联众(06899) - 2025 - 中期业绩

Interim Results Overview The company reported a 13.8% decrease in revenue to RMB 43,236 thousand and a 93.0% increase in loss attributable to owners to RMB 38,161 thousand for the six months ended June 30, 2025 Financial Highlights for the Six Months Ended June 30, 2025 | Metric | Six Months Ended June 30, 2025 (thousand RMB) | Six Months Ended June 30, 2024 (thousand RMB) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 43,236 | 50,155 | (13.8 %) | | Loss for the Period Attributable to Owners of the Company | (38,161) | (19,770) | 93.0 % | | Basic Loss Per Share (RMB cents) | (3.56) | (1.84) | 93.5 % | | Diluted Loss Per Share (RMB cents) | (3.56) | (1.84) | 93.5 % | Business Review The Group advanced its global intellectual sports strategy, stabilizing PC operations, optimizing mobile games, integrating AI and cloud tech, and expanding through strategic partnerships and offline sports park development Core Business Development Lianzong International deepened its global intellectual sports and entertainment strategy in H1 2025, stabilizing PC-based "Lianzong Hall" operations and optimizing mobile games - Traditional PC business "Lianzong Hall" maintained stable development, enhancing user engagement and game fairness through community building, new category introduction, and AI/anti-cheat system upgrades[5] - Mobile card and casual games (e.g., Dou Dizhu, Mahjong, Fishing, Chess) performed well, improving user social experience and retention through optimized interfaces, gameplay, and enhanced in-game community features[5] Cutting-Edge Technology and Innovative Business The Group deeply integrated AI, upgraded to cloud architecture for stability, and introduced advanced AI models like Deep Seek and ChatGPT for efficiency, while its subsidiary Huayang developed successful intellectual sports event IPs - Fully implemented cloud architecture upgrade, significantly improving system response speed and stability in high-concurrency scenarios, enabling elastic resource scheduling and automated operations, and effectively reducing IT operating costs[6] - Successfully introduced cutting-edge AI large models like Deep Seek and ChatGPT, building a localized AI model system that significantly enhances efficiency in art development and operations, and explores AI empowerment for traditional strong projects like Chinese Chess and Four-Nation Chess[6] - Subsidiary Huayang, focusing on intellectual sports events and content production, saw its 'Mahjong Competition King' series, including 'Mahjong Super Cup' and 'Competitive Mahjong Masters,' consistently rank among top online video platforms in viewership, with 'Sichuan Mahjong Star League' setting a new industry record of over 110,000 concurrent online users[6][7] Diversified Strategy and International Expansion The Group expanded content distribution through a Youku partnership, launched the "Intellectual Masters Tournament" with the Danzhou government, developed Lianzong Sports Park, and introduced the "AGAE Overseas Esports League" to Youku - Signed a cooperation agreement with Youku to feature event content on its platform; partnered with the Danzhou Municipal Government in Hainan Province to host the 'Intellectual Masters Tournament' in the Xin'ying Bay area, leveraging a 'tournament + industry + culture & tourism' model to stimulate regional development[7] - Through its wholly-owned subsidiary Lianzong Sports (Beijing) Co., Ltd., the Group is advancing the construction and operation of Lianzong Sports Park, creating a comprehensive sports platform integrating venues, event hosting, youth training, and sports social activities to diversify revenue streams[8] - Introduced the 'AGAE Overseas Esports League' (including 'Mario Kart,' 'Valorant,' 'Fortnite') to the Youku platform, achieving precise alignment of global resources with local demand, balancing international vision with localized operations[8] Future Outlook Lianzong International will continue to leverage its core strengths in card and board games, accelerate innovative business development, and aim to be a unique leader in China's intellectual sports ecosystem - The Group will continue to deepen its core strengths in card and board games, accelerate innovative business development, and actively seize new industry trends[9] - Committed to becoming a unique 'intellectual sports ecosystem leader' in China's sports industry, contributing Chinese solutions to the innovative development of the global sports and entertainment industry[9] Management Discussion and Analysis The Group's loss significantly