WEB NEWS Going Private News
DALIAN, China, April 22, 2015 /PRNewswire/ -- V Media Corporation (OTC BB: CMDI.OB) ("V Media"), an owner and operator of various outdoor media network in Dalian, Shenyang, Beijing, Tianjin and Shanghai, today announced that it was informed by Guojun Wang, its Chairman and Chief Executive Officer and Ming Ma, its President and Director, representing certain other shareholders (collectively, the "Contributing Stockholders") that, pursuant to a contribution and subscription agreement (the "Contribution Agreement"), among the Contributing Stockholders, Eastern Jin Kai International Limited ("Eastern Jin Kai"), V Media Acquisition Corporation, a Delaware corporation and wholly owned subsidiary of Eastern Jin Kai ("Merger Sub"), (i) the Contributing Stockholders contributed their 90.63% of the shares of common stock, $0.0001 par value per share, of V Media (the "Common Stock") to Eastern Jin Kai in exchange for 25,005,533 ordinary shares of Eastern Jin Kai, and (ii) Eastern Jin Kai contributed all of the shares of Common Stock contributed to it by the Contributing Stockholders to Merger Sub in exchange for one (1) share of common stock of Merger Sub.
As a result of these transactions, on April 22, 2015 Merger Sub acquired 90.63% of the total issued and outstanding shares of Common Stock of V Media and completed a "short-form" merger with V Media continuing as the surviving corporation pursuant to Section 253 of the General Corporation Law of the State of Delaware. As a result of the merger, V Media became a wholly owned subsidiary of Eastern Jin Kai, quotation of the Common Stock on the OTC Bulletin Board will be ceased and V Media filed a Form 15 with the Securities and Exchange Commission to terminate its reporting obligations as a public company under the U.S. securities laws on April 22, 2015. Existing stockholders of the Common Stock will be notified by mail of the cancellation of their shares and their right to receive $0.60 in cash per share upon the submission of their stock certificates in accordance with proper procedures
Going Private News
DALIAN, China, April 21, 2015 /PRNewswire/ -- V Media Corporation (OTC BB: CMDI.OB) ("V Media"), an owner and operator of various outdoor media network in Dalian, Shenyang, Beijing, Tianjin and Shanghai, today announced that it was informed by Guojun Wang, its Chairman and Chief Executive Officer, and Ming Ma, its President and Director, representing certain other stockholders (collectively, the "Contributing Stockholders") that, they have entered into a contribution agreement (the "Contribution Agreement") among the Contributing Stockholders, The Eastern Jin Kai International Limited ("Eastern Jin Kai"), V Media Acquisition Corporation, a Delaware corporation and wholly owned subsidiary of Eastern Jin Kai ("Merger Sub"), pursuant to which (i) the Contributing Stockholders agreed to contribute their 90.63% of the shares of Common Stock, $0.0001 par value per share, of V Media (the "Common Stock") to Eastern Jin Kai in exchange for 25,005,533 ordinary shares of Eastern Jin Kai, and (ii) Eastern Jin Kai contribute all of the shares of common stock contributed to it by the Contributing Stockholders to Merger Sub in exchange for one (1) share of Common Stock of Merger Sub.
Reverse Merger Activity
Item 5.01. Changes in Control of Registrant.
On April 21, 2015, V Media Corporation ("V Media") was informed by Guojun Wang, its Chairman and Chief Executive Officer, and Ming Ma, its President and Director, representing certain other shareholders (collectively, the "Contributing Stockholders") that they have entered into a contribution agreement (the "Contribution Agreement") with The Eastern Jin Kai International Limited ("Eastern Jin Kai"), V Media Acquisition Corporation, a Delaware corporation and wholly owned subsidiary of Eastern Jin Kai ("Merger Sub"). Pursuant to the Contribution Agreement, on April 21, 2015, (i) the Contributing Stockholders contributed their 90.63% of the shares of common stock, $0.0001 par value per share, of V Media (the "Common Stock") to Eastern Jin Kai in exchange for 25,005,533 ordinary shares of Eastern Jin Kai; (ii) Eastern Jin Kai contributed all of the shares of Common Stock contributed to it by the Contributing Stockholders to Merger Sub in exchange for one (1) share of common stock of Merger Sub. As a result of these transactions, Merger Sub acquired 90.63% of the total issued and outstanding shares of Common Stock of V Media. On April 22, 2015, Merger Sub completed a "short-form" merger with V Media pursuant to Section 253 of the General Corporation Law of the State of Delaware by filing a certificate of ownership and merger with the Secretary of State of the State of Delaware.
