Core Viewpoint - Lisheng Sports (002858) reported a strong performance in the first half of 2025, with significant increases in revenue and net profit, indicating robust growth in its core business and successful expansion into new sports sectors [1] Financial Performance - The company achieved operating revenue of 272 million yuan, a year-on-year increase of 21.94% [1] - The net profit attributable to shareholders reached 15.32 million yuan, reflecting a year-on-year increase of 11.97% [1] - In Q2 2025, the net profit surged by 319% compared to the same period last year [1] Business Operations - Lisheng Sports organized a total of 55 events at international, national, and regional levels, an increase of 10 events compared to the previous year [1] - The company is actively expanding its IP operations into the golf sector, having successfully hosted 7 golf events by the end of June, attracting over 200 top domestic and international golfers [1] Strategic Initiatives - With the countdown to the Hainan Free Trade Port's closure, Lisheng Sports is accelerating the construction of the Hainan International Circuit project [1] - The company aims to lead the operation of the Hainan International Circuit project, striving for a win-win situation in both social and economic benefits [1]

Summary of Lisheng Sports Conference Call Company Overview - **Company**: Lisheng Sports - **Industry**: Sports Event Management and Operations Key Points and Arguments Financial Performance - Lisheng Sports achieved a record high total revenue of over 400 million yuan in 2024, despite facing long-term equity investment losses and goodwill impairment [2][8] - Core racing and event operations remained profitable, while emerging karting and digital sports businesses incurred losses [2][8] - The company expects improved performance in 2025 due to reduced risks and an employee stock ownership plan [2][8] Business Strategy and Expansion - The company is expanding its strategy from racing to a broader sports domain, having secured golf event authorization in 2025 and planning to extend into tennis, cycling, and marathons [2][4] - The golf business will encompass events, practice facilities, and equipment, with expected revenue contributions starting in 2025 and significant growth anticipated post-2026 [2][5] - The Haikou racetrack is projected to be completed by the end of 2026, contributing to revenue from 2026 to 2027, benefiting from Hainan's free trade zone operations and tourism consumption [2][6] Market Outlook - The company is optimistic about the golf market, predicting that a well-structured full industry chain could surpass the scale of its current racing business [2][7] - Long-term revenue target is set to exceed 1 billion yuan through a "5+4+2" model [2][7] Revenue Streams and Profitability - The commercial value of golf events includes sponsorship, registration fees, merchandise, and broadcasting rights, with significant profit potential once initial costs are covered [2][8] - The expected revenue for golf events is around 400 million yuan, with profits projected between 150 million to 200 million yuan [12] Future Developments - The company plans to explore other sports events like marathons and tennis in 2026, contingent on progress in 2025 [14] - Additional racetrack projects are planned outside Hainan, driven by the growing demand for performance cars in China [15] Challenges and Risks - The company faced challenges in the past year due to long-term equity investment losses and goodwill impairment, alongside losses in karting and digital sports due to high initial investments [8] - The focus for 2025 will be on ensuring profitability and avoiding large-scale loss-making investments, particularly in AI and digital sports [18] Market Comparison and Insights - Domestic golf event profitability is expected to improve through marketization, with potential comparisons to successful overseas models like the European Tour [9][10] - The company is analyzing the commercial viability of various sports events, considering market competition and audience characteristics [20] Important Milestones - Key milestones to watch in 2025 and 2026 include developments in the golf business, the construction of the Haikou racetrack, and the progress of the company's capital increase and buyback plans [21]