China Literature Announces 2023 Annual Results
HONG KONG, March 18, 2024 /PRNewswire/ -- China Literature Limited ("China Literature" or "the Company", stock code: 0772), a leading online literature and intellectual property ("IP") incubation platform in China, today announced the audited consolidated results for the year ended December 31, 2023.
Results Highlights ((1))
-- Total revenues were RMB7,011.8 million (USD990.0 million), compared with
RMB7,625.6 million in 2022.- Revenues from online business were
RMB3,948.1 million (USD557.4 million), compared with RMB4,364.0 million
in 2022. This was attributed to our ongoing initiative to shift away
from channels with low return on investment ("ROI") and to focus on
high-quality growth.- Revenues from IP operations and others
excluding New Classics Media ("NCM") increased by 10.1% to RMB1,803.4
million (USD254.6 million); when including NCM, revenues from IP
operations and others decreased by 6.1% to RMB3,063.6 million (USD432.6
million).
-- On a non-IFRS( (2)) basis, which is intended to reflect core earnings by
excluding certain one-time and/or non-cash items:- Operating
profit was RMB1,049.8 million (USD148.2 million), compared with
RMB1,363,9 million in 2022.- Profit attributable to equity
holders of the Company was RMB1,130.4 million (USD159.6 million),
compared with RMB1,348.2 million in 2022.- Basic earnings per
share were RMB1.12. Diluted earnings per share were RMB1.11.
-- On an IFRS basis:- Operating profit was RMB709.3 million
(USD100.1 million), compared with RMB628.8 million in 2022.-
Profit attributable to equity holders of the Company was RMB804.9
million (USD113.6 million), compared with RMB608.2 million in 2022.-
Basic earnings per share were RMB0.80. Diluted earnings per share were
RMB0.79.
1. Figures stated in USD are based on USD1 to RMB7.0827.
2. Non-IFRS adjustments exclude share-based compensation, M&A related impact such as net losses from investee companies and amortization of intangible assets, as well as related income tax effects.
3. Certain figures included in this press release have been subject to rounding adjustments. Accordingly, figures shown as totals may not be an arithmetic aggregation of the figures shown in the breakdown items.
Mr. Hou Xiaonan, Chief Executive Officer of China Literature, commented, "In 2023, China Literature continued to build a comprehensive IP development framework encompassing a variety of content formats and covering every stage of the content lifecycle. Additionally, we equipped creators with cutting-edge AI tools to enhance our content ecosystem. The number of literary works that newly reached 100,000 average subscribers per chapter across the platform increased 125% year-over-year, and our MPUs increased 10.1% year-over-year to 8.7 million. With operational efficiency steadily improving, operating profit increased 12.8% from a year earlier to RMB709 million. Profit attributable to equity holders of the Company rose 32.3% to RMB805 million year-over-year, while its margin expanded from 8.0% to 11.5%.
Over the course of the year, China Literature continued to make significant progress in both the visualization and monetization of its IP, offering users a strong lineup of high-quality works, including dramas series such as 'In Spite of the Strong Wind (?????),' 'The Road to Ordinary (????),' 'Sunshine by My Side (????)' and 'The Infiltrator (???),' as well as new animation seasons for classic IP franchises including 'Battle Through the Heavens (????),' 'Stellar Transformations (???),' 'Almighty Mage (????)' and 'Martial Universe (????).' Within our comics business, we announced the acquisition of the assets of Tencent Animation and Comics, which will expand our IP portfolio to include top Chinese comic titles such as 'The Outcast (????)' and 'The Fox Spirit Matchmaker (?????).' This transaction will also strengthen our pipeline of comic adaptations and increase our production capacity for animated series. Furthermore, we are actively exploring new forms of content and venturing into the high-quality short drama vertical where we are achieving initial success.
2023 was a pivotal year for innovation and breakthroughs in AI technology. We launched the first Large Language Model designed specifically for the online literature industry, 'Smart Pen,' and the 'Smart Pen Edition for the Author Assistant Application,' making it available to all contracted writers. The AI features have generated weekly engagement rates of 30%, underscoring their attractiveness and usefulness. China Literature also plans to leverage AI to enhance the adaptation of online literature into animated series and comics, accelerating the process of converting text-based IPs into visual formats. Additionally, we have made significant progress in AI translation, which has been instrumental in expanding our online literature business globally. In December 2023, AI-translated works accounted for 21 of the top 100 bestsellers on our foreign language online reading platform. Looking ahead, we firmly believe that 'Smart Pen' and various other AI tools will unlock additional possibilities for creators, users, and partners. This will accelerate the release of IP value and enhance commercial efficiency, directly supporting our mission to create good stories that will live forever."
