Airmedia Group (NASDAQ:AMCN)

First Quarter 2012 Results

• 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.

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.

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.

Fourth Quarter 2011 Financial and Business Highlights

• Total revenues increased by 24.1% year-over-year and by 25.3% quarter-over-quarter to US$87.8 million, beating the high end of the Company's already raised guidance by US$1.8 million.
• Revenues from the gas station media network increased by 281.5% year-over-year and by 58.5% quarter-over-quarter to US$5.9 million.
• Net income attributable to AirMedia's shareholders was US$4.6 million. Basic and diluted net income attributable to AirMedia's shareholders per American Depositary Share ("ADS") were both US$0.07.
• Adjusted net income attributable to AirMedia's shareholders (non-GAAP), which is net income 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$7.2 million. Adjusted basic and diluted net income attributable to AirMedia's shareholders per ADS (non-GAAP) were both US$0.11.

"AirMedia has demonstrated strong resilience to significant adverse market events. We emerged stronger and more competitive after overcoming each challenge. Our solid quarterly earnings are, again, a validation of the leverage business model that we have been building. With a leading market position in the air travel advertising sector, AirMedia has become the right choice for airports in China. The recent renewals of some major contracts reflect the value and synergy of our nationwide advertising network," commented Herman Guo, chairman and chief executive officer of AirMedia.

"In 2012, we will focus on further demonstrating the earnings power of our business model. More importantly, we will lay out the foundation for future growth. One initiative is to expand the nationwide coverage of our mega-size LEDs with strong financial discipline. There are high levels of demand for our mega-size LEDs and we have significant pricing power in most locations. We have recently obtained concession rights to operate mega-size LEDs in the Chengdu and Xi'an airports. We will carefully try to replicate our success from our existing locations to these new locations," Mr. Guo added.

"We are pleased to have delivered strong revenue growth and record quarterly income from operations in the past three years in the fourth quarter of 2011. It sets us on a good track toward achieving profitable growth in 2012. Our revenue growth expectation is built on our strong market position and the continuous expansion of our customer base. With the recent renewals of major concession rights contracts, we believe that the vast majority of our concession fees are under control for the next three years," Ping Sun, AirMedia's chief financial officer, commented.

Business Outlook

AirMedia currently expects its total revenues for the first quarter of 2012 to range from US$66.0 million to US$68.0 million, representing a year-over-year increase of 7.6% to 10.8% from the same period in 2011. AirMedia currently expects its concession fees to be approximately US$43.0 million in the first quarter of 2012. The quarter-over-quarter increase from the fourth quarter of 2011 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.

Second Quarter 2011 Financial and Business Highlights

• Total revenues increased by 3.9% year-over-year to US$58.5 million.
  
• Net loss attributable to AirMedia's shareholders was US$8.6 million, which included a non-cash loss on the disposal of certain fixed assets of US$4.2 million and an impairment of intangible asset of US$656,000. Basic and diluted net loss attributable to AirMedia's shareholders per American Depositary Share ("ADS") were both US$0.13.
  
• 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, and impairment of intangible assets, was US$6.1 million.
  
• Basic adjusted net loss attributable to AirMedia's shareholders per ADS (non-GAAP) for the second quarter of 2011 was US$0.09, compared to basic adjusted net loss attributable to AirMedia's shareholders per ADS (non-GAAP) of US$0.01 in the same period one year ago

• The Company continued generating positive operating cash flow in excess of capital expenditures in the second quarter of 2011. Other than restricted cash of US$6.1 million, cash increased to US$114.5 million as of June 30, 2011, from US$106.5 million as of December 31, 2010.
  
• AirMedia started to put advertisements on the interior and exterior of the gate bridges at Terminal 3 of the Beijing Capital International Airport on May 7, 2011 and June 13, 2011, respectively. These advertisements on the gate bridges at Terminal 3 of the Beijing Airport generated revenues of US$2.2 million in the second quarter of 2011.

"Our business was heavily impacted in the second quarter due to the fact that the automobile industry was one of our top advertising industries. The Japanese earthquake negatively affected the supply chains of automobile manufacturers, and as a result, many of them reduced their advertising orders in the second quarter of 2011, especially those for new car model releases. However, we are happy to see a strong comeback from automobile industry in the third quarter with sizable advertising orders, including orders from Japanese automobile manufacturers. We expect to see advertising orders from automobile industry continue to more fully recover in the fourth quarter of this year," commented Herman Guo, chairman and chief executive officer of AirMedia. "At the same time, we are also making progress in diversifying our revenue sources.

