2012 Q1 Financial Summary
- Net revenues were
$9.1 million compared with$15.0 million for the first quarter of 2011; - Gross profit was
$7.1 million compared with$12.7 million for the first quarter of 2011; - Net loss attributable to
China Finance Online was$1.3 million ; - Excluding non-cash share-based compensation expenses, non-GAAP net loss attributable to
China Finance Online was$1.1 million .
Key Developments
- Stockstar.com ("Stockstar") entered into an exclusive partnership with Baidu.com ("
Baidu ") on a mobile web application to provide financial information services.
Mr.
"As we transition our business toward securities investment advisory services, we continue to leverage our leadership in financial information services, data solutions and web technologies, to expand our user base. Our flagship sites jrj.com and stockstar.com are two of the most established financial portal sites in
2012 First Quarter Results
Net revenues for the first quarter of 2012 were
For the first quarter of 2012, gross profit was
General and administrative ("G&A") expenses for the first quarter of 2012 were
Sales and marketing expenses for the first quarter of 2012 were
Product development expenses for the first quarter of 2012 were
Total operating expenses for the first quarter of 2012 were
GAAP net loss attributable to
As of
Total
The combined current and non-current deferred revenues at the end of the first quarter of 2012, which represented prepaid service fees made by customers for subscription services that have not been rendered as of
As of
Key Developments
On
Under the partnership, Stockstar and
The web application went live in
"Stockstar is one of the most established financial portal sites in
Strategic Operational Transition
As stated previously, assessing the profound secular changes taking place in both capital markets and our own industry, the Board of Directors decided upon the following strategic transition. Beginning in
In
Cost reduction associated with the transition will help offset the loss in revenues and mitigate the loss of cash flow to a certain extent. The Company plans to implement additional cost-cutting initiatives to increase efficiency and improve operational performance. Deferred revenues will continue to be realized until the expiration of outstanding premium individual subscriptions. The Company intends to preserve its cash balance as ample cash is critical for ensuring the success of the strategic transition.
Conference Call Information
The Company will host a conference call and a simultaneous webcast, on
A replay of the conference call will be available shortly after the conclusion of the event through
The conference call will be available as a live webcast and replay at: http://www.media-server.com/m/p/6itzpumo
About
Safe Harbor Statement
This press release contains forward-looking statements. These statements constitute "forward-looking" statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Among other things, this release contains the following forward-looking statements regarding:
- our product upgrade and strategic transformation initiative;
- cost-cutting initiative and its effect on efficiency and operational performance;
- potential business consolidation amidst the new regulatory environment;
- the market prospect of the business of securities investment advisory and wealth management;
- the new exclusive partnership between Stockstar and
Baidu ; and - the transition period to adapt to the new compliance requirements.
Such statements involve certain risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements, which risks and uncertainties include, among others, the following:
- the changing customer needs, regulatory environment and market condition that we are subject to;
- the uneven sector-growth of the Chinese economy that could lead to volatility in the equity markets and affect our operating results in the coming quarters;
- the unpredictability of our strategic transformation and upgrade;
- the competition we are facing in the new business of securities investment advisory and wealth management;
- global macroeconomic uncertainties;
- wavering investor confidence that could impact our business;
- the extent to which Stockstar's financial information services can be integrated into the mobile web application launched by Stockstar and
Baidu , and the continuity of the exclusive partnership; and - possible non-cash goodwill, intangible assets and investment impairment may adversely affect our net income.
Further information regarding these and other risks is included in the Company's filings with the
Non-GAAP Measures
To supplement the unaudited condensed consolidated financial information presented in accordance with Accounting Principles Generally Accepted in
Contact:
+86-10-5832-5288
ir@jrj.com
Grayling
646-284-9474
shiwei.yin@grayling.com
China Finance Online Co. Limited |
||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS |
||
(In thousands of U.S. dollars) |
||
Mar. 31, 2012 |
Dec. 31, 2011 |
|
Assets |
||
Current assets: |
||
Cash and cash equivalents |
50,493 |
64,641 |
Restricted cash |
29,432 |
29,861 |
Trust bank balances held on behalf of customers |
11,645 |
18,664 |
Accounts receivable, net - others |
2,821 |
1,468 |
Accounts receivable, net - Margin clients |
16,715 |
12,889 |
Loan receivable |
9,574 |
9,566 |
Short-term investments |
