Stock Code: 603444 Stock Name: G-bits
G-bits Network Technology (Xiamen) Co., Ltd.
2023 Interim Report (Summary)
August 2023
Should there be any discrepancy between the English version and the Chinese version of this Report, the
Chinese version shall prevail.
Part I Important Notes
1.1 This interim report summary is derived from the full text of the interim report. In order
to have a comprehensive understanding of the Company's operating results,
financial condition, and future development plans, investors should carefully read
the full text of the interim report, which is available on the website of the Shanghai
Stock Exchange (www.sse.com.cn).
1.2 The board of directors (or the “Board”), supervisory board, directors, supervisors,
and senior management of the Company guarantee the truthfulness, accuracy, and
completeness of the interim report, ensuring that there are no false records,
misleading statements, or material omissions. They also bear individual and joint
legal responsibilities.
1.3 All directors of the Company attended the board meeting for the review of this report.
1.4 This interim report is unaudited.
1.5 This report includes the profit distribution proposal or capitalization of reserves
proposal, which has been approved by the board of directors.
In the future implementation of the profit distribution plan for the first half of 2023, the total
share capital on the equity registration date will be used as the basis. An amount of RMB 70.00
(including taxes) in cash dividend will be distributed to all shareholders for every 10 shares held.
It is hereby clarified that there will be no capitalization of the profit distribution through capital
reserve conversion, nor will there be any other form of profit distribution in this instance.
The projected profit distribution amount during the reporting period is estimated to be RMB
504 million (calculated based on the total share capital of June 30, 2023). This amount accounts
for 74.60% of the net profit attributable to shareholders of the Company during the reporting
period. Since the Company's initial public offering in January 2017, the cumulative cash dividends
amount to RMB 5.298 billion (including the announced but yet-to-be-implemented dividend
amount during the reporting period), which is 5.89 times the net proceeds raised from the initial
public offering of stocks.
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Part II Basic Information of the Company
2.1 Company Profile
Stock Profile
Previous Stock
Types of Stocks Stock Exchange Stock Name Stock Code
Name
Shanghai Stock
A-shares G-bits 603444 N/A
Exchange
Contact Information Board Secretary Securities Affairs Representative
Name LIANG Lili CAI Luxi
Telephone 0592-3213580 0592-3213580
G-bits Building, No.4 Wang Hai G-bits Building, No.4 Wang Hai
Office Address
Road, Software Park II, Xiamen Road, Software Park II, Xiamen
Email ir@g-bits.com ir@g-bits.com
2.2 Key Financial Information
Unit: RMB Yuan
30 June 2023 31 December 2022 YoY+/- (%)
Total assets 6,864,634,222.72 6,490,420,298.78 5.77
Equity attributable to
shareholders of the 4,535,560,151.16 3,978,734,566.03 14.00
Company
H1 2023 H1 2022 YoY+/- (%)
Operating income 2,348,924,659.16 2,510,553,952.19 -6.44
Net profit attributable to
shareholders of the 675,971,006.54 688,329,156.45 -1.80
Company
Net profit attributable to
shareholders of the
Company after deducting 645,696,206.55 667,680,463.30 -3.29
non-recurring profits and
losses
Net cash flows from
601,649,840.64 749,913,191.08 -19.77
operating activities
Weighted average return on an increase of 0.73
15.82 15.09
equity (%) percentage points
Basic earnings per share
9.40 9.58 -1.88
(RMB/share)
Diluted earnings per share
9.39 9.58 -1.98
(RMB/share)
Description:
1. Business Overview During the Reporting Period
（1）Overview of Major Game Revenue
1）Domestic Game Business
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A. The operating revenue of Asktao (PC) during the reporting period decreased slightly
compared to the same period last year.
B. The operating revenue of Asktao (Mobile) during the reporting period decreased
compared to the same period last year.
C. The operating revenue of Overmortal (Mainland version) during the reporting period
decreased compared to the same period last year.
D. Aobi Island: Dreamland was launched in July 2022, contributing incremental operating
revenue during the reporting period compared to the same period last year.
E. The Company's cooperation with the developer of "Mole's World" expired on May 26,
2023, and the Company recognized the deferred revenue balance as operating revenue during
the reporting period, as the performance obligations are no longer required.
2）Overseas Game Business
During the reporting period, the operating revenue from overseas game business amounted
to RMB 119 million, with a year-on-year growth of 5.99%.
（2）Overview of Company Personnel
1) The total number of employees at the end of this reporting period was 1,356, an increase
of 102 employees compared to the end of the previous year with a growth rate of about 8.13%,
mainly due to the increase in the number of employees engaged in game research and
development activities.
2) The average monthly number of employees during the reporting period was
approximately 1,317, an increase of around 268 employees compared to the same period last
year with a growth rate of about 26%. Among them, the number of employees engaged in game
research and development activities and overseas operation activities increased by 167 and 33,
respectively.
The total number of employees increased year-on-year, resulting in corresponding
increases in basic compensation and related expenses. However, the accrued bonuses based
on business performance decreased year-on-year, leading to a reduction in overall employee
compensation and related expenses year-on-year.
（3）Overview of Equity Investment Business
The company's investment targets mainly consist of upstream and downstream enterprises
in the game industry or investment funds in the industry. During the reporting period, the
Company made relatively few new equity investments. The income generated from investment
activities during the reporting period (including investment income, gains or losses from changes
in fair value, assets impairment losses, etc.) increased by RMB 83 million compared to the same
period last year. This increase was primarily due to higher share of profits of joint associates
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compared to the same period last year.
（4）Overview of Exchange Rate Changes
As of June 30 2023, the central parity rate of the U.S. dollar against the RMB was 7.2258,
representing a 3.75% increase from the end of the previous year. As a portion of the Company's
business is settled in U.S. dollars and the Company holds a relatively large amount of U.S. dollars
(mainly deposited in domestic banks), the foreign exchange gains were RMB 68 million during
the reporting period, compared with RMB 104 million in the same period last year, with a
decrease of RMB 35 million.
2. Overview of Game Profits During the Reporting Period
（1）Domestic Game Business
1) For Asktao (PC), the operating revenue and profits during the reporting period decreased
slightly compared to the same period last year.
2) For Asktao (Mobile), during the reporting period, the operating revenue experienced a
decrease compared to the same period in the previous year. Furthermore, there was an increase
in product-related expenditures such as advertising costs and operational service fees. As a
result, the overall profit showed a year-on-year decrease.
3) For Overmortal (Mainland Version), during the reporting period, product-related
expenditures including advertising costs and operational service fees demonstrated a year-on-
year decrease. However, the game gross billings for the same period experienced a decline
compared to the previous year, resulting in a year-on-year reduction in business profit.
4) Aobi Island: Dreamland, launched in July 2022, contributed incremental profits during
the period compared to the same period last year.
（2）Overseas Game Business
During the reporting period, the Company launched products such as Overmortal (Vietnam
version), Dungeon Survivor III: Dark Genesis (Hong Kong, Macau and Taiwan, China version),
and Funny Fighters: Battle Royale (Southeast Asia version) in overseas markets. As of 30 June
2023, the above products have not yet turned profitable.
3. Overview of Operating Cash Flow from Operating Activities During the Reporting
Period
(1) The net cash flow generated from operating activities during the reporting period
decreased by 19.77% compared to the same period last year. The main reasons for this decrease
are as follows:
1) The year-on-year decline in core product gross billings resulted in a reduction in
operating cash inflow from sales receipts.
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2) The overall operating cash outflow remained relatively stable compared to the same
period last year, with the following factors contributing:
A. Taxes paid during the reporting period decreased compared to the same period last year.
B. Due to an increase in personnel, basic compensation expenses increased compared to
the same period last year.
(2) The year-on-year decrease in operating revenue during the reporting period, which
amounts to a decline of 6.44%, is relatively proportional to the decrease in operating cash inflow,
which declined by 6.26%. However, the operating cash outflow remained stable, leading to a
larger decrease in net cash flow from operating activities compared to the decline in operating
revenue.
4. Overview of Deferred Game Revenue
As of June 30, 2023, the Company's unamortized deferred game revenue balance amounts
to RMB 479 million, a decrease of RMB 77 million compared to the end of the previous year RMB
556 million. This decrease is primarily due to the expiration of the Company's cooperation with
the developer of Mole's World on May 26, 2023, and the Company recognized the deferred
revenue balance as operating revenue, as the performance obligations are no longer required.
2.3 Quarterly Key Financial Information
Unit: RMB Yuan
Item Q2 2023 Q1 2023 Q4 2022 Q3 2022
Operating revenue 1,204,554,622.60 1,144,370,036.56 1,337,578,117.04 1,319,483,418.94
Net profit attributable to
shareholders of the 369,418,231.91 306,552,774.63 449,146,781.15 323,398,522.08
Company
Net profit attributable to
shareholders of the
Company after deducting 365,081,137.68 280,615,068.87 465,927,278.40 334,709,485.30
non-recurring profits and
losses
Net cash flows from
356,063,608.17 245,586,232.47 459,866,468.28 542,614,303.18
operating activities
Description:
1. Changes in operating revenue and net profit attributable to shareholders of the Company
for the second quarter of this year compared to the first quarter are as follows:
(1) Profits from Game Business
1) For Asktao (PC), the operating revenue and profits for the second quarter of this year
decreased compared to the first quarter.
