BEIJING, Nov. 21, 2011 /PRNewswire-Asia-FirstCall/ --
China Mass Media Corp. ("China Mass Media" or the "Company") (NYSE:
CMM), a leading television advertising company in China, today announced its unaudited financial
results for the third quarter ended September 30, 2011.
Third Quarter 2011 Highlights:
- Total net revenues were RMB57.5
million (US$9.0 million), an
increase of 5.1% from the third quarter of 2010 and an increase of
11.3% from the second quarter of 2011.
- Operating income was RMB16.9
million (US$2.6 million), an
increase of 35.1% from RMB12.5
million in the third quarter of 2010 and an increase of
17.7% from the second quarter of 2011.
- Net income was RMB14.0 million
(US$2.2 million), an increase of
117.8% from RMB6.43 million in the
third quarter of 2010 and an increase of 24.8% from the second
quarter of 2011.
- Net cash outflows from operating activities were RMB158.3 million (US$24.8
million), compared to RMB54.5
million net cash inflows in the third quarter of 2010 and
RMB12.8 million net cash outflows in
the second quarter of 2011.
Mr. Shengcheng Wang, Chairman and Chief Executive Officer of
China Mass Media, commented, "Our third quarter revenue and net
profit increased from both the second quarter of 2011 and the third
quarter of 2010, primarily due to receiving RMB14.7 million (US$2.3
million) as service fee from China Central Television
('CCTV') for the Company's services in advertising and promotional
activities in connection with the Beijing Olympic Games in 2008.
Because of CCTV's slow internal examination and approval
procedures, this service fee, which should have been received in
the first quarter 2010, was paid to us in the third quarter of
2011.
"Our third quarter revenues from advertising agency services
decreased from the previous quarter as well as from the third
quarter of 2010. Although the sales rates increased significantly
from the third quarter of 2010, sales revenues declined compared
with the previous quarter and the third quarter of 2010, as a
result of more discounts given to clients in light of fierce market
competition and increasing media costs. July and August are weak
seasons for the traditional advertising market. However, the
market picked up in September and customer demands for advertising
increased significantly. We were pleased that advertising time
slots of our 'Periodic China News Package' on CCTV-4 were all sold
out in September.
"Our advertising production services have been showing good
momentum. In the third quarter we successfully produced a number of
commercials for clients, including Xiwang
Sugar and the Beijing Economic and Technological Development
Zone Management Committee. Still, third quarter revenues from
advertising and creative production decreased compared with the
previous quarter and the third quarter of 2010 because of the lower
average price charged to customers during the quarter. In addition,
due to program changes at CCTV in June
2011, our contracts with CCTV for the production of the TV
program 'Guang Er Gao Zhi' was terminated. Thus, beginning
with the third quarter, the Company no longer generates revenue
from sponsorship services. This led to the decline in revenues
compared with the previous quarter and the third quarter of
2010.
"In addition to advertising agency services, content production
has become an important component of our development strategy. In
the third quarter, we had achieved a number of new developments in
our new film and TV production business. The Company completed the
scripts of two TV plays, and entered into filming stages. We expect
the filming of one of the plays to be completed by the end of this
year, and the post-production to be completed by the first quarter
of 2012. We are actively in discussion with major television
stations regarding the distribution plans.
"Television is still considered by advertisers to be the best
and largest media platform in China. Following the recently closed 2012
Annual Prime Time Advertising Resources Auction at CCTV, the sales
of these advertising resources reached a record of RMB14.26 billion, a 12.5% increase from the
RMB12.67 billion in the previous
year. The alcohol, finance and food and beverage industries
were the top three contributors. We actively participated in
this auction as the agent for Sanyo Electric, enlisting our
professional services to help them obtain the best resources. We
plan to continue our advertising agency services for the 'Periodic
China News Package' on CCTV-4 in 2012. In addition, we recently
acquired a 60-second time slot in connection with the 'All Day
Classic Package' on CCTV-8 starting from 2012. CCTV-8 is the only
national TV drama series channel in China. It ranks third among all channels in
China in terms of audience share
in 2009 according to 2010 China TV & Radio Yearbook, and is
ideal for advertising family consumer products. The "All Day
Classic Package" broadcasts 14 times per day, and covers all time
slots from morning to evening on CCTV-8, which had a cumulative
rating of 2.69% according to our own statistics in the first three
quarters of 2011. In the following months, we will focus on
presales of 2012 advertising resources to lock-in clients in
advance.
