FEIYU(HK:01022)2025-03-28 09:20Financial Performance - The company's revenue for the year ended December 31, 2024, was RMB 276.7 million, representing a 22.4% increase compared to RMB 226.2 million in 2023[3]. - Gross profit for the same period was RMB 237.2 million, reflecting a 22.0% growth from RMB 194.5 million in the previous year[3]. - The company reported a loss before tax of RMB 44.5 million, compared to a profit of RMB 52.6 million in 2023, indicating a significant shift in financial performance[3]. - The company's gaming operations generated approximately RMB 238.8 million in revenue for the year ended December 31, 2024, representing an increase of about 36.7% compared to RMB 174.7 million for the year ended December 31, 2023[20]. - The loss for the year ending December 31, 2024, was approximately RMB 46.1 million, compared to a profit of approximately RMB 52.2 million for the year ended December 31, 2023[42]. - Total equity decreased from approximately RMB 525.9 million as of December 31, 2023, to approximately RMB 482.6 million as of December 31, 2024, primarily due to the recorded loss[43]. - Cash and cash equivalents decreased from approximately RMB 160.7 million as of December 31, 2023, to approximately RMB 100.7 million as of December 31, 2024, mainly due to the purchase of fixed-term deposits and repayment of bank loans[44]. Revenue Growth and Market Trends - The online gaming industry in China recorded revenues of RMB 325.8 billion in 2024, with a year-on-year growth of 7.5%, highlighting a recovering market environment[4]. - The successful launch of the new HTML5 game "One Step Two Steps" contributed significantly to revenue growth, achieving a ranking of 8th in the WeChat mini-game sales chart in January 2025[5][6]. - The company plans to expand its existing game IPs, with the "Defend the Carrot" series seeing a 22.2% increase in advertising revenue compared to 2023, demonstrating sustained user engagement[7]. - The company anticipates that the promotional activities for "One Step Two Steps" will yield strong returns, supporting continued growth in the coming years[6]. - The HTML5 gaming segment is expected to show strong growth potential, driven by its ease of play compared to other game types[12]. User Engagement and Product Development - The average Monthly Active Users (MAU) for RPG mobile and online games totaled approximately 0.2 million as of December 31, 2024, with mobile games contributing about 0.1 million and online games also about 0.1 million[22]. - The average Monthly Paying Users (MPU) for network games (RPG) decreased from approximately 6,000 in 2023 to about 5,000 in 2024, a decline of 16.7%[23]. - The average MPU for mobile RPG games dropped by 47.9% from approximately 94,000 in 2023 to about 49,000 in 2024[24]. - The company launched a total of 48 licensed merchandise products, focusing on lifestyle and office supplies, which have been well-received by fans[9]. - The company has successfully introduced six new products under the "Defend the Carrot" series, expanding its merchandise offerings significantly[8]. Challenges and Risks - The company faces significant risks including strict regulations in the online gaming industry in China, which could adversely affect its operations if licenses are not maintained[10]. - The company recognizes the challenges posed by rising customer acquisition costs and declining consumer confidence in the online gaming industry[12]. - The company plans to focus on long-term operations rather than immediate monetization for certain games, impacting revenue from "保卫萝卜4"[30]. Investment and Financial Strategy - The company is investing heavily in technology infrastructure to enhance player experience and game performance[11]. - The company aims to expand its game distribution platform to penetrate existing markets and explore new markets both domestically and internationally[14]. - The company is committed to improving its existing game portfolio and attracting new talent to enhance its competitive edge[14]. - The company maintains a diversified investment portfolio, with at least 50% of total investments allocated to risk-free or capital-protected investments[49]. Corporate Governance and Compliance - The company is committed to maintaining high standards of corporate governance to protect shareholder interests and enhance corporate value[150]. - The company has adhered to all relevant laws and regulations that significantly impact its business operations[81]. - The company will continue to regularly review and monitor its corporate governance practices to ensure compliance with applicable standards[152]. Future Outlook - The company plans to launch multiple new HTML5 games in 2025, continuing to invest in its successful title "Step by Step" to maintain momentum[13]. - The company plans to enhance its product offerings and increase promotional efforts for its intellectual property products to drive sales growth and improve brand recognition[19]. - The company aims to increase the actual exposure of its intellectual property through various offline channels, including exhibitions and cultural events, to attract a broader audience[19].