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Linekong Interactive Announces 2014 Annual Results

2014 Adjusted Non-IFRS Net Profit Surged by 95.4%

HONG KONG, Mar 26, 2015 - (ACN Newswire) - China's leading mobile game developer and publisher, Linekong Interactive Co., Ltd. ("Linekong Interactive" or "the Company"; HKSE:8267) is pleased to announce the audited consolidated results of the Company and its subsidiaries (collectively, the "Group") for the year ended December 31, 2014.

2014 Financial Highlights:

- Revenue for the year ended December 31, 2014 amounted to approximately RMB678.7 million (2013:approximately RMB515.0 million), representing an increase of approximately 31.8% as compared to that of the year ended December 31, 2013.

- Gross profit for the year ended December 31, 2014 amounted to approximately RMB331.3 million, representing an increase of approximately 22.4%, from approximately RMB270.6 million recorded in 2013.

- The unaudited adjusted Non-IFRS net profit for the year ended December 31, 2014 derived by excluding non-operational and one-off items amounted to approximately RMB164.8 million (2013:RMB84.3 million), representing an increase of approximately 95.4% as compared with the preceding year.

- As of December 31, 2014, the 8864.com platform had approximately 85.0 million registered users, compared to approximately 70.6 million registered users as of December 31, 2013

The Group's revenue increased by approximately 31.8% from approximately RMB515.0 million for the year ended December 31, 2013 to approximately RMB678.7 million for the year ended December 31, 2014. The increase was primarily due to (i) an increase in revenue generated from Sword of Heaven and an upgraded version of the game launched in October 2014, and (ii) an increase in revenue generated from Blade of God launched in March 2014. The Group's unaudited adjusted net profit for the year ended December 31, 2014 was approximately RMB164.8 million, representing an increase of approximately 95.4% from approximately RMB84.3 million for the year ended December 31, 2013.

Revenue from mobile games accounted for approximately 88.1% of total revenue in 2014. Especially, Excalibur, Sword of Heaven and Blade of God all achieved peak monthly gross billings of more than RMB30 million in a short period after commercialization. Revenue generated from these three games was approximately RMB541.2 million, accounting for approximately 79.7% of our total revenue during the year ended 31 December, 2014.

Business Review

In 2014, The Group has continued to develop new mobile games as well as publish new high-quality licensed games from third-party game developers, which further expanded the Group's player base and diversified our revenue sources. Revenue from mobile games accounted for approximately 88.1% of our total revenue during 2014, comparing to approximately 48.4% for the year ended December 31, 2013. Especially, Excalibur, Sword of Heaven and Blade of God all achieved peak monthly gross billings of more than RMB30 million in a short period after commercialization.

As of December 31, 2014, we had commercialized 17 online games, including 10 self-developed games and 7 licensed games. Among these games, five were mobile games, four were webgames, seven were client-based games and one had both client-based version and web version. Meanwhile, the Group's cumulative registered players increased from approximately 132.3 million as of December 31, 2013 to over 174.4 million as of December 31, 2014.

Based on our global strategy, the Group set up subsidiaries in Hong Kong and South Korea in 2014 and started publishing games in South Korea. In addition to working with about 150 third-party game distribution channels in the PRC, the Group has endeavoured to strengthen own game distribution platform, 8864.com and game operation system in order to attract and retain more players. As of December 31, 2014, the 8864.com platform had approximately 85.0 million registered users, compared to approximately 70.6 million registered users as of December 31, 2013.

Finally, the shares of the Company were successfully listed on the GEM of the Stock Exchange on December 30, 2014, marking a milestone for the Group in improving its capital strength and corporate governance as well as enhancing its competitive edge.

Prospects

The Group will synergize the self-developing and publishing business, vigorously promote the "Great Entertainment" strategy, and proactively proceed with the construction of IP ecological system. Meanwhile, we will strengthen the layout of our "Great Entertainment" and IP ecological system through strategic investment.

In 2015, the Group will launch more popular IP supported games including 'One Hundred Thousand Bad Jokes', 'The Legend of Zhen Huan' and 'The White Hared Witch'. In particular, 'One Hundred Thousand Bad Jokes' was launched on all platforms on March 18, 2015 and achieved remarkable results, with over 1.42 million DAUs after 3 days post-launch. 'One Hundred Thousand Bad Jokes is a 3D RPG collectible card game applying round system, which was adapted from an original and highly popular online funny comic in the PRC. Such comic has been played over 2 billion times online in an accumulative basis. The Legend of Zhen Huan is a 3D collectible card game applying round system, which was adapted from 'The Legend of Zhen Huan', one of the most popular TV shows in the PRC. The TV shows has been played over 7 million times online. The 'White Haired Witch' is a 3D MMORPG game adapted from a famous Kung Fu novel with same name in the PRC.

In 2015, the Group will attach more importance to the iPhone App Store market and endeavour to boost the ranking of our games in the Top Charts of iPhone and other Apple tablet devices. Meanwhile, we will expand the influence of our games on all platforms through focusing on marketing in the iPhone user market, together with joint operation on the mainstream Android platforms in the PRC.

On the overseas market, it is expected that we will establish subsidiaries in more countries and regions and gradually build a comprehensive global R&D and publishing system, so as to popularize more diversified self-developed and licensed games in more countries and regions.

About Linekong Interactive Co., Ltd.

Linekong Interactive Co., Ltd. ("Linekong Interactive"; HKSE:8267) has been a reputable online game company and became a leading mobile game developer and publisher in China in recent years. Leveraging its strong game development capability, extensive experience in developing and publishing midcore and hardcore games and the comprehensive games distribution network, Linekong Interactive successfully shifted its business focus from client-based games and webgames to mobile games in 2013. Linekong Interactive ranked tenth among all mobile game developers in China in terms of gross billings in 2014 As of December 1, 2014, Linekong Interactive has commercialized 17 online games, including 10 self-developed games and 7 licensed games. The Company was successfully listed on GEM of Hong Kong Stock Exchange on 30 December 2014.


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