7ROAD(HK:00797)2020-06-30 10:54Financial Performance - 7Road Holdings Limited reported an increase in average monthly paying users to 150,000, representing a 20% growth year-over-year[9]. - The company achieved a revenue of $50 million for the fiscal year ending December 31, 2019, marking a 15% increase compared to the previous year[12]. - The average revenue per paying user was reported at $33.33, which is a 10% increase from the prior year[10]. - For the year ended December 31, 2019, total revenue was approximately RMB 333.4 million, an increase of about 0.3% compared to the previous year[20]. - The company recorded a profit attributable to owners of approximately RMB 10.8 million for the year ended December 31, 2019[20]. - Adjusted net profit attributable to owners was approximately RMB 21.4 million for the year ended December 31, 2019[20]. - The company reported a net profit margin of 20% for the fiscal year, consistent with industry standards[11]. - The company reported a significant decrease in operating profit, which fell by 61.5% to RMB 8,200,000 in 2019 from RMB 21,282,000 in 2018[49]. - The company reported a basic and diluted earnings per share of RMB 0.0044, recovering from a loss per share of RMB 0.0461 in the previous year[158]. - The company reported a net profit for the year of RMB 13,905,000, a significant recovery from a loss of RMB 98,031,000 in 2018[158]. Market Expansion and Strategy - 7Road Holdings Limited plans to expand its market presence by launching two new mobile games in Q3 2020[11]. - The company aims to increase its user base by 25% through targeted marketing strategies in the upcoming year[10]. - The company is exploring potential mergers and acquisitions to enhance its portfolio and market share in the gaming industry[10]. - The company plans to launch a major 3D mobile game titled "Shenqu" in 2020 and is preparing to develop a new core IP game "Dandan Hall H5"[25]. - The company aims to explore niche markets, including casual competitive and female-oriented products, to capture more market opportunities[25]. - The company will continue to invest in mergers and acquisitions of quality companies within the industry to strengthen strategic synergies[25]. - The company is actively seeking to expand into promising business areas such as gaming cloud, cloud gaming, and big data to enhance long-term sustainability and profitability[25]. Financial Guidance and Projections - The board has set a performance guidance of $60 million in revenue for the next fiscal year, reflecting a 20% growth target[12]. - The global gaming market revenue exceeded USD 152.1 billion in 2019, with an expected growth to USD 196 billion by 2022, reflecting a compound annual growth rate of 10.4%[23]. - The global gaming market revenue is projected to exceed $160 billion in 2020, with a year-on-year growth of 7.3%[24]. - Mobile gaming is expected to be the fastest-growing segment in 2020, with a year-on-year growth rate of 11.6%[24]. Corporate Governance and Management - The company has a strong management team with extensive experience in finance, product development, and business management[33][34]. - The company emphasizes the importance of data analysis in its business management strategies[34]. - The company has been actively involved in the gaming industry for over a decade, with key personnel having extensive backgrounds in game production and management[33][34]. - The company is committed to leveraging its experienced board and management team to drive future growth and market expansion[32][33]. - The company has implemented a series of corporate governance policies and measures, ensuring compliance with applicable codes and regulations[69]. - The company has been focusing on maintaining high levels of corporate governance, with a review of internal policies and procedures[69]. Acquisitions and Investments - The company has completed the acquisition of Osmanthus Vale Holdings Limited's gaming business, which is expected to contribute an additional $10 million in revenue[9]. - The company completed the acquisition of a business on October 22, 2019, and will integrate resources to enhance its competitive position in the gaming industry[41]. - The company plans to invest RMB 230.7 million in self-developed online games and other intellectual properties[103]. - The company has allocated RMB 153.9 million for investments in game developers and publishers[103]. Employee and Operational Insights - As of December 31, 2019, the company had 555 full-time employees, with 471 (84.86%) in R&D and 393 (70.81%) specifically in game development[138]. - The company has established employment contracts detailing positions, employment terms, salaries, employee benefits, and termination reasons[138]. - The company provides targeted training to employees to enhance their technical and product knowledge[138]. Financial Position and Assets - Total assets as of December 31, 2019, were RMB 1,941.96 million, an increase from RMB 1,335.59 million in 2018[21]. - Total equity was RMB 1,114.83 million as of December 31, 2019, compared to RMB 1,177.13 million in 2018[21]. - Non-current liabilities increased to RMB 365.56 million in 2019 from RMB 56.25 million in 2018[21]. - The company reported a total available reserve of RMB 3,845.6 million as of December 31, 2019[100]. - The total liabilities increased significantly, with a total of RMB 365,555 in non-current liabilities compared to RMB 56,247 in the previous year, indicating a substantial rise in financial obligations[165]. Compliance and Legal Matters - The company has complied with relevant laws and regulations that have a significant impact on its operations as of December 31, 2019[95]. - The company did not experience any significant adverse impact on its financial statements due to the COVID-19 outbreak as of the date of the financial report's authorization for publication[66]. - The company believes that the ongoing litigation with Youlai Interactive Group will not have a significant adverse impact on its financial statements[67]. Shareholder Information - The company has adopted a dividend policy to share profits while retaining sufficient reserves for future growth[135]. - The company decided not to declare any final dividend for the year ended December 31, 2019[96]. - The largest customer accounts for 12.64% of total revenue, while the top five customers account for 46.78%[134]. - The largest supplier accounts for 7.55% of total procurement, with the top five suppliers accounting for 24.75%[134].