CMGE(HK:00302)2022-09-06 08:55Financial Performance - Total revenue for the first half of 2022 was RMB 1,232.8 million, a decrease of 43.5% compared to RMB 2,180.1 million in the same period of 2021[8]. - The net loss attributable to shareholders for the first half of 2022 was RMB 21.9 million, compared to a profit of RMB 393.5 million in the first half of 2021[8]. - The company's revenue decreased by approximately 43.5% from RMB 2,180.1 million in the six months ended June 30, 2021, to RMB 1,232.8 million in the same period of 2022[30]. - Game publishing revenue fell by about 33.1% from RMB 1,525.3 million to RMB 1,019.9 million, primarily due to delays in obtaining licenses for new games[30]. - Game development revenue decreased by approximately 67.9% from RMB 567.0 million to RMB 182.1 million, attributed to a decline in monthly revenue from existing games and delays in new game launches[31]. - The gross profit dropped by about 40.3% from RMB 839.6 million to RMB 501.0 million, while the gross profit margin increased from 38.5% to 40.6%[34]. - The adjusted net loss attributable to owners of the parent was RMB 15.7 million, compared to a profit of RMB 401.8 million in the previous year[28]. - The company reported a net loss of RMB 25.4 million for the period, compared to a profit of RMB 378.3 million in the same period last year[30]. - The company reported a net amount of HKD 849.15 million for the issuance and development business as of December 31, 2022, compared to HKD 470.90 million for the same period in 2021, reflecting a significant increase[48]. User Metrics - Average monthly active users decreased to 12,780 thousand from 19,084 thousand in the previous year, a decline of 33.8%[10]. - Average monthly paying users fell to 941.4 thousand from 1,442 thousand, a decrease of 34.8%[10]. - The Average Revenue Per Paying User (ARPPU) was RMB 218.3, down from RMB 251.9, a decline of 13.3%[10]. - Total new registered users reached 38,367 thousand, down from 58,014 thousand, a decrease of 33.8%[10]. Research and Development - Research and development expenses totaled RMB 204.3 million, an increase of 65.1% year-on-year[9]. - The company increased its R&D investment to RMB 204.3 million in the first half of 2022, representing a year-on-year growth of 65.1%[12]. - The number of R&D personnel reached 632 in the first half of 2022[12]. - The company plans to enhance its R&D capabilities and expand its product offerings in the future[40]. Product Development and Launches - The company has launched 11 self-developed products and has 10 more in the pipeline[9]. - The company plans to launch multiple new games in the second half of 2022, including "召喚先鋒" and "代號：奇兵"[12]. - The mobile game "太古封魔錄" achieved a monthly revenue exceeding RMB 200 million shortly after its launch[13]. - The game "仙劍奇俠傳七" sold over 450,000 copies for PC and over 210,000 copies for cloud gaming by June 30, 2022[12]. - The game "大富翁10" surpassed 1.23 million copies sold globally by June 30, 2022[12]. - The game "Xianjian World," developed by the company's Mantianxing Studio, is the first domestic open-world game with elements of virtual reality, set to launch in the first half of 2023 after initial testing in late 2022[16]. Strategic Initiatives - The company is expanding its overseas publishing business, with several games launched in multiple regions[9]. - The company plans to focus on expanding its overseas publishing business to increase revenue share from international markets[34]. - The company is implementing a comprehensive overseas strategy, focusing on regions such as Hong Kong, Macau, Taiwan, Southeast Asia, Japan, South Korea, and Europe and America for game development and global distribution[22]. - The company is collaborating with various partners to expand its IP ecosystem, including digital collectibles and VR experiences[14]. Corporate Governance and Management - The company has complied with the applicable provisions of the corporate governance code, except for a deviation regarding the separation of the roles of chairman and CEO[49]. - The company's board consists of three executive directors and three independent non-executive directors, ensuring a high level of independence[49]. - The total remuneration for key management personnel was RMB 13,019,000 for the six months ended June 30, 2022, compared to RMB 10,518,000 in 2021[116]. Social Responsibility - The company has committed to social responsibility by establishing the "Zhong Shou You Dream Library" project, donating two libraries annually, with the tenth library completed in June 2022[19]. - In response to the COVID-19 pandemic, the company allocated RMB 1 million for purchasing anti-epidemic supplies in Hong Kong in March 2022[19]. - The company strictly adheres to regulations regarding underage gaming, with players under 12 prohibited from making in-game purchases, and those aged 12-16 limited to RMB 50 per transaction and RMB 200 monthly[19]. Financial Position - The group's total cash and cash equivalents decreased by approximately 45.5% from RMB 818.5 million on December 31, 2021, to RMB 446.2 million on June 30, 2022[42]. - The group's current ratio was 1.6 times as of June 30, 2022, compared to 1.9 times on December 31, 2021[42]. - The company's net assets as of June 30, 2022, were RMB 5,851,985 thousand, compared to RMB 5,793,862 thousand at the end of 2021[71]. - The group reported trade receivables aging analysis showing RMB 789,437,000 within 6 months, an increase from RMB 620,678,000 in the previous year[98]. Shareholder Information - The company did not declare any interim dividend for the six months ended June 30, 2022, consistent with the previous year[49]. - The total number of stock options granted is 50,000,000, with 2,080,000 exercised during the period[51]. - As of June 30, 2022, the company executives hold a total of 853,908,067 shares, representing 30.85% of the total shares issued[54]. - The company has a total of 39,455,000 stock options available for exercise after accounting for 12,625,000 options that have been exercised[51]. Market Strategy - The company plans to expand its market presence in Southeast Asia, targeting a 25% increase in user acquisition by the end of the fiscal year[131]. - The company is implementing a new marketing strategy focused on social media platforms, aiming for a 30% increase in brand awareness[131].