As a result of the merger, V Media became a wholly owned subsidiary of Eastern Jin Kai, ceased to be a publicly reporting company, and its Common Stock will no longer be quoted on the OTC Bulletin Board. The public stockholders of V Media will receive $0.60 per share upon proper submission of their certificates per instructions that will be delivered to those stockholders. On April 22, 2015, V Media filed a Form 15 with the Securities and Exchange Commission to terminate its reporting obligations as a public company under the U.S. securities laws.
Reverse Merger Activity
Item 5.01 Changes in Control of Registrant.
On April 21, 2015, V Media Corporation ("V Media") was informed by Guojun Wang, its Chairman and Chief Executive Officer, and Ming Ma, its President and Director, representing certain other stockholders (collectively, the "Contributing Stockholders") that they have entered into a contribution agreement (the "Contribution Agreement") with The Eastern Jin Kai International Limited ("Eastern Jin Kai"), V Media Acquisition Corporation, a Delaware corporation and wholly owned subsidiary of Eastern Jin Kai ("Merger Sub"). Pursuant to the Contribution Agreement, on April 21, 2015, (i) the Contributing Stockholders contributed their 90.63% of the shares of Common Stock, $0.0001 par value per share, of V Media (the "Common Stock") to Eastern Jin Kai in exchange for 25,005,533 ordinary shares of Eastern Jin Kai; (ii) Eastern Jin Kai contributed all of the shares of Common Stock contributed to it by the Contributing Stockholders to Merger Sub in exchange for one (1) share of Common Stock of Merger Sub. These transactions will result in Merger Sub acquiring 90.63% of the total issued and outstanding shares of Common Stock of V Media and Merger Sub intends to complete a "short-form" merger with V Media pursuant to Section 253 of the General Corporation Law of the State of Delaware by filing a certificate of ownership and merger with the Secretary of State of the State of Delaware.
Once the merger is complete, V Media will become a wholly owned subsidiary of Eastern Jin Kai, will cease to be a publicly reporting company, and its Common Stock will no longer be quoted on the OTC Bulletin Board. After the merger, V Media understands that its public stockholders of V Media shall receive $0.60 per share upon proper submission of their certificates per instructions that will be delivered to those stockholders.
Comments & Business Outlook
For the six months ended December 31,
For the three months ended December 31,
2014
2013
2014
2013
Revenues
$
7,672,257
$
11,139,156
$
3,524,574
$
5,487,565
Cost of revenue
(7,404,538
)
(8,637,195
)
(4,240,400
)
(4,432,472
)
Gross profit (loss)
267,719
2,501,961
(715,826
)
1,055,093
Selling, general and administrative expenses
(3,533,047
)
(2,713,591
)
(1,657,869
)
(1,438,741
)
Loss from operations
(3,265,328
)
(211,630
)
(2,373,695
)
(383,648
)
Other income (expenses):
Interest income
40,631
30,156
5,146
8,467
Interest expense
(632,505
)
(551,775
)
(313,113
)
(297,627
)
Subsidy income
359,706
194,743
335,330
43,692
Other expenses
(17,103
)
(26,924
)
(827
)
(247
)
Total other income (expenses)
(249,271
)
(353,800
)
26,536
(245,715
)
Loss before income taxes
(3,514,599
)
(565,430
)
(2,347,159
)
(629,363
)
Income tax provision
Current
83,430
-
82,719
(88,669
)
Deferred
-
105,734
-
105,734
Total income tax provision
83,430
105,734
82,719
17,065
Net loss
(3,598,029
)
(671,164
)
(2,429,878
)
(646,428
)
Less: net income (loss) attribute to the noncontrolling interest
(679,305
)
25,713
(471,639
)
(79,439
)
Net loss attributable to V Media Corp.
$
(2,918,724
)
$
(696,877
)
$
(1,958,239
)
$
(566,989
)
Net loss
(3,598,029
)
(671,164
)
(2,429,878
)
(646,428
)
Other comprehensive income
Foreign currency translation gain
93,387
160,555
300,194
126,121
Comprehensive loss
(3,504,642
)
(510,609
)
(2,129,684
)
(520,307
)
Less: comprehensive income (loss) attributed to
the noncontrolling interest
(671,529
)
55,086
(262,322
)
(55,752
)
Comprehensive loss attributable to V Media Corp.
$
(2,833,113
)
$
(565,695
)
$
(1,867,362
)
$
(464,555
)
Loss per share
Basic and diluted
$
(0.11
)
$
(0.03
)
$
(0.07
)
$
(0.02
)
Weighted average number of common shares
Basic and diluted
27,590,701
27,590,701
27,590,701
27,590,701
Management Discussion and Analysis
Revenue
For three months ended December 31, 2014, sales in Dalian district, accounted for 91.9% of our total sales, decreased by $596,074, or 15.5%, to $3,238,118 from $3,834,192 for the three months ended December 31, 2013. The mainly decrease reason is the Company focused resources towards profitable subsidiaries and segments and thus the Company is downsizing its non-profitable subsidiaries. The Company may not renew billboard rentals that did not bring enough cash flow in the prior period.
