创梦天地(01119) - 2025 - 中期业绩

Financial Performance Summary The company achieved a significant turnaround, reporting a period profit for the first half of 2025, driven by a substantial increase in adjusted period profit Financial Performance Summary for the Six Months Ended June 30, 2025 | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Revenue | 685,798 | 845,223 | | Gross Profit | 289,488 | 291,786 | | Profit/(Loss) Before Income Tax | 34,741 | (107,393) | | Profit/(Loss) for the Period | 32,952 | (109,279) | | Adjusted Period Profit* | 95,139 | 3,297 | - The company achieved a period profit of RMB 32,952 thousand in the first half of 2025, a significant turnaround from a loss of RMB 109,279 thousand in the same period of 2024[4] - Adjusted period profit significantly increased to RMB 95,139 thousand, representing a year-on-year growth of approximately 2785%, indicating a substantial improvement in core business profitability[4] Business Review The company's business review highlights robust growth in overseas game publishing, strong performance from self-developed titles, and the effective integration of AI capabilities across operations Overseas Premium Game Publishing Business The company's overseas premium game publishing business maintains steady growth, with evergreen titles continuing to generate revenue and new games in reserve poised for launch - Subway Surfers maintains strong vitality 13 years after its launch, consistently ranking among the top downloads through content updates and IP collaborations, with its paid user rate increasing by nearly 30% compared to 2024[5] - Gardenscapes and Homescapes series show steady growth, with 6 versions launched and multiple IP collaborations in the first half of the year, leading to an average daily active user payment increase of over 9% year-on-year[6] - Mech Arena community engagement surged, with a collaboration version with a Gundam designer in June achieving a record-high average daily active user payment on its launch day, and the Fanbook community user base increasing by over 36.6% compared to the end of 2024[6] - A rich pipeline of new games includes Rush Royale (overseas revenue of nearly USD 300 million, global downloads exceeding 80 million) and Super Slime Simulator (overseas revenue exceeding USD 70 million), expected to drive new growth upon domestic launch[7] Self-Developed Business The self-developed business is progressively delivering results, with Calabiyau PC achieving high-quality growth and its mobile version expected to launch this year, while Delta Force: Hawk Ops, co-developed with Tencent, has launched globally with impressive performance - Calabiyau PC's MAU increased by 9.9% in the first half of 2025, revenue grew by 74.8%, and the paid user rate and average monthly active user payment increased by 23.2% and 59.0% respectively[8] - The Calabiyau Carnival event attracted nearly 5,000 players, with online live broadcast peak viewership exceeding 1 million, and the mobile version is announced for official launch within the year[8][9] - Delta Force: Hawk Ops has launched globally on both PC and mobile, with its daily active user base exceeding 20 million in July, ranking among the top five in domestic daily active users and top three in game revenue[10] AI Capability Application The company is fully integrating AI capabilities across R&D, user services, and gaming experience, significantly enhancing organizational efficiency, optimizing user experience, and achieving cost reduction and efficiency gains - AI code assistants fully cover technical development roles, improving overall R&D efficiency by over 30%, and an AI code review platform has been launched to enhance code and game product quality[12] - AI capabilities are applied in art design, game version internationalization, and automated testing, serving as a key driver for the company's cost reduction, efficiency improvement, and quality enhancement[12] - The self-developed global user voice AI listening platform "Fengsheng" enhances strategy response and operational iteration efficiency, contributing to a 24% increase in Calabiyau's Steam positive review rate and over 30% improvement in KOL connection efficiency[12] - The AI customer service system covers multiple platforms and supports multiple languages, with a knowledge base co-built with Alibaba Cloud's Tongyi achieving 75% self-resolution for high-frequency issues, a 40% decrease in manual intervention rate, and an accuracy rate of 93%[12] Management Discussion and Analysis This section provides an in-depth analysis of the company's financial performance, focusing on revenue, cost, and expense trends, highlighting a significant turnaround in profitability for the period Revenue Analysis For the six months ended June 30, 2025, the company's total revenue decreased by 18.9% year-on-year, primarily due to the late lifecycle revenue decline of All-Star