China Literature releases 2022 semi-annual report: revenue reaches 4.09 billion

On August 15, China Literature Group (0772.HK) announced its 2022 interim results report. The performance report shows that in the first half of 2022, China Literature Group achieved a total revenue of 4.09 billion yuan; of which, the online business was 2.31 billion yuan, and the copyright operation and other income was 1.78 billion yuan. In terms of profit, the non-IFRS net profit attributable to the parent company was about 670 million yuan, operating profit increased by 8.2% year-on-year to 690 million yuan, and the operating profit margin increased from 14.8% in the same period last year to 17.0%.

During the reporting period, in the face of the ever-changing industry environment, China Literature conducted more forward-looking thinking and responded flexibly. In the first half of the year, China Literature focused more on key businesses and long-term goals, and took a series of measures to control costs and improve efficiency, which significantly improved the company’s operational efficiency. At the same time, China Literature continues to consolidate its advantages in core business, continue to promote the incubation and operation of IP, especially in the visual adaptation of IP, continues to produce explosive models, laying a good foundation for the long-term development of the IP ecological chain.

Cheng Wu, CEO of China Literature, said: “In the first half of the year, we launched a series of well-known first-line works, including the TV series “The World”, “Heart Home”, “Feng Qi Longxi”, “Please Call Me Director”, the movie “This Killer Is Not Too Calm”, as well as many animation works. The continuous output of high-quality content, especially popular models, confirms the systematic ability of Reading in the visualization of the industry chain, and also strongly supports the long-term strategy of IP visual upgrading. At the same time , as an important part of improving the content ecology, this year we have stepped up efforts to promote anti-piracy, and have gained great trust and recognition from writers. We will continue to adhere to the long-term strategy, focusing on the incubation, development and operation of good stories, so that Good stories keep coming.”

Focus on healthy and sustainable development, continuously incubate high-quality products and consolidate the IP content ecology

During the reporting period, China Literature continued to focus on the nature of its business, and continued to consolidate the IP ecosystem of online literature by focusing on core paid content. The platform development strategy shifted its focus from prioritizing current revenue growth to long-term optimization of operational efficiency and cost structure. Paid reading and continuous incubation of high-quality content are the core tasks of online business development, and the IP quantity, quality and influence of online literature platforms have been continuously improved.

In the first half of 2022, China Literature’s online business achieved revenue of 2.31 billion yuan, and MAU reached 265 million; during the platform period, about 300,000 writers and 600,000 novels were added, and the number of new words reached 16 billion. The content ecology continued to flourish, and There is a diversification trend. Taking sci-fi themes as an example, under the influence of the support mechanism and operational activities of Reading for potential themes, the sci-fi category has become the fastest-growing theme, with about 20,000 incubating works.

In the first half of the year, China Reading’s paid reading ecosystem has also been further consolidated. China Reading’s Qidian Reading App announced the brand upgrade, launched a new brand proposition “every good book is a new starting point” and the brand mission “let good scholars live endlessly”, established that it will focus on good books and focus on online literature Creation of high-quality content and IP incubation. As of June 2022, Yuewen had 8.1 million monthly paying users, and the average monthly income of each monthly paying user reached 38.8 yuan, a year-on-year increase of 6.6%.

The overseas market of China Literature’s online business continued to grow. As of June 30, 2022, overseas reading brand WebNovel has provided overseas users with about 2,600 Chinese translation works and about 420,000 local original works.

In addition, in order to protect the rights and interests of creators, China Literature has strengthened copyright protection, used a variety of technical means to improve anti-piracy capabilities, and continued to litigate against various pirated sites and infringing piracy, which has won great trust and recognition from writers. And it will help to further promote and improve the content ecology.

The IP ecological chain has outstanding visual systemization capabilities, and stable and continuous output of popular models

In the first half of the year, the copyright operation and other income of China Literature Group reached 1.78 billion yuan, which was stable year-on-year and increased by 14.3% month-on-month. In particular, IP visualization adaptations such as animation and film and television continue to maintain a first-line level, and the “frequent explosion of popular models” also confirms China Literature’s systematic ability in the visualization of the IP industry chain.