Financial Review( (3))
Revenues were RMB7,011.8 million (USD990.0 million), compared with RMB7,625.6 million in 2022.
Revenues from online business were RMB3,948.1 million (USD557.4 million), compared with RMB4,364.0 million in 2022. A further breakdown of this category is as follows:
i) Online business revenues from our self-owned platform products decreased slightly from RMB3,482.9 million in 2022 to RMB3,413.9 million (USD482.0 million), mainly due to our continuous efforts to move away from low-ROI distribution channels and improve the operational efficiency of our online reading business. In addition to narrowing our distribution channels, we focused on producing high-quality content, implementing effective anti-piracy measures, and improving core product operations. These efforts drove solid performance in a number of areas; for example, Qidian Reading, one of our flagship products, saw revenue growth of approximately 40% year-over-year;
ii) Online business revenues from our channels on Tencent products were RMB341.7 million (USD48.2 million), compared with RMB591.0 million in 2022, partly due to steps we took to refine our content distribution practices as we chose to distribute more content through our core pay-to-read products with higher ROI, leading to a decrease in advertising revenues. The decline was also influenced by initiatives we took to optimize distribution channels on Tencent products; and
iii) Online business revenues from third-party platforms were RMB192.6 million (USD27.2 million), compared with RMB290.2 million in 2022, primarily due to the suspension of collaboration with certain third-party distribution partners.
Revenues from IP operations and others were RMB3,063.6 million (USD432.6 million), compared with RMB3,261.6 million in 2022.
i) Revenues from IP operations were RMB2,973.8 million (USD419.9 million), compared with RMB3,160.2 million in 2022. The decrease was mainly due to reduced revenues from NCM, as fewer total number of drama series and film projects were released in 2023 compared with 2022. Excluding the impact of NCM, revenues from IP operations grew over 10% year-over-year, mainly driven by increased revenues from our licensing of copyrights, self-operated online games, and animated series; and
ii) Revenues from the "others" category, consisting mainly of sales of physical books were RMB89.8 million (USD12.7 million), compared with RMB101.4 million in 2022.
Cost of revenues increased slightly by 1.2% year-over-year to RMB3,640.3 million (USD514.0 million), mainly due to an increase in content costs as we boosted investment in high-quality content during 2023, which was mostly offset by a reduction in production costs related to drama series and films, lower platform distribution costs, and a decrease in amortization of intangible assets.
Gross profit was RMB3,371.5 million (USD476.0 million), compared with RMB4,030.1 million in 2022. Gross margin was 48.1%, compared with 52.8% in 2022.
Interest income increased 3.4% year-over-year to RMB166.3 million (USD23.5 million), reflecting greater interest income from bank deposits.
Other gains, net were RMB11.5 million (USD1.6 million) in 2023, compared with net other losses of RMB207.1 million in 2022. The year-over-year difference was mainly due to net fair value changes related to certain investee companies and acquisitions.
Selling and marketing expenses decreased 14.1% year-over-year to RMB1,719.5 million (USD242.8 million), as a result of i) reduced promotion and advertising expenses for our online business as a part of our cost control and efficiency improvement initiatives; and ii) a decrease in marketing expenses associated with drama series and film promotion, due to the lower total number of releases in 2023. As a percentage of revenues, selling and marketing expenses decreased to 24.5% in 2023 from 26.3% in 2022.
General and administrative expenses decreased 6.2% year-over-year to RMB1,161.0 million (USD163.9 million), primarily attributable to reduced expenses associated with employee benefits. As a percentage of revenues, general and administrative expenses were 16.6% in 2023, compared with 16.2% in 2022.
Net reversal of impairment losses on financial assets was RMB40.6 million (USD5.7 million) in 2023, primarily due to the collection of doubtful receivables associated with IP businesses which were impaired in prior years.