Glory, though game business still constitutes the vast majority of total revenue Revenue Composition and Year-on-Year Change | Revenue Category | 2025 (RMB thousands) | Proportion (%) | 2024 (RMB thousands) | Proportion (%) | Year-on-Year Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | Game Revenue | 668,968 | 97.5 | 822,238 | 97.3 | -18.6 | | Information Service Revenue | 13,590 | 2.0 | 17,618 | 2.1 | -22.9 | | Other Revenue | 3,240 | 0.5 | 5,367 | 0.6 | -39.6 | | Total Revenue | 685,798 | 100.0 | 845,223 | 100.0 | -18.9 | - Game revenue decreased by 18.6%, mainly due to All-Star Glory entering its mid-to-late lifecycle, leading to a decline in revenue, but its marketing expenses significantly decreased, improving profit margins[15] - Information service revenue decreased by 22.9%, primarily due to the company's proactive strategy adjustment to reduce in-app advertising and enhance user experience[16] Cost and Expense Analysis The company effectively controlled cost of revenue and R&D expenses during the reporting period, while selling and marketing expenses increased, indicating an optimized overall expense structure Cost of Revenue Cost of revenue decreased by 28.4% year-on-year, and its percentage of revenue also dropped from 65.5% to 57.8%, primarily due to the increased revenue contribution from self-developed and newly launched products, which have lower cost of revenue ratios Cost of Revenue and Proportion Change | Indicator | 2025 (RMB thousands) | Proportion of Revenue (%) | 2024 (RMB thousands) | Proportion of Revenue (%) | Year-on-Year Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | Cost of Revenue | 396,310 | 57.8 | 553,437 | 65.5 | -28.4 | Selling and Marketing Expenses Selling and marketing expenses increased by 39.4% year-on-year, mainly due to increased market promotion expenditures for Calabiyau overseas PC and the newly launched game Legendary Shop: Build & Battle at the beginning of the year Selling and Marketing Expenses and Proportion Change | Indicator | 2025 (RMB thousands) | Proportion of Revenue (%) | 2024 (RMB thousands) | Proportion of Revenue (%) | Year-on-Year Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | Selling and Marketing Expenses | 108,429 | 15.8 | 77,766 | 9.2 | 39.4 | General and Administrative Expenses General and administrative expenses remained largely stable at approximately RMB 47.1 million General and Administrative Expenses | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | General and Administrative Expenses | 47,098 | 50,381 | Research and Development Expenses Research and development expenses significantly decreased by 68.2%, primarily due to the progressive completion of Calabiyau R&D and the application of AI technology across game development stages, which substantially improved R&D efficiency and reduced costs Research and Development Expenses and Proportion Change | Indicator | 2025 (RMB thousands) | Proportion of Revenue (%) | 2024 (RMB thousands) | Proportion of Revenue (%) | Year-on-Year Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | Research and Development Expenses | 48,743 | 7.1 | 153,286 | 18.1 | -68.2 | Net Impairment Loss on Financial Assets Net impairment loss on financial assets decreased year-on-year, from RMB 82.2 million to RMB 36.2 million Net Impairment Loss on Financial Assets | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Net Impairment Loss on Financial Assets | 36,229 | 82,162 | Net Finance Costs Net finance costs decreased by 42.9% year-on-year, primarily due to lower interest costs resulting from a decrease in bank loan interest rates Net Finance Costs | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Net Finance Costs | 28,397 | 49,741 | Income Tax Expense Income tax expense remained stable at approximately RMB 1.8 million Income Tax Expense | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Income Tax Expense | 1,789 | 1,886 | Profit/(Loss) for the Period The company achieved a period profit of RMB 33.0 million during the reporting period, a significant turnaround from a loss of RMB 109.3 million in the same period last year Profit/(Loss) for the Period | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Profit/(Loss) for the Period | 32,952 | (109,279) | Other Financial Information This section provides additional financial details, including non-IFRS measures, liquidity, contingent liabilities, capital expenditure, and foreign exchange risk management Non-IFRS Financial Measures The company uses non-IFRS measures such as adjusted period profit, EBITDA, and adjusted EBITDA to more clearly assess operating performance by excluding the impact of non-indicative or non-recurring items Non-IFRS Financial Measures | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Adjusted Period Profit | 95,139 | 3,297 | | EBITDA | 110,863 | 11,719 | | Adjusted EBITDA | 164,216 | 100,087 | - Adjusted period profit significantly