Magic Eden Presents Magic Eden Video games, Main Hub for Web3 Video games

Dr. Dejian Liu , Chairman of NetDragon, commented: “In 2022, we delivered a resilient efficiency with 11.8% income progress in a yr of each alternatives and challenges. Our training enterprise achieved record-high income of RMB4.3 billion with 34.2% YoY progress, as we continued to construct on our international market management place with our dedication to offering educators the flexibility to rework studying and collaboration. In June 2022 , we launched our all-new ActivPanel 9 that ship essentially the most sturdy, seamless and secured person expertise but for lecturers and college students. In the course of the yr, we additionally took steps to develop our strategic partnerships and M&A initiatives to faucet into concrete software program monetization alternatives that may unleash the worth of our international channel attain, in addition to our largest put in base within the abroad market.”

“We’re additionally excited to have introduced that in June 2022 , we entered right into a strategic partnership with Merlyn Thoughts, a frontrunner in training AI expertise. We’re presently constructing on this partnership to develop a synthetic intelligence enabled interactive panel for lecture rooms, which we plan on launching in our subsequent panel launch. We imagine this can be a one-of-a-kind product that may elevate our aggressive place to a brand new degree.”

“The gaming trade in China went via unprecedented challenges all through 2022 on account of a slowdown of the home economic system as a result of Covid-19 influence. Nonetheless, a clearly outlined go-to-market technique and our distinctive gaming IP portfolio helped us to climate the storm. Though income of the gaming phase decreased by 5.8% YoY, such income efficiency outperformed the market ^[1] as we remained laser deal with execution with operational excellence. Our abroad video games continued to ship distinctive efficiency with a YoY abroad income progress of 6.5%. We additionally considerably strengthened our R&D functionality by including over 300 R&D headcounts through the yr, therefore placing ourselves in a a lot stronger place to develop our pipeline of recent video games.”

“Final however not least, we continued to place shareholders’ capital return as a excessive precedence. We’re happy to announce that the Board has authorised our remaining dividend proposal of HK$0.40 per strange share. Complete dividends for the yr (together with particular interim dividend declared in August 2022 ) amounted to HKD1.30 per strange share, representing roughly 73.0% of the overall revenue attributable to the house owners for the yr.”

Fiscal 12 months 2022 Monetary Highlights

• Income was RMB7.9 billion , representing an 11.8% enhance YoY.
• Income from the gaming enterprise was RMB3.4 billion , representing 43.6% of the Firm’s whole income and a 5.8% lower YoY.
• Income from the training enterprise was RMB4.3 billion , representing 55.1% of the Firm’s whole income and a 34.2% enhance YoY.
• Gross revenue was RMB4.3 billion , representing a 4.6% lower YoY.
• Core segmental revenue ^[2] from the gaming enterprise was RMB1.8 billion , representing a 14.1% lower YoY.
• Core segmental loss ^[2] from the training enterprise was RMB299 million , representing a 27.4% enchancment YoY.
• EBITDA was RMB1.5 billion , representing a 20.7% lower YoY.
• Working revenue was RMB1.2 billion , representing a 17.0% lower YoY.
• Non-GAAP working revenue ^[3] was RMB1.3 billion , representing a 12.7% lower YoY.
• Revenue attributable to house owners of the Firm was RMB834 million , representing a 21.5% lower YoY.
• Non-GAAP revenue attributable to house owners of the Firm ^[3] was RMB1.3 billion , representing a 2.2% lower YoY.
• Working cashflow was RMB1.1 billion , representing a 4.2% enhance YoY.
• The Firm declared a remaining dividend of HKD0.40 per strange share (2021: HKD0.40 per strange share), topic to approval on the coming annual common assembly.

Segmental Monetary Highlights

Schooling Enterprise

Income from training enterprise reached a report excessive of RMB 4.3 billion , representing a YoY enhance of 34.2%, and accounting for roughly 55.1% of whole income. Our flagship edtech subsidiary Promethean continued to outperform the market ^[5] and keep its international ex- China #1 market management place ^[6] when it comes to cargo quantity. Complete shipments of interactive flat panels reached a record-high of over 253,000 items, a YoY enhance of 37.5%, as we delivered robust efficiency throughout all main markets, rating #1 in market share in 9 of our high ten markets, together with the U.S., the U.Ok., Italy and Australia . Along with increasing penetration of its {hardware} put in base, Promethean continues to leverage its distinctive place of being the classroom edtech hub by stepping up efforts in pursuing strategic partnership and M&A alternatives with an purpose to faucet into concrete software program monetization alternatives. The Firm introduced in December the acquisition of Clarify The whole lot, a number one digital whiteboard platform for creating partaking classes, actions, and interactive shows. By way of this strategic acquisition, Promethean is predicted so as to add to its product portfolio a revenue-generating software device that addresses probably the most frequent use circumstances of its clients. This acquisition will even help the event of recent and higher options that may tackle instructing, studying, and collaboration wants.

