联众(06899) - 2025 - 中期业绩

Financial Highlights The company released its unaudited interim results for the six months ended June 30, 2024, showing a 5.6% year-on-year increase in revenue and a significant 70.2% reduction in loss attributable to equity holders Financial Highlights for the Six Months Ended June 30 | Indicator | 2024 (RMB thousands) | 2023 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 50,155 | 47,515 | 5.6% | | Loss for the period attributable to owners of the company | (19,770) | (66,436) | (70.2%) | | Basic loss per share (continuing and discontinued operations) | (1.84) | (6.20) | (70.3%) | | Basic loss per share (continuing operations) | (1.84) | (1.96) | (6.1%) | Business Review Despite intense market competition, the company achieved stable business development in the first half by optimizing core card and board game operations, advancing strategic cooperation with China Mobile Migu, expanding event content influence, and actively recovering non-performing assets, laying a foundation for future growth Core Business Development The company's core card and board game platform (Lianzhong Lobby) successfully enhanced user activity, stickiness, payment conversion rates, and ARPU through micro-innovations, optimized event planning, and user recall strategies, achieving the goal of 'stable growth with optimized efficiency' - The core card and board game business (Lianzhong Lobby) achieved stable user activity, continuously optimized stickiness, and steadily increased payment conversion rates and ARPU through micro-innovations in gameplay, optimized event planning, user recall, and payment guidance strategies[5] Strategic Cooperation and New Market Exploration The company formed a strategic partnership with China Mobile Migu to co-develop the Guandan game, expected to launch in H2 2025, while expanding the influence of professional card and board game PGC content and actively exploring 'Card & Board Game+' new models - A strategic partnership was formed with China Mobile Migu to co-develop the Guandan game, anticipated to launch in H2 2025 as a new growth engine[6] - The influence of professional card and board game PGC content on live streaming platforms like Douyin, Kuaishou, and Huya continues to expand, with significant growth in key metrics such as event live broadcast exposure, viewership, and topic popularity[7] - Actively exploring new domestic and international market opportunities and 'Card & Board Game+' possibilities, including integrating AI technology, metaverse concepts, and promoting local distinctive card and board game culture, while seeking strategic cooperation or investment and M&A opportunities[8] Asset Recovery Progress The current board and management continue to pursue overdue receivables and non-performing assets left by the former management, having recovered substantial assets and will continue to take legal action to protect company and shareholder interests - The current board and management are actively pursuing overdue receivables and non-performing assets, including historical investments, left by former management (including Mr. Wu Guoliang), having recovered a significant amount of assets[8] Management Discussion and Analysis This section provides a detailed analysis of the Group's financial performance for the six months ended June 30, 2024, covering revenue, costs, expenses, liquidity, significant investments, and employee policies, explaining the changes in various financial indicators Financial Review The Group's loss for the period significantly narrowed, revenue increased, and gross profit margin improved, while other income decreased, reflecting efforts in cost reduction and efficiency improvement - Loss attributable to equity holders of the company was RMB 19.8 million, a significant 70.2% reduction from RMB 66.4 million in the prior year period[9] Key Financial Indicators Changes | Indicator | 2024 (RMB millions) | 2023 (RMB millions) | Change (RMB millions) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Revenue | 50.2 | 47.5 | 2.7 | 5.6% | | Cost of revenue | 23.2 | 23.8 | (0.6) | (2.6%) | | Gross Profit Margin | 53.8% | 50.0% | 3.8% | - | | Other Income | 2.8 | 4.9 | (2.1) | (42.9%) | | Other Gains and Losses | (0.2) | 3.8 | (4.0) | - | | Selling and Marketing Expenses | 6.0 | 7.0 | (1.0) | (14.7%) | | Administrative