increased year-on-year, and both EBITDA and adjusted EBITDA also showed substantial growth, reflecting an improvement in the company's profitability and cash flow position[26] Reconciliation of Profit/(Loss) for the Period and Adjusted Period Profit | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Profit/(Loss) for the Period | 32,952 | (109,279) | | Add: Interest expense on convertible bonds | 8,834 | 24,208 | | Add: Fair value loss/(gain) on financial assets at fair value through profit or loss | 9,051 | (1,974) | | Add: Fair value loss on financial liabilities at fair value through profit or loss | 2,000 | — | | Add: Share-based payment expense | 5,972 | 4,005 | | Add: Exchange loss/(gain) | 101 | (3,246) | | Add: Net impairment loss on financial assets | 36,229 | 82,162 | | Add: Impairment loss on prepayments | — | 7,421 | | Adjusted Period Profit | 95,139 | 3,297 | Liquidity and Financial Resources The company maintains a prudent financial management policy, with a decrease in cash and cash equivalents but also a reduction in total borrowings, leading to improved current, gearing, and capital gearing ratios, indicating a stable financial position Cash and Cash Equivalents As of June 30, 2025, total cash and cash equivalents were approximately RMB 105.0 million, a 46.7% decrease from December 31, 2024 Cash and Cash Equivalents | Indicator | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Cash and Cash Equivalents | 105,013 | 196,926 | -46.7 | Borrowings As of June 30, 2025, total borrowings were approximately RMB 994.1 million, a decrease from December 31, 2024, primarily consisting of secured bank borrowings Total Borrowings Composition | Borrowing Category | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Secured bank borrowings | 979,079 | 1,055,075 | | Secured other borrowings | 15,000 | 15,000 | | Total Borrowings | 994,079 | 1,070,075 | Current Ratio and Gearing Ratio The current ratio decreased from 0.90 to 0.85, and the gearing ratio decreased from 59.5% to 56.5%, indicating a slight tightening of liquidity but an overall improvement in the debt level Current Ratio and Gearing Ratio | Indicator | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Current Ratio | 0.85 | 0.90 | | Gearing Ratio | 56.5% | 59.5% | Capital Gearing Ratio The capital gearing ratio decreased from 75.0% as of December 31, 2024, to 67.1% as of June 30, 2025, reflecting an optimization of the capital structure Capital Gearing Ratio | Indicator | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Capital Gearing Ratio | 67.1% | 75.0% | Pledge of Borrowings As of June 30, 2025, approximately 70.3% of total borrowings were pledged by certain right-of-use assets, construction in progress, trade receivables, game intellectual property, and deposits - Approximately RMB 698.7 million of the borrowings were pledged by certain right-of-use assets, construction in progress, certain trade receivables, certain game intellectual property, and certain deposits of the Group[35] - Pledged borrowings accounted for 70.3% of total borrowings, slightly lower than 70.8% as of December 31, 2024[35] Contingent Liabilities As of June 30, 2025, the Group had no significant unrecorded contingent liabilities or guarantees - As of June 30, 2025, the Group had no significant unrecorded contingent liabilities or guarantees made[36] Capital Expenditure For the six months ended June 30, 2025, total capital expenditure was approximately RMB 86.0 million, primarily for copyright fees, construction in progress, and the acquisition of property, plant, and equipment, representing a year-on-year increase Capital Expenditure | Indicator | 2025 (RMB millions) | 2024 (RMB millions) | | :--- | :--- | :--- | | Total Capital Expenditure | 86.0 | 58.7 | - Capital expenditure primarily includes copyright fees paid, construction in progress, and the purchase of property, plant, and equipment[37] Material Acquisitions and Disposals and Material Investments During the reporting period, the Group did not undertake any material acquisitions, disposals, or material investments - For the six months ended June 30, 2025, the Group did not undertake any material acquisitions, disposals, or material investments[38] Foreign Exchange Risk Management The Group faces foreign exchange risks from multiple currencies including RMB, HKD, and USD, which are managed through regular reviews and natural hedging, but no foreign exchange fluctuations were hedged during the reporting period - The Group operates international businesses and is exposed to foreign exchange risks arising from various currencies including RMB, HKD, and USD[39] - The Group manages these risks by regularly reviewing net foreign exchange exposures and through natural hedging[39] - No foreign exchange fluctuations were hedged for the six months ended June 30, 2025, and 2024[40] Employees and Remuneration Policy, Retirement