Live Conference Call to be Held at
9:00 PM U.S. Eastern Time on
May 14, 2018
BEIJING, May 14, 2018 /PRNewswire/ -- Phoenix New Media
Limited (NYSE: FENG) ("Phoenix New Media", "ifeng" or the
"Company"), a leading new media company in China, today announced its unaudited financial
results for the first quarter ended March
31, 2018.
"We are delighted to start the year 2018 with solid financial
and operating performance, and pleased to see that our mobile
advertising remained a strong growth driver in the first quarter,"
stated Mr. Shuang Liu, CEO of
Phoenix New Media. "Our strong media DNA and our mission to provide
high-quality, professional and unbiased news content allows us to
stay at the forefront of the media space in the long run. During
the quarter, we further enhanced our artificial intelligence
solutions by adding editorial recommendations. In doing so, we have
not only improved the efficiency of our content distribution and
the accuracy of our audience targeting, but also enriched with
humanity and value into digital media, thus further differentiating
ourselves from peers. We are also building out our content
ecosystem that includes both original content and we-media content.
Together with our premium brand equity and synergy among our
diversified business segments, we believe we are well positioned to
capitalize on the opportunities in China's rapidly growing socially responsible
media industry."
Ms. Betty Ho, CFO of Phoenix New
Media, further stated, "We are pleased to carry the strong growth
of our mobile advertising revenues, which increased by 46.3% under
the old accounting standard of ASC605, into the first quarter of
2018 despite of seasonality factors. Due to the adoption of the new
accounting standard of ASC606 on January 1,
2018, our total revenues decreased by 3.4% year over year to
RMB284.4 million in the first quarter
of 2018. Excluding the impact of adoption of the new accounting
standard, or under ASC605, our total revenues would have increased
by 5.2% year over year to RMB309.9
million in the first quarter of 2018. Net advertising
revenue increased by 10.5% year-over-year, driven by the strong
growth in mobile advertising revenues at 46.3% year-over-year. In
addition, our gross margin in the first quarter of 2018 increased
to 54.9% under the new accounting standard of ASC606 (50.0% under
ASC605), from 44.8% in the first quarter of 2017. Looking forward,
we will continue to differentiate our products by enhancing our
content offerings, while taking strict control over our cost and
expense, in order to generate long-term return to our
shareholders"
Adoption of ASC606
Beginning from January 1, 2018,
the Company adopted a new accounting standard of ASC606, Revenue
from Contracts with Customers (the "new accounting standard").
The main impact of applying the new accounting standard on the
Company's financial results include, (1) sales taxes and
surcharges, previously presented as a component of cost of
revenues, are now presented as a reduction item of revenues, and
(2) some advertising-for-advertising barter transactions,
previously not recognized as revenues, are now recognized as
revenues. By applying the modified retrospective method under the
new accounting standard, the financial statements of prior periods
are not retrospectively adjusted as the cumulative effect of
initially applying the guidance at January
1, 2018, the date of initial application, is not material.
Accordingly, the financial data presented in the Company's
financial statements for the first quarter of 2018 are in
accordance with the new accounting standard while all financial
data presented for the quarters of 2017 are in accordance with
ASC605, Revenue Recognition (the "old accounting
standard").
Impact of applying the new accounting standard on the Company's
unaudited financial results for the quarter ended March 31, 2018 as compared to the old accounting
standard is as follows:
|
Three Months Ended
March 31, 2018
|
|
|
|
Adjustments
|
|
|
|
Old Accounting
Standard (1)
|
|
Sales Taxes And
Surcharges
|
|
Barter
Transactions
|
|
Contract
Fulfillment Costs
|
|
New Accounting
Standard (2)
|
|
(RMB in
thousands)
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
309,918
|
|
(25,739)
|
|
233
|
|
-
|
|
284,412
|
Net advertising revenues
|
266,284
|
|
(23,656)
|
|
233
|
|
-
|
|
242,861
|
Paid services revenues
|
43,634
|
|
(2,083)
|
|
-
|
|
-
|
|
41,551
|
Cost of
revenues
|
(154,887)
|
|
25,739
|
|
(172)
|
|
1,087
|
|
(128,233)
|
Gross
profit
|
155,031
|
|
-
|
|
61
|
|
1,087
|
|
156,179
|
Operating
expenses
|
(213,384)
|
|
-
|
|
(645)
|
|
-
|
|
(214,029)
|
Sales and marketing expenses
|
(130,574)
|
|
-
|
|
(645)
|
|
-
|
|
(131,219)
|
Loss from
operations
|
(58,353)
|
|
-
|
|
(584)
|
|
1,087
|
|
(57,850)
|
|
|
|
|
|
|
|
|
|
|
Note:
|
(1) This financial
information for the three months ended March 31, 2018 is presented
under the old accounting standard (ASC605).
|
(2) This financial
information for the three months ended March 31, 2018 is presented
under the new accounting standard (ASC606).
|
First Quarter 2018 Financial Results
REVENUES
Total revenues for the first quarter of 2018 were RMB284.4 million (US$45.3
million) under the new accounting standard, which
represented a decrease of 3.4% from RMB294.5
million in the first quarter of 2017.
