BEIJING, May 14, 2012 /PRNewswire-Asia/ -- AirMedia Group
Inc. ("AirMedia" or the "Company") (Nasdaq: AMCN), a leading
operator of out-of-home advertising platforms in China targeting mid-to-high-end consumers,
today announced its unaudited financial results for the first
quarter ended March 31, 2012.
First Quarter 2012 Financial Highlights
- Total revenues increased by 10.1% year-over-year to
US$67.5 million.
- Net loss attributable to AirMedia's shareholders was
US$7.3 million. Basic and diluted net
loss attributable to AirMedia's shareholders per American
Depositary Share ("ADS") were both US$0.12.
- Adjusted net loss attributable to AirMedia's shareholders
(non-GAAP), which is net loss attributable to AirMedia's
shareholders excluding share-based compensation expenses,
amortization of acquired intangible assets, impairment of goodwill
and impairment of intangible assets, was US$5.4 million. Adjusted basic and diluted net
loss attributable to AirMedia's shareholders per ADS (non-GAAP)
were both US$0.09.
"Although we had a relatively weak first quarter due to the
usual seasonality as well as advertisers' caution and delay of
advertising spending, we haven't changed our expectation of a
strong second half of the year. We are working hard to continue to
strengthen our market position and to make our media assets more
valuable," commented Herman Guo,
chairman and chief executive officer of AirMedia.
"Despite the year-over-year decline of advertising revenues from
automobile advertisers in the first quarter of this year, strong
growth from many other sectors was more than enough to offset the
shortfall from the automobile sector. We plan to continue to
diversify our revenue sources and expect more robust growth when
automobile advertising revenues resume strong growth," Ping Sun, AirMedia's chief financial officer,
commented.
First Quarter 2012 Financial
Results
Revenues
Total revenues by product line (numbers in US$ 000's except for percentages):
|
|
Quarter
Ended March 31,2012
|
% of
Total Revenues
|
|
Quarter
Ended December 31,2011
|
% of
Total Revenues
|
|
Quarter
Ended March 31,2011
|
% of
Total Revenues
|
|
Y/Y
Growth rate
|
|
Q/Q
Growth rate
|
|
Air
Travel Media Network
|
|
62,299
|
92.2%
|
|
79,434
|
90.4%
|
|
56,973
|
92.9%
|
|
9.3%
|
|
-21.6%
|
|
Digital
frames in airports
|
|
31,927
|
47.3%
|
|
38,287
|
43.6%
|
|
30,192
|
49.2%
|
|
5.7%
|
|
-16.6%
|
|
Digital TV
screens in airports
|
|
2,169
|
3.2%
|
|
9,370
|
10.7%
|
|
5,209
|
8.5%
|
|
-58.4%
|
|
-76.9%
|
|
Digital TV screens on airplanes
|
|
5,017
|
7.4%
|
|
7,533
|
8.6%
|
|
6,799
|
11.1%
|
|
-26.2%
|
|
-33.4%
|
|
Traditional
media in airports
|
|
21,799
|
32.3%
|
|
22,234
|
25.3%
|
|
13,901
|
22.7%
|
|
56.8%
|
|
-2.0%
|
|
Other
revenues in air travel
|
|
1,387
|
2.0%
|
|
2,010
|
2.2%
|
|
872
|
1.4%
|
|
59.1%
|
|
-31.0%
|
|
Gas
Station Media Network
|
|
3,290
|
4.9%
|
|
5,948
|
6.8%
|
|
1,799
|
2.9%
|
|
82.9%
|
|
-44.7%
|
|
Other
Media
|
|
1,955
|
2.9%
|
|
2,448
|
2.8%
|
|
2,581
|
4.2%
|
|
-24.3%
|
|
-20.1%
|
|
Total
revenues
|
|
67,544
|
100.0%
|
|
87,830
|
100.0%
|
|
61,353
|
100.0%
|
|
10.1%
|
|
-23.1%
|
|
Net
revenues
|
|
66,144
|
|
|
84,994
|
|
|
59,901
|
|
|
10.4%
|
|
-22.2%
|
|
Total revenues for the first quarter of 2012 reached
US$67.5 million, representing a
year-over-year increase of 10.1% from US$61.4 million and a quarter-over-quarter
decrease of 23.1% from US$87.8
million. The year-over-year increase was primarily due to
increases in revenues from traditional media in airports, gas
station media network and digital frames in airports. The
quarter-over-quarter decrease was due to decreases in revenues from
all of the Company's product lines.
Revenues from digital frames in
airports
Revenues from digital frames in airports for the first quarter
of 2012 increased by 5.7% year-over-year and decreased by 16.6%
quarter-over-quarter to US$31.9
million. The year-over-year increase was due to the
Company's continued sales efforts and advertisers' growing
acceptance of AirMedia's digital frames. The quarter-over-quarter
decrease was primarily due to a seasonally weak quarter in the
first quarter of 2012, as well as advertisers' caution and delay of
advertising spending.
Revenues from digital TV screens in airports
Revenues from digital TV screens in airports for the first
quarter of 2012 decreased by 58.4% year-over-year and by 76.9%
quarter-over-quarter to US$2.2
million. The year-over-year and quarter-over-quarter
decreases were primarily due to a drop in demand from advertisers.
AirMedia plans to continue searching for ways to raise advertisers'
interest and to turn around this product line.
Revenues from digital TV screens on airplanes
Revenues from digital TV screens on airplanes for the first
quarter of 2012 decreased by 26.2% year-over-year and by 33.4%
quarter-over-quarter to US$5.0
million. The year-over-year and quarter-over-quarter
decreases were primarily due to a seasonally weak quarter in the
first quarter of 2012, as well as advertisers' caution and delay of
advertising spending.