"Net cash outflows in the third quarter were largely due to the
settling of outstanding payables to CCTV in relation to the media
fees for the 'Daytime Advertising Package' and 'Television Guide
Package' for the year ended December
31, 2009."
Julie Sun, our Chief Financial
Officer, added, "The Company declared a special cash dividend of
US$0.07667 per share on the Company's
ordinary shares on October 28, 2011.
For further details of the special cash dividend
distribution, please see the Company's announcement published on
October 28, 2011. As a result
of this special cash dividend distribution, an unrecognized
withholding tax of over RMB10 million
(US$1.6 million) will be provided in
our fourth quarter, which will have a significant adverse effect to
our fourth quarter financial results."
Third Quarter 2011 Financial Results
Revenues
Revenues from advertising agency services were
RMB43.4 million (US$6.8 million), including RMB3.5 million (US$0.55
million) of revenue resulting from a reduction of media fees
for a program that we recognize revenue on a net basis, in the
third quarter of 2011, a decrease of 7.0 % from RMB46.6 million in the third quarter of 2010, and
a decrease of 5.1% from RMB45.7
million in the second quarter of 2011. Due to continued
fierce price competition, revenues from the Company's "Daytime
Advertising Package" and "Television Guide Package" decreased as
compared to the previous quarter. The Company's "Periodic China
News Package" on CCTV-4 registered a noticeable increase in sales
as compared to the previous quarter. Especially in September, all
one-minute advertising time slots were sold out.
Nevertheless, the total revenues from advertising agency
services decreased slightly from the second quarter of 2011. The
decrease in revenues compared with the third quarter of last year
was mainly due to the decrease in revenues relating to the
"Periodic China News Package", as the time slots available for sale
from that program decreased from 90 seconds in 2010 to 60 seconds
in 2011.
Revenues from special event services were
RMB14.7 million (US$2.3 million) in the third quarter of 2011,
being the service fee paid by CCTV for the Company's services in
advertising and promotional activities for the 2008 Beijing Olympic
Games. We recognized this revenue when the Company received payment
from CCTV during the quarter. No special event services
revenue were recognized in the third quarter of 2010 and in the
previous quarter of 2011.
Revenues from production and sponsorship services were
RMB3.3 million (US$0.5 million) in the third quarter of 2011, a
decrease of 69.2% from RMB10.7
million in the third quarter of 2010, and a decrease of
65.0% from RMB9.4 million in the
second quarter of 2011. During the third quarter of 2011, the
Company successfully produced a number of commercials for clients
such as Xiwang Sugar and Beijing
Economic and Technological Development Zone Management Committee.
As of July 1, 2011, the Company
ceased to be the producer of the "Guang Er Gao Zhi" program due to
CCTV program changes. Revenues from sponsorship service in relation
to the "Guang Er Gao Zhi" program amounted to RMB5.4 million and RMB4.5
million for the three months ended June 30, 2011 and September 30, 2010 respectively. Overall,
revenues from production and sponsorship services decreased
significantly on both a year-over-year and sequential basis.
Operating costs and expenses
Cost of revenues was RMB27.0
million (US$4.2 million) in
the third quarter of 2011, a decrease of 15.7 % from RMB32.0 million in the third quarter of 2010 and
an increase of 10.2% from RMB24.5
million in the second quarter of 2011. The significant
decrease in cost of revenues from the third quarter of 2010 was
because time slots available on the Company's "Periodic China News
Package" on CCTV-4 decreased from 90 seconds in 2010 to 60 seconds
in 2011. The increase of cost of revenue compared with the second
quarter of 2011 was mainly because in the second quarter of 2011,
the Company received a RMB4.1 million
refund from CCTV for the purchase price relating to the
advertisements that CCTV-4 failed to broadcast in 2010, and such
refund was used to offset the relevant media costs of the "Periodic
China News Package". Thus the cost of revenues in the second
quarter was lower as a result.
