At present, the release of semi-annual reports by listed companies has concluded. In the first half of 2017, the radio and television industry maintained its growth momentum, although the pace of growth slowed down. Despite this, the industry still shows optimism for the future.
According to Wind data, the revenue of the media segment in the first half of 2017 rose by 15.88% year-on-year, while the overall sector's growth rate dropped from 21.72% in the same period of 2016. Within the segments, the main contributors to growth were gaming (37%), technology value-added services (29%), marketing (17.5%), and film and television animation (9%). However, the slowdown in overall growth was mainly due to a year-on-year decline in growth rates across all sub-sectors, with the film and television animation segment declining by 22% and the gaming sector falling by 45%.
The film and television industry experienced slower growth but remained relatively stable. Revenue reached 30 billion yuan, and net profit hit 5.1 billion yuan in the first half of 2017, showing increases of 11% and 12% respectively. However, these growth rates were significantly lower than those seen in previous years. For instance, the revenue growth rate in the first half of 2014–2016 was 29%, 77%, and 37%, while net profit growth was 57%, 86%, and 43%. Analysts at GF Securities noted that this decline was partly due to fewer big shows being confirmed and slower performance growth during the first half of 2017.
Meanwhile, film and television companies began focusing on cost control to maintain profitability. The net profit margin and gross profit margin for the industry stood at 17.0% and 35.6% respectively, showing slight upward trends. From 2013 to 2017, the net profit margin increased from 13% to 17%, and the gross profit margin rose from 28% to 36%. Quarterly data showed that both revenue and net profit for the film and television industry increased in the second quarter of 2017 compared to the first quarter.
Looking at the broader industry, out of 26 companies in the film and television content sector, 19 achieved positive revenue growth in the first half of 2017, and 16 saw net profit growth. Leading film production companies like Huayi Brothers and Ray Media reported net profit growth over 20%. However, movie theater companies such as Happy Blue Ocean and Shanghai Films experienced declines due to weaker box office performance. Wanda Cinema remained an exception, maintaining a 10% net profit growth.
In the video and TV content industry, major TV drama producers had a relatively flat performance, though some companies like New Culture and Meisheng Culture saw strong growth. The industry is undergoing strategic shifts, with companies diversifying their business models to reduce risk. As analysts suggest, the second half of the year may bring a performance turnaround, driven by increased demand for premium content, higher ticket prices, and improved revenue recognition.
The cable TV network sector, on the other hand, faced a decline in net profit for the first time, despite a slight increase in revenue. This was attributed to falling subscription fees and a drop in user numbers. However, some companies like Radio and TV Network and Guiguang Networks managed to maintain positive growth through value-added services and broadband expansion.
Overall, while the film and television industry faced challenges in the first half of 2017, there are signs of recovery and transformation ahead. With continued investment in content and digital services, the sector is expected to show stronger performance in the coming months.
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