Game company mid-year entrance examination: 13 companies with revenues exceeding one billion and 20% of companies including No.
Sino-Singapore Jingwei Client, September 10 (Zhao Jiaran) Under the influence of the epidemic, the "home economy" has greatly stimulated users' demand for games.
According to statistics, sales in the Chinese game market in the first half of the year were nearly 140 billion yuan, a year-on-year increase of 22.34%.
Source: Game Working Committee of China Music and Digital Association, China Game Industry Research Institute
The Sino-Singapore Jingwei client combed the semi-annual report of A-share online game companies and found that about 80% of the company’s net profit attributable to the parent in the first half of the year was positive. Only Baibai Holdings, Ren Zixing, Aofei Entertainment, Starlight Entertainment, Zhongying Internet, Ciwen Media and The net profit attributable to the parent of the seven companies of 35 Internet was negative in the first half of the year.
Looking forward to the second half of the year, are the gaming giants still confident to ensure performance growth?
13 companies' revenue in the first half of the year exceeded 1 billion 37 Mutual Entertainment reached the top
According to Wind statistics, the A-share online game sector contains 37 companies, of which 30 companies have a positive net profit attributable to shareholders of the parent company in the first half of the year, accounting for 81.08%.
Among them, 16 companies had net profits of over 100 million in the first half of the year, and 13 companies had revenues of over 1 billion.
The top three in terms of revenue in the first half of the year were 37 Interactive Entertainment, Century Huatong and Perfect World.
In the first half of the list, Sanqi Mutual Entertainment achieved revenue of 7.989 billion yuan in the first half of the year, a year-on-year increase of 31.59%; net profit attributable to shareholders of listed companies was 1.70 billion yuan, a year-on-year increase of 64.53%.
The revenue growth of the mobile game business can be said to be a strong pillar of Sanqi Mutual Entertainment.
During the reporting period, the company’s mobile game business achieved operating income of 7.412 billion yuan, a year-on-year increase of 36.59%, which was the main driving force for revenue and profit growth. According to the Analysys report, the market share of the mobile game business of 37 interactive entertainment in the first quarter of this year The rate is 10.51%.
Source of some mobile games under Sanqi Mutual Entertainment: 37 online games official website
In addition to Sanqi Mutual Entertainment, Kunlun Wanwei, Century Huatong, and Perfect World are among the leading companies in the net profit.
Among them, Kunlun Wanwei topped the list with a net profit of 3.675 billion yuan, a year-on-year increase of 524.74%, the highest increase since its listing.
It is worth noting that during the reporting period, the company will hold Grindr Inc.
The equity was transferred to San Vicente Acquisition LLC, and the investment income confirmed in the transaction during the reporting period was nearly 3 billion yuan.
In addition to the above-mentioned leading companies, the gaming business of major Internet companies such as Tencent and NetEase has also attracted attention.
In the first half of this year, the mobile games "Peace Elite" and "Glory of the King" are still Tencent's gold-sucking weapons.
The semi-annual report shows that Tencent's online game revenue in the second quarter increased by 40% to 38.288 billion yuan, while revenue from client games such as "DNF" and "Cross Fire" declined.
Tencent and NetEase's game business revenue in the first half of the year were 75.59 billion yuan and 27.35 billion yuan respectively.
GF Securities believes that game giants such as Tencent and NetEase have achieved a quarter-on-quarter growth in the second quarter after the dividends formed by the "Spring Festival + Epidemic" gradually dissipated, indicating that the gaming industry's payment rate and new user retention may be better than market expectations. In addition, overseas dividends are also A big plus for supporting industry growth.
Riding on the east wind of the "home economy", most game companies have seen significant growth in performance, but there are also companies that are unable to make ends meet and even suffer large losses.
Wind data shows that seven companies in the online game sector have negative net profits attributable to their parent in the first half of the year, including Baibai Holdings, Renzixing, Aofei Entertainment, Starlight Entertainment, Zhongying Internet, Ciwen Media and 35 Internet.
Among the above-mentioned loss-making companies, Haobai Holdings had the highest net loss of 86,694,400 yuan, and a net profit of 46,315,600 yuan in the same period last year; operating income was 1.446 billion yuan, a year-on-year decrease of 24.12%.