Operating profit increased 12.8% year-over-year to RMB709.3 million (USD100.1 million) from RMB628.8 million in 2022.
Income tax expense was RMB97.9 million (USD13.8 million), compared with RMB166.2 million in 2022, primarily due to changes in taxable income.
Profit attributable to equity holders of the Company increased 32.3% year-over-year to RMB804.9 million (USD113.6 million) from RMB608.2 million in 2022.
Key Operating Information
- Average MAUs on our self-owned platform products and self-operated channels were 205.6 million, a decrease of 15.7% year-over-year from 243.9 million. A further breakdown of MAUs is as follows:
i) MAUs on our self-owned platform products decreased 4.7% year-over-year from 110.0 million to 104.8 million, mainly due to our decision to cut marketing spending on low-ROI user acquisition channels as part of our overall efforts to improve operational efficiency. At the same time, we intensified our efforts to engage our core user base, as evidenced by the continued year-over-year growth in MAUs of our flagship reading product, Qidian Reading; and
ii) MAUs on our self-operated channels on Tencent products decreased 24.7% year-over-year from 133.9 million to 100.8 million, primarily due to our efforts to optimize content offerings and distribution channels to enhance our operational efficiency.
- Average MPUs on our self-owned platform products and self-operated channels increased 10.1% year-over-year from 7.9 million to 8.7 million in 2023. In particular, MPUs on our self-owned platform products increased over 20% year-over-year, reflecting the positive results of our ongoing and effective anti-piracy measures, enhanced product operation capabilities, and consistent delivery of high-quality content.
- Monthly ARPU for our pay-to-read business was RMB32.5, decreasing 14.0% year-over-year from RMB37.8 in 2022, due to i) changes in revenue mix from various product offerings, and ii) lower user spending from some newly converted paying users at the initial stage of the payment cycle.
Other Key Information
- EBITDA was RMB829.5 million (USD117.1 million), compared with RMB1,052.8 million in 2022. Adjusted EBITDA was RMB1,017.9 million (USD143.7 million), compared with RMB1,350.6 million in 2022.
- As of December 31, 2023, the Company's net cash position was RMB8,101.4 million (USD1,143.8 million).
- Free cash flow* was RMB872.8 million (USD123.2 million), compared to RMB1,182.7 million in 2022.
- New Classics Media, on a standalone basis, recorded RMB1,260.2 million (USD177.9 million) in revenues and RMB487.2 million (USD68.8 million) in profit attributable to equity holders of the company in 2023.
* Free cash flow: operating cash flow deducts payments for lease liabilities and payments for capital expenditures.
Business Review and Outlook
IP Creation
Our online reading business continues to make significant progress, adding 380,000 writers, 670,000 literary works, and more than 39 billion Chinese characters of content in 2023. New writers in particular are making a significant impact. The number of new writers whose books generated more than RMB100,000 in annual revenue increased by 60% in 2023 year-over-year. Among the new books with over RMB1 million in revenue in 2023, nearly a third were written by our new writers. In addition, the number of works written by writers born after the year 2000 with more than 10,000 average subscribers per chapter soared by 230% year-over-year.
Our growing library of creators and literary works continues to drive content quality to new heights. In 2023, the number of literary works that newly reached 100,000 average subscribers per chapter across the platform increased 125% year-over-year, and various other subscription records were broken. Our enhanced middle office, dedicated to nurturing and supporting our content creation ecosystem, is fueling this surge. This includes:
-- Anti-piracy measures which have continued to achieve breakthroughs.
Throughout the year, we championed creativity by removing 1.1 million
links to pirated content to safeguard authors' interests, boost
subscription numbers, and foster a healthier content ecosystem.
-- Our proprietary "Smart Pen Edition for the Author Assistant
Application," leveraging our "Smart Pen" Large Language Model (LLM), is
now accessible to all contracted writers. This cutting-edge tool sets a
new benchmark in online literature creation. The weekly engagement rate
with its AI features has reached 30%.
-- Our innovative approach to building an interactive user community has
strengthened the bond between our readers and our IP. In 2023, the
number of new literary works with over one million user comments grew
67% year-over-year while the number of literary works with more than
100,000 monthly user votes grew 66% year-over-year. MPUs also grew
nicely in 2023, increasing 10.1% year-over-year to 8.7 million.