Sales in Shenyang district decreased $48,565 or 18.8% to $209,131 from $257,696 for the three months ended December 31, 2014. Sales in Shanghai District increased $60,611 or 41,514.4% to $60,757 from $146 for the three months ended December 31, 2014.
Sales in Beijing district decreased by $465,617, or 100%, to $0 from $465,617 for the three months ended December 31, 2014. The reason of the decrease is that Beijing district has lost its only customer (of annual sales RMB 18 million) due to the lease expiration and that the client didn't extend the contract due to expenditure control consideration.
Sales in the US decreased by $692,665, or 100% from $692,665 for the three months ended December 31, 2014. The Company has terminated the lease for the billboard in the US since it didn't generate the level of revenue as the Company previously projected.
Comments & Business Outlook
(UNAUDITED)
For the three months ended September 30,
2014
2013
Revenues
$
4,147,683
$
5,651,591
Cost of revenue
(3,164,138
)
(4,204,723
)
Gross profit
983,545
1,446,868
Selling, general and administrative expenses
(1,875,178
)
(1,274,850
)
Income (loss) from operations
(891,633
)
172,018
Other income (expenses):
Interest income
35,485
21,689
Interest expense
(319,392
)
(254,148
)
Subsidy income
24,376
151,051
Other expenses
(16,276
)
(26,677
)
Total other income (expenses)
(275,807
)
(108,085
)
Income (loss) before income taxes
(1,167,440
)
63,933
Income tax provision
Current
711
88,669
Deferred
-
-
Total income tax provision
711
88,669
Net loss
(1,168,151
)
(24,736
)
Less: net income (loss) attributable to noncontrolling interest
(207,666
)
105,152
Net loss attributable to V Media Corp.
$
(960,485
)
$
(129,888
)
Net loss
(1,168,151
)
(24,736
)
Other comprehensive income
Foreign currency translation gain (loss)
(206,807
)
34,434
Comprehensive income (loss)
(1,374,958
)
9,698
Less: comprehensive income (loss) attributed to noncontrolling interest
(409,207
)
110,838
Comprehensive loss attributable to V Media Corp.
$
(965,751
)
$
(101,140
)
Earnings (loss) per share
Basic and diluted
$
(0.03
)
$
(0.00
)
Weighted average number of common shares
Basic and diluted
27,590,701
27,550,701
Management Discussion and Analysis
Revenues for the three months ended September 30, 2014 were $4,147,683, a decrease of $1,503,908 or 26.6%, from $5,651,591 for the three months ended September 30, 2013. The decrease in revenue was primarily attributable to the revenue decrease in Dalian, Beijing and the US , offset by revenue increase in Shenyang, Tianjin and Shanghai districts.
For three months ended September 30, 2014, sales in Dalian district, accounted for 89.9% of our total sales, decreased by $668,416, or 15.2%, to $3,726,927 from $4,395,343 for the three months ended September 30, 2013. The decrease is mainly the Company focuses their resources towards profitable subsidiaries and segments and thus the Company is downsizing its non-profitable subsidiaries. The Company may not renew billboard rentals that did not bring enough cash flow in the prior periods; instead, it will invest in business segments that have higher gross margins.
Sales in Shenyang district increased $122,738 or 80.2% to $275,861 from $153,123 for the three months ended September 30, 2014. The increase was attributable to increased sales and marketing effort in local market.
Sales in Beijing district decreased by $785,311, or 100%, to $0 from $785,311 for the three months ended September 30, 2014. The reason of the decrease is that Beijing district has lost its only customer (of annual sales RMB 18 million) due to the lease expiration and that the client didn’t extend the contract due to expenditure control considerations.
Sales in the US decreased by $190,667, or 84.7% from $225,000 for the three months ended September 30, 2014. The Company has terminated the lease for the billboard in the US since it didn’t generate the level of revenue as the Company previously projected.
Comments & Business Outlook
For the years ended June 30,
2014
2013
Revenues
$
19,089,508
$
21,823,216
Cost of revenue
(16,250,101
)
(18,247,311
)
Gross profit
2,839,407
3,575,905
Selling, general and administrative expenses
(5,139,047
)
(7,548,595
)
Loss from operations
(2,299,640
)
(3,972,690
)
Other income (expenses):
Interest income
101,567
47,243
Interest expense
(1,205,755
)
(1,359,366
)
Subsidy income
250,686
720,390
Other expenses
(27,760
)
(256,856
)
Total other expenses
(881,262
)
(848,589
)
Loss before income taxes
(3,180,902
)
(4,821,279
)
Income tax provision (benefit)
Current
125,741
458,845
Deferred
-
416,220
125,741
875,065
Net loss
(3,306,643
)
(5,696,344
)
Less: net (income) loss attribute to the noncontrolling interest
(195,990
)
364,535
Net loss attributable to V Media Corp.