Schemes and Training Programs This section outlines the company's human resources, including a decrease in full-time employees, its remuneration policy designed to attract and retain talent, and diverse training programs aimed at enhancing professional skills Number of Full-time Employees | Date | Number of Full-time Employees | | :--- | :--- | | June 30, 2025 | 702 | | December 31, 2024 | 852 | - The company's number of full-time employees has decreased, but it remains committed to attracting, retaining, and motivating qualified staff[41] - The remuneration policy includes basic salary, performance bonuses, share awards, and commercial health and accident insurance, with plans to continue granting share awards to incentivize employees[41] - Diverse training programs are provided to employees, covering talent management, role-specific training (e.g., customer service, compliance management), Techtalk events, new graduate onboarding, and employee sharing activities, to enhance professional skills and comprehensive capabilities[42] Financial Statements This section presents the interim condensed consolidated financial statements, including the statement of comprehensive income and statement of financial position, reflecting the company's financial performance and position Interim Condensed Consolidated Statement of Comprehensive Income This section presents the unaudited consolidated statement of comprehensive income for the six months ended June 30, 2025, showing the company's shift from a loss to a profit compared to the same period last year, primarily due to improved operating profit and reduced finance costs Interim Condensed Consolidated Statement of Comprehensive Income (Summary) | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Revenue | 685,798 | 845,223 | | Gross Profit | 289,488 | 291,786 | | Operating Profit/(Loss) | 45,311 | (54,624) | | Net Finance Costs | (28,397) | (49,741) | | Profit/(Loss) Before Income Tax | 34,741 | (107,393) | | Profit/(Loss) for the Year | 32,952 | (109,279) | | Total Comprehensive Income/(Loss) for the Period | 33,661 | (104,238) | | Profit/(Loss) for the Period Attributable to Owners of the Company | 28,514 | (109,817) | Interim Condensed Consolidated Statement of Financial Position This section provides the unaudited consolidated statement of financial position as of June 30, 2025, reflecting changes in the structure of assets, liabilities, and equity, with both total assets and total liabilities showing a decrease Interim Condensed Consolidated Statement of Financial Position (Summary) | Indicator | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Total Assets | 3,512,143 | 3,590,220 | | Current Assets | 1,349,611 | 1,567,037 | | Cash and Cash Equivalents | 105,013 | 196,926 | | Total Equity | 1,528,301 | 1,455,368 | | Total Liabilities | 1,983,842 | 2,134,852 | | Current Liabilities | 1,588,146 | 1,735,915 | | Borrowings (Total) | 994,079 | 1,070,075 | Notes to the Financial Statements This section provides detailed notes to the financial statements, covering general information, basis of preparation, significant accounting policies, segment information, expense analysis, and other financial details General Information This note provides basic information about iDreamSky Technology Holdings Limited, including its place of incorporation, primary business (game development and operation in China), and listing on the Hong Kong Stock Exchange - The Company is incorporated in the Cayman Islands and primarily engaged in game development and operation in China[50] - The Company's shares have been listed on the Main Board of the Stock Exchange of Hong Kong since December 6, 2018[50] Basis of Preparation The interim financial information is prepared in accordance with International Accounting Standard 34 "Interim Financial Reporting" and should be read in conjunction with the 2024 annual consolidated financial statements - The interim financial information is prepared in accordance with International Accounting Standard 34 "Interim Financial Reporting"[51] - This information should be read in conjunction with the Group's annual consolidated financial statements for the year ended December 31, 2024[51] Significant Accounting Policies The accounting policies adopted in the preparation of the interim financial information are consistent with those used for the 2024 financial statements, and the adoption of new and revised standards is not expected to have a material impact on the financial position and operating results - The accounting policies adopted in the preparation of the interim financial information are consistent with those used for the 2024 financial statements[52] - The adoption of new and revised standards is not expected to have any significant impact on the interim condensed consolidated financial information[53][57] Segment Information The Group considers its operations as a single