HONG KONG -- (ACN Newswire) --

HONG KONG, Aug 30, 2015 - (ACN Newswire) - V1 Group Limited (the "Company" or "V1") is pleased to announce that the results of the Company and its subsidiaries (the "Group") for the first half of 2015. Turnover of the Group for the six months ended 30 June 2015 amounted to HK$1,012,751,000 representing an increase of around 35.4% as compared with the corresponding period last year. Total assets exceeded HK$4,856,332,000, representing an increase of around 7.2% as compared with the balance as at 31 December 2014.

Lottery-related Business

Income from lottery-related business amounted to HK$29,164,000, representing a decrease of around 71.5% as compared with the corresponding period last year. The unsatisfactory result for the period was mainly attributable to the adverse effects of the suspension of the operations of online sale of paperless lottery tickets and sale of lottery tickets through mobile phones of the Group's business partners in Mainland China with effect from 1 March 2015.

The Group's business partners will observe and comply with any new rules and regulations promulgated by the relevant PRC regulatory authorities and make adjustments to their operations of online sale of lottery tickets and sale of lottery tickets through mobile phones where necessary. And the Group will actively cooperate with its business partners with an aim to have lottery-related business of the Group back on the track as soon as possible.

Zhongguozucaiwang ( www.zgzcw.com ) and Diyicai ( www.diyicai.com )

The first half of 2015 witnessed the policy reform of the Chinese internet lottery industry and the exploration for the development of internet lottery businesses. In early 2015, the monthly lottery sales at www.zgzcw.com and www.diyicai.com reached another historical high, stimulated by the Asian Cup and game bets on fixed single matches.

In March 2015, the Ministry of Finance, the Ministry of Civil Affairs and the General Administration of Sport of the People's Republic of China (the "PRC") jointly promulgated the Notice on Issues Regarding Conducting Self-examination and Self-correction Activities of the Unauthorised Sale of Lottery through Internet, bringing the suspension of internet sale of lottery tickets. Thus, the Chinese internet lottery industry is facing the fifth time of rectification, and again the entire industry entered into a period of confusion on development. During the period of policy reform, the lottery-related business partners of V1 Group decided to develop through three main aspects, including "Information and Data", "Value-added Services" and "Innovative Service Models", exploring an efficient operating approach to boost user activity.

Grasping Key Matches and Analyzing Information and Data

In April 2015, Zhongguozucaiwang launched a "Lottery Information" channel and its brand-new HTML5 version, with a precise focus on seven key matches, namely, "Five European League Matches", "UEFA Champions League", "Asian Club Championship", "Copa America", "FIFA Women's World Cup", "European Championship Qualifiers", and "Chinese Football Association Super League". The website has focused concentrated its resources on building a leading matches center of the industry and rolled out special features, schedule points, key rivals and matches analysis for important matches, with full coverage of the homepage search results of three main search engines - Baidu, 360 and Sogou. Furthermore, in respect of scores and information, Zhongguozucaiwang and Diyicai have introduced the real-time scores and odds data from Sportradar, encompassing more than 70 league and cup matches of such countries as England, Germany, Italy, Spain, France, Portugal, Switzerland, Norway, Brazil and China. The two websites lead the industry in terms of the speed and accuracy of real-time scores and odds changes, substantially enhancing the user experience of information access.

In May 2015, Zhongguozucaiwang and Diyicai saw a full recovery of their page views; in June 2015, the page views of both websites surpassed the record prior to the sales suspension. "Information and Data" played a key role in retaining users and maintaining user activity for the two websites.

"Value-added Services" and "Innovative Service Models"

In respect of value-added services and innovative service models, the Group's business partner has collaborated with "Football" newspaper, No.1 professional print media of sports in China, to jointly roll out paid expert schemes and an expert recommendation platform at Zhongguozucaiwang. A large number of famous domestic experts, such as Su Qun, Boshu and Ding Weijie are invited to join the platform, providing users with paid expert schemes in the form of revenue sharing. After its launch of the expert recommendation platform on Zhongguozucaiwang on May 28 2015, the platform has attracted more than 200 experts to join for authentication, with an average of over 500 expert-recommended schemes released on a daily basis.

