Huayi Brothers '2016 net profit performance was stable, the industrial investment sector performed well

Although Huayi Brothers 'performance suffered its first decline in eight years since its listing due to the unfavorable overall market environment and poor performance of the film business, its net profit still ranks first among listed film and television entertainment companies thanks to the outstanding performance of the industrial investment sector.

Original title: Huayi Brothers 'performance declined in 2016, the film business's "small year" investment sector made efforts.

On March 27, Huayi Brothers released its 2016 annual report. During the reporting period, the company achieved total operating income of 3.503 billion yuan, attributable to shareholders of listed companies. Net profit was 808 million yuan, a decrease of 17.21% from the same period last year. Although Huayi Brothers 'performance suffered its first decline in eight years since its listing due to the unfavorable overall market environment and poor performance of the film business, its net profit still ranks first among listed film and television entertainment companies thanks to the outstanding performance of the industrial investment sector.

Wang Zhonglei, vice chairman and CEO of Huayi Brothers, once said in an open letter to employees at the end of 2016:"This year, both the box office and market share have significantly declined." Affected by the lower-than-expected performance of the film business, the overall performance of Huayi Brothers 'film and television entertainment sector fell year-on-year. Data shows that in 2016, Huayi Brothers achieved a total global box office of approximately 6.5 billion yuan, including a total domestic box office of 3.1 billion yuan. In 2017, Huayi Brothers will continue to increase its investment in the content field. Wang Zhonglei, vice chairman and CEO of Huayi Brothers, has publicly stated on many occasions that 2017 will be Huayi Brothers 'production year: "Fanghua" directed by Feng Xiaogang has been announced to be released on the National Day of 2017, and the crime action film "The Detonator" launched at the end of last year is also under intense production. The action drama "Battle against England" co-starred by Jackie Chan and Brosnan, who plays 007, will also be released simultaneously around the world during the National Day period. Many film works such as "Eight Hundred" directed by Guan Hu,"The Four Great Kings of Di Renjie" directed by Tsui Hark, and "Previous Raiders 3" directed by Tian Yusheng will also be launched one after another. Huayi Brothers 'finishing touch animation will also launch its first live-action animated film.

In addition to always adhering to its core position in content production, Huayi Brothers has also begun to realize their lack of voice in the terminal screening market after experiencing the pain of many films being praised but not being popular. In the second half of 2016, Huayi Brothers began to deliberately strengthen the layout of the theater line. According to the announcement, as of the end of the reporting period, Huayi Brothers had 19 theaters completed and put into operation, of which 4 new theaters were opened during the reporting period, including Huayi Brothers Film Collection, a high-end customized theater brand. At the beginning of 2017, Huayi Brothers, through its wholly-owned subsidiary Huayi Brothers Mutual Entertainment (Tianjin) Investment Co., Ltd., participated in the fixed increase of Dadi Cinema with a price of 78.85 million yuan and subscribed for 950,000 shares, further demonstrating its determination to increase the layout of the cinema. Wang Zhonglei said in an interview during the same period: In 2017, Huayi Brothers will accelerate the layout of theaters and plan to rank among the forefront of the theater industry within five years; but we will not blindly pursue quantity and scale, but rely more on quality. Only quality theaters are more competitive.

In sync with the theater layout, Huayi Brothers has also begun to strengthen its distribution capabilities step by step. According to the announcement, Huayi Brothers (Beijing) Film Distribution Co., Ltd. was officially established in 2016. This is the first time that Huayi Brothers has established a professional distribution company in the past 20 years since entering the film industry. Immediately afterwards, Huayi Brothers also invested and established Huayi Brothers (Beijing) Film Distribution Co., Ltd. through Huayi Brothers (Beijing) Film Distribution Co., Ltd., and introduced advantageous shareholders such as Shanghai Film Group, Microfilm Times, and Dadi Shichuang. Its determination to further enhance its influence on the terminal market and boost the box office performance of the film business is evident.

In terms of brand licensing and real-life entertainment, as of the end of 2016, Huayi Brothers had signed a total of 16 brand licensing and real-life entertainment projects, and operating income increased by 362.34% compared with the same period in 2015. In 2017, Huayi Brothers Live Entertainment will have several projects under construction, among which the first theme park project "Huayi Brothers Film World (Suzhou)" will open within the year.

In June 2016, Huayi Chuangxing, a subsidiary of Huayi Brothers, was selected as the innovation layer of the national small and medium-sized enterprise share transfer system. The "Star and Shadow Alliance" it created is the first domestic mobile launched by Huayi Brothers and Tencent, two cross-industry leaders. Internet fan economic products are currently the largest celebrity fan interaction platform in China, with a total of more than 180 million users. On March 24, Huayi Chuangxing released its annual report. In 2016, the company achieved operating income of 179 million yuan and net profit of 65.902 million yuan, a year-on-year increase of 19.43%.

In terms of games, Huayi Brothers Holding Company Yinhan Games had a stable overall operating performance in 2016. It launched the first movie-game linked mobile game "Fantasy City", and has begun to prepare film and television dramas, literature, animation, and surrounding its hit IP "Time and Space Hunter". and other multi-dimensional derivative products. In 2017, Yinhan will also develop a new game "Time and Space Hunter 3D". In May, it will launch a video-game linked IP mobile game-"Beautiful Beauty". The S-level IP mobile game "Fate of the King of Fighters" will be launched during the summer. Yinhan Games will also join hands with the animation IP "Materia Medica Fairy Cloud" in 2017 to enter the secondary market.

On the night of the annual report's release, Huayi Brothers also released its first-quarter 2017 results forecast, with an expected loss of 63 million yuan to 68 million yuan. Some analysts pointed out that in 2016, amid severe market shocks, Huayi Brothers suffered a "small year" due to the impact of its film business, but its net profit performance remained stable, and while maintaining its advantages in content production, it made efforts to make up for its shortcomings. The determination is very clear. In the future, as its business landscape is further improved and the film business returns to a strong position, the forward-looking nature of its overall business layout and the scientific nature of the value chain will be further confirmed.

Editor: Nancy