Net advertising revenues for the first quarter of 2018 were
RMB242.9 million (US$38.7 million) (net of advertising agency
service fees and sales taxes and surcharges) under the new
accounting standard, which represented an increase of 0.7% from
RMB241.1 million in the first quarter
of 2017.
Paid services revenues[1] for the first quarter of
2018 were RMB41.6 million
(US$6.6 million) under the new
accounting standard, which represented a decrease of 22.2% from
RMB53.4 million in the first quarter
of 2017. Revenues from digital entertainment[2] for the
first quarter of 2018 were RMB32.8
million (US$5.2 million) under
the new accounting standard, which represented a decrease of 22.6%
from RMB42.3 million in the first
quarter of 2017. Revenues from games and others[3] for
the first quarter of 2018 were RMB8.4
million (US$1.3 million) under
the new accounting standard, which represented a decrease of 24.1%
from RMB11.1 million in the first
quarter of 2017.
Under the old accounting standard ASC605, total revenues for the
first quarter of 2018 would have been RMB309.9 million (US$49.4
million), which would have represented an increase of 5.2%
from RMB294.5 million in the first
quarter of 2017.
Under the old accounting standard ASC605, net advertising
revenues for the first quarter of 2018 would have been RMB266.3 million (US$42.5
million), which would have represented an increase of 10.5%
from RMB241.1 million in the first
quarter of 2017, primarily attributable to a 46.3% year-over-year
increase in mobile advertising revenues that was partially offset
by a 26.0% year-over-year decrease in PC advertising revenues.
Under the old accounting standard ASC605, paid services revenues
for the first quarter of 2018 would have been RMB43.6 million (US$7.0
million), which would have represented a decrease of 18.3%
from RMB53.4 million in the first
quarter of 2017. Under the old accounting standard ASC605, revenues
from digital entertainment for the first quarter of 2018 would have
been RMB34.7 million (US$5.5 million), which would have represented a
decrease of 17.9% from RMB42.3
million in the first quarter of 2017, due to a 30.9%
decrease in the MVAS revenues mainly resulting from the decline in
users' demand for services provided through telecom operators in
China. Under the old accounting
standard ASC605, revenues from games and others for the first
quarter of 2018 would have been RMB8.9
million (US$1.4 million),
which would have represented a decrease of 19.6% from RMB11.1 million in the first quarter of 2017,
primarily attributable to a decrease in revenues generated from
web-based games operated on the Company's own platform.
COST OF REVENUES
Cost of revenues for the first quarter of 2018 was RMB128.2 million (US$20.4
million) under the new accounting standard, which
represented a decrease of 21.1% from RMB162.5 million in the first quarter of 2017.
Under the old accounting standard, cost of revenues for the first
quarter of 2018 would have been RMB154.9
million (US$24.7 million),
which would have represented a decrease of 4.7% from RMB162.5 million in the first quarter of 2017.
Such decrease was mainly due to:
- The sales taxes and surcharges were RMB25.8 million (US$4.1
million) in the first quarter of 2018, which was excluded
from cost of revenues and recorded as a reduction item of revenues
under the new accounting standard, as compared to sales taxes and
surcharges of RMB24.3 million in the
first quarter of 2017, which was recorded as a component of cost of
revenues under the old accounting standard.
- Content and operational costs for the first quarter of 2018
decreased slightly to RMB105.3
million (US$16.8 million) from
RMB106.3 million in the first quarter
of 2017.
- Revenue sharing fees to telecom operators and channel partners
for the first quarter of 2018 decreased by 50.2% to RMB8.6 million (US$1.4
million) from RMB17.3 million
in the first quarter of 2017, primarily attributable to a decrease
in the sales of MVAS products.
- Bandwidth costs for the first quarter of 2018 decreased
slightly to RMB14.3 million
(US$2.3 million) from RMB14.5 million in the first quarter of
2017.
- Share-based compensation included in cost of revenues was
RMB0.2 million (US$0.03 million) in the first quarter of 2018, as
compared to RMB1.6 million in the
first quarter of 2017. The decrease was primarily due to the lesser
share-based compensation recognized in the first quarter of 2018
for share options granted before 2017, as the Company recognized
share-based compensation, net of estimated forfeitures, on a
graded-vesting basis over the vesting term of the awards.
GROSS PROFIT
Gross profit for the first quarter of 2018 was RMB156.2 million (US$24.9
million), as compared to RMB132.0
million in the first quarter of 2017. Gross margin for the
first quarter of 2018 was 54.9%, as compared to 44.8% in the first
quarter of 2017. The increase in gross margin was primarily
attributable to the slight decrease in revenues under the new
accounting standard and the more significant decrease in certain
cost of revenues as explained above.
To supplement the financial measures presented in accordance
with the United States Generally Accepted Accounting Principles
("GAAP"), the Company has presented certain non-GAAP financial
measures in this press release, which excluded the impact of
certain reconciling items as stated in the "Use of Non-GAAP
Financial Measures" section below. The related reconciliations to
GAAP financial measures are presented in the accompanying
"Reconciliations of Non-GAAP Results of Operation Measures to the
Nearest Comparable GAAP Measures."
Non-GAAP gross margin for the first quarter of 2018, which
excluded share-based compensation, was 55.0%, as compared to 45.4%
in the first quarter of 2017.
OPERATING EXPENSES AND LOSS FROM
OPERATIONS
Total operating expenses for the first quarter of 2018 increased
by 24.4% to RMB214.0 million
(US$34.1 million) from RMB172.0 million in the first quarter of 2017,
primarily attributable to an increase in traffic acquisition
expenses. Share-based compensation included in operating expenses
was RMB3.2 million (US$0.5 million) in the first quarter of 2018, as
compared to RMB6.6 million in the
first quarter of 2017. The decrease in share-based compensation was
primarily due to the lesser share-based compensation recognized in
the first quarter of 2018 for share options granted before 2017, as
the Company recognized share-based compensation, net of estimated
forfeitures, on a graded-vesting basis over the vesting term of the
awards, and due to the fact that several batches of share options
granted to employees in 2013 became fully vested in 2017 and the
corresponding share-based compensation were no longer recognized in
2018.
Loss from operations for the first quarter of 2018 was
RMB57.9 million (US$9.2 million), as compared to loss from
operations of RMB40.1 million in the
first quarter of 2017. Operating margin for the first quarter of
2018 was negative 20.3%, as compared to negative 13.6% in the first
quarter of 2017, which was primarily attributable to the increase
in traffic acquisition expenses.
Non-GAAP loss from operations for the first quarter of 2018,
which excluded share-based compensation, was RMB54.4 million (US$8.7
million), as compared to non-GAAP loss from operations of
RMB31.8 million in the first quarter
of 2017. Non-GAAP operating margin for the first quarter of 2018,
which excluded share-based compensation, was negative 19.1%, as
compared to negative 10.8% in the first quarter of 2017.
OTHER INCOME OR
LOSS
Other income or loss reflects interest income, interest expense,
foreign currency exchange gain or loss, income or loss from equity
investments, including impairments, and others, net[4].
Total net other income for the first quarter of 2018 was negative
RMB5.2 million (US$0.8 million), as compared to RMB4.8 million in the first quarter of 2017.
- Interest income for the first quarter of 2018 was RMB12.9 million (US$2.1
million), as compared to RMB12.7
million in the first quarter of 2017.
- Interest expense for the first quarter of 2018 decreased to
RMB4.6 million (US$0.7 million), from RMB6.3 million in the first quarter of 2017,
which was primarily due to the decrease in outstanding short-term
bank loans in the first quarter of 2018 as compared to that in
2017.
- Foreign currency exchange loss for the first quarter of 2018
was RMB15.1 million (US$2.4 million), as compared to foreign currency
exchange loss of RMB2.3 million in
the first quarter of 2017, which was mainly caused by the further
appreciation of Renminbi against US dollars in the first quarter of
2018.
- Loss from equity investments, including impairments, for the
first quarter of 2018 was RMB2.4
million (US$0.4 million), as
compared to loss from equity investments, including impairments, of
RMB0.7 million in the first quarter
of 2017.
- Others, net, for the first quarter of 2018 increased by 186.9%
to RMB4.1 million (US$0.7 million), from RMB1.4 million in the first quarter of 2017,
which was primarily attributable to the decrease in litigation
provisions as a result of the settlement of several claims in
March 2018 and the increase of
government subsidies received in the first quarter of 2018.
NET LOSS ATTRIBUTABLE TO PHOENIX NEW MEDIA LIMITED
Net loss attributable to Phoenix New Media Limited for the first
quarter of 2018 was RMB57.5 million
(US$9.2 million), as compared to a
net loss of RMB32.2 million in the
first quarter of 2017. Net margin for the first quarter of 2018 was
negative 20.2%, as compared to negative 10.9% in the first quarter
of 2017. Net loss per diluted ADS[5] in the first
quarter of 2018 was RMB0.79
(US$0.13), as compared to net loss
per diluted ADS of RMB0.45 in the
first quarter of 2017.
Non-GAAP net loss attributable to Phoenix New Media Limited for
the first quarter of 2018, which excluded share-based compensation
and income or loss from equity investments, including impairments,
was RMB51.7 million (US$8.2 million), as compared to non-GAAP net loss
attributable to Phoenix New Media Limited of RMB23.2 million in the first quarter of 2017.
Non-GAAP net margin for the first quarter of 2018 was negative
18.2%, as compared to negative 7.9% in the first quarter of 2017.
Non-GAAP net loss per diluted ADS in the first quarter of 2018 was
RMB0.71 (US$0.11), as compared to non-GAAP net loss per
diluted ADS of RMB0.32 in the first
quarter of 2017.
For the first quarter of 2018, the Company's weighted average
number of ADSs used in the computation of diluted net income per
ADS was 72,403,514. As of March 31,
2018, the Company had a total of 578,729,336 ordinary shares
outstanding, or the equivalent of 72,341,167 ADSs.
CERTAIN BALANCE SHEET ITEMS
As of March 31, 2018, the
Company's cash and cash equivalents, term deposits and short term
investments and restricted cash were RMB1.30
billion (US$207.6 million).
Restricted cash represents deposits placed as security for banking
facilities granted to the Company, which are restricted in their
withdrawal or usage.
Business Outlook
Based on the new accounting standard (ASC606), for the second
quarter of 2018, the Company expects its total revenues to be
between RMB361.4 million and
RMB376.4 million; net advertising
revenues are expected to be between RMB320.5
million and RMB330.5 million;
and paid services revenues are expected to be between RMB40.9 million and RMB45.9 million.
If the old accounting standard (ASC605) were to be used, for the
second quarter of 2018, the Company would expect its total revenues
to be between RMB396.8 million and
RMB411.8 million, its net advertising
revenues to be between RMB353.5
million and RMB363.5 million,
and its paid services revenues to be between RMB43.3 million and RMB48.3 million.
All of the above forecasts reflect the Company's current and
preliminary view on the market and operational conditions, which
are subject to change.
Conference Call Information
The Company will hold a conference call at 9:00 p.m. U.S. Eastern Time on May 14, 2018 (May 15,
2018 at 9:00 a.m. Beijing/Hong
Kong time) to discuss its first quarter 2018 unaudited
financial results and operating performance.
To participate in the call, please use the dial-in numbers and
conference ID below:
International:
|
+6567135090
|
Mainland
China:
|
4006208038
|
Hong Kong:
|
+85230186771
|
United
States:
|
+18456750437
|
Conference
ID:
|
6370379
|
A replay of the call will be available through May 21, 2018 by using the dial-in numbers and
conference ID below:
International:
|
+61281990299
|
Mainland
China:
|
4006322162
|
Hong Kong:
|
+85230512780
|
United
States:
|
+16462543697
|
Conference
ID:
|
6370379
|
A live and archived webcast of the conference call will also be
available at the Company's investor relations website at
http://ir.ifeng.com.
Use of Non-GAAP Financial Measures
To supplement the consolidated financial statements presented in
accordance with the United States Generally Accepted Accounting
Principles ("GAAP"), Phoenix New Media Limited uses non-GAAP gross
profit, non-GAAP gross margin, non-GAAP income or loss from
operations, non-GAAP operating margin, non-GAAP net income or loss
attributable to Phoenix New Media Limited, non-GAAP net margin and
non-GAAP net income or loss per diluted ADS, each of which is a
non-GAAP financial measure. Non-GAAP gross profit is gross profit
excluding share-based compensation. Non-GAAP gross margin is
non-GAAP gross profit divided by total revenues. Non-GAAP income or
loss from operations is income or loss from operations excluding
share-based compensation. Non-GAAP operating margin is non-GAAP
income or loss from operations divided by total revenues. Non-GAAP
net income or loss attributable to Phoenix New Media Limited is net
income or loss attributable to Phoenix New Media Limited excluding
share-based compensation and income or loss from equity
investments, including impairments. Non-GAAP net margin is non-GAAP
net income or loss attributable to Phoenix New Media Limited
divided by total revenues. Non-GAAP net income or loss per diluted
ADS is non-GAAP net income or loss attributable to Phoenix New
Media Limited divided by weighted average number of diluted ADSs.
The Company believes that separate analysis and exclusion of the
aforementioned non-GAAP to GAAP reconciling items add clarity to
the constituent parts of its performance. The Company reviews these
non-GAAP financial measures together with the related GAAP
financial measures to obtain a better understanding of its
operating performance. It uses these non-GAAP financial measures
for planning, forecasting and measuring results against the
forecast. The Company believes that using these non-GAAP financial
measures to evaluate its business allows both management and
investors to assess the Company's performance against its
competitors and ultimately monitor its capacity to generate returns
for investors. The Company also believes that these non-GAAP
financial measures are useful supplemental information for
investors and analysts to assess its operating performance without
the effect of items like share-based compensation and income or
loss from equity investments, including impairments, which have
been and will continue to be significant and recurring in its
business. However, the use of these non-GAAP financial measures has
material limitations as an analytical tool. One of the limitations
of using these non-GAAP financial measures is that they do not
include all items that impact the Company's gross profit, income or
loss from operations and net income or loss attributable to Phoenix
New Media Limited for the period. In addition, because these
non-GAAP financial measures are not calculated in the same manner
by all companies, they may not be comparable to other similarly
titled measures used by other companies. In light of the foregoing
limitations, you should not consider these non-GAAP financial
measures in isolation from, or as an alternative to, the financial
measures prepared in accordance with GAAP.
Exchange Rate
This announcement contains translations of certain RMB amounts
into U.S. dollars ("USD") at specified rates solely for the
convenience of the reader. Unless otherwise stated, all
translations from RMB to USD were made at the rate of RMB6.2726 to US$1.00, the noon buying rate in effect on
March 30, 2018 in the H.10
statistical release of the Federal Reserve Board. The Company makes
no representation that the RMB or USD amounts referred could be
converted into USD or RMB, as the case may be, at any particular
rate or at all. For analytical presentation, all percentages are
calculated using the numbers presented in the financial statements
contained in this earnings release.
About Phoenix New Media Limited
Phoenix New Media Limited (NYSE: FENG) is a leading new media
company providing premium content on an integrated Internet
platform, including PC and mobile, in China. Having originated from a leading global
Chinese language TV network based in Hong
Kong, Phoenix TV, the Company enables consumers to access
professional news and other quality information and share
user-generated content on the Internet through their PCs and mobile
devices. Phoenix New Media's platform includes its PC channel,
consisting of ifeng.com website, which comprises interest-based
verticals such as news, finance, fashion, military and digital
reading, and interactive services; its mobile channel, consisting
of mobile news applications, mobile video application, HTML5-based
mobile Internet websites, and mobile digital reading application;
and its operations with the telecom operators that provides content
and mobile value-added services.
Safe Harbor Statement
This announcement contains forward−looking statements. These
statements are made under the "safe harbor" provisions of 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 business outlook and quotations from management in this
announcement, as well as Phoenix New Media's strategic and
operational plans, contain forward−looking statements. Phoenix New
Media may also make written or oral forward−looking statements in
its periodic reports to the U.S. Securities and Exchange Commission
("SEC") on Forms 20−F and 6−K, in its annual report to
shareholders, in press releases and other written materials and in
oral statements made by its officers, directors or employees to
third parties. Statements that are not historical facts, including
statements about Phoenix New Media's beliefs and expectations, are
forward−looking statements. Forward−looking statements involve
inherent risks and uncertainties. A number of factors could cause
actual results to differ materially from those contained in any
forward−looking statement, including but not limited to the
following: the Company's goals and strategies; the Company's future
business development, financial condition and results of
operations; the expected growth of online and mobile advertising,
online video and mobile paid services markets in China; the Company's reliance on online and
mobile advertising and MVAS for a majority of its total revenues;
the Company's expectations regarding demand for and market
acceptance of its services; the Company's expectations regarding
maintaining and strengthening its relationships with advertisers,
partners and customers; fluctuations in the Company's quarterly
operating results; the Company's plans to enhance its user
experience, infrastructure and services offerings; the Company's
reliance on mobile operators in China to provide most of its MVAS; changes by
mobile operators in China to their
policies for MVAS; competition in its industry in China; and relevant government policies and
regulations relating to the Company. Further information regarding
these and other risks is included in the Company's filings with the
SEC, including its registration statement on Form F−1, as amended,
and its annual reports on Form 20−F. All information provided in
this press release and in the attachments is as of the date of this
press release, and Phoenix New Media does not undertake any
obligation to update any forward−looking statement, except as
required under applicable law.
[1]
|
Paid services revenues comprise
of (i) revenues from digital entertainment, which includes MVAS and
digital reading, and (ii) revenues from games and others, which
includes web-based games, mobile games, content sales, and other
online and mobile paid services through the Company's own
platforms
|
|
|
[2]
|
Digital entertainment includes
mobile value-added services delivered through telecom operators'
platforms, or MVAS, and digital reading.
|
|
|
[3]
|
Games and others include
web-based and mobile games, and other online and mobile paid
services through the Company's own platforms
|
|
|
[4]
|
"Others, net" primarily
consists of government subsidies and litigation loss
provisions.
|
|
|
[5]
|
"ADS" means American Depositary
Share of the Company. Each ADS represents eight Class A ordinary
shares of the Company.
|
For investor and media inquiries please contact:
Phoenix New Media Limited
Nicole Shan
Email: investorrelations@ifeng.com
ICR, Inc.
Rose Zu
Tel: +1 (646) 405-4883
Email: investorrelations@ifeng.com
Phoenix New Media
Limited
|
Condensed
Consolidated Balance Sheets
|
(Amounts in
thousands)
|
|
|
December
31,
|
|
March
31,
|
|
March
31,
|
2017
|
|
2018
|
|
2018
|
|
RMB
|
|
RMB
|
|
US$
|
|
Audited*
|
|
Unaudited
|
|
Unaudited
|
ASSETS
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
Cash and cash
equivalents
|
362,862
|
|
343,401
|
|
54,746
|
Term deposits and
short term investments
|
737,657
|
|
511,850
|
|
81,601
|
Restricted
cash
|
336,700
|
|
447,000
|
|
71,262
|
Accounts receivable,
net
|
458,744
|
|
389,570
|
|
62,107
|
Amounts due from
related parties
|
187,214
|
|
184,925
|
|
29,481
|
Prepayment and other
current assets
|
57,458
|
|
59,935
|
|
9,555
|
Convertible loans due
from a related party
|
102,631
|
|
99,777
|
|
15,907
|
Total current
assets
|
2,243,266
|
|
2,036,458
|
|
324,659
|
Non-current
assets:
|
|
|
|
|
|
Property and
equipment, net
|
64,454
|
|
81,546
|
|
13,000
|
Intangible assets,
net
|
6,712
|
|
6,173
|
|
984
|
Available-for-sale
investments
|
1,196,330
|
|
1,197,636
|
|
190,931
|
Equity investments,
net
|
15,342
|
|
12,912
|
|
2,058
|
Deferred tax
assets
|
60,460
|
|
67,717
|
|
10,796
|
Other non-current
assets
|
12,544
|
|
14,440
|
|
2,303
|
Total non-current
assets
|
1,355,842
|
|
1,380,424
|
|
220,072
|
Total
assets
|
3,599,108
|
|
3,416,882
|
|
544,731
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
Short-term bank
loans
|
330,000
|
|
296,626
|
|
47,289
|
Accounts
payable
|
262,657
|
|
259,651
|
|
41,394
|
Amounts due to related
parties
|
14,140
|
|
12,230
|
|
1,950
|
Advances from
customers
|
65,196
|
|
55,418
|
|
8,835
|
Taxes
payable
|
92,214
|
|
76,664
|
|
12,222
|
Salary and welfare
payable
|
134,471
|
|
95,766
|
|
15,267
|
Accrued expenses and
other current liabilities
|
173,253
|
|
135,487
|
|
21,600
|
Total current
liabilities
|
1,071,931
|
|
931,842
|
|
148,557
|
Non-current
liabilities:
|
|
|
|
|
|
Deferred tax
liabilities
|
1,312
|
|
1,312
|
|
209
|
Long-term
liabilities
|
24,714
|
|
25,077
|
|
3,998
|
Total non-current
liabilities
|
26,026
|
|
26,389
|
|
4,207
|
Total
liabilities
|
1,097,957
|
|
958,231
|
|
152,764
|
Shareholders'
equity:
|
|
|
|
|
|
Phoenix New Media
Limited shareholders' equity:
|
|
|
|
|
|
Class A ordinary
shares
|
17,180
|
|
17,268
|
|
2,753
|
Class B ordinary
shares
|
22,053
|
|
22,053
|
|
3,516
|
Additional paid-in
capital
|
1,587,575
|
|
1,591,950
|
|
253,794
|
Statutory
reserves
|
81,237
|
|
81,237
|
|
12,951
|
Retained
earnings
|
229,250
|
|
171,686
|
|
27,371
|
Accumulated other
comprehensive income
|
570,244
|
|
581,594
|
|
92,720
|
Total Phoenix New
Media Limited shareholders' equity
|
2,507,539
|
|
2,465,788
|
|
393,105
|
Noncontrolling
interests
|
(6,388)
|
|
(7,137)
|
|
(1,138)
|
Total
shareholders' equity
|
2,501,151
|
|
2,458,651
|
|
391,967
|
Total liabilities
and shareholders' equity
|
3,599,108
|
|
3,416,882
|
|
544,731
|
|
|
|
|
|
|
* Derived from
audited financial statements included in the Company's Form 20-F
dated April 26, 2018.
|
Phoenix New Media
Limited
|
Condensed
Consolidated Statements of Comprehensive Income
|
(Amounts in
thousands, except for number of shares and per share (or ADS)
data)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
March
31,
|
|
December
31,
|
|
March
31,
|
|
March
31,
|
|
|
|
2017
|
|
2017
|
|
2018
|
|
2018
|
|
|
|
RMB
|
|
RMB
|
|
RMB
|
|
US$
|
|
|
|
Unaudited
|
|
Unaudited
|
|
Unaudited
|
|
Unaudited
|
|
|
|
|
|
|
|
|
|
|
|
Revenues:
|
|
|
|
|
|
|
|
|
|
Net
advertising revenues
|
|
241,084
|
|
410,547
|
|
242,861
|
|
38,718
|
|
Paid service
revenues
|
|
53,395
|
|
51,240
|
|
41,551
|
|
6,624
|
|
Total
revenues
|
|
294,479
|
|
461,787
|
|
284,412
|
|
45,342
|
|
Cost of
revenues
|
|
(162,489)
|
|
(208,679)
|
|
(128,233)
|
|
(20,443)
|
|
Gross
profit
|
|
131,990
|
|
253,108
|
|
156,179
|
|
24,899
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
Sales and
marketing expenses
|
|
(95,462)
|
|
(156,590)
|
|
(131,219)
|
|
(20,919)
|
|
General and
administrative expenses
|
|
(31,951)
|
|
(50,457)
|
|
(34,398)
|
|
(5,484)
|
|
Technology and
product development expenses
|
|
(44,628)
|
|
(51,494)
|
|
(48,412)
|
|
(7,718)
|
|
Total operating
expenses
|
|
(172,041)
|
|
(258,541)
|
|
(214,029)
|
|
(34,121)
|
|
Loss from
operations
|
|
(40,051)
|
|
(5,433)
|
|
(57,850)
|
|
(9,222)
|
|
Other
income/(loss):
|
|
|
|
|
|
|
|
|
|
Interest
income
|
|
12,658
|
|
13,213
|
|
12,938
|
|
2,063
|
|
Interest
expenses
|
|
(6,349)
|
|
(3,746)
|
|
(4,633)
|
|
(739)
|
|
Foreign
currency exchange loss
|
|
(2,311)
|
|
(4,481)
|
|
(15,131)
|
|
(2,412)
|
|
(Loss)/income
from equity investments, including impairments
|
|
(664)
|
|
4,865
|
|
(2,430)
|
|
(387)
|
|
Others,
net
|
|
1,427
|
|
10,037
|
|
4,093
|
|
653
|
|
(Loss)/income
before tax
|
|
(35,290)
|
|
14,455
|
|
(63,013)
|
|
(10,044)
|
|
Income tax
benefit/(expense)
|
|
2,341
|
|
(3,294)
|
|
4,724
|
|
753
|
|
Net
(loss)/income
|
|
(32,949)
|
|
11,161
|
|
(58,289)
|
|
(9,291)
|
|
Net loss
attributable to noncontrolling interests
|
|
775
|
|
660
|
|
749
|
|
119
|
|
Net (loss)/income
attributable to Phoenix New Media Limited
|
|
(32,174)
|
|
11,821
|
|
(57,540)
|
|
(9,172)
|
|
Net
(loss)/income
|
|
(32,949)
|
|
11,161
|
|
(58,289)
|
|
(9,291)
|
|
Other
comprehensive income, net of tax: fair value remeasurement for
available-for-sale investments (1)
|
|
8,891
|
|
22,227
|
|
46,364
|
|
7,392
|
|
Other
comprehensive loss, net of tax: foreign currency translation
adjustment
|
|
(3,767)
|
|
(14,609)
|
|
(35,014)
|
|
(5,582)
|
|
Comprehensive
(loss)/income
|
|
(27,825)
|
|
18,779
|
|
(46,939)
|
|
(7,481)
|
|
Comprehensive
loss attributable to noncontrolling interests
|
|
775
|
|
660
|
|
749
|
|
119
|
|
Comprehensive
(loss)/income attributable to Phoenix New Media
Limited
|
|
(27,050)
|
|
19,439
|
|
(46,190)
|
|
(7,362)
|
|
Net (loss)/income
attributable to Phoenix New Media Limited
|
|
(32,174)
|
|
11,821
|
|
(57,540)
|
|
(9,172)
|
|
Net (loss)/income per
Class A and Class B ordinary share:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
(0.06)
|
|
0.02
|
|
(0.10)
|
|
(0.02)
|
|
Diluted
|
|
(0.06)
|
|
0.02
|
|
(0.10)
|
|
(0.02)
|
|
Net (loss)/income per
ADS (1 ADS represents 8 Class A ordinary shares):
|
|
|
|
|
|
|
|
|
|
Basic
|
|
(0.45)
|
|
0.16
|
|
(0.79)
|
|
(0.13)
|
|
Diluted
|
|
(0.45)
|
|
0.16
|
|
(0.79)
|
|
(0.13)
|
|
Weighted average
number of Class A and Class B ordinary shares used in computing net
(loss)/income per share:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
573,935,277
|
|
576,851,243
|
|
579,228,111
|
|
579,228,111
|
|
Diluted
|
|
573,935,277
|
|
591,174,724
|
|
579,228,111
|
|
579,228,111
|
|
|
|
|
|
|
|
|
|
|
|
(1) The Company
adopted ASU 2016-1, Recognition and Measurement of Financial Assets
and Financial Liabilities, beginning from January 1, 2018. After
the adoption of this new accounting standard, the Company measures
long-term equity investments other than equity method investments
at fair value through earnings. As investments in Particle meet the
definition of debt securities, which are recorded as
available-for-sale investments, there is no impact by the adoption
of ASU 2016-1 on the available-for-sale investments in Particle and
the changes in their fair value continue to be recorded in other
comprehensive income.
