Financial

2011 Annual Report

Summary

Tencent Holdings’ 2011 financial year was marked by a sharp expansion of its core internet platform, with consolidated revenues rising 45 % to RMB 28.5 billion and operating profit increasing 24.6 % to RMB 12.3 billion. The growth was driven primarily by internet value‑added services (IVAS) and mobile telecommunications services, which together accounted for 80 % of sales. Online gaming revenue surged 66 %, propelled by flagship titles such as *Cross Fire* and *League of Legends*, while social networking platforms—QQ.com, Qzone, Pengyou and Tencent Microblog—expanded user bases to 373 million registered users and 68 million daily active users. Total assets doubled from RMB 35.8 billion to RMB 56.8 billion, largely due to a jump in current assets and non‑current investments, including significant equity stakes in eLong, Kingsoft and other associates. Capital expenditures more than doubled to RMB 4.16 billion, reflecting investment in infrastructure and acquisitions such as Riot Games and Gamegoo, which generated goodwill of RMB 3.8 billion. Net profit attributable to equity holders rose 26.7 % to RMB 10.2 billion, with earnings per share reaching RMB 5.61 basic. Governance remained robust: the board met quarterly, retained a majority of non‑executive directors and three independent members, and maintained COSO‑based internal controls with no material deficiencies. Share‑based compensation expanded markedly—over 7 million options exercised and a share award pool of nearly 16 million shares outstanding—while dividend policy remained conservative with a final dividend of HKD 0.75 per share. Geographically, operations were concentrated in China through subsidiaries such as Tencent Computer and Tencent Technology, with the group’s legal domicile in the Cayman Islands and listing on Hong Kong. The period covered 2011, with a focus on internet services, mobile telecommunications, online gaming and advertising within the Chinese market.

From the report

Tencent ifl Tencent Holdings Limited Incorporated in the Cayman Islands with limited liability FEBA B (Stock Code 1700) QQ.com Q smart communication inspires 2011 EPE ANNUAL REPORT

Contents Corporate Information 2 Financial Summary 3 Chairman’s Statement 4 Management Discussion and Analysis 11 Directors’ Report 27 Corporate Governance Report 54 Independent Auditor’s Report 70 Consolidated Statement of Financial Position 72 Statement of Financial Position - The Company 75 Consolidated Income Statement 77 Consolidated Statement of Comprehensive Income 79 Consolidated Statement of Changes in Equity 80 Consolidated Statement of Cash Flows 84 Notes to the Consolidated Financial Statements 86 Definitions 189 Tencent Holdings Limited Annual Report 2011 1

Corporate Information DIRECTORS Definition NOMINATION COMMITTEE PRINCIPAL PLACE OF BUSINESS Executive Directors Ma Huateng (Chairman) IN HONG KONG Ma Huateng (Chairman) Charles St Leger Searle Room 3002, 30th Floor short message service Lau Chi Ping Martin Li Dong Sheng Far East Finance Centre "SNS" Iain Ferguson Bruce 16 Harcourt Road Zhang Zhidong "Stock Exchange" Ian Charles Stone Hong Kong The Stock Exchange of Hong Kong Limited Non-Executive Directors "TCS CFC" REMUNERATION COMMITTEE CAYMAN ISLANDS PRINCIPAL Antonie Andries Roux Tencent Technology and Tencent Computer SHARE REGISTRAR AND Charles St Leger Searle Antonie Andries Roux (Chairman) TRANSFER OFFICE "TcS Co-operation Li Dong Sheng Committee" Ian Charles Stone Butterfield Fulcrum Group (Cayman) Independent Non-Executive Directors Tencent Technology (Beijing) Company Limited Limited Li Dong Sheng AUDITOR Butterfield House 68 Fort Street, P.O. Box 609 Iain Ferguson Bruce PricewaterhouseCoopers Grand Cayman KY1-1107 Ian Charles Stone Certified Public Accountants Cayman Islands AUDIT COMMITTEE PRINCIPAL BANKER HONG KONG BRANCH SHARE Iain Ferguson Bruce (Chairman) The Hongkong and Shanghai REGISTRAR AND TRANSFER Ian Charles Stone Banking Corporation Limited OFFICE Charles St Leger Searle REGISTERED OFFICE Computershare Hong Kong Investor CORPORATE GOVERNANCE Services Limited COMMITTEE Cricket Square Shops 1712-1716, 17th Floor Hutchins Drive, P.O. Box 2681 Hopewell Centre Antonie Andries Roux (Chairman) Grand Cayman KY 1-1111 183 Queen’s Road East Iain Ferguson Bruce Cayman Islands Wan Chai, Hong Kong