reportable segment (games and information services), with key operating decision-makers assessing performance based on segment revenue, cost of revenue, gross profit, and segment results, with revenue primarily derived from China - The Group's operations are operated and managed as a single reportable segment (games and information services)[58] - The chief operating decision-maker assesses the performance of the operating segment based on segment revenue, cost of revenue, gross profit, and segment results[58] Revenue from Games and Information Services | Revenue Category | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Game Revenue | 668,968 | 822,238 | | Information Service Revenue | 13,590 | 17,618 | | Other | 3,240 | 5,367 | | Total | 685,798 | 845,223 | Timing of Revenue Recognition by Category | Timing of Recognition | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | At a point in time | 485,875 | 438,444 | | Over time | 199,923 | 406,779 | | Total | 685,798 | 845,223 | Expense Analysis This section details the various expenses included in cost of revenue, selling and marketing expenses, general and administrative expenses, and research and development expenses, showing a significant decrease in employee benefit expenses and revenue sharing with content providers Expense Analysis | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Channel costs | 212,881 | 277,059 | | Revenue sharing with content providers | 110,014 | 217,079 | | Employee benefit expenses | 80,462 | 147,361 | | Promotion and advertising expenses | 98,758 | 70,191 | | Service fees for game development and other technical development | 6,954 | 37,416 | | Cloud computing, bandwidth and server hosting fees | 23,547 | 18,948 | | Amortisation of intangible assets | 37,877 | 30,129 | | Professional service fees | 12,309 | 6,148 | | Depreciation of right-of-use assets | 5,897 | 6,021 | | Travel and entertainment expenses | 3,850 | 6,375 | | Short-term leases and utilities expenses | 2,073 | 2,539 | | Depreciation of property, plant and equipment | 533 | 607 | | Impairment provision for prepayments | — | 7,421 | | Other tax expenses | 728 | 445 | | Depreciation of investment properties | 220 | 220 | | Others | 4,477 | 6,911 | | Total | 600,580 | 834,870 | Other Income and Net (Losses)/Gains This section presents the composition of other income and net other (losses)/gains, with government grants being the primary source of other income, and net other (losses)/gains comprising gains from disposal of financial assets and other items Other Income | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Government grants | 5,706 | 6,543 | | Others | 171 | 1,116 | | Total | 5,877 | 7,659 | Net Other (Losses)/Gains | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Gain on disposal of investments in associates and joint ventures | — | 5,073 | | Gain on disposal of financial assets | 1,669 | 1,850 | | Others | (2,173) | 629 | | Total | (504) | 7,552 | Income Tax Expense This section analyzes the income tax expense for the six months ended June 30, 2025, primarily consisting of deferred income tax, with the total amount remaining largely consistent with the prior year Income Tax Expense Analysis | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Current income tax | — | 46 | | Deferred income tax | 1,789 | 1,840 | | Income Tax Expense | 1,789 | 1,886 | Earnings/(Loss) Per Share and Dividends This section details the calculation of basic and diluted earnings per share, showing the company's shift from a loss to a profit per share, and confirms that the Board did not declare an interim dividend Basic Earnings/(Loss) Per Share | Indicator | 2025 | 2024 | | :--- | :--- | :--- | | Profit/(Loss) attributable to owners of the Company (RMB thousands) | 28,514 | (109,817) | | Weighted average number of ordinary shares in issue (thousand shares) | 1,693,786 | 1,570,305 | | Basic Earnings/(Loss) Per Share (RMB) | 0.02 | (0.07) | Diluted Earnings/(Loss) Per Share | Indicator | 2025 | 2024 | | :--- | :--- | :--- | | Profit/(Loss) attributable to owners of the Company (RMB thousands) | 28,514 | (109,817) | | Weighted average number of shares for diluted earnings per share (thousand shares) | 1,811,794 | 1,570,305 | | Diluted Earnings/(Loss) Per Share (RMB) | 0.02* | (0.07) | - For the six months ended June 30, 2025, the share award scheme and convertible bonds had an anti-dilutive effect, thus the diluted earnings per share is equal to the basic earnings per share[73] - The Board has resolved not to declare an interim dividend for the six months ended June 30, 2025[74] Trade Receivables Total trade receivables decreased, with most due within 3 months, and the company has made impairment provisions and written off some amounts, while certain receivables are pledged for bank financing Total Trade Receivables | Item | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Third parties | 201,536 | 320,642 | | Related parties | 26,493 | 2,150 | | Less: Impairment provision | (127,589) | (164,378) | | Net | 100,440 | 158,414 | Ageing Analysis of Trade Receivables | Ageing | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Within 3 months | 80,488 | 102,335 | | 3 months to 1 year | 996 | 697 | | 1 to 2 years | 19,999 | 53,119 | | 2 to 3 years | 93,334 | 166,536 | | Over 3 years | 33,212 | 105 | | Total | 228,029 | 322,792 | - The Group wrote off trade receivables of RMB 73,206,000, primarily due to insufficient repayment ability of certain customers and business partners[81] - As of June 30, 2025, trade receivables of RMB 29,546,000 were pledged to secure bank financing[80] Prepayments and Other Receivables Total prepayments and other receivables decreased, mainly comprising prepayments for revenue sharing with content providers and advertising expenses, with impairment provisions made for game-related prepayments that were underperforming or not aligned with future strategies Total Prepayments and Other Receivables | Item | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Prepayments (net) | 858,752 | 875,972 | | Other receivables (net) | 101,357 | 194,223 | | Total | 960,109 | 1,070,195 | - Prepayments for revenue sharing with content providers and prepayments for advertising expenses are the main components of prepayments[86] - Impairment provisions primarily target prepayments for revenue sharing with game developers, involving games that are underperforming or not aligned with future strategies[87] - The Group will continue to adjust and optimize its product portfolio, gradually discontinuing products that no longer align with its future game business strategy[87] Convertible Bonds This section details the convertible bonds due in 2028, including their principal, interest rate, conversion price adjustments, and accounting treatment for liability and equity components, noting no conversions occurred during the reporting period - The Group entered into a subscription agreement on July 24, 2023, for the issuance of convertible bonds due in 2028 with a total principal amount of HKD 386,000,000 (approximately RMB 352,804,000) and an initial conversion price of HKD 3.64 per share[88] - Due to the issuance of placing shares, the conversion price of the convertible bonds has been adjusted from HKD 3.64 to HKD 3.58 per share, effective from July 31, 2024[88] Movements in 2028 Convertible Bonds | Item | Liability (RMB thousands) | Other Reserves (RMB thousands) | Total (RMB thousands) | | :--- | :--- | :--- | :--- | | As at January 1, 2025 | 275,608 | 126,702 | 402,310 | | Interest expense | 8,834 | — | 8,834 | | Interest paid | (8,882) | — | (8,882) | | Currency translation difference | (4,193) | — | (4,193) | | As at June 30, 2025 | 271,367 | 126,702 | 398,069 | - Interest expense is calculated using an effective annual interest rate of 16.07% for the liability component[91] - As of June 30, 2025, no 2028 convertible bonds have been converted[92] Borrowings This section provides detailed information on borrowings, including the composition of non-current and current borrowings, weighted average annual interest rates, and various collateral arrangements Borrowings Composition | Item | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Included in non-current liabilities (secured bank borrowings) | 124,329 | 123,329 | | Included in current liabilities (secured bank borrowings) | 814,750 | 903,746 | | Included in current liabilities (current portion of secured long-term bank borrowings) | 40,000 | 28,000 | | Included in current liabilities (secured other borrowings) | 15,000 | 15,000 | | Total | 994,079 | 1,070,075 | - The weighted average annual interest rate for long-term bank borrowings was 3.66% (2024: 3.79%), and for short-term bank borrowings was 3.85% (2024: 4.46%)[93] - Borrowings are secured by deposits and shares of subsidiaries, guarantees provided by the Company and/or subsidiaries, pledges of Group assets (such as trade receivables, intellectual property), and pledged certificates of deposit[94] Borrowings Maturity Dates | Maturity Date | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Within 1 year | 869,750 | 946,746 | | 1 to 2 years | 53,029 | 47,015 | | 2 to 5 years | 30,090 | 30,090 | | Over 5 years | 41,210 | 46,224 | | Total | 994,079 | 1,070,075 | Trade Payables Total trade payables decreased, primarily related to server hosting services, game licenses, and revenue sharing with partner game developers, with a typical credit period of 3 months Ageing Analysis of Trade Payables | Ageing | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Within 3 months | 25,371 | 108,944 | | 3 months to 1 year | 297,500 | 147,700 | | 1 to 2 years | 29,037 | 120,393 | | 2 to 5 years | 1,512 | 1,728 | | Total | 353,420 | 378,765 | Other Information This section covers various other important information, including