|
Phoenix New Media
Limited
|
Condensed Segments
Information
|
(Amounts in
thousands)
|
|
Three Months
Ended
|
|
|
March
31,
|
|
December
31,
|
|
March
31,
|
|
March
31,
|
|
|
2017
|
|
2017
|
|
2018
|
|
2018
|
|
|
RMB
|
|
RMB
|
|
RMB
|
|
US$
|
|
|
Unaudited
|
|
Unaudited
|
|
Unaudited
|
|
Unaudited
|
|
Revenues:
|
|
|
|
|
|
|
|
|
Net
advertising service
|
241,084
|
|
410,547
|
|
242,861
|
|
38,718
|
|
Paid
services
|
53,395
|
|
51,240
|
|
41,551
|
|
6,624
|
|
Total
revenues
|
294,479
|
|
461,787
|
|
284,412
|
|
45,342
|
|
Cost of
revenues
|
|
|
|
|
|
|
|
|
Net
advertising service
|
131,125
|
|
181,361
|
|
107,289
|
|
17,104
|
|
Paid
services
|
31,364
|
|
27,318
|
|
20,944
|
|
3,339
|
|
Total cost of
revenues
|
162,489
|
|
208,679
|
|
128,233
|
|
20,443
|
|
Gross
profit
|
|
|
|
|
|
|
|
|
Net
advertising service
|
109,959
|
|
229,186
|
|
135,572
|
|
21,614
|
|
Paid
services
|
22,031
|
|
23,922
|
|
20,607
|
|
3,285
|
|
Total gross
profit
|
131,990
|
|
253,108
|
|
156,179
|
|
24,899
|
|
Phoenix New Media
Limited
|
Condensed
Information of Cost of Revenues
|
(Amounts in
thousands)
|
|
Three Months
Ended
|
|
March
31,
|
|
December
31,
|
|
March
31,
|
|
March
31,
|
|
2017
|
|
2017
|
|
2018
|
|
2018
|
|
RMB
|
|
RMB
|
|
RMB
|
|
US$
|
|
Unaudited
|
|
Unaudited
|
|
Unaudited
|
|
Unaudited
|
Revenue sharing
fees
|
17,320
|
|
12,350
|
|
8,617
|
|
1,374
|
Content and
operational costs
|
106,316
|
|
143,588
|
|
105,273
|
|
16,783
|
Bandwidth
costs
|
14,528
|
|
12,830
|
|
14,343
|
|
2,286
|
Sales taxes and
surcharges
|
24,325
|
|
39,911
|
|
-
|
|
-
|
Total cost of
revenues
|
162,489
|
|
208,679
|
|
128,233
|
|
20,443
|
Reconciliations of
Non-GAAP Results of Operations Measures to the Nearest Comparable
GAAP Measures
|
(Amounts in
thousands, except for number of ADSs and per ADS
data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
March 31, 2017
|
|
Three Months Ended
December 31, 2017
|
|
Three Months Ended
March 31, 2018
|
|
|
|
Non-GAAP
|
|
|
|
|
|
Non-GAAP
|
|
|
|
|
|
Non-GAAP
|
|
|
|
GAAP
|
|
Adjustments
|
|
Non-GAAP
|
|
GAAP
|
|
Adjustments
|
|
Non-GAAP
|
|
GAAP
|
|
Adjustments
|
|
Non-GAAP
|
|
RMB
|
|
RMB
|
|
RMB
|
|
RMB
|
|
RMB
|
|
RMB
|
|
RMB
|
|
RMB
|
|
RMB
|
|
Unaudited
|
|
Unaudited
|
|
Unaudited
|
|
Unaudited
|
|
Unaudited
|
|
Unaudited
|
|
Unaudited
|
|
Unaudited
|
|
Unaudited
|
Gross
profit
|
131,990
|
|
1,623
|
(1)
|
133,613
|
|
253,108
|
|
1,221
|
(1)
|
254,329
|
|
156,179
|
|
205
|
(1)
|
156,384
|
Gross
margin
|
44.8%
|
|
|
|
45.4%
|
|
54.8%
|
|
|
|
55.1%
|
|
54.9%
|
|
|
|
55.0%
|
Income from operations
|
(40,051)
|
|
8,266
|
(1)
|
(31,785)
|
|
(5,433)
|
|
4,677
|
(1)
|
(756)
|
|
(57,850)
|
|
3,450
|
(1)
|
(54,400)
|
Operating
margin
|
-13.6%
|
|
|
|
-10.8%
|
|
-1.2%
|
|
|
|
-0.2%
|
|
-20.3%
|
|
|
|
-19.1%
|
|
|
|
8,266
|
(1)
|
|
|
|
|
4,677
|
(1)
|
|
|
|
|
3,450
|
(1)
|
|
|
|
|
664
|
(2)
|
|
|
|
|
(4,865)
|
(2)
|
|
|
|
|
2,430
|
(2)
|
|
Net (loss)/income
attributable to Phoenix New Media Limited
|
(32,174)
|
|
8,930
|
|
(23,244)
|
|
11,821
|
|
(188)
|
|
11,633
|
|
(57,540)
|
|
5,880
|
|
(51,660)
|
Net margin
|
-10.9%
|
|
|
|
-7.9%
|
|
2.6%
|
|
|
|
2.5%
|
|
-20.2%
|
|
|
|
-18.2%
|
Net (loss)/income per
ADS—diluted
|
(0.45)
|
|
|
|
(0.32)
|
|
0.16
|
|
|
|
0.16
|
|
(0.79)
|
|
|
|
(0.71)
|
Weighted average
number of ADSs used in computing diluted net (loss)/income per
ADS
|
71,741,910
|
|
|
|
71,741,910
|
|
73,896,840
|
|
|
|
73,896,840
|
|
72,403,514
|
|
|
|
72,403,514
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Share-based
compensation
|
(2) Loss/(income)
from equity investments, including impairments
|
|
Non-GAAP to GAAP
reconciling items have no income tax effect.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
View original
content:http://www.prnewswire.com/news-releases/phoenix-new-media-reports-unaudited-first-quarter-2018-financial-results-300647861.html
SOURCE Phoenix New Media Limited