青瓷游戏(06633) - 2024 - 中期财报

Company Information Company Profile This section outlines Qincai Games Co., Ltd.'s fundamental information, including its board, committees, key personnel, and auditor, PricewaterhouseCoopers - Executive Directors include Mr. Yang Xu (Chairman), Mr. Huang Zhiqiang, Mr. Liu Siming, and Mr. Zeng Xiangshuo[3] - The company's auditor is PricewaterhouseCoopers[6] Financial and Operational Highlights Key Financial and Operational Data In H1 2024, revenue grew 3% to RMB 343 million, while gross profit and net profit declined, and MAU increased 21% despite a 7% drop in ARPPU H1 2024 Financial Summary | Indicator | For the Six Months Ended June 30, 2024 (RMB Thousand) | For the Six Months Ended June 30, 2023 (RMB Thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 342,622 | 333,937 | 3% | | Gross Profit | 211,787 | 225,413 | (6%) | | Net Profit | 38,203 | 41,717 | (8%) | | Profit Attributable to Equity Holders of the Company | 45,059 | 41,482 | 9% | H1 2024 Key Operational Data | Indicator | For the Six Months Ended June 30, 2024 | For the Six Months Ended June 30, 2023 | Change (%) | | :--- | :--- | :--- | :--- | | Average MAU (Thousand People) | 2,179 | 1,798 | 21% | | Average MPU (Thousand People) | 253 | 258 | (2%) | | ARPPU (RMB) | 275 | 296 | (7%) | | Cumulative Registered Players (Thousand People) | 93,389 | 82,365 | 13% | Management Discussion and Analysis Business Overview The Group strengthened its integrated R&D and operations, achieving stable business growth driven by significant overseas expansion, robust performance of core games, and a continuously enriched product pipeline - Overseas game business achieved significant growth, with H1 2024 overseas revenue reaching RMB 143 million, a year-on-year increase of approximately 120%, and its revenue contribution rising from 19.4% to 41.7%[14] - The flagship self-developed game 'The Strongest Snail' performed steadily, with its cumulative gross billings both domestically and internationally reaching approximately RMB 3.46 billion as of June 30, 2024[14] - The Group continues to enrich its game pipeline, including refining the self-developed SLG game 'Project E' and introducing quality games like 'Project W' and 'Project HA'[14] Our Games As of June 30, 2024, the Group's portfolio includes 13 mobile and several mini-program games, with 'The Strongest Snail' and 'Sword and Fairy' being top revenue contributors H1 2024 Revenue Contribution by Major Games | Game Title | Revenue for the Period (Approx. RMB Million) | | :--- | :--- | | 'The Strongest Snail' | 189 | | 'Sword and Fairy: Together Forever' | 66.7 | | 'Fat Goose Fitness' | 27.1 | | 'Cardcaptor Sakura: Memory Key' | 17.4 | | 'Lantern and Dungeon' | 11.7 | | 'Light of the Lost' | 3.2 | | Mini-Program Games | 3.4 | - 'The Strongest Snail' maintains vitality through collaborations with renowned IPs like 'Kairosoft Games,' 'Calabash Brothers,' and 'Sanrio,' alongside expansion into Vietnamese and multi-language European markets[16] - The new game 'Fat Goose Fitness' launched in Japan in February 2024, immediately topping both iOS and Google Play free game charts, demonstrating strong publishing capabilities[18] Player Community The 'Qingci Iron Fan Community' actively engages players via social media, growing its fan base by 25.24% to 14.97 million by June 30, 2024, enhancing game development and player acquisition - As of June 30, 2024, the 'Qingci Iron Fan' community has accumulated 14.9728 million followers, representing a 25.24% year-on-year increase[20] Future Outlook The Group plans to expand its product portfolio and accelerate domestic and international launches of diverse reserved games, with 'Project E' and 'Project W' as key focuses, alongside continued overseas market expansion Mobile Game Pipeline | Name | Game Type | Source | Expected Launch Time | | :--- | :--- | :--- | :--- | | Project: Totem | Tower Defense | Licensed | 2024 | | Project V | Idle Game | Licensed | 2025 | | Project W | Card RPG | Licensed | 2025 | | Project HA | Card RPG | Licensed | 2025 | | Project E | SLG | Self-developed | 2025 | | Project 36Z | Idle Game | Licensed | 2025 | | Project T | SLG | Licensed | 2026 | | Project F | Survival Social | Licensed | 2026 | - The newly introduced 'Project W' is a 2D semi-turn-based card game adapted from the renowned novel 'The Great Ruler,' highly anticipated by the market[22] - Overseas market expansion continues, with the idle RPG card game 'BloodAge' launched in South Korea in September 2024, topping both app store charts[22] Financial Review H1 2024 total revenue grew 2.6% to RMB 343 million, driven by licensed games, but increased commission costs reduced gross margin from 68% to 62%, resulting in an 8.4% profit decline to RMB 38.2 million Revenue Analysis Total revenue increased 2.6% to RMB 343 million, primarily driven by a 1.5% rise in game operation revenue and a 57.2% surge in licensed game revenue, offsetting a decline in self-developed game revenue Revenue Composition (For the Six Months Ended June 30) | Business Category | 2024 (RMB Thousand) | 2023 (RMB Thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Game Operation Revenue | | | | | - Self-developed | 196,738 | 237,930 | (17.3) | | - Licensed | 126,434 | 80,433 | 57.2 | | Subtotal | 323,172 | 318,363 | 1.5 | | Game Licensing Revenue | 6,323 | 11,317 | (44.1) | | Information Service Revenue | 9,290 | 2,528 | 267.5 | | Other Services and Sales | 3,837 | 1,729 | 121.9 | | Total Revenue | 342,622 | 333,937 | 2.6 | - The growth in licensed game revenue was primarily driven by the launch of new games like 'Fat Goose Fitness' and 'Light of the Lost,' as well as the continued contribution from 'Cardcaptor Sakura: Memory Key'[25] Cost of Revenue Analysis Cost of revenue rose 20.6% to RMB 131 million, primarily due to a 221.0% increase in commissions paid to third-party developers and IP holders, driven by higher licensed game revenue Cost of Revenue Composition (For the Six Months Ended June 30) | Cost Nature | 2024 (RMB Thousand) | 2023 (RMB Thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Distribution and Payment Channel Commissions | 69,168 | 70,589 | (2.0) | | Third-Party Game Developer and IP Holder Commissions | 38,173 | 11,892 | 221.0 | | Bandwidth and Server Hosting Fees | 8,953 | 10,287 | (13.0) | | Employee Benefit Expenses | 6,051 | 6,595 | (8.2) | | Others | 8,490 | 9,161 | (7.3) | | Total | 130,835 | 108,524 | 20.6 | Gross Profit and Margin Analysis Gross profit decreased 6.0% to RMB 212 million, with gross margin falling from 68% to 62%, primarily due to the increased proportion of lower-margin licensed game revenue - Gross profit decreased from RMB 225 million to RMB 212 million, and gross margin declined from 68% to 62%[33] - The decline in gross margin is attributed to the increased proportion of licensed game revenue, which incurs higher commissions to third-party developers and IP holders, thereby lowering the overall gross margin[33] Operating Expenses Analysis Operating expenses increased across the board, with sales and marketing up 7.2% to RMB 132 million, R&D up 5.4% to RMB 47.1 million, and G&A up 29.4% to RMB 27.4 million Operating Expenses Overview (For the Six Months Ended June 30) | Expense Item | 2024 (RMB Million) | 2023 (RMB Million) | Change (%) | | :--- | :--- | :--- | :--- | | Sales and Marketing Expenses | 131.9 | 123.1 | 7.2% | | Research and Development Expenses | 47.1 | 44.7 | 5.4% | | General and Administrative Expenses | 27.4 | 21.2 | 29.4% | Other Financial Items Analysis Fair value gains on investments surged 536.8% to RMB 42.1 million, while other income plummeted 91.8% due to reduced subsidies, and net other losses expanded to RMB 11.6 million from adverse currency movements - Investment gains measured