Glory Star New Media Group Holdings Limited (NASDAQ: GSMG, GSMGW)
(“Glory Star” or the “Company”), a leading mobile and online
digital media and entertainment company in China, today announced
its financial results for the second quarter and half year ended
June 30, 2020.
Second Quarter and Half Year 2020 Key Metrics
Highlights
- Downloads of the CHEERS
App1 exceeded 121.0 million as of June 30, 2020, compared
to 35.5 million as of June 30, 2019.
- Average daily active users
(“DAUs”)2 of the CHEERS App increased to 4.9 million for
the three months ended June 30, 2020 from 1.0 million in the same
period of 2019. DAUs of CHEERS App increased to 4.5 million for the
six months ended June 30, 2020 from 0.7 million in the same period
of 2019.
- Stock Keeping Units
(“SKUs”) carried in the Company’s e-Mall were 19,984 as of
June 30, 2020, compared to 3,000 as of June 30, 2019.
- Gross Merchandise Value
(GMV)3 in the three month ended June 30, 2020 was over
$14.1 million, compared to $1.0 million in the same period of 2019.
GMVs in the six months ended June 30, 2020 was approximately $20.0
million, compared to $1.0 million in the same period of 2019.
Second Quarter and Half Year 2020 Financial
Highlights
- Total revenues in
the second quarter of 2020 increased by 6.3% to $19.7 million as
compared to $18.5 million in the same quarter of 2019. For the
first half of 2020, total revenues decreased by 8.8% to $29.4
million, compared to $32.2 million in the same period of
2019.
- Total operating
expenses in the second quarter of 2020 decreased by 7.2%
to $11.1 million as compared to $11.9 million in the same quarter
of 2019. For the first half of 2020, total operating expenses
decreased by 15.5% to $17.9 million, compared to $21.2 million in
the same period of 2019.
- Income from
operations in the second quarter of 2020 increased by
30.7% to $8.6 million as compared to $6.6 million in the same
quarter of 2019. For the first half of 2020, income from operations
increased by 4.2% to $11.5 million, compared to $11.0 million in
the same period of 2019.
- Non-GAAP income from
operations4 in the second quarter of 2020 increased by
68.9% to $11.1 million as compared to $6.6 million in the same
quarter of 2019. For the first half of 2020, non-GAAP income from
operations increased by 27.7% to $14.1 million, compared to $11.0
million in the same period of 2019.
- Net income attributable to
ordinary shareholders in the second quarter of 2020
increased by 37.4% to $9.1 million as compared to $6.6 million in
the same quarter of 2019. For the first half of 2020, net income
attributable to ordinary shareholders increased by 11.5% to $12.0
million, compared to $10.7 million in the same period of 2019.
- Non-GAAP net income
attributable to ordinary shareholders5 in the second
quarter of 2020 increased by 75.4% to $11.6 million as compared to
$6.6 million in the same quarter of 2019. For the first half of
2020, non-GAAP net income attributable to ordinary shareholders
increased by 35.5% to $14.6 million, compared to $10.7 million in
the same period of 2019.
_______
- Glory Star defines this metric as
the total number of downloads of the CHEERS App as of the end of
the period.
- Glory Star defines daily active
users, or DAUs, as a user who has logged in or access Glory Star’s
online video content and/or its e-commerce platform using the
CHEERS App, whether on a mobile phone or tablet. Glory Star
calculates DAUs using internal company data based on the activity
of the user account and as adjusted to remove “duplicate”
accounts.
- Glory Star defines gross
merchandise value, or GMV, as the total value of all orders for
products and services placed in our online direct sales business
and on our online marketplaces, regardless of whether the goods are
sold or delivered or whether the goods are returned.
- Non-GAAP income from operations is
defined as income from operations excluding share-based
compensation expenses. See “Glory Star New Media Group Holdings
Limited Reconciliation of GAAP and Non-GAAP results” set forth at
the end of this press release.
- Non-GAAP net income attributable to
ordinary shareholders is defined as net income attributable to
ordinary shareholders excluding share-based compensation expenses.
See “Glory Star New Media Group Holdings Limited Reconciliation of
GAAP and Non-GAAP results” set forth at the end of this press
release.