Tele-media Business

Income from tele-media business amounted to HK$57,162,000, representing an increase of around 304.3% as compared with the corresponding period last year.

Transforming to a PGC Platform and Promoting "Crowd-funding for Videos"

In 2015, V1 Portal (www.v1.cn) took the lead in launching its plan of building a PGC (Professionally Generated Content) platform, and developed more than 500 PGC content partners. V1 Portal will build this "Crowd-funding for Videos" model in which public invest on creators, creators provide contents, contents attract traffic, and investors share revenue with creators.

In the first half of 2015, V1 Portal has been committed to building itself into a Chinese "Youtube" platform. The new version of the website has been launched while completing the transformation to a PGC platform and achieving the public-to-creator revenue sharing.

Since March 2015, V1 Portal has started its transformation to become a PGC platform. As of 30 June, V1 Portal has secured more than 500 PGC partners, representing more than 150 per month on average. Among those partners are media and institutional partners such as Modern Sky, Trends Online, Feidieshuo, Yi Du, Mars Zone, BJmain, Titan Media and Takungpao.com, and celebrity and studio users such as Zhengyun TV, SiWenPiZi Studio, Yule Xinxianzhan, Big Wave of Tech, Big Xiao, Watson Animation, Jie Cao Xie Hui and Qiushi Baike.

A diversified strategy of combining self-produced programs with PGC customized contents has been adopted on program production. Apart from the fast and accurate "V1 Comment" dedicated to timely coverage and commentary on popular issues, V1 Portal has launched three new programs, namely, the variety show "Music Monitors" positioned for niche entertainment, the spitslot show "News Crackers" positioned for the Post-90s news audience, and "Entertainment Big Mouth" positioned to offer entertainment gossips. V1 Portal seeks to break through outdated models of news programs and focus on attracting the new generations of users who were born in the 1980s and 1990s.

In addition, V1 Portal has cooperated with renowned PGC celebrities to roll out two programs: the first program focuses on hot TV series namely "Influential TV Series", a TV commentary program cooperated with the famous Chinese film commentator Sima Pingbang; the other program focuses on interesting interpretation of history namely "Interpreting History", which is cooperated with the renowned columnist Liu Song.

V1 Portal served as the official partner designated by the Internet Society of China to provide exclusive live broadcast of the 2015 China Internet Conference. For the three-day event, V1 Portal dispatched a 15-member reporter team and produced a total of 185 news videos and exclusively interviewed 13 important guests, it was well recognized by the industry and delivering a good publicity effect. Moreover, V1 Portal has also won the "2014-2015 Public Welfare Award of Chinese Internet".

Since April 2015, V1 Portal cooperated with Modern Sky to provide online live broadcast of the famous Strawberry Music Festival and has finished the live broadcast in Wuhan, Xi'an and Changsha by now, with peak concurrent users exceeding 500,000. V1 Portal has substantially improved its brand awareness among music lovers.

In respect of the coverage on The National People's Congress ("NPC") and The National Committee of the Chinese People's Political and Consultative Conference ("CPPCC") ("Two Sessions") in 2015, V1 Portal produced a special program series "New Normal, New Layout", including 12 times of video live streaming, 10 programs, over 20 interviews with experts and more than 100 self-produced videos promoted across 100-plus media channels. Moreover, in the exclusive program "Wishes Across China", V1 Portal mobilized its video bloggers across the country to interview people from all walks of life, in a bid to make the masses' voice heard. A total of 87 exclusive videos were shot and produced. V1 Portal has also won the "2015 Two Sessions Excellent Online Reporting Organization Award", with its two key editors attaining the title of "Advanced Individual". During the conference, the total click rate of the Two Sessions feature webpage reached 11.89 million times.

In addition to retaining "World of Soldiers" and "National Spitslot", V1 Portal has continued to produce quality self-produced programs such as "Influential TV Series", "Interpreting History", "V1 Comment", "News Crackers", "Music Monitors", "Entertainment Big Mouth" and "Entertainment Latest", together with the partnership program such as "Talking about Football with Celebrities". In particular, V1 Portal has cooperated with Kaola FM broadcasting "V1 Comment", "Talking about Football with Celebrities", "National Spitslot", "Big Coming", "World of Soldiers", "News Crackers" and "Influential TV Series" through its platform, thus boosting the awareness of V1 Portal.

