Financial Performance - Revenue for the first half of 2022 was RMB 4,087,214, a decrease of 5.9% compared to RMB 4,342,146 in the same period of 2021[8]. - Gross profit for the first half of 2022 was RMB 2,146,326, down 6.2% from RMB 2,288,065 in the previous year[8]. - Operating profit decreased by 80.4% to RMB 251,209 from RMB 1,284,000 year-on-year[8]. - Profit before tax fell by 75.1% to RMB 340,436 compared to RMB 1,365,378 in the same period last year[8]. - Net profit for the period was RMB 232,276, a decline of 78.5% from RMB 1,080,950 in the first half of 2021[8]. - Total revenue for the six months ended June 30, 2022, was RMB 4,087.2 million, a decrease of 5.9% compared to RMB 4,342.1 million for the same period in 2021[17]. - Gross profit for the same period was RMB 2,146.3 million, down from RMB 2,288.1 million, reflecting a decline in profitability[17]. - Operating profit for the six months was RMB 251.2 million, significantly lower than RMB 1,284.0 million in the previous year[17]. - The company reported a net profit attributable to equity holders of RMB 228.5 million for the six months ended June 30, 2022, compared to RMB 665.0 million in the previous year[26]. - Basic earnings per share for the six months ended June 30, 2022, was RMB 0.23, down from RMB 1.08 in the same period of 2021[34]. Revenue Breakdown - Online business revenue decreased by 9.2% to RMB 2,307.0 million, accounting for 56.4% of total revenue[20]. - Revenue from self-owned platform products in the online business fell by 6.3% to RMB 1,763.1 million, primarily due to cost optimization measures[20]. - Revenue from third-party platforms in the online business dropped by 35.8% to RMB 196.5 million, mainly due to the termination of partnerships with certain distributors[20]. - Total revenue for the online business segment was RMB 2,307.0 million, with a gross profit margin of 50.3%[27]. - Revenue from copyright operations and others was RMB 1,780.2 million, with a gross profit margin of 55.4%[27]. Cost Management - The company implemented cost control measures, reducing certain marketing expenses to optimize operational efficiency[11]. - Total revenue cost decreased by 5.5% year-over-year to RMB 1,940.9 million, driven by reduced amortization of intangible assets and lower content costs[23]. - Sales and marketing expenses decreased by 17.6% year-over-year to RMB 1,110.5 million, representing 27.2% of total revenue, down from 31.0%[25]. - General and administrative expenses decreased by 12.2% to RMB 557.5 million, accounting for 13.6% of revenue compared to 14.6% in the previous year[26]. User Engagement - The average monthly active users for the company's own platform and Tencent's self-operated channels increased by 13.8% year-over-year to 264.7 million, with Tencent's channel users growing by 22.7% to 144.9 million[22]. - The average monthly paying users decreased by 12.9% year-over-year to 8.1 million, primarily due to an increase in light users attracted by free reading content[22]. - Average revenue per paying user increased by 6.6% year-over-year to RMB 38.8, reflecting improvements in content operations and recommendation efficiency[22]. - The average daily active users for the free reading business increased by 7.7% year-over-year to 14 million[22]. Strategic Initiatives - The company plans to expand its IP development across various forms, including film, animation, and games, to meet diverse cultural demands[16]. - The company launched several new productions in the film and television sector, achieving high ratings and critical acclaim[11]. - The sci-fi genre became the fastest-growing category on the platform, with approximately 20,000 new sci-fi works being incubated[11]. - The company has launched new animated series, achieving significant viewership with 4 billion and 3 billion views for "Starry Change" and "Martial Universe," respectively[13]. Financial Position - The total assets decreased from RMB 23,297.3 million as of December 31, 2021, to RMB 22,775.3 million as of June 30, 2022[36]. - The total liabilities decreased from RMB 6,110.3 million as of December 31, 2021, to RMB 5,144.5 million as of June 30, 2022[36]. - The leverage ratio improved from 6.8% as of December 31, 2021, to 3.4% as of June 30, 2022[36]. - Cash and cash equivalents net amount increased to RMB 6,555.7 million from RMB 5,691.9 million year-on-year[29]. - The company reported a net cash inflow from operating activities of RMB 706,767 thousand, compared to RMB 430,027 thousand for the same period in 2021, representing a 64% increase[86]. Shareholder Information - The board of directors has decided not to recommend an interim dividend for the six months ended June 30, 2022, compared to zero in the previous year[45]. - As of June 30, 2022, the total number of issued shares was 1,023,033,672[49]. - Tencent Holdings Limited holds a controlling interest with 577,643,604 shares, representing 56.46% of the company's equity[52]. - The company has adopted a code of conduct for directors' securities transactions in accordance with the listing rules[42]. Employee Management - As of June 30, 2022, the company had approximately 1,900 full-time employees, primarily located in China, with the majority in Shanghai[39]. - The company has implemented competitive salaries, performance-linked bonuses, and other incentives as part of its employee retention strategy[39]. Compliance and Governance - The company has complied with all applicable provisions of the corporate governance code during the six-month period ending June 30, 2022[41]. - The audit committee, along with the board and auditors, reviewed the company's interim performance for the six months ended June 30, 2022, and found the risk management and internal control systems to be effective and adequate[43].
阅文集团(00772) - 2022 - 中期财报