Third Quarter Revenue Increased by 149.6% and Net Income Increased by 72.6% Year-over-year
SHANGHAI, China, Nov. 20 /Xinhua-PRNewswire/ -- Focus Media Holding Limited (Nasdaq: FMCN), China’s largest digital media group, today announced its unaudited financial results for the third quarter ended September 30, 2007.
Highlights for third Quarter 2007:
-- Total revenues grew 149.6% year-over-year and 33.6% quarter-over-
quarter to $151.4 million.
-- Net income for the third quarter was $46.6 million, up 72.6% year-over-
year and 23.6% quarter-over-quarter. Fully diluted net income per ADS
for the third quarter of 2007 was $0.37. Focus Media also provides
operating margin, net income and earnings per ADS on a non-GAAP basis
that exclude non-cash share-based compensation expense and acquired
intangible assets amortization expense to enable investors to better
assess the Company’s operating performance. The non-GAAP measures are
described below and reconciled to the corresponding GAAP measure in the
section below titled “Use of non-GAAP Financial Measures”. Net
income, excluding non-cash share-based compensation expenses and
amortization of acquired intangible assets resulting from acquisitions
(non-GAAP) for the third quarter was $54.6 million or $0.43 per fully
diluted ADS.
-- In the third quarter of 2007, digital out-of-home advertising revenue
was $94.7 million, up 23.3% quarter-over-quarter.
-- Advertising service revenue from our commercial location network,
including revenue from our LCD display networks, outdoor digital and
non-digital billboard networks (also referred to as our iStreet
Network) and movie theater advertising network, grew 67.7% year-
over-year and 26.5% quarter-over quarter to $64.6 million.
-- Advertising service revenue from our in-store network was $7.1
million, down 2.1% year-over-year and 2.2% quarter-over-quarter, due
to the relatively more competitive environment in our in-store
business.
-- Advertising service revenue from our in-elevator poster frame
network grew 104.4% year-over-year and 24.3% quarter-over-quarter to
$23.1 million.
-- Mobile handset advertising revenue grew 298.9% year-over-year and 28.9%
quarter-over-quarter, to $14.0 million in the third quarter 2007.
-- Internet advertising revenue was $42.5 million in the third quarter of
2007, up 68.5% quarter-over-quarter.
“We have achieved another record quarterly revenue and profit in the third quarter 2007. During the quarter, we saw robust advertising demand for our digital media offerings. Our Internet advertising business grew strongly in the quarter after several small acquisitions to strengthen the market leadership of Allyes. Although the gross margin of our Internet advertising business was lower than the previous quarter due to the consolidation of newly acquired entities, we believe the gross margin of our Internet business will trend up in the future as we leverage Allyes’ strong technology platform to improve the operations of these acquired businesses. We are well positioned to capitalize on the expected strong demand growth in the China advertising market in 2008,” said Jason Jiang, CEO of Focus Media. “In addition, our mobile handset advertising business continues to demonstrate strong growth potential. We believe its highly targeted ad delivery to mobile users based on demographic or location-based information is increasingly gaining acceptance by advertisers. In order to maximize shareholder value, we are evaluating a potential option for a separate listing of our mobile handset advertising business in Hong Kong or the United States.”
Third Quarter Financial Results
For the third quarter of 2007, Focus Media reported total revenues of $151.4 million, an increase of 149.6% compared to $60.6 million for the third quarter of 2006, and an increase of 33.6% compared to $113.3 million for the second quarter of 2007.
Our total digital out-of-home advertising revenue was $94.7 million in the third quarter of 2007, an increase of 66.1% from $57.0 million in the third quarter of 2006 and a sequential increase of 23.3% from $76.9 million in the second quarter of 2007. In the third quarter of 2007, commercial location advertising revenue was $64.6 million, contributing 68.2% of total digital out-of-home advertising revenue. Advertising service revenue from our in-store network was $7.1 million, or 7.5% of total digital out-of-home advertising revenue. Advertising service revenue from our in-elevator poster frame network placed primarily in the elevators of residential complexes was $23.1 million in the third quarter of 2007, or 24.3% of total digital out-of-home advertising revenue.
