- Returned to Profitability and Advertising Revenue of Travel Channel increased over 30%
Highlights:
HONG KONG, Aug. 16 /PRNewswire-Asia/ -- Media China Corporation Limited (“Media China” or the “Group”) (Stock Code: 00419.HK), a leading media group, satellite channel operator and entertainment content provider in China, today announced its consolidated interim results for the six months ended 30 June 2010.
As the Group adjusted and optimized its business structure in response to market conditions, it returned to profitability and achieved a profit attributable to equity holders of the Company of HK$9,668,000. This was a significant improvement as compared to a loss attributable to equity holders of the Company of HK$74,892,000 in the prior period. Also, the gross profit surged over four times to HK$15,620,000. A key driver for this was the Group’s new joint venture with Hainan Television Broadcasting Station (“Hainan TV”) to operate as the advertising agent for the Travel Channel. The Group and Hainan TV’s business development have been tied together through their common interest in the Travel Channel. The Group recorded approximately 50% of the relative revenue and cost according to the proportionate consolidation accounting method, which led to a decrease of 34% in its sales revenue to HK$72,585,000. In fact, advertising revenue of the Travel Channel increased over 30% during the review period.
Mr. Edward Tian Suning, Chairman of Media China, commented, “China’s media and advertising markets recovered at a healthy pace with China’s economy, leading to a strong rebound in the market after the financial crisis. Meanwhile, the government launched a series of policies to support the cultural industries to promote the development of China's cultural industries. We adjusted and optimized our business structure in response to market conditions and formed a new joint venture with Hainan TV to operate as the advertising agent for the Travel Channel in the period under review. The effect was gradually reflected in the Group’s positive segment results.”
The television advertising segment remained the biggest revenue contributor of the Group. It includes the provision of media resources procurement services to international advertising agencies and direct customers, as well as to be the exclusive advertising agency for the Travel Channel through a joint venture with Hainan TV. Its revenue totaled HK$71,344,000 and segment profit was HK$15,954,000.
The Travel Channel is one of the main contributors of the television advertising segment. Year to date, the dollar amount of advertising contracts signed by the Travel Channel has already surpassed that signed in 2009. In addition, the Travel Channel actively strengthened its cooperation with local governments and tourism administrations. Currently partnering provinces and cities included Beijing, Guangdong and Shanxi. The Group also strived to expand cooperation to speed up its business development.
The Group will continue to develop the media resources procurement services and extensive relationships with international advertising agencies. The Group helps the agencies to procure media resources from local TV stations in China and offer them one-stop solutions ranging from planning, broadcasting and monitoring of advertising to payment logistics.
In the content production segment, the Group received an enthusiastic response in the market for its film “Bodyguards and Assassins”, a blockbuster that was honored the "Best Picture" of the 29th Hong Kong Film Awards. The Group has continued to invest in the production of several TV dramas and films including, “Snow Flower and the Secret Fan” starring Jun Ji-hyun and Li Bingbing and “The Love of the Hawthorn Tree” directed by Zhang Yi-mou. In the first half of 2010, the Group invested more than HK$50 million in the content production business.
Looking ahead into the second half, media and advertising markets in China will continue to grow steadily. The Chinese government energetically promoted the development of tourism and has approved the strategic plan for the development of Hainan province as “Hainan International Tourism Island”. The Travel Channel, with its base in Hainan province, will definitely benefit. The Group expects the advertising revenue from the Travel Channel to maintain its momentum from that in the first half of 2010.
In addition, the policy of promoting the convergence of telecommunications, broadcasting and Internet networks in China will create ample opportunities for new media. Cross-media cooperation will further increase, driving demand of media content in the market. Meanwhile, the Group’s content production business will benefit from ample opportunities created by the surge in demand. Lastly, television advertising business will benefit from the rising popularity of cross-media platforms and will ultimately enhance the Group’s advertising sales.
About Media China Corporation Limited
Media China Corporation Limited (Stock Code: 00419.HK) is a leading media group, satellite channel operator and entertainment content provider in China. As a media company with one of the largest libraries of films, TV comedies and dramas, Media China is engaged in various media related businesses in China, including consolidation and sale of advertising resources, and the production of television programmes, advertisements, television dramas and movies. For more details, please refer to its website: http://www.mediachina-corp.com .
Investor and Media Enquiries:
Media China Corporation Limited
Raymond Hau
Tel: +852 2877 8412
Email: raymondhau@mediachina-corp.com
PRChina Limited
Henry Chik
Tel: +852 2522 1368
Email: hchik@prchina.com.hk
David Shiu
Tel: +852 2522 1838
Email: dshiu@prchina.com.hk
Ada Tsang
Tel: +852 2521 2823
Email: atsang@prchina.com.hk
