A8 New Media : ANNOUNCEMENT OF THE ANNUAL RESULTS FOR THE YEAR ENDED 31 DECEMBER 2018

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A8 New Media Group Limited

A8新媒體集團有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 800)

ANNOUNCEMENT OF THE ANNUAL RESULTS

FOR THE YEAR ENDED 31 DECEMBER 2018

FINANCIAL HIGHLIGHTS

•Revenue of the Group for 2018 amounted to approximately RMB151.8 million, representing an increase of approximately 9.1% as compared with 2017 (2017: approximately RMB139.1 million).

•Loss for 2018 of the Group amounted to approximately RMB90.5 million, as compared with a profit of approximately RMB25.0 million in 2017.

•The profit margin ratio of the Group was approximately 44.7% for 2018, which decreased 3.2 percentage point as compared to that of 2017, while it was approximately 47.9% for 2017.

•Strong balance sheet with cash and bank balance and highly liquid short term assets of approximately RMB601.8 million.

The board of directors (the "Board") of A8 New Media Group Limited (the "Company") announces the consolidated results of the Company and its subsidiaries (collectively referred to as the "Group") for the year ended 31 December 2018. The results have been reviewed by the Audit Committee of the Company, comprising all the independent non-executive Directors.

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BUSINESS REVIEW FOR 2018

In 2018, driven by games and film & television industries, the scale of China's pan- entertainment core industry continued to grow. Based on The White Book on 2017-2018Pan-entertainment Industry Ecosystem in PRC published by Analysys, the industrial scale is estimated to reach RMB702.9 billion, an increase of 17.5% over 2017. With the increase of Intellectual Property ("IP") linkage, the content of single work gradually deepened, the overall value of IP was enlarged through full copyright linkage. This trend also activate incremental users for the market and occupy users' time through multi-form content. In the future, the pan- entertainment industry will continue to maximize IP value through different IP forms, in order to achieve sustainable and multi-channel monetization.

In 2018, the Group kept developing in the industry chain of pan-entertainment field. The Group continued creating new IP contents, associate with the resource in each of the business segments, so as to develop prime IP contents. The following is a review of the development in various business segments of the Group:

FILM & TELEVISION PRODUCTION

The Group's wholly-owned subsidiary, Jisu Woniu Film & Television Media (Shenzhen) Co., Limited (極速蝸牛影視傳媒（深圳）有限公司, "A8 Film & Television"), was established in 2017 and is principally engaged in the business of producing web dramas, videos and films.

Web Drama"Matchmaker of Great Zhou Dynasty" Completed Shooting

"Matchmaker of Great Zhou Dynasty" (「大周小冰人」), the lightly funny idol costume drama jointly developed and produced by A8 Film & Television and iQIYI, Inc. ("iQIYI"), was online in March 2019 on iQIYI. "Matchmaker of Great Zhou Dynasty" is the top ten IP customized web drama of the iQIYI "Yunteng Scheme" (「雲騰計劃」).

Investment in Lanlanlanlan Film & Television

Up to 31 December, 2018, the Group held 29.52% share in Lanlanlanlan Film & Television Media (Tianjin) Co., Ltd. ( 藍藍藍藍影視傳媒（天津）有限公司, "Lanlanlanlan Film & Television") in aggregate through capital increase, share acquisition and performance compensation. Lanlanlanlan Film & Television is an associate of the Company. It mainly engages in the business of script writing, script selling, script adaptation, production of web series, TV series, cinema movies, web movies and related businesses. It hired over 100 screenwriters and is currently one of the largest domestic screenwriter team. The large screenwriter teams enable Lanlanlanlan Film & Television to substantially shorten the script production cycle in an efficient and effective manner and has the experience and ability to mass-produce web dramas.

