SHANGHAI, March 25, 2013 /PRNewswire/ -- Focus Media Holding Limited FMCN today announced its unaudited financial results for the fourth quarter and full year ended December 31, 2012.
Highlights for Fourth Quarter 2012:
- Total net revenue for the fourth quarter of 2012 was $250.2 million, of which
- aggregate net revenue from the LCD display network, in-store network, poster frame network and movie theater network was $244.1 million, within the Company's guidance of between $237.0 million and $246.0 million. This represented a slight decrease of 1% from $247.7 million for the third quarter of 2012 and an increase of 2% from $238.8 million for the fourth quarter of 2011; and
- net revenue from the traditional outdoor billboard network for the fourth quarter of 2012 was $6.1 million, within the Company's guidance of between $6.0 million and $7.0 million.
- GAAP net income attributable to Focus Media for the fourth quarter of 2012 was $76.7 million, representing an increase of 19% from $64.6 million for the third quarter of 2012 and an increase of 107% from $37.1 million for the fourth quarter of 2011, and was adversely affected by the loss from equity method investee, VisionChina, of $38.9 million.
- Non-GAAP net income attributable to Focus Media for the fourth quarter of 2012 was $95.1 million, within the Company's guidance of between $93 million and $98 million, slightly increasing from $94.6 million for the third quarter of 2012 and a slight decline of 1% from $96.0 million for the fourth quarter of 2011. Please see the below sections on "Use of Non-GAAP Financial Measures" and "Reconciliation of GAAP to non-GAAP" for more information about the non-GAAP measures referred to within this announcement.
- GAAP net income attributable to Focus Media per fully diluted ADS was $0.57, representing an increase of 19% from $0.48 per fully diluted ADS for the third quarter of 2012 and an increase of 111% from $0.27 per fully diluted ADS in the fourth quarter of 2011.
- Non-GAAP net income attributable to Focus Media per fully diluted ADS was $0.71, substantially unchanged from $0.71 per fully diluted ADS for the third quarter of 2012 and an increase of 1% from $0.70 per fully diluted ADS for the fourth quarter of 2011.
Highlights for Full Year 2012:
- Total net revenue for full year 2012 was $927.5 million, an increase of 18% from $786.5 million for full year 2011, of which
- aggregate net revenue from the LCD display network, in-store network, poster frame network and movie theater network was $895.5 million, representing an increase of 22% from $737.0 million for full year 2011 ; and
- net revenue from the traditional outdoor billboard network was $32.0 million, representing a decrease of 35% from $49.5 million for full year 2011.
- GAAP net income attributable to Focus Media for full year 2012 was $238.1 million, representing an increase of 46% from $162.7 million for full year 2011.
- Non-GAAP net income attributable to Focus Media for full year 2012 was $333.1 million, representing an increase of 17% from $284.1 million for full year 2011. Please see the below sections on "Use of Non-GAAP Financial Measures" and "Reconciliation of GAAP to non-GAAP" for more information about the non-GAAP measures referred to within this announcement.
- GAAP net income attributable to Focus Media per fully diluted ADS for full year 2012 was $1.79, representing an increase of 52% from $1.18 per fully diluted ADS for full year 2011.
- Non-GAAP net income attributable to Focus Media per fully diluted ADS for full year 2012 was $2.50, a 22% increase from $2.05 per fully diluted ADS for full year 2011.
Highlights for Balance Sheet and Cash Flow Results of Fourth Quarter and Full Year 2012:
- Cash, cash equivalents, short-term investments and restricted cash were $1,029.8 million as of December 31, 2012, increasing by 14% from $901.1 million as of September 30, 2012. Our short-term investments consist of longer term dated cash deposits that earn a higher interest rate as compared to cash and cash equivalents.
- Bank loans were $200.0 million which were all long-term bank loans as of December 31, 2012 secured by onshore renminbi cash deposits, as compared to bank loans of $200.0 million inclusive of short-term bank loans of $100.0 million as of September 31, 2012, which was renewed and converted into long-term bank loans in the fourth quarter of 2012. Long-term bank loans of $100.0 million outstanding as of September 30, 2012, were also extended to 2018 in the fourth quarter of 2012. The bank loan as of December 31, 2012 consisted of a $200.0 million term loan facility agreement entered into on November 21, 2012 with DBS Bank Ltd., Hong Kong Branch ("DBS") and was used to repay all of the Company's outstanding indebtedness under its previous credit facilities with DBS.
- Net accounts receivable for the LCD display network, in-store network, poster frame network and movie theater network was $275.6 million as of December 31, 2012, a decrease of 3% from $284.1 million as of September 30, 2012. Days sales outstanding was 100 days in the fourth quarter of 2012 versus 92 days for the third quarter of 2012. Days sales outstanding was 97 days for full year 2012 versus 85 days for full year 2011. As a supplementary cash collection metric, the actual cash collection from accounts receivables and prepayments from the advertisers was $281.7 million in the fourth quarter of 2012, as compared to $239.8 million in the fourth quarter of 2011.
- Net cash inflow from operating activities in the fourth quarter of 2012 and full year of 2012 were $142.4 million and $358.3 million, respectively, representing an 11% increase from $128.8 million for the fourth quarter of 2011 and a 28% increase from $280.2 million for full year 2011, respectively.
- Net cash inflow from operating activities for the fourth quarter of 2012, after deducting the purchase of equipment and subsidiaries was $137.6 million, an increase of 22% from $112.7 million for the fourth quarter of 2011. Net cash inflow from operating activities for full year 2012, after deducting the purchase of equipment and subsidiaries was $335.7 million, representing an increase of 47% from $228.0 million for full year 2011.
- Capital expenditures were $4.8 million and $19.6 million respectively for the fourth quarter and full year of 2012, mostly attributable to upgrading our LCD screens into interactive screens and network expansion in and into lower tier cities in China.
Jason Jiang, Chairman and Chief Executive Officer of Focus Media said, "In the fourth quarter of 2012, our operation's performance was in-line with our previous expectations as we continue to be affected by a slower overall advertising spending in China."
Kit Low, the Company's Chief Financial Officer added, "In the fourth quarter of 2012, the Company's aggregate net revenue year-on-year growth in our LCD display, poster frame business, in-store and movie theater network was 2%. GAAP net income attributable to Focus Media and Non-GAAP net income attributable to Focus Media for the fourth quarter of 2012 was $76.7 million and $95.1 million, respectively. In the fourth quarter of 2012, the Company generated a net cash inflow from operating activities after deducting the purchases of equipment and subsidiaries of $137.6 million."
Fourth Quarter 2012 financial results
Advertising net revenue from the LCD display network was $127.5 million for the fourth quarter of 2012, representing a slight decrease of 1% from $128.4 million for the third quarter of 2012 and a decrease of 7% from $137.4 million for the fourth quarter of 2011. The decrease in net revenue was due to a weaker brand advertising environment.
Advertising net revenue from the poster frame network was $85.7 million for the fourth quarter of 2012, representing an increase of 5% from $81.6 million for the third quarter of 2012 and an increase of 33% from $64.5 million for the fourth quarter of 2011, which was driven by the strength of promotional budget spending in the market.
Advertising net revenue from the in-store network was $11.1 million for the fourth quarter of 2012, representing a decrease of 23% from $14.5 million for the third quarter of 2012 and a decrease of 31% from $16.1 million for the fourth quarter of 2011. The decrease was mostly attributable to less advertising spending from domestic dairy producers.
Advertising net revenue from the movie theater network was $19.8 million for the fourth quarter of 2012, representing a decrease of 15% from $23.2 million for the third quarter of 2012 due to seasonal factors and a decrease of 5% from $20.8 million for the fourth quarter of 2011. The decrease in net revenue was mainly due to a weaker brand advertising environment.
Advertising net revenue from the traditional outdoor billboard network was $6.1 million for the fourth quarter of 2012, representing a decrease of 21% from $7.7 million for the third quarter of 2012 and a decrease of 56% from $13.9 million for the fourth quarter of 2011 due to combination of downsizing of the division and a weaker advertising environment. Due to medium term advertising spending uncertainties and the continued view of the Company that the traditional outdoor billboard network is not a core business segment, the Company has decided to downsize this business segment by divesting four entities within the segment. Two of which have been divested prior to end of the third quarter of 2012 and the other two were divested in the fourth quarter of 2012. Consequently, $1.2 million of revenues of two divested entities for the fourth quarter of 2012, $4.8 million of revenues of four divested entities for the third quarter of 2012 and $3.8 million of revenues of four divested entities for the fourth quarter of 2011 have been reclassified into "Net loss from discontinued operations" in the consolidated statements of operations. Other relevant items in the consolidated statements of operations were also reclassified accordingly to reflect the reclassification arising from the discontinued operations of the 4 entities.
Non-GAAP gross profit from the LCD display network for the fourth quarter of 2012 was $98.3 million, representing a decrease of 2% from $99.8 million for the third quarter of 2012 and a decrease of 13% from $113.6 million for the fourth quarter of 2011. The decrease in non-GAAP gross profit was a result of quarter-on-quarter and year-on-year revenue declines while the cost of sales remained largely unchanged in the LCD display network
Non-GAAP gross profit from the poster frame network for the fourth quarter of 2012 was $56.9 million, representing an increase of 8% from $52.5 million for the third quarter of 2012, and an increase of 58% from $35.9 million for the fourth quarter of 2011.
Non-GAAP gross profit from the in-store network for the fourth quarter of 2012 was $5.8 million, representing a decrease of 36% from $9.1 million for the third quarter of 2012 and a decrease of 55% from $12.8 million in the fourth quarter of 2011 mainly due to the combination of a lower revenue and relatively unchanged cost of sales.
Non-GAAP gross profit from the movie theater network for the fourth quarter of 2012 was $10.9 million, representing a decrease of 25% from $14.5 million for the third quarter of 2012 and a decrease of 21% from $13.8 million for the fourth quarter of 2011 due to a lower revenue and a larger cost of sales as a result of network expansion.
Non-GAAP gross profit from the traditional outdoor billboard network for the fourth quarter of 2012 was $0.8 million, compared to $1.2 million loss for the third quarter of 2012 and a decrease of 62% from $2.1 million for the fourth quarter of 2011.
Non-GAAP operating expense for the fourth quarter of 2012 was $57.9 million, substantially unchanged from $57.5 million for the third quarter of 2012. It also represented a decrease of 7% from $62.2 million for the fourth quarter of 2011.
Net cash inflow from operating activities in the fourth quarter of 2012 and full year of 2012 were $142.4 million and $358.3 million, respectively, representing an 11% increase from $128.8 million for the fourth quarter of 2011 and a 28% increase from $280.2 million for full year 2011, respectively.
Net cash inflow from investing activities for the fourth quarter of 2012 was $53.3 million. In the fourth quarter of 2012, the Company incurred capital expenditures of $4.8 million. Meanwhile, the Company received net cash inflows from disposal of short-term investments after deducting the placement of restricted cash totaling $57.3 million during the quarter. Short-term investments are longer term dated cash deposits normally with maturities of between three and twelve months that earn higher interest rate as compared to cash and cash equivalents. Restricted cash is deposited in bank accounts as security for bank borrowings.
Net cash used for financing activities for the fourth quarter of 2012 was $17.8 million, which consisted of a dividend paid by the Company declared in the third quarter of 2012.
Operating Data Summary
The Company is providing a breakdown of operating data as follows:
1) The approximate number of displays in the LCD display network was as follows:
|
As of December 31, 2012 |
As of September 30, 2012 | |
|
LCD screens (note) |
136,711 |
136,870 |
|
LCD 2.0 digital picture screens |
35,615 |
35,535 |
|
Total for LCD display network |
172,326 |
172,405 |
Note: The decrease in the total number of LCD screens as of December 31, 2012 as compared to that as of September 30, 2012 was due to network optimization. Of the total LCD screens of 136,711 as of December 31, 2012, 10,534 screens were operated through our regional distributors as compared to 9,589 screens as of September 30, 2012.
2) The approximate number of devices in the poster frame network was as follows:
|
As of December 31, 2012 |
As of September 30, 2012 | |
|
Frame 1.0 picture frames (note) |
505,571 |
497,269 |
|
Frame 2.0 digital picture screens |
36,341 |
35,892 |
|
Total |
541,912 |
533,161 |
Note: The increase in the total number of Frame 1.0 picture frames as of December 31, 2012 as compared to that as of September 30, 2012 was due to organic network expansion.
3) The total number of displays installed in our in-store network was approximately 52,267 as of December 31, 2012, slightly decreasing from 53,239 as of September 30, 2012 due to network optimization.
4) The number of movie screens on which the Company had the right to lease advertising time as of December 31, 2012 was approximately 2,730, as compared to 2,470 as of September 30, 2012. The increase was due to organic network expansion
Arrangements Regarding Announced Recurring Shareholder Payments
On January 10, 2012, the Company announced a policy starting from 2012 to issue a recurring dividend with payments expected to equal approximately 25% of the Company's annual non-GAAP net income of the preceding fiscal year and to reserve up to an additional 30% of the Company's annual non-GAAP net income of the preceding fiscal year (starting from 2012 earnings) that can be used, at the discretion of the board of directors, to increase the dividend payment or the size of our share purchase program in effect at that time (the "dividend policy").
The Company announced on November 27, 2012 that its board of directors had resolved to postpone approval of future cash dividends through December 31, 2012 due to ongoing considerations relating to the going private proposal.
Due to the signing on December 19, 2012 of the going private merger agreement, which prohibits the Company from paying any dividends or repurchasing any of its ordinary shares or ADS pending consummation of the merger, the Company's board of directors has resolved to terminate the dividend policy effective December 31, 2012.
Announcement of the Extraordinary General Meeting of Shareholders to Vote on the Going Private Transaction
The Company announced today that it has called an extraordinary general meeting of the shareholders to be held on April 29, 2013 to consider and vote on, among other things, the proposal to authorize and approve the previously announced agreement and plan of merger, dated December 19, 2012, among Giovanna Parent Limited, Giovanna Acquisition Limited and the Company, the plan of merger and the transactions contemplated thereby (including the merger).
Foreign Currency Translation
Assets and liabilities are translated at the exchange rate as of December 31, 2012, which was $1 to RMB 6.2855. Equity accounts are translated at historical exchange rates and revenues, expenses, gains and losses are translated using the average rate for the fourth quarter of 2012, which was $1 to RMB 6.2926. Translation adjustments are reported as a component of comprehensive income.
USE OF NON-GAAP FINANCIAL MEASURES
In addition to Focus Media's consolidated financial results under GAAP, the Company also provides non-GAAP financial measures, including non-GAAP gross profit (cumulatively and by segment), non-GAAP operating expenses, non-GAAP operating profit (loss), non-GAAP net income and non-GAAP fully-diluted earnings per ADR, all excluding share-based compensation expenses, amortization of acquired intangible assets, loss from equity investment and goodwill impairment. Management uses these non-GAAP financial measures to better assess operating performance of the Company. The Company believes that these non-GAAP financial measures provide investors with another method for assessing Focus Media's operating results in a manner that is focused on the performance of its ongoing operations. Readers are cautioned not to view non-GAAP results on a stand-alone basis or as a substitute for results under GAAP, or as being comparable to results reported or forecasted by other companies, and should refer to the reconciliation of GAAP results with non-GAAP results in the attached financial information. The Company believes that both management and investors benefit from referring to these non-GAAP financial measures in assessing the performance of Focus Media and when planning and forecasting for future periods. The Company computes its non-GAAP financial measures using a consistent method from quarter to quarter, mostly excluding share-based compensation expenses, amortization of acquired intangible assets, loss from equity investment and goodwill impairment. The accompanying tables have more details on the GAAP financial measures that are most directly comparable to non-GAAP financial measures and the related reconciliation between these financial measures.
|
Focus Media Holding Ltd. Reconciliation of GAAP to non-GAAP (U.S. Dollars in thousands, except percentages, share and per-share data) (Unaudited)
| ||||||||
|
Three months ended December 31, 2012 | ||||||||
|
GAAP |
(1) |
(2) |
(3) |
(4) |
Non-GAAP | |||
|
Gross Profit (loss) |
||||||||
|
LCD display network |
97,431 |
354 |
478 |
- |
98,263 | |||
|
Poster frame network |
56,776 |
- |
74 |
- |
56,850 | |||
|
In-store network |
5,841 |
- |
- |
5,841 | ||||
|
Movie theater network |
10,925 |
- |
- |
10,925 | ||||
|
Traditional outdoor billboard network |
333 |
- |
418 |
- |
751 | |||
|
Total Gross Profit |
171,306 |
354 |
970 |
- |
172,630 | |||
|
General and administrative |
32,968 |
(11,638) |
21,330 | |||||
|
Selling and marketing |
51,973 |
(998) |
(521) |
50,454 | ||||
|
Other operating income, net |
(13,897) |
(13,897) | ||||||
|
Total operating expense |
71,044 |
(12,636) |
(521) |
57,887 | ||||
|
Operating profit from continuing |
100,262 |
12,990 |
1,491 |
114,743 | ||||
|
Profit from continuing operations |
103,506 |
12,990 |
1,491 |
1,526 |
119,513 | |||
|
Net profit from continuing |
76,296 |
12,990 |
1,491 |
4,126 |
94,903 | |||
|
Net loss from discontinued |
(232) |
174 |
(375) |
(433) | ||||
|
Net income attributable to Focus |
76,672 |
12,990 |
1,665 |
4,126 |
(375) |
95,078 | ||
|
Basic net income from continuing |
0.59 |
0.73 | ||||||
|
Diluted net income from continuing |
0.57 |
0.71 | ||||||
|
Basic net income from discontinued |
0.00 |
0.00 | ||||||
|
Diluted net income from discontinued |
0.00 |
0.00 | ||||||
|
Basic net income attributable to Focus |
0.59 |
0.73 | ||||||
|
Diluted net income attributable to Focus |
0.57 |
0.71 | ||||||
|
ADS used in calculating basic income |
130,265,271 |
130,265,271 | ||||||
|
ADS used in calculating diluted income |
134,529,688 |
134,529,688 | ||||||
|
(1). Share-based compensation. | ||||||||
|
Three months ended September 30, 2012 | ||||||
|
GAAP |
(1) |
(2) |
(3) |
(4) |
Non-GAAP | |
|
Gross Profit (loss) |
||||||
|
LCD display network |
98,443 |
495 |
813 |
- |
- |
99,751 |
|
Poster frame network |
52,341 |
- |
129 |
- |
- |
52,470 |
|
In-store network |
9,082 |
- |
- |
- |
- |
9,082 |
|
Movie theater network |
14,471 |
- |
- |
- |
- |
14,471 |
|
Traditional outdoor billboard network |
(1,708) |
- |
462 |
- |
- |
(1,246) |
|
Total Gross Profit |
172,629 |
495 |
1,404 |
- |
- |
174,528 |
|
General and administrative |
36,132 |
(14,884) |
- |
- |
- |
21,248 |
|
Selling and marketing |
53,123 |
(1,438) |
(552) |
- |
- |
51,133 |
|
Other operating income, net |
(14,890) |
- |
- |
- |
- |
(14,890) |
|
Total operating expense |
74,365 |
(16,322) |
(552) |
- |
- |
57,491 |
|
Operating profit from continuing |
98,264 |
16,817 |
1,956 |
- |
- |
117,037 |
|
Profit from continuing operations |
102,346 |
16,817 |
1,956 |
- |
- |
121,119 |
|
Net profit from continuing |
65,334 |
16,817 |
1,956 |
9,499 |
- |
93,606 |
|
Net profit/ (loss) from discontinued |
(1,008) |
- |
806 |
- |
908 |
706 |
|
Net income attributable to Focus |
64,590 |
16,817 |
2,762 |
9,499 |
908 |
94,576 |
|
Basic net income from continuing |
0.52 |
0.74 | ||||
|
Diluted net income from continuing |
0.49 |
0.71 | ||||
|
Basic net income from discontinued |
(0.01) |
0.00 | ||||
|
Diluted net income from discontinued |
(0.01) |
0.00 | ||||
|
Basic net income attributable to Focus |
0.51 |
0.74 | ||||
|
Diluted net income attributable to Focus |
0.48 |
0.71 | ||||
|
ADS used in calculating basic income |
127,777,021 |
127,777,021 | ||||
|
ADS used in calculating diluted income |
133,518,344 |
133,518,344 | ||||
|
(1). Share-based compensation. (2). Amortization of acquired intangible assets. (3). Loss from equity method investee (VisionChina) (4). Goodwill impairment
| ||||||
|
Three months ended December 31, 2011 | |||||
|
GAAP |
(1) |
(2) |
(3) |
Non-GAAP | |
|
Gross Profit |
|||||
|
LCD display network |
112,179 |
286 |
1,100 |
- |
113,565 |
|
Poster frame network |
35,036 |
- |
890 |
- |
35,926 |
|
In-store network |
12,797 |
- |
- |
- |
12,797 |
|
Movie theater network |
13,803 |
- |
- |
- |
13,803 |
|
Traditional outdoor billboard network |
1,591 |
- |
459 |
- |
2,050 |
|
Total Gross Profit |
175,406 |
286 |
2,449 |
- |
178,141 |
|
General and administrative |
37,092 |
(14,267) |
- |
- |
22,825 |
|
Selling and marketing |
49,606 |
(1,029) |
(1,055) |
- |
47,522 |
|
Other operating income, net |
(8,181) |
- |
- |
- |
(8,181) |
|
Total operating expense |
78,517 |
(15,296) |
(1,055) |
- |
62,166 |
|
Operating profit from continuing |
96,889 |
15,582 |
3,504 |
- |
115,975 |
|
Profit before tax from continuing |
100,941 |
15,582 |
3,504 |
- |
120,027 |
|
Net profit from continuing |
37,037 |
15,582 |
3,504 |
38,882 |
95,005 |
|
Net loss from discontinued |
(1,538) |
980 |
(558) | ||
|
Net income attributable to Focus |
37,093 |
15,582 |
4,484 |
38,882 |
96,041 |
|
Basic net income from continuing |
0.29 |
0.73 | |||
|
Diluted net income from continuing |
0.28 |
0.70 | |||
|
Basic net income from discontinued |
(0.01) |
0.00 | |||
|
Diluted net income from discontinued |
(0.01) |
0.00 | |||
|
Basic net income attributable to Focus |
0.28 |
0.73 | |||
|
Diluted net income attributable to Focus |
0.27 |
0.70 | |||
|
ADS used in calculating basic income |
132,073,143 |
132,073,143 | |||
|
ADS used in calculating diluted |
136,912,952 |
136,912,952 | |||
|
(1). Share-based compensation. (2). Amortization of acquired intangible assets. (3). Loss from equity method investee (VisionChina)
| |||||
|
Focus Media Holding Ltd. Reconciliation of GAAP to non-GAAP (U.S. Dollar in thousands, except share and per-share data) (Unaudited) | ||||||
|
Twelve months ended December 31, 2012 | ||||||
|
GAAP |
(1) |
(2) |
(3) |
(4) |
Non-GAAP | |
|
Gross Profit (loss) |
||||||
|
LCD display network |
352,346 |
1,821 |
3,136 |
357,303 | ||
|
Poster frame network |
183,873 |
596 |