As of September 30, 2007, the total installed base of LCD displays in our commercial location network was 95,398 nationwide, including 90,375 displays through our directly owned networks, and 5,023 displays through our regional distributors. In the third quarter of 2007, we continued to expand the installed base of our hypermarkets to 1,266 stores as of September 30, 2007 from 1,205 hypermarkets as of June 30, 2007. Our in-store network also covers 695 supermarkets and 2,080 convenience stores as of September 30, 2007. The number of displays installed in our in-store network increased to 43,315 as of September 30, 2007 compared to 41,322 as of June 30, 2007. The total number of non-digital frames available for sale on our poster frame network was 163,455 as of September 30, 2007. In addition, as of September 30, 2007, we had installed 7,150 digital 2.0 frames, mainly in Beijing, Shanghai, Guangzhou and Shenzhen.
Mobile Advertising Business
Advertising service revenue from Focus Media Wireless in the third quarter of 2007 was $14.0 million, up 298.9% from $3.5 million in the third quarter of 2006 and 28.9% from $10.9 million in the second quarter of 2007.
Internet Advertising Business
Internet advertising service revenue was $42.5 million in the third quarter of 2007, up 68.5% from $25.2 million in the second quarter of 2007. Digital marketing service accounted for 94.0% of the total Internet advertising revenue. Rich Media, pay-for-performance and technology solutions accounted for the remaining 6.0%.
Gross profit for the third quarter of 2007 was $77.1 million, representing an increase of 99.9% compared to $38.6 million for the corresponding period a year ago and a 24.7% increase compared to $61.8 million in the second quarter 2007. In the third quarter 2007, gross margin for our digital out-of-home business was 62.7%. Within our digital out-of-home advertising networks, commercial location network gross margin was 64.7%, in-store network gross margin was 17.7%, and the in-elevator poster frame network gross margin was 71.1%. Commercial location gross margin was impacted by the acquisition of a leading outdoor billboard operator in China, which operates over 200 highly attractive outdoor billboard locations in major commercial centers in China. Excluding the non-digital outdoor billboard business we acquired in the second quarter of 2007, commercial location gross margin would have been 74.6%. We plan to upgrade some of these sites to digital LED billboards upon expiration of the current contracts with advertisers. The acquisition provides Focus Media with a stronger strategic position for the growth of outdoor digital billboard business in the future. The gross margin for our mobile advertising business was 56.2% in the third quarter of 2007. The gross margin for our Internet advertising business was 23.0% in the third quarter 2007, lower than the previous quarter due to several small acquisitions to strengthen the market leadership of Allyes. Blended gross margin for the company for the third quarter was 50.9%, as compared to 54.6% in the second quarter of 2007, primarily due to the contribution of the lower-margin Internet advertising business and in-store business.
In the third quarter of 2007, operating expenses totaled $30.0 million, including $1.1 million in acquired intangible asset amortization resulting from acquisitions and non-cash share-based compensation expense of $4.4 million. Operating expenses as a percentage of total revenues in the third quarter 2007 was 19.8%, as compared to 20.9% in the previous quarter. Selling and marketing expenses in the third quarter totaled $19.1 million including $2.4 million in share compensation expense, or 12.6% of total revenues. General and administrative expense in the third quarter was $12.1 million including $2.0 million in share-based compensation expense, or 8.0% of total revenues. Our operating margin in the third quarter of 2007 was 31.1%, as compared to 33.7% in the second quarter 2007. Excluding non-cash share-based compensation expense and acquired intangible asset amortization expense, operating margin (non-GAAP) was 36.4% in the third quarter 2007. Operating expenses in the third quarter of 2007 also include a one-time expense of approximately $2.1 million relating to the recent Audit Committee inquiry.