Revenues from traditional media in
airports
Revenues from traditional media in airports for the first
quarter of 2012 increased by 56.8% year-over-year and decreased by
2.0% quarter-over-quarter to US$21.8
million. The year-over-year increase was primarily due to
the Company's continued sales efforts and advertisers' growing
acceptance of AirMedia's traditional media in airports. The
quarter-over-quarter decrease was primarily due to a seasonally
weak quarter in the first quarter of 2012.
Revenues from the gas station media
network
Revenues from the gas station media network for the first
quarter of 2012 increased by 82.9% year-over-year and decreased by
44.7% quarter-over-quarter to US$3.3
million. The year-over-year increase was primarily due to
the Company's continued sales efforts and advertisers' growing
acceptance of AirMedia's gas station media network. The
quarter-over-quarter decrease was primarily due to a seasonally
weak quarter in the first quarter of 2012 and the fact that sales
pace has to slow down slightly because of the lack of enough
resources to fulfill orders efficiently.
Revenues from other media
Revenues from other media were primarily revenues from unipole
signs and other outdoors media. Revenues from other media for the
first quarter of 2012 decreased by 24.3% year-over-year and
decreased by 20.1% quarter-over-quarter to US$2.0 million. The year-over-year decrease was
primarily due to a drop in demand from real estate advertisers. The
quarter-over-quarter decrease was primarily due to a seasonally
weak quarter in the first quarter of 2012.
Business tax and other sales tax
Business tax and other sales tax for the first quarter of 2012
were US$1.4 million, compared to
US$1.5 million in the same period one
year ago and US$2.8 million in the
previous quarter. For purposes of calculating the amount of
business and other sales tax, concession fees are deducted from
total revenues, as permitted under applicable PRC tax law.
Net revenues
Net revenues for the first quarter of 2012 reached US$66.1 million, representing a year-over-year
increase of 10.4% from US$59.9
million and a quarter-over-quarter decrease of 22.2% from
US$85.0 million.
Cost of Revenues
Cost of revenues for the first quarter of 2012 was US$62.8 million, representing a year-over-year
increase of 11.8% from US$56.2
million and a quarter-over-quarter decrease of 4.5% from
US$65.8 million. The year-over-year
increase was primarily due to an increase in concession fees. The
quarter-over-quarter decrease was primarily due to lower agency
fees for third-party advertising agencies. Cost of revenues as a
percentage of net revenues in the first quarter of 2012 was 95.0%,
up from 93.8% in the same period one year ago and up from 77.4% in
the previous quarter.
AirMedia incurs concession fees to airports for placing and
operating digital frames, digital TV screens, traditional media and
other displays in airports, to airlines for playing programs on
their digital TV screens, to Sinopec for placing outdoors media in
its gas stations and to other media resources owners for placing
unipole signs and other outdoors media.
Concession fees for the first quarter of 2012 increased by 14.7%
year-over-year and by 5.1% quarter-over-quarter to US$43.4 million. The year-over-year and
quarter-over-quarter increases were primarily due to newly signed
or renewed concession rights contracts during the period.
Concession fees as a percentage of net revenues in the first
quarter of 2012 was 65.7%, increasing from 63.2% in the same period
one year ago and from 48.6% in the previous quarter. The
year-over-year increase of concession fees as a percentage of net
revenues was primarily due to the fact that incremental concession
fees grew at a faster pace than revenue growth. The
quarter-over-quarter increase of concession fees as a percentage of
net revenues was primarily due to the fact that revenues decreased
while concession fees increased due to newly signed or renewed
concession rights contracts.
Gross Profit
Gross profit for the first quarter of 2012 was US$3.3 million, compared to gross profit of
US$3.7 million in the same period one
year ago and gross profit of US$19.2
million in the previous quarter.
Gross profit as a percentage of net revenues for the first
quarter of 2012 was 5.0%, compared to gross profit as a percentage
of net revenues of 6.2% in the same period one year ago and gross
profit as a percentage of net revenues of 22.6% in the previous
quarter. The year-over-year decrease in gross profit as a
percentage of net revenues was primarily due to the fact that cost
of revenues grew faster than net revenues. The quarter-over-quarter
decrease in gross profit as a percentage of net revenues was
primarily due to the fact that net revenues decreased faster than
cost of revenues.
Operating Expenses
Operating expenses (numbers in US$
000's except for percentages):
|
Quarter
Ended March 31,2012
|
% of
Net Revenues
|
|
Quarter
Ended December 31,2011
|
% of
Net Revenues
|
|
Quarter
Ended March 31,2011
|
% of
Net Revenues
|
|
Y/Y
Growth rate
|
Q/Q
Growth rate
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling
and marketing expenses
|
4,083
|
6.2%
|
|
4,984
|
5.9%
|
|
4,289
|
7.2%
|
|
-4.8%
|
-18.1%
|
General and administrative expenses
|
6,128
|
9.3%
|
|
7,245
|
8.5%
|
|
4,854
|
8.1%
|
|
26.2%
|
-15.4%
|
Impairment
of goodwill
|
-
|
0.0%
|
|
1,003
|
1.2%
|
|
-
|
0.0%
|
|
N/A
|
N/A
|
Total
operating expenses
|
10,211
|
15.5%
|
|
13,232
|
15.6%
|
|
9,143
|
15.3%
|
|
11.7%
|
-22.8%
|
Adjusted
operating expenses
(non-GAAP)
|
8,314
|
12.6%
|
|
10,695
|
12.6%
|
|
7,495
|
12.5%
|
|
10.9%
|
-22.3%
|
Total operating expenses for the first quarter of 2012 were
US$10.2 million, representing a
year-over-year increase of 11.7% from US$9.1
million and a quarter-over-quarter decrease of 22.8% from
US$13.2 million.
Total operating expenses for the first quarter of 2012 included
share-based compensation expenses of US$992,000, compared to share-based compensation
expenses of US$709,000 in the same
period one year ago and share-based compensation expenses of
US$582,000 in the previous quarter.