"We are also pleased with having resolved issues of delay with gate bridge advertisements at Terminal 3 of the Beijing airport. For the third quarter of 2011, we will have advertising revenues from the Terminal 3 gate bridges for a full quarter that we expect to be sufficient to cover the corresponding quarterly concession fees," added Mr. Guo

"We are disappointed at the second quarter revenue results. The impact from the automobile industry was more severe than what we had anticipated. However, I would like to point out that our net loss in the second quarter included non-cash charges of US$4.9 million from the disposal of certain fixed assets and the impairment of intangible asset. With the recovery of automobile-related advertising and the Terminal 3 gate bridges fully contributing to our revenues, we expect to see improvements in our bottom line results in the third quarter of 2011," Ping Sun, AirMedia's chief financial officer, commented.

Business Outlook

AirMedia currently expects that its total revenues for the third quarter of 2011 will range from US$67.0 million to US$69.0 million, representing a year-over-year increase of 10.6% to 13.9% from the same period in 2010 and a quarter-over-quarter increase of 14.5% to 17.9% from the previous quarter.

AirMedia currently expects that concession fees will be approximately US$41.5 million in the third quarter of 2011. The quarter-over-quarter increase from the second quarter of 2011 will be primarily due to the full quarter operation of advertisements on the gate bridges at Terminal 3 of the Beijing Capital International Airport.

BEIJING, June 9, 2011 /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 that its chairman and chief executive officer, Herman Guo, has made purchases of US$1,063,293 of the Company's American Depositary Shares (ADSs) from the public market during the period from May 26 to June 8. The purchases were made under the account of Mr. Guo's wife.　

Mr. Guo, who is the founder and largest shareholder of AirMedia, purchased a total of 299,524 ADSs at an average price of US$3.55 per ADS, with an approximate value of US$1,063,293. Each ADS represents two ordinary shares and is traded on the Nasdaq Global Exchange.

Mr. Guo has also advised the Company that he expects to purchase additional shares from time to time during the next several months. Such purchases would be made by Mr. Guo or his wife, or by investment vehicles that are wholly owned and controlled by Mr. Guo or his wife, in accordance with AirMedia's internal share trading policy regarding officers and directors.

"Despite recent decreases in automobile advertising spending due to the Japanese earthquake, I believe our business is strong in business fundamentals and financials. Our business development is on track and I have strong confidence in the growth prospects of the Company," remarked Mr. Guo.

Our principal uses of cash primarily include capital expenditures, contractual concession fees, business acquisitions and other investments and, to a lesser extent, salaries and benefits for our employees and other operating expenses. We expect that these will remain our principal uses of cash in the foreseeable future. We may also use additional cash to fund strategic acquisitions.

We believe that our current cash and anticipated cash flow from operations will be sufficient to meet our anticipated cash needs, including our cash needs for capital expenditures for the next 12 months. We may, however, require additional cash due to changing business conditions or other future developments, including any investments or acquisitions we may decide to pursue. If our existing cash is insufficient to meet our requirements, we may seek to sell additional equity securities, debt securities or borrow from lending institutions.

First Quarter Results:

• Total revenues increased by 25.8% year-over-year to US$61.4 million.
• Gross profit increased by 65.7% year-over-year to US$3.7 million.
• Net loss attributable to AirMedia's shareholders was US$3.9 million, improving from net loss attributable to AirMedia's shareholders of US$6.5 million in the same period one year ago. Basic and diluted net loss attributable to AirMedia's shareholders per American Depositary Share ("ADS") were both US$0.06.
• Adjusted net loss attributable to AirMedia's shareholders (non-GAAP), which is net loss attributable to AirMedia's shareholders excluding share-based compensation expenses and amortization of acquired intangible assets, was US$2.3 million, improving from adjusted net loss attributable to AirMedia's shareholders (non-GAAP) of US$3.8 million in the same period one year ago. Adjusted basic and diluted net loss attributable to AirMedia's shareholders per ADS (non-GAAP) were both US$0.03

"We are pleased to report a stronger-than-expected revenue growth in the first quarter of 2011. Our automobile advertisers have demonstrated steady and strong preference to our media platforms by delivering revenue growth of 75.4% year-over-year. Our price increase also contributed to the revenue growth," commented Herman Guo, chairman and chief executive officer of AirMedia. "We will continue to focus on our strategy of achieving profitable growth."

