Linekong Interactive Group Co., Ltd.

Transcription

1 Linekong Interactive Group Co., Ltd. (Incorporated in the Cayman Islands with limited liability) Stock code: 8267.HK Interim Results Presentation

2 1H Review of 2015

3 Review of Development Operations Successfully commercialized One Hundred Thousand Bad Jokes, which ranked among the top 10 on 3 lists in the App Store in a week after its launch. Three Swords of Linekong (Excalibur, Sword of Heaven, Blade of God) have been put into steady operation for over 12 to 24 months. Actively reserved strategic premium intellectual property ( IP ) after acquiring The White Hair Witch, The Legend of Zhenhuan, The Legend of Miyue and One Hundred Thousand Bad Jokes: - Established joint venture with Strawbear Technology, a company controlled by Nicky Wu, to develop and promote the mobile game adapted from The Wars of Shushan. - Acquired another influential and renowned animation IP B.E.E from U17 after One Hundred Thousand Bad Jokes. As at 30 June, 2015, accumulative number of registered users exceeded 190 mn, average monthly active users ( MAU ) are approx mn and average daily active users ( DAU ) are approx mn. As at 30 June, 2015, the Group recorded the revenue of RMB300 mn and the adjusted profit of approx. RMB51.7 mn. Restructuring Restructured the company and grouped the scattered and small R&D units into two R&D teams to integrate the Group s R&D experience; appointed Mr. Mei Song and Mr. Zhao Jun as Senior Vice Presidents to primarily coordinate the work of the two R&D teams respectively. Expanded publishing team and formed new teams in Shanghai and Shenzhen to seek outstanding games for acquisition; Appointed Mr. Feng Haili as Senior Vice President who is primarily responsible for the Group s publishing business. Internationalization Established subsidiary in the US following the formation of Korea subsidiary last year. As of 30 June, 2015, Linekong has established overseas subsidiaries in Seoul, Hong Kong, San Francisco, covering 44 overseas markets including Southeast Asia, Europe, US, and Russia. Strategic Investment Layout Officially change the Company s name into Linekong Interactive Group Co., Ltd., which marks the business expansion from online gaming to interactive entertainment. In line with the strategy of developing entertaining content, establishing synergistic business platforms and building an ecological organizations, the Company has Tentatively invested in Beijing Chunqiu Yongle Culture & Communication Co., Ltd. ( Yongle ), SMI Holdings Group Ltd. ( SMI ), TaoShouYou and Fuze Entertainment Co., Ltd. ( Fuze Entertainment ), etc. Establish Linekong Media.

4 Business Operation - Gaming Products As at June 30, 2015, the Group has commercialized 19 games: 11 self-developed games and 8 licensed games, covering main types of midcore and hardcore games. Blade of God/ Licensed One Hundred Thousand Bad Jokes/ Licensed The Legend of Zhenhuan/ Self-developed Warrior Crash/ Self-developed I Am Playboy/ Licensed Rumble Jungle/ Licensed C C G T B G Three Kingdoms/ Self-developed Flying West/ Self-developed Westward Journey/ Self-developed Hero/ Licensed Creatures/ Licensed Heaven Sword & Dragon Sabre/ Licensed Journey to the West/ Self-developed Ashes of Time/ Self-developed Warrior King/ Self-developed Bubble Ninja/ Self-developed Sword of Heaven/ Self-developed Unparalleled Devil/ Licensed Daybreak/ Licensed Go! Generals!/ Licensed Eternal Wars / Licensed R P G Develop + Publish A C T Excalibur / Self-developed Swords of Heroes/ Self-developed TV version of Swords of Heroes/ Selfdeveloped In testing stage, but not been commercialized

5 Business Operation - One Hundred Thousand Bad Jokes Successfully commercialized and launched on all platforms on March 18, 2015, achieving remarkable results with DAU over 1 mn on the day of commercialization. The success of One Hundred Thousand Bad Jokes, which is the first animation-themed game for Linekong, highlights Linekong s deep understanding and control ability of products in new fields. First Week Top Grossing for iphone No.9 App Store One of top 10 on 3 lists Top Free for iphone Top Free for ipad First Month No.8 No.2 Mobile game of One Hundred Thousand Bad Jokes Followers on Wechat over 700 thousand Top Grossing for iphone No.6 DAU Over 1 mn on the day of commercialization

6 Business Operation - Advantage of Long-life-cycle Products Three Swords of Linekong (Excalibur, Sword of Heaven, Blade of God) have been put into steady operation for over 12 to 24months, highlighting the advantage of long-life-cycle product. Top 10 Most Popular Original Mobile Game (1) Commercialized in March 2013 and operated for over 24 months The Peak Monthly Gross Billings reached RMB33 mn As at June 30, 2015, it was published in more than 20 countries and regions Top 10 Most Anticipate d Original Mobile Game (2) Commercialized in December 2013 and operated for over 18 months. The Peak Monthly Gross Billings reached RMB31 mn. Best Collectible Card Mobile Game (3) Commercialized in March 2014 and operated over 15 months. The Peak Monthly Gross Billings reached RMB41 mn. *(1) 2013 ranking by Game Industry Annual Conference (GIAC). (2) 2014 ranking by Game Industry Annual Conference (GIAC). (3) Ranking by Global Mobile Game Conference 2013.