2) For Asktao (Mobile), the operating revenue increased for the second quarter of this year
due to the 7th-anniversary celebration event. The product-related expenses such as promotion
and operation service fee also increased. As the increase in revenue exceeded the increase in
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expenses, the overall profit showed an increase compared to the first quarter.
3) For Overmortal (Mainland version), the product-related expenses such as promotion and
operation service fee decreased for the second quarter of this year. However, the game gross
billings decreased in the same period, leading to a decrease in business profit compared to the
first quarter.
4) For Aobi Island: Dreamland, the operating revenue and profits for the second quarter of
this year decreased compared to the first quarter.
(2) Exchange Rate Change Gains
In the second quarter of this year, gains from exchange rate change amounted to RMB 94
million, with losses of RMB 25 million in the first quarter. This represents a quarter-on-quarter
increase in gains of RMB 120 million (an increase of RMB 73 million attributable to shareholders
of the Company).
2. The net cash inflow from operating activities for the second quarter of this year increased
compared to the first quarter, primarily influenced by the following factors combined:
(1) The cash inflow generated from operating activities remained relatively stable quarter-
on-quarter.
(2) The overall cash outflow from operating activities decreased quarter-on-quarter, with
the following contributing factors:
A. Annual bonuses for the year 2022 were disbursed in the first quarter of this year;
B. Tax payments made in the second quarter of this year increased quarter-on-quarter.
2.4 Table of Top 10 Shareholders
Unit: Shares
Total number of ordinary shareholders at the end of the reporting
11,695
period
Number of preferred shareholders whose voting rights had been
-
restituted during the report period
Top 10 shareholders
Number of Number of
Shareholding Number of Shares Held Shares
Nature of
Name of shareholder Percentage Shares under Pledged,
Shareholder
(%) Held Restricted/Lock Marked, or
-up Conditions Frozen
Domestic
LU Hongyan 29.72 21,412,615 None
natural person
Domestic
CHEN Tuolin 11.44 8,240,025 None
natural person
Hong Kong
Overseas
Securities Clearing 10.19 7,339,763 None
corporation
Company Ltd.
Domestic
HUANG Zhihui 1.92 1,384,782 None
natural person
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Domestic
LI Peiying 1.87 1,350,000 None
natural person
Zhongtai Securities
Asset Management -
China Merchants
Bank - Zhongtai Other 1.42 1,019,840 None
Xinghe No. 12
Collective Asset
Management Plan
Ping An Fund - Ping
An Life Insurance
Company of China,
Ltd. - Ping An Life -
Ping An Fund Equity Other 1.19 860,606 None
Entrusted
Investment No. 1
Single Asset
Management Plan
China Minsheng
Bank Co., Ltd. -
Huaxia CSI
Animation & Game
Other 1.03 744,864 None
Exchange-Traded
Open-End Index
Securities
Investment Fund
China Construction
Bank Corporation -
Zhongtai Kaiyang
Value-Optimized
Other 0.57 413,855 None
Flexible Allocation
Mixed-Type
Securities
Investment Fund
China Construction
Bank Corporation -
Fullgoal Long-Term
Other 0.54 386,030 None
Growth Mixed-Type
Securities
Investment Fund
Related or acting-in-concert parties
N/A
among the shareholders listed above
Explanation of preferred shareholders
with voting rights restored and their N/A
shareholding quantities
2.5 Number of Preferred Shareholders as of the End of the Reporting Period and Table
of Top 10 Preferred Shareholders
Applicable N/A
2.6 Changes in Controlling Shareholder or Ultimate Controlling Party
Applicable N/A
2.7 Outstanding Bond Situation as of the Approval Date of the Semi-Annual Report
Applicable N/A
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Part III Management Discussion and Analysis
3.1 Overview of Core Business During the Reporting Period
1. Business Profile
The company specializes in the development and operation of online games, with a focus
on nurturing innovative talent and promoting efficiency. Its mission is to present unique products
and enriching entertainment to a global audience.
Founded in 2004, the Company has immersed itself in the game industry. Through years
of development and technological advancement, the Company has grown significantly,
enhancing its technical capabilities and expanding its product portfolio. Rooted in traditional
Chinese culture, the Company has developed games such as Asktao (PC), Asktao (Mobile), and
Overmortal. Asktao (PC) has been in continuous operation for 17 years since its debut in 2006.
Building on its strong user base and IP popularity, the Company launched the mobile version of
the MMORPG Asktao in April 2016, which has enjoyed steady popularity for the past 7 years. In
February 2021, the Company launched Overmortal, an ink-wash style idle mobile game about
the Taoist cultivation of immortality. Since its release, it has attracted over 24 million users.
Leiting Games, a platform G-bits operates independently, has robust game management
capabilities. The Company has managed a wide range of games such as Asktao (Mobile),
Overmortal, Aobi Island: Dreamland, Dragon POW!, World Flipper, Tale of Immortal (PC),
Dungeon Survivor II: Dark Tide (Android), Dungeon Survivor III: Dark Genesis, Funny Fighters:
Battle Royale, Gumballs, and Abyss Blade, among other successful titles.
2. Business Models
The Company specializes in the development and operations of games. Below is a
breakdown of the Company’s revenue streams and operating models:
(1) Revenue Streams
For online games, the Company has three revenue streams: Pay-To-Play (PTP), Free-To-
Play (FTP), or In-Game Advertising (IGA). The majority of our revenue comes from FTP, where
players can play for free and publishers profit from in-game item sales. FTP is a popular revenue
model for the online game industry in China.
(2) Operating Models
There are three main operating models for the Company’s games: independent operation,
licensed operation, and cooperative operation.
(1) Independent Operation: The Company publishes games on its platform and handles
both publishing and promotion. These games might be developed by the Company or by other
organizations.
(2) Licensed Operation: The Company licenses games developed by itself to external
publishers, who are responsible for managing the game's publishing and promotion. The
Company’s role is limited to technical support and content development.
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(3) Cooperative Operation: The Company partners with third-party platforms, such as the
App Store and Android application stores, to co-publish and promote its games, whether
developed by the Company itself or licensed.
The Company’s mobile games mainly follow the independent operation and cooperative
operation models. For example, Asktao (PC) is licensed to GY Games, and other PC games from
the Company’s mainly follow the cooperative operation model.
3.2 Analysis of Core Competencies During the Reporting Period
1. Strong Independent Research and Development (R&D) Capabilities
(1) Overview of the Company’s R&D Performance
The Company attached great importance to R&D and talent development. During this
reporting period, The Company’s R&D expense amounted to RMB 0.37 billion, accounting for
15.74% of its revenue. This sustained investment has laid the foundation for its innovation. The
Company’s R&D team has grown year on year, with the number of employees reaching 530 in
2021, 692 in 2022, and 776 in the first half of 2023, representing 56.08%, 55.18%, and 57.23%
of the total workforce respectively. The Company’s experienced core R&D personnel, all
possessing excellent game development and management skills, are the foundation for the
Company’s ongoing product launches.
(2) Boost R&D Performance with the Minimum Viable Product (MVP) Approach
Games, as a medium of entertainment, thrive by providing users with compelling and novel
experiences. The Company’s commitment to innovation is unwavering. The Company strives to
create games that are both unique and commercially viable. By focusing on differentiation, the
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Company increases its product's competitiveness on the market while also increasing the
innovation of their gameplay, concepts, art styles, etc. This also intensifies the challenges of R&D,
requiring teams that excel in gameplay design, project management, and data analysis. Through
years of experience, the Company has adopted the MVP approach to its R&D process.
In applying the MVP approach to the Company’s R&D, at the start of a project, the Company
assembles a core team to develop a prototype based on the creative designer's idea. Extensive
user testing is then used to validate the feasibility of the core gameplay mechanics. Throughout
the development process, the game undergoes numerous iterations and is fine-tuned based on
test data. This MVP testing approach, starting from the demo version, allows the Company to
keep a tight rein on product direction, avoid wasteful investments, and control R&D costs.
frequent testing during development helps the Company to control variables between two
successive tests, allowing the Company to analyze user behavior feedback more accurately. As
a result, the Company has able to address issues that arise during development in a timely
manner, increasing R&D efficiency. As the demo evolves into a final project, the Company
continually refines and adapts the MVP approach to ensure seamless integration between
gameplay testing and art assets.
While the MVP approach is effective in controlling R&D costs, it doesn't imply smaller
projects or less overall investment. The scope of the project depends on the experience of the
core team, project management skills, technological accumulation, the nature of the project, etc.
The Company is committed to nurturing excellent game producers over the long term, and
through the MVP approach, the Company filters projects and allocates more resources in the
hope of producing more innovative, engaging, and high-quality products.
In addition, the MVP approach involves the Company’s operations team working closely
with the R&D team on a variety of tests and analyses. This allows the Company to gain a deep
understanding of the market and users of its products, so that the Company can tailor its
strategies and minimize the risks and costs of release.
(3) Middle Platform Construction, A Strong R&D Foundation
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The Company has prioritized the establishment of solid R&D middle platforms. This
includes the Company’s Technical Center, Art Department, Audio Department, and Test Center.
These pillars support every aspect of development, from R&D and art design, to soundtrack
creation and product testing. This system not only ensures development, efficiency, and high
quality output, but also optimizes the allocation of resources across projects, minimizing
redundant costs and ensuring a stable R&D process.