Sales and marketing expenses were RMB6.7 million (US$1.1
million) in the third quarter of 2011, an increase of 87.3%
from RMB3.6 million in the third
quarter of 2010 and an increase of 59.5% from RMB4.2 million in the second quarter of 2011. The
increase compared with the third quarter of 2010 and the previous
quarter was mainly due to the increase in salary. The Company
extended a bonus of RMB2.0 million to
our Chief Executive Officer for his contribution in the Special
Event Services.
General and administrative expenses were RMB7.0 million (US$1.1
million) in the third quarter of 2011, an increase of 3.8%
compared to the RMB6.7 million in the
third quarter of 2010 and a decrease of 19.8% from RMB8.7 million in the second quarter of 2011. The
increase compared with the third quarter of 2010 was mainly due to
the effect of a write-back of bad debt provision in the third
quarter of 2010. The decrease compared with the previous
quarter was mainly because of the Company's payment of RMB2.5 million in fees for sponsors, lawyers and
auditors in the previous quarter in connection with the Company's
efforts to list on the Hong Kong Stock Exchange.
Operating income, as a result of the foregoing factors,
was RMB16.9 million (US$2.6 million) in the third quarter of 2011, an
increase of 35.1% from RMB12.5
million in the third quarter of 2010 and an increase of
17.7% from RMB14.3 million in the
second quarter of 2011. The Company's operating margin was 22.8%,
27.7% and 29.3% for the quarters ended September 30, 2010, June
30, 2011 and September 30,
2011, respectively.
Other expenses included an exchange loss of RMB0.8 million (US$0.1
million) in the third quarter of 2011. As the Company
converted its overseas US dollar deposits to Renminbi deposits at
the end of the first quarter, the exchange loss arising from the
appreciation of the Renminbi against the US dollar decreased
significantly as compared to the exchange loss of RMB3.3 million in the third quarter of 2010.
Other expenses are relatively stable as compared with the second
quarter of 2011.
Income tax expense was RMB7.0
million (US$1.1 million) in
the third quarter of 2011, an increase of 57.3% from RMB4.5 million in the third quarter of 2010, and
an increase of 21.2% from RMB5.8
million in the second quarter of 2011. The Company's
effective tax rate was 41%, 34.0% and 33.4% for the quarters ended
September 30, 2010, June 30, 2011 and September 30, 2011, respectively. The effective
tax rate for the third quarter of 2011 was higher than the PRC
statutory tax rate mainly because the intermediary service expenses
incurred by offshore companies and exchange losses of RMB0.8 million incurred by the appreciation of
the Renminbi against the US dollar were not deductible for PRC tax
purposes.
Effective tax rate for the third quarter of 2011 was higher than
the PRC Statutory tax rate was also attributable to the 10%
withholding tax being accrued for the 30% earnings earned in PRC.
As we declared a special cash dividend in the fourth quarter
of 2011, we need to accrue additional withholding tax in the fourth
quarter of 2011 to make the dividend payments.
Net income was RMB14.0
million (US$2.2 million) in
the third quarter of 2011, an increase of 117.8% from net income of
RMB6.4 million in the third quarter
of 2010 and an increase of 24.8% from RMB11.2 million in net income in the second
quarter of 2011. The Company's net margin was 11.8%, 21.7% and
24.4% for the quarters ended September 30,
2010, June 30, 2011 and
September 30, 2011, respectively.
Basic and diluted earnings per ADS for the third quarter of 2011
were RMB0.56 (US$0.09), compared with basic and diluted
earnings per ADS of RMB0.24 for the
third quarter of 2010 and RMB0.44 for
the second quarter of 2011. Each ADS represents 30 ordinary shares
of the Company as of September 30,
2011.
Business Outlook
The Company currently expects to generate total net revenues of
between RMB48 million and RMB53
million for the fourth quarter of 2011. The expected range
of net revenues represents a potential decrease of 36.7% to 30.1%
compared with the fourth quarter of 2010 due to continuous price
competition. This forecast reflects the Company's current and
preliminary estimate, which is subject to change.