AirMedia currently expects that its total revenues for the second quarter of 2011 will range from US$60.0 million to US$62.0 million, which include revenues of US$2.0 million from gate bridges at Terminal 3 of Beijing Capital International Airport, representing a year-over-year increase of 6.5% to 10.1% from the same period in 2010.

AirMedia's board of directors has authorized, but not obligated, AirMedia to repurchase up to US$20 million worth of its own outstanding American Depositary Shares ("ADSs") within two years from March 21, 2011. The repurchases will be made on the open market at prevailing market prices pursuant to a Rule 10b5-1 plan, in negotiated transactions off the market, in block trades or otherwise from time to time. The timing and extent of any purchases will depend upon market conditions, the trading price of ADSs and other factors, and be subject to the restrictions relating to volume, price and timing in accordance with applicable laws. AirMedia expects to implement this share repurchase program in a manner consistent with market condition and the interest of its shareholders. AirMedia's board of directors will review the share repurchase program periodically, and may authorize adjustment of its terms and size accordingly. AirMedia plans to fund repurchases made under this program from its available cash balance.

Fourth Quarter 2010 Financial and Business Highlights

• Total revenues increased by 56.6% year-over-year and by 16.8% quarter-over-quarter to US$70.8 million, a record high in AirMedia's operating history.
• Gross profit was US$14.3 million, improving from gross loss of US$2.8 million in the same period one year ago and increasing by 50.3% quarter-over-quarter from gross profit of US$9.5 million in the previous quarter.
• Net income attributable to AirMedia's shareholders was US$5.1 million, improving from net loss attributable to AirMedia's shareholders of US$19.4 million in the same period one year ago and increasing by 321.6% quarter-over-quarter from net income attributable to AirMedia's shareholders of US$1.2 million in the previous quarter. Basic and diluted net income attributable to AirMedia's shareholders per American Depositary Share ("ADS") was US$0.08 and US$0.07, respectively.
• Adjusted net income attributable to AirMedia's shareholders (non-GAAP), which is net income attributable to AirMedia's shareholders excluding share-based compensation expenses and amortization of acquired intangible assets, was US$7.2 million, improving from adjusted net loss attributable to AirMedia's shareholders (non-GAAP) of US$17.1 million in the same period one year ago and increasing by 88.2% quarter-over-quarter from adjusted net income attributable to AirMedia's shareholders (non-GAAP) of US$3.8 million in the previous quarter. Adjusted basic and diluted net income attributable to AirMedia's shareholders per ADS (non-GAAP) was US$0.11 and US$0.10, respectively vs. (0.26). 
• The company continued generating positive operating cash flow in excess of capital expenditures in the fourth quarter of 2010. Other than restricted cash of US$6.8 million, cash and short-term investments increased to US$106.5 million as of December 31, 2010, from US$96.5 million as of September 30, 2010.
• CCTV Air Channel was established on the Company's digital TV screens in airports and digital TV screens on airplanes to broadcast TV programs to air travelers in China in December 2010.
• In November 2010, AirMedia renewed its concession rights contract with Beijing Capital Airport Advertising Co., Ltd. to operate digital frames and digital TV screens at Terminal 3 of Beijing Capital International Airport for five years from January 1, 2011 to December 31, 2015.

Fiscal Year 2010 Financial Highlights

• Total revenues increased by 55.0% year-over-year to US$236.5 million.
• Net loss attributable to AirMedia's shareholders was US$4.9 million, improving from net loss attributable to AirMedia's shareholders of US$37.2 million in fiscal year 2009. Basic and diluted net loss attributable to AirMedia's shareholders per ADS were both US$0.07.
• Adjusted net income attributable to AirMedia's shareholders (non-GAAP), which is net loss excluding share-based compensation expenses and amortization of acquired intangible assets, was US$6.8 million, improving from adjusted net loss attributable to AirMedia's shareholders (non-GAAP) of US$28.9 million in fiscal year 2009. Adjusted basic and diluted income attributable to AirMedia's shareholders per ADS (non-GAAP) were both US$0.10 vs. ($0.44).