The Company’s Technical Center specializes in game development, focusing on both
conventional and emerging technologies. It provides strong support including performance
testing and optimization, effectively tackling technical challenges and improving R&D efficiency.
Currently, the Technical Center focuses on developing compilers and auxiliary tools for GS, while
building server frameworks and various public services rooted in GS. It's designing PKG and
development tool chain is based on the GS environment, so that it can develop universal tools
for all R&D teams and provide automated building and deployment solutions. The center
conducts in-depth research on Unity, Unreal engine, and 3D rendering technologies. The center
standardizes, modularizes, and builds frameworks for projects to provide service tailored to the
needs of different teams. As a result, The Technical Center manages to reduce both the
resources and time costs of game development, while improving R&D quality. In addition, The
Technical Center applies cutting-edge AI technologies across all stages of game development,
including planning, development, and testing, improving both the R&D efficiency and the overall
gaming experience.
The Company’s Art Department focuses on improving the quality and style of game art.
The Art Department creates unique art styles that fit the unique vibe of our games, providing a
distinctive gaming experience while satisfying diverse aesthetic preferences. Through
continuous testing and new iterations, the Art Department strikes a balance between distinctive
and mainstream art elements. In its pursuit of artistic excellence, the Art Department has
designed detailed art standards and rules for each product, while consistently improving its
design capabilities and quality control. The Art Department actively follows the latest technology
trends, and promote their application in game art, especially cutting-edge technologies such as
AIGC. By using image generation techniques and apps like Stable Diffusion, the Art Department
manages to produce illustrations and in-game icons more efficiently, reducing resource costs
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and streamlining our workflows.
The Company’s Audio Department is dedicated to creating immersive audio that integrates
with the game's narrative and gameplay. It pioneers the use of state-of-the-art audio and AI
technology to effectively create audio that enhances the gaming experience and is tailored to
player preferences.
The Company’s Test Center manages project testing for daily and version updates to
ensure that the performance is up to the standard. The center ensures a stable allocation of
testing resources, improving both the efficiency and standardization of our testing process. By
drawing on past experience, it provides reusable testing methodologies to ensure that our games
maintain a stable quality.
2. Exceptional Game Operations
(1) Proven Long-term Operational Proficiency
Leiting Games, an independently operated platform, is committed to a quality-first approach
that prioritizes the user experience. The high-quality, unique, and highly engaging games under
Leiting Games' operations have gained significant popularity and earned an excellent reputation.
With years of experience, Leiting Games has developed a comprehensive understanding
of operating various game genres including MMORPG, Roguelike, idle games, and casual
simulation. Leiting Games' operational framework covers everything, such as game version
optimization, brand development, media outreach, event planning, cooperative channels,
customer support, etc. With a keen understanding of the unique features of mobile games and
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the target market, as well as a sharp insight into player demographics, behaviors, and spending
habits, Leiting Games tailor its strategies to deliver precise and effective promotion.
(2) Precise and Effective Promotion
In recent years, "buying traffic" has become an important promotion method in the game
industry. However, its rising cost can negatively impact a game's profitability. Over the years, the
Company has consistently prioritized creating unique, high-quality products and tailoring its
promotion strategies accordingly. The Company’s promotion plans are based on the game's
features, the target market, and our understanding of the player base — their preferred platforms,
behaviors, and spending habits. This allows the Company to reach its target audience effectively
and precisely, while avoiding over-reliance on "buying traffic".
1) User Relationship Management
The Company values user relationship management as it facilitates communication
between the Company and its players. It allows the Company to meet the evolving demands of
our players by understanding their needs deeply, a strategy that benefits its relationship with the
users and enhances the Company’s reputation within the industry. With sincerity towards the
players being the core of the Compnay’s operations, game designers, promotions staff, and
customer support personnel organized numerous events for players. Some activities for users of
Asktao (Mobile) are as follow:
Since 2017, Asktao (Mobile) has held a national competition every year, attracting a huge
number of participants. The competition includes warm-ups, point-based matches, city matches
(offline), knockout stages, and finals (offline), creating an energetic and engaging environment.
The Company has also been organizing Designers Talk, an event for game designers to meet
players, in various cities since 2016. Additionally, starting in 2018, the Company has held an
annual Asktao Conference, which gives players an opportunity to engage in in-depth discussions
and participate in fun events, either online or offline.
2) Advertising
Throughout game releases, updates, and promotions, the Company’s user platforms to
advertise, send KOC (key opinion consumer) recommendations, and livestream games. At the
same time, the Company supports UGC (user-generated content) across multiple platforms to
spread the product information faster and further. The Company also focuses on user retention
with well-designed gameplay and customer service. The Company believes that improving the
user experience is the key to higher user retention and long-term product success.
During the reporting period, the Company’s games like Asktao (Mobile) and Overmortal
have run KOL (key opinion leader) promotional campaigns on short video platforms based on
the dates of major version updates and user activities. These targeted promotions ensure a
continuous flow of new users. Furthermore, the games have adopted additional promotional
plans such as the TikTok publisher program, bidding ad release, and micro-end ad release to
reach a wider range of users and increase conversion rates to keep the product consistently
popular.
3) IP Development
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The Company’s IP development aims to enrich the game's world, character portrayals, and
storylines to deepen players' immersion and emotional connection to the game.
Asktao (Mobile), a classic IP that has been in operation for 17 years, represents the
Company’s efforts to strengthen the Asktao brand. To build the brand, the Company is enhancing
game stories and player immersion through various Asktao IP derivatives, including novels,
audiobooks, merchandise, and short films. After the release of its first novel, Asktao: Dashing
Spear, the Company invited renowned author Yan Leisheng to write the sequel, Asktao: Tao in
the Heart, which was published in 2021 as a printed book and audiobook. Throughout the
process, the Company invited dozens of hardcore players to contribute ideas and read the work
in advance to ensure that the novel aligned with players' perceptions of the Asktao world.
Overmortal is a unique Taoist immortality cultivation-themed IP which is enhanced by music
recordings, comics, novels, animations, and more. In 2022, Overmortal launched its animated
derivative I'm Carl, which is updated on platforms such as TikTok, Kuaishou, and Bilibili, and
boasts nearly 2.4 million fans across all platforms. The IP related releases include the film
Ordinary Yet Extraordinary, the mini-drama Mr. White Fox, the audiobook Between Demon and
Immortal, and more, maintaining high popularity across all major platforms. In May 2023, the
game's theme song, "Beyond Mortal", was released on major music platforms. The song, a
unique blend of Chinese traditional elements, rap, and chanting, received acclaim from players
and music lovers alike.
4) Collaborations
The Company frequently collaborates with products and brands that appeal to its games'
target players to increase the Company’s popularity and recognition. The collaboration partners
can range from the Company’s games to those of other companies, as well as animated films
and web series. The Company held numerous themed collaboration events during the reporting
period that attracted a large number of participants. In particular, during the reporting period,
Overmortal ran successful collaborations with the West Lake Scenic Area Administration and the
classic IP, Shrouding the Heavens. In April 2023, Asktao (Mobile) teamed up with the China
Academy of Art, creating the "the seventh anniversary fashion" that blended traditional Chinese
colors and patterns.
5) Charts & Recommendations
The Company’s high-quality, unique, and intriguing games have earned the recognition
from leading platforms such as the App Store and TapTap. The Company is regularly featured
in its charts, attracting a significant number of downloads and earning widespread attention. In
addition, players' ratings and discussions on these platforms have further increased its games'
popularity. During the reporting period, several of the Company’s games, including Asktao
(Mobile), Overmortal, Aobi Island: Dreamland, World Flipper, Dungeon Survivor III: Dark Genesis,
and Elona, were featured on popular platforms such as the App Store.
6) Word-of-Mouth Marketing
The Company leverags its excellent product quality to drive word-of-mouth marketing
through various third-party gaming platforms, recommendations from KOCs (key opinion
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consumers), WeChat accounts, QQ groups, and its official channels. The Company’s approach
includes user selection, expectation management, feature communication, and user feedback
tracking to refine and improve its operations.
(3) Player-Centric Approach
The Company long-standing commitment to a player-centric design and operation
philosophy enables it to create and share enjoyable experiences. As part of this philosophy, the
Company encourages its producers to adopt the MVP (minimum viable product) approach. This
means prototyping and testing core gameplay as early as possible so that the Company can
incorporate player feedback to refine its games and ultimately make high-quality, original content
that its players love.
The Company invests in its customer service team through competitive salaries and
comprehensive business and technical training, ensuring they provide professional, efficient, and
satisfying service. With the philosophy of “being an official friend of players and a guide to great
experiences”, the Company provide in-depth support through various channels such as in-game
CS (customer service) button, a 24-hour hotline, WeChat account, forums, and email. The
Company maintains a dedicated team to monitor service quality daily and employs AI technology
to enhance its support capabilities, significantly improving the players’ experience.
Additionally, The Company organizes online and offline events to directly engage with its
players, facilitating open dialogue about game events and updates. For instance, for Asktao
(Mobile), the Company holds annual the Designers Talk and Asktao Conference to discuss with
players the future updates and promotion plans and collect feedback from KOLs and players to
help them "customize" their games.
