家乡互动(03798) - 2019 - 中期财报

Company Information Provides key corporate details including registration, stock code, board members, auditor, and headquarters Company Basic Information Homeland Interactive Technology Ltd., registered in Cayman Islands with stock code 3798, details its board, auditor, and China headquarters - Company Name: Homeland Interactive Technology Ltd - Stock Code: 3798[1][4] - Registered in: Cayman Islands[1][4] - Chairman and CEO: Mr. Wu Chengze[4] - Auditor: Deloitte Touche Tohmatsu[4] - China Headquarters: 7A, Huijin Building, No. 77 Tainan Road, Siming District, Xiamen[4] Business Overview and Outlook Reviews the company's performance as a leading mobile board game developer and outlines future growth strategies Business Review Homeland Interactive, a leading localized mobile board game developer, achieved significant revenue and profit growth in H1 2019, expanding its game portfolio and user base - The Group is a leading localized mobile board and card game developer and operator in China, specializing in localized Mahjong and poker games, developing and operating casual games, and distributing third-party mobile games[7] - As of June 30, 2019, the Group had developed and operated 482 localized Mahjong variations, 38 poker game variations, and 5 casual games, and distributed 7 third-party mobile games[7] H1 2019 Key Financial Performance | Metric | H1 2019 (RMB million) | H1 2018 (RMB million) | Y-o-Y Growth (%) | | :----------- | :-------------------- | :-------------------- | :--------------- | | Revenue | 266.5 | 212.0 | 25.7% | | Gross Profit | 205.1 | 167.5 | 22.5% | | Adjusted Net Profit | 144.6 | 110.3 | 31.1% | - As of June 30, 2019, cumulative registered players reached 123,377,190 persons, an increase of 27.1% from December 31, 2018; DAUs increased to 5,505,360 persons, up 5.8%; and paying players reached 3,951,669 persons, up 22.5% from full-year 2018[8] - The Company's shares successfully listed on the Main Board of the Hong Kong Stock Exchange on July 4, 2019, laying the foundation for the Group's development[8] Business Outlook The Group plans to expand its game portfolio, enhance R&D, strengthen marketing, and pursue M&A opportunities for future growth - Further develop and optimize the game portfolio, expanding geographical coverage nationwide (excluding Taiwan, Tibet, Qinghai, Xinjiang, Shanghai, Guangzhou, and Shenzhen), and launching more casual games[9] - Continue to strengthen R&D and technical infrastructure, particularly enhancing game features, improving player experience, and developing HTML5 versions and other potential mini-programs[9] - Strengthen marketing capabilities and enhance brand image, including investing in promotional activities, social media advertising, third-party platform advertising, and sponsoring game competitions[9] - Continue to seek potential cooperation or acquisition opportunities with small and medium-sized mobile game developers and operators to increase game-related resources and market experience[9] Management Discussion and Analysis Analyzes the Group's financial performance, liquidity, capital expenditure, and human resources for the period Financial Review H1 2019 revenue grew by 25.7% to RMB 266.5 million, but increased costs and expenses led to a slight 2.3% decrease in profit before tax - Revenue increased by 25.7% from RMB 212.0 million in H1 2018 to approximately RMB 266.5 million in H1 2019, primarily due to an expanded game portfolio and increased third-party mobile game distribution[10] Revenue Composition Change (H1 2019 vs H1 2018) | Revenue Source | H1 2019 % | H1 2018 % | | :----------------------- | :-------- | :-------- | | Virtual Tokens | 53.7% | 49.6% | | Private Game Room Cards | 36.3% | 50.4% | | Third-Party Mobile Game Distribution | 10.0% | 0% | - Cost of sales increased by 38.0% to RMB 61.4 million, mainly due to a RMB 13.4 million increase in commissions paid to third-party distribution channels and payment providers, and a RMB 5.7 million increase in employee benefit expenses[11] - Gross profit increased by 22.5% to RMB 205.1 million, but the gross profit margin decreased from 79.0% to 77.0%, primarily due to increased commissions from greater use of third-party distribution channels[12] - Other income significantly increased by approximately 10.5 times to RMB 22.9 million, mainly from RMB 9.8 million in advertising revenue and RMB 8.5 million in offline promotional marketing service income[14] - Selling and marketing expenses increased by 94.6% to RMB 46.9 million, primarily due to an RMB 11.3 million increase in advertising expenses and an RMB 10.1 million increase in in-game promotion expenses[16] - Administrative expenses increased by 264.9% to RMB 40.5 million, primarily due to RMB 26.5 million in share-based payment expenses[17] - Profit before income tax decreased by 2.3% to RMB 126.4 million, with its percentage of total revenue falling from 61.0% to 47.4%, mainly impacted by increased costs, expenses, and listing expenses[18] - Profit and total comprehensive income for the period decreased by 1.2% to RMB 104.1 million, with the profit margin decreasing from 49.7% to 39.1%[20] Non-IFRS Measures — Adjusted Net Profit Adjusted net profit, excluding listing expenses and share-based payments, increased by 31.1% in H1 2019, reflecting core business performance Adjusted Net Profit Calculation (H1 2019 vs H1 2018) | Metric | 2019 (RMB thousand) | 2018 (RMB thousand) | | :------------------- | :------------------ | :------------------ | | Profit for the period | 104,134 | 105,422 | | Add: Listing-related expenses | 14,019 | 4,905 | | Add: Share-based payment expenses | 26,457 | — | | Adjusted Net Profit | 144,610 | 110,327 | - Excluding listing-related expenses and share-based payment expenses, adjusted net profit for H1 2019 was approximately RMB 144.6 million, an increase of 31.1% compared to H1 2018[22] Liquidity and Capital Resources The Group maintains strong liquidity, primarily funded by operating cash flow, with RMB 340.5 million in cash and zero debt-to-equity ratio - The Group primarily funds its operations with cash generated from operating activities and intends to finance expansion through internal resources and sustainable growth[24] - As of June 30, 2019, cash and cash equivalents were approximately RMB 340.5 million, a significant increase from approximately RMB 218.2 million as of December 31, 2018[25] - Except for lease liabilities of RMB 11.087 million, the Group had no short-term or long-term bank borrowings, resulting in a zero debt-to-equity ratio[26][27] - The Group currently does not hedge foreign currency transactions, but the Board will monitor related risks[25] - A special interim dividend of RMB 177.0 million was paid to founders in July 2019[25] Capital Expenditure Capital expenditure significantly increased to RMB 3.2 million in H1 2019, primarily for office equipment, vehicles, renovations, and game software rights - For the six months ended June 30, 2019, capital expenditure was approximately RMB 3.2 million, a significant increase from approximately RMB 0.7 million in the same period of 2018[28](index=28&type=