Our gross margin was impacted by numerous geopolitical and macro challenges through the yr, extra particularly with respect to tariffs and a decrease GBP and Euro relative to USD. On an ex-tariff and forex-neutral foundation, Promethean achieved an adjusted gross margin of 30.3%, which is a 2.4 ppt discount from 32.7% in 2021 that’s largely attributable to the promote down of our present ActivPanel 7 stock for the reason that launch of ActivPanel 9 in June, and a barely larger unit materials price for ActivPanel 9 relative to the older mannequin. It must also be famous that the brand new ActivPanel 9 had an Common Promoting Value (ASP) that was 17.0% larger than the ASP of the prevailing ActivPanel 7 through the yr, due to its positioning as a next-generation product that features new options with enhanced simplicity, connectivity, safety, adaptability and longevity.

We’re additionally actively increasing our nation mannequin with a pipeline of nations in rising markets. In Egypt , the Firm secured an order of 94,000 Promethean panels from the Ministry of Schooling within the first quarter of 2022. In Thailand , the Firm’s paid pilot program entered its second part with an expectation to enter business rollout later this yr. In China , the Firm continued to construct on its partnership with the Nationwide Heart for Schooling Expertise, a unit immediately below the Ministry of Schooling, in constructing and offering technical help for the Nationwide Ok-12 Sensible Schooling Platform for main and secondary faculties. Such platform was launched in March 2022 with an enormous success, amassing over 77 million registered customers and 23 billion web page views as of March 23, 2023 . The month-to-month lively customers surpassed 10 million for each month after the launch.

We continued to boost the price construction of the training enterprise through the yr. Total core segmental lack of the enterprise for the yr narrowed by 27.4% YoY to RMB299 million . Working bills as a share of income decreased by 11.3 ppts YoY, pushed by efficient price management initiatives that will even result in larger working leverage going ahead. Moreover, regardless of 11.0% YoY discount in full yr R&D expense, the Firm managed to step up its R&D effort within the second half of the yr with an purpose to develop its choices into a number of new merchandise due for launch in 2023, designed to broaden its penetration of the market and to deliver person expertise to a brand new degree.

In 2022, market penetration of interactive flat panels reached a brand new excessive of 21% ^[7] of worldwide K12 lecture rooms, which in our view represents a vital scale that may allow future scaling of value-added subscription/SaaS-based functions. Wanting ahead, we imagine that we’re well-positioned to seize this future income stream, due to our market management in interactive flat panels and our put in base of 1.9 million lecture rooms. To that finish, we introduced in June 2022 that Promethean has entered in a strategic partnership with Merlyn Thoughts, the chief in training AI expertise with classroom functions. We’re presently constructing on this partnership to develop a synthetic intelligence enabled interactive panel for lecture rooms, which we plan on launching in our subsequent panel launch. We imagine the product can be one-of-a-kind product that won’t solely strengthen our aggressive place in classroom expertise, but additionally put us able to turn into a class dominant chief in a brand new product class.

Gaming Enterprise

A slowdown of the home economic system in China as a result of Covid-19 influence has resulted in a income YoY lower of 5.8% to RMB3.4 billion in 2022 for our gaming enterprise. Cellular gaming income remained regular at RMB577 million , representing a modest lower of 0.2% YoY, outperforming a home cell recreation market decline of 14.4% ^[8] YoY in 2022. Eudemons Pocket Model continued to ship robust efficiency and achieved record-high gross billings, representing a YoY progress of 6.2%, largely a results of the change to a ROI-driven person acquisition technique, in addition to efficient content material and gameplay updates all year long. Our cell gaming portfolio below the Eudemons IP on a mixed foundation achieved a gentle income progress of three.6% YoY.  In the meantime, PC gaming income was RMB2.8 billion , representing a 6.9% YoY lower as we noticed short-term influence from Covid-related financial slowdown on spending of our core gamers through the yr within the home market. Regardless of the challenges, we stepped up our effort in making enhancements to the in-game spending mechanisms for our flagship recreation Eudemons On-line to optimize our payers’ base, leading to a 28.4% YoY enhance in APA for this recreation. Enhanced playability on the cell platform additionally considerably drove person engagement and stickiness, main to extend of DAU and ACU of Eudemons On-line cross-platform model by 26.1% and 36.4% YoY, respectively.