184,469 | |||
|
In-store network |
30,284 |
30,284 | ||||
|
Movie theater network |
43,994 |
43,994 | ||||
|
Traditional outdoor billboard network |
(2,592) |
1,805 |
(787) | |||
|
Total Gross Profit |
607,905 |
1,821 |
5,537 |
615,263 | ||
|
General and administrative |
136,704 |
(56,561) |
80,143 | |||
|
Selling and marketing |
194,095 |
(5,255) |
(2,260) |
186,580 | ||
|
Other operating income, net |
(38,588) |
(38,588) | ||||
|
Total operating expense |
292,211 |
(61,816) |
(2,260) |
228,135 | ||
|
Operating profit from continuing |
315,694 |
63,637 |
7,797 |
387,128 | ||
|
Profit before tax from continuing |
331,459 |
63,637 |
7,797 |
1,526 |
404,419 | |
|
Net profit from continuing |
237,001 |
63,637 |
7,797 |
20,087 |
328,522 | |
|
Net profit/ (loss) from |
(1,065) |
3,005 |
533 |
2, 473 | ||
|
Net income attributable to Focus |
238,078 |
63,637 |
10,802 |
20,087 |
533 |
333,137 |
|
Basic net income from continuing |
1.86 |
2.57 | ||||
|
Diluted net income from continuing |
1.80 |
2.48 | ||||
|
Basic net income from discontinued |
(0.01) |
0.02 | ||||
|
Diluted net income from discontinued |
(0.01) |
0.02 | ||||
|
Basic net income attributable to |
1.85 |
2.59 | ||||
|
Diluted net income attributable to |
1.79 |
2.50 | ||||
|
ADS used in calculating basic |
128,809,554 |
128,809,554 | ||||
|
ADS used in calculating diluted |
133,250,339 |
133,250,339 | ||||
|
(1). Share-based compensation. (2). Amortization of acquired intangible assets. (3). loss from equity investment, including equity method investee (VisionChina) and cost method investment (4). Loss from disposal of previously acquired subsidiaries, of which gain from disposal of subsidiaries was $0.4 million and loss from impairment of goodwill was $0.9 million.
| ||||||
|
Focus Media Holding Ltd. Reconciliation of GAAP to non-GAAP (U.S. Dollar in thousands, except percentages, share and per-share data) (Unaudited)
| |||||
|
Twelve months ended December 31, 2011 | |||||
|
GAAP |
(1) |
(2) |
(3) |
Non- GAAP | |
|
Gross Profit |
|||||
|
LCD display network |
358,518 |
880 |
4,409 |
- |
363,807 |
|
Poster frame network |
75,079 |
- |
4,175 |
- |
79,254 |
|
In-store network |
35,792 |
- |
- |
- |
35,792 |
|
Movie theater network |
25,082 |
- |
43 |
- |
25,125 |
|
Traditional outdoor billboard network |
7,610 |
- |
1,808 |
- |
9,418 |
|
Total Gross Profit |
502,081 |
880 |
10,435 |
- |
513,396 |
|
General and administrative |
126,518 |
(57,119) |
- |
- |
69,399 |
|
Selling and marketing |
146,392 |
(3,803) |
(4,220) |
- |
138,369 |
|
Other operating (income), net |
(16,147) |
- |
- |
- |
(16,147) |
|
Total operating expense |
256,763 |
(60,922) |
(4,220) |
- |
191,621 |
|
Operating profit from continuing |
245,318 |
61,802 |
14,655 |
- |
321,775 |
|
Profit before tax from continuing |
260,139 |
61,802 |
14,655 |
- |
336,596 |
|
Net profit from continuing |
161,790 |
61,802 |
14,655 |
43,633 |
281,880 |
|
Net profit from discontinued operations |
(978) |
- |
1,343 |
- |
365 |
|
Net income attributable to Focus |
162,677 |
61,802 |
15,998 |
43,633 |
284,110 |
|
Basic net income from continuing |
1.21 |
2.11 | |||
|
Diluted net income from continuing |
1.18 |
2.04 | |||
|
Basic net income from discontinued |
0.00 |
0.01 | |||
|
Diluted net income from discontinued |
0.00 |
0.01 | |||
|
Basic net income attributable to Focus |
1.21 |
2.12 | |||
|
Diluted net income attributable to |
1.18 |
2.05 | |||
|
ADS used in calculating basic income |
134,241,550 |
134,241,550 | |||
|
ADS used in calculating diluted income |
138,320,991 |
138,320,991 | |||
|
(1). Share-based compensation. (2). Amortization of acquired intangible assets. (3). Loss from equity method investee (VisionChina)
| |||||
CONFERENCE CALL
1) The Company will host a conference call to discuss the fourth quarter and full year 2012 results at 9:00 p.m. U.S. Eastern Time on March 25, 2013 (6:00 p.m. U.S. Pacific Time on March 25, 2013 and 9:00 a.m. Beijing/Hong Kong Time on March 26, 2013). The dial-in details for the live conference call are set forth below:
International Toll Dial-In Number: + 65.6723.9381
Local Dial-In Number(s):
China, Domestic Mobile: 400.620.8038
China, Domestic: 800.819.0121
Hong Kong: +852.2475.0994
United States: +1.718.354.1231
International Toll Free Dial-in Number(s):
Hong Kong: +852.800.930.346
United States: +1.866.519.4004
Conference ID # 23817537
2) A replay of the call will be available from 0:00 a.m. March 26 - 8:59 a.m. April 2, 2013 (US Eastern Time). The dial-in details for the replay are set forth below:
International Toll Dial-In Number: +61.2.8199.0299
Local Dial-In Number(s):
Hong Kong: +852.3051.2780
United States: +1.646.254.3697
International Toll Free Dial-in Number(s):
China 400: 400.120.0932
China 800: 800.870.0205
Hong Kong: +852.800.963.117
United States: +1.855.452.5696
Conference ID # 23817537
Additionally, a live and archived web cast of this call will be available on the Focus Media web site at http://ir.focusmedia.cn
SAFE HARBOR: FORWARD-LOOKING STATEMENTS
This press release includes statements that may constitute forward-looking statements made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Focus Media may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission on forms 20-F and 6-K., in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about Focus Media's beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. A number of important factors could cause actual results to differ materially from those contained in any forward-looking statement. Potential risks and uncertainties include, but are not limited to, risks outlined in Focus Media's filings with the U.S. Securities and Exchange Commission, including its registration statements on Form F-1, F-3 and 20-F, in each case as amended. Focus Media does not undertake any obligation to update any forward-looking statement, except as required under applicable law.