Expenses | 15.3 | 16.2 | (0.9) | (5.3%) | | Research and Development Expenses | 3.7 | 10.4 | (6.7) | (64.2%) | | Fair Value Change Loss on Financial Assets at FVTPL | 10.2 | 10.8 | (0.6) | (5.6%) | | Income Tax Expense | 0 | 0.2 | (0.2) | (100%) | Liquidity and Sources of Funds and Borrowings The Group's total bank balances and cash increased, primarily due to new bank borrowings, maintaining a healthy current ratio, while the gearing ratio rose from zero due to new borrowings - Total bank balances and cash increased by 13.3% to RMB 40.2 million, primarily due to new bank borrowings[20] Liquidity Ratios | Indicator | June 30, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Current Assets (RMB millions) | 82.7 | 73.4 | | Current Liabilities (RMB millions) | 38.9 | 33.2 | | Current Ratio | 2.13 | 2.21 | | Gearing Ratio | 7.6% | 0% | Significant Investments and Acquisitions/Disposals The Group had no significant acquisitions or disposals during the period, with financial assets at fair value through profit or loss decreasing, primarily invested in startups and private equity funds related to gaming or intellectual sports technology R&D for strategic synergy - There were no significant investments, acquisitions, or disposals during the period[21][22][27] - Financial assets at fair value through profit or loss amounted to RMB 14.2 million (December 31, 2023: RMB 26.5 million), primarily invested in selected startups (gaming or intellectual sports-related technology R&D) and private equity funds[23][24] Changes in Financial Assets at Fair Value Through Profit or Loss | Item | RMB (thousands) | | :--- | :--- | | Balance as at January 1, 2024 | 26,469 | | Disposals | (2,044) | | Fair value changes recognized in profit or loss | (10,210) | | Fair value as at June 30, 2024 | 14,215 | Pledge of Assets and Contingent Liabilities As of June 30, 2024, the Group had no pledged assets or significant contingent liabilities - As of June 30, 2024, the Group had no pledged assets[28] - As of June 30, 2024, the Group had no significant contingent liabilities[29] Foreign Exchange Risk The Group primarily operates in China with most transactions settled in RMB, thus incurring no significant foreign exchange risk during the period - The Group primarily operates in China, with most transactions settled in RMB, and thus had no significant foreign exchange risk during the period[30] Employee Remuneration and Policies As of June 30, 2024, the Group had 67 employees, with total remuneration expenses increasing by 12.0% year-on-year - The Group had 67 employees, with total remuneration expenses (including share-based payment expenses) of RMB 13.1 million, representing a 12.0% year-on-year increase[31] Post-Reporting Period Events and Future Plans No significant events have occurred since the end of the reporting period, and there are no other future plans regarding major investments and capital assets - No significant events have occurred since the end of the six months ended June 30, 2024[32] - Except as disclosed, the Group has no other future plans regarding significant investments and capital assets[33] Corporate Governance and Other Information The company is committed to maintaining strict corporate governance policies, disclosing compliance with the Corporate Governance Code and the Model Code for Securities Transactions by Directors, the audit committee's operations, and updates on several significant litigation matters Compliance with Corporate Governance Code The company has complied with the applicable provisions of the Corporate Governance Code, with a previous deviation regarding the separation of Chairman and CEO roles now rectified after Ms. Xu Jin's appointment as CEO - The company has complied with the Corporate Governance Code set out in Appendix C1 to the Listing Rules, except for a previous deviation from Code Provision C.2.1 (the roles of chairman and chief executive should be separate)[35] - Ms. Xu Jin was appointed as Executive Director and Chief Executive Officer, and Mr. Lu Jingsheng was re-designated as Chief Financial Officer and continues as Chairman, thereby separating the roles of Chairman and Chief Executive Officer[35] Compliance with Model Code for Securities Transactions by Directors All directors confirmed strict compliance with the Model Code for Securities Transactions by