Mr. Bing Zhang, Founder and Chief Executive
Officer of Glory Star, commented, “We concluded the second quarter
of 2020 with solid financial and operating results as we leveraged
our state-of-the art technology and premium content production
capabilities to form additional partnerships and grow our
e-commerce marketplace in the period. Since May, the outbreak of
COVID-19 has been gradually brought under control in China, and we
have thus been able to resume producing our industry-leading
lifestyle content and providing highly-effective content marketing
services to our partners. As a result, we grew our CHEERS e-Mall
user base and established more partnerships with internationally
renowned luxury brands in the second quarter to further solidify
out content leadership at the high-end of China’s luxury e-commerce
market. In line with these successes, our CHEERS e-Mall continued
to perform well in the period, especially during the 6.18
e-commerce shopping festival in 2020. Looking ahead, we plan to
continue bolstering our in-house content production capabilities,
expanding our e-commerce platform, and developing those marketing
solutions capable of meeting our industry partners’ needs. We
remain confident that our superior content production capabilities
and unique ability to engage with China’s younger demographic will
not only help to fuel our growth momentum, but also deliver lasting
shareholder value over the long term.”
Mr. Ian Lee, Chief Financial Officer of Glory
Star, added, “We are pleased to report another quarter of strong
financial growth in spite of the challenging macro environment.
GSMG delivered solid financial performance across our key financial
metrics of revenue, cost reduction, profitability, and operating
efficiency. Looking ahead, we remain committed to further
optimizing our operating efficiency through cost structure
management while also investing in those initiatives that are
capable of enhancing our content production capabilities going
forward. ”
Second Quarter and Half Year 2020 Key
Metrics
We monitor the following key metrics to evaluate
the growth of our business, measure the effectiveness of our
marketing efforts, identify trends affecting our business, and make
strategic decisions:
CHEERS App Downloads. We define
this metric as the total number of downloads of the CHEERS App as
of the end of the period. Because we have expanded into e-commerce
through our CHEERS App, we believe that this is a key metric in
understanding the growth in this business. The number of downloads
demonstrates whether we are successful in our marketing efforts in
converting viewers of our professionally-produced content on other
platforms to the CHEERS App. We view the number of downloads at the
end of a given period as a key indicator of the attractiveness and
usability of our CHEERS App and the increased traffic to our e-Mall
platform. As of June 30, 2020, downloads of the CHEERS App exceeded
121.0 million as compared to 35.5 million as of June 30, 2019. We
believe that this increase in downloads demonstrates the success
that we have in converting viewers of our content to the CHEERS
App.
Daily Active Users (DAUs). We
define daily active users, or DAUs, as a user who has logged in or
accessed our online video content and/or our e-commerce platform
using the CHEERS App, whether on a mobile phone or tablet. We
calculate DAUs using internal company data based on the activity of
the user account and as adjusted to remove “duplicate” accounts.
DAU is a tool that our management uses to manage their operations.
In particular, our management sets daily targets of DAUs and
monitors the DAUs to see whether to make adjustments as to the
promotional activities, advertising campaign, and/or online video
contents. For the three months ended June 30, 2019 and 2020, the
average DAUs were 1.0 million and 4.9 million, respectively. For
the six months ended June 30, 2019 and 2020, the average DAUs were
0.7 million and 4.5 million,
respectively.
Gross Merchandise Value (GMV).
We define gross merchandise value, or GMV, as the total value of
all orders for products and services placed in our online direct
sales business and on our online marketplaces, regardless of
whether the goods are sold or delivered or whether the goods are
returned. As we grow our e-Mall platform, it is important to
monitor the volume of merchandise that we have sold through the
e-Mall. By keeping track of the GMV, it allows us to determine the
attractiveness of our CHEERS App platform to our merchants and
users. As of June 30, 2020, the Company’s e-Mall has carried 19,984
SKUs in total, compared to 3,000 as of June 30, 2019. For the three
and six months ended June 30, 2020, our e-Mall has recorded over
$14.1 million and $20.0 million of GMV, respectively, achieving an
impressive monthly GMV of $7.7 million in June 2020, up from only
$0.5 million in June 2019. We believe that the growth in the GMV
will be driven significantly with our ability to attract and retain
users to the CHEERS App through our professionally-produced content
and to further enhance our product offerings.
COVID-19 Affecting Our Results of
Operations
In December 2019, COVID-19 started to spread in
China, and then to other parts of the world in early 2020. The
COVID-19 pandemic has resulted in quarantines, travel restrictions,
and temporary closure of stores and facilities in China and
elsewhere.