Conference Call
China Mass Media will host a conference call and live webcast
at 8:00 a.m. Eastern Standard Time (EST) on November 21, 2011 (9:00
pm Beijing Time on November 21,
2011).
The dial-in details for the live conference call are as
follows:
|
- International
Toll Free Number:
|
+ 65 6723 9381
|
|
|
- U.S. Toll Free Number:
|
+1 866 519 4004
|
|
|
- U.S. Toll Number:
|
+1 718 354 1231
|
|
|
- HK.
Toll Number:
|
852 2475
0994
|
|
|
- China Toll Free
Number:
|
800 819
0121
|
|
|
400 620
8038
|
|
|
Passcode: CMM
|
|
|
|
|
A live webcast of the conference call will be available on the
investor relations section of the Company's website at:
http://www.chinammia.com.
A telephone replay of the call will be available after the
conclusion of the conference call. The dial-in details for the
replay are as follows:
|
- U.S. Toll Free
Number:
|
+1 866 214 5335
|
|
|
- International dial-in
number:
|
+61 2 8235 5000
|
|
|
Passcode: 2042
7269
|
|
|
|
|
Non-GAAP Disclosure
In addition to the unaudited consolidated financial information
presented in accordance with US GAAP, management uses a non-GAAP
measure of net income excluding non-cash share-based compensation.
Company management believes excluding the share-based compensation
expenses from non-GAAP financial measures is useful for the
investors' understanding of overall current financial performance.
Nevertheless, the limitation of using non-GAAP financial measures
excluding share-based compensation expenses is that share-based
compensation expenses have been and will continue to be a
significant recurring expense in the Company's business.
The presentation of the non-GAAP financial measures is not
intended to be considered in isolation or as a substitute for the
financial information prepared and presented in accordance with US
GAAP. For more information on these non-GAAP financial measures,
please see the tables captioned "Reconciliations of unaudited
non-GAAP results of operations measures to the nearest comparable
GAAP measures" set forth below, which shall be read in conjunction
with the preceding financial information presented in accordance
with US GAAP.
Safe Harbor Statement
This document contains forward-looking statements within the
meaning of Section 21E of the Securities Exchange Act of 1934, as
amended, and Section 27A of the Securities Act of 1933, as amended,
and the U.S. Private Securities Litigation Reform Act of 1995.
These statements include, but are not limited to, statements about
the Company's plans, objectives, expectations, strategies,
intentions, or other characterizations of future events or
circumstances and are generally identified by the words
"anticipates", "believes", "could", "estimates", "expects",
"intends", "may", "plans", "seeks", "would", and similar
expressions.
A number of factors could cause the Company's actual results,
performance, achievements or industry results to be materially
different from any future results, performance or achievements
expressed or implied by these forward-looking statements.
Additional information concerning factors that could cause actual
results to materially differ from those in the forward-looking
statements is contained in the Securities and Exchange Commission
filings of the Company. China Mass Media does not undertake any
obligation to update any forward-looking statements, except as
required under applicable law.
About China Mass Media Corp.
As a leading television advertising company in China, the Company provides a full range of
advertising services, including advertising agency services,
creative production services, public service announcement
sponsorship services, and other value added services. The Company
currently offers approximately 41 minutes of advertising time slots
per day on CCTV Channels 1, 2, and 4. CCTV is the largest
television network in China. The
Company has produced over 400 advertisements and has won a number
of prestigious awards in China and
across the world, including the "Gold World Medal" at The New York
Festivals® International Television & Film Awards. For more
information, please visit http://www.chinammia.com.
For further information, contact:
China Mass Media Corp.
Julie Sun
Chief Financial Officer
6/F, Tower B, Corporate Square,
35 Finance Street Xicheng District
Beijing, 100033
P. R. China
Phone: +86-10-8809-1050
Email: juliesun@chinammia.com
Christensen
Tip Fleming
Phone: +852-2117-0861
Email: tfleming@christensenir.com
Teal Willingham
Phone: +852-9827-3632
Email: twillingham@christensenir.com
|
CHINA MASS
MEDIA CORP.