The year-over-year increase in share-based compensation expenses
was primarily due to the stock options granted on March 22, 2011, which did not have a full quarter
impact in the first quarter of 2011.
Adjusted operating expenses (non-GAAP) for the first quarter of
2012, which excluded share-based compensation expenses,
amortization of acquired intangible assets, impairment of goodwill,
and impairment of intangible assets, were US$8.3 million, representing a year-over-year
increase of 10.9% from US$7.5 million
and a quarter-over-quarter decrease of 22.3% from US$10.7 million. Adjusted operating expenses as a
percentage of net revenues (non-GAAP) in the first quarter of 2012
was 12.6%, compared to 12.5% in the same period one year ago and
12.6% in the previous quarter.
Please refer to the attached table captioned "Reconciliation of
GAAP Operating Expenses to Non-GAAP Adjusted Operating Expenses"
for a reconciliation of operating expenses under U.S. GAAP to
adjusted operating expenses (non-GAAP).
Selling and marketing expenses for the first quarter of 2012
were US$4.1 million, including
share-based compensation expenses of US$297,000. This represented a year-over-year
decrease of 4.8% from US$4.3 million
and a quarter-over-quarter decrease of 18.1% from US$5.0 million. The year-over-year decrease was
primarily due to lower professional fees. The quarter-over-quarter
decrease was primarily due to lower sales commissions for the
Company's direct sales force.
General and administrative expenses for the first quarter of
2012 were US$6.1 million, including
share-based compensation expenses of US$695,000. This represented a year-over-year
increase of 26.2% from US$4.9 million
and a quarter-over-quarter decrease of 15.4% from US$7.2 million. The year-over-year increase was
primarily due to higher salary expenses, higher share-based
compensation expenses, higher bad-debt provisions and higher
professional fees. The quarter-over-quarter decrease was primarily
due to lower bad-debt provisions, which were partially offset by
higher salary expenses and higher professional fees.
Loss/Income from Operations
Loss from operations for the first quarter of 2012 was
US$6.9 million, compared to loss from
operations of US$5.4 million in the
same period one year ago and income from operations of US$6.0 million in the previous quarter. Loss from
operations as a percentage of net revenues for the first quarter of
2012 was negative 10.4%, compared to negative 9.1% in the same
period one year ago and 7.1% in the previous quarter.
Adjusted loss from operations (non-GAAP) for the first quarter
of 2012, which excluded share-based compensation expenses,
amortization of acquired intangible assets, and impairment of
intangible assets, was US$5.0
million, compared to adjusted loss from operations
(non-GAAP) of US$3.8 million in the
same period one year ago and adjusted income from operations
(non-GAAP) of US$8.5 million in the
previous quarter. Adjusted operating margin (non-GAAP) for the
first quarter of 2012, which excluded the effect of share-based
compensation expenses, amortization of acquired intangible assets,
impairment of goodwill, and impairment of intangible assets, was
negative 7.5%, compared to negative 6.3% in the same period one
year ago and 10.0% in the previous quarter.
Please refer to the attached table captioned "Reconciliation of
GAAP Loss from Operations to Non-GAAP Adjusted Loss from
Operations" for a reconciliation of loss from operations under U.S.
GAAP to adjusted loss from operations (non-GAAP).
Income Tax Expenses
Income tax expenses for the first quarter of 2012 were
US$1.9 million, compared to income
tax expenses of US$522,000 in the
same period one year ago and income tax expenses of US$2.4 million in the previous quarter. The
year-over-year increase of tax expenses was primarily due to higher
valuation allowance.
Net Loss/Income Attributable
to AirMedia's Shareholders
Net loss attributable to AirMedia's shareholders for the first
quarter of 2012 was US$7.3 million,
compared to net loss attributable to AirMedia's shareholders of
US$3.9 million in the same period one
year ago and net income attributable to AirMedia's shareholders of
US$4.6 million in the previous
quarter. The basic net loss attributable to AirMedia's shareholders
per ADS for the first quarter of 2012 was US$0.12, compared to basic net loss attributable
to AirMedia's shareholders per ADS of US$0.06 in the same period one year ago and basic
net income attributable to AirMedia's shareholders per ADS of
US$0.07 in the previous quarter. The
diluted net loss attributable to AirMedia's shareholders per ADS
for the first quarter of 2012 was US$0.12, compared to diluted net loss
attributable to AirMedia's shareholders per ADS of US$0.06 in the same period one year ago and
diluted net income attributable to AirMedia's shareholders per ADS
of US$0.07 in the previous
quarter.
Adjusted net loss attributable to AirMedia's shareholders
(non-GAAP) for the first quarter of 2012, which is net loss
attributable to AirMedia's shareholders excluding share-based
compensation expenses, amortization of acquired intangible assets,
impairment of goodwill, and impairment of intangible assets, was
US$5.4 million, compared to adjusted
net loss attributable to AirMedia's shareholders (non-GAAP) of
US$2.3 million in the same period one
year ago and adjusted net income attributable to AirMedia's
shareholders (non-GAAP) of US$7.2
million in the previous quarter. Basic adjusted net loss
attributable to AirMedia's shareholders per ADS (non-GAAP) for the
first quarter of 2012 was US$0.09,
compared to basic adjusted net loss attributable to AirMedia's
shareholders per ADS (non-GAAP) of US$0.03 in the same period one year ago and basic
adjusted net income attributable to AirMedia's shareholders per ADS
(non-GAAP) of US$0.11 in the previous
quarter. Diluted adjusted net loss attributable to AirMedia's
shareholders per ADS (non-GAAP) for the first quarter of 2012 was
US$0.09, compared to diluted adjusted
net loss attributable to AirMedia's shareholders per ADS (non-GAAP)
of US$0.03 in the same period one
year ago and diluted adjusted net income attributable to AirMedia's
shareholders per ADS (non-GAAP) of US$0.11 in the previous quarter.