3.3 Analysis of Core Competencies During the Reporting Period
1. Major Product Performance
(1) Status of Launched Products
Overview of Launched Products:
In-house
Name Genre Release Date
Developed/Licensed
Asktao (PC) In-house Developed Turn-Based MMORPG April, 2006
Asktao (Mobile) In-house Developed Turn-Based MMORPG April, 2016
Idle Taoist Immortality
Overmortal In-house Developed February, 2021
Cultivation Game
Aobi Island: Dreamland Licensed Casual Simulation July, 2022
Licensed, in Charge
World Flipper of Localization RPG with Pinball Element October, 2021
Development
Dungeon Survivor III:
Licensed Dungeon RPG October, 2021
Dark Genesis
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In-house
Name Genre Release Date
Developed/Licensed
Funny Fighters: Battle
In-house Developed Casual Competitive RPG July, 2019
Royale
Fantasy Roguelike Shooting
Dragon POW! Licensed August, 2023
Game
Please note: All the games are mobile games except Asktao (PC).
(2) Major Product Performance
1) Asktao (PC)
The Company’s first product, Asktao (PC), an online game that the Company developed
independently, was launched in April 2006 and quickly became a favorite among gamers, even
reaching a peak of nearly one million concurrent users. The game's excellence was awarded
with the Best Design for Digital Balance and the Best 2D (characters/scenes) Art Design (Art
Design) awards at the 5th annual CGDA (China Game Developers Awards). It was also
nominated as one of the Top 10 Outstanding PC Games in 2022 by CADPA (China Audio-Video
and Digital Publishing Association).
Since its release in 2006, Asktao (PC) has won players' hearts with its high-quality
gameplay and fair pricing. To prolong the game's life cycle and increase its IP value, the
Company adapts to market trends and player feedback to update the game consistently. Every
year, the Company release four major updates, the new year, annual, mid-year, and zodiac
updates, to keep the game fresh and maintain its profitability.
2) Asktao (Mobile)
In April 2016, the Company launched Asktao (Mobile), an in-house developed MMORPG.
It retains the narrative and world setting of Asktao (PC). Harnessing the loyal user base and IP
value the PC version built over the past decade, and with extensive user research, it was deeply
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optimized to adapt its core gameplay to the mobile platform. The Company also incorporates
user feedback into regular updates to ensure the game meets player expectations. To extend
the game's life cycle, the Company persistently work on enhancing the Asktao brand and its IP
value.
Due to its exceptional performance, Asktao (Mobile) has gained industry recognition, and
was chosen as the 6th game to win the China Excellent Publication Award (Audio-Visual
Electronic Game Publication) from the CADPA. It also won several other awards as well,
including Best Original Mobile Game at the 2016 Golden Plume Awards, and Best Game Music
Design at the 9th CGDA. It was voted one of the Top Ten Most Popular Original Mobile Online
Games of 2016.
During the reporting period, Asktao (Mobile) maintained an average ranking of 29th on the
App Store's bestselling game list, with a peak ranking of 10th.
3) Overmortal
Overmortal is an in-house developed, idle Taoist immortality cultivation mobile game with
a traditional Chinese ink wash art style. The game depicts a Taoist realm inhabited by humans,
immortals, monsters, and demons. It faithfully recreates the stages and mechanisms of Taoist
spiritual cultivation, as well as displaying abilities and techniques from similar novels of the genre.
Accompanied by dynamic lighting and sound effects, players will enjoy an immersive and
engaging gaming experience.
Thanks to its excellent production and operational performance, Overmortal has received
high industry recognition, winning awards such as the Best Concept Art Design award at the 12th
CGDA, the Best Creativity for Mobile Games award at the 14th CGDA, and nominations for the
Top 10 Outstanding Creative Games and Top 10 Emerging Games by the CADPA in 2021.
During the reporting period, Overmortal maintained an average ranking of 27th on the App
Store's best-selling game list, with a peak ranking of 7th.
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4) Aobi Island: Dreamland
Aobi Island: Dreamland is a casual mobile game based off an existing IP launched on July
12, 2022. The game retains many iconic elements from its web-based predecessor, while
introducing various social interaction features and integrating fashion trends such as modernized
Chinese traditional styles. Players can engage in various in-game features such as character
development, management simulation, and outfit changing. The game has been updated at a
rapid pace since its release, providing players with a fresh and varied gaming experience.
5) Dragon POW!
Launched on August 11, 2023, Dragon POW! is a top down shoot 'em up mobile game with
a unique gameplay mechanic of counterattacking by devouring bullets. Players take on the role
of a dragon knight who travels through various kingdoms with a small black dragon to retrieve
the lost treasures of the dragons. Instead of dodging enemy attacks, players can swallow
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incoming bullets to unleash powerful counterattacks, resulting in a thrilling gameplay experience.
2. Major Product Performance
Overview of Products in Development:
Status of Estimated
Products Developed Planned Regions
Game Genre Release Date
In-House for Release
Licensing
Second Half of
Equip Master (Code License Western Fantasy Idle
Worldwide 2023 (Mainland
Name: BUG) Obtained Game
China)
Hong Kong, Macao,
Not Yet First-Person Shooting First Quarter of
Outpost: Infinity Siege Taiwan, and
Applied PC Game 2024
Overseas
Second Half of
Alchemy Family (Code License Family Management
Worldwide 2023 (Mainland
Name: M66) Obtained Idle Game
China)
Project Super Meow License Customized 3D Cat First Half of
-
Star Obtained Card Game 2024
License
Fortress Battle Tower Defense SLG Worldwide TBD
Obtained
Not Yet Western Fantasy Idle 2024
Origin (Code Name) Worldwide
Applied Card Game (Overseas)
Mainland China,
Hong Kong, Macao,
Not Yet Western Fantasy Idle
M88 (Code Name) and Taiwan, as well TBD
Applied Game
as Japan and South
Korea
Mainland China,
Not Yet Idle Taoist Cultivation Hong Kong, Macao,
M72 (Code Name) TBD
Applied Simulation Taiwan, and
Southeast Asia
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Status of Estimated
Products Developed Planned Regions
Game Genre Release Date
In-House for Release
Licensing
Not Yet Western Fantasy Idle
M11 (Code Name) Worldwide TBD
Applied Game
Estimated
Licensed Products ISBN Genre Authorized Regions
Release Date
Farming Simulation August 24,
New Manor Times Owned Mainland China
Game 2023
Strategy Card
Beasts Evolved Owned Mainland China TBD
Game
Fantasy Beast
Beast Planet Not Owned Survival Strategy Overseas TBD
Game
Roguelike Mainland China, Hong
Project S (Code Name) Not Owned TBD
Simulation Game Kong, Macao, and Taiwan
Business Simulation
PicaTown Owned Mainland China 2023
Game
Mainland China, Hong
Business Simulation
Chinese Cuisine Cruise Owned Kong, Macao, Taiwan, and TBD
Game
Southeast Asia
Note: 1. The games listed above are currently in development. Whether they will be released is
not set in stone, and as such have no currently fixed release dates. If you're interested, please
stay up to date with the latest news and announcements from Leiting Games.
2. All of the above games are mobile games except Outpost: Infinity Siege, which is a PC
game. Project Super Meow Star is licensed to Qingci Games for operations.
Introductions to Products in Development:
1) Equip Master (Code Name: BUG)
Equip Master (Code Name: BUG) is a Dungeons and Dragons-themed idle game. Players
can create their own unique characters by collecting and combining various equipment. In this
world, players can enhance their abilities, explore strange environments, and build their homes.
The game also allows players to create guilds and cooperate with others, creating a glorious
world of wonders players and other players can adventure together in. Licensed in May 2023, its
mini-program version will be released in late 2023.
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2) Outpost: Infinity Siege
Outpost:Infinity Siege is a first-person shooting PC game. Players can build their outposts,
combine different weapons and ammunition, and fight within the unique terrains offered by a
variety of game modes. It's scheduled to launch on Steam in first quarter of 2024.
3) M88 (Code Name)
M88 (Code Name) is an anime-style idle MMO mobile game. Players can customize their
characters, skill sets, and classes, strategize against formidable enemies, and explore lost
legends in a world of magic. Additionally, players can build their home, and team up with other
players to build guilds and fight for an adventurous yet relaxing idle gaming experience. The
game's overseas version is expected to be released in 2024.
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4) M72 (Code Name)
M72 (Code Name) is an idle game about immortal cultivation. You start as a novice Taoist
and gradually grow into important member of your sect, engaging in amazing adventures across
three worlds. The game features 3D aerial combat, recreating the famous mid-air battles and use
of magical talismans seen in famous Chinese fantasy works. We have completed its core
gameplay design and are working on the art assets and optimizing it operational performance.
5) New Manor Times
New Manor Times is a farm simulation mobile game focusing on European manor estate
management, adapted from the 2009 web game Manor Era. The gameplay mechanics are
centered around the farming and processing of materials, as well as incorporating resource
trading systems, item collection, hunting and gathering, dungeon exploration, and an in-depth
companion system. Players can immerse themselves in an idealic lifestyle as the lords of their
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own manor. The game has obtained licensing and is expected to be released on August 24, 2023.
3. Overseas Business Overview
As the Company has been expanding its overseas operations for some time, the Company
has established systematic procedures for overseas product testing and publishing, thereby
achieving extensive coverage in most regions of the world. The Company’s MVP approach can
be easily applied in overseas markets, allowing the Company to start tests with in-game
purchases at an earlier stage than in domestic markets. This provides the Company with a rich
pool of information and data for product selection, development, and optimization.