UNAUDITED
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
|
THREE MONTHS ENDED,
|
|
|
September 30,
2010
|
|
June 30,
2011
|
|
September 30,
2011
|
|
September 30,
2011
|
|
|
RMB
|
|
RMB
|
|
RMB
|
|
US$
|
|
|
|
|
|
|
|
|
|
|
|
Revenues:
|
|
|
|
|
|
|
|
|
|
Advertising agency
services
|
46,604,275
|
|
45,663,780
|
|
43,352,565
|
|
6,797,204
|
|
|
Special
event services
|
-
|
|
-
|
|
14,659,600
|
|
2,298,463
|
|
|
Advertisement production
and sponsorship services
|
10,708,029
|
|
9,440,351
|
|
3,301,713
|
|
517,672
|
|
|
Total revenue
|
57,312,304
|
|
55,104,131
|
|
61,313,878
|
|
9,613,339
|
|
|
Less: Business
tax
|
(2,561,134)
|
|
(3,406,283)
|
|
(3,793,799)
|
|
(594,826)
|
|
Total net
revenues
|
54,751,170
|
|
51,697,848
|
|
57,520,079
|
|
9,018,513
|
|
|
|
|
|
|
|
|
|
|
|
Operating costs and
expenses:
|
|
|
|
|
|
|
|
|
|
Cost of
revenues
|
(31,954,073)
|
|
(24,459,536)
|
|
(26,953,073)
|
|
(4,225,944)
|
|
|
Sales and marketing
expenses
|
(3,595,523)
|
|
(4,222,482)
|
|
(6,733,407)
|
|
(1,055,724)
|
|
|
General and
administrative expense
|
(6,712,846)
|
|
(8,689,827)
|
|
(6,965,218)
|
|
(1,092,069)
|
|
|
Total operating costs and
expenses
|
(42,262,442)
|
|
(37,371,845)
|
|
(40,651,698)
|
|
(6,373,737)
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
12,488,728
|
|
14,326,003
|
|
16,868,381
|
|
2,644,776
|
|
|
|
|
|
|
|
|
|
|
|
Interest and investment
income
|
1,482,268
|
|
3,465,320
|
|
4,970,052
|
|
779,249
|
|
|
Other expense,
net
|
(3,071,458)
|
|
(766,957)
|
|
(799,574)
|
|
(125,364)
|
|
|
|
|
|
|
|
|
|
|
|
Income before
tax
|
10,899,538
|
|
17,024,366
|
|
21,038,859
|
|
3,298,661
|
|
|
Income tax
expense
|
(4,465,167)
|
|
(5,792,977)
|
|
(7,021,745)
|
|
(1,100,932)
|
|
|
Net income
|
6,434,371
|
|
11,231,389
|
|
14,017,114
|
|
2,197,729
|
|
|
|
|
|
|
|
|
|
|
|
Net income available to
ordinary shareholders
|
6,434,371
|
|
11,231,389
|
|
14,017,114
|
|
2,197,729
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per ordinary
share, basic
|
0.008
|
|
0.0147
|
|
0.0186
|
|
0.0029
|
|
|
Earnings per ordinary
share, diluted
|
0.008
|
|
0.0147
|
|
0.0186
|
|
0.0029
|
|
|
Earnings per ADS,
basic
|
0.24
|
|
0.4420
|
|
0.5580
|
|
0.0875
|
|
|
Earnings per ADS,
diluted
|
0.24
|
|
0.4420
|
|
0.5580
|
|
0.0875
|
|
|
|
|
|
|
|
|
|
|
|
Shares used in calculating
earnings per ordinary share, basic
|
788,012,500
|
|
762,320,613
|
|
753,541,727
|
|
753,541,727
|
|
|
Shares used in calculating
earnings per ordinary share, diluted
|
788,702,468
|
|
762,320,613
|
|
753,541,727
|
|
753,541,727
|
|
|
Shares used in calculating
earnings per ADS, basic(Note)
|
26,267,083
|
|
25,410,687
|
|
25,118,058
|
|
25,118,058
|
|
|
Shares used in calculating
earnings per ADS, diluted
|
26,290,082
|
|
25,410,687
|
|
25,118,058
|
|
25,118,058
|
|
|
|
|
|
|
|
|
|
|
Note: Effective on
November 28, 2011, the Company will change the ratio of its
ordinary shares to American
depositary share
("ADS") from 30:1
to 300:1. There will be no change to China Mass
Media's underlying
ordinary
shares. After November 28,
2011, all earnings per ADS for prior periods will be
retrospectively adjusted to reflect
the new ADS ratio.
