V1 Group Ltd
V1 Group Announces 2018 Annual Results Group Embarks on New Strategic Direction of ‘Digital + New Culture and Sports’

[For Immediate Release]

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V1 Group Announces 2018 Annual Results
Group Embarks on New Strategic Direction of ‘Digital + New Culture and Sports’

Hong Kong, 27 March, 2019 – V1 Group Limited (“V1 Group” or the “Group”; Stock code: 82.HK) has announced the annual results of the Group and its subsidiaries for the year ended 31 December, 2018. Turnover of the Group for the year ended 31 December, 2018 amounted to HK$3.382 billion, representing an increase of 562.3% compared with the same period last year. The increase in turnover built an important marketing channel for IP consumer electronics derivative products of Interactive Space-time. It also underpinned the “local e-commerce” strategy of V1 Portal and the “Silk Road New Retail” strategy adopted by the China Arab TV (CATV). Meanwhile, gross loss decreased by 72% and the profit trend of various businesses is recovering.

Loss attributable to the owners for the period was HK$648 million, representing an increase of approximately 76.8% compared with the same period last year. The loss was primarily attributable to the increase in impairment of intangible assets and goodwill as a result of the occurrence of new technology, impairment of interest in an associate, and the new operation expenses.

In 2018, the Group actively divested businesses with less synergy and acquired Fengkuang Tiyu (瘋狂體育) and Interactive Space-time (互動時空), forming the new strategic direction of “digital + new culture and sports (new media, new culture and new sports)”. According to the acquisition agreement, Fengkuang Tiyu guarantees 2018/2019/2020 net profit of not less than RMB40 million/50 million/63 million respectively. In 2018, both the annual income and profit of Fengkuang Tiyu exceeded the profit guarantee.

Optimized Resources to Improve Strategic Layout
The Group has enjoyed great results after years of endeavor and commitment. V1 Portal has cooperated with CATV to develop a standardized media business of domestic and overseas news. The gaming resources and operational experience gained from the mobile game business, along with the information service business, big data regarding sports fans and relevant channels derived from the operation of our lottery business have laid a solid foundation for the Group’s future business.

Fengkuang Tiyu
The Group completed the acquisition of Fengkuang Tiyu in November 2018, a mobile internet product that provides sports information, event news, live interactive games and other services for sports fans. The acquisition adheres to the strategic direction of “digital + new culture and sports”.

As the only senior partner of the official game of the Chinese Football Super League (CSL), Fengkuang Tiyu was authorized to launch and operate the CSL game IPs worldwide from 2017 to 2022, including the rights to use the relevant IP licenses of the CSL, clubs, players and head coaches. Fengkuang Tiyu can customize related computer and mobile games based on the CSL IPs cooperation. In line with the concept of “Let sports create happiness”, Fengkuang Tiyu has satisfied the needs of a large number of sports fans by innovating mobile internet products and services, and has spared no effort in games, paid lottery recommendations and live interactions.

Interactive Space-time
As the non-wholly owned subsidiary of the Group, Interactive Space-time is focused on developing the design, production and marketing of IP-licensed derivatives; and dedicated to building China’s largest customization platform for IP products. It successfully obtained the license to develop, produce and sell various consumer electronics products featuring characters in the “Transformers” film series, such as Bluetooth speakers and routers, among 39 consumer electronics products. As of the end of 2018, it had 21 independent patents and was applying for 11 patents simultaneously.

In 2019, Interactive Space-time planned to set up a North American branch to cooperate with the world’s top IPs, and also strives to reduce development costs and maximize the economic value of IP. Meanwhile, the company will expand and integrate the mainstream online and offline marketing channels, such as chain stores and regional digital pipelines, to fight for a larger market share.

Liangzi Gang (量子港)
As a digital trading platform of V1 Group for products of consumer electronics, Liangzi Gang’s management team has extensive experience in the e-commerce industry, consumer electronics industry and supply chain management. In the future, Liangzi Gang will continue to establish long-term cooperation with outstanding enterprises across more than 150 countries and regions under “The Belt and Road” and APEC. With an aim to build a borderless, commons and win-win commercial world, it will focus on providing competitive supply chain solutions, products and services to its partners, including various enterprises, value-added service providers and retailers as well as their consumers.

V1 Portal
In 2018, V1 Portal took “V1 Group is on live” as its slogan and implemented a new “live-broadcast +” development strategy, which is focused on the business live broadcast market (B live-broadcast) with greater market space and potential, to provide various enterprises with a one-stop live-broadcast marketing service. In 2018, it completed more than 600 live-broadcast services covering various sectors such as news, sports and finance, and satisfied the diversified needs of users for live-broadcasts through cooperation with well-known enterprises.

Meanwhile, V1 APP developed its e-commerce business by introducing e-commerce product displays into the app in forms of live broadcasts or short videos, thereby building its own platform to achieve commercial sales, in order to develop a national local news reporting platform and e-commerce integration platform.

China Arab TV (“CATV”)
As the information exchange platform between China and the Arab countries, CATV has made several reformations, such as changing the bilingual from “Chinese-English” to “Chinese-Arabic”, and shifting its targeted audience from overseas Chinese to Arabic users, so as to expand the influence of CATV.

Besides, CATV has made efforts to develop “media +” through actively participating in various media-related activities in Dubai and Beijing; and partnering with numerous exhibitions and forums of great importance. CATV will continue to capitalize on mechanisms of markets, funds and policies to pool a variety of innovative resources. CATV will put ideas into practice to realize business innovation and achievement transformation; and will continue to carry out on-site activities, exhibitions and shows and cooperation forums in Dubai with all cooperative parties.

Dr. Zhang Lijun, Chairman of the Board of V1 Group, said, “Since 2018, we have been focusing on our strategic direction of ‘digital + new culture and sports’. After repetitive attempts, we have yielded initial results. V1 Group now focuses on ‘digital + new culture and sports’. By leveraging on Fengkuang Tiyu and Interactive Space-time, we aim to target this three trillion-dollar market of sports, games and consumer electronics. Our games, lottery and derivative products will be the engine of the Group, coupled with media and financial investment to forge a new operation system which facilitates a healthy development of our businesses. We strongly believe that, after years of endeavor and commitment, 2019 is the year of maturity and growth, we will continue to strive to deliver the great renaissance of V1 Group and to create ideal returns for shareholders in the long run.”

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About V1 Group Limited
V1 Group was established in 2005，and went listed on the Main Board of Hong Kong Stock Exchange in 2006, as the first listed Chinese company in the internet video industry. In 2015, V1 Group has established itself as one of the largest new media companies in China, later successfully transformed to be an internet conglomerate in 2016, its portfolio consisted with various business lines including media, healthcare, fintech, and cutting-edge information and communications technology. In 2018, V1 Group completed its acquisition of Easy Prime Developments Limited (Crazy Sports), accelerating its development of core business in “digital + new culture and sports”.

V1 Group Limited IR website: http://ir.v1.cn

This press release is distributed by Hill + Knowlton Strategies on behalf of V1 Group Limited.

For further information, please contact:
Hill + Knowlton Strategies
Alby Wan/ Cindy Chen
Tel: (852) 2894 6267 / (852) 2894 6268
Fax: (852) 2576 1990
E-mail: v1group@hkstrategies.com