Revenue Performance - In the first half of 2021, the Group's revenue from conditional access modules (CAMs) was approximately US$10.4 million, a decrease of 4.6% compared to US$10.9 million in the same period of 2020, accounting for 67.1% of the Group's total revenue[9]. - Total revenue for the six months ended June 30, 2021, was US$15.5 million, a decrease of 14.8% compared to US$18.2 million in the same period in 2020[16]. - Cloud services revenue reached approximately US$2.0 million, a 122.2% increase compared to US$0.9 million in the first half of 2020, representing 12.9% of total revenue[13]. - Revenue from integrated circuit solutions was approximately US$3.1 million, accounting for 20.0% of total revenue[13]. - The overall market sales of CAMs slightly declined in the first half of 2021, impacting the Group's sales performance[9]. - The domestic market sales increased by 54.3% year-on-year to US$0.7 million, driven by growth in domestic Pro-CAM sales[11]. - Sales to customers located in Russia accounted for 12.6% of total revenue for the period ended June 30, 2021, while sales to customers in the Balkans and Ukraine accounted for 8.8%[76]. Expenses and Financial Performance - Research and development expenses increased by 239.5% to US$20.4 million compared to the same period last year, primarily due to the full commencement of all government research projects undertaken by the Group[23]. - Selling and distribution expenses amounted to US$0.9 million, representing an increase of 14.3% compared to the same period last year, mainly due to increased promotion expenses for CAM products[23]. - General and administrative expenses rose by 17.7% to US$5.0 million compared to the same period last year, mainly due to increased headcount and staff costs associated with business expansion[23]. - The loss for the period amounted to US$1.8 million, representing a decrease of 71.2% compared to the same period in 2020, mainly due to higher gross profit margin and other income from government grants[25]. - Operating loss for the period was $4,589,094, worsening from a loss of $2,654,160 in the previous year[98]. - The company reported finance costs of $684,221, significantly higher than $53,387 in the previous year, reflecting increased borrowing costs[98]. Cash Flow and Financial Position - As of June 30, 2021, total cash and cash equivalents amounted to US$44.3 million, down from US$46.5 million as of December 31, 2020[25]. - The company experienced a net decrease in cash and cash equivalents of $(2,544,332), with cash and cash equivalents at June 30, 2021, amounting to $44,270,207[138]. - The company’s cash flows from financing activities resulted in a net cash used of $(9,034,607), contrasting with a net cash generated of $5,949,530 in the prior year[136]. - The company reported a significant increase in interest income received, totaling $159,751, compared to $297,747 in the same period last year[136]. - The Group maintained a current ratio of 131.6% as of June 30, 2021, down from 146.6% as of December 31, 2020[25]. Research and Development Initiatives - The Group has launched research and development for the electronic design automation (EDA) system, expanding into the semiconductor integrated circuit (IC) smart technology business, which includes cloud services and IC solutions[9]. - The company aims to enhance its R&D capabilities and promote the marketization of new revenue growth points in integrated circuit solutions[13]. - The Group aims to enhance its independent R&D level and ensure its technology roadmap aligns with industry innovation trends[35]. - The Group will continue to focus on IC design and accelerate the R&D innovation process to contribute to the nationalization of IC design and production[35]. Corporate Governance and Compliance - The Company has adopted the Corporate Governance Code since its listing on March 30, 2016, and complied with the code provisions except for provision A.2.1[83]. - All Directors confirmed compliance with the Model Code for Securities Transactions during the six months ended June 30, 2021[85]. - The Audit Committee reviewed the Group's unaudited interim financial information for the six months ended June 30, 2021[85]. Market Strategy and Future Outlook - The company plans to increase promotion of new platform products and invest more resources in the introduction of CI+ 2.0 products in the second half of the year[11]. - The Group plans to strengthen customer communication mechanisms and optimize product performance in its cloud services business[35]. - Future strategies may include market expansion and potential mergers or acquisitions to strengthen its position[200]. - The company expects stable sales to customers in Russia, Ukraine, and the Balkans in the second half of 2021[76]. Investments and Financial Assets - The Group had equity securities investments in six unlisted companies with an aggregate fair value of approximately US$13.2 million as of June 30, 2021, compared to US$11.7 million as of December 31, 2020[27]. - The Group's financial assets at fair value through profit or loss amounted to USD 13,170,525 as of June 30, 2021[165]. - The Group's Level 3 instruments included unlisted equity securities acquired in various years, with significant values such as USD 8,159,259 for securities acquired in November 2018[178]. Risk Management - The Group established a risk management committee to monitor exposure to sanctions risks and export controls, comprising senior management[80]. - The risk management committee conducted customer due diligence to assess sanctions risks before engaging in business opportunities in sanctioned countries[80]. - No exposure to sanctions risks was identified by the risk management committee during the period ended June 30, 2021, which required retaining an external legal adviser[80].
国微控股(02239) - 2021 - 中期财报