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GAME BUSINESS

In February 2018, the Group acquired 51% equity interest of independent game research and development companies, Shanghai Mu77 Network Technology Co., Ltd. (上海木七七網絡 科技有限公司, "MU77SH") and Mu77 Network Technology Hongkong Limited ( 香港木 七七網絡科技有限公司, "MU77HK") (collectively "Mu77"). Mu77 is mainly engaged in the research, development and operation of independent games. It won the honor of "Alibaba Game Eco Top Ten Creative Manufacturers" in 2018. Mu77's self-developed product "Card Monster" 「( 卡片怪獸」) continued to operate jointly with Tencent Aurora platform in mainland China, and maintained at the top 30 on the Best-selling List of WeChat games. In overseas regions, this product was continuously recommended by iOS and Google Play. The game's annual revenue maintained a steady upward trend.

Miniatures game project "Colossus Knights" (「 巨 像 騎 士 團 」) was initiated in 2018. By simplifying the operation Mu77 expected that this miniatures game could better fit the operating experience on the mobile side. At present, the project is under early demo testing on the TapTap platform, and has received over 20,000 subscribers and gained a 9.0 user rating. The project is expected to be commercialized in 2019. In 2018, Mu77 also launched game projects "Immortal Chat Group" 「( 修真聊天群」) and "Adventure and Dragon Training" 「( 冒 險與馴龍」, temporary name). The Group joint created and developed these two games with China Mobile Games and Entertainment Group Limited ("CMGE") and Unicorn Games.

Finger Fun, the Group's game distribution platform, continued to focus on the publication of products in sub-areas.In 2018, Finger Fun mainly published "Making Soldiers in Three Kingdoms" 「( 造兵三國」), "Three Kingdoms Wars M" 「( 三國志大戰M」), "Werewolf Killers" 「( 狼人殺」) and "Xiawuyu" 「( 俠物語」).

CULTURAL INDUSTRY PARK - NATIONAL MUSIC INDUSTRY PARK - A8 MUSIC BUILDING

A8 Music Building is the National Music Industry Park. It is located in the core area of Shenzhen Bay area in Nanshan District, Shenzhen, next to Shenzhen Software Industrial Park, close to Qianhai 「( 前海」) and Houhai 「( 後海」), and has a superior location. The total gross floor area is more than 50,000 sq.m which includes commercial office, podium commercial property and parking lots. In 2018, A8 Music Building won the first prize in "Shenzhen Excellent Property Management Project" 「( 深圳市優秀物業管理優秀項目」) awarded by Shenzhen Property Management Industry Association. The property investment business of A8 Music Building has been re-designated as the main business of the Group since mid-2015. A8 Music Building has generated an overall income of approximately RMB74,600,000 in 2018, representing an increase of approximately 14.3% as compared to the same period of last year.

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Furthermore, offline live music performance brand A8Live is operated together with the LiveHouse Theater located in the podium of the A8 Music Building, its business functions include live music performance, maker café, professional studio, band rehearsal rooms and music education center. A8Live has held more than 200 performance activities in 2018 in diversified activity forms such as artists performance, band shows, concerts, fans meeting, press releases, charitable activities and live broadcasts, etc. Artists being invited to A8Live are becoming more international, including well-known artists and bands such as Declan Galbraith, Wuwuhui, Huang Ling, Dingdang, Huang Qishan and the like. Going forward, celebrities having performances in venues such as LiveHouse will become a trend. Interactive performance with short distance will be a selling point for LiveHouse to attract audience. By handling such performance activities, A8Live team has accumulated extensive experience. The enhanced brand will facilitate the subsequent exploration of the operation of LiveHouse to a larger extent.

ONLINE LITERATURES - BEIJING ZHANGWEN

The associate of the Group, 北京掌文信息技術有限公司 (Beijing Zhangwen Information Technology Co., Ltd.) ("Beijing Zhangwen"), operates Heiyan.com ( 黑岩網), one of the largest domestic single suspense-style literatures platforms, Ruochu.com ( 若 初 網 ), the platform mainly for women's romance literatures, Ruoxia.com (若夏網), the platform mainly for ancient-style literatures, and Lemon Read (檸檬免費小說). Beijing Zhangwen is mainly engaged in the incubation and operation of IP, provision of online paid-to-read service, and licensing adaptation of literatures to mobile games, web dramas, television dramas and movies, cartoons, comics and audio works.