$
(3,110,653
)
$
(6,060,879
)
Net loss
(3,306,643
)
(5,696,344
)
Other comprehensive income (loss)
Foreign currency translation gain (loss)
(19,651
)
439,849
Comprehensive loss
(3,326,294
)
(5,256,495
)
Less: comprehensive loss attributed to the noncontrolling interest
201,313
468,566
Comprehensive loss attributable to V Media Corp.
$
(3,527,607
)
$
(5,725,061
)
Earnings (loss) per share
Basic and diluted
$
(0.11
)
$
(0.22
)
Weighted average number of common shares
Basic and diluted
27,590,701
27,590,701
Management Discussion and Analysis
Revenue
Revenues for the fiscal year ended June 30, 2014 were $19,089,508, a decrease of $2,733,708 or 12.5%, from $21,823,216 for the fiscal year ended June 30, 2013. The mainly reason is the Company was affected by the general economic downturn, especially real estate industry during 2012 and 20013. In past year, the Company monitored its operating segments and adjusted its business strategy to face economic change. In order to focus resources towards profitable subsidiaries and segments, the Company is downsizing its non-profitable subsidiaries. It may not renew billboard rentals that did not bring enough cash flow in the past.
Comments & Business Outlook
V MEDIA CORP. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
For the six months ended December 31,
For the three months ended December 31,
2013
2012
2013
2012
Revenues
$ 11,139,156 $ 11,503,181 5,487,565 $ 6,022,218
Cost of revenue
(8,637,195 ) (9,518,511 ) (4,432,472 ) (4,872,815 )
Gross profit
2,501,961 1,984,670 1,055,093 1,149,403
Selling, general and administrative expenses
(2,713,591 ) (3,478,835 ) (1,438,741 ) (1,644,032 )
Loss from operations
(211,630 ) (1,494,165 ) (383,648 ) (494,629 )
Other income (expenses):
Interest income
30,156 2,163 8,467 1,445
Interest expense
(551,775 ) (540,422 ) (297,627 ) (259,069 )
Subsidy income
194,743 443,597 43,692 402,373
Other expenses
(26,924 ) (31,599 ) (247 ) (13,591 )
Total other Income (expenses)
(353,800 ) (126,261 ) (245,715 ) 131,158
Loss before income taxes
(565,430 ) (1,620,426 ) (629,363 ) (363,471 )
Income tax provision (benefit)
Current
- 359,924 (88,669 ) 179,866
Deferred
105,734 (280,322 ) 105,734 (19,137 )
Total income tax provision
105,734 79,602 17,065 160,729
Net loss
(671,164 ) (1,700,028 ) (646,428 ) (524,200 )
Less: net income (loss) attributable to noncontrolling interest
25,713 150,313 (79,439 ) (78,548 )
Net loss attributable to V Media Corp.
$ (696,877 ) $ (1,850,341 ) (566,989 ) $ (445,652 )
Net loss
(671,164 ) (1,700,028 ) (646,428 ) (524,200 )
Other comprehensive income
Foreign currency translation adjustments
160,555 286,853 126,121 143,158
Comprehensive loss
(510,609 ) (1,413,175 ) (520,307 ) (381,042 )
Less: comprehensive income (loss) attributable to noncontrolling interest
55,086 178,270 (55,752 ) (67,651 )
Comprehensive loss attributable to V Media Corp.
$ (565,695 ) $ (1,591,445 ) (464,555 ) $ (313,391 )
Loss per share
Basic and diluted
$ (0.03 ) $ (0.07 ) (0.02 ) $ (0.02 )
Weighted average number of common shares
Basic and diluted
27,590,701 27,590,701 27,590,701 27,590,701
Management Discussion and Analysis
Results of Operations for the Three-Month Period Ended December 31, 2013 Compared to the Three-Month Period Ended December 31 30, 2012
Revenue$5,487,565, a decrease of $534,653 or 8.9%, from $6,022,218 for the three months ended December 31, 2012. The decrease in revenue was primarily attributable to the revenue decrease in Shenyang, Shanghai and Dalian district, offset by revenue increases in Beijing, Tianjin and US district.
The overall decrease of revenue is due to the change of business strategy. Instead of chasing high revenue, we are more focusing on expanding our profitable business units and segments and downsizing those segments and subsidiaries continuously incurring loss.