increased due to higher operating expenses and associate losses, while revenue declined, impacting gross margin and liquidity, though future expansion is planned primarily through internal resources Financial Review Loss attributable to owners increased to RMB 38.2 million in H1 2025 due to higher selling, R&D, resumption, and associate litigation expenses, with revenue down 13.8% to RMB 43.2 million and gross margin declining to 51.7% - Loss for the period attributable to owners of the Company increased by 93.0% from RMB 19.8 million in the same period of 2024 to RMB 38.2 million in the same period of 2025[3][10][20] - The increase in loss was primarily due to higher selling and new product R&D expenses, a significant increase in professional fees for resumption, and a substantial increase in litigation expenses for associate AGAE, leading to a higher share of net loss from associates[10] Changes in Revenue, Cost of Revenue, and Gross Margin | Metric | H1 2025 (thousand RMB) | H1 2024 (thousand RMB) | Change (%) | Change (thousand RMB) | | :--- | :--- | :--- | :--- | :--- | | Revenue | 43,236 | 50,155 | (13.8 %) | (7,000) | | Cost of Revenue | 20,878 | 23,158 | (9.8 %) | (2,280) | | Gross Margin | 51.7 % | 53.8 % | (2.1 pp) | - | - The decrease in revenue was mainly due to stable mobile game business, but a lower average revenue per user (ARPU) for Lianzong Game Hall, resulting in reduced overall Lianzong Game Hall revenue, and MCN business activity not yet fully reflected in revenue[11] - The decline in gross margin was primarily due to the decrease in revenue from Lianzong Game Hall, which has a higher gross margin[12] Expense and Expenditure Analysis Selling and marketing expenses surged 108.3% to RMB 12.5 million, administrative expenses rose 13.7% to RMB 17.4 million (due to resumption costs), R&D expenses increased 49.0% to RMB 5.5 million, and share of net loss from associates grew 62.1% to RMB 23.5 million (due to AGAE litigation) Changes in Key Expense Categories | Expense Category | H1 2025 (thousand RMB) | H1 2024 (thousand RMB) | Change (%) | Change (thousand RMB) | | :--- | :--- | :--- | :--- | :--- | | Selling and Marketing Expenses | 12,535 | 5,952 | 108.3 % | 6,583 | | Administrative Expenses | 17,392 | 15,349 | 13.7 % | 2,043 | | Research and Development Expenses | 5,543 | 3,719 | 49.0 % | 1,824 | | Share of Net Loss from Associates | 23,471 | 14,517 | 62.1 % | 8,954 | - The increase in administrative expenses was mainly due to higher resumption-related expenses incurred since July 2024[16] - The increase in R&D expenses was due to the Group's intensified efforts in updating existing versions and developing new versions of online games during the period[17] - The increase in share of net loss from associates was primarily due to higher litigation expenses incurred by the Company's associate, AGAE, during the period[18] Liquidity and Capital Resources Total bank balances and cash decreased 6.7% to RMB 12.7 million as of June 30, 2025; the current ratio fell from 1.68 to 1, and the debt-to-equity ratio rose from 0% to 21.2% Changes in Liquidity Ratios | Metric | June 30, 2025 (thousand RMB) | December 31, 2024 (thousand RMB) | Change (%) | | :--- | :--- | :--- | :--- | | Total Bank Balances and Cash | 12,727 | 13,640 | (6.7 %) | | Current Assets | 30,368 | 47,701 | (36.4 %) | | Current Liabilities | 30,395 | 28,333 | 7.3 % | | Current Ratio | 1 | 1.68 | (0.68 pp) | | Debt-to-Equity Ratio | 21.2 % | 0 % | 21.2 pp | - The Group currently intends to primarily fund future expansion, investments, and business operations through internal resources, but may explore other financing sources when appropriate[22] Investments and Assets The Group acquired Chinese property with a fair value of RMB 5.63 million as collateral for outstanding loans and interest, while financial assets at fair value through profit or loss remained at RMB 14.2 million, primarily in game/intellectual sports tech startups and private equity funds - The Group acquired Chinese property with a fair value of RMB 5,630,000 pledged for outstanding loans and accrued interest[23][66] Financial Assets at Fair Value Through Profit or Loss | Metric | June 30, 2025 (thousand RMB) | December 31, 2024 (thousand RMB) | | :--- | :--- | :--- | | Financial Assets at Fair Value Through Profit or Loss | 14,215 | 14,215 | - The Group invests in financial assets at fair value through profit or loss to complement its game portfolio, explore new business opportunities in ecosystem-related areas, generate strategic operational synergies, and leverage external