7 Business Operation Reserve of Classic IP Accumulated resourceful top-quality IP, involving classical literature, film and animation to ensure sustainable development of game products in the future. The White Hair Witch The Legend of Zhenhuan One Hundred Thousand Bad Jokes

8 Business Operation Build IP through Cooperation Interaction between films and games and those between comics and games have become new normal and megatrends in the industry. The Wars of Shushan Linekong + Mr. Wu The Legend of Miyue Linekong + The same production team of The Legend of Zhenhuan B.E.E LineKong + U17

9 Business Operation - 1H2015 Highlights As of 30 June, 2015 Financial Review Revenue: approx. 300 mn, decreased by 17.1% y-o-y. Adjusted net profit: approx. RMB51.7 mn, down by 44.0% y-o-y. The decrease in revenue and net profit was mainly due to the postponed launches of some games for pursuing higher quality. Total asset:rmb1.32 bn Cash and cash equivalents: RMB820 mn Key Operating Overview 190mn Registered Game Users 4.07mn Monthly Active User (MAU) Monthly Average Revenue per Paying Player ( ARPPU ) 727,000 Daily Active User (DAU)

10 Structure Adjustment - Two R&D Teams Grouped the scattered and small R&D units into two R&D teams to integrate the Group s R&D experience and dedicate to in-depth research on and development of marvelous games. Set up publishing centers in Beijing and Shanghai to source outstanding gaming products for publication. Two R&D Teams Two Publishing Centers Zhao Jun Senior Vice President Mei Song Senior Vice President Feng Haili Senior Vice President R&D Team I R&D Team II Beijing Publishing Center Shanghai Publishing Center Products based on Chinese culture Focus on Greater China and Asian Markets Diverse products Focused on International markets Sourcing outstanding products for publication

11 Internationalization As of 30 June, 2015, Linekong has established overseas subsidiaries in Seoul, Hong Kong, San Francisco, covering 44 overseas markets including Southeast Asia, Europe, US, and Russia Russian market Headquarter Canada Macao 44 Overseas markets Beijing HK Malaysia Singapore Indonesia Taiwan Seoul Shanghai Korean subsidiary Korean market HK subsidiary HK/ Taiwan market South-Asia market North American subsidiary North American/Europe market San Francisco Headquarter Covered overseas markets

12 Strategic Investment Layout Tentative investments in line with the strategy of developing entertaining content, establishing synergistic business platforms and building an ecological organizations, for all the elements of the business. Guizhou Zhiqu SMI Holdings Newbility Technology, Shanghai TaoShouYou online trading platform Movies and TV dramas Game development Fuze Entertainment Consumer Electronics Yongle, Beijing Yongle 228.com More strategic investment in the future...

13 Prospect in 2H2015

14 Strategies Linekong Interactive is becoming an entertainment content provider, covering games, movies, TV dramas, comics and other relevant fields. Synergistic & Ecological Business Platforms Internationalized Business Diverse Products Entertaining Content IP + Panentertainment

15 Entertaining Content Establish Linekong Media Movies and games interaction - create synergies between movies, TV dramas and games. Taking roots in IP entering content-based and fast-growing film market as a means to maximize the value of IP, and become the first-tier entertainment content provider Games Others I P Movies Comics TV dramas

16 Internationalized Business Establish Local R&D and Publishing Team Overseas Achieve synergies between local and overseas teams to build up internationalized platforms for R&D and publishing. International R & D platform International publishing platform Local designers and production team Local publishing talents

17 Investment/ Equity Participation/ Cooperation Synergistic & Ecological Business Platforms Build Ecosystem for All Elements of the Industry Attract more outstanding business partners through investment, equity participation and cooperation. Mainland China Games HK / Macau / Taiwan Southeast Asia Europe and the US Japan and Korea Investment/ Equity Participation/ Cooperation Linekong Ecosystem Movies & TV dramas Comics Intelligent hardware Others