The other reason for the decrease of revenue is because we lost some real estate clients in this quarter when service term expired. The real estate industry is still under financial pressure thus lowered advertisement budget. We are now developing new customers from banking, food and beverage and other industries to make up the market share loss. We expected that the revenue for the near future will be increased from these customers.
For the three months ended December 31, 2013, sales in Dalian district, accounted for 69.9% of our total sales, a decrease of $1,247,320, or 24.5%, to $3,834,192 from $5,081,512 for the three months ended December 31, 2012.
For three months ended December 31, 2013, sales in Tianjin district increased by 14,860, or 6.7%, to $237,249 from $222,389 for the three months ended December 31, 2012.
Sales in Shanghai District decreased $251,733 or 99.9% to $146 from $251,879 for the three months ended December 31, 2013. The Company is downsizing Shanghai office due to the continuous loss incurred for the past periods.
Sales in Shenyang district decreased $202,951 or 44.1% to $257,696 from $460,647 for the three months ended December 31, 2013.
Sales in Beijing district increased by $459,826, or 7940.4%, to $465,617 from $5,791 for the three months ended December 31, 2013.
Sales revenue in US district increased by $692,665 or 100%, to $692,665 from none for the three months ended December 31, 2013.
Net Income (Loss) Attributable to the CompanyNet loss attributable to the Company was $566,989 for the three months ended December 31, 2013, as compared with the net loss of $445,652 during the three months ended December 31, 2012, representing an increase of 27.2%. The increase in net loss was mainly attributed to our decrease in revenue.
Comments & Business Outlook
Financial Highlights for the Year Ended June 30, 2013
Total revenue for fiscal year 2013 was $21.8 million, increased 18.2% compared with fiscal year 2012
Net loss attributable to V Media Corp. for the year ended June 30, 2013 totaled $6.1 million, a decrease of $6.1 million as compared to a net income of $50,853 for the year ended June 30, 2012. Basic and diluted loss per share for the year ended June 30, 2013 were$0.22 and $0 based on 27.6 million basic and diluted shares outstanding.
Mr. James Wang, Chairman and Chief Executive Officer of V Media, stated, "During our 2013 fiscal year we have been through an advertising market that was much affected by macroeconomic uncertainty. We continue to focus on client diversification and cross selling among different advertising platforms. Our overall revenue increased 18% year-over-year, showing the effectiveness of our strategy, however, our net income was much affected by the cost of developing new markets. Revenue generated from outdoor billboards platforms continued the growth trend- increased 7% from the prior year. Outdoor billboards accounted for 39% of total revenue in our 2013 fiscal year and have presented great growth opportunities for the Company. Going forward we have several projects in pipeline that we expect will contribute to continued performance growth of this platform in the 2014 fiscal year."
Comments & Business Outlook
Financial Results for the 2012 Fiscal Third Quarter Ended March 31, 2012
Revenue for the 2012 fiscal third quarter ended March 31, 2012 totaled $4,071,427 a decrease of 24.6% compared to $5,402,726 for the same period in fiscal 2011.
Gross profit for the 2012 fiscal third quarter ended March 31, 2012 totaled $1.29 million, a decrease of 57.9% compared to $3.1 million for the 2011 fiscal third quarter ended March 31, 2011.
EPS in 2012 was $(0.02) compared to $0.05 a change of -131.8%
Mr. James Wang, Chairman and Chief Executive Officer of China New Media, stated, "During the third quarter of fiscal year 2012, we still see a tougher macro economic environment. Advertisers in certain cyclical industries, such as real estate, have tightened their advertising budgets since the second half of 2011. Facing this unfavorable economic conditions, we are working diligently to strengthen our position in the market - continue to focus on our expansion strategy of adding more advertising platforms geographically, at the same time, focus more on sales, marketing and promotional efforts, and provided more value-added services in order to maintain existing customers and add new customers in our new markets. For each new market we have developed our own sales team to sell existing advertising platforms and develop new advertising platforms. The investment required to build greater future sales resulted in decrease in overall gross profit margins and profitability during the quarter. However, we believe over the long term there will be greater leverage in this model and we strongly believe that it is the best plan of action for the value of the Company and our shareholders."
Mr. Wang continued, "During the third quarter of fiscal year 2012, one of the most significant breakthroughs in our company history is the acquisition of the operation right of the 684 square-foot LED screen located at No.1 Times Square in New York City, USA. It's the first step for our company to expand our media platform and sales network directly to overseas market. We are confident that we will have a margin recovery as the new market gains sales momentum."
Comments & Business Outlook
Financial Results for the 2012 Fiscal Second Quarter Ended December 31, 2011
CHINA NEW MEDIA CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
For the six months ended
December 31,
For the three months ended
December 31,
2011
2010
2011
2010
Revenues
$ 9,605,933 $ 9,168,539 $ 5,043,775 $ 5,047,789
Cost of revenue
(4,405,235 ) (3,962,040 ) (2,281,169 ) (2,228,838 )
Gross profit
5,200,698 5,206,499 2,762,606 2,818,951
Selling, general and administrative expenses
(2,459,023 ) (1,691,586 ) (1,532,733 ) (926,447 )
Income from operations
2,741,675 3,514,913 1,229,873 1,892,504
Other income (expenses):
Interest income
2,891 3,031 1,198 1,529
Interest expense
(469,145 ) (315,557 ) (236,279 ) (159,227 )
Loss from equity investment
(7,901 ) - (7,901 ) -
Other income
- 117,537 - 52,249
Other expenses
(21,248 ) (15,424 ) (1,358 ) (15,288 )
Total Other income (expenses)
(495,403 ) (210,413 ) (244,340 ) (120,737 )
Income before income taxes
2,246,272 3,304,500 985,533 1,771,767
Income tax provision (benefit)
-
Current
566,435 898,516 194,000 494,958
-
Deferred
43,795 (23,204 ) 60,851 (15,042 )
Total income tax provision (benefit)
610,230 875,312 254,851 479,916
Net income
1,636,042 2,429,188 730,682 1,291,851
Less: net income attribute to the noncontrolling interest
152,947 86,570 110,505 34,374
Net income attributable to China New Media Corp.
$ 1,483,095 $ 2,342,618 $ 620,177 $ 1,257,477
Other comprehensive income
Foreign currency translation adjustments
390,948 255,027 202,767 149,608
Comprehensive income
1,874,043 2,597,645 822,944 1,407,085
Less: comprehensive income attribute to the noncontrolling interest
26,769 25,588 14,267 12,975
Comprehensive income attributable to China New Media Corp.
$ 1,847,274 $ 2,572,057 $ 808,677 $ 1,394,110
Earnings per share
Basic
$ 0.05 $ 0.09 $ 0.02 $ 0.05
Diluted
$ 0.05 $ 0.08 $ 0.02 $ 0.04
Weighted average number of common shares
Basic
27,550,701 27,550,701 27,550,701 27,550,701
Diluted
27,550,701 28,196,904 27,550,701 27,997,977
Revenue for the 2012 fiscal second quarter ended December 31, 2011 totaled $5,043,775 a slight decrease of 0.1% compared to $5,047,789 million for the same period in fiscal 2011. The decline in revenue was primarily attributable to a decrease in contracting demand from advertisers under unfavorable macro economic conditions, while the effect was minimized by the Company's diversified advertising platform strategy.
Revenue generated from the outdoor billboard advertising platform increased 49.2% compared with same quarter last year and accounted for 50.5% of total revenue during the 2012 fiscal second quarter. The billboard advertising platform has presented a significant growth opportunity at an attractive gross profit margin of 50.7% during the 2012 fiscal second quarter. The outdoor billboard platform is established in Dalian, Shenyang,Tianjin, Beijing and Shanghai and going forward the Company will continue to establish its presence in these markets.
Mr. James Wang, Chairman and Chief Executive Officer of China New Media, stated, "I am proud that our company continue to focus on our expansion strategy of adding more advertising platforms geographically, and maintaining and adding new customers in our new markets. During the second quarter of fiscal year 2012, we've been through a tougher macro economic environment. Advertisers in certain cyclical industries, such as real estate, significantly reduced their advertising budgets in the second half of 2011; however, we are still able to maintain relatively stable revenue levels compared with same period the prior year. Under the unfavorable economic conditions, we focused more on sales, marketing and promotion efforts, and provided more value-added services to attract new customers. For each new market we have developed our own sales team to sell existing advertising platforms and develop new advertising platforms. The investment required to build greater future sales resulted in a slight decrease in overall gross profit margins and profitability during the quarter. However, we believe over the long term there will be greater leverage in this model and we strongly believe that it is the best plan of action for the value of the Company and our shareholders."
Mr. Wang continued, "In the second half of 2011, we made one of the most significant breakthroughs in our company history with the official launch of our 150 square-meter LED screen located between Terminals 1 and 2 at Beijing Capital International Airport, and in November 2011, we finished the construction of mega 558 square-meter LED screen on top of the Golden Hotel in Shenyang, one of the city's landmark buildings. We are currently evaluating other potential advertising locations in Shenyang and other markets in order to continue broadening our presence."