utershare Hong Kong Investor CORPORATE GOVERNANCE Services Limited COMMITTEE Cricket Square Shops 1712-1716, 17th Floor Hutchins Drive, P.O. Box 2681 Hopewell Centre Antonie Andries Roux (Chairman) Grand Cayman KY 1-1111 183 Queen’s Road East Iain Ferguson Bruce Cayman Islands Wan Chai, Hong Kong Ian Charles Stone HEAD OFFICE AND PRINCIPAL COMPANY WEBSITE INVESTMENT COMMITTEE PLACE OF BUSINESS www.tencent.com Lau Chi Ping Martin (Chairman) Tencent Building Ma Huateng Kejizhongyi Avenue STOCK CODE Zhang Zhidong Hi-tech Park 700 Antonie Andries Roux Nanshan District Charles St Leger Searle Shenzhen, 518057 The PRC 2 Tencent Holdings Limited Annual Report 2011

Financial Summary CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME "Model Code" Year ended 31 December 2007 2008 2009 2010 2011 in Appendix 10 to the Listing Rules RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 Revenues 3,820,923 7,154,544 12,439,960 19,646,031 28,496,072 Gross profit 2,703,366 4,984,123 8,550,492 13,325,831 18,567,764 Profit before income Shijitianyou Technology Company Limited, Guangzhou Yunxun, Shenzhen Dadi tax 1,534,503 3,104,895 6,040,731 9,913,133 12,099,069 Tongtu Information Technology Limited, Shenzhen Shiji Huixiang Technology Profit for the year 1,568,008 2,815,650 5,221,611 8,115,209 10,224,831 Profit attributable to equity holders Shenzhen Xinghuo Chuangxin Technology Company Limited and Shenzhen of Company Xingguang Tongchuang Technology Company Limited the 1,566,020 2,784,577 5,155,646 8,053,625 10,203,083 "Nomination Committee" the nomination committee of the Company Total comprehensive income for the year 1,568,008 2,815,650 5,221,611 9,936,338 8,956,702 Total comprehensive income attributable to equity holders of the Company 1,566,020 2,784,577 5,155,646 9,874,754 8,937,627 CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION As at 31 December 2007 2008 2009 2010 2011 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Restated) Assets Non-current assets 2,090,312 3,359,696 4,348,823 10,456,373 21,300,877 Current assets 4,835,132 6,495,861 13,156,942 25,373,741 35,503,488 Total assets 6,925,444 9,855,557 17,505,765 35,830,114 56,804,365 Equity and liabilities Equity attributable to the Company’s equity holders 5,170,396 7,020,926 12,178,507 21,756,946 28,463,834 Non-controlling interests 64,661 98,406 120,146 83,912 624,510

95,861 13,156,942 25,373,741 35,503,488 Total assets 6,925,444 9,855,557 17,505,765 35,830,114 56,804,365 Equity and liabilities Equity attributable to the Company’s equity holders 5,170,396 7,020,926 12,178,507 21,756,946 28,463,834 Non-controlling interests 64,661 98,406 120,146 83,912 624,510 Total equity 5,235,057 7,119,332 12,298,653 21,840,858 29,088,344 Non-current liabilities 40,770 644,628 644,033 967,211 6,532,673 Current liabilities 1,649,617 2,091,597 4,563,079 13,022,045 21,183,348 Total liabilities 1,690,387 2,736,225 5,207,112 13,989,256 27,716,021 Total equity and liabilities 6,925,444 9,855,557 17,505,765 35,830,114 56,804,365 Tencent Holdings Limited Annual Report 2011 3

Pages: 194
Words: 66,701
Type: Financial

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