Directors, as set out in Appendix C3 to the Listing Rules, during the reporting period - All Directors confirmed strict compliance with the required standards set out in the Model Code during the six months ended June 30, 2024[37] Audit Committee The Audit Committee, comprising three independent non-executive directors, is responsible for reviewing and overseeing internal controls and financial reporting, and has reviewed the Group's unaudited interim results - The Audit Committee comprises three independent non-executive Directors (Mr. Zhang Li, Mr. Ma Shaohua, and Mr. Dai Bing), with Mr. Zhang Li serving as Chairman[38] - The Audit Committee has reviewed the Group's unaudited interim results and interim report for the six months ended June 30, 2024[38] Dealings in Listed Securities Neither the company nor its subsidiaries purchased, sold, or redeemed any of the company's listed securities during the reporting period, and the company held no treasury shares - Neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities[39] - The company held no treasury shares as of June 30, 2024[40] Significant Litigation Matters The company is involved in several significant legal proceedings, including arbitration and litigation against Fast Through Trading Co., Ltd. for loans, and arbitration enforcement procedures against Spoville Co., Ltd. for convertible bonds, all of which are ongoing Fast Through Trading Co., Ltd. Loan and Related Litigation The company initiated arbitration and civil litigation against Merit Horizon and former non-executive director Ms. Fu Qiang regarding the Fast Through Trading Co., Ltd. loan and Merit Horizon Limited's guarantee agreement, claiming no less than HK$97,948,090.47, with arbitration hearings concluded and litigation ongoing - The company initiated arbitration against Merit Horizon before the Hong Kong arbitral tribunal for breach of the Merit Horizon loan agreement, claiming a total of no less than HK$97,948,090.47 from Merit Horizon[43] - The arbitration recently concluded significant hearings, but no award has been rendered yet[43] - The company filed civil lawsuits in the High Court of Hong Kong against Bright Wisdom, Ms. Fu (former director), and Mr. Gao Hong (former director), seeking repayment of loan principal and interest, and claiming damages for breach of fiduciary duties by Ms. Fu and Mr. Gao[44][45] Arbitration Proceedings Against Spoville Co., Ltd. The ICC International Court of Arbitration ruled that Spoville and Mr. Seung-Hwan Oh are jointly and severally liable to pay the company KRW 2,184,541,667 for convertible bond principal and interest, plus legal and arbitration fees; a Korean court has approved the recognition and enforcement of the award, with asset tracing underway for compulsory enforcement - The ICC International Court of Arbitration ruled that Spoville and Mr. Seung-Hwan Oh are jointly and severally liable to pay the company a total of KRW 2,184,541,667 for convertible bond principal and interest, plus legal fees of RMB 727,468 and arbitration costs of US$85,000[46] - A Korean court has issued a ruling agreeing to the recognition and enforcement of the arbitration award, and asset tracing is underway to apply for compulsory enforcement[47] Interim Dividend The Board of Directors does not recommend the declaration of any interim dividend for the six months ended June 30, 2024 - The Board of Directors does not recommend the declaration of any interim dividend for the six months ended June 30, 2024[48] Condensed Consolidated Financial Statements This section presents the Group's unaudited condensed consolidated statement of profit or loss and other comprehensive income and condensed consolidated statement of financial position for the six months ended June 30, 2024, showcasing the company's financial performance and period-end financial position Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income The Group's loss for the period from continuing operations was RMB 20,782 thousand, with a total comprehensive loss for the period of RMB 19,687 thousand, significantly narrowed compared to the prior year period Summary of Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income | Indicator | 2024 (RMB thousands) | 2023 (RMB thousands) | | :--- | :--- | :--- | | Loss for the period from continuing operations | (20,782) | (18,668) | | Loss