"V1 Mymedia", a V1 mobile app, is a brand-new all-in-one video app integrating video recommendation, searching, broadcasting, uploading and sharing, album management and interaction. The app stands as the first We Media video-distribution platform in China.

Since the V1 Mymedia app released its new version in April 2015, millions of users have downloaded the app where users follow the latest and hottest original videos offered by PGC partners everyday and subscribe to their favorite Mymedia video channels.

From March through July 2015, V1 Portal introduced heavyweight PGC players such as Zhengyun TV, Trends Online, Feidieshuo, efengvoice and Showplan Works. At present, over 500 PGC media and celebrities have registered on V1 Portal, enriching its content base, focusing on its target users and increasing its user activity. Furthermore, V1 Portal has joined hands with over 100 media agencies, such as The Beijing News, china.com.cn and 1905.com to initiate a series of activities on brand planning, public welfare and rewards. These activities have been exposed on Weibo for 70 million times and attract approximately 3 million WeChat fans. On top of that, V1 Portal has collaborated with Baidu and 1905.com in producing HTML5 pages in an effort to showcase great V1 PGC classic contents on the collaborators' platforms.

On 24 June 2015, V1 Portal together with over 500 content providers, initiated a plan for building the biggest PGC platform in China. The plan was aiming to provide PGC teams with all-round "butler value-added services", including helping them in equipment and office rental, distribution channels development and advertising marketing. The PGC products supported by the plan are not only disseminated on their own platform, but also being distributed through all the PGC partners' networks, which indicating that the video programs will attain a wider influence.

The PGC plan of V1 Portal is distinct from that of other websites. In addition to providing support and butler value-added services to its PGC partners, V1 Portal will put its "crowd-funding for videos" service into operation in the second half of this year.

V1Game (http://g.v1.cn)

The first half of 2015 was a sluggish period for web games. Due to major holidays such as New Year's Day and Chinese Spring Festival, the market saw only a few new games launched and almost no prime web games rolled out. Given this situation, the game center formulated an emergency strategy of making progress while ensuring stability. The center boosted its income by exploring more charging items and value-added services out of every product according to product and user characteristics and marketing approaches.

Meanwhile, the key of development is building and maintaining the industrial relationship by our commercial department. During the first half of 2015, V1Game has established partnerships with over 100 web game developers and half of whom have started the cooperation with us.

As of 30 June 2015, the web game platform has gathered more than 60 joint-operating products, half of which are prime games, 10% of which are top products (i.e. game products with monthly gross billings over RMB50 million through the whole channel). In addition, an average of over 300 sets of new servers are opened up each month. For merely half a year, V1Game platform has ranked top among Tier 2 platforms, bringing hot topics across the industry.

In May 2015, the new version of V1Game platform was officially launched as a supreme domestic product in terms of both functions and designs.

In respect of marketing, V1Game platform has conducted in-depth cooperation with over 50 professional media institutions in China in a wide array of fields, including trial-play websites, server-opening tables, game media and website alliance, such as telecommunications resource websites, novel websites, music websites and game website pop-ups.

In March 2015, V1Game officially launched the project to develop a HTML5 game platform and urgently recruit professional elites. Within only three months, a four-member team had completed the development of HTML5 game platform for both PC and mobile terminals, providing a complete range of functions such as registration, login, recharge, ranking and advertising.

V1Game currently offers over 1,000 HTML5 mini-games, one of the best approaches to attract and maintain the platform users, 10% of which were self-developed games. Going forward, there will be more mini-games of different types and styles being launched on the V1Game platform.

Presently, V1Game has started acting as exclusive agent of and jointly operating top HTML5 web games, its major income source in V1Game. Concrete proceedings will be carried out in the second half of 2015, while certain renowned domestic HTML5 products have cooperated commercially and technically via the platform. New products in the pipeline include Summoner College, Little Bird's Lover, Crazy On-hook Legend, Ceaseless Running, Who is the Singer, Sicong's Days and Run, Goddess.

