FORGAME(HK:00484)2024-04-24 09:45Financial Performance - The Group recorded revenue of approximately RMB 60.2 million for the year ended December 31, 2023, representing a decrease of 47.3% compared to the previous year[19]. - The gross profit for the year was RMB 9.04 million, an increase from RMB 5.77 million in 2022[13]. - The Group reported a loss of approximately RMB 17.6 million for the year, an improvement from a loss of RMB 20.1 million in 2022[19]. - The Group's EBITDA for the year was RMB 9.67 million, a significant increase from RMB 0.8 million in 2022[13]. - As of December 31, 2023, the Company had distributable reserves of approximately RMB 590.2 million, down from RMB 643.1 million as of December 31, 2022[40]. - The Board does not recommend the payment of any final dividend for the year ended December 31, 2023[37]. Assets and Equity - Non-current assets decreased to RMB 201.3 million in 2023 from RMB 267.3 million in 2022[16]. - Total assets decreased to RMB 655.8 million in 2023 from RMB 724.0 million in 2022[16]. - Total equity decreased to RMB 590.3 million in 2023 from RMB 643.2 million in 2022[16]. Business Strategy and Outlook - Management is confident that operating revenues, particularly in the gaming business, will grow significantly in 2024 and beyond[19]. - The Group continues to invest in online gaming, mobile gaming, and electronic device trading businesses[19]. - The Group aims to significantly increase operating revenue, particularly from the gaming business, in 2024 and beyond[20]. - The Group plans to strengthen internal management, improve efficiency, and reduce costs while actively expanding its business[23]. - The Group will increase the proportion of its gaming business and incorporate new technologies such as AI to enhance product quality and technical standards[23]. - The Group is committed to optimizing its business structure and promoting business expansion in the gaming field for sustainable development[23]. Challenges and Risks - The Group continues to face challenges from geopolitical tensions, international trade frictions, and fluctuations in demand in the economic environment[22]. - The Company faces risks if the PRC government finds that the underlying agreements do not comply with PRC laws, which could lead to severe penalties or loss of operational interests[144]. - The effectiveness of the Contractual Arrangements in providing operational control may not be equivalent to direct ownership, posing additional risks[148]. - The Group's reliance on PRC Operational Entities for critical services poses a risk; any breach or termination of service agreements could materially affect the Group's financial condition and operations[161]. Corporate Governance - There were changes in the board of directors, with Mr. Cui Yuzhi appointed as CEO on December 8, 2023[62]. - The appointment of directors is effective for an initial term of three years, renewable for another three years[70]. - The company has received written confirmations of independence from all Independent Non-executive Directors[72]. - There were no provisions for pre-emptive rights under the Articles or Cayman Islands laws[60]. Shareholding Structure - Managecorp Limited held approximately 20.06% of the ordinary shares, totaling 29,437,335 shares[81]. - Foga Group was the beneficial owner of 21,673,338 ordinary shares, representing approximately 14.77%[81]. - Wang Dongfeng holds 21,673,338 ordinary shares, representing approximately 14.77% of the total shareholding[83]. - Foga Holdings owns 7,763,997 ordinary shares, accounting for about 5.29% of the total shareholding[83]. - KongZhong Corporation holds 10,202,168 ordinary shares, representing around 6.95% of the total shareholding[85]. - China Create Capital Limited owns 9,584,000 ordinary shares, accounting for approximately 6.53% of the total shareholding[87]. - Baseway Co Ltd has a beneficial ownership of 9,614,760 ordinary shares, which is about 6.55% of the total shareholding[87]. - GU Wei holds 3,073,000 ordinary shares, representing approximately 2.09% of the total shareholding[87]. - Foga Internet Development owns 7,785,700 ordinary shares, accounting for about 5.31% of the total shareholding[83]. Related Party Transactions - During the year ended December 31, 2023, no related party transactions constituted a connected transaction as per the Listing Rules[2]. - The Company made a full impairment loss of RMB 15,750,000 related to a loan agreement for the year ended December 31, 2020[3]. - The company agreed to a settlement amount of RMB 4 million to reduce losses from a loan recovery effort, which was paid by KongZhong Youyi on December 8, 2023[100]. - The settlement was negotiated based on the likelihood of loan recovery and estimated legal costs, with the directors considering the terms fair and reasonable[100]. Employment and Remuneration - As of December 31, 2023, the Group had 58 full-time employees, with remuneration policies based on individual performance and regularly reviewed[190]. - The Group's remuneration includes salaries, bonuses, and allowances, with competitive packages offered to Directors[190]. - The Restricted Share Unit (RSU) Scheme allows for the grant of up to 11,290,494 Shares, representing 9% of the number of Shares in issue on the Listing Date[200]. - The RSU Scheme was approved on September 1, 2013, and aims to reward participants for their contributions to the Group's success[200]. - The Group has adopted the RSU Scheme as a long-term incentive plan for Directors and employees[194].