18 Diverse Products: Products Pipeline in 2H2015 and 2016 R&D Team I (Focus on Greater China and Asian Markets) R&D Team II (Focused on International markets) Linekong US Publishing Centers 3D CCG 3D MMOARPG 2D CCG 3D ACT 2D CCG 2D CCG 2D CCG The Legend of Zhenhuan The White Haired Witch Warrior Crash Excalibur II Hero Crash(tentatively) Rumble Jungle Eternal Wars 3D MMOARPG The Wars of Shushan 3D MMOARPG Sword of Heaven II 3D MMOACT B.E.E 2D CCG+X Modern Bad Jokes (tentatively) Social Game Show(tentatively) 3D CCG I Am Playboy 3D MMOARPG The Legend of MiYue/ Licence 3D CCG The Legend of MiYue /Self-developed 3D CCG Big Words of Shushan The Pirate (tentatively named) 3D MMOARPG Daybreak (mobile Version)

19 Diverse Products: Self-developed + Licensed Products A rich product line in 2H2015 and large MMO products (4 self-developed, 2 licensed) B.E.E is a two-dimensional 3D action MMO No less than 4 midcore and hardcore card games Publish the continuation of Linekong s 2 classic mobile games Excalibur and Sword of Heaven Publish mobile version of Daybreak. Both PC and Web version of the game are successfully published by Linekong

20 Operating Overview

21 Operating Overview All Games MAUs ( 000) For the 6 months ended 30 Jun DAU ( 000) For the 6 months ended 30 Jun Mobile games 3, ,788.3 Webgames Client-based games Total 4, ,342.9 Mobile games Webgames Client-based games Total Average Monthly Paying Users ( AMPU ) For the 6 months ended 30 Jun ARPPU (RMB) For the 6 months ended 30 Jun Mobile games 285, ,501 Webgames 1,310 4,567 Client-based games 4,554 10,968 Total 291, ,036 Mobile games Webgames 1, Client-based games Total

22 Financial Review

23 Financial Highlights RMB ( 000) 1H2015 1H2014 Change Revenue 300, , % Gross Profit 120, , % Adjusted EBITDA 52, , % Adjusted Profit Attributable to Equity Holders of the Company 51,704 92, % 1H2015 1H2014 Percentage points Gross Profit Margin 40.1% 51.4% -11.3% Adjusted Net Profit Margin 17.2% 25.5% -8.3% Operating Margin 0.5% 11.4% -10.9%

24 Revenue Breakdown by Developed & Licensed Games RMB ( 000) 1H2015 1H2014 Developed Games 126, ,117 Licensed Games 174,125 99,701 1H2014 Total 300, ,818 As of June 30, 2015, the Group had commercialised 19 online games, including 11 self-developed games and 8 licensed games. With strong ability in self-developed games and publishing licensed games, the Group recorded a steady growth which was in line with the market. 1H2015

25 Revenue Breakdown by Key Games RMB ( 000) 1H2015 1H2014 One hundred thousand bad jokes ( 十萬個冷笑話 ) 112,046 N/A Sword of Heaven ( 蒼穹之劍 ) 49, ,911 Blade of God ( 神之刃 ) 47,917 77,042 Sword of Heroes ( 英雄之劍 ) 41,367 N/A Excalibur ( 王者战魂 ) 25,217 85,557 Three Kingdoms ( 三國演義 ) 6,033 17,176 Daybreak ( 黎明之光 ) 4,773 12,079 Others 13,841 20,053 Total 300, ,818

26 Revenue Breakdown by Regions RMB ( 000) 1H2015 1H2014 Mainland China 271, ,018 Overseas 29,700 29,800 1H2014 Total 300, ,818 Visible results in overseas markets brought by the globalized development strategy. Established subsidiaries in Hong Kong, Seoul and the US, covering the markets of Hong Kong, Macau, Taiwan, South Korea and US. Published Korean version of Sword of Heaven. 1H2015

27 1H 2015 Expenses Analysis Cost of Revenue RMB ( 000) 1H2015 1H2014 IFRS 180, ,330 Selling & Marketing Expenses RMB ( 000) 1H2015 1H2014 IFRS 117,103 50,983 Non-IFRS (adjusted) 176, ,900 Non-IFRS (adjusted) 113,900 48,800 Administrative Expenses R&D Expenses RMB ( 000) 1H2015 1H2014 RMB ( 000) 1H2015 1H2014 IFRS 37,099 48,109 IFRS 54,768 47,173 Non-IFRS (adjusted) 20,900 15,300 Non-IFRS (adjusted) 36,100 30,100

28 Financial Position RMB ( 000) 1H2015 As at December Total assets 1,322,363 1,260,240 Total liabilities 263, ,944 Net assets 1,058,511 1,007,296 Cash and cash equivalents 816,166 1,086,532 Trade receivables 77,119 62,829 Trade and other payables 146, ,466

29 Q & A

30 IR Contacts Linekong Interactive Group Co., Ltd. T: