BEIJING, March 15, 2012 /PRNewswire-Asia/ -- Perfect World
Co., Ltd. (NASDAQ: PWRD) ("Perfect World" or the "Company"), a
leading online game developer and operator based in China, today announced its unaudited financial
results for the fourth quarter and fiscal year ended December 31, 2011.
(Logo: http://photos.prnewswire.com/prnh/20090416/CNTH023LOGO
)
Fourth Quarter 2011 Highlights(1)
- Total revenues were RMB776.4
million (USD123.4 million), as
compared to RMB708.9 million in 3Q11
and RMB587.2 million in 4Q10.
- Gross profit was RMB639.3 million
(USD101.6 million), as compared to
RMB587.7 million in 3Q11 and
RMB484.9 million in 4Q10.
- Operating profit was RMB220.2
million (USD35.0 million), as
compared to RMB193.9 million in 3Q11
and RMB139.2 million in 4Q10.
Non-GAAP operating profit(2) was RMB244.0
million (USD38.8 million), as
compared to RMB221.3 million in 3Q11
and RMB163.6 million in 4Q10.
- Net income attributable to the Company's shareholders was
RMB260.0 million (USD41.3 million), as compared to RMB143.6 million in 3Q11 and RMB125.2 million in 4Q10. Non-GAAP net
income attributable to the Company's shareholders(2) was
RMB283.9 million (USD45.1 million), as compared to RMB171.1 million in 3Q11 and RMB149.7 million in 4Q10.
- Basic and diluted earnings per ADS(3) were RMB5.65 (USD0.90)
and RMB5.45 (USD0.87), respectively, as compared to
RMB2.96 and RMB2.83, respectively, in 3Q11, and RMB2.50 and RMB2.36, respectively, in 4Q10. Non-GAAP
basic and diluted earnings per ADS(2) were RMB6.17 (USD0.98)
and RMB5.94 (USD0.94), respectively, as compared to
RMB3.53 and RMB3.37 respectively, in 3Q11, and RMB2.98 and RMB2.82, respectively, in 4Q10.
- Jointly established a new company in Korea with Nexon Korea
Corporation ("Nexon"), a leading global online entertainment
company, to manage and operate online games in Korea.
Fiscal Year 2011 Financial Highlights
- Total revenues were RMB2,983.4
million (USD474.0 million), as
compared to RMB2,383.6 million
in fiscal year 2010.
- Gross profit was RMB2,503.5
million (USD397.8 million), as
compared to RMB2,004.2 million in
fiscal year 2010.
- Operating profit was RMB1,023.3
million (USD162.6 million), as
compared to RMB878.4 million in
fiscal year 2010. Non-GAAP operating profit was RMB1,128.0 million (USD179.2 million), as compared to RMB975.2 million in fiscal year 2010.
- Net income attributable to the Company's shareholders was
RMB984.0 million (USD156.3 million), as compared to RMB840.7 million in fiscal year 2010.
Non-GAAP net income attributable to the Company's shareholders was
RMB1,088.7 million (USD173.0 million), as compared to RMB937.5 million in fiscal year 2010.
- Basic and diluted earnings per ADS were RMB20.18 (USD3.21)
and RMB19.27 (USD3.06), respectively, as compared to
RMB16.80 and RMB15.87, respectively, in fiscal year
2010. Non-GAAP basic and diluted earnings per ADS were
RMB22.33 (USD3.55) and RMB21.32 (USD3.39),
respectively, as compared to RMB18.73
and RMB17.70, respectively, in fiscal
year 2010.
(1) The U.S. dollar (USD) amounts disclosed in this press
release, except for those transaction amounts that were actually
settled in U.S. dollars, are presented solely for the convenience
of the reader. The conversion of Renminbi (RMB) into USD in
this release is based on the noon buying rate in The City of New York for cable transfers in RMB
per USD as certified for customs purposes by the Federal Reserve
Bank of New York as of
December 30, 2011, which was
RMB6.2939 to USD1.00. The percentages stated in this
press release are calculated based on the RMB amounts.
(2) As used in this press release, non-GAAP operating profit,
non-GAAP net income attributable to the Company's shareholders and
non-GAAP earnings per ADS are defined to exclude share-based
compensation charge from operating profit, net income attributable
to the Company's shareholders and earnings per ADS,
respectively. See "Non-GAAP Financial Measures" and
"Reconciliation of GAAP and Non-GAAP Results" at the end of this
press release.
(3) Each ADS represents five ordinary shares.
Mr. Michael Chi, Chairman and
Chief Executive Officer of Perfect World, commented, "We are
pleased to announce our solid performance in the fourth quarter of
2011. Our revenues rose by 9.5% quarter-over-quarter, which
beat the high end of our expectations, due to the strong
performance of our existing games and the continued strength of our
overseas business."
"Successfully maintaining user interest in our existing games is
one of the key drivers of our growth. In the fourth quarter,
we continued to release a steady stream of expansion packs and
content updates to keep our players engaged and to meet their
changing and increasingly demanding needs. We also continued
to expand our diversified portfolio of games. Our deep and
well-rounded pipeline includes a number of attractive titles of
different genres and types, ranging from MMORPGs to web games and
social networking games. Recently, we unveiled another
forthcoming title, 'Fantasy Condor Heroes.' This is a
cartoon-style martial arts MMORPG adapted from the highly acclaimed
Chinese novel, 'Return of the Condor Heroes,' by Louis Cha. In addition to our highly
anticipated 'Swordsman Online' and 'Saint Seiya Online,' we believe
'Fantasy Condor Heroes' will also capture the attention of many
players."