With the rapid spread of COVID-19, the global
economy is under tremendous pressure and has triggered
unprecedented policy changes in governments around the world.
However, if the epidemic is not controlled in a timely manner, this
could adversely affect businesses in China. We are closely
monitoring the development of COVID-19 and continuously evaluate
the potential impact on us and our industry.
Although the COVID-19 outbreak may materially
adversely affect the global economy, there is a high rapid growth
in the online entertainment and online consumption due to the
restriction on outdoor activities. We have seen a rapid growth in
our mobile and online operation during this period. As of June 30,
2020, the number of downloads of our CHEERS App increased by 241%
compared to the number of downloads as of June 30, 2019. During the
second quarter of 2020, DAUs increased by 409% and the monthly
active users (“MAUs”) also received a 266% increase compared to the
second quarter of 2019. Compared to the first half of 2019, DAUs
increased by 522%, and the monthly active users (“MAUs”) also
received a 342% increase. The total video playback volume has
exceeded 17.1 billion, which is a 308% increase as compared to the
total video playback volume as of June 30, 2019.
Second Quarter and Half Year 2020 Financial
Results
Second quarter 2020 Financial
Results
Revenues in the second quarter
of 2020 increased by 6.3% to $19.7 million from $18.5 million in
the same quarter of 2019, which was mainly due to the increase in
advertising revenues. The advertising revenues in the second
quarter of 2020 increased by $1.9 million, or 13.7%, as compared to
$13.6 in the same period of 2019. Our advertisements are mainly
embedded in short videos, our CHEERS App and live streams. As
COVID-19 persists, people’s social habits have been changing
dramatically, such as reducing outdoor activities and switching to
increase online entertainment. Online advertising revenue growth
became prominent in the second quarter of 2020 under this new
stimulus.
Total operating expenses in the
second quarter of 2020 decreased by 7.2% to $11.1 million from
$11.9 million in the same period of 2019.
- Cost of revenues
in the second quarter of 2020 decreased by 46.5% to $5.4 million
from $10.1 million in the same period of 2019. The decrease was
mainly arising from the reduction of outsourcing the production of
short videos due to travel restrictions and quarantine during
COVID-19 outbreak. In addition, it is also attributed by the
decrease of expenditure on the payments to various channel owners
for broadcast advertisements, as we made more use of our own
platform on our CHEERS App that has already attracted a large
number of users to provide advertising services.
- Sales and marketing
expenses in the second quarter of 2020 increased by 289.3%
to $1.8 million from $0.5 million in the same period of 2019. It is
mainly due to the increase in offline promotion and sales promotion
for CHEERS E-mall (e.g. coupons and reward points provided to users
on CHEERS e-Mall to stimulate platform consumption).
- General and administrative
expenses in the second quarter of 2020 increased by 229.8%
to $3.8 million from $1.1 million in the same period of 2019. It is
mainly due to share-based compensation expenses that occurred in
the second quarter of 2020.
- Research and development
expenses in the second quarter of 2020 decreased by 48.2%
to $0.1 million from $0.3 million in the same period of 2019.
Income from operations in the second quarter of
2020 was $8.6 million, compared to $6.6 million in the same period
of 2019. Operating margin in the second quarter of 2020 increased
to 43.6% from 35.5% in the same period of 2019.
Non-GAAP income from operations
in the second quarter of 2020 was $11.1 million, compared to $6.6
million in the same period of 2019.
Net income attributable to ordinary
shareholders in the second quarter of 2020 was $9.1
million, compared to $6.6 million in the same period of 2019. Net
margin in the second quarter of 2020 increased to 46.2% from 35.7%
in the same period of 2019.
Non-GAAP net income attributable to
ordinary shareholders in the second quarter of 2020 was
$11.6 million, compared to $6.6 million in the same period of
2019.
Basic and diluted earnings per
share in the second quarter of 2020 were $0.17 and $0.16,
respectively. In comparison, the Company’s basic and diluted
earnings per share in the same quarter of 2019 were $0.16 and
$0.14, respectively.
Non-GAAP basic and diluted earnings per
share in the second quarter of 2020 were $0.21 and $0.21,
respectively, compared with non-GAAP basic and diluted earnings per
share of $0.16 and $0.14 in the same quarter of 2019,
respectively.
Net cash provided by operating
activities in the second quarter of 2020 was $0.1 million,
compared with $1.8 million in the same quarter of 2019.
First Half 2020 Financial
Results
Revenues in the first half of 2020 decreased by
8.8% to $29.4 million from $32.2 million in the same period of
2019. The decrease was mainly due to our sluggish performance in
the first quarter of 2020 as a result of serious adverse impact of
the COVID-19 and temporary termination of live streams for strategy
transition that was resumed in the second quarter of 2020. Our
revenues for first quarter of 2020 decreased by $4.0 million, or
29.06%, to $9.8 million compared to $13.8 million for the first
quarter of 2019. During the second quarter of 2020, with the work
resumption within China after COVID-19 outbreak, the Company was
able to produce new TV series and enough short videos to meet the
increased demands of online advertising services. Additionally,
live streams business line was resumed with new business model to
provide naming services. As disclosed above, revenues in the second
quarter of 2020 increased by 6.3% to $19.7 million from $18.5
million in the same quarter of 2019.
Total operating expenses in the
half year of 2020 decreased by 15.5% to $17.9 million from $21.2
million in the same period of 2019.
Cost of revenues in the half
year of 2020 decrease by 43.2% to $10.4 million from $18.3 million
in the same period of 2019, which was in line with the decrease of
revenues. The incremental decrease was attributed by the decrease
of expenditure on outsourcing the production of short videos due to
travel restrictions and quarantine during the COVID-19 outbreak, as
well as the payments to various channel owners for broadcast
advertisements, as we made more use of our own platform on our
CHEERS App which has already attracted a large number of users to
provide advertising services.
Sales and marketing expenses in
the half year of 2020 increased by 200.7% to $2.2 million from $0.7
million in the same period of 2019, mainly due to an increase in
offline promotion and sales promotion for CHEERS E-mall (e.g.
coupons and reward points provided to users on CHEERS e-Mall to
stimulate platform consumption).
General and administrative
expenses in the half year of 2020 increased by 183.9% to
$5.1 million from $1.8 million in the same period of 2019, mainly
due to an increase in share-based compensation expenses.
Research and development
expenses in the half year of 2020 decrease by 25.0% to
$0.3 million from $0.4 million in the same period of 2019, mainly
due to a postponement in spending for research and development
during the COVID-19 outbreak.
Income from operations in the
half year of 2020 was $11.5 million, compared to $11.0 million in
the same period of 2019. Operating margin in the half year of 2020
increased to 39.0% from 34.1% in the same period of 2019.
Non-GAAP income from operations
in the half year of 2020 was $14.1 million, compared to $11.0
million in the same period of 2019.
Net income attributable to ordinary
shareholders in the half year of 2020 was $12.0 million,
compared to $10.7 million in the same period of 2019. Net margin in
the half year of 2020 increased to 40.7% from 33.3% in the same
period of 2019.
Non-GAAP net income attributable to
ordinary shareholders in the half year of 2020 was $14.6
million, compared to $10.7 million in the same period of 2019.
Basic and diluted earnings per
share in the half year of 2020 were $0.24 and $0.23,
respectively. In comparison, the Company’s basic and diluted
earnings per share in the same period of 2019 were $0.26 and $0.23,
respectively.
Non-GAAP basic and diluted earnings per
share in the half year of 2020 were $0.29 and $0.28,
respectively, compared with non-GAAP basic and diluted earnings per
share of $0.26 and $0.23 in the same period of 2019,
respectively.
Net cash used in operating
activities in the half year of 2020 was $1.0 million,
compared to net cash provided by operating activities of $4.6
million in the same period of 2019.
Cash and cash equivalents
As of June 30, 2020, the Company had
cash and cash equivalents of $9.1 million,
compared to $6.9 million as of December 31, 2019.
About Glory Star New Media Group
Holdings Limited
Glory Star New Media Group Holdings Limited is a
leading mobile entertainment operator in China. Glory Star’s
ability to integrate premium lifestyle content, including short
videos, online variety shows, online dramas, live streaming, its
Cheers lifestyle TV series, e-Mall, and mobile app, along with
innovative e-commerce offerings on its platform enables it to
pursue its mission of enriching people’s lives. The Company’s large
and active user base creates valuable engagement opportunities with
consumers and enhances platform stickiness with thousands of
domestic and international brands.