Please refer to the attached table captioned "Reconciliation Of
GAAP Net Income (Loss) and EPS To Non-GAAP Adjusted Net Income
(Loss) and EPS" for a reconciliation of net income (loss)
attributable to AirMedia's shareholders and basic and diluted net
income (loss) attributable to AirMedia's shareholders per ADS under
U.S. GAAP to adjusted net income (loss) attributable to AirMedia's
shareholders (non-GAAP) and basic and diluted adjusted net income
(loss) attributable to AirMedia's shareholders per ADS
(non-GAAP).
Cash and Restricted
Cash
Other than restricted cash of US$8.5
million, cash totaled US$117.9
million as of March 31, 2012,
compared to US$112.7 million as of
December 31, 2011. The increase in
cash from December 31, 2011 was
primarily due to positive cash flow from operations.
ADS Repurchases
On March 21, 2011, AirMedia's
board of directors authorized AirMedia to repurchase up to
US$20 million of its own outstanding
ADSs within two years from March 21,
2011. As of May 6, 2012,
AirMedia had repurchased an aggregate of 3,397,915 ADSs on the
open market for a total consideration of US$11.1 million.
Other Recent Developments
On May 1, 2012, AirMedia commenced
operations of 163 digital TV screens in Hangzhou Xiaoshan
International Airport in Zhejiang
province.
In April 2012, AirMedia entered
into an agreement with Asiaray Advertising Media Ltd. and Guangxi
Civil Aviation Development Co., Ltd. to form a joint venture that
exclusively operates various media resources in four airports in
China's Guangxi province. These four airports are
Nanning Wuxu International Airport, Guilin Liangjiang International
Airport, Liuzhou Bailian Airport and Beihai Fucheng Airport.
Guangxi Civil Aviation Development Co., Ltd. is a wholly-owned
subsidiary of Guangxi Airport Group, which owns and operates these
four airports.
Beginning April 6, 2012, in an
effort to improve the attractiveness of the Company's digital
frames, AirMedia changed its sales method for stand-alone digital
frames in the airports for second-tier and third-tier cities in
China. The length of advertising
time slot was changed from 12 seconds to six seconds per time slot.
The cycle time of advertisements was changed from 10 minutes to
five minutes. These changes increased the frequency of exposure for
advertisements and had no impact on the time slots available for
sale of AirMedia's digital frames. In addition, advertisers now
have the choice to purchase time slots on AirMedia's stand-alone
digital frames at departure halls or arrival halls separately or as
a whole in the airports for second-tier and third-tier cities.
On March 30, 2012, AirMedia
commenced operations of 14 digital TV screens in Yanji
Chaoyangchuan Airport in Liaoning
province.
Business Outlook
AirMedia currently expects its total revenues for the second
quarter of 2012 to range from US$68.0
million to US$70.0 million, representing a year-over-year
increase of 16.2% to 19.6% from the same period in 2011.
AirMedia currently expects its concession fees to be
approximately US$45.5 million in the
second quarter of 2012. The quarter-over-quarter increase from the
first quarter of 2012 will be primarily due to the concession fee
commitments under concession rights contracts that were newly
signed or renewed or are expected to be signed or renewed.
The above forecast reflects AirMedia's current and preliminary
view and is therefore subject to change. Please refer to the Safe
Harbor Statement below for the factors that could cause actual
results to differ materially from those contained in any
forward-looking statement.
Summary of Selected Operating Data
|
Quarter
Ended March 31,2012
|
|
Quarter
Ended December 31,2011
|
|
Quarter
Ended March 31,2011
|
|
Y/Y
Growth Rate
|
|
Q/Q
Growth Rate
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Digital
frames in airports
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of
airports in operation
|
34
|
|
34
|
|
35
|
|
-2.9%
|
|
0.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of
time slots available for sale (2)
|
32,997
|
|
35,423
|
|
34,139
|
|
-3.3%
|
|
-6.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of
time slots sold (3)
|
12,448
|
|
14,189
|
|
10,327
|
|
20.5%
|
|
-12.3%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Utilization
rate (4)
|
37.7%
|
|
40.1%
|
|
30.2%
|
|
7.5%
|
|
-2.4%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average advertising revenue per time slot sold (5)
|
US$2,565
|
|
US$2,698
|
|
US$2,924
|
|
-12.3%
|
|
-4.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Digital
TV screens in airports
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of
airports in operation
|
37
|
|
36
|
|
37
|
|
0.0%
|
|
2.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of
time slots available for sale (1)
|
17,683
|
|
18,138
|
|
18,780
|
|
-5.8%
|
|
-2.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of
time slots sold (3)
|
1,663
|
|
6,133
|
|
3,555
|
|
-53.2%
|
|
-72.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Utilization
rate (4)
|
9.4%
|
|
33.8%
|
|
18.9%
|
|
-9.5%
|
|
-24.4%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average
advertising revenue per time slot sold (5)
|
US$1,304
|
|
US$1,528
|
|
US$1,465
|
|
-11.0%
|
|
-14.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Digital
TV screens on airplanes
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of
airlines in operation
|
9
|
|
9
|
|
8
|
|
12.5%
|
|
0.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of
time slots available for sale (1)
|
444
|
|
414
|
|
414
|
|
7.2%
|
|
7.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of
time slots sold (3)
|
175
|
|
218
|
|
232
|
|
-24.6%
|
|
-19.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Utilization
rate (4)
|
39.4%
|
|
52.7%
|
|
56.0%
|
|
-16.6%
|
|
-13.3%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average
advertising revenue per time slot sold (5)
|
US$28,669
|
|
US$34,555
|
|
US$29,325
|
|
-2.2%
|
|
-17.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Traditional Media in airports
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Numbers of
locations available for sale (6)
|
914
|
|
950
|
|
875
|
|
4.5%
|
|
-3.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Numbers of
locations sold (7)
|
680
|
|
707
|
|
522
|
|
30.3%
|
|
-3.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Utilization rate (8)
|
74.4%
|
|
74.4%
|
|
59.7%
|
|
14.7%
|
|
0.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average
advertising revenue per location sold (9)
|
US$32,057
|
|
US$31,448
|
|
US$26,631
|
|
20.4%
|
|
1.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Notes:
(1) A time slot is defined as a 30-second equivalent advertising
time unit for digital TV screens in airports and digital TV screens
on airplanes, which is shown during each advertising cycle on a
weekly basis in a given airport or on a monthly basis on the routes
of a given airline, respectively. AirMedia's airport advertising
programs are shown repeatedly on a daily basis during a given week
in one-hour cycles and each hour of programming includes 20 minutes
of advertising content, which allows the Company to sell a maximum
of 40 time slots per week. The number of time slots available for
sale for the digital TV screens in airports during the period
presented is calculated by multiplying the time slots available for
sale per week per airport by the number of weeks during the period
presented when AirMedia had operations in each airport and then
calculating the sum of all the time slots available for sale for
each of the Company's network airports. The length of AirMedia's
in-flight programs typically ranges from approximately 45 minutes
to an hour per flight, approximately five to 13 minutes of which
consist of advertising content. The number of time slots available
for sale for our digital TV screens on airplanes during the period
presented is calculated by multiplying the time slots per airline
per month by the number of months during the period presented when
AirMedia had operations on each airline and then calculating the
sum of all the time slots available for sale for each of its
network airlines.
(2) A time slot is defined as a 12-second equivalent advertising
time for digital frames in airports, which is shown during each
standard advertising cycle on a weekly basis in a given airport.
AirMedia's standard airport advertising programs are shown
repeatedly on a daily basis during a given week in 10-minute
cycles, which allows the Company to sell a maximum of 50 time slots
per week. The length of time slot and advertising program cycle of
some digital frames in several airports are different from the
standard ones. The number of time slots available for sale for the
digital frames in airports during the period presented is
calculated by multiplying the time slots per week per airport by
the number of weeks during the period presented when the Company
had operations in each airport and then calculating the sum of all
the time slots available for each of its network airports.
(3) Number of time slots sold refers to the number of 30-second
equivalent advertising time units for digital TV screens in
airports and digital TV screens on airplanes or 12-second
equivalent advertising time units for digital frames in airports
sold during the period presented.
(4) Utilization rate for digital TV screens in airports, digital
TV screens on airplanes and digital frames in airports refers to
total time slots sold as a percentage of total time slots available
for sale during the relevant period.
(5) Average advertising revenue per time slot sold for digital
TV screens in airports, digital TV screens on airplanes and digital
frames in airports are calculated by dividing each of the Company's
revenues derived from digital TV screens in airports, digital TV
screens on airplanes and digital frames in airports by the
respective number of time slots sold.
(6) The number of locations available for sale in traditional
media is defined as the sum of (1) the number of light boxes and
billboards in Beijing,
Shenzhen, Wenzhou and certain
other airports (light boxes and billboards), and (2) the number of
gate bridges in certain airports (gate bridges).
(7) The number of locations sold is defined as the sum of (1)
the number of light boxes and billboards sold and (2) the number of
gate bridges sold. To calculate the number of light boxes and
billboards sold in a given airport, the "utilization rates of
light boxes and billboards" in such airport is first calculated by
dividing the "total value of light boxes and billboards sold" in
such airport by the "total value of light boxes and billboards" in
such airport. The "total value of light box and billboard
sold" in a given airport is calculated as the daily listing prices
of each light boxes and billboards sold in such airport multiplied
by their respective number of days sold during the period
presented. The "total value of light boxes and billboards" in
a given airport is calculated as the sum of quarterly listing
prices of all the light boxes and billboards in such airport during
the period presented. The number of light boxes and billboards sold
in a given airport is then calculated as the number of light boxes
and billboards available for sale in such airport multiplied by the
utilization rates of light boxes and billboards in such airport.
The number of gate bridges sold in a given airport is counted based
on numbers in the relevant contracts.
(8) Utilization rate for traditional media in airports
refers to total locations sold as a percentage of total locations
available for sale during the period presented.
(9) Average advertising revenue per location sold is
calculated by dividing the revenues derived from all the locations
sold by the number of locations sold during the period
presented.
Earnings Conference Call Details
AirMedia will hold a conference call to discuss the first
quarter 2012 earnings at 7:00 AM U.S.
Eastern Time on May 14, 2012
(4:00 AM U.S. Pacific Time on
May 14, 2012; 7:00 PM Beijing/Hong
Kong time on May 14, 2012).
AirMedia's management team will be on the call to discuss financial
results and operational highlights and answer questions.
Conference Call Dial-in Information
U.S.: +1 866 519 4004
U.K.: 08082346646
Hong Kong: +852 2475 0994
International: +1 718 354 1231
Pass code: AMCN
A replay of the call will be available for 1 week between
10:00 a.m. on May 14, 2012 and 11:59
p.m. on May 21, 2012, Eastern
Time.
Replay Dial-in Information
U.S.: +1 866 214 5335
International: +1 718 354 1232
Pass code: 74475923
Additionally, a live and archived webcast of this call will be
available on the Investor Relations section of AirMedia's corporate
website at http://ir.airmedia.net.cn.
Use of Non-GAAP Financial Measures
AirMedia's management uses non-GAAP financial measures to gain
an understanding of AirMedia's comparative operating performance
and future prospects. AirMedia's non-GAAP financial measures
exclude the following non-cash items: (1) share-based compensation
expenses, (2) amortization of acquired intangible assets, (3)
impairment of goodwill, and (4) impairment of intangible
assets.
Non-GAAP financial measures are used by AirMedia's management in
their financial and operating decision-making, because management
believes they reflect AirMedia's ongoing business and operating
performance in a manner that allows meaningful period-to-period
comparisons. AirMedia's management believes that these non-GAAP
financial measures provide useful information to investors and
others in understanding and evaluating AirMedia's operating
performance in the same manner as management does, if they so
choose. Specifically, AirMedia believes the non-GAAP financial
measures provide useful information to both management and
investors by excluding certain charges that the Company believes
are not indicative of its core operating results.
The non-GAAP financial measures have limitations. They do not
include all items of income and expense that affect AirMedia's
income from operations. Specifically, these non-GAAP financial
measures are not prepared in accordance with GAAP, may not be
comparable to non-GAAP financial measures used by other companies
and, with respect to the non-GAAP financial measures that exclude
certain items under GAAP, do not reflect any benefit that such
items may confer to AirMedia. Management compensates for these
limitations by also considering AirMedia's financial results as
determined in accordance with GAAP. The presentation of this
additional information is not meant to be considered superior to,
in isolation from or as a substitute for results prepared in
accordance with US GAAP. For more information on these non-GAAP
financial measures, please see the table captioned "Reconciliation
of GAAP Net (Loss) Income and EPS and Non-GAAP Adjusted Net (Loss)
Income and EPS", "Reconciliation of GAAP Operating Expenses to
Non-GAAP Adjusted Operating Expenses" and "Reconciliation of GAAP
(Loss) Income from Operations to Non-GAAP Adjusted (Loss) Income
from Operations" set forth at the end of this release.
About AirMedia Group Inc.
AirMedia Group Inc. (Nasdaq: AMCN) is a leading operator of
out-of-home advertising platforms in China targeting mid-to-high-end consumers.
AirMedia operates the largest digital media network in China dedicated to air travel advertising.
AirMedia operates digital frames in 34 major airports and digital
TV screens in 37 major airports, including most of the 30 largest
airports in China. In addition,
AirMedia sells advertisements on the routes operated by nine
airlines, including the four largest airlines in China. In selected major airports, AirMedia
also operates traditional media platforms, such as billboards and
light boxes, and other digital media, such as mega LED screens.
In addition, AirMedia has obtained exclusive contractual
concession rights until the end of 2014 to develop and operate
outdoor advertising platforms at Sinopec's service stations located
throughout China.
For more information about AirMedia, please visit
http://www.airmedia.net.cn.
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," "expect," "anticipate," "future," "intend," "plan,"
"believe," "estimate," "confident" and similar statements. Among
other things, the Business Outlook section and the quotations from
management in this announcement, as well as AirMedia Group Inc.'s
strategic and operational plans, contain forward-looking
statements. AirMedia may also make written or oral forward-looking
statements in its reports to the U.S. Securities and Exchange
Commission, 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 AirMedia's
beliefs and expectations, are forward-looking statements.
Forward-looking statements involve inherent risks and
uncertainties. A number of important factors could cause actual
results to differ materially from those contained in any
forward-looking statement. Potential risks and uncertainties
include, but are not limited to: if advertisers or the viewing
public do not accept, or lose interest in, AirMedia's air travel
advertising network, AirMedia may be unable to generate sufficient
cash flow from its operating activities and its prospects and
results of operations could be negatively affected; AirMedia
derives most of its revenues from the provision of air travel
advertising services, and any slowdown in the air travel
advertising industry in China may
materially and adversely affect its revenues and results of
operations; AirMedia's strategy of expanding its advertising
network by building new air travel media platforms and expanding
into traditional media in airports may not succeed, and its failure
to do so could materially reduce the attractiveness of its network
and harm its business, reputation and results of operations; if
AirMedia does not succeed in its expansion into gas station and
other outdoors media advertising, its future results of operations
and growth prospects may be materially and adversely affected; if
AirMedia's customers reduce their advertising spending or are
unable to pay AirMedia in full, in part or at all for a period of
time due to an economic downturn in China and/or elsewhere or for any other
reason, AirMedia's revenues and results of operations may be
materially and adversely affected; AirMedia faces risks related to
health epidemics, which could materially and adversely affect air
travel and result in reduced demand for its advertising services or
disrupt its operations; if AirMedia is unable to retain
existing concession rights contracts or obtain new concession
rights contracts on commercially advantageous terms that allow it
to operate its advertising platforms, AirMedia may be unable to
maintain or expand its network coverage and its business and
prospects may be harmed; a significant portion of AirMedia's
revenues has been derived from the six largest airports and four
largest airlines in China, and if
any of these airports or airlines experiences a material business
disruption, AirMedia's ability to generate revenues and its results
of operations would be materially and adversely affected;
AirMedia's limited operating history makes it difficult to evaluate
its future prospects and results of operations; and other risks
outlined in AirMedia's filings with the U.S. Securities and
Exchange Commission. AirMedia does not undertake any obligation to
update any forward-looking statement, except as required under
applicable law.
Investor Contact:
Raymond Huang
Senior Director of Investor Relations
AirMedia Group Inc.
Tel: +86-10-8460-8678
Email: ir@airmedia.net.cn
AirMedia Group Inc.
|
|
|
|
UNAUDITED CONDENSED CONSOLIDATED BALANCE
SHEETS
|
|
|
|
(In
U.S. dollars in thousands)
|
|
|
|
|
|
|
|
|
|
March
31,
2012
|
December 31,
2011
|
|
|
|
|
ASSETS:
|
|
|
|
Current
assets:
|
|
|
|
Cash
|
|
117,910
|
112,734
|
Restricted
cash
|
|
8,471
|
6,363
|
Accounts
receivable, net
|
|
85,458
|
92,823
|
Prepaid
concession fees
|
|
25,060
|
22,909
|
Amount due
from related party
|
|
148
|
148
|
Other
current assets
|
|
6,164
|
6,627
|
Deferred
tax assets - current
|
|
5,578
|
6,061
|
Total
current assets
|
|
248,789
|
247,665
|
Property
and equipment, net
|
|
51,870
|
56,429
|
Long-term
investments
|
|
3,737
|
2,047
|
Long-term
deposits
|
|
16,795
|
15,042
|
Deferred
tax assets - non-current
|
|
4,588
|
5,763
|
Acquired
intangible assets, net
|
|
12,875
|
13,788
|
Goodwill
|
|
20,722
|
20,734
|
Total
assets
|
|
359,376
|
361,468
|
LIABILITIES AND EQUITY:
|
|
|
|
Current
liabilities:
|
|
|
|
Accounts
payable (including accounts payable of the
|
|
|
|
consolidated
variable interest entities without recourse to
|
|
|
|
AirMedia
Group Inc. $61,697 and $68,946 as of December 31,
|
|
|
|
2011 and
March 31, 2012, respectively)
|
|
70,616
|
63,577
|
Accrued
expenses and other current liabilities
|
|
|
|
(including
accrued expenses and other current liabilities of
|
|
|
|
the
consolidated variable interest entities without recourse
|
|
|
|
to AirMedia
Group Inc. $9,585 and $6,904 as of December 31,
|
|
|
|
2011 and
March 31, 2012, respectively)
|
|
8,883
|
11,276
|
Deferred
revenue (including deferred revenue of the
|
|
|
|
consolidated
variable interest entities without recourse to
|
|
|
|
AirMedia
Group Inc. $11,516 and $11,736 as of December 31
|
|
|
|
2011 and
March 31, 2012, respectively)
|
|
11,809
|
11,522
|
Income tax
payable (including income tax payable of the
|
|
|
|
consolidated
variable interest entities without recourse to
|
|
|
|
AirMedia
Group Inc. $332 and $364 as of December 31,
|
|
|
|
2011 and
March 31, 2012, respectively)
|
|
680
|
792
|
Amounts
due to related parties (including amounts due to
|
|
|
|
related
parties of the consolidated variable interest entities
|
|
|
|
without
recourse to AirMedia Group Inc. $443 and $442 as
|
|
|
|
of December
31, 2011 and March 31, 2012, respectively)
|
|
442
|
443
|
Total
current liabilities
|
|
92,430
|
87,610
|
Deferred
tax liability - non-current
|
|
3,565
|
3,800
|
Total
liabilities
|
|
95,995
|
91,410
|
Equity
|
|
|
|
Ordinary
shares
|
|
128
|
128
|
Additional
paid-in capital
|
|
276,251
|
275,150
|
Treasury
stock
|
|
(3,775)
|
(3,775)
|
Statutory
reserves
|
|
8,049
|
8,049
|
Accumulated deficits
|
|
(45,465)
|
(38,138)
|
Accumulated other comprehensive income
|
|
30,582
|
30,734
|
Total
AirMedia Group Inc.'s shareholders' equity
|
|
265,770
|
272,148
|
Noncontrolling interests
|
|
(2,389)
|
(2,090)
|
Total
equity
|
|
263,381
|
270,058
|
Total
liabilities and
equity
|
|
359,376
|
361,468
|
|
|
|
|
|
|
|
AirMedia Group Inc.
|
|
|
|
|
|
|
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS
|
|
|
|
|
|
|
(In
U.S. dollars in thousands, except share and ADS related
data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months Ended
|
|
|
|
|
March
31,
2012
|
December 31,
2011
|
March
31,
2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
67,544
|
87,830
|
61,353
|
|
|
Business
tax and other sales tax
|
|
(1,400)
|
(2,836)
|
(1,452)
|
|
|
Net
revenues
|
|
66,144
|
84,994
|
59,901
|
|
|
Cost of
revenues
|
|
62,823
|
65,764
|
56,195
|
|
|
Gross
profit
|
|
3,321
|
19,230
|
3,706
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
Selling and
marketing *
|
|
4,083
|
4,984
|
4,289
|
|
|
General and
administrative *
|
|
6,128
|
7,245
|
4,854
|
|
|
Impairment of
goodwill
|
|
-
|
1,003
|
-
|
|
|
Total
operating expenses
|
|
10,211
|
13,232
|
9,143
|
|
|
(Loss)/income from operations
|
|
(6,890)
|
5,998
|
(5,437)
|
|
|
Interest
income
|
|
259
|
247
|
355
|
|
|
Other
income, net
|
|
813
|
716
|
336
|
|
|
(Loss)/income before income taxes
|
|
(5,818)
|
6,961
|
(4,746)
|
|
|
Income tax
expenses
|
|
(1,913)
|
(2,446)
|
(522)
|
|
|
Net
(loss)/income before net income of equity method
investments
|
|
(7,731)
|
4,515
|
(5,268)
|
|
|
Net income
of equity method investments
|
|
103
|
70
|
58
|
|
|
Net
(loss)/income
|
|
(7,628)
|
4,585
|
(5,210)
|
|
|
Less: Net
loss attributable to noncontrolling interests
|
|
(301)
|
(44)
|
(1,308)
|
|
|
Net
(loss)/income attributable to AirMedia Group Inc.'s
shareholders
|
|
(7,327)
|
4,629
|
(3,902)
|
|
|
Net
(loss)/income attributable to AirMedia Group Inc.'s
shareholders per ordinary share
|
|
|
|
|
|
|
Basic
|
|
(0.06)
|
0.04
|
(0.03)
|
|
|
Diluted
|
|
(0.06)
|
0.04
|
(0.03)
|
|
|
Net
(loss)/income attributable to AirMedia Group Inc.'s
shareholders per ADS
|
|
|
|
|
|
|
Basic
|
|
(0.12)
|
0.07
|
(0.06)
|
|
|
Diluted
|
|
(0.12)
|
0.07
|
(0.06)
|
|
|
Weighted
average ordinary shares outstanding used in
computing net (loss)/income per ordinary share - basic
|
|
125,241,217
|
126,546,835
|
131,876,085
|
|
|
Weighted
average ordinary shares outstanding used in
computing net (loss)/income per ordinary share - diluted
|
|
125,241,217
|
127,711,965
|
131,876,085
|
|
|
*
Share-based compensation charges included are as follow:
|
|
|
|
|
|
|
Selling and
marketing
|
|
297
|
178
|
281
|
|
|
General and
administrative
|
|
695
|
404
|
428
|
|
|
|
|
|
|
AirMedia Group Inc.