Comments & Business Outlook
DALIAN, China , January 10, 2012 /PRNewswire-Asia / -- China New Media Corp. (OTCBB: CMDI) (the "Company"), China's fast-growing advertising media company with current outdoor media networks located in Dalian , Shenyang , Tianjin , Shanghai and Beijing , today announced that the Company's trademark "Vastitude Media" has been recognized by the State Administration for Industry and Commerce (SAIC) as a "China Well -known Trademark". This is the first Well- known trademark that has ever been given in the outdoor media industry and entitles the Company to an additional RMB50 million credit line.
The SAIC's "China Well -known Trademark" recognition is China's highest honor for brands with the most visibility, reputation, consumer appeal and market acceptance. According to the SAIC, it will be the last year this honor will be given to ensure the quality of the standard. To date there have been approximately 2,000 companies that have been granted this honor, China New Media being the only media company to have won since its inception. This award entitles the Company to an additional RMB50 million credit line.
Since 2000, China New Media has emerged as the largest outdoor advertiser in the Northeast of China with diverse and unique media platforms including LED billboards, traditional billboards, the City Navigator kiosk, taxi stops, bus shelters and train stations. More recently, the Company has successfully broadened its footprint in northern China with operations in Dalian , Beijing , Shanghai , Tianjin and Shenyang . In October 2011 , the Company announced a $2.8 million advertising contract with the official launch of the first LED screen located at the Beijing Capital International Airport.
Mr. James Wang , Chairman and CEO of China New Media, stated, "It is with great honor that we receive this award from the SAIC and are recognized as the first outdoor advertising company to do so. Since inception our goal has been to provide each city with scenery in an effort to enhance its development and economy. We began operations in Dalian and have since entered into four new markets including Shanghai and Beijing . Our efforts, professionalism and growth in these markets have granted us national recognition by the SAIC. We will continue to execute on our strategic plan of providing clients with a broad array of media platforms throughout five major cities in China , allowing us to create increased economic opportunities for both ourselves and our clients."
Comments & Business Outlook
First Quarter 2012 Results
Revenue for the 2012 fiscal first quarter ended September 30, 2011 totaled $4.6 million , an increase of 10.7% compared to $4.1 million for the same period in fiscal 2011.
Net income attributable to China New Media Corp. for the three months ended September 30, 2011 was $863,000 as compared to $1.1 million for the three months ended September 30, 2010 .
Basic and diluted earnings per share for the 2012 fiscal first quarter ended September 30, 2011 was $0.03 based on 27.6 million basic and diluted shares versus basic and diluted earnings per share of $0.04 for the 2011 fiscal first quarter ended September 30, 2010
Mr. James Wang , Chairman and Chief Executive Officer of China New Media, stated, "Heading into our 2012 fiscal year we set out to accomplish several goals including increasing revenue through greater sales to existing and new customers and making strategic long term investments in our new markets, Beijing , Shanghai , Tianjin , and Shenyang . During the 2012 fiscal first quarter we steadily increased revenue year-over-year approximately 11% driven by a 25% increase in revenue of our outdoor billboard advertising platform which carried a high gross profit margin of 49%, which is much higher than the industry average. Year-over-year we also saw an 82% increase in revenue from our City Navigator platform which yielded 70% gross profit margins. In our new markets, especially Beijing and Shanghai , we increased our sales and marketing strategy for the long term value we expect to generate. For each new market we have now developed our own sales team to sell existing advertising platforms and develop new advertising platforms. The investment required to build greater future sales resulted in a slight decrease in overall gross profit margins and profitability during the quarter. However, we believe over the long term there will be greater leverage in this model and we strongly believe that it is the best plan of action for the value of the Company and our shareholders."
Mr. Wang continued, "Recently we made one of the most significant breakthroughs in our company history with the official launch of our 150 square-meter LED screen located between Terminals 1 and 2 at Beijing Capital International Airport. The launch of this platform and the coinciding $2.8 million advertising contract with Henan Dayou Energy is an excellent starting point to build the China New Media brand in Beijing . We are currently evaluating other potential advertising locations in Beijing and other markets in order to continue broadening our presence."
Comments & Business Outlook
DALIAN, China ,
October 31, 2011 /
PRNewswire-Asia / -- China New Media Corp. (OTCBB: CMDI) (the "Company"),
China 's fast-growing advertising media company with current outdoor media network located in
Dalian ,
Shenyang ,
Tianjin ,
Shanghai and
Beijing , today announced the official launch of the first LED screen located at the Beijing Capital International Airport with 150 square meters in size, or approximately 1,1614 square feet.
The Company has signed a one-year advertising contract effective October 1, 2011 valued at RMB18 million or approximately $2.8 million .