Net income for the third quarter of 2007 was $46.6 million, an increase of 72.6% compared to $27.0 million for the same period in 2006, and 23.6% compared to $37.7 million for the second quarter of 2007. Fully diluted net income per ADS for the third quarter of 2007 was $0.37. Net income excluding non-cash share-based compensation expense and acquired intangible assets amortization expense resulting from acquisitions (non-GAAP) in the third quarter of 2007 was $54.6 million, or $0.43 per fully diluted ADS.
Other Recent Developments
In November 2007, Focus Media and certain of its shareholders, consisting mainly of the former shareholders of Framedia, Dotad and Allyes, completed a secondary offering. In this offering, Focus Media sold 5,000,000 ADSs of newly issued shares and various selling shareholders sold 8,720,873 ADSs to the public.
On September 28, 2007, Mr. David Ying Zhang was appointed to Focus Media’s board of directors as an independent director. Mr. Zhang is the managing director and head of the Beijing office of WI Harper, a private equity fund. With the appointment of Mr. Zhang, Focus Media’s board regained a majority of independent directors.
BUSINESS OUTLOOK
The Company estimates its total revenues for the forth quarter of 2007 will range from $160 million to $170 million. Fourth quarter 2007 net income excluding share-based compensation expense and intangible assets amortization expense resulting from acquisitions (non-GAAP) is expected to be between $62 million and $64 million or $0.48 to $0.50 per fully diluted ADS based on 129 million total ADS-equivalent average shares outstanding.
USE OF NON-GAAP FINANCIAL MEASURES
In addition to Focus Media’s consolidated financial results under GAAP, the Company also provides non-GAAP financial measures, including non-GAAP operating margin, non-GAAP net income and non-GAAP earnings per fully diluted ADS, all excluding non-cash share-based compensation and acquired intangible asset amortization expense resulting from acquisitions. The Company believes that these non-GAAP financial measures provide investors with another method for assessing Focus Media’s operating results in a manner that is focused on the performance of its ongoing operations. Readers are cautioned not to view non-GAAP results on a stand-alone basis or as a substitute for results under GAAP, or as being comparable to results reported or forecasted by other companies, and should refer to the reconciliation of GAAP results with non-GAAP results in the attached financial information.
The Company believes that both management and investors benefit from referring to these non-GAAP financial measures in assessing the performance of Focus Media and when planning and forecasting future periods. The Company computes its non-GAAP financial measures using the same consistent method from quarter to quarter. The accompanying tables have more details on the GAAP financial measures that are most directly comparable to non-GAAP financial measures and the related reconciliation between these financial measures.
Focus Media Holding Ltd.
Reconciliation of GAAP to Non-GAAP
(U.S. Dollar in thousands, except share data)
(Unaudited)
Three months ended Nine months ended
2007-9-30 2006-9-30 2007-6-30 2007-9-30 2006-9-30
GAAP net
income
attributable
to
shareholders $46,613 $27,005 $37,715 $100,620 $53,109
Amortization
of acquired
intangible
assets 3,287 1,577 2,672 7,891 4,070
Share-based
compensation 4,679 1,569 4,919 14,115 4,932
Non-GAAP
net income $54,579 $30,151 $45,306 $122,626 $62,111
GAAP income
per ADS
- basic $0.38 $0.26 $0.33 $0.87 $0.54
GAAP income
per ADS
- diluted $0.37 $0.25 $0.32 $0.84 $0.52
Non-GAAP
income per
ADS - basic $0.45 $0.29 $0.39 $1.06 $0.63
Non-GAAP
income per
ADS - diluted $0.43 $0.28 $0.38 $1.03 $0.61
Shares
used in
calculating
basic
GAAP/
Non-GAAP
income
per ADS 122,250,042 105,113,194 115,701,382 115,883,549 98,232,890
Shares
used in
calculating
diluted
GAAP/
Non-GAAP
income
per ADS 126,370,818 109,293,170 119,385,064 119,471,360 102,375,332
GAAP
income
from
operations $47,122 $25,839 $38,164 $99,730 $51,970
Amortization
of acquired
intangible
assets 3,287 1,577 2,672 7,891 4,070
Share-based
compensation 4,679 1,569 4,919 14,115 4,932
Non-GAAP
income
from
operations $55,088 $28,985 $45,755 $121,736 $60,972
Non-GAAP
operating
margin 36.4 % 47.8 % 40.4 % 37.8 % 42.4 %
TODAY’S CONFERENCE CALL
Focus Media will host a conference call to discuss the third quarter 2007 financial results and forth quarter 2007 business outlook at 8:00 p.m. U.S. Eastern Time on November 19, 2007 (5:00 p.m. U.S. Pacific Time on November 19, 2007; 9:00 a.m. Beijing/Hong Kong time on November 20, 2007). The dial-in details for the live conference call are: U.S. Toll Free Number +1-800-884-5695, Hong Kong dial-in number +852-3002-1672, International dial-in number +1-617-786-2960; Pass code 26895957.
A replay of the call will be available from November 19, 2007 until November 26, 2007 (US Eastern Time). The dial-in details for the replay are: U.S. Toll Free Number +1-888-286-8010; international dial-in number +1-617-801-6888; pass code 78870211. A webcast of this call will also be available live and archived on Focus Media’s website at http://ir.focusmedia.cn .
ABOUT FOCUS MEDIA HOLDING LIMITED
Focus Media Holding Limited (Nasdaq: FMCN) is China’s leading multi- platform digital media company, operating the largest out-of-home advertising network in China using audiovisual digital displays, based on the number of locations and number of flat-panel television displays in our network, and is also a leading provider of mobile handset advertising and Internet marketing solutions in China. Through Focus Media’s multi-platform digital advertising network, the company reaches urban consumers at strategic locations and point-of-interests over a number of media formats, including audiovisual television displays in buildings and stores, advertising poster frames and other new and innovative media, such as outdoor light-emitting diode or LED digital billboard, mobile handset advertising networks and Internet advertising platforms. As of September 30, 2007, Focus Media’s digital out-of-home advertising network had approximately 95,398 LCD display in its commercial location network, approximately 43,315 LCD displays in its in-store network and 170,605 advertising in-elevator poster frames, installed in over 90 cities throughout China, and approximately 200 outdoor LED billboard displays in Shanghai. For more information about Focus Media, please visit our website at http://ir.focusmedia.cn .
SAFE HARBOR: FORWARD-LOOKING STATEMENTS
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 section and quotations from management in this press release, as well as Focus Media’s strategic and operational plans, contain forward-looking statements. Focus Media may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission 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 Focus Media’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, risks outlined in Focus Media’s filings with the U.S. Securities and Exchange Commission, including its registration statements on Form F-1, F-3, F-6 and 20-F, in each case as amended. Focus Media does not undertake any obligation to update any forward-looking statement, except as required under applicable law.