Use of Non-GAAP Financial
Measures
In evaluating the business, the Company
considers and uses non-GAAP measures, such as non-GAAP operating
income/(loss) and non-GAAP net income/(loss) attributable to
ordinary shareholders, as supplemental measures to review and
assess operating performance. The presentation of these 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 accounting principles generally
accepted in the United States of America (“U.S. GAAP”). The Company
defines non-GAAP operating income/ (loss) as operating income/
(loss) excluding share-based compensation expenses. The Company
defines non-GAAP net income/ (loss) attributable to ordinary
shareholders as net income/ (loss) attributable to ordinary
shareholders excluding share-based compensation expenses.
The Company presents these non-GAAP financial
measures because they are used by management to evaluate operating
performance and formulate business plans. The Company believes that
the non-GAAP financial measures help identify underlying trends in
its business by excluding the impact of share-based compensation
expenses, which is a non-cash charge. The Company also believes
that the non-GAAP financial measures could provide further
information about the Company’s results of operations, and enhance
the overall understanding of the Company’s past performance and
future prospects.
The non-GAAP financial measures are not defined
under U.S. GAAP and are not presented in accordance with U.S. GAAP.
The non-GAAP financial measures have limitations as analytical
tools. The Company’s non-GAAP financial measures do not reflect all
items of income and expense that affect the Company’s operations
and do not represent the residual cash flow available for
discretionary expenditures. Further, these non-GAAP measures may
differ from the non-GAAP information used by other companies,
including peer companies, and therefore their comparability may be
limited. The Company compensates for these limitations by
reconciling the non-GAAP financial measures to the nearest U.S.
GAAP performance measure, all of which should be considered when
evaluating performance. The Company encourages you to review the
Company’s financial information in its entirety and not rely on a
single financial measure.
For more information on the non-GAAP financial
measures, please see the table captioned “Glory Star New Media
Group Holdings Limited Reconciliation of GAAP and Non-GAAP results”
set forth at the end of this press release.
Safe Harbor Statement
Certain statements made in this release are
“forward looking statements” within the meaning of the “safe
harbor” provisions of the United States Private Securities
Litigation Reform Act of 1995. When used in this press release, the
words “estimates,” “projected,” “expects,” “anticipates,”
“forecasts,” “plans,” “intends,” “believes,” “seeks,” “may,”
“will,” “should,” “future,” “propose” and variations of these words
or similar expressions (or the negative versions of such words or
expressions) are intended to identify forward-looking statements.
These forward-looking statements are not guarantees of future
performance, conditions or results, and involve a number of known
and unknown risks, uncertainties, assumptions and other important
factors, many of which are outside the Company’s control, that
could cause actual results or outcomes to differ materially from
those discussed in the forward-looking statements. Important
factors, among others, are: the ability to manage growth; ability
to identify and integrate other future acquisitions; ability to
obtain additional financing in the future to fund capital
expenditures; fluctuations in general economic and business
conditions; costs or other factors adversely affecting our
profitability; litigation involving patents, intellectual property,
and other matters; potential changes in the legislative and
regulatory environment; a pandemic or epidemic. The forward-looking
statements contained in this release are also subject to other
risks and uncertainties, including those more fully described in
the Company’s filings with the Securities and Exchange Commission,
including the Company’s Annual Report on Form 10-K filed with the
SEC on March 31, 2020, the Current Report on Form 8-K/A(Amendment
No. 2) filed with the SEC on March 31, 2020, which may be amended
from time to time, and in our Quarterly Report on Form 6-K that
will be filed following this earnings release. The Company
undertakes no obligation to update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise, except as required by applicable law. Such
information speaks only as of the date of this release.
Contacts:
Glory Star New Media Group Holdings
LimitedIan LeeEmail:
ianlee@yaoshixinghui.com
GLORY STAR NEW MEDIA GROUP HOLDINGS
LIMITED CONDENSED CONSOLIDATED BALANCE SHEETS (In U.S. dollars in
thousands, except share and per share data)
|
|
|
December 31, 2019 |
|
|
June 30, 2020 |
|
| |
|
|
|
|
(Unaudited) |
|
| Assets |
|
|
|
|
|
|
| Current assets: |
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
6,919 |
|
|
$ |
9,056 |
|
|
Accounts receivable, net |
|
|
51,061 |
|
|
|
59,327 |
|
|
Prepayment and other current assets |
|
|
2,499 |
|
|
|
10,203 |
|
| Total
current assets |
|
|
60,479 |
|
|
|
78,586 |
|
|
Property and equipment, net |
|
|
331 |
|
|
|
241 |
|
|
Intangible assets, net |
|
|
14,683 |
|
|
|
14,683 |
|
|
Deferred tax assets |
|
|
533 |
|
|
|
987 |
|
|
Unamortized produced content, net |
|
|
1,657 |
|
|
|
2,175 |
|
|
Right-of-use assets |
|
|
2,027 |
|
|
|
1,596 |
|
| Total
non-current assets |
|
|
19,231 |
|
|
|
19,682 |
|
| TOTAL
ASSETS |
|
$ |
79,710 |
|
|
$ |
98,268 |
|
| |
|
|
|
|
|
|
|
|
| Liabilities
and Equity |
|
|
|
|
|
|
|
|
| Current
liabilities: |
|
|
|
|
|
|
|
|
|
Short-term bank loans |
|
$ |
718 |
|
|
$ |
3,680 |
|
|
Accounts payable |
|
|
4,546 |
|
|
|
6,731 |
|
|
Advances from customers |
|
|
610 |
|
|
|
530 |
|
|
Accrued liabilities and other payables |
|
|
6,134 |
|
|
|
5,579 |
|
|
Other taxes payable |
|
|
1,890 |
|
|
|
2,103 |
|
|
Operating lease liabilities -current |
|
|
313 |
|
|
|
296 |
|
|
Due to related parties |
|
|
1,525 |
|
|
|
1,201 |
|
|
Convertible promissory note - related party |
|
|
- |
|
|
|
1,400 |
|
| Total
current liabilities |
|
|
15,736 |
|
|
|
21,520 |
|
|
Long-term bank loan |
|
|
- |
|
|
|
1,274 |
|
|
Operating lease liabilities - non-current |
|
|
1,718 |
|
|
|
1,322 |
|
| Total
non-current liabilities |
|
|
1,718 |
|
|
|
2,596 |
|
| TOTAL
LIABILITIES |
|
$ |
17,454 |
|
|
$ |
24,116 |
|
| |
|
|
|
|
|
|
|
|
| Commitments
and contingences |
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
Shareholders’ equity |
|
|
|
|
|
|
|
|
|
Preferred shares (par value of $0.0001 per share; 2,000,000
authorized; none issued and outstanding) |
|
$ |
- |
|
|
$ |
- |
|
|
Ordinary shares (par value of $0.0001 per share; 200,000,000 shares
authorized as of December 31, 2019 and June 30, 2020; 41,204,025
and 56,011,366 shares issued and outstanding as of December 31,
2019 and June 30, 2020, respectively) |
|
$ |
4 |
|
|
$ |
6 |
|
|
Additional paid-in capital |
|
|
13,375 |
|
|
|
14,365 |
|
|
Statutory reserve |
|
|
431 |
|
|
|
431 |
|
|
Retained earnings |
|
|
49,547 |
|
|
|
61,525 |
|
|
Accumulated other comprehensive loss |
|
|
(1,576 |
) |
|
|
(2,548 |
) |
| TOTAL GLORY
STAR NEW MEDIA GROUP HOLDINGS LIMITED SHAREHOLDERS’ EQUITY |
|
|
61,781 |
|
|
|
73,779 |
|
|
Non-controlling interest |
|
|
475 |
|
|
|
373 |
|
| TOTAL
EQUITY |
|
|
62,256 |
|
|
|
74,152 |
|
| |
|
|
|
|
|
|
|
|
| TOTAL
LIABILITIES AND EQUITY |
|
$ |
79,710 |
|
|
$ |
98,268 |
|
GLORY STAR NEW MEDIA GROUP HOLDINGS
LIMITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In U.S.