Taking animation as an example, in the first half of the year, Yuewen launched new episodes of “Star Change” and “Wudong Qiankun”, and the total playback volume of the animation series reached 4 billion and 3 billion respectively, and ranked among Tencent Video’s newly launched animations in the first half of the year. The first place in the average playback volume of the episode. In addition, the 300 online comics and comics projects that China Reading and Tencent Animation have cooperated with have more than 170 excellent comic works adapted from reading IPs, such as “Da Feng Da Changren”, “The First Sequence”, and “The Beginning of a Mountain”. When Tencent Animation was launched, the visualization process of IP animation reform continued to accelerate.

In terms of film and television, since the beginning of this year, China Literature has successively released many popular film and television hits and masterpieces, such as “The World”, “Home of the Heart”, “Wind in Longxi”, “Please Call Me Director”, and “This Killer Is Not Calm”. Among them, the TV series “The World” was adapted from the novel of the same name by contemporary writer Liang Xiaosheng who won the Mao Dun Literature Award. Double Harvest is a well-deserved hit this year; the ratings of “Home in the Heart” ranked first in the local TV’s prime TV drama in the first half of this year, and ranked second in iQiyi’s hot list in the first half of 2022, second only to “People” world”. The continuous and stable output of popular content has verified the excellent practical ability of Yuewen IP ecological chain visualization. The long-term serialization of high-quality IP dramas such as “Celebrating More Than Years”, “My Son-in-law” and “Da Feng Da Gengren” is also being actively promoted.

In addition, in the first half of 2022, China Literature will continue to build and consolidate the basic capabilities of IP commercialization, and has made preliminary progress. For example, the GMV of the single Medusa statue of “Breaking the Sphere” authorized by China Literature has reached 5 million. In the future, China Literature will also develop various forms of derivatives around more IPs, and cooperate with the launch of related film and television, animation, games and other content for joint promotion.

On August 15, China Literature Group (0772.HK) announced its 2022 interim results report. The performance report shows that in the first half of 2022, China Literature Group achieved a total revenue of 4.09 billion yuan; of which, the online business was 2.31 billion yuan, and the copyright operation and other income was 1.78 billion yuan. In terms of profit, the non-IFRS net profit attributable to the parent company was about 670 million yuan, operating profit increased by 8.2% year-on-year to 690 million yuan, and the operating profit margin increased from 14.8% in the same period last year to 17.0%.

During the reporting period, in the face of the ever-changing industry environment , China Literature conducted more forward-looking thinking and responded flexibly. In the first half of the year, China Literature focused more on key businesses and long-term goals, and took a series of measures to control costs and improve efficiency, which significantly improved the company’s operational efficiency. At the same time, China Literature continues to consolidate its advantages in core business, continue to promote the incubation and operation of IP, especially in the visual adaptation of IP , continues to produce explosive models, laying a good foundation for the long-term development of the IP ecological chain.

Cheng Wu, CEO of China Literature, said: “In the first half of the year, we launched a series of well-known first-line works, including the TV series “The World”, “Heart Home”, “Feng Qi Longxi”, “Please Call Me Director”, the movie “This Killer Is Not Too Calm”, as well as many animation works. The continuous output of high-quality content, especially popular models, confirms the systematic ability of Reading in the visualization of the industry chain, and also strongly supports the long-term strategy of IP visual upgrading. At the same time , as an important part of improving the content ecology, this year we have stepped up efforts to promote anti-piracy, and have gained great trust and recognition from writers. We will continue to adhere to the long-term strategy, focusing on the incubation, development and operation of good stories, so that Good stories keep coming.”