According to the semi-annual report, the company's main business model is to provide Internet entertainment content operation services. The turn from profit to loss this time is mainly due to the continuous increase of investment in user promotion and other aspects of the 5G Internet application business during the product introduction period, and the relative delay of business settlement.
From the perspective of financial reports, the performance of some companies has been dragged down by businesses other than games.
Take Xinghui Entertainment as an example. Its main business includes games, football clubs and toys. Among them, the game business with the highest proportion has basically the same performance, with revenue of 381 million yuan, a year-on-year increase of only 1.23%; while football club and toy business revenue They were down 35.90% and 49.02% year-on-year respectively, among which player transfer revenue dropped the most, reaching 90.26%.
The company's revenue in the first half of the year fell by 24.53% to 847 million yuan, and the net loss attributable to listed shareholders was 44.03 million yuan, which turned from profit to loss, and net profit fell by 134.97%.
The momentum of "going to sea" is still strong
Judging from the performance of game companies in the first half of the year, the game's "sea craze" continues.
According to the "Report on China's Game Industry for January-June 2020", game companies are actively expanding overseas markets. The actual sales revenue of China's self-developed games overseas has increased from US$6.024 billion in July-December 2019 to January-June 2020. The increase rate was higher than the domestic market, and the year-on-year increase rate reached 36.32%, maintaining a rapid growth momentum.
From the perspective of the types of games going to sea, strategy, shooting, and role-playing games are the most popular.
Source: Game Working Committee of China Music and Digital Association, China Game Industry Research Institute
Taking the semi-annual report of a leading company as an example, Kunlun Wanwei stated that it has established subsidiaries in Japan, Malaysia, the United States, the United Kingdom and other regions, and overseas business income has always accounted for a large proportion of total income.
Among the company's five main mobile games in the first half of the year, one of them was operated overseas, and the revenue of a single game accounted for 8.48% of the revenue of the game business. However, its promotion expenses accounted for the highest proportion of the total promotion and marketing expenses of the five, reaching 27.93%.
Sanqi Mutual Entertainment also said that in the first half of the year, the company's overseas business revenue increased by 94.77% year-on-year, and a variety of games had a good response in markets such as Japan and Vietnam.
During the reporting period, overseas business revenue was 969 million yuan, accounting for 12.13% of total revenue from 8.19% in the same period last year.
According to the "2020 China Mobile Games Driving Force Report" released by Google, Appsflyer and Appannie, under the new normal, Chinese games going overseas will continue to maintain healthy growth, and games going overseas have transitioned from quantitative changes to qualitative changes.
From the perspective of growth strategies, mobile game publishers should go deep into key markets, increase fundamental operational investment, and highlight the differentiation of game products.
Where to borrow the "East Wind" in the second half of the second half of the "home economy" dividend?
With the resumption of work and production in various industries in China and the opening of schools, the dividends brought by the "home economy" are gradually declining. How game companies maintain their performance in the fierce competition in the second half of the year has attracted attention from the industry.
Judging from the release of domestic game version numbers in August and September, many listed companies are planning or have new games online, including NetEase "Fantasy Book Qishilu", Sanqi Mutual Entertainment "Dragon Knight Awakening", and Gigabit. "Sword Opens the Fairy Gate", and "Wandering Mountains and Seas" published by Tencent and developed by Pixel Software.
Northeast Securities stated in a research report that the game industry has returned to high growth, and the annual scale is expected to exceed 270 billion. Among them, the mobile game is the main driving force for growth, and the stability of the game industry's revenue has been gradually proven.
On the other hand, the growth of users in the gaming industry has slowed down, entering an era driven by ARPU (average revenue per user) growth.
Northeast Securities also pointed out that in terms of user behavior, games are essentially optional consumer goods, and the domestic market has not yet recognized the consumption value of games.
Whether it is from the long-term development of overseas game stocks or from the benchmarking of domestic and other consumer optional products, the process of increasing the recognition of games as optional consumer goods is also the process of increasing the value of game companies.
Shanghai Securities believes that overall, the performance of the A-share game sector in the first half of the year is in line with expectations; in the second half of the year, new games may become an important factor in the trend of the sector. The number of new games and their pros and cons will lead to a significant differentiation in the performance of the sector companies. Companies that perform particularly well will have further open up space for their valuations. It is expected that the degree of intense competition in the new game market will likely rise rapidly in the future.
(Zhongxin Jingwei APP)
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