dollars in thousands, except share and per share
data)(Unaudited)
| |
|
For the Three Months Ended June 30, |
|
|
For the Six Months Ended June 30, |
|
|
|
|
2019 |
|
|
2020 |
|
|
2019 |
|
|
2020 |
|
|
Revenues(a) |
|
$ |
18,494 |
|
|
$ |
19,651 |
|
|
$ |
32,246 |
|
|
$ |
29,408 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenues |
|
|
(10,080 |
) |
|
|
(5,392 |
) |
|
|
(18,292 |
) |
|
|
(10,383 |
) |
|
Selling and marketing |
|
|
(456 |
) |
|
|
(1,775 |
) |
|
|
(716 |
) |
|
|
(2,153 |
) |
|
General and administrative |
|
|
(1,147 |
) |
|
|
(3,783 |
) |
|
|
(1,786 |
) |
|
|
(5,070 |
) |
|
Research and development |
|
|
(251 |
) |
|
|
(130 |
) |
|
|
(448 |
) |
|
|
(336 |
) |
| Total
operating expenses |
|
|
(11,934 |
) |
|
|
(11,080 |
) |
|
|
(21,242 |
) |
|
|
(17,942 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Income
from operations |
|
|
6,560 |
|
|
|
8,571 |
|
|
|
11,004 |
|
|
|
11,466 |
|
| Other
(expenses) income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense, net |
|
|
(82 |
) |
|
|
(82 |
) |
|
|
(218 |
) |
|
|
(169 |
) |
|
Other (expenses) income, net |
|
|
(3 |
) |
|
|
92 |
|
|
|
(8 |
) |
|
|
123 |
|
| Total
other expenses |
|
|
(85 |
) |
|
|
10 |
|
|
|
(226 |
) |
|
|
(46 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Income
before income tax |
|
|
6,475 |
|
|
|
8,581 |
|
|
|
10,778 |
|
|
|
11,420 |
|
| Income tax
(expense) benefit |
|
|
64 |
|
|
|
459 |
|
|
|
(107 |
) |
|
|
464 |
|
| Net
income |
|
|
6,539 |
|
|
|
9,040 |
|
|
|
10,671 |
|
|
|
11,884 |
|
| Less: net
loss attributable to non-controlling interests |
|
|
(65 |
) |
|
|
(36 |
) |
|
|
(74 |
) |
|
|
(94 |
) |
|
Net income attributable to Glory Star New Media Group
Holdings Limited’s shareholders |
|
$ |
6,604 |
|
|
$ |
9,076 |
|
|
$ |
10,745 |
|
|
$ |
11,978 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Other
comprehensive income (loss) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Unrealized
foreign currency translation gain (loss) |
|
|
(765 |
) |
|
|
108 |
|
|
|
(188 |
) |
|
|
(979 |
) |
|
Comprehensive income |
|
|
5,774 |
|
|
|
9,148 |
|
|
|
10,483 |
|
|
|
10,905 |
|
| Less:
comprehensive loss attributable to non-controlling interests |
|
|
(70 |
) |
|
|
(35 |
) |
|
|
(69 |
) |
|
|
(102 |
) |
|
Comprehensive income attributable to Glory Star New Media
Group Holdings Limited’s shareholders |
|
$ |
5,844 |
|
|
$ |
9,183 |
|
|
$ |
10,552 |
|
|
$ |
11,007 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Earnings per ordinary share |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.16 |
|
|
$ |
0.17 |
|
|
$ |
0.26 |
|
|
$ |
0.24 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Weighted average shares used in calculating earnings per
ordinary share |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
41,204,025 |
|
|
|
54,749,415 |
|
|
|
41,204,025 |
|
|
|
50,127,122 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Earnings per ordinary share |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dilutive |
|
$ |
0.14 |
|
|
$ |
0.16 |
|
|
$ |
0.23 |
|
|
$ |
0.23 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Weighted average shares used in calculating earnings per
ordinary share |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dilutive |
|
|
46,484,025 |
|
|
|
56,074,415 |
|
|
|
46,484,025 |
|
|
|
51,452,122 |
|
Note:
| |
(a) |
The following table identifies the disaggregation of our
revenue for the three months and six months ended June 30, 2019 and
2020, respectively: |
| |
|
For the Three Months Ended June 30, |
|
|
For the Six Months Ended June 30, |
|
| |
|
2019 |
|
|
2020 |
|
|
2019 |
|
|
2020 |
|
| |
|
(Unaudited) |
|
|
(Unaudited) |
|
|
(Unaudited) |
|
|
(Unaudited) |
|
| Category of Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Advertising revenue |
|
$ |
13,578 |
|
|
$ |
15,436 |
|
|
$ |
23,980 |
|
|
$ |
23,316 |
|
| Copyrights
revenue |
|
|
2,092 |
|
|
|
1,278 |
|
|
|
4,817 |
|
|
|
2,270 |
|
| Customized
content production revenue |
|
|
812 |
|
|
|
222 |
|
|
|
1,432 |
|
|
|
510 |
|
| CHEERS
E-mall marketplace service revenue |
|
|
- |
|
|
|
352 |
|
|
|
- |
|
|
|
402 |
|
| Other
revenue |
|
|
2,012 |
|
|
|
2,363 |
|
|
|
2,017 |
|
|
|
2,910 |
|
| Total |
|
$ |
18,494 |
|
|
$ |
19,651 |
|
|
$ |
32,246 |
|
|
$ |
29,408 |
|
GLORY STAR NEW MEDIA GROUP HOLDINGS
LIMITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In U.S.