IP Visualization
In 2023, We continued to advance the visualization of our IP, offering our users a diverse selection of high-quality works.
-- In the live action TV and film segment, following the debuts of "The
Road to Ordinary (????)" and "In Spite of the Strong Wind (?????)" in
the first half of the year, we released a number of drama series in the
second half, such as "Sunshine by My Side (????)" and "The Infiltrator
(???)." Among these, "Sunshine by My Side (????)" ranked first in daily
viewership across all channels for 16 consecutive days, according to
Kuyun. "The Infiltrator (???)" ranked first in prime-time drama series
ratings nationwide during its broadcast run, according to metrics from
China Audio Video Big Data.
-- In the animation segment, new seasons for classic IP franchises
including "Battle Through the Heavens (????)," "Stellar Transformations
(???)," "Almighty Mage (????)" and "Martial Universe (????)" were
released during the period as well as the new animated series
"Transcending the Nine Heavens (?????)" and "Mysterious Treasures (??)."
Each of these titles was released to widespread praise from audiences.
In particular, the 52-week season of "Battle Through the Heavens (????)"
was a fan favorite, dominating Weibo's domestic animation popularity
rankings for three months straight, maintaining its position as the most
popular animated series on the Chinese internet. Our animated works
continued to lead the market in terms of quantity, quality and hit rate.
According to Enlightent, six of the top ten most-streamed online
animated series in 2023 were adapted from China Literature IP.
-- In the comics segment, 13 of our newly released adapted comic series
broke the 100 million benchmark in popularity in 2023. In addition, the
acquisition of the assets of Tencent Animation and Comics will further
enrich our portfolio of IP including top Chinese comic IPs such as "The
Outcast (????)" and "The Fox Spirit Matchmaker (?????)." The move also
bolsters our pipeline of comic adaptations and expands our production
capacity for animated series. Going forward, we plan to leverage AI
technologies to enhance the adaptation of online literature into
animated series and comics, accelerate the adaptation process of
text-based IPs into visual formats and enhance the efficiency of content
commercialization.
IP Commercialization and Monetization
-- In the IP merchandise segment, we unveiled a diverse array of trendy
collectibles and merchandise based on popular IPs such as "Lord of the
Mysteries (????)," "The King's Avatar (????)" and "Battle Through the
Heavens (????)." We have a bunch of products including blind boxes, toy
collectables, accessories and cards, all of which are highly
sought-after. We've also broadened our IP licensing, collaborating with
a diverse array of consumer brands across multiple industries such as
digital 3C products, food and beverages, and automotive. This has been
highly popular and is effectively driving sales for our partners. In
2024, we plan to enter new merchandise categories and explore synergies
between our merchandise and various content formats. By strategically
timing our merchandise launches with the release of the associated film,
TV series and animated series, we aim to amplify the hype surrounding
our IPs.
-- In the games segment, licensed games based on our popular IPs were
successfully launched in 2023 including "A Record of a Mortal's Journey
to Immortality (?????)" and "Swallowed Star (????)". This will be
followed up with the expected launch of several other licensed games
this year, including "Soul Land (????)," "Battle Through the Heavens
(????)" and "Cultivation Chat Group (????????)" which have all received
regulatory approval. In terms of in-house game operations, we launched
expansion packs with enhanced graphics and interactive features for our
classic game "New Soul Land (?????)". We will continue to roll out
upgrades and improved gameplay to ensure our players have an exceptional
gaming experience.
Innovation in Technology and Business
We have long maintained the conviction that only through innovation can we make true breakthroughs. In 2023, we identified several new opportunities which we will take advantage of.
-- As previously mentioned, we launched the first LLM designed specifically
for the online literature industry, "Smart Pen," and the "Smart Pen
Edition for the Author Assistant Application," which will support
writers with various aspects of content creation. As AI technology
continues to evolve, we see its potential to unlock significant value in
our IP. AI promises to open doors for the adaption of a wider range of
literary works, accelerate the transformation from text to visual
formats, and pave the way for faster commercialization.
-- We've officially entered the high-quality short drama segment with the
rollout of our "Short Drama Star Incubation Plan." This initiative will
support more than 100 short drama series by establishing a creative fund
with over RMB100 million, as well as pioneer the interactive short drama
format. So far, several of our short drama series have surpassed RMB10
million in gross revenue.