at fair value increased from RMB 6.6 million to RMB 42.1 million, primarily due to higher returns from wealth management products[37] - Net other losses expanded from RMB 0.1 million to RMB 11.6 million, mainly due to exchange losses incurred by JPY-denominated subsidiaries as the USD appreciated against the JPY[39] Income Tax Expense and Profit for the Period Profit for the period decreased 8.4% to RMB 38.2 million due to lower gross profit and higher expenses, while income tax expense significantly dropped 95.5% to RMB 0.8 million - Net profit for the period was RMB 38.2 million, an 8.4% decrease from RMB 41.7 million in the prior year[41][42] - Income tax expense significantly decreased by 95.5% from RMB 16.7 million to RMB 0.8 million, primarily due to changes in profit structure and recognition of deferred tax assets[40] Liquidity, Capital Resources, and Capital Structure As of June 30, 2024, the Group maintained a robust financial position with RMB 422 million in cash, a 1013.9% current ratio, and a healthy 9.8% gearing ratio Key Capital Structure Indicators (As of June 30, 2024) | Indicator | Amount (RMB Million) | | :--- | :--- | | Cash and Cash Equivalents | 421.8 | | Borrowings | 20.0 | | Current Assets | 1,638.5 | | Current Liabilities | 161.6 | | Current Ratio | 1,013.9% | | Gearing Ratio | 9.8% | Other Financial Information The Group increased short-term investments to RMB 1.096 billion for capital efficiency, maintained low capital expenditure, managed foreign exchange risks, and employed 600 full-time staff - To enhance the efficiency of its own funds, the Group's short-term investments (measured at fair value) increased from RMB 989 million to RMB 1.096 billion[44] - The Group faces foreign exchange risks, including USD and JPY, which are managed through foreign currency forward contracts[47] - As of June 30, 2024, the Group had 600 full-time employees, with 17 located overseas[48] Other Information Interim Dividend The Board resolved not to recommend an interim dividend for the six months ended June 30, 2024, consistent with the previous year - The Board does not recommend the payment of an interim dividend for 2024[49] Directors' and Major Shareholders' Interests This section details the shareholding interests of directors and major shareholders as of June 30, 2024, including holdings by executive directors via trusts and key corporate shareholders like Keiskei Holding and Hong Kong Kunpan Major Shareholders' Interests Overview (As of June 30, 2024) | Shareholder Name | Approximate Percentage of Shareholding (%) | | :--- | :--- | | Keiskei Holding Ltd. (Mr. Yang Xu) | 29.81% | | Hong Kong Kunpan (G-bits) | 18.55% | | Rapid Yacht Limited (Mr. Ye Jiting) | 7.26% | | Intelligence QC Ltd. (Mr. Huang Zhiqiang) | 5.40% | | Alibaba Kukar (Alibaba) | 5.34% | Use of Net Proceeds from Listing The company utilized HKD 865 million of its HKD 926 million listing proceeds by June 30, 2024, with the remaining HKD 61.3 million allocated for product expansion and China market distribution, expected to be fully used by June 2025 Use of Listing Proceeds and Utilization (As of June 30, 2024) | Use of Proceeds | Allocated Amount (HKD Million) | Cumulative Utilized (HKD Million) | Unutilized Amount (HKD Million) | Expected Full Utilization Time | | :--- | :--- | :--- | :--- | :--- | | Expand Game Portfolio and R&D | 324.0 | 296.7 | 27.3 | Before June 2025 | | Expand Overseas Markets | 231.4 | 231.4 | 0 | N/A | | Strengthen China Market Distribution and Operations | 138.9 | 111.9 | 27.0 | Before June 2025 | | Strategic Investments and Acquisitions | 138.9 | 131.9 | 7.0 | Before December 2024 | | Working Capital and General Corporate Purposes | 92.6 | 92.6 | 0 | N/A | | Total | 925.8 | 864.5 | 61.3 | | Corporate Governance and Compliance The company complied with all Corporate Governance Code provisions, directors adhered to securities trading