Lesi Group (2540) H2 2023 earnings summary

Executive summary

• FY2023 revenue rose 27.5% to RMB628.0m, while gross profit was nearly flat at RMB104.0m and net profit fell 3.5% to RMB65.9m.

• Growth was led by mobile advertising solutions demand; rising service costs and lower media-partner rebates pressured margins.

Financial highlights

• Revenue RMB628.0m, up 27.5% YoY; costs of services increased 34.5% to RMB524.0m.

• Gross profit RMB104.0m, up 0.9%; operating profit RMB70.7m versus RMB72.6m; profit before tax RMB68.4m versus RMB71.0m.

• Net profit RMB65.9m, down 3.5%; attributable profit to equity shareholders RMB65.2m versus RMB67.3m.

• Basic and diluted EPS RMB0.17 versus RMB0.18; total comprehensive income RMB63.9m versus RMB68.2m, including RMB2.0m negative currency translation.

Outlook and guidance

• Priorities include expanding in-house short-video production, upgrading the self-developed platform with data automation and algorithms, and exploring AI applications.

• Plans to explore cross-border e-commerce collaborations and potential M&A to broaden capabilities, geographic reach and customer base.