Events:
The company announced the semi-annual report of 2022, realizing operating income of 820 million yuan, net profit of 300 million yuan for YOY+275.3%, and non-net profit of 290 million yuan for YOY+4370.4%, YOY+1613.2%.
Main points of investment:
The good performance of card games led to a significant increase in revenue and profits in the first half of 2022. The company's income in the first half of 2022 was 820 million yuan, of which YOY+275.3%, revenue was 760 million yuan for mobile games and 59.852 million yuan for YOY+413.0%, client games. The growth of YOY-9.6%, was mainly due to the good performance of card games and the increase in game revenue. Overseas income was 16.698 million yuan, and YOY-53.9%, accounted for 2.0% of the total revenue (16.6% in the first half of 2021). On the cost side, the operating cost in the first half of 2022 was 38.562 million yuan. The increase in YOY+75.6%, was mainly due to the increase in labor costs and cloud service fees. The overall gross profit margin increased by 95.3% compared with the same period last year. The gross profit margin of mobile games increased by 95.6% compared with the same period last year, while the gross profit margin of client games decreased by 92.0% year-on-year 1.0pct. On the expense side, the sales expenses in the first half of 2022 were 270 million yuan. The increase in YOY+146.1%, was mainly due to the increase in advertising fees for card games, and the sales expense rate decreased by 32.4% compared with the same period last year. 17.0pct The R & D expenditure is 180 million yuan, and the increase in YOY+126.7%, is mainly due to the increase in R & D personnel. In the first half of 2022, the salary of employees in R & D expenses is 160 million yuan, and the rate of YOY+115.3%, R & D expenditure is 21.4% lower than the same period last year. 14.0pct. On the profit side, the company's net profit in the first half of 2022 was 300 million yuan, YOY+4370.4%, deducted non-net profit 280 million yuan, YOY+1613.2%, deducted non-net interest rate 34.9% year-on-year return to profit, improved 43.5pct, non-recurrent profit and loss 13.91 million yuan. In terms of balance sheet, by the end of the first half of 2022, the monetary funds on the account were 480 million yuan (490 million yuan at the end of 2021); accounts receivable were 75.887 million yuan (69.234 million yuan at the end of 2021); and contract liabilities were 70.794 million yuan (50.837 million yuan at the end of 2021).
Ploughing the online game market, continue to improve product quality.
In operation products: the company's products mainly include client-side online games and mobile games.
By the end of the first half of 2022, the company is operating 10 game products and one new game product in the first half of 2022, including 2D/2.5DMMORPG PC games, MMO national war mobile games, 3D national war mobile games, martial arts RPG mobile games, card placement RPG mobile games and so on. The company has a number of client and mobile games including "Expedition", "Longwu" and so on: ① "Expedition" IP: self-developed client game "Expedition OL" was commercialized in April 2010, and has accumulated a large number of user groups through more than a decade of operation, with a certain IP value. By the end of the first half of 2022, the number of game registered accounts exceeded 34.15 million, and the game income in the first half of 2022 was 32.003 million yuan. Accounts for 3.9% of the company's game business revenue. The company continued the "Expedition Mobile Games" and "Expedition 2 Mobile Games" launched by "Expedition" IP. The revenue of "Expedition 2 Mobile Games" in the first half of 2022 was 53.669 million yuan, accounting for 6.5% of the company's game business revenue. ② "Longwu" IP: the self-developed 2.5D MMORPG client game "Longwu" was tested in June 2014. by the end of the first half of 2022, the number of game registered accounts exceeded 19.16 million.
The youth swordsman mobile game Longwu Mobile Tour was tested in July 2019. By the end of the first half of 2022, the number of registered accounts of the game has exceeded 3.86 million. X-HERO, an overseas card placement mobile game issued by ③, topped the list of free iOS games in 25 countries and regions, including the United States, on August 31. The income of "Holy Soul dispute", a mobile game with cards issued by ④ in the first half of 2022, was 640 million yuan, accounting for 77.7% of the company's game business income, and the game promotion and operating expenses were 130 million yuan, accounting for 19.7% of the game revenue.
Reserve products: the company has set up a number of project teams to engage in new game development, reserve products cover MMORPG, card, SLG and other types, involving magic, fairy, martial arts and other topics. The self-developed and customized products that have been established include RPG+ card game "Legend of Heaven" (has won the version number, the third Android deletion payment test ends on June 29, and has authorized the exclusive agent of Panax Notoginseng Mutual Entertainment Chinese mainland), and MMOARPG mobile game "Big World" (alias "code: bimonthly") TapTap score 9.3), H5 MMOARPG mobile game "code H", strategic war SLG mobile game "code G", placing card mobile game "code Q", leisure competitive mobile game "code F", placing card mobile game "code sky".
The core team members of the company have rich experience in the development and operation of online games, continue to improve the talent system through "internal training + external introduction", and at the same time devote themselves to improving the ability of technological research and development for a long time, and the core competitive advantage of the enterprise is constantly enhanced. be optimistic about the company's long-term development space in the online game industry.
Risk hints: tighter policy regulation, intensified market competition, lower-than-expected progress in obtaining version numbers, lower-than-expected launch progress and performance of new products, rising flow costs, lower-than-expected life cycle of old products, lower-than-expected progress of new business, core brain drain, player preference change, corporate governance / asset impairment / deregulation, market style switching, industry valuation center downward, and so on.