financial resources for expertise and scale[25] - These investments primarily include direct equity investments in selected startups (mainly engaged in technology R&D related to games or intellectual sports) and direct subscriptions to private equity funds focused on providing early-stage financing to companies operating in the intellectual sports sector[26] Other Financial Information No significant acquisitions, disposals, asset pledges, or material contingent liabilities occurred; foreign exchange risk is not significant; and the Group had 76 employees with total staff costs decreasing 27.5% to RMB 9.5 million - For the six months ended June 30, 2025, the Group had no significant acquisitions or disposals, no asset pledges, and no material contingent liabilities[24][29][30][31] - The Group primarily operates in China, with most transactions settled in RMB, and as of June 30, 2025, its operations had no significant foreign exchange risk[32] Employee Remuneration and Policy | Metric | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Number of Employees | 76 | - | | Total Staff Costs (million RMB) | 9.5 | 13.1 | Corporate Governance and Other Information The company maintains strong corporate governance, addressing past deviations, and is involved in significant ongoing litigations, while the Board has decided against an interim dividend Corporate Governance The company maintains strict corporate governance, complying with the Listing Rules' Corporate Governance Code, having rectified the separation of Chairman and CEO roles, with all directors adhering to securities dealing standards, and an audit committee overseeing internal controls and financial reporting - The Company complied with applicable code provisions of the Corporate Governance Code, with a previous deviation from Code Provision C.2.1 (requiring separation of Chairman and CEO roles) now rectified after Ms. Xu Jin's appointment as Executive Director and CEO, and Mr. Lu Jingsheng's reassignment as CFO[37] - All Directors confirmed strict compliance with the Model Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix C3 to the Listing Rules for the six months ended June 30, 2025[39] - The Audit Committee comprises three independent non-executive directors (Mr. Zhang Li, Mr. Ma Shaohua, and Mr. Dai Bing), with Mr. Zhang Li as Chairman, primarily responsible for reviewing and overseeing the Company's internal controls and financial reporting procedures[40] Significant Litigation Matters The company is involved in two major litigations: an arbitration and lawsuit against Merit Horizon and Ms. Fu Qiang for loan default, with arbitration hearings concluded but no award yet, and a civil suit ongoing; and an arbitration against Spoville and its major shareholder, where a favorable award was obtained and enforcement is being pursued in South Korea - The Company initiated arbitration against Merit Horizon Limited and Ms. Fu Qiang for loan default, claiming no less than HKD 97,948,090.47, with significant hearings recently concluded but no award yet[43][44][45] - The Company filed civil lawsuits in the Hong Kong High Court against Bright Wisdom Holdings Limited, Ms. Fu Qiang, and Mr. Gao Hong, seeking repayment of loan principal and interest, and claiming against Ms. Fu and Mr. Gao for breach of their fiduciary duties as former directors of the Company, with proceedings ongoing and no judgment yet rendered[46][47] - The ICC International Court of Arbitration issued a final award against Spoville and its major shareholder Mr. Seung-Hwan Oh for breach of the Convertible Bond Subscription Agreement and Supplemental Agreement, ordering them to jointly pay the convertible bond principal and interest, legal fees, and arbitration costs[48] - A South Korean court issued a ruling agreeing to recognize and enforce the ICC arbitration award, and made an asset disclosure order based on the Company's application; further asset inquiries are underway, and the Company will apply for compulsory enforcement based on the results[48][49] Dividend Policy The Board does not recommend the payment of any interim dividend for the six months ended June 30, 2025 - The Board does not declare any interim dividend for the six months ended June 30, 2025 (six months ended June 30, 2024: nil)[50][64] Condensed Consolidated Financial Statements The financial statements for H1 2025 show a loss for the period of RMB 35,086 thousand, with net current liabilities of RMB 27 thousand and equity attributable to owners at RMB 35,454 thousand Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income For