10,832 |
10,701 |
Prepaid expenses and other current assets |
3,623 |
3,577 |
Deferred tax assets, current |
503 |
634 |
Total current assets |
135,638 |
152,001 |
Property and equipment, net |
5,819 |
6,530 |
Acquired intangible assets, net |
2,749 |
- |
Rental deposits |
739 |
738 |
Deferred tax assets, non-current |
511 |
484 |
Other deposits |
223 |
224 |
Total assets |
145,679 |
159,977 |
Liabilities and equity |
||
Current liabilities: |
||
Deferred revenue, current (including deferred revenue, current of the |
14,037 |
17,287 |
Accrued expenses and other current liabilities (including accrued |
4,360 |
6,458 |
Short-term loan (including short-term loan of the consolidated variable |
18,545 |
19,171 |
Amount due to customers for trust bank balances held on behalf of |
11,645 |
18,664 |
Accounts payable (including accounts payable of the consolidated |
398 |
144 |
Deferred tax liability, current (including deferred tax liability, current of the |
4 |
45 |
Income taxes payable (including income taxes payable of the consolidated |
101 |
135 |
Total current liabilities |
49,090 |
61,904 |
Deferred revenue, non-current (including deferred revenue, non-current |
6,025 |
7,237 |
Deferred tax liability, non-current (including deferred tax liability, non-current |
688 |
- |
Total liabilities |
55,803 |
69,141 |
Noncontrolling interests |
(20) |
(105) |
Total China Finance Online Co. Limited Shareholders' equity |
89,896 |
90,941 |
Total liabilities and equity |
145,679 |
159,977 |
China Finance Online Co. Limited |
|||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME |
|||
(in thousands of U.S. dollars, except share and ADS related data) |
|||
Three months ended |
|||
Mar.31, 2012 |
Mar.31, 2011 |
Dec.31, 2011 |
|
Net revenues |
9,109 |
14,955 |
10,760 |
Cost of revenues |
(1,988) |
(2,237) |
(2,067) |
Gross profit |
7,121 |
12,718 |
8,693 |
Operating expenses |
|||
General and administrative(includes share-based compensation expenses of $174, $428 and $216, respectively) |
(2,766) |
(2,726) |
(2,747) |
Sales and marketing (includes share-based compensation expenses of $8, $44 and $11, respectively) |
(3,549) |
(5,598) |
(4,453) |
Product development (includes share-based compensation expenses of $3, $32 and $26, respectively) |
(3,205) |
(3,225) |
(3,416) |
Loss from impairment of intangible assets |
- |
- |
(3,437) |
Loss from impairment of goodwill |
- |
- |
(11,796) |
Total operating expenses |
(9,520) |
(11,549) |
(25,849) |
Government subsidies |
19 |
113 |
14 |
Income (loss) from operations |
(2,380) |
1,282 |
(17,142) |
Interest income |
1,088 |
706 |
740 |
Interest expense |
(124) |
(54) |
(58) |
Investment gain |
178 |
773 |
178 |
Other income (loss), net |
79 |
2 |
(76) |
Exchange gain, net |
25 |
268 |
246 |
Income (loss) before income tax benefit (expenses) |
(1,134) |
2,977 |
(16,112) |
Income tax benefit (expenses) |
(56) |
(1,437) |
708 |
Net income (loss) |
(1,190) |
1,540 |
(15,404) |
Less: Net income attributable to the non-controlling interest |
63 |
147 |
2 |
Net Income (loss) attributable to China Finance Online Co. Limited |
(1,253) |
1,393 |
(15,406) |
Net income(loss) |
(1,190) |
1,540 |
(15,404) |
Changes in foreign currency translation adjustment |
60 |
604 |
408 |
Net unrealized (loss) on available-for-sale securities, net of tax effects of ($3), nil and ($6), respectively |
(15) |
- |
(32) |
Other comprehensive income, net of tax |
45 |
604 |
376 |
Comprehensive income (loss) |
(1,145) |
2,144 |
(15,028) |
Less: comprehensive income attributable to non-controlling interest |
63 |
147 |
2 |
Comprehensive income (loss) attributable to China Finance Online Co. Limited |
(1,208) |
1,997 |
(15,030) |
Net income (loss)per share attributable to China Finance Online Co. Limited |
|||
Basic |
(0.01) |
0.01 |
(0.14) |
Diluted |
(0.01) |
0.01 |
(0.14) |
Income (loss) per ADS |
|||
Basic |
(0.06) |
0.06 |
(0.71) |
Diluted |
(0.06) |
0.06 |
(0.71) |
Weighted average ordinary shares |
|||
Basic |
108,982,101 |
108,945,295 |
108,976,122 |
Diluted |
108,982,101 |
113,684,068 |
108,976,122 |
Weighted average ADSs |
|||
Basic |
21,796,420 |
21,789,059 |
21,795,224 |
Diluted |
21,796,420 |
22,736,814 |
21,795,224 |
Non-GAAP Measures(in thousands of U.S. dollars, except ADS related data) |
|||
Three months ended |
|||
Mar.31, 2012 |
Mar.31, 2011 |
Dec.31, 2011 |
|
Income (loss) from operations (GAAP) |
(2,380) |
1,282 |
(17,142) |
Share-based compensation |
185 |
504 |
253 |
Loss from impairment of intangible assets |
- |
- |
3,437 |
Loss from impairment of goodwill |
- |
- |
11,796 |
Adjusted income (loss) from operations (Non-GAAP) |
(2,195) |
1,786 |
(1,656) |
Three months ended |
|||
Mar.31, 2012 |
Mar.31, 2011 |
Dec.31, 2011 |
|
Net income (loss) attributable to China Finance Online Co. Limited (GAAP) |
(1,253) |
1,393 |
(15,406) |
Share-based compensation |
185 |
504 |
253 |
Loss from impairment of intangible assets |
- |
- |
3,437 |
Loss from impairment of goodwill |
- |
- |
11,796 |
Adjusted net income (loss) attributable to China Finance Online Co. Limited (Non-GAAP) |
(1,068) |
1,897 |
80 |
Diluted adjusted net income (loss) per ADS attributable to China Finance Online Co. Limited (Non-GAAP) |
(0.05) |
0.08 |
0.00 |
ADSs used in calculating diluted adjusted net income (loss) attributable to China Finance Online Co. Limited (Non-GAAP) |
21,796,420 |
22,736,814 |
22,494,305 |
SOURCE