BEIJING, April 3, 2014 /PRNewswire/ -- China Finance
Online Co. Limited ("China Finance Online", or the "Company", "we",
"us" or "our") (NASDAQ GS: JRJC), a technology-driven, and
user-focused market leader in China providing vertically integrated
financial information and services, today announced its unaudited
financial results for the fourth quarter and fiscal year 2013 ended
on December 31, 2013.
2013 Fourth Quarter Financial Summary
- Net revenues were $25.8 million,
representing a year-over-year increase of 400% from $5.2 million for the fourth quarter of 2012, and
a quarter-over-quarter increase of 96% from $13.2 million for the third quarter of 2013;
- Gross profit was $21.3 million,
representing a year-over-year increase of 531% from $3.4 million for the fourth quarter of 2012, and
a quarter-over-quarter increase of 88% from $11.4 million in the third quarter of 2013;
- Net income attributable to China Finance Online was
$1.6 million, compared with a net
loss of $4.9 million for the fourth
quarter of 2012 and a net loss of $1.6
million for the third quarter of 2013.
2013 Fiscal Year Financial Summary
- Net revenues were $52.1 million,
representing an increase of 76% from $29.6
million for fiscal year 2012;
- Gross profit was $41.5 million,
representing an increase of 93% from $21.5
million for fiscal year 2012;
- Net loss attributable to China Finance Online was $8.8 million.
"We are very excited that our strategic transition has finally
taken shape as we not only significantly grew our top line but also
returned to profitability in the fourth quarter. In the past three
years, we focused on improving our business fundamentals and
maintaining relationships with our online audience, while exploring
viable new business opportunities to monetize our large user base.
Now that our business model has evolved from providing financial
information to providing financial services, we look forward to
continuing to serve an increasingly large group of affluent Chinese
investors."
"We have accumulated significant experience and an invaluable
customer base through directly servicing Chinese investors for more
than ten years. Our regional offices cover all major investment
centers in China, and our sales
and marketing team is one of the most effective in the industry.
With our new business model, we are equipping our seasoned customer
specialists with new technology, tools and financial knowledge to
better serve our clients."
"Against an inflationary macro environment where the stock
market remains weak and the real estate market is
policy-influenced, investors are increasingly looking for more
diversified investment categories to help preserve and grow their
personal wealth. We strive to provide a full suite of investment
products to help clients achieve their financial goals. Through
Yinglibao, an internet-based financial platform, we provide cash
management solutions which generate higher returns than the current
one-year bank demand deposit rate, while also enabling users to
purchase mutual fund products. Our precious metal trading service
enables investors to tap into alternative investment areas. We will
continuously expand the types of investment products available to
our clients so as to perfect our one-stop solution to clients."
2013 Fourth Quarter Results
Net revenues for the fourth quarter of 2013 increased by 400%
year-over-year to $25.8 million from
$5.2 million in the fourth quarter of
2012, and up 96% quarter-over-quarter from $13.2 million in the third quarter of 2013. The
Company has re-categorized the components of its net revenues to
better reflect the evolving nature of its businesses since the
second quarter of 2013. The Company's net revenues have been
re-categorized under: (a) revenues from financial information and
advisory business, which include subscription fees from individual
customers and institutional customers; (b) revenues from financial
services, which include Hong Kong
brokerage-related revenues and our precious metal trading service;
and (c) advertising revenues. During the fourth quarter of 2013,
revenues from financial services, revenues from financial
information and advisory business and advertising revenues each
contributed 76%, 11% and 10% of the total revenues, respectively,
compared with 11%, 67% and 22%, respectively, for the fourth
quarter in 2012.
Revenues from financial services were $19.7 million compared with $0.6 million in the fourth quarter of 2012, and
up from $8.9 million in the third
quarter of 2013, mainly driven by better operating performances in
precious metal trading service. Revenues from the financial
information and advisory business were $2.9
million compared with $3.5
million in the fourth quarter of 2012, but up from
$2.8 million in the third quarter of
2013. Revenues from advertising were $2.5
million compared with $1.1
million in the fourth quarter of 2012, and up from
$1.2 million in the third quarter of
2013.
Gross profit increased by 531% year-over-year to $21.3 million from $3.4
million for the fourth quarter in 2012, and up 88% from
$11.4 million in the third quarter of
2013. Gross margin for the fourth quarter of 2013 was 82.7%
compared with 65.5% for the fourth quarter of 2012, and 86.4% in
the third quarter of 2013. The decrease in gross margin on a
sequential basis was mainly due to the increase in commission
rebates paid to the sales agents of our precious metal trading
business.
General and administrative ("G&A") expenses for the fourth
quarter of 2013 were $5.3 million, or
20.4% of net revenues, compared with $3.1
million, or 59.8% of net revenues for the fourth quarter in
2012, and $3.9 million, or 29.6% of
net revenues for the third quarter of 2013. The increase in G&A
expenses in absolute value was mainly due to higher share based
compensation expenses.
Sales and marketing expenses for the fourth quarter of 2013 were
$15.5 million, or 60.1% of net
revenues, compared with $3.2 million,
or 61.6% in the fourth quarter of 2012 and $7.4 million, or 56.4% in the third quarter of
2013. The increase in sales and marketing expenses was mainly due
to higher headcount related expenses and marketing expenses.
Product development expenses for the fourth quarter of 2013 were
$2.2 million, or 8.6% of net
revenues, compared with $2.2 million,
or 42.7% of net revenues for the fourth quarter in 2012, and
$2.4 million, or 18.1% of net
revenues in the third quarter of 2013. The Company expects to
continue to invest in its data, product and technical capabilities
to achieve the Company's long term strategic plan.
Total operating expenses for the fourth quarter of 2013 were
$23.0 million, compared with
$8.5 million in the fourth quarter of
2012, and $13.7 million in the third
quarter of 2013.
Net income attributable to China Finance Online for the fourth
quarter of 2013 was $1.6 million,
compared with a net loss of $4.9
million in the fourth quarter of 2012, and a net loss of
$1.6 million in the third quarter of
2013. During the fourth quarter of 2013, the Company sold its
investment in a real estate project at an investment gain of
$2.8 million. Basic and diluted
weighted average number of ordinary shares in the fourth quarter of
2013 were 109 million and 119 million, respectively. Each ADS
represented five ordinary shares of the Company.
2013 Fiscal Year Financial Result
Total net revenues increased by 76% year-over-year to
$52.1 million from $29.6 million in fiscal 2012. Gross profit
increased by 93% year-over-year to $41.5
million from $21.5 million in fiscal 2012. Gross
margin was 79.7% for the fiscal year of 2013. Net loss attributable
to the Company for the fiscal year of 2013 was $8.8
million.
As of December 31, 2013, total
cash and cash equivalents were $36.4
million. Accounts receivables from the non-margin related
business were $15.4 million, while
iSTAR Finance had margin-related accounts receivables of
$6.0 million. iSTAR Finance continues
to implement strict margin account screening and ongoing monitoring
to ensure the safe return of capital.
The total shareholders' equity of China Finance Online was
$75.6 million as of December 31, 2013.
Conference Call Information
The Company will host a conference call and a simultaneous
webcast on April 3, 2014 at
8:00 p.m. Eastern Time/April 4, 2014 8:00
a.m. Beijing Time. Interested parties may participate in the
conference call by dialing approximately five minutes before the
call start time at U.S. +1-877-847-0047, Hong Kong +852-3006-8101, Singapore 8008-523-396, or China 800-876-5011, and the pass code for all
regions is 705569.
A replay of the conference call will be available shortly after
the conclusion of the event through 12:00
a.m. Eastern Time on April 11,
2014 (or 12:00 p.m. Beijing
Time on April 11, 2014). The dial-in
details for the replay: U.S. +1-866-572-7808, Hong Kong +852-3012-8000, Singapore 800-101-2157, China 800-876-5013. Access code: 705569.
