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ChinaNet Online Holdings Reports Fourth Quarter and Full Year 2012 Financial Results
Summary Financials
| Fourth Quarter 2012 Results (USD) (Unaudited) | |||
| Q4 2012 | Q4 2011 | CHANGE | |
| Sales |
|
|
+34% |
| Gross Profit |
|
|
+60% |
| Gross Margin | 57.7% | 49.0% | +18% |
| Net Income Attributable to Common Stockholders |
|
- |
N/A |
| Adjusted Net Income Attributable to Common Stockholders | $1.4 million(1) | -$1.8 million(2) | N/A |
| EPS (Diluted) |
|
- |
N/A |
| Adjusted EPS (Diluted) | $0.06(1) | -$0.08(2) | N/A |
(1) Non-GAAP adjusted net income attributable to common stockholders and EPS excludes
(2) Non-GAAP adjusted net income attributable to common stockholders and EPS excludes: (1)
Fourth Quarter 2012 Financial Results
Revenues increased by
Mr.
| Fourth Quarter 2012 Revenue Breakdown by Business Unit (USD in thousands) | |||||
| Q4 2012 | % | Q4 2011 | % | % Change | |
| Internet Advertisement |
|
73% |
|
57% | +70% |
| TV Advertisement |
|
8% |
|
27% | -58% |
| Bank Kiosk |
|
1% |
|
1% | -6% |
|
Brand Mgmt. & |
|
18% |
|
14% | +66% |
Revenue from Internet advertisements for the three months ended
Gross profit for the three months ended
Operating expenses for the three months ended
The Company had
Net income attributable to common stockholders for the three months ended
Non-GAAP adjusted net income attributable to common stockholders for the three months ended
| Full Year 2012 Results (USD) | |||
| FY 2012 | FY 2011 | CHANGE | |
| Sales |
|
|
+62% |
| Gross Profit |
|
|
-10% |
| Gross Margin | 32.3% | 58.1% | -44% |
| Net Income Attributable to Common Stockholders |
|
|
+15% |
| Adjusted Net Income Attributable to Common Stockholders | $3.2 million(1) | $4.5 million(2) | -31% |
| EPS (Diluted) |
|
|
0% |
| Adjusted EPS (Diluted) | $0.14(1) | $0.24(2) | -42% |
(1) Non-GAAP adjusted net income attributable to common stockholders and EPS exclude a $0.2 million non-cash charge of the changes in fair value of the contingent consideration receivables for the year ended
(2) Non-GAAP adjusted net income attributable to common stockholders and EPS excludes: (1)
|
Year Ended |
|||||
| FY 2012 | % | FY 2011 | % | % Change | |
| Internet Advertisement |
|
46% |
|
70% | +7% |
| TV Advertisement |
|
44% |
|
22% | +218% |
| Bank Kiosk |
|
1% |
|
2% | -42% |
|
Brand Mgmt. & |
|
10% |
|
6% | +146% |
Net revenues for the year ended
Total cost of revenues increased to
Gross profit for the year ended
Operating expenses for the year ended
Operating income for the year ended
GAAP net income attributable to common stockholders for the fiscal year 2012 was
Balance Sheet and
The Company had
The Company generated
Guidance for 2013
Management anticipates to release the revenues and net income guidance for fiscal year 2013 in
Business Updates
Liansuo.com, the Company's subsidiary, signed an agreement to help Super 8
| Conference Call | |
| Date: |
|
| Time: |
|
| Conference Line (U.S.): | 1-877-317-6776 |
| International Dial-In: | 1-412-317-6776 |
| Conference ID: | 10027127 |
| Webcast: | http://webcast.mzvaluemonitor.com/Cover.aspx?PlatformId=1071 |
A power point presentation will be available for downloading on the date of the conference call on
Please dial in at least 10 minutes before the call to ensure timely participation.
