G-bits(SH:603444)2023-03-30 16:00Audit and Governance - The company reported a standard unqualified audit opinion from KPMG Huazhen LLP for the 2022 annual report[5]. - The board of directors confirmed that there are no false records, misleading statements, or significant omissions in the annual report[4]. - The report indicates that the company is committed to transparency and accuracy in its financial disclosures[4]. - The report outlines the company's governance structure and its commitment to social responsibility[5]. - The company has not faced any issues with a majority of directors being unable to guarantee the authenticity of the annual report[10]. - The company is committed to ensuring the accuracy and completeness of its financial reports, as stated by its management team[25]. - The company is committed to maintaining internal controls to ensure the accuracy of financial statements and prevent material misstatements due to fraud or error[136]. - Management is responsible for assessing the company's ability to continue as a going concern and disclosing relevant matters[136]. Financial Performance - The company's operating revenue for 2022 was approximately ¥5.17 billion, an increase of 11.88% compared to ¥4.62 billion in 2021[54]. - The net profit attributable to shareholders for 2022 was approximately ¥1.46 billion, a slight decrease of 0.52% from ¥1.47 billion in 2021[54]. - The net profit attributable to shareholders after deducting non-recurring gains and losses was approximately ¥1.47 billion, representing a growth of 19.79% compared to ¥1.23 billion in 2021[54]. - The net cash flow from operating activities for 2022 was approximately ¥1.75 billion, a decrease of 27.54% from ¥2.42 billion in 2021[54]. - The total assets at the end of 2022 were approximately ¥6.49 billion, down 8.63% from ¥7.10 billion at the end of 2021[54]. - The basic earnings per share for 2022 was 20.33 CNY, a decrease of 0.49% compared to 20.43 CNY in 2021[67]. - The weighted average return on equity decreased by 3.48 percentage points to 32.49% compared to 35.97% in the previous year[67]. - The company reported a total investment loss of approximately ¥1.30 billion in 2022, compared to a gain of approximately ¥332.89 million in 2021[56]. - The company achieved operating revenue of ¥5,167,615,488.17, an increase of 11.88% year-on-year[88]. - Net profit attributable to shareholders decreased by 0.52% to ¥1,460,874,459.68, while the net profit excluding non-recurring gains and losses increased by 19.79% to ¥1,468,317,227.00[88]. Revenue and Game Performance - The revenue from the game "Wandao Mobile" slightly increased compared to the previous year, supported by diverse promotional activities[42]. - The game "Yinian Xiaoyao (Mainland Version)" also saw a slight revenue increase, maintaining a stable update rhythm and launching various brand collaborations[42]. - "Aobi Island: Dreamland" launched in July 2022, contributing incremental revenue for the year[42]. - "World Popping Story," launched in October 2021, experienced a significant revenue increase compared to the previous year due to its longer operational time[42]. - The revenue from "Guigu Eight Desolation (PC Version)" significantly decreased compared to the previous year, attributed to its buyout model[44]. - The company has maintained a focus on user engagement through various IP collaborations and advertising efforts to sustain product popularity[42]. - Game revenue reached RMB 5,124,643,089.18, with a year-on-year increase of 12.46%[179]. - Domestic revenue was RMB 4,894,641,645.73, growing by 9.54% year-on-year, with a gross margin of 89.90%[179]. - International revenue (including Hong Kong, Macau, and Taiwan) surged by 87.23% to RMB 258,723,468.74, with a gross margin of 72.40%[179]. Investments and Expenses - The company made new equity investments totaling approximately ¥240.83 million in 2022, a decrease of 57.09% compared to the previous year[56]. - The investment income from equity method investments was approximately ¥74.29 million in 2022, down from ¥96.98 million in 2021[56]. - Research and development expenses increased by 10.51% to ¥672,606,989.65, attributed to personnel growth and salary increases[92]. - The company reported a significant increase in promotional expenses for new game launches, impacting sales expenses which rose by 10.05% to ¥1,401,713,286.40[89]. - Operating costs decreased by 16.65% to ¥582,139,390.15 compared to the previous year[89]. Social Responsibility and Community Engagement - The company has donated a total of approximately RMB 202,600 to support rural specialty industries in various regions, including Fujian, Sichuan, Qinghai, Gansu, Hubei, and Guizhou[117]. - The company provided learning supplies and winter clothing worth approximately RMB 94,800 to 364 children at the Sun Village Children's Rescue Center in Jiangxi Province[116]. - The company donated growth packages to 183 girls in 7 rural schools in Sichuan Province as part of its "Spring Bud Program" to support their physical and mental health[114]. Market Strategy and Future Plans - The company plans to continue expanding its game portfolio and enhancing player engagement through data-driven strategies[55]. - The company plans to continue investing in overseas markets, focusing on self-developed products tailored for these regions[158]. - The company aims to recruit talented producers and distribution teams with deep cultural insights to accelerate overseas business development[158]. - The company plans to continue monitoring the accuracy of revenue calculations related to self-operated and joint-operated game income amortization[132]. Risk Management - The company emphasizes the importance of estimating the expected usage cycle of virtual game items and the expected lifespan of paying players for revenue recognition[132]. - Management highlighted the risk of revenue manipulation due to the reliance on IT systems for revenue recognition, particularly in self-operated and joint-operated games[132]. - G-bits is focused on evaluating the appropriateness of accounting policies and estimates made by management, particularly regarding the expected usage cycles of game items[140].