for the period from discontinued operations | — | (43,957) | | Loss for the period | (20,782) | (62,625) | | Total comprehensive loss for the period | (19,687) | (107,900) | | Loss for the period attributable to owners of the company | (19,770) | (66,436) | | Basic loss per share (continuing and discontinued operations) | (1.84) | (6.2) | | Basic loss per share (continuing operations) | (1.84) | (1.96) | Condensed Consolidated Statement of Financial Position As of June 30, 2024, the Group's total assets were RMB 176,412 thousand, and net assets were RMB 131,168 thousand, a decrease compared to December 31, 2023 Summary of Condensed Consolidated Statement of Financial Position | Indicator | June 30, 2024 (RMB thousands) | December 31, 2023 (RMB thousands) | | :--- | :--- | :--- | | Non-current assets | 93,761 | 114,047 | | Current assets | 82,651 | 73,408 | | Current liabilities | 38,859 | 33,170 | | Net current assets | 43,792 | 40,238 | | Total assets less current liabilities | 137,553 | 154,285 | | Non-current liabilities | 6,385 | 3,396 | | Net assets | 131,168 | 150,889 | | Total equity | 131,168 | 150,889 | Notes to the Condensed Consolidated Financial Statements This section provides detailed notes to the condensed consolidated financial statements, explaining the basis of preparation, restatement matters, revenue and segment information, composition of various income and expenses, impact of discontinued operations, earnings per share calculation, interests in associates, receivables and payables, and updates on other litigation and arbitration Basis of Preparation The condensed consolidated financial statements are prepared in accordance with IAS 34 'Interim Financial Reporting' and applicable disclosure requirements of the HKEX Listing Rules, with no significant impact from IFRS amendments during the period - The condensed consolidated financial statements are prepared in accordance with International Accounting Standard 34 and the applicable disclosure requirements of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[53] - The application of amendments to International Financial Reporting Standards during the period had no significant impact on the Group's financial position and performance[54] Restatement The Group lost control over Allied Gaming & Entertainment Inc. (AGAE) on January 1, 2023, and sold a 40% equity interest in Lianzhong Zhihe, thus related businesses are presented as discontinued operations, and prior period financial statements have been restated - The company lost control over Allied Gaming & Entertainment Inc. (AGAE) on January 1, 2023, and its e-sports business has been separately presented as a discontinued operation[56] - The Group sold a 40% equity interest in its non-wholly owned subsidiary, Beijing Lianzhong Zhihe Technology Co., Ltd., and its casual mobile game business has also been separately presented as a discontinued operation[56] Revenue and Segment Information The Group's revenue from continuing operations primarily derived from online games, with a decrease in online advertising service revenue; all revenue originated from China, and no single customer accounted for over 10% of total revenue Revenue Breakdown from Continuing Operations | Revenue Source | 2024 (RMB thousands) | 2023 (RMB thousands) | | :--- | :--- | :--- | | Online game revenue | 44,302 | 40,002 | | Online advertising service revenue | 5,853 | 7,513 | | Total revenue | 50,155 | 47,515 | - All revenue was derived from China[60] - No revenue from any individual game player or customer accounted for 10% or more of the Group's revenue[61] Other Income The Group's total other income decreased to RMB 2,842 thousand from RMB 4,869 thousand in the prior year period, mainly due to reduced royalty income from discontinued operations and software sales Other Income Breakdown | Item | 2024 (RMB thousands) | 2023 (RMB thousands) | | :--- | :--- | :--- | | Royalty income from discontinued operations | 127 | 1,264 | | Sale of software to discontinued operations | — | 1,981 | | Income from providing card and board game venues | 2,212 | 1,256 | | Total | 2,842 | 4,869 | Other Gains and Losses The Group recorded other losses of RMB 192 thousand, compared to gains of RMB 3,772 thousand in the prior year period, primarily due to the absence of deemed gain on acquisition of interests