the six months ended June 30, 2025, the company reported revenue of RMB 43,236 thousand, gross profit of RMB 22,358 thousand, a loss for the period of RMB 35,086 thousand, and a loss attributable to owners of RMB 38,161 thousand, with basic and diluted loss per share at RMB 3.56 cents Key Data from Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income | Metric | H1 2025 (thousand RMB) | H1 2024 (thousand RMB) | | :--- | :--- | :--- | | Revenue | 43,236 | 50,155 | | Cost of Revenue | (20,878) | (23,158) | | Gross Profit | 22,358 | 26,997 | | Other Income | 2,111 | 2,842 | | Selling and Marketing Expenses | (12,535) | (5,952) | | Administrative Expenses | (17,392) | (15,349) | | Research and Development Expenses | (5,543) | (3,719) | | Share of Net Loss from Associates | (23,471) | (14,517) | | Loss Before Income Tax | (35,086) | (20,782) | | Loss for the Period | (35,086) | (20,782) | | Loss for the Period Attributable to Owners of the Company | (38,161) | (19,770) | | Basic Loss Per Share (RMB cents) | (3.56) | (1.84) | Condensed Consolidated Statement of Financial Position As of June 30, 2025, total non-current assets were RMB 36,101 thousand, current assets RMB 30,368 thousand, current liabilities RMB 30,395 thousand, resulting in net current liabilities of RMB 27 thousand, net assets of RMB 32,164 thousand, and equity attributable to owners of RMB 35,454 thousand Key Data from Condensed Consolidated Statement of Financial Position | Metric | June 30, 2025 (thousand RMB) | December 31, 2024 (thousand RMB) | | :--- | :--- | :--- | | Non-current Assets | 36,101 | 52,778 | | Current Assets | 30,368 | 47,701 | | Current Liabilities | 30,395 | 28,333 | | Net Current (Liabilities) / Assets | (27) | 19,368 | | Total Assets Less Current Liabilities | 36,074 | 72,146 | | Net Assets | 32,164 | 66,893 | | Equity Attributable to Owners of the Company | 35,454 | 73,258 | Notes to the Condensed Consolidated Financial Statements The notes detail the basis of preparation, accounting policies, revenue breakdown by product and region, other income and expense items, changes in associate interests, and specifics on receivables, payables, and ongoing litigations Basis of Preparation and Accounting Policies The condensed consolidated financial statements are prepared in accordance with IAS 34 "Interim Financial Reporting" and applicable Listing Rules, with no significant impact from new IFRS amendments - The condensed consolidated financial statements are prepared in accordance with International Accounting Standard 34 'Interim Financial Reporting' issued by the IASB and the applicable disclosure requirements of the Listing Rules of The Stock Exchange of Hong Kong Limited[55] - The application of amendments to International Financial Reporting Standards during this interim period had no significant impact on the Group's financial position and performance for the current and prior periods and/or the disclosures contained in these condensed consolidated financial statements[56] Revenue and Segment Information For the six months ended June 30, 2025, online game revenue was RMB 36,843 thousand and online advertising service revenue was RMB 6,393 thousand, all from China, with no single customer accounting for over 10% of total revenue Revenue from Contracts with Customers by Major Product or Service Line | Revenue Source | H1 2025 (thousand RMB) | H1 2024 (thousand RMB) | | :--- | :--- | :--- | | Online Game Revenue | 36,843 | 44,302 | | Online Advertising Service Revenue | 6,393 | 5,853 | | Total Revenue | 43,236 | 50,155 | - All of the Group's revenue from external customers was derived from mainland China[60] - For the six months ended June 30, 2025 and 2024, no revenue from any individual game player or customer accounted for 10% or more of the Group's total revenue[61] Details of Other Income and Expenses Total other income was RMB 2,111 thousand, mainly from intellectual sports venue services, with a significant decrease in bank interest income; net other losses were RMB 132 thousand due to foreign exchange losses; and total staff costs decreased to RMB 9,546 thousand Details of Other Income | Other Income Item | H1 2025 (thousand RMB) | H1 2024 (thousand RMB) | | :--- | :--- | :--- | | Royalty Income | 74 | 127 | | Loan Interest Income | 207 | 165 | | Bank Interest Income | 12 | 318 | | Government Grants | 6 | 6 | | Income from Providing Card and Board Game Venues | 1,789 | 2,212 | | Miscellaneous Income | 23 | 14 | | Total Other Income | 2,111 | 2,842 | Details of Other Income and Losses | Other Income and Loss Item | H1 2025 (thousand RMB) | H1 2024 (thousand RMB) | | :--- | :--- | :--- | | Net Foreign Exchange (Loss) / Gain | (132) | 110 | | Impairment Loss on Prepayments | — | (302) | | Total | (132) | (192) | Details of Staff Costs | Staff Cost Item | H1 2025 (thousand RMB) | H1 2024 (thousand RMB) | | :--- | :--- | :--- | | Salaries, Allowances and Other Benefits | 7,096 | 10,363 | | Retirement Benefits | 1,891 | 2,595 | | Severance Payments | 525 | 73 | | Equity-settled, Share-based Payments | 34 | 78 | | Total Staff Costs | 9,546 | 13,109 | Interests in Associates and Receivables/Payables Interest in associate AGAE decreased to RMB 7,035 thousand due to its losses; total trade and other receivables were RMB 17,157 thousand (including RMB 7,838 thousand net loans and interest); total trade and other payables were RMB 17,690 thousand (including RMB 4,192 thousand accrued legal fees); and bank loans increased to RMB 7,500 thousand - Interest in associate Allied Gaming & Entertainment Inc. (AGAE) decreased to RMB 7,035 thousand (December 31, 2024: RMB 29,723 thousand), primarily due to the share of AGAE's losses accounted for using the equity method[67] Details of Trade and Other Receivables | Receivable Category | June 30, 2025 (thousand RMB) | December 31, 2024 (thousand RMB) | | :--- | :--- | :--- | | Trade Receivables (net) | 827 | 1,597 | | Prepayments (net) | 1,149 | 6,171 | | Other Receivables and Deposits (net) | 7,343 | 6,542 | | Loans and Interest Receivable (net) | 7,838 | 19,271 | | Total Trade and Other Receivables | 17,157 | 33,581 | Details of Trade and Other Payables | Payable Category | June 30, 2025 (thousand RMB) | December 31, 2024 (thousand RMB) | | :--- | :--- | :--- | | Trade Payables | 3,682 | 4,313 | | Other Payables and Accrued Expenses | 5,345 | 5,047 | | Staff Costs and Accrued Benefits | 3,240 | 4,027 | | Accrued R&D Expenses | 410 | 3,256 | | Accrued Legal and Professional Fees | 4,192 | 3,038 | | Accrued Consulting Service Fees | 706 | 738 | | VAT and Other Taxes Payable | 115 | 1,347 | | Total Trade and Other Payables | 17,690 | 21,766 | Bank Loans | Bank Loans | June 30, 2025 (thousand RMB) | December 31, 2024 (thousand RMB) | | :--- | :--- | :--- | | Current Portion | 7,500 | 2,600 | Other Litigation/Arbitration Details Arbitration by Mr. Wu Guoliang against AGAE for USD 1 million is in discovery, with hearings set for November 2025; the second Knighted lawsuit against AGAE for breach of fiduciary duty is paused pending AGAE's AGM results; and AGAE has sued Knighted for violating Section 13(d) of the Securities Exchange Act - Arbitration by Mr. Wu Guoliang against AGAE for USD 1,000,000 in outstanding debt is in the discovery phase, with hearings scheduled for early November 2025[74][75] - Knighted Pastures, LLC's second lawsuit against AGAE, alleging breach of fiduciary duties by AGAE directors, has been stayed by the court pending the results of AGAE's 2024/2025 joint shareholders' meeting[79][80] - AGAE filed a lawsuit in the U.S. District Court for the Central District of California, alleging that Knighted and its managing partner Roy Choi, among others, acted as an undisclosed 'group' in violation of Section 13(d) of the Securities Exchange Act of 1934[81] Other Information The company's shares remain suspended from trading since March 28, 2024, pending fulfillment of resumption guidance, and the Board composition includes executive, non-executive, and independent non-executive directors Suspension of Trading in Shares Trading in the company's shares has been suspended on the Stock Exchange since 9:07 a.m. on March 28, 2024, and will remain suspended until all resumption guidance is met and Listing Rules are fully complied with - At the Company's request, trading in its shares on the Stock Exchange has been suspended since 9:07 a.m. on Thursday, March 28, 2024[83] - Trading in the shares will remain suspended until the Company fulfills all resumption guidance, rectifies the issues leading to its suspension, and fully complies with the Listing Rules to the satisfaction of the Stock Exchange[83] Board Composition As of the announcement date, the Board includes Executive Directors Mr. Lu Jingsheng and Ms. Xu Jin; Non-executive Directors Ms. Gao Liping and Ms. Yu Bing; and Independent Non-executive Directors Mr. Ma Shaohua, Mr. Zhang Li, and Mr. Dai Bing - As of the date of this announcement, the Board comprises Executive Directors Mr. Lu Jingsheng and Ms. Xu Jin; Non-executive Directors Ms. Gao Liping and Ms. Yu Bing; and Independent Non-executive Directors Mr. Ma Shaohua, Mr. Zhang Li, and Mr. Dai Bing[84]