During the first six months of 2023, our overseas division recorded a revenue of RMB 119
million, representing a year-on-year growth of 5.99%. During the reporting period, the Company
has successfully launched products such as Overmortal (Vietnamese), Dungeon Survivor III
(HK/MO/TW), and Funny Fighters: Battle Royale (Southeast Asia) in overseas markets. At the
same time, the Company’s existing games are maintaining stable operations. Furthermore, the
Company has conducted multiple tests for various in-house developed products in overseas
markets, in line with our MVP approach of rapid iterations.
The Company is also preparing to launch several new products targeted for overseas
markets, including Alchemy Family, Outpost: Infinity Siege, New Manor Times, Origin (Code
Name), and M88 (Code Name).
4. Investment Overview
While immersing itself in the game industry, the Company is not only focusing on game
development and operations, but also prioritizing investment in top-tier game studios, publishers,
and other related companies and funds within the industry.
Companies we invest in:
(1) Qingci Games Inc.
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Qingci Games, established in March 2012, specializes in online game development and
operations. It's known for The Marvelous Snail, the idle mobile game with a beautiful hand-drawn
art style, and the roguelike game Gumballs. It was listed on the Hong Kong Exchanges in
December 2021, and the Company holds an 18.55% stake in the company.
(2) TapTap
TapTap, founded in March 2016, manages the TapTap platform. G-bits holds a 9.67% stake
in the company. TapTap is a renowned third-party platform connecting game developers,
publishers, and players, allowing users to download high-quality games and share their
experiences with others.
(3) Xiamen Yongshi Technology Co., Ltd.
Xiamen Yongshi Technology Co., Ltd., established in December 2014, focuses on online
game development and production. Azure Lane, an anime-style game co-developed by the
company, has received international acclaim. G-bits holds a 20.00% stake in the company, which
is listed on the NEEQ. According to its 2023 biannual report, it generated a revenue of RMB 28
million, with a net profit of RMB 13 million.
(4) Xiamen Taojin Interactive Network Co., Ltd.
Established in June 2013, Xiamen Taojin Interactive Network Co., Ltd. focuses on online
game development and production. The company created the popular roguelike series Dungeon
Survivor, in which the Company holds a 30.00% stake. Its 2022 annual report showed a revenue
of RMB 67 million, with a net profit of RMB 40 million.
(5) Xiamen Zhenyouqu Information Technology Co., Ltd.
Xiamen Zhenyouqu Information Technology Co., Ltd., established in August 2012, mainly
develops and produces online games. G-bits holds a 10.00% stake in the company. It has
numerous popular games such as Sausage Party, Ulala: Idle Adventure, and Rapid Clash. In
particular, Sausage Party has over 200 million downloads on TapTap.
(6) Unity China
Unity China, established on November 29, 2021, is a joint venture of US-based game
engine developer Unity Technologies. G-bits holds a 1.6% stake in the company. Unity
Technologies is one of the leading companies in the industry. Apps built on Unity have been
downloaded over 5 billion times per month by the end of 2021. Moreover, over 50% of games
across mobile, PC, and console platforms are developed on Unity. Unity China is tasked with
creating localized versions of Unity's core products and managing their operations in China.
(7) PeroPeroGames
PeroPeroGames, founded in August 2017, mainly develops and produces online games.
G-bits holds a 15.00% stake in the company. Its parkour-themed music game Muse Dash
received a score of 9.2 on TapTap and has a 96% positive review rating on Steam.
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Part IV Financial Statements
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 June 2023
Prepared by: G-bits Network Technology (Xiamen) Co., Ltd.
Unit: RMB Yuan
Item 30 June 2023 31 December 2022
CURRENT ASSETS
Cash and Cash equivalents 2,379,884,538.91 2,628,619,551.17
Settlements Provision
Loans to banks and other financial institutions
Financial assets held for trading 1,212,174,622.80 629,605,938.78
Derivative financial assets
Notes receivable
Accounts receivable 258,677,260.15 264,695,831.84
Financing receivables
Prepayments 23,658,742.54 13,330,296.84
Insurance premium receivable
Due from reinsurers
Receivable reinsurance contract reserve
Other receivables 8,949,877.42 8,022,029.25
Including: Interest receivable
Dividends receivable 4,000,000.00
Financial assets purchased under agreements to resell
Inventories
Contract assets
Assets classified as held for sale
Current portion of non-current assets 7,959,252.60 20,502,738.32
Other current assets 14,294,113.51 14,078,760.20
Total current assets 3,905,598,407.93 3,578,855,146.40
NON-CURRENT ASSETS
Loans and advances
Debt investment
Other debt investments
Long-term receivables 18,058,251.69 16,707,513.05
Long-term equity investments 1,228,422,435.99 1,187,261,211.65
Other equity instruments investments
Other non-current financial assets 655,113,097.99 656,389,807.13
Investment properties 177,882,028.29 185,051,014.53
Fixed assets 621,883,954.47 639,100,053.20
Construction in progress
Productive biological assets
Oil and gas assets
Right-of-use asset 41,605,912.69 7,639,002.23
Intangible assets 70,967,728.51 72,135,456.36
Development expenditures
Goodwill 3,808,266.80 3,808,266.80
Long-term prepaid expenses 10,625,038.11 5,681,818.18
Deferred tax assets 89,369,600.25 97,185,342.58
Other non-current assets 41,299,500.00 40,605,666.67
Total non-current assets 2,959,035,814.79 2,911,565,152.38
Total assets 6,864,634,222.72 6,490,420,298.78
Current liabilities
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Item 30 June 2023 31 December 2022
Short-term borrowings
Borrowing from the central bank
Deposits and balances from banks and other financial
institutions
Financial liabilities held for trading
Derivative financial liabilities
Notes payable
Accounts payable 207,785,818.75 282,198,091.94
Receipts in advance 100,276.12 64,876.98
Contract liabilities 448,189,265.99 509,694,875.47
Financial assets sold under agreements to buy
Customer deposits and balances from banks and
other financial institutions
Customer brokerage deposits
Securities underwriting brokerage deposits
Payroll and employee benefits payable 492,737,493.81 530,906,045.00
Taxes payable 262,051,791.66 262,203,676.39
Other payables 36,108,230.31 75,527,618.02
Including: Interest payable
Dividend payable
Fees and commission payable
Payable reinsurance
Liabilities classified as held for sale
Current portion of non-current liabilities 11,284,866.59 4,148,677.00
Other current liabilities 20,252,983.36 25,882,386.82
Total current liabilities 1,478,510,726.59 1,690,626,247.62
Non-current liabilities
Insurance reserves
Long-term borrowings
Bonds payable
Including: Preference share
Perpetual debt
Lease liabilities 32,075,917.63 3,606,651.23
Long-term Payable
Long-term payroll and employee benefits payable
Provisions
Deferred income 684,231.97 684,231.97
Deferred tax liabilities 2,967,456.63 3,464,492.20
Other non-current liabilities 68,484,152.95 82,537,676.23
Total non-current liabilities 104,211,759.18 90,293,051.63
Total liabilities 1,582,722,485.77 1,780,919,299.25
Shareholders' equity:
Paid-in capital 72,041,101.00 71,866,482.00
Other equity instruments
Including: Preference share
Perpetual debt
Capital reserve 1,399,861,164.66 1,334,367,676.34
Less: treasury shares
Other comprehensive income 91,011,756.51 59,710,028.24
Special reserve
Surplus reserve 36,020,550.50 35,941,112.50
General reserve
Retained earnings 2,936,625,578.49 2,476,849,266.95
Equity attributable to shareholders of the Company 4,535,560,151.16 3,978,734,566.03
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Item 30 June 2023 31 December 2022
Non-controlling interests 746,351,585.79 730,766,433.50
Total shareholders’ equity 5,281,911,736.95 4,709,500,999.53
Total liabilities and shareholders’ equity 6,864,634,222.72 6,490,420,298.78
Legal Representative: Lu Hongyan Chief Accountant: Lin Jiajin Head of Accounting Department:
Chen Hualiang
COMPANY STATEMENT OF FINANCIAL POSITION
As at 30 June 2023
Prepared by: G-bits Network Technology (Xiamen) Co., Ltd.