Focus Media Holding Limited
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(U.S. Dollars in thousands)
2007-9-30 2006-12-31
ASSETS
Current assets
Cash and cash equivalents $190,243 $164,611
Investment in equity securities 51,961 --
Accounts receivables, net 169,800 61,614
Inventories 2,449 519
Prepaid expenses and other current
assets 20,109 5,199
Deposit paid for acquisition of
subsidiaries 43,423 3,526
Amount due from related parties 4,240 7,853
Rental deposits 31,333 --
Total current assets $513,558 $243,322
Rental Deposits 3,290 11,833
Equipment, net 83,617 70,250
Acquired intangible assets, net 74,219 34,717
Goodwill 928,450 739,744
Other long term assets 35,430 6,376
Total assets $1,638,564 $1,106,242
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Short term debt $-- $2,769
Accounts payable 48,344 5,987
Accrued expenses and other current
liabilities 95,261 38,674
Income taxes payable 12,560 4,060
Amount due to related parties 7,948 347
Deferred tax liabilities 1,125 --
Total current liabilities $165,238 $51,837
Deferred tax liabilities 6,218 3,303
Total liabilities $171,456 $55,140
Minority interests 496 358
Shareholders’ equity
Ordinary shares 31 27
Additional paid in capital 1,247,971 709,196
Acquisition consideration to be --
issued 237,879
Retained earnings 195,347 96,195
Accumulated other comprehensive
income 23,263 7,447
Total shareholders’ equity $1,466,612 $1,050,744
Total liabilities and shareholders’
equity $1,638,564 $1,106,242
Focus Media Holding Limited
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(U.S. Dollar in thousands, except share data)
Three months ended Nine months ended
2007-9-30 2006-9-30 2007-6-30 2007-9-30 2006-9-30
(unaudited) (unaudited) (unaudited) (unaudited) (unaudited)
Gross
revenues
(note 3):
Digital
out-of-home
Commercial
locations $70,173 $42,581 $55,368 $160,459 $99,448
In-store
network 7,813 8,002 7,998 23,137 21,055
In-elevator
poster
frame
network 25,121 12,386 20,347 59,322 29,780
Mobile
handset
advertising 14,627 3,801 11,268 31,915 7,166
Internet
advertising 44,234 -- 26,418 70,652 --
Other
revenue 117 90 305 803 780
Total
gross
revenues 162,085 66,860 121,704 346,288 158,229
Less:
Sales
taxes 10,693 6,213 8,429 24,281 14,320
Total
revenues 151,392 60,647 113,275 322,007 143,909
Cost of
revenues
(note 4):
Digital
out-of-home
Commercial
locations 22,825 11,428 17,868 53,591 31,141
In-store
network 5,832 4,616 5,187 16,046 12,983
In-elevator
poster
frame
network 6,656 3,732 5,265 16,667 9,746
Mobile
handset
advertising 6,145 2,219 4,569 13,468 4,624
Internet
advertising 32,718 -- 18,405 51,123 --
Total
advertising
service
costs 74,176 21,995 51,294 150,895 58,494
Other
costs 121 80 138 424 392
Total cost
of revenues 74,297 22,075 51,432 151,319 58,886
Gross profit 77,095 38,572 61,843 170,688 85,023
Operating
expenses:
General
and
administrative
(note 4) 12,095 5,956 11,646 32,424 16,650
Selling
and
marketing
(note 4) 19,081 6,782 13,154 42,121 16,565
Other
operating
income (1,203) (5) (1,121) (3,587) (162)
Total
operating
expenses 29,973 12,733 23,679 70,958 33,053
Income
from
operations 47,122 25,839 38,164 99,730 51,970
Interest
income, net 1,595 1,070 1,870 6,158 2,563
Other
income
(expenses),
net 5 (176) 12 109 (655)
Income
before
tax and
minority
interests 48,722 26,733 40,046 105,997 53,878
Income
tax
expense
- Current 2,063 (134) 2,683 5,847 484
- Deferred 46 (183) (365) (452) 189
Total
income
taxes 2,109 (317) 2,318 5,395 673
Income
before
minority
interests 46,613 27,050 37,728 100,602 53,205
Minority
Interests -- 45 13 (18) 96
Net income $46,613 $27,005 $37,715 $100,620 $53,109
Income
per ADS
- basic $0.38 $0.26 $0.33 $0.87 $0.54
Income
per ADS
- diluted $0.37 $0.25 $0.32 $0.84 $0.52
Shares
used in
calculating
basic
income
per ADS 122,250,042 105,113,194 115,701,382 115,883,549 98,232,890
Shares
used in
calculating
diluted
income
per
ADS 126,370,818 109,293,170 119,385,064 119,471,360 102,375,332
Focus Media Holding Limited
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASHFLOWS
(U.S. Dollar in thousands)
Three months ended Nine months ended
2007-9-30 2006-9-30 2007-9-30 2006-9-30
Operating activities:
Net income $46,613 $27,005 $100,620 $53,109
Adjustments to
reconcile net
income to net cash
provided by
operating activities:
Minority interest -- 45 (18) 96
Bad debt provision 320 627 2,736 1,397
Share based
compensation 4,679 1,569 14,115 4,932
Depreciation and
amortization 5,114 3,714 13,222 9,844
Amortization of
acquired intangible
assets 3,287 1,577 7,891 4,070
Changes in assets and
liabilities,
net of effects of
acquisitions (19,174) (5,695) (41,157) (27,214)
Net cash provided by
operating
activities $40,839 $28,842 $97,409 $46,234
Investing activities:
Purchase of equipment
and other long
term assets (11,659) (1,696) (36,924) (13,304)
Acquisition of an
intangible asset -- -- (105) --
Purchase of
subsidiaries, net of
cash acquired 2,334 (35,768) (54,440) (122,827)
Deposits paid to
acquire
subsidiaries (25,004) (2,800) (60,272) (2,800)
Investment in
equity securities (8,830) -- (49,545) --
Net cash used in
investing activities $(43,159) $(40,264) $(201,286) $(138,931)
Financing activities:
Proceeds from issuance
of ordinary shares,
net of issuance costs 475 5,710 120,733 154,390
Proceeds from
short-term debts -- -- -- 24,598
Capital injection from
minority shareholders 40 -- 137 249
Repayment of short-term
debts (394) (23,351) (4,165) (29,402)
Net cash provided by
financing activities $121 $(17,641) $116,705 $149,835
Effect of exchange rate
changes 4,850 1,488 12,805 1,318
Net (decrease) increase
in cash and
cash equivalents $2,651 $(27,575) $25,633 $58,456
Cash and cash
equivalents, beginning
of period 187,592 122,684 164,610 36,653
Cash and cash
equivalents, end of
period $190,243 $95,109 $190,243 $95,109
Supplemental disclosure
of cash flow
information:
Income taxes paid $461 $12 $1,038 $30
Interest paid $6 $218 $6 $245
Supplemental disclosure of non-cash
investing activity:
Acquisition of subsidiaries:
Value of ordinary share
consideration $-- $-- $166,050 $365,660
Accounts payable $6,143 $277 $6,143 $277
Notes:
Note 1: Basic income per ADS is computed by dividing income attributable
to holders of ordinary shares by the weighted average number of
ADS outstanding during the year/period. Diluted income per ADS
reflects the potential dilution that could occur if securities or
other contracts to issue ADS were exercised or converted into ADS.
Note 2: The conversion of Renminbi (“RMB”) amounts into USD amounts is
based on the rate of USD1 = RMB7.5108 on September 28, 2007.
Note 3: Details of net revenues are as follows (U.S. Dollars in thousands):
Three months ended Nine months ended
2007-9-30 2006-9-30 2007-6-30 2007-9-30 2006-9-30
Gross
Advertising
Service
Revenue:
Digital
out-of-home:
Commercial
locations
- Unrelated
parties $70,091 $37,101 $55,321 $157,825 $87,586
- Related
parties 82 5,480 47 2,634 11,862
Total
Commercial
Locations 70,173 42,581 55,368 160,459 99,448
In-store
Network
- Unrelated
parties 7,813 6,610 7,998 21,822 17,617
- Related