-- We continued to expand into overseas markets. By the end of 2023, our
foreign language online reading platform, WebNovel, offered around 3,800
works translated from Chinese and about 620,000 original works created
locally. We continued to enhance our AI translation models throughout
the year, leading to a wealth of top-tier works being translated. In
December 2023, AI-translated works accounted for 21 of the top 100
bestsellers on WebNovel. AI-driven translation is the catalyst for our
multilingual expansion overseas and we expect it will continue to drive
our growth and establish competitive advantages in specific genres in
key overseas regions.
Outlook
We are confident that 2024 will be a year of blockbusters for China Literature. At present, the number of pre-registration for "Joy of Life 2 (???2)" has exceeded 12 million, making the drama series the first to pass the 10 million pre-registration threshold across all platforms. In Tencent Video's most anticipated list, we have three drama series ranking among the top 10, including "Joy of Life 2 (???2)," "The Legend of Shen Li (???)" and "Dafeng Guardian (?????)." In an evolving industry, China Literature stands ready, armed with a portfolio of high-quality content, ecosystem partnerships and cutting-edge technologies. Our commitment to our foundational values - content, platform and IP - remains steadfast as we continue to create good stories that will live forever.
About China Literature Limited
China Literature is dedicated to building a deep and immersive intellectual property ("IP") universe for the Mandarin-speaking world. It incubates original IPs from its online literature platform, which are subsequently adapted to a range of digital entertainment mediums, including comics, animation, film, TV series, web series and games. The virtual world created by these digital offerings becomes an inseparable part of a user's daily life. China Literature creates and promotes IPs mainly through Qidian Reading and QQ Reading, its leading online literature platforms, as well as New Classics Media, a renowned film and TV drama series production house in China. China Literature collaborates with Tencent, its shareholder and strategic partner, as well as other third-party partners to distribute and develop IP content and to enhance the value of its IP. Many of the Company's online literature works have been successfully adapted into animation, TV series, web series, films and games, including Joy of Life, Candle in the Tomb, Soul Land, The King's Avatar and My Heroic Husband. China Literature's rich and extensive content library as well as its unparalleled capability and resources to adapt IP into various entertainment formats is a significant competitive advantage that lies at the core of its business model. For more information, please visit http://ir.yuewen.com/.
Contact
For investors / analysts:
Maggie Zhou
Tel: +8621 6187 0500 ext. 80605
Email: IR@yuewen.com
For media:
Vivian Wang
Tel: +852 2232 3978
Email: vivian.wang@christensencomms.com
Non-IFRS Financial Measures
To supplement the consolidated financial statements of the Company prepared in accordance with IFRS, certain non-IFRS financial measures, namely non-IFRS operating profit, non-IFRS operating margin, non-IFRS profit for the year, non-IFRS net margin, non-IFRS profit attributable to equity holders of the Company, non-IFRS basic EPS and non-IFRS diluted EPS as additional financial measures, have been presented in this press release for the convenience of readers. These unaudited non-IFRS financial measures should be considered in addition to, and not as a substitute for, measures of the Company's financial performance prepared in accordance with IFRS. These unaudited non-IFRS measures may be defined differently from similar terms used by other companies. In addition, non-IFRS adjustments include relevant non-IFRS adjustments for the Company's material associates based on available published financials of the relevant material associates, or estimates made by the Company's management based on available information, certain expectations, assumptions and premises.
Our management believes that the presentation of these non-IFRS financial measures, when shown in conjunction with the corresponding IFRS measures, provides useful information to investors and management regarding the financial and business trends relating to the Company's financial condition and results of operations. Our management also believes that the non-IFRS financial measures are useful in evaluating the Company's operating performances. From time to time, there may be other items that the Company may include or exclude in reviewing its financial results.
Forward-Looking Statements
This press release contains forward-looking statements relating to the industry and business outlook, forecast business plans and growth strategies of the Company. These forward-looking statements are based on information currently available to the Company and are stated herein on the basis of the outlook at the time of this press release. They are based on certain expectations, assumptions and premises, some of which are subjective or beyond our control. These forward-looking statements may prove to be incorrect and may not be realized in future. Underlying the forward-looking statements is a large number of risks and uncertainties. Further information regarding these risks and uncertainties is included in our other public disclosure documents on our corporate website.
