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Perfect World (002624) 2019 Interim Report Performance Review: Mobile Games Drive Profits and Enhance Boutique Strategic Performance Growth

Perfect World (002624) 2019 Interim Report Performance Review: Mobile Games Drive Profits and Enhance Boutique Strategic Performance Growth

Incident Description The company released its 2019 Interim Report on August 10, which stated that the company achieved operating income of 36.

56 trillion, a reduction of 0 a year.

29%; net profit attributable to shareholders of listed companies10.

20 ppm, an increase of 30 in ten years.


  Event comment: Gross profit margin increased significantly, Q2 performance continued to grow.

  1) The company achieved operating income in Q2 201916.

150,000 yuan, YOY-13.

39%, QOQ-20.

92%; realized net profit attributable to mother 5.

3.4 billion, a year-on-year increase of 26.

70%, QOQ9.


  2) Due to the completion of the cinema line transfer in 18H2, the report of the consolidated cinema line income no longer separates the consolidated statements, resulting in the replacement of the company’s revenue receipts. After excluding this effect, the company’s H1 revenue increased and increased.


  3) Benefiting from the gross profit growth of the mobile game business and the elimination of low-margin cinema business, the consolidated gross profit margin of the combined company is reported to be 68.

58%, a year-on-year increase of 9%; the gross profit margin of the mobile game business was 17.

27% year-on-year.


Since the company’s new online game in 19H1 uses an authorized third-party operating model, the initial and split funds are included in the revenue, and the cost has been reduced, resulting in a significant increase in the company’s mobile game gross margin and driving profit growth.

  4) Report, company sales, management, R & D, and financial expense ratios are 9 respectively.

42%, 8.

59%, 19.

48%, 2.

43%, a year-on-year 2.

75% /-0.

22% / 1.

63% / 0.

36%; among them, the company’s multiple products under development led to continuous increase in research and development costs; Xinyou’s on-line use of third-party operations resulted in the company’s sales expenses increasing.

  Both IP and R & D are equal, and the gaming sector is picking up.

  1) Reported revenues from leading companies in the gaming sector28.

780,000 yuan, 8 year on year.

06%, revenue accounted for 78.

50%, year on year 6.

27%, gross profit margin 73.

51%, a year-on-year increase of 5.


  2) Mobile games are the main driver of the company’s game sector growth, achieving revenue16.890,000 39 yuan per year.

42%, revenue accounted for 46.

twenty one%.

The reported company launched the new tour “Perfect World” “Four Seasons Songs in Cloud Dreams”. The former ranked third in the revenue of 19H1 mobile games, and the first in revenue of new games (Gamma data); the new tour “The Condor Heroes 2” has been released inIn the public beta in July, “Dream Collection Cygnus” and “My Origin” have been issued with version numbers. The company’s mobile game reserve projects also include “Magic Tower”, “New Demon Land”, “Xiao Xiao Ao Jiang Hu”, “Dream New Fairy””Remains of War” and so on.

  3)公司端游业务继续推进PC+主机双平台及中国Steam 落地,收入贡献来自经典老游《诛仙》等,主机游戏推出《非常英雄》、7 月上线的《DON’T EVEN THINK》  及近期将On-line terminal + main “Remains: Ashes Rebirth”, etc .; changes to the end game “New World of Fairy Tale”, host “Perfect World” and the main + dual-platform “Torch Front” “Magic Ascension” and other products are under development and importedDuanyou “Flame of the Flood”, “Noodle Man”, “The Pardoner” and other edition numbers.

  4) In terms of e-sports, the company has introduced world-class e-sports products such as “DOTA2” and assisted Valve in hosting Shanghai’s “DOTA2” TI9 in August.

  5) The existing company’s layout in terms of product type, gameplay, substitution and other aspects is perfect, and gradually promote the establishment of product advantages in various fields relying on high-quality IP adaptation and integrated research and development strength; through the development of international market products, build overseas mobile game distribution teamsAnd other ways to speed up going to sea.

  High-quality products show strength, and film and television revenue grows rapidly.

  1) Report the leading company’s film and television segment to achieve revenue7.

79 trillion, excluding the revenue of the cinema line to affect YOY32.

25%; income 南京夜网 from TV drama business7.

3 billion, up 56.

14%, gross profit margin 56.

06% year-on-year.


2) 19H1’s “Little Girl Flowers Never Give Up”, “Youth Fight”, “While We Are Young”, “Dream of Love”, “God Dog Seven” Season Three, “July and Ansheng”, etc.The strategy, “Shanyue knows nothing about the heart”, “Old Tavern”, “Heshan”, “New Year After Year” and “Baihai Danxin” and other episodes have been selected to celebrate the 70th anniversary of the founding of the People’s Republic of China.One after another on the line.

  Investment suggestion: Continue to be optimistic about the company’s implementation of the boutique strategy.

The company completed its early repurchase program in July with incremental repurchase 1.

68% of total share capital, trading price 19.


97 yuan, the amount of 5.

500 million; In August, it announced the plan to repurchase the company’s shares to allocate equity incentives or employee shareholding plans at no more than 36 yuan / share, totaling 300 million to 600 million, showing the company’s development confidence.

Considering the changes in share capital, the company is expected to EPS 1 in 2019-21.



08, corresponding to 24 on August 9.

24 yuan, PE 15/13/12 in 19-21, maintain BUY rating.

  Existing risks: Uncertain policy changes, uncertain project and product progress, and less-than-expected game flow.