parties -- 1,392 -- 1,315 3,438
Total
In-store
network 7,813 8,002 7,998 23,137 21,055
In-elevator
Poster Frame
Network
- Unrelated
parties 25,029 12,386 20,249 59,132 29,780
- Related
parties 92 -- 98 190 --
Total
In-elevator
Poster Frame
Network 25,121 12,386 20,347 59,322 29,780
Mobile
handset
advertising
- Unrelated
parties 14,592 3,801 11,179 31,791 7,166
- Related
parties 35 -- 89 124 --
Total mobile
handset
advertising 14,627 3,801 11,268 31,915 7,166
Internet
advertising
- Unrelated
parties 43,552 -- 26,088 69,640 --
- Related
parties 682 -- 330 1,012 --
Total
internet
advertising 44,234 -- 26,418 70,652 --
Gross
Advertising
Services
Revenue: 161,968 66,770 121,399 345,485 157,449
Less: Sales
taxes:
Digital
out-of-home:
Commercial
locations: 5,584 4,063 4,308 13,166 9,111
In-store
Network 726 763 754 2,168 1,984
In-elevator
Poster Frame
Network 2,058 1,102 1,799 5,042 2,651
Mobile
handset
advertising 602 285 386 1,000 574
Internet
advertising 1,723 -- 1,182 2,905 --
Total sales
taxes: 10,693 6,213 8,429 24,281 14,320
Net
Advertising
Service
Revenue 151,275 60,557 112,970 321,204 143,129
Add: Other
revenue: 117 90 305 803 780
Net revenues: $151,392 $60,647 $113,275 $322,007 $143,909
Note 4: Share based compensations included under SFAS 123R are as follows
(U.S. Dollars in thousands):
Three months ended Nine months ended
2007-9-30 2006-9-30 2007-6-30 2007-9-30 2006-9-30
Cost of
revenues $288 $-- $284 $853 $--
Selling and
marketing 2,374 211 2,084 6,519 889
General and
administrative 2,017 1,358 2,551 6,743 4,043
Sub-total $4,679 $1,569 $4,919 $14,115 $4,932
Note 5: The Company has performed preliminary purchase price allocation on
their acquisition made in the fourth quarters of 2006 and the
first three quarters of 2007 based on an internal valuation
performed by management. The purchase price allocation will be
finalized once the independent valuation analysis is completed.
Note 6: The earnings per ADS is based on the new conversion ratio of 1 ADS
to 5 ordinary shares, effective as of April 11, 2007. The
comparative numbers haven been adjusted to reflect the conversion.
Focus Media Holding Ltd.
Reconciliation of GAAP to Non-GAAP
(U.S. Dollar in thousands, except percentages, share and per-share data)
(Unaudited)
Three months ended Nine months ended
2007-9-30 2006-9-30 2007-6-30 2007-9-30 2006-9-30
GAAP net
income
attributable
to shareholders $46,613 $27,005 $37,715 $100,620 $53,109
Amortization
of acquired
intangible
assets 3,287 1,577 2,672 7,891 4,070
Share-based
compensation 4,679 1,569 4,919 14,115 4,932
Non-GAAP net
income $54,579 $30,151 $45,306 $122,626 $62,111
GAAP income
per ADS
- basic $0.38 $0.26 $0.33 $0.87 $0.54
GAAP income
per ADS
- diluted $0.37 $0.25 $0.32 $0.84 $0.52
Non-GAAP
income per
ADS - basic $0.45 $0.29 $0.39 $1.06 $0.63
Non-GAAP
income per
ADS - diluted $0.43 $0.28 $0.38 $1.03 $0.61
Shares used
in calculating
basic GAAP/
Non-GAAP
income per
ADS 122,250,042 105,113,194 115,701,382 115,883,549 98,232,890
Shares used
in calculating
diluted
GAAP/Non-GAAP
income per
ADS 126,370,818 109,293,170 119,385,064 119,471,360 102,375,332
GAAP income
from
operations $47,122 $25,839 $38,164 $99,730 $51,970
Amortization
of acquired
intangible
assets 3,287 1,577 2,672 7,891 4,070
Share-based
compensation 4,679 1,569 4,919 14,115 4,932
Non-GAAP
income from
operations $55,088 $28,985 $45,755 $121,736 $60,972
Non-GAAP
operating
margin 36.4 % 47.8 % 40.4 % 37.8 % 42.4 %
For more information, please contact:
Jie Chen
Tel: +86-21-3212-4661 x6607
Email: ir@focusmedia.cn