|
|
|
|
|
|
|
|
|
|
|
CHINA MASS
MEDIA CORP.
UNAUDITED
CONDENSED CONSOLIDATED BALANCE SHEETS
|
|
|
|
December 31,
2010
|
|
September 30,
2011
|
|
September 30,
2011
|
|
|
|
RMB
|
|
RMB
|
|
US$
|
|
|
Assets
|
|
|
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
544,427,828
|
|
145,325,197
|
|
22,785,387
|
|
|
Restricted
cash
|
|
10,000,000
|
|
|
|
|
|
|
Short-term
investments
|
|
150,000,000
|
|
414,149,829
|
|
64,934,122
|
|
|
Notes
receivable
|
|
5,892,690
|
|
1,460,000
|
|
228,912
|
|
|
Accounts receivable,
net
|
|
991,024
|
|
3,065,450
|
|
480,629
|
|
|
Prepaid expenses
and other current assets
|
|
41,794,343
|
|
102,393,184
|
|
16,054,121
|
|
|
Total
current assets
|
|
753,105,885
|
|
666,393,660
|
|
104,483,171
|
|
|
Non-current
assets
|
|
|
|
|
|
|
|
|
Property and
equipment, net
|
|
58,602,500
|
|
58,252,554
|
|
9,133,357
|
|
|
Total
non-current assets
|
|
58,602,500
|
|
58,252,554
|
|
9,133,357
|
|
|
Total
assets
|
|
811,708,385
|
|
724,646,214
|
|
113,616,528
|
|
|
|
|
|
|
|
|
|
|
Liabilities
and Shareholders' Equity
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
|
Accounts
payable
|
|
156,494,604
|
|
86,417,004
|
|
13,549,232
|
|
|
Customer
advances
|
|
39,311,493
|
|
50,438,822
|
|
7,908,251
|
|
|
Accrued expenses
and other current liabilities
|
|
23,848,004
|
|
23,479,183
|
|
3,681,277
|
|
|
Taxes
payable
|
|
30,194,919
|
|
20,644,655
|
|
3,236,854
|
|
|
Amount due to
related parties
|
|
53,237,048
|
|
10,883,700
|
|
1,706,444
|
|
|
Total
current liabilities
|
|
303,086,068
|
|
191,863,364
|
|
30,082,058
|
|
|
Total
Liabilities
|
|
303,086,068
|
|
191,863,364
|
|
30,082,058
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
|
|
|
|
|
|
|
Ordinary shares ($0.001
par value; 3,000,000,000 shares authorized; 788,332,360
shares issued and outstanding as
of December 31,
2010;
751,829,020 shares
issued and outstanding as of September
30,
2011)
|
|
5,381,321
|
|
5,145,681
|
|
806,786
|
|
|
Additional paid-in
capital
|
|
361,736,018
|
|
343,021,364
|
|
53,781,964
|
|
|
Statutory
reserves
|
|
25,000,000
|
|
25,000,000
|
|
3,919,724
|
|
|
Other
comprehensive income
|
|
-
|
|
349,058
|
|
54,728
|
|
|
Retained
earnings
|
|
126,034,102
|
|
159,581,955
|
|
25,020,689
|
|
|
Repurchased shares to be
cancelled, at cost (13,860,000 ordinary
shares as of December 31,
2010 and
1,326,000 ordinary
shares as of September 30,
2011)
|
|
(9,529,124)
|
|
(315,208)
|
|
(49,421)
|
|
|
Total
Shareholders' Equity
|
|
508,622,317
|
|
532,782,850
|
|
83,534,470
|
|
|
|
|
|
|
|
|
|
|
Total
Liabilities and Shareholders'
Equity
|
|
811,708,385
|
|
724,646,214
|
|
113,616,528
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CHINA MASS
MEDIA CORP.