Furthermore, V1Game has conducted differentiated cooperations by securing mobile users through short video apps such as Miaopai and grasping its market share and downloads by app market recommendation, content cooperation and mutual recommendation of vertical apps, with in-depth cooperation with PGC contents.

V1 Family

By virtue of V1 Portal's unique background and resource advantages, it took the lead to put forward V1 Family, which is a "media APP for individual celebrity" and a platform integrating contents in the forms of texts, photos, audios and videos.

At present, a number of web celebrities have participated in the platform, including Yu Jianrong, a famous commentator on current affairs, Chen Li, an expert commentator, Kong Qingdong, a web celebrity, Sima Nan, Deng Fei, and Sima Pingbang etc. In particular, the product of Kong Qingdong platform has over 2 million downloads.

Mobile Games Business

For the six months ended 30 June 2015, revenue from Mobile games business increased to HK$926,425,000, representing an increase of around 46.7% as compared with the corresponding period of last year. Segment profit was HK$93,422,000 (2014: Profit of HK$116,859,000).

The strong financial performance of the Group's mobile game business was driven by the success of its self-developed game and publishing distribution platform after its successful business transitioning process as well as prudent cost control management.

Heading into 2015, CMGE are facing increasing intense market competition in both publishing and self-developed game businesses. Despite that, for first half of 2015, CMGE's revenue remains steady growth year-over-year.

CMGE's social games have continued to perform solidly, including San Guo Wei Li Jia Qiang Ban, Super Hero and Crisis Action. Another unique 3D dance-themed game, Charming Dancer, began its closed beta testing on 21 January 2015. In early February 2015, CMGE published Uncharted Waters V in cooperation with Tecmo Koei, it became one of the few successful Japanese mobile games published in China in 2015.

CMGE's overseas publishing business made progress. Blood Reincarnation was published in Taiwan. Age of Tank was published in Russia and Korea and has been distributed on KAKAO Talk in Korea. In addition, CMGE published Super Hero on 10 February 2015 in Thailand, and ranked top 5 in popularity rankings on App Store and Google Play in Thailand. In addition, CMGE also published Rise of Darkness in North America on both Android and iOS on 20 May 2015. Rise of Darkness is an MMORPG mobile game published by Tencent in Mainland China, for which CMGE has the rights to publish in the United States, Canada, Australia and the United Kingdom. CMGE currently has a strong publishing pipeline in Mainland China as well as overseas. In particular, CMGE is cooperating with Disney and has obtained rights to publish the combat strategy mobile game Star Wars TM: Commander in Mainland China, Hong Kong, Macau and Taiwan.

In late January 2015, CMGE published Pleasant Goat and Big Big Wolf Rush("Pleasant Goat"), the world's first 3D running game that CMGE co-developed based on the Pleasant Goat IP rights that it acquired. In its first day of launch, Pleasant Goat reached 2.85 million downloads. CMGE began closed beta testing of New Legend of Sword and Fairy, co-developed with Softstar Technology, on 9 April 2015. In addition, CMGE has a number of games in various stages of development, both self-developed and co-developed, based on IP rights that CMGE has obtained.

On 19 June 2015, the Company announced that CMGE had entered into a merger agreement with Pegasus Investment Holdings Limited ("Offeror") and Pegasus Merger Sub Limited ("Merger Sub") pursuant to which CMGE and Merger Sub will effectuate a merger ("Merger"). Under the Merger all the Class A Shares, Class B Shares and American Depositary Shares ("ADSs") of CMGE will be cancelled and the holder thereof will be entitled to receive payment from the Offeror for each Class A Share, Class B Share and ADS at the price of US$l.5714, US$1.5714 and US$22.00 respectively. The Merger was approved by the Company's shareholders and CMGE's shareholder at their respective extraordinary meetings held on 16 July 2015 and 27 July 2015, respectively. On 11 August 2015, the Company further announced that the Merger had completed on 10 August 2015, which resulted in CMGE ceasing to be a subsidiary of the Company. Following that the Group's mobile games business has discontinued since then. For details of the Merger, please refer to the very substantial disposal circular of the Company dated 30 June 2015 in relation to the Merger.



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