"Year 2010 was a turnaround year for AirMedia. The Company returned to profitability in the third quarter and further increased its bottom-line margin in the fourth quarter with strong revenue growth. We are encouraged by the positive market outlook on 2011. With our strong operating leverage to drive margin growth, we expect Year 2011 to be a year of harvesting for AirMedia. We will continue to focus on improving utilization rates of our current media network and increasing our profitability," commented Herman Guo, chairman and chief executive officer of AirMedia.

"We are pleased to report another profitable quarter in the fourth quarter with sequential top-line growth from most of our major product lines. Total revenues, revenues from digital frames, and revenues from digital TV screens on airplanes all reached record high numbers in the fourth quarter. Digital TV screens in airports continued to turn around. Traditional media in airports started to contribute meaningful net income to the Company. Other than working on our top-line growth, we will also focus on optimizing our cost structure and operational efficiency to achieve sustainable profit in the future," Ping Sun, AirMedia's chief financial officer, commented.

Business Outlook 

AirMedia currently expects that its total revenues for the first quarter of 2011 will range from US$58.0 million to US$60.0 million, which do not include the potential revenues from the newly signed billboards and painted advertisement on gate bridges at Terminal 3 of Beijing Capital International Airport, representing a year-over-year increase of 18.9% to 23.0% from the same period in 2010.

AirMedia currently expects that concession fees will be approximately US$38.1 million in the first quarter of 2011.The quarter-over-quarter increase from the fourth quarter of 2010 will be primarily due to the newly signed billboards and painted advertisement on gate bridges at Terminal 3 of Beijing Capital International Airport.

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

• Total revenues increased by 60.6% year-over-year and by 7.6% quarter-over-quarter to US$60.6 million, a record high in AirMedia's operating history.

• Gross profit was US$9.5 million, improving from gross loss of US$628,000 in the same period one year ago and gross profit of US$6.5 million in the previous quarter.

• Net income attributable to AirMedia's shareholders was US$1.2 million, improving from net loss attributable to AirMedia's shareholders of US$9.6 million in the same period one year ago and net loss attributable to AirMedia's shareholders of US$4.7 million in the previous quarter. Basic and diluted net income attributable to AirMedia's shareholders per American Depositary Share ("ADS") were both US$0.02.

• Adjusted net income attributable to AirMedia's shareholders (non-GAAP), which is net income attributable to AirMedia's shareholders excluding share-based compensation expenses and amortization of acquired intangible assets, was US$3.8 million, improving from adjusted net loss attributable to AirMedia's shareholders (non-GAAP) of US$7.0 million in the same period one year ago and adjusted net loss attributable to AirMedia's shareholders (non-GAAP) of US$424,000 in the previous quarter. Adjusted basic and diluted net income attributable to AirMedia's shareholders per ADS (non-GAAP) were both US$0.06.

• Analysts estimates were calling for EPS of nil.

Business Outlook

AirMedia currently expects that its total revenues for the fourth quarter of 2010 will range from US$69.0 million to US$71.0 million, representing a year-over-year increase of 52.7% to 57.1% from the same period in 2009.

AirMedia currently expects that concession fees will be approximately US$34.4 million in the fourth quarter of 2010.

Guidance Report:

Conor Yang, AirMedia's chief financial officer added, "In 2008, we achieved many significant milestones as we continued to execute our growth strategies. In 2009, we will continue to expand our network, strengthen our relationships with airports and airlines and manage expenses to best position AirMedia for long-term top and bottom line growth. We expect that AirMedia's growth momentum and strong financials will position us to take advantage of the various opportunities arising from the global economic downturn and the recent changes in China's out-of-home advertising sector. Our expansion strategy may impose some short-term pressure on our margins but is critical and beneficial for the company's development in the long run."

First Quarter Fiscal 2009 Guidance Ending December

Source: PR Newswire (February 26, 2009)

Guidance Report:

As a result of AirMedia'sperformance in the first three quarters of 2008 and anticipated performance in the fourth quarter of 2008, AirMedia is raising its full year guidance of total revenues for 2008.

Source: PR Newswire (November 6, 2008)