UNAUDITED
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
|
THREE MONTHS ENDED
|
|
|
September 30,
2010
|
|
June 30,
2011
|
|
September 30,
2011
|
|
September 30,
2011
|
|
|
RMB
|
|
RMB
|
|
RMB
|
|
US$
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows
from operating activities:
|
|
|
|
|
|
|
|
|
|
Net income
|
6,434,371
|
|
11,231,389
|
|
14,017,114
|
|
2,197,729
|
|
|
Adjustments to reconcile
net income to net cash provided by (used in)
operating activities
|
|
|
|
|
|
|
|
|
|
Depreciation
expense
|
774,606
|
|
1,038,622
|
|
1,072,696
|
|
168,187
|
|
|
Investment income
|
(1,140,083)
|
|
(2,306,877)
|
|
(3,824,844)
|
|
(599,693)
|
|
|
Exchange
loss
|
3,308,936
|
|
784,999
|
|
785,798
|
|
123,204
|
|
|
Share-based
compensation
|
215,601
|
|
627,576
|
|
438,047
|
|
68,681
|
|
|
Loss (Gain)
on disposal of property
and equipment
|
-
|
|
(7,359)
|
|
14,143
|
|
2,217
|
|
|
Changes in assets and
liabilities:
|
|
|
|
|
|
|
|
|
|
Notes
receivable
|
-
|
|
6,726,095
|
|
440,000
|
|
68,987
|
|
|
Accounts
receivable, net
|
5,634,850
|
|
(3,188,009)
|
|
5,215,435
|
|
817,723
|
|
|
Prepaid expense and
other current assets
|
4,256,345
|
|
(4,883,765)
|
|
(58,749,687)
|
|
(9,211,302)
|
|
|
Accounts
payable
|
19,248,859
|
|
(9,778,480)
|
|
(104,450,980)
|
|
(16,376,761)
|
|
|
Customer
advances
|
15,051,709
|
|
(5,854,045)
|
|
16,964,850
|
|
2,659,901
|
|
|
Accrued expenses
and other current liabilities
|
770,278
|
|
2,301,925
|
|
(32,056)
|
|
(5,025)
|
|
|
Taxes
payable
|
97,832
|
|
(1,516,820)
|
|
4,166,500
|
|
653,261
|
|
|
Amount due to
related parties
|
(123,360)
|
|
(7,995,148)
|
|
(34,371,353)
|
|
(5,389,049)
|
|
|
Net cash
provided by (used in)
operating
activities
|
54,529,944
|
|
(12,819,897)
|
|
(158,314,337)
|
|
(24,821,940)
|
|
|
Cash flows
from investing activities:
|
|
|
|
|
|
|
|
|
|
Net proceeds from redemption /
(purchase) of short-term investments
|
(190,000,000)
|
|
(196,469,251)
|
|
182,317,254
|
|
28,585,333
|
|
|
Decrease in
restricted cash
|
-
|
|
10,000,000
|
|
-
|
|
|
|
|
Purchase of property and
equipment
|
(6,408,266)
|
|
(409,384)
|
|
(707,707)
|
|
(110,961)
|
|
|
Proceeds from
disposal of property and
equipment
|
-
|
|
146,796
|
|
783
|
|
123
|
|
|
Gain on sales of
investment
|
1,040,082
|
|
2,570,987
|
|
3,824,844
|
|
599,693
|
|
|
Net cash
provided by / (used in) investing activities
|
(195,268,184)
|
|
(184,160,852)
|
|
185,435,174
|
|
29,074,188
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows
from financing activities:
Repurchase stocks on open
market
|
-
|
|
(2,673,929)
|
|
(2,986,471)
|
|
(468,246)
|
|
|
Net cash
used in financing activities
|
-
|
|
(2,673,929)
|
|
(2,986,471)
|
|
(468,246)
|
|
Effect of
foreign currency exchange
|
(3,308,936)
|
|
(320,371)
|
|
(785,797)
|
|
(123,204)
|
|
|
Net increase
/ (decrease) in cash and cash equivalents
|
(144,047,176)
|
|
(199,975,049)
|
|
23,348,569
|
|
3,660,798
|
|
|
Cash and
cash equivalents at beginning of the period
|
543,670,688
|
|
321,951,677
|
|
121,976,628
|
|
19,124,589
|
|
|
Cash and
cash equivalents at end of the period
|
399,623,512
|
|
121,976,628
|
|
145,325,197
|
|
22,785,387
|
|
|
|
|
|
|
|
|
|
|
|
|
CHINA MASS
MEDIA CORP.