The conference call will be available as a live webcast and
replay at: http://www.media-server.com/m/p/7mpvivv5
About China Finance Online
China Finance Online Co. Limited is a technology-driven,
user-focused market leader in China in providing
vertically integrated financial information and services. The
Company's two prominent flagship portal
sites, www.jrj.com and www.stockstar.com, have
attracted a large population of individual investors. The Company
offers basic software, information services and securities
investment advisory services to individual investors. Through its
subsidiary, Genius, the Company provides financial database and
analytics to institutional customers including domestic financial,
research, academic and regulatory institutions. Leveraging on its
robust internet capabilities and registered user base, China
Finance Online is developing comprehensive financial services
including securities and futures brokerage services in Hong
Kong and precious metal trading services in China.
Safe Harbor Statement
This press release contains forward-looking statements. These
statements constitute "forward-looking" statements within the
meaning of Section 21E of the Securities Exchange Act of 1934, as
amended, and as defined in the U.S. 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. Among other things, this release contains the following
forward-looking statements regarding:
- our product upgrade and strategic transformation
initiative;
- our prospect on the newly launched internet-based financial
platform "Yinglibao";
- our prospect on the growth of our precious metals trading
services;
- our prospect on stabilization in cash attrition and improvement
of our financial position;
- our initiatives to address customers' demand for intuitive
online investment platforms and alternative investment
opportunities; and
- the market prospect of the business of securities investment
advisory and wealth management.
Such statements involve certain risks and uncertainties that
could cause actual results to differ materially from those in the
forward-looking statements, which risks and uncertainties include,
among others, the following:
- the changing customer needs, regulatory environment and market
condition that we are subject to;
- the uneven condition of the world and Chinese economy that
could lead to volatility in the equity markets and affect our
operating results in the coming quarters;
- the impact of the changing conditions of the Chinese stock
market, Hong Kong stock market and
global financial market on our future performance;
- the unpredictability of our strategic transformation and growth
of new businesses, including our precious metal trading
service;
- the prospect of our margin-related business and the degree to
which our implementation of margin account screening and ongoing
monitoring will yield successful outcome;
- the degree to which our strategic collaborations with partners
will yield successful outcome;
- the prospect for China's
high-net-worth and middle-class households;
- the prospect of equipping our customer specialists with new
technology, tools and financial knowledge;
- the competition we are facing in the new business of securities
investment advisory and wealth management, including cash
management solutions and mutual fund distribution, such as
Yinglibao;
- the unpredictability of our investment in the real estate
project in Langfang City of Hebei Province;
- wavering investor confidence that could impact our business;
and
- possible non-cash goodwill, intangible assets and investment
impairment may adversely affect our net income.
Further information regarding these and other risks is included
in the Company's filings with the U.S. Securities and Exchange
Commission, including its annual report on Form 20-F under
"Forward-Looking Information" and "Risk Factors". The Company does
not undertake any obligation to update any forward-looking
statement as a result of new information, future events or
otherwise, except as required under applicable law.
Contact:
Julie Zhu
China Finance Online Co. Limited
+86-10-5832-5288
ir@jrj.com
Shiwei Yin
Grayling
646-284-9474
shiwei.yin@grayling.com
Tables follow
China Finance Online
Co. Limited
|
UNAUDITED CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(In thousands of U.S.
dollars)
|
|
Dec. 31,
2013
|
Dec. 31,
2012
|
Assets
|
|
|
Current
assets:
|
|
|
Cash and cash
equivalents
|
36,371
|
40,906
|
Restricted
cash
|
4
|
28,874
|
Trust bank balances
held on behalf of customers
|
9,999
|
8,812
|
Accounts receivable,
net - Others
|
15,398
|
4,971
|
Accounts receivable,
net - Margin clients
|
5,977
|
15,054
|
Loan
receivable
|
-
|
1,206
|
Short-term
investments
|
-
|
2,640
|
Prepaid expenses and
other current assets
|
27,090
|
2,780
|
Advances to
employees
|
-
|
1,056
|
Deferred tax assets,
current
|
1,284
|
392
|
Total current
assets
|
96,123
|
106,691
|
Cost method
investment
|
1,139
|
802
|
Property and
equipment, net
|
3,868
|
4,914
|
Acquired intangible
assets, net
|
7,545
|
4,676
|
Rental
deposits
|
1,115
|
752
|
Goodwill
|
16,974
|
3,049
|
Deferred tax assets,
non-current
|
94
|
201
|
Guarantee fund
deposits
|
6,877
|
287
|
Total
assets
|
133,735
|
121,372
|
Liabilities and
equity
|
|
|
Current
liabilities:
|
|
|
Deferred revenue,
current (including
deferred revenue,
current of the consolidated
variable interest
entities without recourse
to China Finance
Online Co. Limited $3,808 and
$3,793 as of December
31,2013 and December
31,2012,
respectively)
|
6,150
|
7,551
|
Accrued expenses and
other current
liabilities
(including accrued expenses and
other current
liabilities of the consolidated
variable interest
entities without recourse
to China Finance
Online Co. Limited $7,460 and
$2,731 as of December
31,2013 and December 31,
2012,
respectively)
|
9,696
|
5,391
|
Short-term
loan(including short-term loan of
the consolidated
variable interest entities
without recourse to
China Finance Online Co.