Unit: RMB Yuan
Item 30 June 2023 31 December 2022
CURRENT ASSETS
Cash and Cash equivalents 253,337,165.02 316,357,502.93
Financial assets held for trading 252,400,342.50 60,342,000.00
Derivative financial assets
Notes receivable
Accounts receivable 27,486,813.86 31,868,438.63
Financing receivables
Prepayments 781,044.44 560,714.17
Other receivables 248,715,324.16 116,613,690.66
Including: Interest receivable
Dividends receivable 234,997,000.00 114,576,000.00
Inventories
Contract assets
Assets classified as held for sale
Current portion of non-current assets 2,300,588.45 4,089,865.87
Other current assets 495,619.78 177,765.77
Total current assets 785,516,898.21 530,009,978.03
NON-CURRENT ASSETS
Debt investment
Other debt investments
Long-term receivables 7,262,677.06 5,861,968.11
Long-term equity investments 2,165,018,988.14 2,128,930,582.66
Other equity instruments investments
Other non-current financial assets 145,287,238.63 148,339,140.34
Investment properties 293,945,588.47 304,655,429.83
Fixed assets 10,375,190.20 10,849,209.46
Construction in progress
Productive biological assets
Oil and gas assets
Right-of-use asset
Intangible assets 397,794.25 518,200.56
Development expenditures
Goodwill
Long-term prepaid expenses 507,604.24
Deferred tax assets
Other non-current assets
Total non-current assets 2,622,795,080.99 2,599,154,530.96
Total assets 3,408,311,979.20 3,129,164,508.99
Current liabilities
Short-term borrowings
Financial liabilities held for trading
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Item 30 June 2023 31 December 2022
Derivative financial liabilities
Notes payable
Accounts payable 4,759,431.03 7,546,577.55
Receipts in advance 40,366.55 34,710.95
Contract liabilities 22,852,026.93 28,818,229.76
Payroll and employee benefits payable 101,105,279.35 118,552,169.31
Taxes payable 29,158,123.60 47,822,500.61
Other payables 5,237,785.39 5,109,242.69
Including: Interest payable
Dividend payable
Liabilities classified as held for sale
Current portion of non-current liabilities
Other current liabilities 2,118,982.90 1,976,867.48
Total current liabilities 165,271,995.75 209,860,298.35
Non-current liabilities
Long-term borrowings
Bonds payable
Including: Preference share
Perpetual debt
Lease liabilities
Long-term payable
Long-term payroll and employee benefits payable
Provisions
Deferred income 533,731.97 533,731.97
Deferred tax liabilities 2,386,423.07 3,061,614.95
Other non-current liabilities 1,802,092.57 1,653,646.50
Total non-current liabilities 4,722,247.61 5,248,993.42
Total liabilities 169,994,243.36 215,109,291.77
SHAREHOLDERS’ EQUITY：
Paid-in capital 72,041,101.00 71,866,482.00
Other equity instruments
Including: Preference share
Perpetual debt
Capital reserve 1,208,892,386.39 1,143,391,521.98
Less: treasury shares
Other comprehensive income -24,035.06 -24,035.06
Special reserve
Surplus reserve 36,020,550.50 35,941,112.50
Retained earnings 1,921,387,733.01 1,662,880,135.80
Total shareholders’ equity 3,238,317,735.84 2,914,055,217.22
TOTAL LIABILITIES AND SHAREHOLDERS’
3,408,311,979.20 3,129,164,508.99
EQUITY
Legal Representative: Lu Hongyan Chief Accountant: Lin Jiajin Head of Accounting Department:
Chen Hualiang
CONSOLIDATED INCOME STATEMENT
For the six months ended 30 June 2023
Prepared by: G-bits Network Technology (Xiamen) Co., Ltd.
Unit: RMB Yuan
Item H1 2023 H1 2022
1. Total revenue 2,348,924,659.16 2,510,553,952.19
Including: Operating revenue 2,348,924,659.16 2,510,553,952.19
Interest income
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Item H1 2023 H1 2022
Net earned premiums
Net fee and commission revenue
2. Total cost of sales 1,372,301,755.60 1,399,534,728.61
Including: Cost of sales 269,653,185.81 252,704,356.91
Interest expenses
Fees and commission expenses
Surrenders
Net payments for insurance claims
Net provision of insurance reserve
Policyholder dividends
Reinsurance expenses
Taxes and surcharges 13,817,803.01 8,188,094.84
Selling expenses 643,496,326.15 669,586,391.87
General and administrative expenses 195,040,040.65 204,728,261.24
Research and development expenses 369,828,064.89 378,571,292.51
Financial expenses -119,533,664.91 -114,243,668.76
Including: Interest expense 651,783.12 172,743.30
Interest income 45,750,292.34 10,179,288.12
Add: Other income 36,216,535.75 27,182,794.62
Investment income/(loss) 67,632,401.01 7,590,758.94
Including: Share of profits or loss of associates and joint
58,257,678.97 -8,310,230.70
ventures
Gain from derecognition of financial assets
measured at amortized cost
Exchange gains or losses
Net exposure hedging gains/ (losses)
Gain/ (loss) on the changes in fair value 1,012,585.46 -5,570,418.04
Credit impairment losses 957,606.19 6,096,020.02
Assets impairment losses -149,355.22 -8,368,613.63
Gain/ (loss) from disposal of assets 161,357.95 -28,270.84
3. Operating profit 1,082,454,034.70 1,137,921,494.65
Add: Non-operating income 193,954.18 829,851.55
Less: Non-operating expenses 1,261,219.80 2,203,851.48
4. Profit/(loss) before tax 1,081,386,769.08 1,136,547,494.72
Less: Income tax expense 187,643,728.41 242,489,321.80
5. Net profit /(loss) 893,743,040.67 894,058,172.92
(1) Categorized by operation continuity
Net profit from continuing operations 893,743,040.67 894,058,172.92
Net profit from discontinuing operations
(2) Categorized by ownership
Net profit attributable to shareholders of the Company 675,971,006.54 688,329,156.45
Net profit attributable to non-controlling interests 217,772,034.13 205,729,016.47
6. Other comprehensive income, net of tax 32,736,567.34 40,620,784.68
(1) Other comprehensive income, net of tax, attributable to
31,301,728.27 39,108,451.33
shareholders of the Company
(i) Other comprehensive income that will not be reclassified
to profit or loss
Remeasurement gains or losses of a defined benefit plan
Other comprehensive income using the equity method that
will not be reclassified to profit or loss
Changes in fair value of other equity instrument
investments
Changes in fair value of enterprise's own credit risk
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Item H1 2023 H1 2022
(ii) Other comprehensive income to be reclassified to profit or
31,301,728.27 39,108,451.33
loss
Other comprehensive income that can be reclassified to
8,719,662.30 10,600,240.71
profit or loss in equity method
Changes in fair value of other debt investments
Amount of financial assets reclassified into other
comprehensive income
Provision for credit impairment of other debt investments
Cash flow hedging reserves (effective part of profit and loss
of cash flow hedging)
Exchange differences on translation of foreign currency
22,582,065.97 28,508,210.62
financial statements
Others
(2) Other comprehensive income, net of tax, attributable to non-
1,434,839.07 1,512,333.35
controlling interests
7. Total comprehensive income 926,479,608.01 934,678,957.60
Total comprehensive income attributable to shareholders of the
707,272,734.81 727,437,607.78
Company
Total comprehensive income attributable to non-controlling
219,206,873.20 207,241,349.82
interests
8. Earnings per share
Basic earnings per share (yuan / share) 9.40 9.58
Diluted earnings per share (yuan / share) 9.39 9.58
Legal Representative: Lu Hongyan Chief Accountant: Lin Jiajin Head of Accounting Department:
Chen Hualiang
INCOME STATEMENT OF COMPANY
For the six months ended 30 June 2023
Prepared by: G-bits Network Technology (Xiamen) Co., Ltd.
Unit: RMB Yuan
Item H1 2023 H1 2022
1. Total revenue 188,690,911.55 191,026,723.95
Less: Total cost of sales 24,331,834.66 24,411,222.82
Taxes and surcharges 2,380,122.39 1,780,037.99
Selling expenses
Administrative expenses 31,248,373.61 38,387,601.11
Research and development expenses 72,013,475.11 74,599,691.19
Finance expenses -5,433,832.03 -1,048,347.15
Including: Interest expenses (expressed with
positive value)
Interest income (expressed with positive
4,019,007.66 1,023,408.29
value)
Add: Other income 23,071,223.30 6,351,021.35
Investment income/(loss) 405,947,008.66 204,608,695.88
Including: Share of profits or loss of associates and
-414,794.00 -1,872,133.22
joint ventures
Gain from derecognition of financial assets
measured at amortized cost
Net exposure hedging gains/ (losses)
Gain/ (loss) on the changes in fair value -2,493,559.21 -1,466,191.79
Credit impairment losses 302,347.91 -34,461.10
Assets impairment losses
Gain/ (loss) from disposal of assets 419.03 -28,329.80
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Item H1 2023 H1 2022
2. Operating profit/Loss 490,978,377.50 262,327,252.53
Add: Non-operating income 5,795.58 4,741.60
Less: Non-operating expenses 255,057.24 337,888.16
3. Profit/(loss) before tax 490,729,115.84 261,994,105.97
Less: Income tax expense 16,026,823.63 13,981,614.20
4. Net profit /(loss) 474,702,292.21 248,012,491.77
(1) Net profit from continuing operations 474,702,292.21 248,012,491.77
(2) Net profit from discontinuing operations
5. Other comprehensive income, net of tax
(1) Other comprehensive income, net of tax
Other comprehensive income that will not be reclassified
to profit or loss
Other comprehensive income using the equity method
that will not be reclassified to profit or loss
Changes in fair value of other equity instrument
investments
Changes in fair value of enterprise's own credit risk
(2) Other comprehensive income to be reclassified to profit
or loss
Other comprehensive income that can be reclassified to
profit or loss in equity method
Changes in fair value of other debt investments
Amount of financial assets reclassified into other
comprehensive income
Provision for credit impairment of other debt investments
Cash flow hedging reserves (effective part of profit and
loss of cash flow hedging)
Exchange differences on translation of foreign currency
financial statements
Others
6. Total comprehensive income 474,702,292.21 248,012,491.77
7. Earnings per share
(1) Basic earnings per share (yuan / share)
(1) Diluted earnings per share (yuan / share)
Legal Representative: Lu Hongyan Chief Accountant: Lin Jiajin Head of Accounting Department:
Chen Hualiang
CONSOLIDATED STATEMENT OF CASH FLOWS
For the six months ended 30 June 2023
Prepared by: G-bits Network Technology (Xiamen) Co., Ltd.