SELECTED
OPERATING DATA
|
|
|
|
THREE MONTHS ENDED
|
|
|
|
September 30,
2010
|
|
June 30,
2011
|
|
September 30,
2011
|
|
|
|
|
|
|
|
|
|
|
Number of programs secured
during the period
|
|
35
|
|
35
|
|
3(1)
|
|
|
Total advertising time obtained
(seconds)
|
|
2,621,970
|
|
2,580,630
|
|
224,400(2)
|
|
|
Total advertising time sold
(seconds)
|
|
132,880
|
|
148,330
|
|
104,310(3)
|
|
|
|
|
|
|
|
|
|
|
(1)
The Company ceased to be
the advertising agency of CCTV-E and CCTV-F
from July
1, 2011. The number of
programs
secured and total advertising
time obtained decreased accordingly.
(2)
Represents the total amount of
time during regular television programs secured through our
contracts with
CCTV-1,
CCTV-2 and CCTV-4
for the period ended September
30, 2011.
(3)
During the three-month periods
ended September 30,
2010, June 30,
2011 and
September 30, 2011,
the Company
has sold 19,680 seconds
and 21,000 seconds and nil
seconds of advertisements in CCTV-E and
CCTV-F.
|
|
|
|
|
|
|
|
|
|
|
|
RECONCILIATIONS OF UNAUDITED
NON-GAAP RESULTS OF OPERATIONS
MEASURES TO THE NEAREST
COMPARABLE GAAP MEASURES (*)
|
|
|
THREE MONTHS ENDED SEPTEMBER 30, 2010
|
|
THREE MONTHS ENDED SEPTEMBER 30, 2011
|
|
|
GAAP Results
|
Adjustment
|
NON-GAAP Result
|
|
GAAP Result
|
Adjustment
|
NON-GAAP Result
|
|
|
RMB
|
RMB
|
RMB
|
|
RMB
|
RMB
|
RMB
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
12,488,728
|
215,601
|
12,704,329
|
|
16,868,381
|
438,047
|
17,306,428
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
6,434,371
|
215,601
|
6,649,972
|
|
14,017,114
|
438,047
|
14,455,161
|
|
|
|
|
|
|
|
|
|
|
|
(*)The adjustment is for
share-based compensation expenses and has no tax effect as the
Cayman Islands, where the
Company was incorporated,
currently does not levy taxes on individuals or corporations based
upon profits, income,
gains or
appreciation.
|
|
|
|
|
|
|
|
|
|
Non-GAAP Disclosure
In addition to the unaudited consolidated financial information
presented in accordance with US GAAP, management uses a non-GAAP
measure of net income excluding non-cash share-based compensation.
Company management believes excluding the share-based compensation
expenses from non-GAAP financial measures is useful for the
investors' understanding of overall current financial performance.
Nevertheless, the limitation of using non-GAAP financial measures
excluding share-based compensation expenses is that share-based
compensation expenses have been and will continue to be a
significant recurring expense in the Company's business.
The presentation of the non-GAAP financial measures is not
intended to be considered in isolation or as a substitute for the
financial information prepared and presented in accordance with US
GAAP. For more information on these non-GAAP financial measures,
please see the tables captioned "Reconciliations of unaudited
non-GAAP results of operations measures to the nearest comparable
GAAP measures" set forth above, which shall be read in conjunction
with the preceding financial information presented in accordance
with US GAAP.
SOURCE China Mass Media Corp.