|
|
|
|
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF
COMPREHENSIVE (LOSS) INCOME
|
|
|
|
(In
U.S. dollars in thousands, except share and ADS related
data)
|
|
|
|
|
|
|
|
|
Three
Months Ended
|
|
March
31,
2012
|
December 31,
2011
|
March
31,
2011
|
Net (loss)
income
|
(7,628)
|
4,585
|
(5,210)
|
Other
comprehensive (loss) income
|
(151)
|
3,474
|
2,050
|
Comprehensive (loss) income
|
(7,779)
|
8,059
|
(3,160)
|
Less:
comprehensive loss attributable to the
noncontrolling interest
|
(300)
|
(72)
|
(1,305)
|
Comprehensive (loss) income attributable to
AirMedia Group Inc.'s shareholders
|
(7,479)
|
8,131
|
(1,855)
|
|
|
|
|
|
AirMedia Group Inc.
|
|
|
|
|
|
|
RECONCILIATION OF GAAP NET (LOSS)/ INCOME AND EPS
TO NON-GAAP ADJUSTED NET (LOSS)/ INCOME AND EPS
|
|
|
|
|
|
|
(In
U.S. dollars in thousands, except share and ADS related
data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months Ended
|
|
|
|
|
March
31,
2012
|
December 31,
2011
|
March
31,
2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
(loss)/ income attributable to AirMedia
Group Inc.'s shareholders (GAAP)
|
|
(7,327)
|
4,629
|
(3,902)
|
|
|
Amortization of acquired intangible assets
|
|
905
|
952
|
939
|
|
|
Share-based compensation
|
|
992
|
582
|
709
|
|
|
Impairment
of goodwill
|
|
-
|
1,003
|
-
|
|
|
Adjusted net (loss)/ income attributable to
AirMedia Group Inc.'s shareholders (non-GAAP)
|
|
(5,430)
|
7,166
|
(2,254)
|
|
|
|
|
|
|
|
|
|
Adjusted net (loss)/ income attributable to
AirMedia Group Inc.'s shareholders per
share (non-GAAP)
|
|
|
|
|
|
|
Basic
|
|
(0.04)
|
0.06
|
(0.02)
|
|
|
Diluted
|
|
(0.04)
|
0.06
|
(0.02)
|
|
|
|
|
|
|
|
|
|
Adjusted net (loss)/ income attributable to
AirMedia Group Inc.'s shareholders per ADS
(non-GAAP)
|
|
|
|
|
|
|
Basic
|
|
(0.09)
|
0.11
|
(0.03)
|
|
|
Diluted
|
|
(0.09)
|
0.11
|
(0.03)
|
|
|
|
|
|
|
|
|
|
Shares
used in computing adjusted basic net
(loss)/ income attributable to AirMedia Group
Inc.'s shareholders per share (non-GAAP)
|
|
125,241,217
|
126,546,835
|
131,876,085
|
|
|
Shares
used in computing adjusted diluted net
(loss)/ income attributable to AirMedia Group
Inc.'s shareholders per share (non-GAAP)
|
|
125,241,217
|
127,711,965
|
131,876,085
|
|
Note: 1)
The Non-GAAP adjusted net (loss) income per share and per ADS are
computed using Non-GAAP adjusted net (loss) income and number of
shares and ADSs used in GAAP basic and diluted EPS calculation,
where the number of shares and ADSs is adjusted for dilution due to
the share-based compensation plan.
|
|
AirMedia Group Inc.
|
|
|
|
|
|
|
RECONCILIATION OF GAAP OPERATING EXPENSES TO
NON-GAAP ADJUSTED OPERATING EXPENSES
|
|
|
|
|
|
|
(In
U.S. dollars in thousands, except for percentages)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months Ended
|
|
|
|
|
March 31,
2012
|
December 31,
2011
|
March 31,
2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses (GAAP)
|
|
10,211
|
13,232
|
9,143
|
|
|
Amortization of acquired intangible assets
|
|
905
|
952
|
939
|
|
|
Share-based compensation
|
|
992
|
582
|
709
|
|
|
Impairment
of goodwill
|
|
-
|
1,003
|
-
|
|
|
|
|
|
|
|
|
|
Adjusted operating expenses
(non-GAAP)
|
|
8,314
|
10,695
|
7,495
|
|
|
|
|
|
|
|
|
|
Adjusted operating expenses as a percentage of net
revenues (non-GAAP)
|
|
12.6%
|
12.6%
|
12.5%
|
|
|
AirMedia Group Inc.
|
|
|
|
|
|
|
RECONCILIATION OF GAAP (LOSS)/ INCOME FROM
OPERATIONS TO NON-GAAP ADJUSTED (LOSS)/ INCOME FROM
OPERATIONS
|
|
|
|
|
|
|
(In
U.S. dollars in thousands, except for percentages)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months Ended
|
|
|
|
|
March 31,
2012
|
December 31,
2011
|
March 31,
2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss)/
Income from operations
|
|
(6,890)
|
5,998
|
(5,437)
|
|
|
Amortization of acquired intangible assets
|
|
905
|
952
|
939
|
|
|
Share-based compensation
|
|
992
|
582
|
709
|
|
|
Impairment
of goodwill
|
|
-
|
1,003
|
-
|
|
|
|
|
|
|
|
|
|
Adjusted (loss)/ income from operations
(non-GAAP)
|
|
(4,993)
|
8,535
|
(3,789)
|
|
|
|
|
|
|
|
|
|
Adjusted operating margin
(non-GAAP)
|
|
-7.5%
|
10.0%
|
-6.3%
|
|
SOURCE AirMedia Group Inc.