This release is not an offer of securities for sale in the United States. Securities may not be offered or sold in the United States absent registration or an exemption from registration. Any public offering of securities to be made in the United States will be made by means of a prospectus that may be obtained from the issuer or selling security holder and that will contain detailed information about the company and management, as well as financial statements.
ABOUT FOCUS MEDIA HOLDING LIMITED
Focus Media Holding Limited FMCN operates China's largest lifestyle targeted interactive digital media network. The Company offers one of the most comprehensive targeted interactive digital media platforms aimed at Chinese consumers at various urban locations. The increasingly fragmented and mobile lifestyle of Chinese urban consumers has created the need for more efficient media means to capture consumer attention. Focus Media's mission is to build an increasingly comprehensive and measurable interactive urban media network that reaches consumers at various out-of-home locations.
Focus Media Holding Limited | |||
|
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS | |||
|
(U.S Dollars in Thousands) | |||
|
2012-12-31 |
2012-09-30 |
2011-12-31 | |
|
ASSETS |
|||
|
Current assets |
|||
|
Cash and cash equivalents |
674,133 |
491,729 |
331,218 |
|
Restricted cash |
- |
99,043 |
99,673 |
|
Short-term investments |
115,125 |
211,238 |
226,047 |
|
Accounts receivable, net |
282,977 |
294,102 |
249,206 |
|
Prepaid expenses and other current assets |
83,048 |
71,616 |
62,604 |
|
Rental deposits |
57,152 |
60,739 |
60,913 |
|
Held-for-sale assets-current |
- |
4,660 |
- |
|
Other current assets |
2,418 |
2,262 |
3,222 |
|
Total current assets |
1,214,853 |
1,235,389 |
1,032,883 |
|
Restricted cash |
240,554 |
99,043 |
99,673 |
|
Rental deposits, non-current |
3,447 |
3,252 |
4,047 |
|
Equipment, net |
66,073 |
66,044 |
79,042 |
|
Acquired intangible assets, net |
3,326 |
4,776 |
35,025 |
|
Goodwill |
439,384 |
439,201 |
459,113 |
|
Equity method investment |
1,001 |
5,040 |
|
|
Held-for-sale assets-non-current |
- |
21,008 |
20,534 |
|
Other long term assets |
7,248 |
14,642 |
11,120 |
|
Total assets |
1,975,886 |
1,888,395 |
1,741,437 |
|
LIABILITIES AND EQUITY |
|||
|
Current liabilities |
|||
|
Short-term bank loan |
- |
100,000 |
100,000 |
|
Accounts payable |
14,810 |
16,828 |
19,448 |
|
Accrued expenses and other current liabilities |
179,441 |
188,569 |
173,754 |
|
Income taxes payable |
69,437 |
43,745 |
35,463 |
|
Amount due to related parties |
577 |
1,554 |
2,196 |
|
Held-for-sale liabilities-current |
- |
9,468 |
- |
|
Deferred tax liabilities |
31,464 |
29,339 |
33,550 |
|
Total current liabilities |
295,729 |
389,503 |
364,411 |
|
Long-term loan |
200,000 |
100,000 |
71,000 |
|
Acquisition purchase price payable |
- |
- |
13,106 |
|
Held-for-sale liabilities-non-current |
- |
6,159 |
- |
|
Deferred tax liabilities, non-current |
12,201 |
13,190 |
20,099 |
|
Total liabilities |
507,930 |
508,852 |
468,616 |
|
Equity |
|||
|
Ordinary shares |
33 |
32 |
32 |
|
Additional paid in capital |
1,561,435 |
1,548,446 |
1,533,617 |
|
Subscription receivable |
- |
- |
- |
|
Accumulated deficit |
(214,554) |
(291,226) |
(400,276) |
|
Accumulated other comprehensive income |
123,015 |
113,318 |
119,796 |
|
Total Focus Media equity |
1,469,929 |
1,370,570 |
1,253,169 |
|
Noncontrolling interests |
(1,973) |
8,973 |
19,652 |
|
Total equity |
1,467,956 |
1,379,543 |
1,272,821 |
|
Total liabilities and equity |
1,975,886 |
1,888,395 |
1,741,437 |
|
Focus Media Holding Limited | |||||
|
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||
|
(U.S Dollars in thousands, except earnings per ADS and ADS data) | |||||
|
Three months ended |
Twelve Months ended | ||||
|
2012-12-31 |
2012-9-30 |
2011-12-31 |
2012-12-31 |
2011-12-31 | |
|
Revenues |
|||||
|
LCD display network |
134,372 |
135,777 |
150,452 |
491,290 |
486,550 |
|
In-store network |
11,311 |
14,879 |
17,559 |
53,149 |
61,669 |
|
Poster frame network |
89,679 |
86,056 |
70,595 |
319,522 |
202,548 |
|
Movie theater network |
20,358 |
23,753 |
21,658 |
78,591 |