A playback of the call will be available until
About
About Non-GAAP Financial Measures
To supplement the audited consolidated statement of income and comprehensive income presented in accordance with GAAP, we are also providing non-GAAP measures of income from operations, income before income tax expenses, net income, net income attributable to us, net income attributable to our common stockholders and basic and diluted earnings per share for the year ended
The following table presents reconciliations of our non-GAAP financial measures to the audited consolidated statements of income and comprehensive income for the years ended
|
Year Ended |
||||||
| 2012 | 2011 | |||||
| GAAP | NON GAAP | GAAP | NON GAAP | |||
| US$ | US$ | US$ | US$ | |||
| Gross Profit |
|
|
|
|
||
| Operating expenses | ||||||
| Selling expenses | 2,683 | 2,683 | 3,506 | 2,827 | ||
| General and administrative expenses | 6,030 | 6,030 | 7,904 | 6,647 | ||
| Research and development expenses | 1,819 | 1,819 | 2,132 | 1,461 | ||
| 10,532 | 10,532 | 13,542 | ||||
| 10,935 | ||||||
| Income from operations | 4,510 | 4,510 |
|
|||
| Adjusted income from operations |
|
|||||
| Other income (expenses): | ||||||
| Changes in fair value of contingent consideration receivables | (160) | -- | (70) | -- | ||
| Interest income | 186 | 186 | 13 | 13 | ||
| Gain on deconsolidation of subsidiaries | -- | -- | 925 | -- | ||
| Other (expenses) income | (150) | (150) | 5 | 5 | ||
| (124) | 873 | |||||
| 36 | 18 | |||||
| Income before income tax expense, equity method investments and noncontrolling interests | 4,386 | 4,035 | ||||
| Adjusted income before income tax expense, equity method investments and noncontrolling interests | 4,546 | 5,787 | ||||
| Income tax expense | 529 | 529 | 1,035 | 827 | ||
| Income before equity method investments and noncontrolling interests | 3,857 | 3,000 | ||||
| Adjusted income before equity method investments and noncontrolling interests | 4,017 | 4,960 | ||||
| Share of losses in equity investment affiliates | (449) | (449) | (219) | (219) | ||
| Net income | 3,408 | 2,781 | ||||
| Adjusted net income | 3,568 | 4,741 | ||||
| Net (income) loss attributable to noncontrolling interest | (412) | (412) | 214 | 214 | ||
|
Net income attributable to |
2,996 | 2,995 | ||||
|
Adjusted net income attributable to |
3,156 | 4,955 | ||||
| Dividend for series A convertible preferred stock | -- | -- | (407) | (407) | ||
|
Net income attributable to common shareholders of |
|
|
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|
Adjusted net income attributable to common shareholders of |
|
|
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| Earnings per common share-Basic |
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| Adjusted earnings per common share-Basic |
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| Earnings per common share-Diluted |
|
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| Adjusted earnings per common share-Diluted |
|
|
||||
| Weighted average number of common shares outstanding: | ||||||
| Basic | 22,185,556 | 22,185,556 | 18,545,609 | 18,545,609 | ||
| Diluted | 22,185,556 | 22,185,556 | 18,759,240(1) | 20,384,766(2) | ||
|
(1) For the year ended |
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|
(2) For the year ended |
||||||
Safe Harbor
This release contains certain "forward-looking statements" relating to the business of
|
|
||
| CONSOLIDATED BALANCE SHEETS | ||
| (In thousands, except for number of shares) | ||
|
As of |
||
| 2012 | 2011 | |
| (US $) | (US $) | |
| Assets | ||
| Current assets: | ||
| Cash and cash equivalents |
|
|
| Term deposit | 3,357 | -- |
| Accounts receivable, net | 8,486 | 4,444 |
| Other receivables, net | 3,103 | 3,631 |
| Prepayment and deposit to suppliers | 14,596 | 15,360 |
| Due from related parties | 210 | 324 |
| Contingent consideration receivables | -- | 159 |
| Other current assets | 136 | 129 |
| Deferred tax assets-current | 50 | -- |
| Total current assets | 35,421 | 34,742 |
| Investment in and advance to equity investment affiliates | 959 | 1,396 |
| Property and equipment, net | 1,636 | 1,902 |
| Intangible assets, net | 7,167 | 8,151 |
| Goodwill | 11,083 | 10,999 |
| Deferred tax assets-non current | 652 | 92 |
| Total Assets |
|
|
| Liabilities and Equity | ||
| Current liabilities: | ||
| Accounts payable |
|
|
| Advances from customers | 1,065 | 724 |
| Accrued payroll and other accruals | 904 | 616 |
| Due to equity investment affiliate | -- | 220 |
| Due to related parties | -- | 161 |
| Payable for acquisition | 1,266 | 550 |
| Taxes payable | 6,683 | 5,040 |
| Other payables | 217 | 114 |
| Dividend payable | -- | 5 |
| Total current liabilities | 10,245 | 7,698 |
| Long-term liabilities: | ||
| Deferred tax liability-non current | 1,689 | 1,893 |
| Long-term borrowing from director | 139 | 137 |
| Total Liabilities | 12,073 | 9,728 |
| Commitments and contingencies | ||
| Equity: | ||
|
|
||
|
Common stock ( |
||
| 22 | 22 | |
| Additional paid-in capital | 20,008 | 20,747 |
| Statutory reserves | 2,296 | 2,117 |
| Retained earnings | 19,505 | 16,688 |
| Accumulated other comprehensive income | 2,393 | 2,132 |
|
|
44,224 | 41,706 |
| Noncontrolling interests | 621 | 5,848 |
| Total equity | 44,845 | 47,554 |
| Total Liabilities and Equity |
