– Revenue increases by 51.5% to HK$475.5 million; Adjusted Net Profit up 33.4% to HK$125.2 million;
– Successful Hong Kong listing and exceptional business model to drive long-term business growth
Medialink Group Limited (“Medialink” or the “Group”, stock code: 2230.HK), a leading distributor of quality media content and PRC’s largest Japanese animation distributor based on revenue in 2017, announced today its annual results for the year ended 31 March 2019 – the Group’s first annual results since its listing on the Main Board of The Stock Exchange of Hong Kong Limited (“HKEX”) in May 2019.
Owing to strong demand for quality media content in the region, revenue increased by 51.5% to HK$475.5 million during the year under review. Gross profit margin remained stable at around 48.0%. Profit attributable to shareholders increased by 12.4% to HK$105.6 million. Excluding a one-time listing expense of approximately HK$19.7 million, profit from core operations would have risen by 33.4%, which reflects the strong business flow and potential of the Group’s operation. The adjusted earnings per share were HK6.3 cents.
Even though the satisfactory results for the 2018/19 financial year were achieved prior to Medialink’s HKEX listing, the management team nonetheless wishes to thank shareholders for their support and confidence in the Group. Consequently, it has proposed a final dividend payment of HK1.3 cents per share, which represents a distribution of approximately 24.5% of the Group’s profit.
Ms. Lovinia Chiu, Chairman and Chief Executive Officer of Medialink, said, “Our encouraging performance was attributed to the rising demand for good-quality entertainment in Greater China, Asia and the US. Thanks also to the outstanding effort of our team in selecting well-received content and developing various innovative branding and marketing strategies. As we enter the 5G era where technological advancement will expedite both exposure and access to top entertainment content, we are prepared to capture the vast opportunities presented. While seizing such opportunities, we will nevertheless adhere to our core values of encouraging development of the creative industry in Hong Kong; supporting locally developed contents and characters; and bringing positivity and happiness to every community we serve.”
Revenue from media content distribution grew by 45.9% to HK$424.6 million, due to an increase in the number of active titles distributed. According to the latest market research figures, Medialink placed first among Japanese animation distributors in the PRC based on revenue in 2017, accounting for approximately 14.1% of the market. Capitalizing on Medialink’s strong industry connections and distribution network, the Group has also in recent years commenced investing in content production which is starting to bear fruit, with revenue contributions from this new segment, i.e. theatrical release income, gradually increasing. Although such contributions are still small at this time, the management looks forward to stronger results from this business segment in the coming years, as it is believed that direct ownership of intellectual property (“IP”) will enable the Group to generate even more sustainable revenue.
Revenue from brand licensing increased by 123.7% to HK$51.0 million, due to the securing of more active licensing brands/characters, as well as more diverse branding efforts and events organized during the year. The latter involved themed hotels and cafes, roadshows in shopping mall, brand anniversaries and other exciting events. The variety of merchandise produced that carry the Group’s brands/characters has also continued to increase; ranging from pre-school necessities to anniversary-edition merchandise that are adored by grownups who are young at heart.
Ms. Chiu continued, “Our business model is underpinned by an established platform which facilitates the crossover of content distribution, content development, brand licensing and merchandise commercialization opportunities. Through our people, our network, our ties with business partners, we have established a business model that enables us to derive unlimited opportunities, hence is our core asset and fundamental to the Group’s growth.”
“Going forward, we will continue to leverage our business model to realize growth, both in terms of the breadth and depth of our operations. In respect of the former, we will seek to extend our reach in the PRC, our largest market, as well as the US and Hong Kong, while at the same time explore new markets in Asia. As for strengthening the depth of operations, we will initiate more creative business strategies and crossover opportunities, as well as bring together business partners to develop innovative and lucrative business opportunities. Furthermore, greater effort and resources will be directed towards media content production. In particular, we plan to direct our attention towards locally developed content with the objective of serving as facilitator for the Hong Kong market; we will seek to discover unique and creative content with high potential, and enable such content to receive the international exposure that they deserve.” Ms. Chiu concluded.
About Medialink Group Limited
Medialink Group Limited (2230.hk) is a leading distributor of third-party owned media content headquartered in Hong Kong with presence in the PRC, Singapore, Malaysia, Taiwan, Indonesia and Japan. The Group has been engaging in the business of media content distribution for over 18 years, and also operates the brand licensing business. Under the media content distribution business, the Group cooperates closely with media content licensors through entering into content distribution arrangements and distributes media content relating to animation series, variety shows, drama series and animated and live-action feature films. Under the brand licensing business, the Group is involved in licensing of various rights in relation to brands owned by brand licensors including ‘merchandising rights’ for the use in toys, apparels and footwear, health and beauty products, food and beverage; ‘location-based entertainment rights’ for events, theme parks, shopping malls, cafes and restaurants; and ‘promotion rights’ in the Asia Pacific region. According a report issued by Frost & Sullivan, the Company ranked number one among Japanese animation distributors in the PRC in terms of revenue in 2017.
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