53,330 |
|
Traditional outdoor |
6,141 |
7,751 |
14,242 |
32,490 |
50,358 |
|
Total gross revenues |
261,861 |
268,216 |
274,506 |
975,042 |
854,455 |
|
Less: Sales taxes |
11,672 |
12,740 |
21,807 |
47,541 |
67,923 |
|
Total net revenue (note 1) |
250,189 |
255,476 |
252,699 |
927,501 |
786,532 |
|
Cost of revenues |
|||||
|
LCD display network |
30,025 |
29,976 |
25,229 |
113,135 |
85,847 |
|
In-store network |
5,254 |
5,384 |
3,258 |
21,504 |
20,582 |
|
Poster frame network |
28,903 |
29,268 |
29,511 |
117,685 |
110,370 |
|
Movie theater network |
8,924 |
8,762 |
6,980 |
32,661 |
25,753 |
|
Traditional outdoor |
5,777 |
9,457 |
12,315 |
34,611 |
41,899 |
|
Total cost of revenues |
78,883 |
82,847 |
77,293 |
319,596 |
284,451 |
|
Gross profit |
171,306 |
172,629 |
175,406 |
607,905 |
502,081 |
|
Operating expenses |
|||||
|
General and administrative |
32,968 |
36,132 |
37,092 |
136,704 |
126,518 |
|
Selling and marketing |
51,973 |
53,123 |
49,606 |
194,095 |
146,392 |
|
Other operating (income) |
(13,897) |
(14,890) |
(8,181) |
(38,588) |
(16,147) |
|
Total operating expenses |
71,044 |
74,365 |
78,517 |
292,211 |
256,763 |
|
Operating profit |
100,262 |
98,264 |
96,889 |
315,694 |
245,318 |
|
Interest income |
6,181 |
5,366 |
4,636 |
22,358 |
15,538 |
|
Interest expense |
(1,411) |
(1,284) |
(584) |
(5,067) |
(717) |
|
Loss from cost method |
(1,526) |
- |
- |
(1,526) |
- |
|
Income from continuing |
103,506 |
102,346 |
100,941 |
331,459 |
260,139 |
|
Provision for income taxes |
24,610 |
27,513 |
25,022 |
75,897 |
54,716 |
|
Loss from equity method |
2,600 |
9,499 |
38,882 |
18,561 |
43,633 |
|
Net income from |
76,296 |
65,334 |
37,037 |
237,001 |
161,790 |
|
Net loss from discontinued |
(232) |
(1,008) |
(1,538) |
(1,065) |
(978) |
|
Net income |
76,064 |
64,326 |
35,499 |
235,936 |
160,812 |
|
Less: Net loss attributable |
(608) |
(264) |
(1,594) |
(2,142) |
(1,865) |
|
Net income attributable |
76,672 |
64,590 |
37,093 |
238,078 |
162,677 |
|
Net income from continuing |
|||||
|
- basic |
0.59 |
0.52 |
0.29 |
1.86 |
1.21 |
|
- diluted |
0.57 |
0.49 |
0.28 |
1.80 |
1.18 |
|
Net income from discontinued |
|||||
|
- basic |
0.00 |
(0.01) |
(0.01) |
(0.01) |
0.00 |
|
- diluted |
0.00 |
(0.01) |
(0.01) |
(0.01) |
0.00 |
|
Net income attributable to |
|||||
|
- basic |
0.59 |
0.51 |
0.28 |
1.85 |
1.21 |
|
- diluted |
0.57 |
0.48 |
0.27 |
1.79 |
1.18 |
|
ADS used in calculating |
130,265,271 |
127,777,021 |
132,073,143 |
128,809,554 |
134,241,550 |
|
ADS used in calculating |
134,529,688 |
133,518,344 |
136,912,952 |
133,250,339 |
138,320,991 |
|
Focus Media Holding Limited | |||||
|
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | |||||
|
(U.S Dollars in thousands, except earnings per ADS and ADS data) | |||||
|
Three months ended |
Twelve months ended | ||||
|
2012-12-31 |
2012-09-30 |
2011-12-31 |
2012-12-31 |
2011-12-31 | |
|
Net income |
76,064 |
64,326 |
35,499 |
235,936 |
160,812 |
|
Other comprehensive |
|||||
|
Foreign currency |
9,687 |
(2,964) |
8,256 |
2,638 |
40,190 |
|
Share of post-acquisition |
76 |
(43) |
256 |
552 |
1,639 |
|
Comprehensive income |
85,827 |
61,319 |
44,011 |
239,126 |
202,641 |
|
Comprehensive loss |
(542) |
(286) |
(1,429) |
(2,171) |
(1,491) |
|
Comprehensive income |
86,369 |
61,605 |
45,440 |
241,297 |
204,132 |
Note 1: Details of net revenues by segment are as follows (U.S. Dollars in thousands):
|
Three months ended |
Twelve months ended | ||||
|
2012-12-31 |
2012-9-30 |
2011-12-31 |
2012-12-31 |
2011-12-31 | |
|
Gross revenues |
|||||
|
LCD display network |
134,372 |
135,777 |
150,452 |
491,290 |
486,550 |
|
In-store network |
11,311 |
14,879 |
17,559 |
53,149 |
61,669 |
|
Poster frame network |
89,679 |
86,056 |
70,595 |
319,522 |
202,548 |
|
Movie theater network |
20,358 |
23,753 |
21,658 |
78,591 |
53,330 |
|
Traditional outdoor |
6,141 |
7,751 |
14,242 |
32,490 |
50,358 |
|
Total gross revenues |
261,861 |
268,216 |
274,506 |
975,042 |
854,455 |
|
Less: Sales taxes |
|||||
|
LCD display network |
6,916 |
7,358 |
13,044 |
25,809 |
42,185 |
|
In-store network |
216 |
413 |
1,504 |
1,361 |
5,295 |
|
Poster frame network |
4,000 |
4,447 |