Our abroad gaming enterprise continued to ship robust efficiency with income of RMB540 million , a YoY enhance of 6.5%, a progress charge that outperformed the market ^[9] . Abroad gaming income as a share of whole gaming income additionally elevated consecutively for five years to fifteen.7% in 2022. Our Conquer IP was the principle driver for the expansion in 2022 with 48.5% abroad income enhance YoY to RMB188 million , with the expansion primarily pushed by stable execution together with easing pandemic controls and market restoration within the Center East . In the meantime, we continued to duplicate our profitable enterprise mannequin in Egypt to new markets together with Saudi Arabia , Kuwait , Morocco , the Philippines , the U.S. and Canada . New language variations have been launched in Filipino, Turkish and Russian through the yr. We additionally continued to make progress in increasing the abroad market presence of our Heroes Advanced IP. In July, the Firm launched the Vietnamese pocket model below the Heroes Advanced IP, labelled Mortgage Chien Cellular , hailed by native gaming media as the brand new large of Vietnamese e-sports. In August, the Firm signed an unique licensing settlement with a famend international writer for AAA video games to co-launch Underneath Oath in main worldwide markets beginning in Japan in 2023. Neopets: Faerie’s Hope , the Firm’s first match-three recreation, was launched within the U.S., Canada , the U.Ok., Germany and France in December 2022 , which noticed its next-day retention charge and three-day retention charge within the high 5-10% of titles in the identical style. Our flagship metaverse Internet 3.0 recreation Neopets Metaverse additionally hit one other main milestone in January 2023 by finishing a US$4 million financing spherical with participation from trade leaders together with Polygon Ventures, Blizzard Avalanche Ecosystem Fund, Hashkey Capital and IDG Capital. Neopets Metaverse is predicted to launch its preliminary metaverse providing (IMO) later this yr.

Our plan in 2023 can be to considerably develop our pipeline of recent video games, along side driving income progress for our present video games. Throughout 2022, we stepped up our funding in R&D to place ourselves in a stronger place to capitalize available on the market rebound anticipated for 2023, as we noticed our gaming R&D expense elevated by 16.7% YoY to RMB768 million , accounting for 22.4% of gaming income. Our R&D headcounts elevated by over 300 in 2022, therefore considerably strengthening our growth competencies and leading to a rise of each the standard and amount of our pipeline of recent video games. We expect a complete of 5 new video games below the Eudemons IP to be launched in 2023 and 2024, the primary of which is Eudemons Cellular II , which was efficiently launched in March 2023 . We even have new video games within the pipeline below our Underneath Oath and Heroes Advanced IP, in addition to new IPs to be introduced.  Final however not least, we count on to actively discover acquisition alternatives with a purpose to additional develop our market attain and core competencies.

Administration Convention Name and Webcast

NetDragon’s administration crew will maintain a convention name and webcast at 10:00 am Hong Kong time on March 28, 2023 (or 10:00 pm, Jap Time on March 27, 2023 ) to debate the outcomes and up to date enterprise developments.

Particulars of the reside convention name are as follows:

A reside and archived webcast of the convention name can be out there on the Investor Relations part of NetDragon’s web site at http://ir.nd.com.cn/en/class/webcast . Members ought to go to the web site 10 minutes previous to the decision, then click on on the icon titled “2022 Annual Outcomes Convention Name and Webcast” and comply with the registration directions.

About NetDragon Websoft Holdings Restricted

NetDragon Websoft Holdings Restricted (HKSE: 0777) is a world chief in constructing web communities, with an extended observe report of growing and scaling a number of web and cell platforms that influence tons of of thousands and thousands of customers, together with earlier institutions of China’s first on-line gaming portal, 17173.com, and China’s most influential smartphone app retailer platform, 91 Wi-fi.

Established in 1999, NetDragon is without doubt one of the most respected and well-known on-line recreation builders in China with a historical past of profitable recreation titles, together with Eudemons On-line , Heroes Advanced, Conquer On-line and Underneath Oath . Lately, NetDragon has additionally began to scale its on-line training enterprise on the again of administration’s imaginative and prescient to create the most important international on-line studying neighborhood, and to deliver true built-in blended studying options to each college world wide.

For investor enquiries, please contact:

NetDragon Websoft Holdings Restricted

Maggie Zhou
Senior Director of Investor Relations
Tel：+852 2850 7266 / +86 591 8390 2825
E mail： maggiezhou@nd.com.cn
Web site： ir.netdragon.com

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SOURCE NetDragon Websoft Holdings Restricted