared to RMB 154.15 in 2022[15]. - Cash flow from operating activities increased by 4.2% year-on-year to RMB 1.1 billion[17]. - Non-GAAP operating profit was RMB 1.1 billion, a decrease of 12.7% year-on-year[17]. Gaming Business Highlights - NetDragon's gaming revenue has increased 3.9 times over the past decade, with nine out of ten years showing revenue growth[4]. - NetDragon's core gaming IPs have shown strong performance, contributing to the overall growth of the gaming business[3]. - Domestic and overseas game revenues grew by 10.5% and 4.5% respectively, with overseas revenue accounting for 15% of total game revenue despite a 5.7% decline in overall overseas revenue for Chinese game developers[21]. - The flagship IP "Magic Domain" achieved a revenue increase of 12.4% to RMB 3.4 billion, with the flagship PC game generating RMB 2.9 billion, a 14% year-on-year growth[21]. - The mobile version of "Magic Domain" saw a 50.4% increase in monthly active users, contributing to 36.2% of PC game active users[22]. - The "Honor of Kings" IP experienced a revenue growth of 5.8% in 2023, supported by a strong player base of over 300 million[22]. - The company plans to launch a new game, "Code-Alpha," in 2024, leveraging the success of the "Conquest" game[22]. Education Business Developments - The company successfully completed the spin-off of its overseas education business, Mynd.ai, which is now listed in the United States, enhancing its competitiveness in the hardware sector[5]. - The company aims to redefine the education industry landscape through its leadership position in the classroom hardware and software market[6]. - NetDragon's education business hardware sales have returned to pre-pandemic levels, indicating recovery in the sector[5]. - Mynd.ai's revenue for 2023 was RMB 2.9 billion, down from RMB 3.9 billion in 2022, reflecting a return to normalcy post-COVID-19[24]. - The gross margin for Mynd.ai increased to 25%, up 1.3 percentage points from 2022, due to lower raw material and shipping costs[24]. Strategic Initiatives and Future Plans - The company plans to continue creating long-term value for shareholders in 2024, building on its growth strategies[7]. - The company aims to expand its market presence in Japan, the Middle East, and Indonesia in 2024, focusing on new game development projects[23]. - Mynd.ai plans to enhance its software business and develop subscription-based SaaS revenue opportunities in 2024[25]. - The company is committed to enhancing its software quality management system, led by its senior vice president, Mr. Lin, who has a strong background in software quality assurance[50]. Corporate Governance and Management - The company has a strong management team with over 30 years of experience in the IT and telecommunications industry, led by Vice Chairman Dr. Liang Nianjian[43]. - The company has received multiple awards for its contributions to the economy and youth development in Fujian Province[44]. - The board of directors includes four executive directors and four non-executive directors, with a focus on strategic oversight and performance monitoring[119]. - The company has adopted corporate governance practices in line with the listing rules, ensuring effective risk management[118]. - The company has implemented a board diversity policy since 2013 and continues to monitor and maintain it[151]. Employee and Workplace Culture - The company emphasizes a learning culture, encouraging lifelong learning and conducting comprehensive training for employees[40]. - The company provides a friendly and enjoyable work environment with comprehensive facilities, including sports courts and a swimming pool[41]. - The company has established employee inclusion groups to enhance communication and cooperation among diverse groups, focusing on gender, race, LGBTQ+, and disability[193]. - The company conducts annual health check-ups for employees and provides comfortable spaces for pregnant and breastfeeding employees[193]. Sustainability and ESG Commitment - In December 2023, NetDragon received an upgrade in its ESG rating to BBB from MSCI, reflecting its commitment to sustainable development[7]. - The company is committed to balancing economic growth, social progress, and environmental protection as part of its sustainable development governance[148]. - The company has established a comprehensive cybersecurity management framework, ensuring strict compliance with local laws and regulations related to information security[165]. - The company has implemented advanced monitoring systems to detect and respond to suspicious network activities promptly[178]. Risk Management and Compliance - The company is committed to complying with various legal and regulatory requirements to protect employee rights and ensure data security[54]. - The company acknowledges the risks associated with new technologies and games that could render current offerings less appealing, impacting profitability and growth prospects[52]. - The group may face significant adverse tax consequences if the Chinese tax authorities determine that the contractual arrangements are not established on an arm's length basis[93]. - The company has established a dedicated internal audit department to oversee employee feedback and suggestions, ensuring a transparent communication environment[198].