Use M & A to Dress Up 2017 Performance
Every reporter Xu Lianlian and Ding Zhouyang’s editor Du Wei in 2014 and 2015 can be described as a year of A-share mergers and acquisitions. Among them, the film and television and game sectors are hot spots for mergers and acquisitions, and cross-border mergers and acquisitions are frequent.
For example, Songliao Motors (now “Wintou Holdings”) acquired Shanghai Duwan Network, Dadongnan acquired Shanghai Youtang Network, and Julong Pipe Industry acquired Aegras Technology. The amount of acquisitions was basically over 1 billion. These traditional companies have changed.And start “telling the story of the game.”
Recently, listed companies have issued 2017 annual performance notices and quick results.
“Daily Economic News” reporter combed a “transcript” issued by a listed company with games as its main business based on wind data.
Among the 36 gaming companies that have announced their results, 15 companies have seen penetrating gains or losses in listed companies ‘net profits due to mergers and acquisitions.
A large number of companies have serious financial reports because the target results of mergers and acquisitions have not been completed, and the aftermath of mergers and acquisitions has gradually begun to appear.
Internet demographic dividend no longer results in mergers and acquisitions leading to large growth in performance “Daily Economic News” reporters found from 36 game companies that have released quick performance reports that the overall performance of game companies in 2017 is not bad, and many companies ‘performance has increased significantly.Zhongqingbao, Xunyou Technology, Kaiying Network, Aeglas, performed well in the financial report, with an average increase in net profit of more than 100%, and Zhongqingbao’s net profit rose by a staggering 237.
In 2016, the popularity of mergers and acquisitions of game-listed companies continued to increase. Tianshen Entertainment, Aofei Entertainment, Palmtech, Kunlun Wanwei, Giant Network, Perfect World, Zhongqingbao, and other companies successively merged and reorganized.
Under the pressure of three-year performance commitment of M & A and reorganization, the performance of game companies in 2016 was greatly enhanced by M & A.
By 2017, the trend of games listed companies relying on mergers and acquisitions to make up their performance is more obvious.
In analyzing the “enthusiasm for mergers and acquisitions” of listed game companies, Miao Chunyang, a senior game investor and partner of Shenzhen Kunfang Venture Partners, told the Daily Economic News reporter that the growth of the game industry is largely due to the rapid development of mobile Internet.Brought, but now the demographic dividend of the domestic mobile Internet is almost over.
“The game industry is also a highly traffic-dependent industry. Now almost all of the traffic entrances are occupied by Tencent and NetEase. Without traffic, game companies cannot play.
In order to boost performance, game listed companies can only reach for mergers and acquisitions.
“And as the game industry cools down and market share is increasingly concentrated with giant companies such as Tencent, the target of mergers and acquisitions by game listed companies is no longer attached to game project companies.
For example, Xunyou Technology, which has a net profit growth rate of 164% in 2017, acquired the mobile Internet tool development and promotion company “Lion’s Roar” at a high price of $ 2.7 billion last year. The lion’s trump card product is “Mobile phone cleaning optimization butler”, APPs such as” Mobile Lock “are obviously very large compared to game projects.
”Because the game industry has changed a lot, the market likes new and hates the old, and R & D often can’t keep up with the pace of the market, so game companies are eager to use M & A to extend the extension and use the number of projects to pile up to meet the growth of performance.
Cao Haitao, an investor in the field of cultural and creative industries, told the reporter of “Daily Economic News”, “However, it is important to note that some companies did not maintain stable growth because of the large increase in M & A performance last year, not because the fluctuations were particularly large.
“In the case of Qingbao, the net profit in 2017 increased by nearly 238% compared with the same period in 2016.
One of the reasons is “there are too many reports, and a business combination under the same control has occurred. The company merged Shenzhen Proton Internet Technology Co., Ltd.”.
The net profit attributable to shareholders of the listed company realized by the merged party during the reporting period was approximately 21 million.
