COL(SZ:300364)2021-08-16 16:00Financial Performance - The company's operating revenue for the reporting period was ¥529,134,165.72, representing a 27.51% increase compared to the same period last year[14]. - The net profit attributable to shareholders was ¥27,684,648.79, an increase of 8.68% year-over-year[14]. - The net profit attributable to shareholders after deducting non-recurring gains and losses was -¥6,983,525.45, showing a 76.65% improvement from -¥29,903,818.14 in the previous year[14]. - The net cash flow from operating activities was -¥30,503,112.95, a decline of 129.70% compared to the previous year[14]. - The total assets at the end of the reporting period were ¥2,012,588,446.03, reflecting a 1.64% increase from the end of the previous year[14]. - The net assets attributable to shareholders at the end of the reporting period were ¥1,486,590,517.43, up 2.27% from the previous year[14]. - The company's overseas business achieved revenue of 333.61 million yuan, representing a year-on-year growth of 48.21%[31]. - The company's financial expenses rose by 127.14% to ¥3,058,888.29, mainly due to reduced foreign exchange gains and lower interest income from bank deposits[48]. - The company reported a significant increase in income tax expenses, which rose by 1,250.70% to ¥17,633,824.64, due to expanded profitability of overseas operations[48]. - The company reported a net profit of 39.89 million yuan from its subsidiary Overseas Company, with total assets of approximately 265.63 million yuan[75]. Subsidiaries and Business Operations - The company operates several wholly-owned subsidiaries, including Beijing Chinese Online Cultural Media Co., Ltd. and Tianjin Chinese Online Cultural Development Co., Ltd.[5]. - The company has a diverse portfolio of subsidiaries involved in various sectors, including education technology and cultural media[5]. - The company has accumulated over 5 million digital content resources and signed over 2,000 well-known authors[19]. - The company operates multiple original online platforms, including 17K Novel Network and April Sky Novel Network, to enhance content production[20][21]. - The company aims to cultivate authors' creative abilities through its online literature training courses, having trained over 6,000 students[23]. - The company continues to focus on its core digital publishing business while exploring new business forms[18]. - The audio subsidiary, Hongda Yitai, recorded over 30 billion cumulative plays for the classic work "Xiu Luo Wu Shen" on audio platforms[26]. - The company has established deep cooperation with major paid and free platforms, enhancing digital content distribution and exposure[24]. - The company has nearly 10,000 legal actions related to intellectual property rights, involving over 100,000 works, establishing itself as a significant channel for rights protection[25]. Intellectual Property and Legal Matters - The company emphasizes its commitment to intellectual property rights and anti-piracy initiatives through its subsidiaries[6]. - The company is actively exploring technological innovations in intellectual property protection, maintaining an industry-leading position[25]. - The company has developed a full-process system for intellectual property rights protection, including copyright confirmation and content monitoring[25]. - The company is addressing risks associated with copyright litigation and piracy, which remain significant challenges in the digital publishing industry[80]. - The company is involved in multiple lawsuits with a total disputed amount of approximately ¥3,204.25 million and ¥3,829.11 million in two separate cases, with both cases currently in the execution phase following the first-instance judgment[93]. - The company has ongoing litigation regarding copyright disputes, with one case involving a claim of ¥15.60 million in damages, which is also in the execution phase following the second-instance judgment[93]. - The company is currently facing various legal challenges, with several cases in different stages of litigation, indicating ongoing legal risks[93][94]. Financial Management and Investments - The company has a diversified investment strategy, utilizing both self-owned and raised funds for financial products, enhancing its financial stability[68]. - The company reported a profit of 59.52 million RMB from derivative investments during the reporting period, with a fair value change based on forward exchange rates provided by a bank[72]. - The company has established internal control systems for foreign exchange derivative trading to mitigate risks associated with currency fluctuations[72]. - The company has implemented measures to strengthen risk management in derivative investments, including training and operational guidelines[72]. - The company has engaged in entrusted financial management with a total amount of 75,316.00 million RMB, of which the outstanding balance is 43,451.00 million RMB[68]. - The company plans to continue its entrusted financial management strategy, indicating a commitment to maintaining liquidity and investment returns[69]. Shareholder and Corporate Governance - The company held the 2020 Annual General Meeting on May 13, 2021, with a participation rate of 14.44%[82]. - The first extraordinary general meeting of 2021 was held on February 10, 2021, with a participation rate of 34.22%[82]. - The second extraordinary general meeting of 2021 was held on June 16, 2021, with a participation rate of 25.52%[82]. - The company plans not to distribute cash dividends or issue bonus shares for the half-year period[84]. - The company has implemented a stock option incentive plan approved on March 23, 2020, with no changes in the list of incentive targets during the reporting period[85][86]. - The total number of ordinary shareholders is 37,753, with no shareholders holding special voting rights[112]. - The controlling shareholder, Tong Zhilei, holds 13.71% of the shares, totaling 99,712,416 shares[112]. Market Trends and Industry Insights - As of December 2020, China's digital reading industry reached a scale of 35.16 billion RMB, with a growth rate of 21.8%[36]. - The number of digital reading users in China reached 494 million in 2020, growing at a rate of 5.56%[36]. - The online entertainment market in China is projected to reach 670.48 billion RMB in 2020, with a year-on-year growth of 20.4%[38]. - The market size of the audiobook industry in China was estimated at 8.21 billion RMB in 2020, with a compound annual growth rate of 36.4%[39]. - The active user base for animation and comics reached 49.67 million in June 2021, reflecting an 11.6% increase from the previous year[41]. - The company is actively expanding its content distribution channels while facing increased competition in the digital reading market[79]. Accounting and Financial Reporting - The financial report is guaranteed to be true, accurate, and complete by the company's management, including the CEO and accounting head[2]. - The semi-annual financial report was not audited, which may affect the reliability of the financial data presented[121]. - The financial statements are prepared based on the actual transactions and events, in accordance with the accounting standards issued by the Ministry of Finance[164]. - The company has not reported any changes in accounting policies or prior period error corrections during this reporting period[151]. - The company recognizes expected credit losses for bank acceptance bills based on historical credit loss experience and current economic conditions[193]. Risks and Challenges - The company faces risks related to rising copyright acquisition prices, which could impact profitability if not managed effectively[78]. - The company has ongoing litigation involving 178 works, with a claimed compensation of 40.02 million RMB[97]. - The company has reported a total of 10.46 million RMB in expected liabilities from ongoing litigation[97]. - The company is currently engaged in a software copyright contract dispute with a claim amount of ¥6,541.50 million, which is still in the first-instance proceedings[93].