6,048 |
17,964 |
17,099 |
|
Movie theater network |
509 |
520 |
875 |
1,936 |
2,495 |
|
Traditional outdoor |
31 |
2 |
336 |
471 |
849 |
|
Total sales tax |
11,672 |
12,740 |
21,807 |
47,541 |
67,923 |
|
Net revenues |
|||||
|
LCD display network |
127,456 |
128,419 |
137,408 |
465,481 |
444,365 |
|
In-store network |
11,095 |
14,466 |
16,055 |
51,788 |
56,374 |
|
Poster frame network |
85,679 |
81,609 |
64,547 |
301,558 |
185,449 |
|
Movie theater network |
19,849 |
23,233 |
20,783 |
76,655 |
50,835 |
|
Traditional outdoor |
6,110 |
7,749 |
13,906 |
32,019 |
49,509 |
|
Total net revenues |
250,189 |
255,476 |
252,699 |
927,501 |
786,532 |
|
Focus Media Holding Limited UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASHFLOWS (U.S. Dollars in thousands) | |||||
|
Three months ended |
Twelve months ended | ||||
|
2012-12-31 |
2011-12-31 |
2012-12-31 |
2011-12-31 | ||
|
Operating activities: |
|||||
|
Net income |
76,064 |
35,499 |
235,936 |
160,812 | |
|
Adjustments to reconcile net income to net cash |
|||||
|
Bad debt expenses |
4,182 |
5,755 |
13,341 |
16,013 | |
|
Share-based compensation |
12,990 |
15,582 |
63,637 |
61,802 | |
|
Depreciation |
7,820 |
7,601 |
30,741 |
28,787 | |
|
Amortization of acquired intangible assets |
1,665 |
4,484 |
10,802 |
15,998 | |
|
Loss from cost method investee |
1,526 |
- |
1,526 |
- | |
|
Loss from equity method investee |
2,600 |
38,882 |
18,561 |
43,632 | |
|
Change in fair value of contingent consideration |
- |
- |
1,179 |
- | |
|
Others |
(1,523) |
(199) |
621 |
1,910 | |
|
Net changes in current assets and current liabilities, |
37,121 |
21,189 |
(18,094) |
(48,796) | |
|
Net cash provided by operating activities |
142,445 |
128,793 |
358,250 |
280,158 | |
|
Investing activities: |
|||||
|
Purchase of equipment and other long term assets |
(4,807) |
(15,494) |
(19,645) |
(38,918) | |
|
Payment paid to acquire subsidiaries, net of cash |
- |
(606) |
(2,929) |
(13,228) | |
|
Investment in equity method investee |
- |
- |
- |
(61,003) | |
|
Cash deposited as restricted cash |
(40,719) |
(199,346) |
(67,232) |
(199,346) | |
|
Cash received from the release of restricted cash |
26,366 |
||||
|
Proceeds received from the sale of short-term |
114,916 |
166,643 |
470,977 |
1,044,680 | |
|
Proceeds used in investment in short-term |
(16,937) |
(186,371) |
(359,595) |
(1,124,034) | |
|
Proceeds received from disposal of fixed assets |
69 |
100 |
409 |
672 | |
|
Proceeds from disposal of subsidiaries |
1,392 |
- |
2,519 |
7,296 | |
|
Cash of disposed entities |
(596) |
- |
(2,378) |
- | |
|
Net cash provided by/(used in) investing |
53,318 |
(235,074) |
48,492 |
(383,881) | |
|
Financing activities: |
|||||
|
Proceeds from short-term loan |
- |
145,000 |
34,794 |
175,000 | |
|
Repayment of short-term loan |
(100,000) |
(75,000) |
(134,017) |
(75,000) | |
|
Proceeds from long-term loan |
200,000 |
71,000 |
229,000 |
71,000 | |
|
Repayment from long-term loan |
(100,000) |
- |
(100,000) |
- | |
|
Cash used for share repurchase |
- |
(144,269) |
(41,445) |
(213,375) | |
|
Dividend payout |
(17,846) |
- |
(53,148) |
- | |
|
(Repayment to) capital injection from noncontrolling |
- |
(321) |
- |
(397) | |
|
Proceeds from issuance of ordinary shares, net of |
- |
1,236 |
34 |
3,063 | |
|
Net cash provided by/(used in) financing activities |
(17,846) |
(2,354) |
(64,782) |
(39,709) | |
|
Effect of exchange rate changes |
3,504 |
4,531 |
955 |
20,174 | |
|
Net increase in cash and cash equivalents |
181,421 |
(104,104) |
342,915 |
(123,258) | |
|
Cash and cash equivalents, beginning of period |
491,729 |
435,322 |
331,218 |
454,476 | |
|
Add: Cash and cash equivalents in held-for-sale |
983 |
- |
- |
- | |
|
Cash and cash equivalents, end of period |
674,133 |
331,218 |
674,133 |
331,218 | |
|
Supplemental disclosure of cash flow information: |
|||||
|
Income taxes paid |
2,684 |
2,970 |
39,791 |
27,582 | |
|
Interest paid |
1,487 |
560 |
4,885 |
665 | |
|
Supplemental disclosure of non-cash investing |
|||||
|
Accrual for acquisition of subsidiaries |
671 |
19,584 |
671 |
19,584 | |
SOURCE Focus Media Holding Limited
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