However, Zhongqingbao spent more than US $ 400 million in 2013, and the acquisition of Meifeng Digital and Sumo Technology in Dafa’s income bag caused hidden performance risks.
In 2014, Meifeng Digital and Sumo Technology did not complete their performance commitments, and Zhongqingbao’s net profit was about -22 million.
In 2016, Zhongqingbao’s net profit continued to expand and expand by 176%, breaking through nearly 50 million yuan.
From this point of view, A-share game companies that use M & A to dress up their performance still have risks and challenges.
Corresponding to the “maternal body” of being unable to complete performance is dragged down. Corresponding to the sharp rise 深圳桑拿网 in performance, the performance of some companies has plummeted, and “mergers and acquisitions” have become one of the key words of performance change.
Reporters’ statistics found that among the listed companies with games as their main business that released their performance reports, 12 of them have risen sharply because of mergers and acquisitions, but 3 have also fallen sharply because of mergers and acquisitions.
Mergers and acquisitions can make the performance of listed companies better in the short term, but if the succession of the target of the merger and acquisition is weak, the performance of gambling can not be completed, it will also become a performance drag.
IResearch data show that 2013?
In 2015, the transaction value involving game mergers and acquisitions reached 105.6 billion US dollars.
A security 北京夜网 analyst who researched the media industry said in an interview with the reporter of “Daily Economic News” that through the Securities and Futures Commission to suspend the cross-border value-added of four industries including film and television, the number of mergers and acquisitions in the past two years has decreased,The aftermath of some M & A high premiums is beginning to show.
Game industry mergers and acquisitions are often accompanied by high premiums. Long-term analysts have said that in the case of A-share listed companies’ mergers and acquisitions of game companies, the premium is 15 to 30 times more.
High premium acquisitions are often accompanied by high amount of goodwill and performance gambling. Once the performance is not completed or the target revenue of the merger and acquisition is weak, it will inevitably bring risks.
Take Tianrun Digital Entertainment as an example, in 2017?
In June, its wholly-owned subsidiary Shanghai Diandianle had a net profit of 3534.
980,000 yuan, which is off the promised performance1.
15.0 billion is far away.
2016 deduction of non-net profit is limited to 7772.
730,000 yuan, 95% completed.
66%, performance is not up to standard.
This became one of the leading points in the net profit of Tianrun Digital Entertainment.
The securities analyst said that the merger and acquisition of game companies has a very short-term financial boost. Merge and acquisitions are accompanied by performance betting, and revenue will increase significantly. From the perspective of cash flow, game companies have good cash flow.
However, once performance gambling is not completed, then goodwill impairment will be required, and profits will be affected. “If performance gains are not achieved, goodwill impairment will be required, which will further affect financial data.
“Even if it cannot be completed, the target revenue of the merger and acquisition is still very important, and outstanding performance will lead to impairment of goodwill and bring improvement.
For example, Great Southeast Performance Express shows that in company 5.
4 out of 7.5 billion trillion.
The US $ 3.7 billion impairment of goodwill. The initial improvement in the performance of Great Southeast is the impairment of goodwill brought by the weak performance of game companies. The game companies that were acquired at a high price initially became mines with improved performance.
Many game companies have realized that mergers and acquisitions are only the beginning, and high-quality game products can make the company “lasting peace.”
Taking Century Huatong, a large-scale acquisition and expansion of games, as an example, it has gradually established its own game operation system and embarked on a self-developed road.
Air Force Century Huatong CEO Wang Yan said in an interview with “Daily Economic News” that “original” has always been the core competitiveness of game companies.
The trend of high-quality game products is becoming more and more obvious, which has led game companies to gradually shift from capital trends to product development.
The aforementioned securities industry analysts said that from 2016 onwards, the entire game industry has experienced a significant increase in concentration, and the targets of game companies acquired by a large number of companies will also be affected by the industrial environment.The richer but the limited entertainment time, the ordinary quality things, the smaller the living space will be.