Focus on healthy and sustainable development, continuously incubate high-quality products and consolidate the IP content ecology

During the reporting period, China Literature continued to focus on the nature of its business, and continued to consolidate the IP ecosystem of online literature by focusing on core paid content. The platform development strategy shifted its focus from prioritizing current revenue growth to long-term optimization of operational efficiency and cost structure. Paid reading and continuous incubation of high-quality content are the core tasks of online business development, and the IP quantity, quality and influence of online literature platforms have been continuously improved.

In the first half of 2022 , China Literature’s online business achieved revenue of 2.31 billion yuan, and MAU reached 265 million; during the platform period, about 300,000 writers and 600,000 novels were added, and the number of new words reached 16 billion. The content ecology continued to flourish, and There is a diversification trend. Taking sci-fi themes as an example, under the influence of the support mechanism and operational activities of Reading for potential themes, the sci-fi category has become the fastest-growing theme, with about 20,000 incubating works.

In the first half of the year, China Reading’s paid reading ecosystem has also been further consolidated. China Reading’s Qidian Reading App announced the brand upgrade, launched a new brand proposition “every good book is a new starting point” and the brand mission “let good scholars live endlessly”, established that it will focus on good books and focus on online literature Creation of high-quality content and IP incubation. As of June 2022, Yuewen had 8.1 million monthly paying users, and the average monthly income of each monthly paying user reached 38.8 yuan, a year-on-year increase of 6.6%.

The overseas market of China Literature’s online business continued to grow. As of June 30, 2022, overseas reading brand WebNovel has provided overseas users with about 2,600 Chinese translation works and about 420,000 local original works.

In addition, in order to protect the rights and interests of creators, China Literature has strengthened copyright protection, used a variety of technical means to improve anti-piracy capabilities, and continued to litigate against various pirated sites and infringing piracy, which has won great trust and recognition from writers. And it will help to further promote and improve the content ecology.

The IP ecological chain has outstanding visual systemization capabilities, and stable and continuous output of popular models

In the first half of the year, the copyright operation and other income of China Literature Group reached 1.78 billion yuan, which was stable year-on-year and increased by 14.3% month-on-month. In particular, IP visualization adaptations such as animation and film and television continue to maintain a first-line level, and the “frequent explosion of popular models” also confirms China Literature’s systematic ability in the visualization of the IP industry chain.

Taking animation as an example, in the first half of the year, Yuewen launched new episodes of “Star Change” and “Wudong Qiankun”, and the total playback volume of the animation series reached 4 billion and 3 billion respectively, and ranked among Tencent Video’s newly launched animations in the first half of the year. The first place in the average playback volume of the episode. In addition, the 300 online comics and comics projects that China Reading and Tencent Animation have cooperated with have more than 170 excellent comic works adapted from reading IPs, such as “Da Feng Da Changren”, “The First Sequence”, and “The Beginning of a Mountain”. When Tencent Animation was launched, the visualization process of IP animation reform continued to accelerate.

In terms of film and television, since the beginning of this year, China Literature has successively released many popular film and television hits and masterpieces, such as “The World”, “Home of the Heart”, “Wind in Longxi”, “Please Call Me Director”, and “This Killer Is Not Calm”. Among them, the TV series “The World” was adapted from the novel of the same name by contemporary writer Liang Xiaosheng who won the Mao Dun Literature Award. Double Harvest is a well-deserved hit this year; the ratings of “Home in the Heart” ranked first in the local TV’s prime TV drama in the first half of this year, and ranked second in iQiyi’s hot list in the first half of 2022, second only to “People” world”. The continuous and stable output of popular content has verified the excellent practical ability of Yuewen IP ecological chain visualization. The long-term serialization of high-quality IP dramas such as “Celebrating More Than Years”, “My Son-in-law” and “Da Feng Da Gengren” is also being actively promoted.

In addition, in the first half of 2022 , China Literature will continue to build and consolidate the basic capabilities of IP commercialization , and has made preliminary progress. For example, the GMV of the single Medusa statue of “Fighting the Sphere” authorized by China Literature has reached 5 million. In the future, China Literature will also develop various forms of derivatives around more IPs, and cooperate with the launch of related film and television, animation, games and other content for joint promotion.