|
|
|
|
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| CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME | ||
| (In thousands, except for number of shares and per share data) | ||
|
Year Ended |
||
| 2012 | 2011 | |
| (US $) | (US $) | |
| Sales | ||
| From unrelated parties |
|
|
| From related parties | 197 | 626 |
| 46,600 | 28,731 | |
| Cost of sales | 31,558 | 12,027 |
| Gross margin | 15,042 | 16,704 |
| Operating expenses | ||
| Selling expenses | 2,683 | 3,506 |
| General and administrative expenses | 6,030 | 7,904 |
| Research and development expenses | 1,819 | 2,132 |
| 10,532 | 13,542 | |
| Income from operations | 4,510 | 3,162 |
| Other income (expenses) | ||
| Changes in fair value of contingent consideration receivables | (160) | (70) |
| Interest income | 186 | 13 |
| Gain on deconsolidation of subsidiaries | -- | 925 |
| Other (expenses)/income | (150) | 5 |
| (124) | 873 | |
| Income before income tax expense, equity method investments and noncontrolling interests | 4,386 | 4,035 |
| Income tax expense | 529 | 1,035 |
| Income before equity method investments and noncontrolling interests | 3,857 | 3,000 |
| Share of losses in equity investment affiliates | (449) | (219) |
| Net income | 3,408 | 2,781 |
| Net (income) / losses attributable to noncontrolling interests | (412) | 214 |
|
Net income attributable to |
2,996 | 2,995 |
| Dividend of Series A convertible preferred stock | -- | (407) |
|
Net income attributable to common stockholders of |
|
|
| Net income | 3,408 | 2,781 |
| Foreign currency translation gain | 267 | 1,254 |
| Comprehensive Income |
|
|
| Comprehensive (income) / losses attributable to noncontrolling interests | (418) | 162 |
|
Comprehensive income attributable to |
|
|
| Earnings per share | ||
| Earnings per common share | ||
| Basic |
|
|
| Diluted |
|
|
| Weighted average number of common shares outstanding: | ||
| Basic | 22,185,556 | 18,545,609 |
| Diluted | 22,185,556 | 18,759,240 |
|
|
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| CONSOLIDATED STATEMENTS OF CASH FLOWS | ||
| (In thousands) | ||
|
Year Ended |
||
| 2012 | 2011 | |
| (US $) | (US $) | |
| Cash flows from operating activities | ||
| Net income |
|
|
| Adjustments to reconcile net income to net cash provided by operating activities | ||
| Depreciation and amortization | 1,637 | 1,012 |
| Share-based compensation expenses | 48 | 2,900 |
| Changes in fair value of contingent consideration receivables | 160 | 70 |
| Allowances for doubtful debts | 1,141 | 2,583 |
| Share of losses in equity investment affiliates | 449 | 219 |
| Gain on deconsolidation of subsidiaries | -- | (925) |
| Loss / (gain) on disposal of property and equipment | 2 | (3) |
| Deferred taxes | (828) | 27 |
| Changes in operating assets and liabilities | ||
| Accounts receivable | (5,516) | (2,100) |
| Other receivables | 1,400 | 5,276 |
| Prepayment and deposit to suppliers | 882 | (11,247) |
| Due from related parties | 117 | (130) |
| Other current assets | (5) | (197) |
| Accounts payable | (158) | 27 |
| Advances from customers | 335 | (1,575) |
| Accrued payroll and other accruals | 285 | 166 |
| Due to director | -- | (559) |
|
Due to |
-- | (82) |
| Due to related parties | (4) | (139) |
| Other payables | 72 | 490 |
| Taxes payable | 1,603 | 803 |
| Net cash provided by (used in) operating activities | 5,028 | (603) |
| Cash flows from investing activities | ||
| Purchases of vehicles and office equipment | (314) | (741) |
| Purchase of intangible assets | -- | (1,445) |
| Short-term loan to unrelated entities | (475) | -- |
| Project development deposit to a third party | (2,453) | -- |
| Refund of project development deposit from a third party | 2,453 | -- |
| Cash from acquisition of VIEs | -- | 330 |
| Cash effect on deconsolidation of VIEs | -- | (1,670) |
| Long-term investment in and advance to equity investment affiliates | -- | (1,712) |
| Disposal of investment in and loan repayment from equity investment affiliate | -- | 8,885 |
| Payment for acquisition of VIEs | (5,775) | (9,731) |
| Placement of term deposit | (3,355) | -- |
| Net cash used in investing activities | (9,919) | (6,084) |
| Cash flows from financing activities | ||
| Cash investment contributed by noncontrolling interests | -- | 378 |
| Dividend paid to convertible preferred stockholders | (5) | (657) |
| Short-term loan borrowed from an equity investment affiliate | 316 | 216 |
| Short-term loan repaid to an equity investment affiliate | (538) | -- |
| Repayment to legal (nominal) shareholders of Shanghai Jing Yang | (158) | -- |
| Capital contributions received in advance from new shareholders of Zhao Shang Ke Hubei before deconsolidation | -- | 1,545 |
| Net cash (used in) provided by financing activities | (385) | 1,482 |
| Effect of exchange rate fluctuation on cash and cash equivalents | 64 | 310 |
| Net decrease in cash and cash equivalents | (5,212) | (4,895) |
| Cash and cash equivalents at beginning of the year | 10,695 | 15,590 |
| Cash and cash equivalents at end of the year |
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CONTACT:Source:MZ North America Ted Haberfield, President Direct: +1-760-755-2716 Email: thaberfield@mzgroup.us Web: www.mzgroup.us
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