祖龙娱乐(09990) - 2023 - 中期财报

Revenue and Growth - The company recorded revenue of RMB 402.3 million for the reporting period, an increase of 22.0% compared to RMB 329.8 million for the same period in 2022, primarily due to the launch of "In the Name of the Shining" in various regions including mainland China, Europe, and Southeast Asia [20]. - Revenue for the first half of 2023 reached RMB 402.3 million, representing a 22.0% increase compared to RMB 329.8 million in the same period of 2022 [30]. - The revenue from comprehensive game publishing and operations reached RMB 301.2 million, an increase of 56.8% from RMB 192.1 million in the same period of 2022 [62]. - Revenue generated from the mainland China market was RMB 238.3 million, representing a significant increase of 128.5% compared to RMB 104.3 million in the same period of 2022 [44]. - Revenue from regions outside mainland China was RMB 164.0 million, a decrease of 27.3% from RMB 225.5 million in the same period of 2022 [44]. Game Development and Releases - The company has several upcoming game releases, including "Avatar: Return to Pandora" and "Three Kingdoms: Honghu Baye," expected to launch in 2023, targeting markets in Southeast Asia and Asia respectively [16]. - The game "Madtale: Idle RPG" launched on July 12, 2023, and quickly entered the top 10 free games on iOS in multiple countries, peaking at 7th in the US [19]. - The MMORPG and shooting game "Avatar: Return to Pandora" has completed multiple testing phases and is expected to enhance user experience through continuous quality improvements [38]. - The company plans to launch 9 new games across various genres from the second half of 2023 to 2025 [35]. - The company is actively testing several new projects, including original IP games and licensed IP games, with anticipated launches in 2024 and 2025 [16]. Financial Performance - Gross profit increased to RMB 297.7 million, up 22.6% from RMB 242.8 million year-on-year [30]. - Operating loss narrowed to RMB 241.9 million, a 20.5% improvement from RMB 304.1 million in the same period last year [30]. - The company reported a net loss of RMB 233.0 million, a reduction of 24.6% from RMB 308.9 million in the same period of 2022 [30]. - Financial income surged by 220.5% to RMB 23.4 million, compared to RMB 7.3 million in the previous year [30]. - Adjusted net loss decreased to RMB 214.9 million from RMB 279.8 million in the same period of 2022, primarily due to increased revenue from the game "In the Name of the Shining" and controlled R&D costs [50]. Research and Development - Research and development expenses decreased by 18.5% to RMB 299.2 million from RMB 367.1 million in the previous year [30]. - The company is implementing an integrated research and operation model to extend the lifecycle of its games, which is expected to enhance revenue stability [20]. - The company is committed to continuous improvement and innovation in its game development strategy to capture a broader market share [12]. Employee and Talent Management - The company continues to enhance its talent structure across the country, focusing on cost reduction and efficiency while attracting high-value industry talent [12]. - Employee compensation and benefits costs for the six months ended June 30, 2023, were approximately RMB 303.2 million, down from RMB 370.9 million for the same period in 2022, representing a decrease of about 18.2% [125]. - The company employed approximately 1,094 full-time employees as of June 30, 2023, with around 78.15% being R&D personnel [125]. Cash Flow and Investments - Cash used in investing activities increased to RMB 336.5 million from RMB 96.2 million in the same period of 2022, primarily due to the purchase of time deposits [53]. - Cash used in operating activities for the six months ended June 30, 2023, was RMB 160.6 million, a decrease of 33.5% compared to RMB 241.6 million in the same period of 2022 [74]. - The company had a net cash outflow of RMB 519,520 thousand for the period, compared to RMB 426,205 thousand in the previous year, indicating a 21.8% increase in cash outflow [200]. Corporate Governance and Compliance - The company has complied with all applicable corporate governance code provisions, except for the separation of the roles of chairman and CEO [178]. - The audit committee has reviewed the unaudited interim financial statements for the six months ended June 30, 2023, with no objections to the accounting treatment [183]. - The board will continue to review the effectiveness of the corporate governance structure to assess the need for separating the roles of chairman and CEO [179]. Shareholder Information - Tencent holds a 17.23% stake in the company, representing 137,698,399 shares [136]. - The company reported a loss attributable to owners of the company of RMB 233,023 thousand for the six months ended June 30, 2023, an improvement from a loss of RMB 308,857 thousand in the same period of 2022 [100]. - The basic loss per share for the six months ended June 30, 2023, was RMB (0.30), compared to RMB (0.39) for the same period in 2022, reflecting a reduction in losses per share [100].