dividend policy, corporate governance compliance, securities trading standards, share repurchases, audit committee review, and post-reporting period events Dividends The Board did not declare an interim dividend for the six months ended June 30, 2025 - The Board did not declare any interim dividend for the six months ended June 30, 2025[96] Compliance with Corporate Governance Code The company has adopted the Corporate Governance Code set out in Appendix C1 of the Listing Rules and complied with all applicable provisions during the reporting period, despite the Chairman and CEO roles being held by the same person, an arrangement the Board believes is in the company's best interest - The Company has adopted the Corporate Governance Code set out in Appendix C1 to the Listing Rules as its own corporate governance code[97] - Mr Chen Xiangyu concurrently holds the roles of Chairman and Chief Executive Officer, an arrangement the Board believes helps maintain the continuity of the Company's policies and operational stability[97] - Save as disclosed above, the Company has complied with all applicable code provisions of the Corporate Governance Code during the reporting period[98] Standard Code for Securities Transactions The company has adopted the Standard Code set out in Appendix C3 of the Listing Rules, and all directors confirmed compliance with the code during the reporting period - The Company has adopted the Standard Code set out in Appendix C3 to the Listing Rules as its own code of conduct regarding securities transactions by directors[99] - Each Director has confirmed that they have complied with the required standards set out in the Standard Code during the six months ended June 30, 2025[99] Purchase, Sale or Redemption of Listed Securities For the six months ended June 30, 2025, the company repurchased 20,856,800 shares on the Stock Exchange for a total consideration of HKD 35,791,300, holding 23,390,000 treasury shares at period-end Share Repurchase Details | Month | Number of Shares Repurchased | Total Consideration (before expenses, HKD) | | :--- | :--- | :--- | | January 2025 | 20,856,800 | 35,791,300 | | Total | 20,856,800 | 35,791,300 | - As of the end of the reporting period, the Company held 23,390,000 treasury shares[101] Audit Committee The Audit Committee has reviewed the Group's unaudited consolidated financial statements, interim results announcement, accounting standards and practices for the six months ended June 30, 2025, and discussed matters related to risk management, internal control, and financial reporting - The Audit Committee has reviewed the Group's unaudited consolidated financial statements for the six months ended June 30, 2025, and this interim results announcement[102] - The Audit Committee has also reviewed the accounting standards and practices adopted by the Group and discussed and reviewed matters relating to risk management, internal control, and financial reporting[102] Events After the Reporting Period On July 28, 2025, the company announced the placement and issuance of 38,085,937 shares to PLR Worldwide Sales Limited, with gross proceeds of approximately HKD 38,999,999.488, intended to offset royalties payable to the subscriber - On July 28, 2025, the Company announced the placement and issuance of a total of 38,085,937 shares to the subscriber, PLR Worldwide Sales Limited[103] - The gross proceeds from the subscription shares amounted to approximately HKD 38,999,999.488, and the issuance was completed on August 11, 2025[103] - This subscription aims to offset royalties payable by Shenzhen iDreamSky to the subscriber on an equivalent basis[103] Publication of Interim Results and 2025 Interim Report This interim results announcement has been published on the Stock Exchange website and the company's website, and the interim report will be published in due course - This interim results announcement is published on the website of the Stock Exchange (www.hkexnews.hk) and the Company's website (www.idreamsky.com)[104](index=104&type=chunk) - The Group's interim report (containing all information required by the Listing Rules) will be published on the websites of the Stock Exchange and the Company in due course[104] Definitions This section provides definitions for key terms and abbreviations used in the announcement to ensure consistent understanding of the report's content - Provides definitions for terms such as "Board", "Super Endless", "Alibaba Cloud Tongyi", "Audit Committee", "Board", "Corporate Governance Code", "Company", "Group", "HKD", "Hong Kong", "IAS", "IFRS", "IP", "KOC", "KOL", "Listing Rules", "MAU", "Standard Code", "China", "PRC Consolidated Affiliated Entities", "PVE", "Reporting Period", "RMB", "Shares", "Shenzhen iDreamSky", "Steam", "Stock Exchange", "Tencent", "Tencent Cloud", "Tencent Group", "Treasury Shares", "Subsidiary", "USD", and "%"[105][106][107][108][110]