standards, and the Audit Committee reviewed interim financial information with management and the auditor - The Board believes the company complied with all code provisions of the Corporate Governance Code during the reporting period[65] - The Audit Committee, chaired by Mr. Yuan Yuan, comprises three independent non-executive directors and has reviewed the interim financial information[67] Interim Financial Statements Review Report on Interim Financial Information PricewaterhouseCoopers reviewed the interim financial information under ISRE 2410, concluding no material issues regarding its preparation in accordance with IAS 34 - Auditor PricewaterhouseCoopers issued a review conclusion, finding no material issues in the interim financial information[72] Condensed Consolidated Statement of Comprehensive Income This statement details revenue, costs, expenses, profit, and other comprehensive income for H1 2024, reporting RMB 343 million revenue, RMB 212 million gross profit, and RMB 38.2 million profit Condensed Consolidated Statement of Financial Position This statement outlines the financial position as of June 30, 2024, with total assets at RMB 1.986 billion, total liabilities at RMB 194 million, and total equity at RMB 1.792 billion Condensed Consolidated Statement of Changes in Equity This statement illustrates changes in equity components, including share capital, share premium, and reserves, reflecting the impact of period profit and currency translation differences on shareholders' equity Condensed Consolidated Statement of Cash Flows This statement summarizes cash flows, showing net outflows of RMB 23.9 million from operations, RMB 84.1 million from investing, and RMB 5.2 million from financing, leading to a net decrease of RMB 113 million in cash and equivalents Notes to the Interim Financial Information Note 6: Segment Information and Revenue The Group operates as a single mobile game segment; Mainland China remains the main revenue source at RMB 199.9 million, while overseas revenue significantly grew to RMB 142.7 million, increasing its proportion of total revenue Revenue Breakdown by Geographical Region (For the Six Months Ended June 30) | Region | 2024 (RMB Thousand) | 2023 (RMB Thousand) | | :--- | :--- | :--- | | Mainland China | 199,907 | 269,043 | | Other Regions | 142,715 | 64,894 | | Total | 342,622 | 333,937 | Note 12: Income Tax Total income tax expense was RMB 0.754 million, significantly lower than prior year, influenced by varied jurisdictional tax rates, preferential rates, non-deductible expenses, and R&D super deductions - Some subsidiaries are recognized as 'software enterprises,' enjoying a 'two-year exemption and three-year half-rate' corporate income tax preferential policy[122] - The Group is entitled to claim a 200% super deduction for R&D expenses, which positively impacts the effective tax rate[122] Note 31: Related Party Transactions The Group transacts with related parties, including G-bits Group, paying RMB 1.495 million in marketing fees and receiving RMB 6.206 million in licensing revenue, while paying RMB 24.565 million in developer commissions to associated companies Major Related Party Transactions (For the Six Months Ended June 30, 2024) | Transaction Type | Related Party | Amount (RMB Thousand) | | :--- | :--- | :--- | | Game Licensing Revenue | G-bits Group | 6,206 | | Game Developer Commissions | Chengdu Xingqiwan Technology | 21,100 | | | Shenzhen Jishiwu Technology | 2,551 | | | Shenzhen Requ Network Technology | 914 | | Marketing and Promotion Expenses | Guangzhou Zhuodong Information Technology | 2,980 | | | G-bits Group | 1,495 | Period-End Balances with Related Parties (As of June 30, 2024) | Balance Type | Amount (RMB Thousand) | | :--- | :--- | | Trade Receivables from Related Parties | 7,489 | | Trade Payables to Related Parties | 36,392 | | Prepayments to Related Parties | 35,662 |