in an associate this period Other Gains and Losses Breakdown | Item | 2024 (RMB thousands) | 2023 (RMB thousands) | | :--- | :--- | :--- | | Net foreign exchange gains | 110 | 10 | | Impairment loss on prepayments | (302) | — | | Deemed gain on acquisition of interests in an associate | — | 3,762 | | Total | (192) | 3,772 | Income Tax Expense The Group incurred no income tax expense for the six months ended June 30, 2024, compared to RMB 163 thousand in the prior year period - The Group incurred no income tax expense for the six months ended June 30, 2024[64] Discontinued Operations This section details the financial impact of discontinued operations, including a loss of RMB 46,895 thousand from the deemed disposal of AGAE Group and a profit of RMB 2,938 thousand from Lianzhong Zhihe's business before its 40% equity sale - The deemed disposal of AGAE Group resulted in a loss of RMB 46,895 thousand in the first half of 2023[66] - Lianzhong Zhihe's business generated a profit of RMB 2,938 thousand in the first half of 2023, after which the Group sold a 40% equity interest[67] Loss for the Period This section lists various expenses deducted from or included in the loss for the period from continuing operations, including lease expenses, depreciation, and employee costs, with employee costs showing an increase Loss for the Period Adjustment Items | Item | 2024 (RMB thousands) | 2023 (RMB thousands) | | :--- | :--- | :--- | | Lease expenses related to short-term leases | 124 | 176 | | Total depreciation | 474 | 2,616 | | Employee costs (including share-based payment expenses) | 13,109 | 11,712 | | Amortization of intangible assets | — | 624 | Dividends The Directors do not recommend the payment of an interim dividend for the six months ended June 30, 2024 - The Directors do not recommend the payment of an interim dividend for the six months ended June 30, 2024[69] Loss Per Share Basic loss per share from continuing operations improved to RMB 1.84 cents from RMB 1.96 cents in the prior year period, with no assumed exercise of share options/warrants for diluted EPS calculation Loss Per Share Calculation Data | Indicator | 2024 (RMB thousands) | 2023 (RMB thousands) | | :--- | :--- | :--- | | Loss used in calculating basic loss per share from continuing operations | (19,770) | (21,010) | | Weighted average number of ordinary shares for basic loss per share (thousands) | 1,072,197 | 1,071,447 | | Basic loss per share (continuing operations) (RMB cents) | (1.84) | (1.96) | | Basic loss per share (continuing and discontinued operations) (RMB cents) | (1.84) | (6.2) | - No exercise of the company's share options/warrants was assumed in calculating diluted earnings/loss per share, as their exercise prices were higher than the average market price of the shares[71] Interests in Associates The Group's interests in associates primarily refer to its 32.6% ownership interest in AGAE, which decreased due to its share of AGAE's losses, though AGAE's fair value increased - Interests in associates amounted to RMB 73,006 thousand (December 31, 2023: RMB 86,028 thousand), primarily representing the 32.6% ownership interest in AGAE[72] - The decrease in interests in AGAE was due to the share of AGAE's losses accounted for using the equity method[72] - The fair value of AGAE as of June 30, 2024, was approximately RMB 110,596 thousand (December 31, 2023: RMB 89,827 thousand)[72] Trade and Other Receivables The Group's total trade and other receivables increased to RMB 41,995 thousand from RMB 37,468 thousand as of December 31, 2023, comprising trade receivables, prepayments, other receivables, and loans and interest receivable, with expected credit loss provisions made Trade and Other Receivables Breakdown | Item | June 30, 2024 (RMB thousands) | December 31, 2023 (RMB thousands) | | :--- | :--- | :--- | | Trade receivables (net) | 1,636 | 763 | | Prepayments (net) | 10,336 | 9,107 | | Other receivables and deposits (net) | 12,170 | 9,745 | | Loans and interest receivable (net) | 17,853 | 17,853 | | Total | 41,995 | 37,468 | - The credit period for trade receivables is typically 30 to 90 days[75] Trade and Other Payables The Group's total trade and other payables decreased to RMB 22,431 thousand from RMB 27,502 thousand as of December 31, 2023, primarily including trade payables to third parties, other payables, and