Financial Performance - The company's after-tax loss significantly decreased by 61.8% to approximately HKD 164 million, attributed to increased revenue from its core sports business and cost-cutting measures [19]. - Total revenue was approximately HKD 1,066.5 million, with a gross profit of HKD 54.1 million; sports and lottery-related business revenue grew by 53.0% to about HKD 144.9 million, while telecommunications media and e-commerce revenue declined by 10.8% to approximately HKD 921.6 million [21]. - Total revenue for the six months ended June 30, 2020, was HKD 1,066.5 million, a decrease of 5.5% compared to HKD 1,127.994 million in the same period of 2019 [99]. - The revenue from sports and lottery-related business was HKD 144.9 million, accounting for 13.6% of total revenue, compared to HKD 94.7 million (8.4%) in 2019 [100]. - Revenue from telecommunications media and e-commerce business was HKD 921.6 million, representing 86.4% of total revenue, down from HKD 1,033.261 million (91.6%) in 2019 [100]. - Gross profit for the six months ended June 30, 2020, was HKD 54.1 million, down from HKD 74.2 million in the same period of 2019 [95]. - The company reported a loss before tax of HKD 22.1 million, an improvement from a loss of HKD 43.8 million in the same period of 2019 [95]. - The company’s net loss for the period was HKD 16.4 million, compared to a net loss of HKD 42.8 million in 2019 [95]. - The group recorded a loss of approximately HKD 16.4 million, a 61.8% reduction compared to a loss of approximately HKD 42.8 million in the same period of 2019 [126]. - The adjusted EBITDA for the period was HKD 1,942,000, down from HKD 2,547,000 in the previous year, reflecting a decrease of about 24% [136]. User Growth and Engagement - The number of registered users for the Crazy Sports APP increased by 15% to 23.78 million by the end of June 2020 [26]. - As of June 30, 2020, the registered users of Crazy Sports and Crazy Red Card platforms reached approximately 23.78 million, representing a 15% increase from December 2019 [53]. - The user base for the sports competitive card games has been stable, contributing significantly to the revenue, with popular titles including "Hot Pot Mahjong" and "Super League Poker" [61]. - The official Chinese version of "Soccer Manager 2020" has surpassed 1.5 million registered users in China [64]. Business Strategy and Expansion - The company is actively expanding its market coverage for Crazy Sports, collaborating with 17 major platforms and several convenience store chains for lottery sales [26]. - The company aims to leverage the policy advantages of the Hainan Free Trade Port to boost its internet sports business [28]. - The company is focused on establishing two-way communication channels with investors to enhance understanding of its strategies and financial performance [29]. - The company is committed to strengthening its core internet sports ecosystem despite challenges posed by the pandemic [23]. - Crazy Sports plans to install sports lottery terminals in no less than 15,000 retail outlets across various provinces in China, in collaboration with major chains like Guangdong CR Vanguard and JD Convenience [55]. - Crazy Sports aims to leverage the new retail strategy to enhance user acquisition and expand its online lottery services through offline retail channels [59]. - The company is expanding its core business by leveraging the synergy between online and offline operations to boost sales of online sports lottery products [35]. - The company aims to activate its 200 million user resources through refined operations and promotional strategies, directing online users to offline lottery sales points [34]. Product Development and Innovation - The company launched a new upgraded mobile game related to the Chinese Super League, marking its entry into football e-sports [27]. - The company is focusing on developing and launching sports leisure games, utilizing resources from 16 clubs and over 500 players in the Chinese Super League [36]. - The company has launched new paid products, such as "Premium Courses" and "Plan Lists," to enhance its knowledge payment system and user engagement [48]. - Crazy Sports has initiated a cloud gaming strategy in collaboration with China Mobile, with the native cloud game "Dream Football" expected to launch by the end of November 2020 [66]. - The company has introduced over 100 domestic sports games and plans to launch the WALAGame sports gaming platform in the second half of 2020 [65]. - Crazy Sports officially entered the esports market with the launch of the upgraded official mobile game "Live Super League," featuring 16 clubs and over 500 licensed players from the Chinese Super League [70]. Community and Cultural Engagement - The company launched various collaborative programs and original productions to enhance cultural exchange between China and Arab countries during the reporting period [86]. - The company plans to continue promoting cultural exchanges and trade cooperation between China and Arab countries in the second half of 2020 [91]. - The company’s platform generated over 10 million views and 1.2 million user interactions during its COVID-19 reporting efforts [91]. Financial Position and Assets - The total assets of the company as of June 30, 2020, were approximately HKD 1,355,200,000, up from HKD 1,272,300,000 as of December 31, 2019, indicating a growth of about 6.5% [145]. - The company had cash and cash equivalents of approximately HKD 68,413,000 at the end of the period, compared to HKD 83,544,000 at the end of 2019 [138]. - The financing activities generated a net cash inflow of approximately HKD 12,663,000, mainly due to a new share placement that raised approximately HKD 14,800,000 [143]. - The capital debt ratio as of June 30, 2020, was approximately 1.1%, calculated based on total borrowings divided by equity attributable to the owners of the company [146]. - The company’s investment portfolio recorded a fair value increase of approximately HKD 99,300,000 during the period, primarily from a mobile internet fund invested in 2016 [136]. Shareholder and Equity Information - The company has issued a total of 1,032,563,113 shares, representing approximately 24.08% of the total issued share capital [164]. - The shareholding structure includes significant interests held by Zhang Lijun and Wang Chun, each owning 1,032,563,113 shares, equating to 24.08% [167]. - The company granted 23,000,000 stock options during the reporting period under the stock option plan [185]. - The stock options granted are subject to the terms of the First Video Plan, which was approved by shareholders on April 27, 2012 [184]. - The total number of share options granted during the period was 23,000,000, with an exercise price of HKD 0.385 [190]. - The company has adopted a share incentive plan to reward key management and employees, effective for a period of 10 years [200]. - The total number of share options granted to other participants was 20,000,000, with 6,000,000 options exercised during the period [194]. - The exercise period for the options ranges from 2019 to 2023, indicating a long-term incentive strategy [194]. - The company aims to enhance employee retention and motivation through the share incentive and option plans [200].
疯狂体育(00082) - 2020 - 中期财报