Limited nil and nil
as of December 31,2013 and
December 31, 2012,
respectively)
|
-
|
13,546
|
Amount due to
customers for trust bank
balances held on
behalf of
customers (including
amount due to customers
for trust bank
balances held on behalf of
customers of the
consolidated variable
interest entities
without recourse to China
Finance Online Co.
Limited $648 and nil as of
December 31,2013 and
December 31, 2012,
respectively)
|
9,999
|
8,812
|
Accounts payable
(including accounts payable
of the consolidated
variable interest
entities without
recourse to China Finance
Online Co. Limited
$6,272 and $141 as of
December 31,2013 and
December 31, 2012,
respectively)
|
13,324
|
805
|
Deferred tax
liability, current (including
deferred tax
liability, current of the
consolidated variable
interest entities
without recourse to
China Finance Online Co.
Limited $325 and $140
as of December 31,2013
and December 31,
2012, respectively)
|
325
|
140
|
Income taxes payable
(including income taxes
payable of the
consolidated variable interest
entities without
recourse to China Finance
Online Co. Limited
$414 and $8 as of December
31,2013 and December
31,2012, respectively)
|
459
|
88
|
Total current
liabilities
|
39,953
|
36,333
|
Deferred tax
liability, non-current
(including deferred
tax liabilities,
non-current of the
consolidated variable
interest entities
without recourse to China
Finance Online Co.
Limited $1,886 and $1,169
as of December
31,2013 and December 31, 2012,
respectively)
|
1,886
|
1,169
|
Deferred revenue,
non-current (including
deferred revenue,
non-current of the
consolidated variable
interest entities
without recourse to
China Finance Online Co.
Limited $633 and
$1,062 as of December 31,2013
and December 31,2012,
respectively)
|
1,986
|
3,155
|
Total
liabilities
|
43,825
|
40,657
|
Noncontrolling
interests
|
14,358
|
751
|
Total China Finance
Online Co. Limited Shareholders' equity
|
75,552
|
79,964
|
Total liabilities and
equity
|
133,735
|
121,372
|
China Finance Online
Co. Limited
UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(in thousands of U.S.
dollars, except share and ADS related data)
|
|
Three months
ended
|
The year
ended
|
|
Dec.