Stable development in own platform business and rapid growth in third-party distribution business

By the end of 2018, the cumulative number of registered users of Beijing Zhangwen had exceeded 29 million, maintaining approximately an average compound annual growth rate of 40% over the past four years. The quality content of its own platforms has continued to expand and cumulatively published more than 115,000 works. It represented an increase of approximately 20% over the previous year in terms of number of works.

In 2018, the third-party distribution business has grown rapidly. With the original distribution channels such as China Literature 「( 閱文集團」), Ali Literature 「( 阿里文學」), iReader 「( 掌 閱文學」), Chasing Artifacts 「( 追書神器」), Zhongheng Literature 「( 縱橫文學」), Baidu Cloud 「( 百度雲」), Migu Culture 「( 咪咕文化」) in hand, Beijing Zhangwen continued to expand new distribution channels. In 2018, Beijing Zhangwen's innovative operation mode of its non- serial IP won the first battle. "Jiangliao" 「( 姜了」) achieved more than 10 million readings soon after getting online in Toutiao.

Sustainable and steady development in content licensing business

Beijing Zhangwen made a major breakthrough in the licensing of audio works. In 2018, Beijing Zhangwen's work occupied the first place on the Himalayan FM (「喜馬拉雅FM」)'s Pay-to-listen List and Free-to-listen List. Some of the audio works from Beijing Zhangwen entered the top ten of Lazy People Listening (「懶人聽書」）'s Hot Search List and Dragonfly FM (「蜻蜓FM」)'s Completion Reading List. The success of the audio works further broadened the monetization channels of the online literature IPs of Beijing Zhangwen.

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In terms of IP literature licensing to films & televisions, Beijing Zhangwen cooperated with around 60 works in aggregate up to now. The ancient web drama "Shaoqing's Pet Life in Dali Temple" 「( 大理寺少卿的寵物生活」) jointly created by Beijing Zhangwen and tv.sohu.com (搜狐視頻) went on line in September 2018. Up to the date of this announcement, the number of view have exceeded 140 million. At the same time, Beijing Zhangwen and iQIYI "Yunteng Scheme" have three authorized works, one of which is a first-class work.

BUSINESS OUTLOOK FOR 2019

In 2019, the Group will continue to create prime IP and promote the circulation and interaction of IP among different product forms, and further explore the value of customers to meet their needs.

FILM & TELEVISION PRODUCTION

In 2019, the Group's film & television business will continually take premium literature IP as the starting point to develop film and television projects.

GAME BUSINESS

In 2019, the Group will maintain a stable proportion of self-research projects and customized projects in the follow-up game product planning, in order to ensure a steady increase in income level. Two customized games:"Immortal Chat Group" (「修真聊天群」) costomized for CMGE and "Adventure and Dragon Training" (「冒險與馴龍」) comstomized for Unicorn Games, and one self - research game "Colossus Knights" (「巨像騎士團」) are all expected to get on line in 2019.

CULTURAL INDUSTRY PARK - NATIONAL MUSIC INDUSTRY PARK - A8 MUSIC BUILDING

In 2019, the Group will continue to enhance the property management level and provide better service for clients, in order to receive consistent and stable income. At the same time, the Company will be dedicated in moving forward the development of A8Live towards its branding and content making. We will continue to expand performance business and reinforce branding promotion and industrial influence.

ONLINE LITERATURES - BEIJING ZHANGWEN

In 2019, while continuing to consolidate its dominance in the suspense themes, Beijing Zhangwen will enhance the research and development of the new themes and contents. Meanwhile, Beijing Zhangwen will also vigorously develop distribution of online literature business and the comic distribution platform. Through the multi-way development of suspense-style literatures, it can fully utilize the advantage of the traffic from the existing literature platform, Heiyan.com.

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