CHINA LITERATURE
CONSOLIDATED INCOME STATEMENT
Year ended December 31,
2023 2022
(RMB in million, unless
specified)
Revenues
Online business(1) 3,948.1 4,364.0
Intellectual property operations and
others(2) 3,063.6 3,261.6
7,011.8 7,625.6
Cost of revenues (3,640.3) (3,595.5)
Gross profit 3,371.5 4,030.1
Gross margin 48.1 % 52.8 %
Interest income 166.3 160.9
Other gains/(losses), net 11.5 (207.1)
Selling and marketing expenses (1,719.5) (2,002.6)
General and administrative expenses (1,161.0) (1,238.2)
Net reversal of/(provision for) impairment losses 40.6 (114.3)
on financial assets
Operating profit 709.3 628.8
Operating margin 10.1 % 8.2 %
Finance costs, net (12.9) (54.0)
Share of net profit of associates and joint ventures 205.0 199.0
Profit before income tax 901.4 773.8
Income tax expense (97.9) (166.2)
Profit for the year 803.5 607.6
Net margin 11.5 % 8.0 %
Profit
attributable to:
Equity holders of the Company 804.9 608.2
Non-controlling interests (1.3) (0.6)
803.5 607.6
Earnings per share
(in RMB per share)
- Basic earnings per share 0.80 0.60
- Diluted earnings per share 0.79 0.59
Notes:
(1) Revenues from online business primarily reflect revenues from online paid reading, online advertising and distribution of third-party online games on our platform.
(2) Revenues from intellectual property operations and others primarily reflect revenues from production and distribution of TV, web and animated series, films, licensing
of copyrights, operation of self-operated online games, and sales of physical books.
CHINA LITERATURE
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Year ended December
31,
2023 2022
(RMB in million)
Profit for the year 803.5 607.6
Other comprehensive income:
Item that may be subsequently reclassified to profit or
loss
Share of
other
comprehensive
(loss)/income
of (0.6) 4.7
associates and joint
ventures
Currency
translation
differences (21.7) 62.9
Item that may not be reclassified to profit or loss
Net loss
from
change in
fair value
of
financial
asset (4.3) (7.5)
at fair value through
other comprehensive
income
Currency
translation
differences 66.4 54.8
39.8 114.8
Total comprehensive income for the year 843.3 722.4
Total comprehensive income attributable to:
Equity
holders of
the
Company 844.6 722.8
Non-
controlling
interests (1.3) (0.4)
843.3 722.4
CHINA LITERATURE
SEGMENT INFORMATION
Year ended December 31,
2023 2022
(RMB in million, except
percentages)
Revenues
Online business 3,948.1 4,364.0
Intellectual property operations
and others 3,063.6 3,261.6
Total revenues 7,011.8 7,625.6
Cost of revenues
Online business (1,983.5) (2,217.2)
Intellectual property operations
and others (1,656.8) (1,378.3)
Total cost of revenues (3,640.3) (3,595.5)
Gross profit
Online business 1,964.6 2,146.8
Intellectual property operations
and others 1,406.9 1,883.3
Total gross profit 3,371.5 4,030.1
Gross margin
Online business 49.8 % 49.2 %
Intellectual property operations
and others 45.9 % 57.7 %
Total gross margin 48.1 % 52.8 %
CHINA LITERATURE
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As of
December 31, 2023 December 31, 2022
(RMB in million)
ASSETS
Non-current assets
Property, plant and equipment 128.3 132.9
Right-of-use assets 207.7 183.1
Intangible assets 7,330.1 7,421.6
Investments in associates and
joint ventures 924.7 1,008.8
Financial assets at fair
value through profit or loss 856.0 862.2
Financial asset at fair value
through other 4.1 8.0
comprehensive income
Deferred income tax assets 394.1 312.3
Prepayments, deposits and
other assets 291.6 329.6
Term deposits 1,829.0
11,965.7 10,258.6
Current assets
Inventories 743.7 760.3