Unit: RMB Yuan
Item H1 2023 H1 2022
1. CASH FLOWS FROM OPERATING ACTIVITIES
Cash receipts from the sale of goods and the rendering of
2,362,948,931.09 2,581,104,505.64
services
Net increase in customer bank deposits and due to banks and
other financial institutions
Net increase in loans from the central bank
Net increase in funds borrowed from other financial institutions
Cash premiums received on original insurance contracts
Net cash received from re-insurance business
Net increase in deposits and investments from insurers
Cash received from interest, fees and commission
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Item H1 2023 H1 2022
Net increase in funds deposit
Net increase in repurchase business funds
Net income from securities trading brokerage business
Tax refunds received
Cash received relating to other operating activities 96,462,452.54 42,480,945.04
Sub-total of cash inflows 2,459,411,383.63 2,623,585,450.68
Cash paid for purchase of goods and services 387,513,135.80 378,169,754.99
Net increase in loans and payments on behalf of customers
Net increase in deposits with central bank and other financial
institutions
Payments for claims for original insurance contracts
Net increase in funds lent
Cash paid for interest, fees and commission
Commissions on insurance policies paid
Cash paid to and on behalf of employee 610,711,025.42 552,059,896.75
Cash paid for taxes 268,724,511.21 447,362,595.10
Cash paid relating to other operating activities 590,812,870.56 496,080,012.76
Sub-total of cash outflows 1,857,761,542.99 1,873,672,259.60
Net cash flows from operating activities 601,649,840.64 749,913,191.08
2. CASH FLOWS FROM INVESTING ACTIVITIES
Cash received from disposal of investments 2,181,050,000.00 2,618,479,663.05
Cash received from investment income 62,707,662.00 72,724,205.80
Net proceeds from disposal of property, plant and equipment,
1,310.00 60,970.00
intangible assets and other long-term assets
Cash received from disposal of subsidiaries and other business
units
Cash received relating to other investing activities 6,841,666.67
Sub-total of cash inflows 2,243,758,972.00 2,698,106,505.52
Purchase of property, plant and equipment, intangible assets
41,046,523.24 41,557,308.85
and other non-current assets
Cash paid for investments 2,756,960,000.00 1,954,805,000.00
Net increase in secured loans
Net cash paid for acquisition of a subsidiary and other operating
units
Cash paid relating to other investing activities
Sub-total of cash outflows 2,798,006,523.24 1,996,362,308.85
Net cash flows from investing activities -554,247,551.24 701,744,196.67
3. Cash flows from financing activities
Cash received from investment 63,743,604.71 601,287.70
Including: Cash receipts from capital contributions from non-
controlling interests of subsidiaries
Proceeds from borrowings
Cash receipts relating to other financing activities
Subtotal of cash inflows 63,743,604.71 601,287.70
Repayments for debts
Cash payments for distribution of dividends or profit and interest
428,916,112.00 1,353,857,312.00
expenses
Including: Dividends or profit paid to non-controlling
204,000,000.00 204,000,000.00
shareholders of subsidiaries
Cash payments relating to other financing activities 3,607,844.95 2,398,336.27
Subtotal of cash outflows 432,523,956.95 1,356,255,648.27
Net cash flows from financing activities -368,780,352.24 -1,355,654,360.57
4. EFFECT OF EXCHANGE RATE CHANGES ON CASH AND
74,837,052.69 111,379,716.66
CASH EQUIVALENTS
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Item H1 2023 H1 2022
5. NET INCREASE IN CASH AND CASH EQUIVALENTS -246,541,010.15 207,382,743.84
Add: Cash and cash equivalents at beginning of year 2,622,640,821.07 2,900,085,934.16
6. CASH AND CASH EQUIVALENTS AT END OF THE
2,376,099,810.92 3,107,468,678.00
PERIOD
Legal Representative: Lu Hongyan Chief Accountant: Lin Jiajin Head of Accounting Department:
Chen Hualiang
COMPANY STATEMENT OF CASH FLOWS
For the six months ended 30 June 2023
Prepared by: G-bits Network Technology (Xiamen) Co., Ltd.
Unit: RMB Yuan
Item H1 2023 H1 2022
1. CASH FLOWS FROM OPERATING ACTIVITIES
Cash receipts from the sale of goods and the rendering of
176,479,019.30 180,276,252.57
services
Tax refunds received
Cash received relating to other operating activities 42,120,414.02 39,292,269.24
Sub-total of cash inflows 218,599,433.32 219,568,521.81
Cash paid for purchase of goods and services 1,563,337.97 4,297,897.13
Cash paid to and on behalf of employee 120,964,069.28 115,791,197.27
Cash paid for taxes 40,189,771.25 87,094,057.07
Cash paid relating to other operating activities 13,796,480.26 17,437,404.40
Sub-total of cash outflows 176,513,658.76 224,620,555.87
Net cash flows from operating activities 42,085,774.56 -5,052,034.06
2. CASH FLOWS FROM INVESTING ACTIVITIES
Cash received from disposal of investments 210,000,000.00 1,028,900,000.00
Cash received from investment income 286,022,510.83 898,654,434.60
Net proceeds from disposal of property, plant and equipment,
30,033.00
intangible assets and other long-term assets
Cash received from disposal of subsidiaries and other business
units
Cash received relating to other investing activities
Sub-total of cash inflows 496,022,510.83 1,927,584,467.60
Purchase of property, plant and equipment, intangible assets and
2,892,637.93 2,081,222.61
other non-current assets
Cash paid for investments 436,100,000.00 679,800,000.00
Cash Paid for disposal of subsidiaries and other business units
Cash paid relating to other investing activities
Sub-total of cash outflows 438,992,637.93 681,881,222.61
Net cash flows from investing activities 57,029,872.90 1,245,703,244.99
3.Cash flows from financing activities
Cash received from investment 63,743,604.71 601,287.70
Proceeds from borrowings
Cash receipts relating to other financing activities
Subtotal of cash inflows 63,743,604.71 601,287.70
Repayments for debts
Cash payments for distribution of dividends or profit and interest
224,916,112.00 1,149,857,312.00
expenses
Cash payments relating to other financing activities 122,760.30 656,042.06
Subtotal of cash outflows 225,038,872.30 1,150,513,354.06
Net cash flows from financing activities -161,295,267.59 -1,149,912,066.36
4. EFFECT OF EXCHANGE RATE CHANGES ON CASH AND
3,783.81 29,541.62
CASH EQUIVALENTS
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Item H1 2023 H1 2022
5. NET INCREASE IN CASH AND CASH EQUIVALENTS -62,175,836.32 90,768,686.19
Add: Cash and cash equivalents at beginning of year 312,508,715.23 296,008,023.58
6. CASH AND CASH EQUIVALENTS AT END OF THE PERIOD 250,332,878.91 386,776,709.77
Legal Representative: Lu Hongyan Chief Accountant: Lin Jiajin Head of Accounting Department:
Chen Hualiang
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CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the six months ended 30 June 2023
Prepared by: G-bits Network Technology (Xiamen) Co., Ltd.
