The company's strategy was to transform the Internet entertainment business, complete gambling games in three years, and start a new era of game entrepreneurship
At the end of 2017, the acquisition of the game company Dorkemon was completed, and the entertainment industry was transformed into a traffic management business with refined big data marketing and mobile game R&D, distribution, and game platform operation.
In the 2017-2019 gambling period, Dorkemon exceeded the total amount, of which 323 million yuan was deducted from non-net profit in 2018. After three years of gambling, the company ushered in a new entrepreneurial journey in the 5G cloud gaming era.
The company experienced the shock and pain of the industry version number and small to medium distribution system, adjusted in 2019 and started again in 2020
In 2018, close to 83% of the company's revenue and 90% of net profit came from the game business; the 2019 performance forecast revealed estimated performance of 1-130 million yuan. Dorkemon's performance fell short of 2018 but fulfilled its performance promises. The launch of mainly games was delayed in 2019. As products are gradually launched, performance will continue to grow, or may be able to recover and surpass the 2018 performance situation. In the past two years, the state has strengthened version approval and implemented a boutique game strategy, and the company has been affected to a certain extent. Survive the cold winter, embrace traffic, and sort through resources before starting. The company has reviewed a total of 14 editions, about 15 externally customized products, and has nearly 20 models in reserve. It is poised to launch in 2020.
The strategy is shifting to self-developed categories and focusing on traffic management. The launch of Q2 products in 2020 is expected to continue to grow at a high rate. The Dorkemon plan is mainly self-developed games, supplemented by agent-customized games, and relies on traffic organization capabilities, distribution capabilities, and product enrichment to continue to promote business and performance growth. According to the company's disclosure, during the 2020 Spring Festival, Dorkemon, like the industry, is expected to experience a 40%-50% increase in turnover. Dorkemon attaches great importance to research and development, establishing a “dual core” model with Chengdu as the R&D headquarters and Guangzhou as the distribution headquarters. The contribution of self-developed games is gradually increasing, while also expanding cloud gaming technology based on the 5G era. In 2020, it is expected that a number of self-developed and exclusive products will be launched. Among them, the two blockbuster ARPG games “Sword Love” and “Ancient Sword Faixian” will be released in the first quarter. Among the products that are already in mature operation, products such as “Dawn of Civilization”, “Taikoo Sekai”, and “Demolition of the Three Kingdoms” will continue to receive new users and continue to contribute stable revenue.
We are optimistic about the company's game self-research capabilities and technology catalysis. For the first time, we gave a “recommended” rating. We are optimistic about the development of the game industry in the 5G era, the company's traffic management, and the development potential of self-research.
We expect net profit of the return mother in 2019-2021 to be 122 million yuan, 332 million yuan, and 499 million yuan, up -63.7%, 171.7%, and 50.3% year-on-year, corresponding to EPS of 0.15 yuan, 0.41 yuan, and 0.62 yuan, respectively.
We are optimistic that the company will shift to an integrated R&D and traffic management strategy, covering the “recommended” rating for the first time.
Risk warning: There are risks such as new game sales falling short of expectations, increased competition in traffic management, and lack of talent.