Production and Content Strategy - By the end of June 2023, the Group produced and distributed a total of 20 high-quality drama series, with 18 being original series where the Group acted as the lead/sole investor and executive producer[5]. - The drama series include popular titles such as "A Love for Separation," "A Little Reunion," and "Under the Skin," focusing on contemporary topics like family life and female empowerment[5]. - The Group is committed to diversified growth strategies, exploring new avenues such as content marketing, micro drama series, overseas business, and IP derivative development[6]. - The mission of the Group is to operate across the full value chain of drama series, including investment, production, distribution, promotion, and licensing of derivatives[12]. - The Group aims to maximize the commercial value of its proprietary IP rights and build a diversified business structure to reinforce its industry leadership[6]. - The Group has established itself as a top brand in the industry due to its abundant original IP reserve and high-quality content products[5]. - The focus on producing high viewership drama series has allowed the Group to inspire extensive discussions and deliver positive value propositions[5]. - The Group's strategy includes producing made-to-order drama series and developing films, further expanding its business lines[12]. - The Group's leadership in the industry is reinforced by its commitment to exploring new growth avenues and maximizing the value of its IP[6]. - The Group's operations since its inception in 2014 have been dedicated to creating a full value chain in the drama series market[12]. Financial Performance - Revenue for the six months ended June 30, 2023, was approximately RMB 422.1 million, a decrease of 12.1% from RMB 480.2 million in the same period of 2022[20]. - Gross profit for the same period was approximately RMB 209.9 million, an increase of 11.0% from RMB 189.1 million in 2022[20]. - Net gain for the six months ended June 30, 2023, was approximately RMB 131.0 million, a significant increase of 301.0% from a net loss of approximately RMB 65.2 million in 2022[20]. - Adjusted net profit for the same period was approximately RMB 139.0 million, representing a 32.1% increase from RMB 105.2 million in 2022[20]. - Revenue from original drama series broadcasting was RMB 377 million, accounting for 89.4% of total revenue in the first half of 2023[22]. - The content marketing segment recorded a year-on-year revenue increase of nearly 150% and a gross profit increase of nearly 260% in the first half of 2023[26]. - The Group's revenue decreased by 12.1% from RMB 480.2 million in the first half of 2022 to RMB 422.1 million in the first half of 2023, primarily due to a decline in broadcasting rights revenue for original drama series[56]. - The Group achieved an adjusted net profit of RMB 139 million, representing a year-on-year increase of 32.1%[39][40]. - Revenue from broadcasting rights of original drama series decreased by 18.5% from RMB463.3 million in H1 2022 to RMB377.4 million in H1 2023, primarily due to only one original series being broadcast during the period[71]. - Total revenue decreased by 12.1% from RMB480.2 million in H1 2022 to RMB422.1 million in H1 2023, mainly attributed to the decline in broadcasting rights revenue[87]. Viewer Engagement and Popularity - The original drama series "Nothing But You" achieved a rating of 8.2 on Douban.com, ranking TOP1 among urban romance drama series since 2023[22]. - The number of viewers for the micro drama "Beneath the Headlines" reached 170 million, with the highest viewership per episode exceeding 280 million[28]. - The micro drama series "Twenty Nine" achieved over 800 million total viewership on Douyin, with an average viewership per episode exceeding 40 million, ranking first in the micro drama category for four consecutive weeks[61][62]. International Expansion - The Group established "Linmon International" as an overseas business platform, focusing on overseas distribution and production of original content, and actively expanded into Greater Mandarin, Thai, and Indonesian markets[49][64]. - The first overseas localized production, the Thai version of "Thirty" (三十而已), has commenced filming in Bangkok[51]. - The Thai version of "Nothing But Thirty" is currently under production, indicating ongoing efforts in overseas localized production[68]. - The Group aims to strengthen its full-chain marketing system and expand strategic brand resources in overseas markets[67]. Corporate Governance and Financial Management - The Company has adopted the principles and code provisions of the Corporate Governance Code to enhance corporate value and accountability[158]. - The Audit Committee has reviewed the unaudited interim condensed consolidated financial statements for the six months ended June 30, 2023[164]. - The Company confirmed that there is no information required to be disclosed pursuant to Rule 13.51B(1) of the Listing Rules[165]. - The Group maintained a stable financial position with net current assets of RMB2,577.7 million as of 30 June 2023, compared to RMB2,475.0 million as of 31 December 2022[151]. - The Group's gearing ratio decreased to 31.8% as of June 30, 2023, from 37.3% as of December 31, 2022, due to a 9.9% decrease in total liabilities and a 5.8% increase in total equity[114]. - The effective tax rate increased from a negative 58.0% for the six months ended June 30, 2022, to 21.6% for the six months ended June 30, 2023[105]. - The income tax expense increased from RMB23.9 million for the six months ended 30 June 2022 to RMB36.1 million for the same period in 2023, with the effective tax rate rising from negative 58.0% to 21.6%[123]. Shareholding and Investments - As of June 30, 2023, directors and chief executives hold a combined interest of 44.33% in the company through controlled corporations[187]. - Lemontree Harvest Investment Limited holds 71,136,000 shares, representing a 44.33% equity interest in the Company[198]. - Faye Free Flight Limited directly holds 33,014,520 shares, also contributing to the 44.33% equity interest in the Company[198]. - A&O Investment Limited holds 33,014,520 shares, maintaining the same 44.33% equity interest in the Company[198]. - Linmon Run Limited directly holds 22,617,000 shares, which is part of the overall shareholding structure[198]. - The total number of shares held by concert parties amounts to 159,782,040, indicating significant collective ownership[198]. - The Company has a structured shareholding arrangement with multiple parties acting in concert, enhancing control and influence[194]. Utilization of Proceeds - The company utilized HK$ 155.9 million for drama series production and promotion, accounting for 50% of the total proceeds[171]. - The total net proceeds amounted to HK$ 311.8 million, with HK$ 130.9 million remaining unutilized at the end of the reporting period[171]. - The company plans to invest HK$ 46.8 million in potential strategic investment and acquisition opportunities by the end of 2025[171]. - The company has allocated 15% of the proceeds, equivalent to HK$ 46.8 million, for initiatives into emerging business opportunities[171]. - The company has not utilized HK$ 31.1 million for working capital and general corporate purposes as of the reporting period[171]. - The company has deposited unutilized net proceeds into interest-bearing accounts with licensed banks in Hong Kong or the PRC[184].
柠萌影视(09857) - 2023 - 中期财报