Unit: RMB Yuan
H1 2023
Equity attributable to shareholders of the Company
Total
Item Other equity instruments Less: Other Non-controlling
Special Surplus General Retained shareholders’
Share capital preference Perpetual Capital reserve Treasury comprehensive Others Subtotal interests
Others reserve reserve reserve earnings equity
share debt Shares income
1. Balance at the end
71,866,482.00 1,334,367,676.34 59,710,028.24 35,941,112.50 2,476,849,266.95 3,978,734,566.03 730,766,433.50 4,709,500,999.53
of previous year
Changes in accounting
policies
Corrections of prior
period errors
Business combination
under common control
Others
2. Balance at the
71,866,482.00 1,334,367,676.34 59,710,028.24 35,941,112.50 2,476,849,266.95 3,978,734,566.03 730,766,433.50 4,709,500,999.53
beginning of the year
3. Increase/(decrease)
174,619.00 65,493,488.32 31,301,728.27 79,438.00 459,776,311.54 556,825,585.13 15,585,152.29 572,410,737.42
during the period
(1) Total
31,301,728.27 675,971,006.54 707,272,734.81 219,206,873.20 926,479,608.01
comprehensive income
(2) Shareholders’
contributions and 174,619.00 65,222,087.90 65,396,706.90 278,776.51 65,675,483.41
reduction
(i) Shareholders
‘contributions in 174,619.00 63,568,985.71 63,743,604.71 63,743,604.71
ordinary share
(ii) Other equity
instruments
contributions
(iii) Amount of share-
based payments 1,653,102.19 1,653,102.19 278,776.51 1,931,878.70
recognized in equity
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H1 2023
Equity attributable to shareholders of the Company
Total
Item Other equity instruments Less: Other Non-controlling
Special Surplus General Retained shareholders’
Share capital preference Perpetual Capital reserve Treasury comprehensive Others Subtotal interests
Others reserve reserve reserve earnings equity
share debt Shares income
(iv) Others
(3). Profit distribution 79,438.00 -216,194,695.00 -216,115,257.00 -204,000,000.00 -420,115,257.00
(i) Transfer to surplus
79,438.00 -79,438.00
reserve
(ii) Transfer to general
Reserve
(iii) Distribution to
-216,115,257.00 -216,115,257.00 -204,000,000.00 -420,115,257.00
shareholders
(iv) Others
(4) Transfer within
equity
(i) Capital reserves
converted to share
capital
(ii) Surplus reserves
converted to share
capital
(iii) Loss made up by
surplus reserves
(iv) Changes in the
defined benefit plan
transferred to retained
earnings
(v) Other
comprehensive income
transferred to retained
earnings
(vi) Others
(5). Special reserve
(i). Additions
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H1 2023
Equity attributable to shareholders of the Company
Total
Item Other equity instruments Less: Other Non-controlling
Special Surplus General Retained shareholders’
Share capital preference Perpetual Capital reserve Treasury comprehensive Others Subtotal interests
Others reserve reserve reserve earnings equity
share debt Shares income
(ii). Utilisation
(6) Others 271,400.42 271,400.42 99,502.59 370,903.00
4. Balance at the end
72,041,101.00 1,399,861,164.66 91,011,756.51 36,020,550.50 2,936,625,578.49 4,535,560,151.16 746,351,585.79 5,281,911,736.95
of the period
H1 2022
Equity attributable to shareholders of the Company
Item Other equity instruments Less: Other Non-controlling Total shareholders’
Special Surplus General
Share capital preference Perpetual Capital reserve Treasury comprehensive Retained earnings Others Subtotal interests equity
Others reserve reserve reserve
share debt Shares income
1. Balance at the end
71,864,752.00 1,314,418,710.72 -14,049,938.94 35,941,112.50 3,171,962,867.27 4,580,137,503.55 479,481,724.36 5,059,619,227.91
of previous year
Changes in accounting
policies
Corrections of prior
period errors
Business combination
under common control
Others
2. Balance at the
71,864,752.00 1,314,418,710.72 -14,049,938.94 35,941,112.50 3,171,962,867.27 4,580,137,503.55 479,481,724.36 5,059,619,227.91
beginning of the year
3. Increase/(decrease)
1,530.00 11,888,470.95 39,108,451.33 -461,528,155.55 -410,529,703.27 3,898,105.86 -406,631,597.41
during the period
(1) Total
39,108,451.33 688,329,156.45 727,437,607.78 207,241,349.82 934,678,957.60
comprehensive income
(2) Shareholders’
contributions and 1,530.00 4,303,384.55 4,304,914.55 590,145.07 4,895,059.62
reduction
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H1 2022
Equity attributable to shareholders of the Company
Item Other equity instruments Less: Other Non-controlling Total shareholders’
Special Surplus General
Share capital preference Perpetual Capital reserve Treasury comprehensive Retained earnings Others Subtotal interests equity
Others reserve reserve reserve
share debt Shares income
(i) Shareholders
‘contributions in 1,530.00 599,757.70 601,287.70 601,287.70
ordinary share
(ii) Other equity
instruments
contributions
(iii) Amount of share-
based payments 3,703,626.85 3,703,626.85 590,145.07 4,293,771.92
recognized in equity
(iv) Others
(3). Profit distribution -1,149,857,312.00 -1,149,857,312.00 -204,000,000.00 -1,353,857,312.00
(i) Transfer to surplus
reserve
(ii) Transfer to general
Reserve
(iii) Distribution to
-1,149,857,312.00 -1,149,857,312.00 -204,000,000.00 -1,353,857,312.00
shareholders
(iv) Others
(4) Transfer within
equity
(i) Capital reserves
converted to share
capital
(ii) Surplus reserves
converted to share
capital
(iii) Loss made up by
surplus reserves
(iv) Changes in the
defined benefit plan
transferred to retained
earnings
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E
H1 2022
Equity attributable to shareholders of the Company
Item Other equity instruments Less: Other Non-controlling Total shareholders’
Special Surplus General
Share capital preference Perpetual Capital reserve Treasury comprehensive Retained earnings Others Subtotal interests equity
Others reserve reserve reserve
share debt Shares income
(v) Other
comprehensive income
transferred to retained
earnings
(vi) Others
(5). Special reserve
(i). Additions
(ii). Utilisation
(6) Others 7,585,086.40 7,585,086.40 66,610.97 7,651,697.37
4. Balance at the end
71,866,282.00 1,326,307,181.67 25,058,512.39 35,941,112.50 2,710,434,711.72 4,169,607,800.28 483,379,830.22 4,652,987,630.50
of the period
Legal Representative: Lu Hongyan Chief Accountant: Lin Jiajin Head of Accounting Department: Chen
Hualiang
COMPANY STATEMENT OF CHANGES IN EQUITY
For the six months ended 30 June 2023
Prepared by: G-bits Network Technology (Xiamen) Co., Ltd.
Unit: RMB Yuan
H1 2023
Other equity instruments Less: Other
Item Special Surplus Retained Total shareholders’
Share capital preference Perpetual Capital reserve Treasury comprehensive
Others reserve reserve earnings equity
share debt Shares income
1. Balance at the end of previous year 71,866,482.00 1,143,391,521.98 -24,035.06 35,941,112.50 1,662,880,135.80 2,914,055,217.22
Changes in accounting policies
Corrections of prior period errors
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H1 2023
Other equity instruments Less: Other
Item Special Surplus Retained Total shareholders’
Share capital preference Perpetual Capital reserve Treasury comprehensive
Others reserve reserve earnings equity
share debt Shares income
Others
2. Balance at the beginning of the year 71,866,482.00 1,143,391,521.98 -24,035.06 35,941,112.50 1,662,880,135.80 2,914,055,217.22
3. Increase/(decrease) during the period 174,619.00 65,500,864.41 79,438.00 258,507,597.21 324,262,518.62
(1) Total comprehensive income 474,702,292.21 474,702,292.21
(2) Shareholders’ contributions and reduction 174,619.00 65,500,864.41 65,675,483.41
(i)Shareholders’ contributions in ordinary share 174,619.00 63,568,985.71 63,743,604.71
(ii)Other equity instruments contributions
(iii) Amount of share-based payments recognized in equity 1,931,878.70 1,931,878.70
(iv) Others
(3). Profit distribution 79,438.00 -216,194,695.00 -216,115,257.00
(i) Transfer to surplus reserve 79,438.00 -79,438.00
(ii) Distribution to shareholders -216,115,257.00 -216,115,257.00
(iii) Others
(4) Transfer within equity
(i) Capital reserves converted to share capital
(ii) Surplus reserves converted to share capital
(iii) Loss made up by surplus reserves
(iv) Changes in the defined benefit plan transferred to retained
earnings
(v) Other comprehensive income transferred to retained earnings
(vi) Others
(5). Special reserve
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E
H1 2023
Other equity instruments Less: Other
Item Special Surplus Retained Total shareholders’
Share capital preference Perpetual Capital reserve Treasury comprehensive
Others reserve reserve earnings equity
share debt Shares income
(i). Additions
(ii). Utilisation
(6) Others
4. Balance at the end of the period 72,041,101.00 1,208,892,386.39 -24,035.06 36,020,550.50 1,921,387,733.01 3,238,317,735.84
H1 2022
Other equity instruments Less: Other
Item Special Surplus Total shareholders’
Share capital preference Perpetual Capital reserve Treasury comprehensive Retained earnings
Others reserve reserve equity
share debt Shares income
1. Balance at the end of previous year 71,864,752.00 1,134,650,612.13 -24,035.06 35,941,112.50 2,607,757,021.13 3,850,189,462.70
Changes in accounting policies
Corrections of prior period errors
Others
2. Balance at the beginning of the year 71,864,752.00 1,134,650,612.13 -24,035.06 35,941,112.50 2,607,757,021.13 3,850,189,462.70
3. Increase/(decrease) during the period 1,530.00 4,893,529.62 -901,844,820.23 -896,949,760.61
(1) Total comprehensive income 248,012,491.77 248,012,491.77
(2) Shareholders’ contributions and reduction 1,530.00 4,893,529.62 4,895,059.62
(i)Shareholders’ contributions in ordinary share 1,530.00 599,757.70 601,287.70
(ii)Other equity instruments contributions
(iii) Amount of share-based payments recognized in equity 4,293,771.92 4,293,771.92
(iv) Others
(3). Profit distribution -1,149,857,312.00 -1,149,857,312.00
(i) Transfer to surplus reserve
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H1 2022
Other equity instruments Less: Other
Item Special Surplus Total shareholders’
Share capital preference Perpetual Capital reserve Treasury comprehensive Retained earnings
Others reserve reserve equity
share debt Shares income
(ii) Distribution to shareholders -1,149,857,312.00 -1,149,857,312.00
(iii) Others
(4) Transfer within equity
(i) Capital reserves converted to share capital
(ii) Surplus reserves converted to share capital
(iii) Loss made up by surplus reserves
(iv) Changes in the defined benefit plan transferred to retained
earnings
(v) Other comprehensive income transferred to retained earnings
(vi) Others
(5). Special reserve
(i). Additions
(ii). Utilisation
(6) Others
4. Balance at the end of the period 71,866,282.00 1,139,544,141.75 -24,035.06 35,941,112.50 1,705,912,200.90 2,953,239,702.09
Legal Representative: Lu Hongyan Chief Accountant: Lin Jiajin Head of Accounting Department: Chen
Hualiang
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