"Another key driver of our continuous growth is our effective
globalization strategy. We maintain a number of specialized
production studios in China and
worldwide that support our well-established R&D capabilities
and continue to buttress our industry leading position. Our
subsidiaries based in the U.S. are developing several world-class
titles, including 'Neverwinter' by Cryptic Studios, Inc. ('Cryptic
Studios'). We are also actively expanding our deep global
operating network. During the fourth quarter, we partnered
with Nexon and jointly established a new company in Korea to manage
and operate online games in Korea. We expect this to further
enhance our global operational capabilities and allow us to provide
enhanced services to our users in the Korean market. Looking
ahead, we will continue to leverage our overseas resources and the
appeal of our brand world-wide to further strengthen our position
in the global gaming market."
"In order to further enhance our execution capabilities, I am
pleased to announce that the Company has appointed Mr. Robert Hong Xiao, our senior vice president, as
Chief Operating Officer. Mr. Xiao joined Perfect World as a
senior vice president in charge of our human resources and
administration in 2008. We are grateful for his significant
contributions to our global business operations and strategic
development over the past few years. In his new role, he will
oversee our business operations and business support functions to
help execute our business strategies more efficiently and
effectively. Given the continued, successful execution of our
strategy and unwavering focus on our commitments, we are confident
in our ability to continue generating value for our shareholders
over the long-term."
Mr. Kelvin Lau, Chief Financial
Officer, added, "Our fourth quarter revenues surpassed the high-end
of our expectations and our bottom line also achieved strong
sequential growth, mainly due to the continued strength of our
existing games, including our popular flagship title 'Zhu
Xian.'"
"In addition to the strong performance of our existing games in
the domestic market, we continued to excel in our overseas
business. We generate over one-fourth of our total revenues
from operating and licensing our games abroad and maintain a
geographical coverage of over 100 countries and regions worldwide,
making us the number one Chinese online gaming company in the
overseas market. Recently, we launched 'Empire of the
Immortals' in Japan through our
wholly-owned Japanese subsidiary, and also in North America and Europe under the name of 'War of the
Immortals' through our wholly-owned U.S. and European subsidiaries.
We also published 'Blacklight Retribution,' a free-to-play
first-person shooter game developed by the well-known U.S.-based
Zombie Studios, Inc., in North America. Furthermore, we
achieved continued growth from our overseas licensing activities
during the fourth quarter as we successfully launched a number of
our games in various markets abroad through our overseas
partners."
"Looking back at the full year of 2011, both our top line and
bottom line grew steadily from 2010 despite some natural quarterly
fluctuations. For the full year of 2011, our revenues grew by
a solid 25.2%. This is a clear indication of the underlying
health of our business in spite of an increasingly competitive
environment. As we continuously generate strong free cash
flow from our healthy operations, the Company would like to return
value to our shareholders in appreciation of their long-standing
trust and support. On March 14,
2012, the board of directors declared special cash dividends
in the aggregate amount of approximately USD95 million to our shareholders of record as of
the close of business on April 6, 2012
(Eastern Time), at USD0.40 per
Class A or Class B ordinary share, or USD2.00 per ADS, each representing five Class B
ordinary shares of the Company. The dividends are expected to
be distributed in cash in or around April 2012. We intend to
distribute dividends annually in the future. However, the
distribution of any future dividends will be at the full discretion
of the Board and will be dependent upon our financial position,
results of operations, available cash, capital requirements and
other factors. Bringing value to our shareholders is an
important part of our commitment, and we will continue to do what
is necessary for the long-term health of our business and the best
interest of our shareholders."
Fourth Quarter 2011 Financial Results
Total Revenues
Total revenues were RMB776.4
million (USD123.4 million) in
4Q11, as compared to RMB708.9 million
in 3Q11 and RMB587.2 million in
4Q10.
Online game operation revenues, which include both domestic and
overseas online game operations, were RMB706.9 million (USD112.3
million) in 4Q11, as compared to RMB643.2 million in 3Q11 and RMB526.2 million in 4Q10. The sequential
growth in online game operation revenues from 3Q11 was primarily
attributable to the continued strength of some of the Company's
existing games including the Company's signature title "Zhu Xian,"
as well as the continued strength of the Company's overseas
operations.
The aggregate average concurrent users (ACU) for games under
operation in mainland China was
approximately 873,000 in 4Q11, as compared to 828,000 in 3Q11 and
999,000 in 4Q10.
Licensing revenues were RMB65.6
million (USD10.4 million) in
4Q11, as compared to RMB55.8 million
in 3Q11 and RMB57.8 million in
4Q10. The increase from 3Q11 was primarily attributable to an
increase in initial license fees arising from a number of new
commercial launches overseas.
Other revenues were RMB3.9 million
(USD0.6 million) in 4Q11, as compared
to RMB9.9 million in 3Q11 and
RMB3.2 million in 4Q10.
Cost of Revenues
The cost of revenues was RMB137.1
million (USD21.8 million) in
4Q11, as compared to RMB121.2 million
in 3Q11 and RMB102.4 million in 4Q10.
The increase from 3Q11 was mainly due to an increase in staff
cost including a special year-end bonus, sales-related taxes and
server depreciation expenses in 4Q11.