31, 2013
|
Dec. 31,
2012
|
Sep. 30,
2013
|
Dec. 31,
2013
|
Dec. 31,
2012
|
Net
revenues
|
25,807
|
5,162
|
13,162
|
52,064
|
29,599
|
Cost of
revenues
|
(4,476)
|
(1,779)
|
(1,794)
|
(10,570)
|
(8,090)
|
Gross
profit
|
21,331
|
3,383
|
11,368
|
41,494
|
21,509
|
Operating
expenses
|
|
|
|
|
|
General and
administrative(includes
share-based
compensation expenses
of $2,120,
$196,$535,$2,985 and
$765,
respectively)
|
(5,259)
|
(3,086)
|
(3,901)
|
(15,210)
|
(11,387)
|
Sales and marketing
(includes
share-based
compensation expenses
of $6, $6, $4, $10
and $26,
respectively)
|
(15,519)
|
(3,179)
|
(7,422)
|
(30,588)
|
(13,072)
|
Product development
(includes
share-based
compensation expenses
of $22, $3, $18, $40
and $12,
respectively)
|
(2,228)
|
(2,202)
|
(2,382)
|
(9,033)
|
(10,736)
|
|
|
|
|
|
|
Total operating
expenses
|
(23,006)
|
(8,467)
|
(13,705)
|
(54,831)
|
(35,195)
|
Government
subsidies
|
-
|
2
|
11
|
11
|
75
|
Loss from
operations
|
(1,675)
|
(5,082)
|
(2,326)
|
(13,326)
|
(13,611)
|
Interest
income
|
424
|
516
|
335
|
1,341
|
3,176
|
Interest
expense
|
(1)
|
(87)
|
(135)
|
(196)
|
(517)
|
Investment gain,
net
|
2,855
|
25
|
89
|
2,906
|
434
|
Other income(loss),
net
|
337
|
(651)
|
(209)
|
(29)
|
(634)
|
Exchange gain,
net
|
148
|
248
|
85
|
557
|
73
|
|
|
|
|
|
|
Income (loss) before
income tax
(expenses)
|
2,088
|
(5,031)
|
(2,161)
|
(8,747)
|
(11,079)
|
Income tax benefits
(expenses)
|
546
|
77
|
243
|
68
|
(884)
|
|
|
|
|
|
|
Net income
(loss)
|
2,634
|
(4,954)
|
(1,918)
|
(8,679)
|
(11,963)
|
Less: Net income
(loss)
attributable to the
noncontrolling
interest
|
994
|
(88)
|
(340)
|
111
|
(104)
|
Net income (loss)
attributable to
China Finance Online
Co. Limited
|
1,640
|
(4,866)
|
(1,578)
|
(8,790)
|
(11,859)
|
|
|
|
|
|
|
Net income
(loss)
|
2,634
|
(4,954)
|
(1,918)
|
(8,679)
|
(11,963)
|
Changes in foreign
currency
translation
adjustment
|
382
|
534
|
468
|
1,193
|
131
|
Net unrealized gain
(loss) on
available-for-sale
securities, net
of tax effects of
$(4), nil, nil,
nil and $6,
respectively
|
(11)
|
-
|
-
|
-
|
32
|
Other comprehensive
income, net of
tax
|
371
|
534
|
468
|
1,193
|
163
|
Comprehensive income
(loss)
|
3,005
|
(4,420)
|
(1,450)
|
(7,486)
|
(11,800)
|
Less: comprehensive
income (loss)
attributable to
non-controlling
interest
|
994
|
(88)
|
(340)
|
111
|
(104)
|
Comprehensive income
(loss)
attributable to China
Finance
Online Co.
Limited
|
2,011
|
(4,332)
|
(1,110)
|
(7,597)
|
(11,696)
|
|
|
|
|
|
|
Net income (loss)per
share
attributable to China
Finance
Online Co.
Limited
|
|
|
|
|
|
Basic
|
0.02
|
(0.04)
|
(0.01)
|
(0.08)
|
(0.11)
|
Diluted
|
0.01
|
(0.04)
|
(0.01)
|
(0.08)
|
(0.11)
|
Net income (loss) per
ADS
attributable to China
Finance
Online Co.
Limited
|
|
|
|
|
|
Basic
|
0.08
|
(0.22)
|
(0.07)
|
(0.40)
|
(0.54)
|
Diluted
|
0.07
|
(0.22)
|
(0.07)
|
(0.40)
|
(0.54)
|
Weighted average
ordinary shares
|
|
|
|
|
|
Basic
|
109,060,617
|
108,986,666
|
109,006,101
|
109,019,513
|
108,983,249
|
Diluted
|
118,921,336
|
108,986,666
|
109,006,101
|
109,019,513
|
108,983,249
|
Weighted average
ADSs
|
|
|
|
|
|
Basic
|
21,812,123
|
21,797,333
|
21,801,220
|
21,803,903
|
21,796,650
|
Diluted
|
23,784,267
|
21,797,333
|
21,801,220
|
21,803,903
|
21,796,650
|
SOURCE China Finance Online Co. Limited