Financial Performance - Total revenue for the six months ended June 30, 2023, was RMB 391,031,000, a decrease of 23.4% compared to RMB 510,468,000 in the same period of 2022[6]. - Gross profit for the same period was RMB 237,593,000, down 44.0% from RMB 424,033,000, resulting in a gross margin of 60.8%, down from 83.1%[6]. - The company reported a loss attributable to equity shareholders of RMB 170,298,000 for the period, compared to a profit of RMB 43,046,000 in the same period last year[6]. - The adjusted net loss for the first half of 2023 was RMB 86.5 million, reflecting ongoing investments in product development and customer marketing[11]. - The company reported a net loss of RMB 171.66 million for the six months ended June 30, 2023, compared to a profit of RMB 35.20 million in the same period of 2022[22]. - The company’s operating loss for the period was RMB 144,367 thousand, compared to an operating profit of RMB 90,814 thousand in the same period last year[83]. - The basic and diluted loss per share for the six months ended June 30, 2023, was RMB (0.08), compared to earnings of RMB 0.02 per share in the prior year[83]. Customer Metrics - The number of core enterprise customers increased by 14% to 458 from 401 in the previous year, while the number of financial institution customers decreased by 14% to 126[7]. - Customer retention rate decreased to 86% from 96%, reflecting a decline of 10 percentage points[7]. - The total number of partners increased to 1,240, up 12% from 1,110 in the previous year[7]. - The total number of customers for the supply chain financial technology solutions increased by 7% year-on-year to 584, with core enterprise customers growing by 57 to a total of 458[12]. Market and Product Development - The company aims to expand its market presence and enhance its technology solutions in response to the current market challenges[6]. - The company is focusing on developing new products and technologies to improve its service offerings and regain market share[6]. - The company is focusing on integrating advanced technologies such as AI, blockchain, and big data to enhance supply chain financial services and improve operational efficiency[13]. - The company continues to expand and optimize its solutions to serve a broader range of scenarios and target customer groups within the supply chain ecosystem[97]. - The company aims to enhance its supply chain financial capabilities through innovative solutions tailored for financial institutions[99]. Revenue Breakdown - Revenue from core enterprise cloud decreased by 20.7% to RMB 231.1 million, primarily due to a sluggish supply chain asset securitization market[25]. - Revenue from financial institution cloud decreased by 30.1% to RMB 132.5 million, attributed to a decline in supply chain assets processed[25]. - Revenue from cross-border cloud increased by 27.7% to RMB 21.5 million, driven by expansion into various cross-border financing scenarios[26]. - Revenue from the Supply Chain Financial Technology Solutions segment was RMB 363,625,000, down 24.5% from RMB 481,107,000 in the previous year[95]. - The Emerging Solutions segment generated revenue of RMB 27,406,000, a slight decrease of 6.5% from RMB 29,361,000 in the prior year[95]. Expenses and Costs - Research and development expenses increased by 18.0% to RMB 189.0 million, reflecting continued investment in product and technology development[29]. - Sales and marketing expenses decreased by 19.1% to RMB 58.4 million, due to efforts to improve operational efficiency[30]. - General and administrative expenses decreased by 7.0% to RMB 104.5 million, mainly due to a reduction in unallocated share-based compensation[31]. - Total operating costs increased by 77.5% from RMB 86.4 million to RMB 153.4 million, despite a decrease in revenue[27]. Cash Flow and Financial Position - The net cash used in operating activities for the six months ended June 30, 2023, was RMB (444,042) thousand, compared to RMB 93,603 thousand for the same period in 2022, indicating a significant decline in cash flow[91]. - The net cash generated from financing activities was RMB 584,508 thousand, an increase from RMB 443,625 thousand in the previous year, showing improved financing capability[91]. - The total cash and cash equivalents at the end of the period increased to RMB 5,832,904 thousand from RMB 5,285,402 thousand, marking an increase of approximately 10.4%[91]. - As of June 30, 2023, the group's cash and cash equivalents increased to RMB 5,832.9 million from RMB 5,731.4 million as of December 31, 2022[47]. Governance and Compliance - The company has adhered to all provisions of the corporate governance code during the reporting period, except for the deviation regarding the roles of the Chairman and CEO being held by the same individual, Mr. Song[57]. - The Audit Committee, composed of three independent non-executive directors, reviewed the unaudited interim results for the six months ended June 30, 2023, and discussed accounting policies and internal controls with senior management and auditors[60]. - The Corporate Governance Committee reviewed the company's compliance with governance policies and regulations, including the diversity policy and shareholder communication policy[62]. Shareholder Information - As of June 30, 2023, Mr. Song holds 267,626,789 Class A shares and 19,799,907 Class B shares, representing approximately 57.44% of the voting rights for shareholder resolutions excluding reserved matters[63]. - Major shareholder Cabnetvic owns 221,212,025 Class A shares, accounting for 82.66% of the Class A shares[69]. - Tencent Holdings Limited holds 342,121,980 Class B shares, representing 16.96% of the Class B shares[69]. - The company has a total of 10.04% ownership in Class B shares attributed to Mr. Lin and his spouse[69]. Future Outlook - The company is actively expanding its international business, particularly in cross-border financing scenarios to support Chinese manufacturing enterprises[13]. - The company plans to reassess the separation of the roles of Chairman and CEO in the future, considering the overall situation of the group[57]. - The company aims to ensure sustainable operations and continue delivering returns to shareholders and benefits to other stakeholders through effective capital management[170].
联易融科技(09959) - 2023 - 中期财报