As the first half-yearly report after listing, the performance of Bona Pictures may not be satisfactory to the outside world.

In the first half of 2023, Bona Pictures' revenue and return net profit were 850 million yuan and-265 million yuan respectively, down 42.31% and 212.22% respectively from the same period last year.

In this regard, Boehner Pictures explained that the main reason is that the company's investment in films during the reporting period is of a different order of magnitude from that of last year, and its performance is not as good as that of the same period last year.

However, under the tide of recovery of the film industry, the performance is difficult to compare with the same period last year is also a challenge to the core competitiveness of Bona Pictures.

Although Boehner Pictures released significantly more films in the first half of this year than last year, the overall performance was mediocre. At the same time, "nameless" starring Wang Yibo was released during the Spring Festival, but in the end, the box office of 987 million yuan was no match for "Man Jiang Hong" and "wandering Earth 2".

The dismal box office led to a sharp decline in revenue from Bona Pictures's film business, generating only 313 million yuan in the first half of 2023, down 76.48 percent from a year earlier.

ID:TradeWind01 noted that on the B side of the sharp decline in revenue, Boehner Pictures' accounts receivable remained high, resulting in negative net cash flow from its operating activities.

By the end of June this year, Bona Pictures had accounts receivable of 830 million yuan, accounting for 97.65% of revenue. The net cash flow generated by operating activities in the same period is only-120 million yuan.

Bona Pictures still faces a lot of challenges.

Four are not as good as one.

In the first half of this year, the recovery of the film industry rolled over, and the performance of many related companies achieved a certain growth.

In the first half of 2023, the net profit of 300251.SZ was 203 million yuan, a year-on-year growth rate of 1.12%.

However, Boehner Pictures did not achieve the desired positive growth, or even a loss.

In the first half of 2023, Bona Pictures' revenue and return net profit were 850 million yuan and-265 million yuan respectively, down 42.31% and 212.22% respectively from the same period last year.

"the order of magnitude of the company's investment films during the reporting period is different from that of last year, and its performance is not as good as that of the same period last year." Bona Pictures said.

In terms of volume, Boehner Pictures released significantly more films in the first half of this year than in the same period last year, mainly due to poor box office performance.

In the first half of 2022, Boehner's main film "Watergate Bridge of Changjin Lake" and the participating film "the four Seas" were released, grossing 4.067 billion yuan and 543 million yuan respectively, of which "Watergate Bridge of Changjin Lake" topped the box office list of that year.

In the first half of 2023, Boehner Pictures' two main casting films, nameless and Don't call me God of gamblers, as well as two participating films, "the Wind Rises" and "the King of the Sky," were released as scheduled, but the total box office as of August 31 was only 1.927 billion yuan, less than half of the box office of a film in the same period last year.

Among them, "nameless" was released during the Spring Festival, starring well-known artists Liang Chaowei, Wang Yibo, Zhou Xun and Huang Lei, but the total box office was only 987 million yuan, not even crossing the 1 billion yuan mark. By contrast, the Spring Festival films "Man Jiang Hong" and "wandering the Earth 2" grossed as much as 4.544 billion yuan and 4.029 billion yuan respectively.

This led to a sharp decline in revenue from Bona Pictures' main film investment and distribution business, which fell 76.48 per cent year-on-year to 313 million yuan in the first half of 2023.

At the same time, Boehner Pictures has further eroded its net profit by making provision for write-downs on projects that are not as expected.

In the first half of 2023, bona Pictures raised a total of 128 million yuan in assets and credit impairment losses, accounting for 48.30% of the mother's net profit (absolute value), mainly related to accounts receivable, inventory and so on.

ID:TradeWind01 notes that Bona Pictures' accounts receivable as a percentage of revenue is not low, reaching 97.68 per cent in the first half of 2023.

In the same period in 2023, Bona Pictures recorded a credit impairment loss of 44 million yuan on accounts receivable with an original book value of 1.032 billion yuan, and its credit impairment loss totaled 217 million yuan by the end of June this year.

Bona Pictures expects the remaining 830 million yuan to be recovered, of which more than 60% comes from the top five customers.

Bona Pictures' financial notes give a hint of the risk of credit concentration.

"as our company only deals with recognized and creditworthy third parties, no collateral is required." Bona Pictures said, "as of June 30, 2023, the company had a certain concentration of credit risk, and 65.03% of the company's accounts receivable (December 31, 2022: 61.92%) came from the top five customers. The company does not hold any collateral or other credit enhancement corresponding to the balance of accounts receivable. "

As a result, Bona Pictures' income is only rich on paper after all, and the actual cash flow of its operating activities is mediocre.

As of the end of June this year, the net cash flow generated by Bona Pictures' operating activities was only-120 million yuan.

This may not be the norm for film and television companies.

In the same period, the net cash flow generated by the operating activities of Light Media, Golden Yi Film and Television (002905.SZ) and 300027.SZ were all positive, reaching 115 million yuan, 237 million yuan and 25 million yuan respectively.

Half of the cinema line is propped up.

With the economic recovery after the epidemic and the increase in offline passenger flow, the cinema business of Bona Pictures still gets a piece of the pie.

In the first half of 2023, Bona Pictures's cinema business generated 600 million yuan in revenue, which is basically the same as the sector's annual revenue in 2022, an increase of 64.64% over the same period last year, accounting for 70.59% of the revenue.

By the end of June this year, Bona Pictures had 102 own studios with a total of 850 screens, including 30 IMAX, 16 BONA ONE, 3 CINITY and 24 giant screens in China.

But Boehner Pictures seems to have no intention of increasing the number of screens.

In the fund-raising project of IPO in 2022, Bona Pictures originally planned to use 210 million yuan to raise funds for the construction of cinemas, with a total decoration area of 47300 square meters and an increase of 3 IMAX and 6 giant screens.

But now the fund-raising has been used entirely for investment in film projects, of which 110 million yuan has been used to invest in the film Legend.

According to public reports, the Legend continues the story of "Myth" starring Jackie Chan and Kim Hee Seon, which earned 97 million yuan at the box office when it was released in 2005. There is still uncertainty about whether "Legend" is expected to replicate the success of "Myth".

It is also unclear whether the inventory of Boehner Pictures' pending films is expected to boost results in the second half of the year.

At present, other films to be released are "A Mai joining the Army", "A Dream of Red Mansions" and "practice Love."

Unlike the previous direction of focusing on the theme film, the themes of the three Boehner films tend to be costume and comedy style. "A Mai joining the Army" is adapted from the online article of the same name written by Crown Princess Promotion, which tells the story of the female god of war. "A Dream of Red Mansions" is based on the story of A Dream of Red Mansions. "Internship Love God" is the theme of fantasy comedy.

After stepping out of the comfort zone of the theme, whether Boehner Pictures can use these three films to reverse its declining performance in the second half of the year remains to be further verified at the box office.