Gross Profit and Gross Margin
Gross profit was RMB639.3 million
(USD101.6 million) in 4Q11, as
compared to RMB587.7 million in 3Q11
and RMB484.9 million in 4Q10.
Gross margin was 82.3% in 4Q11, as compared to 82.9% in 3Q11 and
82.6% in 4Q10.
Operating Expenses
Operating expenses were RMB419.1
million (USD66.6 million) in
4Q11, as compared to RMB393.9 million
in 3Q11 and RMB345.7 million in 4Q10.
The increase in operating expenses from 3Q11 was mainly
attributed to higher R&D expenses and general administrative
expenses in 4Q11.
R&D expenses were RMB186.5
million (USD29.6 million) in
4Q11, as compared to RMB170.6 million
in 3Q11 and RMB136.8 million in 4Q10.
The increase from 3Q11 was primarily due to an increase in
staff cost.
Sales and marketing expenses were RMB142.0 million (USD22.6
million) in 4Q11, as compared to RMB146.7 million in 3Q11 and RMB153.5 million in 4Q10. As the Company
did not launch any new game in 4Q11, sales and marketing expenses
remained relatively flat.
General and administrative expenses were RMB90.6 million (USD14.4
million) in 4Q11, as compared to RMB76.5 million in 3Q11 and RMB55.4 million in 4Q10. The increase from
3Q11 was mainly due to an increase in staff cost, including a
special year-end bonus.
Operating Profit
Operating profit was RMB220.2
million (USD35.0 million) in
4Q11, as compared to RMB193.9 million
in 3Q11 and RMB139.2 million in
4Q10. Non-GAAP operating profit was RMB244.0 million (USD38.8
million) in 4Q11, as compared to RMB221.3 million in 3Q11 and RMB163.6 million in 4Q10.
Total Other Income
Total other income was RMB49.0
million (USD7.8 million) in
4Q11, as compared to RMB28.5 million
in 3Q11 and RMB14.1 million in
4Q10. The increase from 3Q11 was largely due to an increase
in government grant subsidy income.
Income Tax Expense
Income tax expense was RMB10.7
million (USD1.7 million) in
4Q11, as compared to RMB78.8 million
in 3Q11 and RMB13.1 million in 4Q10.
The decrease from 3Q11 was mainly due to lower withholding
tax in 4Q11. An additional withholding tax was accrued in
3Q11 for prior-period undistributed earnings as a result of the
change in the Company's dividend policy to reflect the Company's
intention to distribute part of the earnings of the Company's
wholly-owned PRC subsidiaries to its shareholders from time to
time. In 4Q11, such tax expense was accrued for undistributed
earnings of current period.
Net Income Attributable to the Company's
Shareholders
Net income attributable to the Company's shareholders was
RMB260.0 million (USD41.3 million) in 4Q11, as compared to
RMB143.6 million in 3Q11 and
RMB125.2 million in 4Q10.
Non-GAAP net income attributable to the Company's shareholders was
RMB283.9 million (USD45.1 million) in 4Q11, as compared to
RMB171.1 million in 3Q11 and
RMB149.7 million in 4Q10.
Basic and diluted earnings per ADS were RMB5.65 (USD0.90)
and RMB5.45 (USD0.87), respectively, in 4Q11, as compared to
RMB2.96 and RMB2.83, respectively, in 3Q11, and RMB2.50 and RMB2.36, respectively, in 4Q10. Non-GAAP
basic and diluted earnings per ADS were RMB6.17 (USD0.98)
and RMB5.94 (USD0.94), respectively, in 4Q11, as compared to
RMB3.53 and RMB3.37, respectively, in 3Q11, and RMB2.98 and RMB2.82, respectively, in 4Q10.
Cash and Cash Equivalents
As of December 31, 2011, the
Company had RMB2.2 billion
(USD341.6 million) of cash and cash
equivalents, as compared to RMB1.6
billion as of September 30,
2011. The increase was primarily due to net cash
inflow generated from the Company's online game operations, as well
as cash inflow from some matured short-term structured
deposits.
Fiscal Year 2011 Financial Results
Total Revenues
Total revenues were RMB2,983.4
million (USD474.0 million) in
fiscal year 2011, as compared to RMB2,383.6
million in fiscal year 2010.
Online game operation revenues, which include both domestic and
overseas online game operations, were RMB2,708.5 million (USD430.3 million) in fiscal year 2011, as
compared to RMB2,156.3 million in
fiscal year 2010. The year-over-year increase was primarily
attributable to the contribution from the Company's recently
launched new games such as "Forsaken World," the continued
popularity of some of the Company's core existing games including
"Zhu Xian" and "Perfect World II" in the domestic market, as well
as the successful expansion of the Company's overseas operations in
North America, Europe and Japan.
Licensing revenues were RMB246.8
million (USD39.2 million) in
fiscal year 2011, as compared to RMB215.0
million in fiscal year 2010. The year-over-year
increase was primarily attributable to the continued growth from
the Company's overseas licensing activities in various overseas
markets as it continued to strengthen its global penetration during
fiscal year 2011.
Other revenues were RMB28.1
million (USD4.5 million) in
fiscal year 2011, as compared to RMB12.4
million in fiscal year 2010. The year-over-year
increase was primarily due to an increase in revenues generated
from the Company's non-online games and lighter games during fiscal
year 2011.