Television series and film
rights 995.1 940.4
Financial assets at fair
value through profit or loss 2,442.7 119.3
Trade and notes receivables 1,988.2 2,048.9
Prepayments, deposits and
other assets 1,212.6 1,212.5
Term deposits 1,038.7 1,848.7
Cash and cash equivalents 2,801.8 5,545.8
11,222.8 12,475.9
Total assets 23,188.5 22,734.5
EQUITY
Capital and reserves attributable to
the
equity
holders of the Company
Share capital 0.7 0.6
Shares held for RSU schemes (16.6) (18.8)
Share premium 16,312.6 16,223.3
Other reserves 2,173.3 1,955.1
Retained earnings/
(accumulated losses) 555.0 (202.9)
19,024.9 17,957.3
Non-controlling interests (0.5) (2.6)
Total equity 19,024.4 17,954.7
As of
December 31, 2023 December 31, 2022
(RMB in million)
LIABILITIES
Non-current liabilities
Lease
liabilities 153.2 134.6
Long-term
payables 1.2 4.7
Deferred
income
tax
liabilities 134.5 139.6
Deferred
revenue 24.2 26.5
Financial
liabilities
at fair
value
through
profit or
loss 247.8 490.6
560.9 796.0
Current liabilities
Borrowings 10.0 417.9
Lease
liabilities 74.9 65.5
Trade
payables 1,119.7 1,203.9
Other
payables
and
accruals 997.7 1,019.4
Deferred
revenue 879.3 619.1
Current
income
tax
liabilities 266.4 275.8
Financial
liabilities
at fair
value
through
profit or
loss 255.1 382.2
3,603.1 3,983.8
Total liabilities 4,164.0 4,779.8
Total equity and liabilities 23,188.5 22,734.5
CHINA LITERATURE
RECONCILIATION OF OPERATING PROFIT TO EBITDA AND ADJUSTED EBITDA
Year ended December 31,
2023 2022
(RMB in million)
Reconciliation of operating profit to EBITDA and
adjusted EBITDA:
Operating profit 709.3 628.8
Adjustments:
Interest income (166.3) (160.9)
Other (gains)/losses, net (11.5) 207.1
Depreciation of property, plant and equipment 33.4 21.4
Depreciation of right-of-use assets 82.0 95.1
Amortization of intangible assets 182.7 261.2
EBITDA 829.5 1,052.8
Adjustments:
Share-based compensation 131.5 241.3
Expenditures related to
acquisition 56.9 56.5
Adjusted EBITDA 1,017.9 1,350.6
CHINA LITERATURE
RECONCILIATIONS OF IFRS TO NON-IFRS RESULTS
Year ended December 31, 2023
Adjustments
As Share- Net losses from Amortization Tax effect Non-IFRS
reported based investments and of
intangible
compensation acquisitions(1) assets(2)
(RMB in million, unless specified)
Operating profit 709.3 131.5 188.9 20.2 1,049.8
Profit for the
year 803.5 131.5 182.2 20.2 (8.3) 1,129.0
Profit attributable to equity 804.9 131.5 182.2 20.2 (8.3) 1,130.4
holders of
the
Company
EPS
(RMB per share)
-
basic 0.80 1.12
-
diluted 0.79 1.11
Operating margin 10.1 % 15.0 %
Net margin 11.5 % 16.1 %
Year ended December 31, 2022
Adjustments
As Share- Net losses from Amortization Tax effect Non-IFRS
reported based investments and of intangible
compensation acquisitions(1) assets(2)
(RMB in million, unless specified)
Operating profit 628.8 241.3 461.6 32.2 1,363.9
Profit for the
year 607.6 241.3 469.4 32.2 (2.9) 1,347.7
Profit attributable to equity 608.2 241.3 469.4 32.2 (2.9) 1,348.2
holders of
the
Company
EPS
(RMB per
share)
-
basic 0.60 1.33
-
diluted 0.59 1.32
Operating margin 8.2 % 17.9 %
Net margin 8.0 % 17.7 %
Notes:
(1) Mainly includes the disposal gain, impairment provision and the fair value changes arising from our investee companies, the fair value changes of consideration liabilities related
to the acquisition of NCM, and the compensation costs for certain employees and former owners of NCM.
(2) Represents amortization of intangible assets and TV series and film rights resulting from acquisitions.
View original content:https://www.prnewswire.com/news-releases/china-literature-announces-2023-annual-results-302091247.html
SOURCE China Literature
