CMGE(HK:00302)2025-03-27 14:54Financial Performance - The total revenue for the year ended December 31, 2024, was RMB 1,930.1 million, a decrease of 26% compared to RMB 2,605.9 million in 2023[5]. - The gross profit for 2024 was RMB 603.1 million, down from RMB 943.1 million in 2023, reflecting a significant decline in profitability[5]. - The net loss for the year was RMB 2,110.8 million, compared to a loss of RMB 38.0 million in the previous year, indicating a substantial deterioration in financial performance[5]. - Adjusted net loss for 2024 was RMB 2,077.7 million, contrasting with an adjusted profit of RMB 5.4 million in 2023[5]. - The company's revenue decreased by approximately 25.9% from RMB 2,605.9 million in 2023 to RMB 1,930.1 million in 2024[57]. - Game publishing revenue fell by 22.0% from RMB 2,133.8 million in 2023 to RMB 1,664.5 million in 2024, attributed to delays in the launch of several planned games[60]. - Game development revenue decreased by 30.7% from RMB 215.1 million in 2023 to RMB 149.1 million in 2024, missing revenue opportunities due to delayed game releases[60]. - The company's gross profit declined by 36.1% from RMB 943.1 million in 2023 to RMB 603.1 million in 2024, with a gross margin drop from 36.2% to 31.2%[62]. - The adjusted net loss for the year attributable to the parent company was RMB 2,105.0 million in 2024, compared to a profit of RMB 20.1 million in 2023[56]. Game Development and Launches - The company faced challenges with the delayed launch of its self-developed core game "Xianjian World," which did not meet performance expectations post-launch[7]. - The company plans to launch several new IP games between 2025 and 2026, including titles based on popular franchises, aiming to leverage its strong competitive position in the IP game market[8]. - The company successfully launched three new IP premium games and two innovative mini-games during the reporting period, contributing to a total revenue of RMB 1,664.5 million for the publishing business by December 31, 2024[15]. - The mobile game "Douluo Dalu: Shrek Academy," based on the popular novel and anime, achieved over RMB 100 million in revenue within the first month of its launch, with over 6 million pre-registrations[16]. - The company is set to launch a new pixelated mini-game titled "Three Thousand Fantasy Worlds" in April 2025, which is based on a licensed adaptation from Tencent Animation[10]. - The company has optimized its self-developed team, focusing on legendary genre games and innovative mini-game development, with a new game titled "Code: Dark Night Legend" expected to launch in the first half of 2025[10]. - The mobile game "Doupo Cangqiong: Peak Showdown," based on another popular novel, achieved over 6 million pre-registrations before its launch but faced revenue declines due to gameplay design issues[17]. - The newly launched mobile game "Douluo Dalu: Reversal of Time and Space" achieved the top position on Apple's free game chart but did not meet initial revenue expectations due to increased user acquisition costs and market competition[18]. - The company aims to enter a comprehensive profit recovery phase in 2025 as multiple optimized IP premium games and innovative mini-games are launched globally[14]. Market Expansion and Strategy - Overseas revenue reached RMB 272.1 million, accounting for 14.1% of total revenue, highlighting the company's efforts to expand its international market presence[7]. - The company aims to deepen its presence in the Hong Kong, Macau, and Taiwan markets while expanding into Japan, Korea, and Southeast Asia by 2025[9]. - The overall strategy emphasizes "business focus + cost control" to navigate the competitive gaming industry landscape and improve financial performance[8]. - The group plans to launch several new games in 2025, including "Chat Group Daily Life" and "New Three Kingdoms: Cao Cao Biography," focusing on product quality and user experience[19]. - The group plans to release several successful games in overseas markets in 2025, including "斗破蒼穹：巔峰對決" and "真 · 三國無雙霸" to increase international revenue[40]. Research and Development - The company reported a 34.0% year-on-year decrease in R&D expenses in 2024 due to effective cost control measures and the application of generative AI technology[13]. - The company is exploring the potential of AI in gaming, aiming to integrate AI into mini-game development for innovative gameplay experiences[11]. - The company is committed to enhancing its R&D capabilities and exploring AIGC technology to ensure robust growth in 2025 and beyond[50]. - Research and development costs decreased from RMB 370.3 million in 2023 to RMB 244.3 million in 2024, reflecting a strategic shift in resource allocation[61]. Financial Management and Cost Control - The overall strategy emphasizes "business focus + cost control" to navigate the competitive gaming industry landscape and improve financial performance[8]. - The group has maintained a continuous focus on cost control and resource optimization, aiming to enhance efficiency through AIGC applications and improve management processes[31]. - The company has a strict control over overdue receivables, with overdue balances reviewed regularly by senior management[149]. - The company continues to maintain a focus on cash flow management and risk assessment related to trade receivables[149]. Community Engagement and IP Management - The group organized a 29th anniversary celebration for "Xianjian Qixia Chuan," featuring various offline activities across multiple cities, enhancing community engagement[26]. - The group successfully launched several derivative products based on the "Xianjian" IP, including blind box series and classic weapon models, achieving crowdfunding exceeding RMB 10 million[26]. - The company plans to launch more collectible statues in 2025, collaborating with various professional model studios to enhance the value of its IP derivatives[46]. - The company aims to enhance the operation of the "Xianjian Qixia Chuan" IP, with multiple anime projects and new game adaptations expected to drive fan engagement and revenue growth[12]. Awards and Recognition - The company received multiple awards in 2024, including the "Top 10 Game Enterprises" and "Most Responsible Listed Company" accolades[54]. - The group has been recognized as an "ESG Comprehensive Governance Benchmark Enterprise" for its commitment to environmental sustainability and social responsibility[28]. Shareholder and Financial Structure - The company did not recommend a final dividend for the year ended December 31, 2024, consistent with the previous year[104]. - The company has no significant external financing plans as of December 31, 2024[78]. - The company has not proposed a final dividend for the year ended December 31, 2024, consistent with the previous year[141]. - The company recorded a significant impairment loss of RMB 16,844,000 for the cash-generating unit related to Shanghai Zhoujing's game development business in 2024, which was not present in 2023[146].