accrued expenses Trade and Other Payables Breakdown | Item | June 30, 2024 (RMB thousands) | December 31, 2023 (RMB thousands) | | :--- | :--- | :--- | | Trade payables (due to third parties) | 3,259 | 4,137 | | Other payables and accrued expenses | 10,692 | 7,067 | | Employee costs and accrued benefits | 3,058 | 4,654 | | Amounts due to associates | 2,853 | 4,328 | | Accrued legal and professional fees | 3,390 | 2,064 | | Total | 22,431 | 27,502 | Bank Borrowings As of June 30, 2024, the Group had new bank borrowings of RMB 10,000 thousand, unsecured, unguaranteed, bearing a fixed annual interest rate of 3.0%, and repayable within one year - New bank borrowings of RMB 10,000 thousand were unsecured, unguaranteed, bore a fixed annual interest rate of 3.0%, and were repayable within one year[76] Other Litigation/Arbitration The Group is involved in two major litigation/arbitration cases: Mr. Wu Guoliang's arbitration against AGAE, and two lawsuits by Knighted Pastures, LLC against AGAE and its directors, all ongoing with financial impacts not yet reasonably estimable Mr. Wu Guoliang's Arbitration Against AGAE Former executive director Mr. Wu Guoliang filed an arbitration case with the American Arbitration Association against AGAE for a US$1,000,000 debt, alleging a fraudulent settlement agreement; approximately US$645,000 previously collected has been transferred to an escrow account, with arbitration in the discovery phase and a hearing scheduled for early November 2025 - Mr. Wu Guoliang filed an arbitration case with the American Arbitration Association against AGAE for a US$1,000,000 debt, alleging the settlement agreement was fraudulent[78] - Approximately US$645,000 previously collected and recovered by the company has been transferred to an escrow account pending the conclusion of the arbitration[79] - The arbitration is currently in the discovery phase, with a hearing scheduled for early November 2025[78] Knighted Pastures, LLC Litigation Knighted Pastures, LLC filed two lawsuits against AGAE and its directors for alleged breach of fiduciary duties; the first was dismissed by the court, but AGAE paid US$3 million in legal fees; the second, concerning a strategic investment with Yellow River Capital, has been stayed by the court, and AGAE also sued Knighted for undisclosed 'group' actions - Knighted Pastures, LLC filed a lawsuit against AGAE directors, alleging breach of fiduciary duties, and the court accepted the motion to dismiss the lawsuit as moot[80][81] - The court accepted Knighted's claim for US$3 million in legal fees, which was paid by AGAE on September 11, 2024[82] - Knighted filed a second lawsuit, alleging AGAE directors breached fiduciary duties regarding a strategic investment with the Yellow River Capital group, and the court has stayed proceedings pending the outcome of AGAE's shareholders' meeting[82][83] - AGAE filed a lawsuit in the U.S. District Court for the Central District of California, alleging Knighted and its managing partners acted as an undisclosed 'group' in violation of Section 13(d) of the Securities Exchange Act of 1934[84] Other Information This section provides information on the publication of the interim results announcement and reiterates the continued suspension of trading in the company's shares, advising shareholders and potential investors to exercise caution Publication of Announcement This interim results announcement has been published on the websites of The Stock Exchange of Hong Kong Limited and the company, with the interim report to be published and dispatched to shareholders in due course - This interim results announcement has been published on the website of The Stock Exchange of Hong Kong Limited at www.hkexnews.hk and the company's website at www.lianzhong.com[85](index=85&type=chunk) Continued Suspension of Trading Trading in the company's shares has been suspended on the Stock Exchange since March 28, 2024, and will remain suspended until the company meets all resumption guidance and fully complies with the Listing Rules - Trading in the shares has been suspended on the Stock Exchange since 9:07 a.m. on Thursday, March 28, 2024[86] - Trading in the shares will remain suspended until the company meets all resumption guidance, remedies the issues that led to its suspension, and fully complies with the Listing Rules[86]