dollars in
thousands)(Unaudited)
| |
|
For the Three Months Ended June 30, |
|
|
For the Six Months Ended June 30, |
|
| |
|
2019 |
|
|
2020 |
|
|
2019 |
|
|
2020 |
|
|
Net cash provided by (used in) operating activities |
|
$ |
1,849 |
|
|
$ |
112 |
|
|
$ |
4,567 |
|
|
$ |
(1,006 |
) |
| Net cash
provided by (used in) investing activities |
|
|
17 |
|
|
|
(994 |
) |
|
|
(2,332 |
) |
|
|
(994 |
) |
| Net cash
(used in) provided by financing activities |
|
|
(1,868 |
) |
|
|
- |
|
|
|
(3,389 |
) |
|
|
4,322 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Effect of
exchange rate changes |
|
$ |
(44 |
) |
|
$ |
(23 |
) |
|
$ |
8 |
|
|
$ |
(185 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net
(decrease) increase in cash, cash equivalents and restricted
cash |
|
|
(46 |
) |
|
|
(905 |
) |
|
|
(1,146 |
) |
|
|
2,137 |
|
| Cash,
cash equivalents and restricted cash, at beginning of year |
|
|
1,337 |
|
|
|
9,961 |
|
|
|
2,437 |
|
|
|
6,919 |
|
| Cash,
cash equivalents and restricted cash, at end of year |
|
$ |
1,291 |
|
|
$ |
9,056 |
|
|
$ |
1,291 |
|
|
$ |
9,056 |
|
GLORY STAR NEW MEDIA GROUP HOLDINGS
LIMITED RECONCILIATION OF GAAP AND NON-GAAP
RESULTS(In U.S. dollars in thousands,
except share and per share data)
| |
|
For the Three Months Ended June 30, |
|
|
For the Six Months Ended June 30, |
|
| |
|
2019 |
|
|
2020 |
|
|
2019 |
|
|
2020 |
|
| |
|
(Unaudited) |
|
|
(Unaudited) |
|
|
(Unaudited) |
|
|
(Unaudited) |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from operations |
|
$ |
6,560 |
|
|
$ |
8,571 |
|
|
$ |
11,004 |
|
|
$ |
11,466 |
|
| Add:
Share-based compensation |
|
|
- |
|
|
|
2,510 |
|
|
|
- |
|
|
|
2,585 |
|
| Non-GAAP
income from operations |
|
$ |
6,560 |
|
|
$ |
11,081 |
|
|
$ |
11,004 |
|
|
$ |
14,051 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net
income attributable to ordinary shareholders |
|
$ |
6,604 |
|
|
$ |
9,076 |
|
|
$ |
10,745 |
|
|
$ |
11,978 |
|
| Add:
Share-based compensation |
|
|
- |
|
|
|
2,510 |
|
|
|
- |
|
|
|
2,585 |
|
| Non-GAAP
net income attributable to ordinary shareholders |
|
$ |
6,604 |
|
|
$ |
11,586 |
|
|
$ |
10,745 |
|
|
$ |
14,563 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Weighted
average shares used in calculating earnings per ordinary
share-basic |
|
|
41,204,025 |
|
|
|
54,749,415 |
|
|
|
41,204,025 |
|
|
|
50,127,122 |
|
| Non-GAAP earnings per share |
|
$ |
0.16 |
|
|
$ |
0.21 |
|
|
$ |
0.26 |
|
|
$ |
0.29 |
|
| Weighted
average shares used in calculating earnings per ordinary
share-diluted |
|
|
46,484,025 |
|
|
|
56,074,415 |
|
|
|
46,484,025 |
|
|
|
51,452,122 |
|
| Non-GAAP diluted earnings per share |
|
$ |
0.14 |
|
|
$ |
0.21 |
|
|
$ |
0.23 |
|
|
$ |
0.28 |
|
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