Cost of Revenues
Cost of revenues was RMB479.9
million (USD76.3 million) in
fiscal year 2011, as compared to RMB379.4
million in fiscal year 2010. The year-over-year
increase was primarily due to increases in staff cost,
sales-related taxes and server depreciation expenses associated
with the Company's expansion of its domestic game operations and
its overseas acquisitions. This increase was generally in
line with the Company's revenue growth.
Gross Profit and Gross Margin
Gross profit was RMB2,503.5
million (USD397.8 million) in
fiscal year 2011, as compared to RMB2,004.2
million in fiscal year 2010. Gross margin was 83.9% in
fiscal year 2011, as compared to 84.1% in fiscal year
2010.
Operating Expenses
Operating expenses were RMB1,480.2
million (USD235.2 million) in
fiscal year 2011, as compared to RMB1,125.8
million in fiscal year 2010. The year-over-year
increase in operating expenses was mainly due to the expansion of
the Company's overall business operations and talent pool, as well
as its overseas acquisitions.
Operating Profit
Operating profit was RMB1,023.3
million (USD162.6 million) in
fiscal year 2011, as compared to RMB878.4
million in fiscal year 2010. Non-GAAP operating profit
was RMB1,128.0 million (USD179.2 million) in fiscal year 2011, as
compared to RMB975.2 million in
fiscal year 2010.
Net Income Attributable to the Company's
Shareholders
Net income attributable to the Company's shareholders was
RMB984.0 million (USD156.3 million) in fiscal year 2011, as
compared to RMB840.7 million in
fiscal year 2010. Non-GAAP net income attributable to the
Company's shareholders was RMB1,088.7
million (USD173.0 million) in
fiscal year 2011, as compared to RMB937.5
million in fiscal year 2010.
Basic and diluted earnings per ADS were RMB20.18 (USD3.21)
and RMB19.27 (USD3.06), respectively, in fiscal year 2011, as
compared to RMB16.80 and RMB15.87, respectively, in fiscal year
2010. Non-GAAP basic and diluted earnings per ADS were
RMB22.33 (USD3.55) and RMB21.32 (USD3.39),
respectively, in fiscal year 2011, as compared to RMB18.73 and RMB17.70, respectively, in fiscal year 2010.
Recent Development
Appointed the Company's Senior Vice President
Mr. Robert Hong
Xiao as Chief Operating Officer
The Company has appointed Mr. Robert
Hong Xiao, the Company's senior vice president, as Chief
Operating Officer. Mr. Xiao joined Perfect World as a senior
vice president in charge of its human resources and administration
in 2008. With his strong execution capabilities and thorough
understanding of Perfect World's business and corporate
culture,combined with his rich past experiences at various
world-class multinational corporations, Mr. Xiao will oversee the
Company's business operations and business support functions in his
new role to further enhance the Company's execution
capabilities.
Declaration of Cash Dividends
As the Company continues to generate strong free cash flow from
its healthy operations, the Company would like to return value to
its shareholders in appreciation of their long-standing trust and
support. On March 14, 2012, the
Company's board of directors declared special cash dividends in the
aggregate amount of approximately USD95
million to the Company's shareholders of record as of the
close of business on April 6, 2012 (Eastern
Time), at USD0.40 per Class A
or Class B ordinary share, or USD2.00
per ADS, each representing five Class B ordinary shares of the
Company. The dividends are expected to be distributed in cash
in or around April 2012.
The Company intends to distribute dividends annually in the
future. However, the distribution of any future dividends
will be at the full discretion of the Board and will be dependent
upon the Company's financial position, results of operations,
available cash, capital requirements and other
factors.
Business Outlook
Based on the Company's current operations, total revenues for
the first quarter of 2012 are expected to be between RMB714 million and RMB753 million, representing a
mild decline on a sequential basis. Quarterly fluctuation is
a natural part of the Company's normal product cycle. Some of
the in-game promotional activities toward the end of the first
quarter are expected to take shape some time after the end of
quarter.
Non-GAAP Financial Measures
To supplement the financial measures prepared in accordance with
generally accepted accounting principals in the United States, or GAAP, this press release
presents non-GAAP operating profit, non-GAAP net income
attributable to the Company's shareholders and non-GAAP earnings
per ADS by excluding share-based compensation charge from operating
profit, net income attributable to the Company's shareholders and
earnings per ADS, respectively. The Company believes these
non-GAAP financial measures are important to help investors
understand the Company's operating and financial performance,
compare business trends among different reporting periods on a
consistent basis and assess the Company's core operating results,
as they exclude certain expenses that are not expected to result in
cash payments. The use of the above non-GAAP financial
measures has certain limitations. Share-based compensation
charge has been and will continue to be incurred and is not
reflected in the presentation of the non-GAAP financial measures.
It should be considered in the overall evaluation of our
results. None of the non-GAAP measures is a measure of net
income attributable to the Company's shareholders, operating
profit, operating performance or liquidity presented in accordance
with GAAP. We compensate for these limitations by providing
the relevant disclosure of our share-based compensation charge in
our reconciliations to the most directly comparable GAAP financial
measures, which should be considered when evaluating our
performance. These non-GAAP financial measures should be
considered in addition to financial measures prepared in accordance
with GAAP, but should not be considered a substitute for, or
superior to, financial measures prepared in accordance with GAAP.
Reconciliation of each of these non-GAAP financial measures
to the most directly comparable GAAP financial measure are set
forth at the end of this release.
Conference Call
Perfect World will host a conference call and live webcast at
9:00pm Eastern Daylight Time on
Thursday, March 15, 2012
(9:00am Beijing time on Friday,
March 16, 2012).
Dial-in numbers for the live conference call are as follows:
- U.S. Toll Free
Number
|
1-866-519-4004
|
- International Dial-in
Number
|
+65-6723-9381
|
- Mainland China Toll
Free Number
|
800-819-0121
|
- Hong Kong Toll Free
Number
|
80-093-0346
|
- U.K. Toll Free
Number
|
080-8234-6646
|
Conference ID:
|
PWRD
|
A live and archived webcast of the conference call will be
available on the Investor Relations section of Perfect World's
website at http://www.pwrd.com.
A telephone replay of the call will be available beginning two
hours after the conclusion of the conference call through
11:59pm Eastern Time, March 23, 2012.
Dial-in numbers for the replay are as follows:
- U.S. Toll Free
Number
|
1-866-214-5335
|
- International Dial-in
Number
|
+61-2-8235-5000
|
Conference ID:
|
49594884
|
About Perfect World Co., Ltd.
(http://www.pwrd.com)
Perfect World Co., Ltd. (NASDAQ: PWRD) is a leading online game
developer and operator based in China. Perfect World primarily develops
online games based on proprietary game engines and game development
platforms. Perfect World's strong technology and creative
game design capabilities, combined with extensive knowledge and
experiences in the online game market, enable it to frequently and
promptly introduce popular games designed to cater changing
customer preferences and market trends. Perfect World's current
portfolio of self-developed online games includes massively
multiplayer online role playing games ("MMORPGs"): "Perfect World,"
"Legend of Martial Arts," "Perfect
World II," "Zhu Xian," "Chi Bi,"
"Pocketpet Journey West," "Battle of the Immortals," "Fantasy Zhu
Xian," "Forsaken World," "Dragon Excalibur," "Empire of the
Immortals" and "Heaven Sword and
Dragon Saber;" an online casual game: "Hot Dance Party;" and a
number of web games and social networking games. While a
substantial portion of the revenues are generated in China, Perfect World operates its games in
North America, Europe and Japan through its own subsidiaries.
Perfect World's games have also been licensed to leading game
operators in a number of countries and regions in Asia, Latin
America, Australia,
New Zealand, and the Russian Federation and other Russian speaking
territories. Perfect World plans to continue to explore new
and innovative business models and remains deeply committed to
maximizing shareholder value over time.
Safe Harbor Statements
This press release contains forward-looking statements.
These statements constitute forward-looking statements under 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, the management's quotations and "Business Outlook" contain
forward-looking statements. Such statements involve certain
risks and uncertainties that could cause actual results to differ
materially from those in the forward-looking statements.
Potential risks and uncertainties include, but are not limited to,
Perfect World's limited operating history, its ability to develop
and operate new games that are commercially successful, the growth
of the online game market and the continuing market acceptance of
its games and in-game items in China and elsewhere, its ability to protect
intellectual property rights, its ability to respond to competitive
pressure, its ability to maintain an effective system of internal
control over financial reporting, changes of the regulatory
environment in China, and economic
slowdown in China and/or
elsewhere. Further information regarding these and other
risks is included in Perfect World's filings with the U.S.
Securities and Exchange Commission, including its annual report on
Form 20-F. All information provided in this press release and
in the attachments is as of March 15,
2012, and Perfect World 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.
For further information, please contact
Perfect World Co., Ltd.
Vivien Wang --Vice President,
Investor Relations & Corporate Communications
Joanne Deng -- Investor Relations
Manager
Tel: +86-10-5780-5700
Fax: +86-10-5780-5713
Email: ir@pwrd.com
http://www.pwrd.com
Christensen Investor Relations
Patty Bruner
Tel: +1-480-614-3036
Fax: +1-480-614-3033
Email: pbruner@christensenir.com
Teal Willingham
Tel: +86-10-5826-4988
Fax: +86-10-5826-4838
Email: twillingham@christensenir.com
Perfect
World Co., Ltd.
Unaudited Consolidated Balance
Sheets
|
|
December
31,
|
|
December
31,
|
|
December
31,
|
|
2010
|
|
2011
|
|
2011
|
|
RMB
|
|
RMB
|
|
USD
|
Assets
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
Cash and cash
equivalents
|
1,387,621,178
|
|
2,150,213,495
|
|
341,634,518
|
Restricted cash
|
4,849,614
|
|
535,500,431
|
|
85,082,450
|
Short-term
investments
|
390,000,000
|
|
139,517,875
|
|
22,167,158
|
Accounts receivable,
net
|
157,617,474
|
|
142,543,972
|
|
22,647,956
|
Due from related
parties
|
2,127,500
|
|
40,000
|
|
6,355
|
Prepayment and other
assets
|
83,369,296
|
|
94,628,466
|
|
15,034,949
|
Deferred tax assets
|
9,399,978
|
|
27,130,068
|
|
4,310,534
|
Total current
assets
|
2,034,985,040
|
|
3,089,574,307
|
|
490,883,920
|
Non current
assets
|
|
|
|
|
|
Equity investments
|
49,378,909
|
|
33,384,729
|
|
5,304,299
|
Time deposits
|
284,568,575
|
|
293,892,575
|
|
46,694,828
|
Restricted time
deposit
|
121,721,425
|
|
125,717,425
|
|
19,974,487
|
Film and television
cost
|
24,240,561
|
|
-
|
|
-
|
Property, equipment, and
software, net
|
306,248,969
|
|
1,259,850,498
|
|
200,170,085
|
Construction in
progress
|
911,395,229
|
|
4,793,214
|
|
761,565
|
Intangible assets,
net
|
138,464,771
|
|
273,193,489
|
|
43,406,074
|
Goodwill
|
483,624,832
|
|
466,328,513
|
|
74,092,139
|
Due from related
parties
|
-
|
|
7,561,080
|
|
1,201,335
|
Prepayments and other
assets
|
48,010,649
|
|
62,457,484
|
|
9,923,495
|
Deferred tax assets
|
2,690,344
|
|
35,235,313
|
|
5,598,327
|
Total
assets
|
4,405,329,304
|
|
5,651,988,627
|
|
898,010,554
|
|
|
|
|
|
|
Liabilities and
Shareholders' Equity
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
Accounts payable
|
121,600,949
|
|
89,123,596
|
|
14,160,312
|
Short-term bank
loans
|
-
|
|
560,780,100
|
|
89,098,985
|
Advances from
customers
|
146,203,059
|
|
95,921,079
|
|
15,240,325
|
Salary and welfare
payable
|
154,136,724
|
|
204,976,567
|
|
32,567,497
|
Taxes payable
|
27,455,310
|
|
43,236,335
|
|
6,869,562
|
Accrued expenses and other
liabilities
|
131,580,683
|
|
68,663,124
|
|
10,909,472
|
Due to related
parties
|
4,832,000
|
|
155,000
|
|
24,627
|
Deferred revenues
|
386,274,965
|
|
461,921,174
|
|
73,391,883
|
Deferred tax
liabilities
|
47,037,398
|
|
106,933,061
|
|
16,989,952
|
Deferred government
grants
|
300,000
|
|
579,526
|
|
92,077
|
Total current
liabilities
|
1,019,421,088
|
|
1,632,289,562
|
|
259,344,692
|
Deferred revenues
|
26,320,224
|
|
17,481,338
|
|
2,777,505
|
Deferred tax liabilities
|
-
|
|
8,005,954
|
|
1,272,018
|
Other long-term liabilities
|
-
|
|
8,803,103
|
|
1,398,672
|
Total
liabilities
|
1,045,741,312
|
|
1,666,579,957
|
|
264,792,887
|
|
|
|
|
|
|
Shareholders'
Equity
|
|
|
|
|
|
Ordinary shares (US$0.0001 par
value, 10,000,000,000
shares authorized,
39,171,195 Class A ordinary shares
issued and outstanding,
211,839,885 Class B ordinary
shares issued and
outstanding as of December 31, 2010;
10,000,000,000 shares
authorized, 29,671,195 Class A
ordinary shares issued
and outstanding, 201,238,020
Class B ordinary shares
issued and outstanding as of
December 31,
2011)
|
199,791
|
|
186,948
|
|
29,703
|
Additional paid-in
capital
|
493,089,324
|
|
212,421,037
|
|
33,750,304
|
Statutory reserves
|
239,264,390
|
|
268,014,793
|
|
42,583,262
|
Accumulated other
comprehensive loss
|
(65,956,622)
|
|
(60,430,695)
|
|
(9,601,470)
|
Retained earnings
|
2,582,851,059
|
|
3,538,087,071
|
|
562,145,422
|
Total Perfect World
Shareholders' Equity
|
3,249,447,942
|
|
3,958,279,154
|
|
628,907,221
|
Non-controlling
interests
|
110,140,050
|
|
27,129,516
|
|
4,310,446
|
Total Shareholders'
Equity
|
3,359,587,992
|
|
3,985,408,670
|
|
633,217,667
|
Total Liabilities and
Shareholders' Equity
|
4,405,329,304
|
|
5,651,988,627
|
|
898,010,554
|
Perfect World Co.,
Ltd.
Unaudited Consolidated
Statements of Operations
|
|
Three months
ended
|
|
Year
ended
|
|
December 31,
|
|
September 30,
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
2010
|
|
2011
|
|
2011
|
|
2011
|
|
2010
|
|
2011
|
|
2011
|
|
RMB
|
|
RMB
|
|
RMB
|
|
USD
|
|
RMB
|
|
RMB
|
|
USD
|
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Online game operation
revenues
|
526,194,312
|
|
643,240,306
|
|
706,928,792
|
|
112,319,673
|
|
2,156,258,192
|
|
2,708,506,602
|
|
430,338,360
|
Licensing revenues
|
57,824,612
|
|
55,801,551
|
|
65,602,278
|
|
10,423,152
|
|
214,980,802
|
|
246,823,270
|
|
39,216,268
|
Other revenues
|
3,203,519
|
|
9,901,854
|
|
3,856,156
|
|
612,681
|
|
12,401,545
|
|
28,106,785
|
|
4,465,718
|
Total
Revenues
|
587,222,443
|
|
708,943,711
|
|
776,387,226
|
|
123,355,506
|
|
2,383,640,539
|
|
2,983,436,657
|
|
474,020,346
|
Cost of
revenues
|
(102,359,010)
|
|
(121,227,110)
|
|
(137,087,329)
|
|
(21,780,983)
|
|
(379,416,458)
|
|
(479,929,333)
|
|
(76,253,092)
|
Gross
profit
|
484,863,433
|
|
587,716,601
|
|
639,299,897
|
|
101,574,523
|
|
2,004,224,081
|
|
2,503,507,324
|
|
397,767,254
|
Operating
expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development
expenses
|
(136,790,553)
|
|
(170,640,162)
|
|
(186,483,272)
|
|
(29,629,208)
|
|
(419,076,642)
|
|
(664,354,758)
|
|
(105,555,341)
|
Sales and marketing
expenses
|
(153,468,835)
|
|
(146,746,286)
|
|
(142,022,371)
|
|
(22,565,082)
|
|
(477,785,759)
|
|
(513,914,847)
|
|
(81,652,846)
|
General and administrative
expenses
|
(55,410,090)
|
|
(76,475,913)
|
|
(90,617,974)
|
|
(14,397,746)
|
|
(228,967,096)
|
|
(301,951,176)
|
|
(47,975,210)
|
Total operating
expenses
|
(345,669,478)
|
|
(393,862,361)
|
|
(419,123,617)
|
|
(66,592,036)
|
|
(1,125,829,497)
|
|
(1,480,220,781)
|
|
(235,183,397)
|
Operating
profit
|
139,193,955
|
|
193,854,240
|
|
220,176,280
|
|
34,982,487
|
|
878,394,584
|
|
1,023,286,543
|
|
162,583,857
|
Other income /
(expenses)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share of loss from equity
investments
|
(2,107,573)
|
|
(485,958)
|
|
(341,956)
|
|
(54,331)
|
|
(8,092,328)
|
|
(1,574,506)
|
|
(250,164)
|
Interest income
|
9,472,442
|
|
21,618,355
|
|
23,418,520
|
|
3,720,828
|
|
28,650,469
|
|
72,527,888
|
|
11,523,521
|
Interest expense
|
-
|
|
(2,277,145)
|
|
(4,329,191)
|
|
(687,839)
|
|
-
|
|
(6,606,336)
|
|
(1,049,641)
|
Others, net
|
6,707,706
|
|
9,624,146
|
|
30,228,833
|
|
4,802,878
|
|
15,181,510
|
|
54,171,038
|
|
8,606,911
|
Total other
income
|
14,072,575
|
|
28,479,398
|
|
48,976,206
|
|
7,781,536
|
|
35,739,651
|
|
118,518,084
|
|
18,830,627
|
Profit before
tax
|
153,266,530
|
|
222,333,638
|
|
269,152,486
|
|
42,764,023
|
|
914,134,235
|
|
1,141,804,627
|
|
181,414,484
|
Income tax expense
|
(13,146,528)
|
|
(78,769,353)
|
|
(10,657,559)
|
|
(1,693,316)
|
|
(88,996,332)
|
|
(161,704,455)
|
|
(25,692,250)
|
Income from
continuing operations, net of tax
|
140,120,002
|
|
143,564,285
|
|
258,494,927
|
|
41,070,707
|
|
825,137,903
|
|
980,100,172
|
|
155,722,234
|
(Loss) / income from
discontinued operations, net of tax
|
(16,728,545)
|
|
(1,400,275)
|
|
-
|
|
-
|
|
1,424,764
|
|
(37,492)
|
|
(5,957)
|
Net
Income
|
123,391,457
|
|
142,164,010
|
|
258,494,927
|
|
41,070,707
|
|
826,562,667
|
|
980,062,680
|
|
155,716,277
|
Net loss attributable to
the non-controlling interests
|
1,817,047
|
|
1,453,584
|
|
1,526,359
|
|
242,514
|
|
14,138,106
|
|
3,923,735
|
|
623,419
|
Net income
attributable to the Company's shareholders
|
125,208,504
|
|
143,617,594
|
|
260,021,286
|
|
41,313,221
|
|
840,700,773
|
|
983,986,415
|
|
156,339,696
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings per share,
basic
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing
operations
|
0.57
|
|
0.60
|
|
1.13
|
|
0.18
|
|
3.31
|
|
4.04
|
|
0.64
|
Discontinued
operations
|
(0.07)
|
|
(0.01)
|
|
0.00
|
|
0.00
|
|
0.05
|
|
0.00
|
|
0.00
|
Total earnings per
share, basic
|
0.50
|
|
0.59
|
|
1.13
|
|
0.18
|
|
3.36
|
|
4.04
|
|
0.64
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings per share,
diluted
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing
operations
|
0.53
|
|
0.58
|
|
1.09
|
|
0.17
|
|
3.12
|
|
3.85
|
|
0.61
|
Discontinued
operations
|
(0.06)
|
|
(0.01)
|
|
0.00
|
|
0.00
|
|
0.05
|
|
0.00
|
|
0.00
|
Total earnings per
share, diluted
|
0.47
|
|
0.57
|
|
1.09
|
|
0.17
|
|
3.17
|
|
3.85
|
|
0.61
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings per ADS,
basic
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing
operations
|
2.83
|
|
2.99
|
|
5.65
|
|
0.90
|
|
16.54
|
|
20.17
|
|
3.21
|
Discontinued
operations
|
(0.33)
|
|
(0.03)
|
|
0.00
|
|
0.00
|
|
0.26
|
|
0.01
|
|
0.00
|
Total earnings per
share, basic
|
2.50
|
|
2.96
|
|
5.65
|
|
0.90
|
|
16.80
|
|
20.18
|
|
3.21
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings per ADS,
diluted
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing
operations
|
2.67
|
|
2.86
|
|
5.45
|
|
0.87
|
|
15.63
|
|
19.26
|
|
3.06
|
Discontinued
operations
|
(0.31)
|
|
(0.03)
|
|
0.00
|
|
0.00
|
|
0.24
|
|
0.01
|
|
0.00
|
Total earnings per
share, diluted
|
2.36
|
|
2.83
|
|
5.45
|
|
0.87
|
|
15.87
|
|
19.27
|
|
3.06
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares used in
calculating basic net earnings per share
|
250,754,716
|
|
242,659,663
|
|
230,210,827
|
|
230,210,827
|
|
250,232,543
|
|
243,765,093
|
|
243,765,093
|
Shares used in
calculating diluted net earnings per share
|
264,919,670
|
|
253,972,573
|
|
238,748,799
|
|
238,748,799
|
|
264,818,376
|
|
255,380,327
|
|
255,380,327
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amount attributable to
the Company's shareholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing
operations, net of tax
|
141,786,339
|
|
144,967,632
|
|
260,021,286
|
|
41,313,221
|
|
827,869,318
|
|
983,672,251
|
|
156,289,780
|
(Loss) / income from
discontinued operations, net of tax
|
(16,577,835)
|
|
(1,350,038)
|
|
-
|
|
-
|
|
12,831,455
|
|
314,164
|
|
49,916
|
Net income
|
125,208,504
|
|
143,617,594
|
|
260,021,286
|
|
41,313,221
|
|
840,700,773
|
|
983,986,415
|
|
156,339,696
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total share-based
compensation cost included in:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenues
|
(1,732,264)
|
|
(1,646,149)
|
|
(1,508,310)
|
|
(239,646)
|
|
(6,938,253)
|
|
(6,362,169)
|
|
(1,010,847)
|
Research and development
expenses
|
(9,371,368)
|
|
(12,576,220)
|
|
(11,607,745)
|
|
(1,844,285)
|
|
(37,480,733)
|
|
(47,533,344)
|
|
(7,552,288)
|
Sales and marketing
expenses
|
(3,437,163)
|
|
(3,935,862)
|
|
(3,628,054)
|
|
(576,440)
|
|
(13,079,432)
|
|
(15,228,350)
|
|
(2,419,541)
|
General and administrative
expenses
|
(9,903,017)
|
|
(9,306,125)
|
|
(7,101,620)
|
|
(1,128,334)
|
|
(39,286,985)
|
|
(35,612,664)
|
|
(5,658,282)
|
Perfect
World Co., Ltd.
Reconciliation of GAAP and
Non-GAAP Results
|
|
Three months
ended
|
|
Year
ended
|
|
December 31,
|
|
September 30,
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
2010
|
|
2011
|
|
2011
|
|
2011
|
|
2010
|
|
2011
|
|
2011
|
|
RMB
|
|
RMB
|
|
RMB
|
|
USD
|
|
RMB
|
|
RMB
|
|
USD
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP operating
profit
|
139,193,955
|
|
193,854,240
|
|
220,176,280
|
|
34,982,487
|
|
878,394,584
|
|
1,023,286,543
|
|
162,583,857
|
Share based compensation
charge
|
24,443,812
|
|
27,464,356
|
|
23,845,729
|
|
3,788,705
|
|
96,785,403
|
|
104,736,527
|
|
16,640,958
|
Non-GAAP operating
profit
|
163,637,767
|
|
221,318,596
|
|
244,022,009
|
|
38,771,192
|
|
975,179,987
|
|
1,128,023,070
|
|
179,224,815
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income
attributable to the Company's shareholders
|
125,208,504
|
|
143,617,594
|
|
260,021,286
|
|
41,313,221
|
|
840,700,773
|
|
983,986,415
|
|
156,339,696
|
Share based compensation
charge
|
24,443,812
|
|
27,464,356
|
|
23,845,729
|
|
3,788,705
|
|
96,785,403
|
|
104,736,527
|
|
16,640,958
|
Non-GAAP net income
attributable to the Company's shareholders
|
149,652,316
|
|
171,081,950
|
|
283,867,015
|
|
45,101,926
|
|
937,486,176
|
|
1,088,722,942
|
|
172,980,654
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net earnings per
ADS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
Basic
|
2.50
|
|
2.96
|
|
5.65
|
|
0.90
|
|
16.80
|
|
20.18
|
|
3.21
|
-
Diluted
|
2.36
|
|
2.83
|
|
5.45
|
|
0.87
|
|
15.87
|
|
19.27
|
|
3.06
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP net earnings
per ADS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
Basic
|
2.98
|
|
3.53
|
|
6.17
|
|
0.98
|
|
18.73
|
|
22.33
|
|
3.55
|
-
Diluted
|
2.82
|
|
3.37
|
|
5.94
|
|
0.94
|
|
17.70
|
|
21.32
|
|
3.39
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ADSs used in
calculating net earnings per ADS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
Basic
|
50,150,943
|
|
48,531,933
|
|
46,042,165
|
|
46,042,165
|
|
50,046,509
|
|
48,753,019
|
|
48,753,019
|
-
Diluted
|
52,983,934
|
|
50,794,515
|
|
47,749,760
|
|
47,749,760
|
|
52,963,675
|
|
51,076,065
|
|
51,076,065
|
SOURCE Perfect World Co., Ltd.