Comments & Business Outlook
Fiscal 2011 Results
Financial Highlights for the Year Ended June 30, 2011
Revenue increased 47% year-over-year to $20.6 million
Gross profit increased 42% to $11.6 million ; gross margin was 56.4%
Net income increased 16% to $5 million or $0.18 EPS vs. $0.16
Mr. James Wang , Chairman and Chief Executive Officer of China New Media, stated, "During our 2011 fiscal year we achieved several milestones which resulted in progress made from an operational and financial point of view. Our overall revenue grew 47% year-over-year based on an increase in each of our outdoor advertising platforms primarily driven by an increase of 163% from our outdoor billboards . Outdoor billboards accounted for 33% of total revenue in our 2011 fiscal year . Going forward we have several projects in pipeline that we expect will contribute to continued performance growth of this platform in the 2012 fiscal year. Recently we have also explored other advertising avenues for clients such as the creative outdoor display with Casio and making a strategic investment in Le Tian Net , the third largest online platform in Dalian ."
Mr. Wang, continued, "We successfully entered two new markets during the 2011 fiscal year, as well as continued to build a diversified customer base. Today we have operations in Dalian , where we are headquartered, Shenyang , Tianjin , and added an operational presence in Beijing and Shanghai during the year. The establishment of our operations and brand in each new city is an important component in our growth strategy. As we enter a new city, we organize a dedicated sales team for that market to generate new client leads, sell through our other advertising platforms to existing clients, and service customer accounts. As we have added new markets and new unique platforms we have grown our customer base year-over-year, which includes well known and established corporations from around the world, and we have seen our existing customers continue to come back to us for their outdoor advertising needs. As we continue to build our presence in these new markets we expect to continue garnering the interest of new customers and enhance our relationships with existing customers."
Comments & Business Outlook
Summary Financials for Third Quarter Ended March 31, 2011:
2011 Fiscal Third Quarter Results (USD) (unaudited)
Three months ended March 31, 201 1
Fiscal Q3 2011
Fiscal Q 3 2010
CHANGE
Revenue
$ 5.4 million
$ 4.1 million
+31.2%
Gross Profit
$3. 1 million
$ 2.6 million
+18.3%
Net Income
$1.4 million
$1. 4 million
-
EPS
$0.05
$0.05
-
Summary Financials for Nine Months Ended March 31, 201 1 :
2011 Fiscal First Nine Month Results (USD) (unaudited)
Nine months ended March 31, 201 1
Fiscal 2011
Fiscal 2010
CHANGE
Revenue
$ 14.6 million
$ 11.3 million
+28.8%
Gross Profit
$ 8 .3 million
$ 6.9 million
+20%
Net Income
$ 3. 8 million
$ 3.6 million
+5.2%
EPS
$0.14
$0.13
+8%
Mr. James Wang, Chairman and Chief Executive Officer of China New Media, stated, "The 31% revenue growth during the quarter was driven by new technology advertising platforms and our entrance into new markets. Revenue growth in our outdoor billboard platform grew 71.9% and accounted to 34.9% of total revenue compared to 26.6% the prior year. The outdoor advertising industry is demanding new and innovative technology such as our billboards and City Navigator kiosks to grab the attention of the consumer. As a result we were able to generate revenue in two new markets during the quarter as compared to the previous year, Tianjin and Shanghai. As a one stop shop, once we enter these new markets and establish our brand, we are able to leverage our other platforms such as the street fixture, display networks and city transit system displays, and further have a margin recovery as the new market gains sales momentum."
Comments & Business Outlook
Financial results for its second quarter of fiscal year 2011 ended in December 31, 2010.
Financial Summary
Second Quarter FY 20 11 Results (USD)
(Three months ended December 31, 2010)
Q 2 20 11
Q 2 20 10
CHANGE (%)
Revenue
$ 5 . 0 million
$ 4 . 0 million
+ 27 . 3 %
Gross Profit
$2. 8 million
$ 2 . 3 million
+ 24 . 3 %
Net Income
$ 1 . 3 million
$ 1 . 1 million
+1 0 . 9 %
EPS (Fully Diluted)
$0. 05
$0. 0 4
+ 25 . 0 %
First Six Months FY 20 11 Results (USD)
(Six months ended December 31, 2010)
Six Months FY 20 11
Six Months FY2010
CHANGE
(%)
Revenue
$ 9 . 2 million
$ 7 . 1 million
+ 28.5 %
Gross Profit
$ 5 . 2 million
$ 4 . 2 million
+ 22 . 8 %
Net Income
$ 2 . 3 million
$ 2 . 0 million
+1 4 . 8 %
EPS (Fully Diluted)
$0. 0 9
$0. 0 8
+ 12.5 %
"We are pleased with our performance in the second quarter of fiscal year 2011. With our continuous focus on expanding our outdoor media network and aggressively seeking new sales contracts, our business remains strong and growing," stated Mr. James Wang, Chairman and Chief Executive Officer of China New Media. "We continue to focus on building our brand name to earn new clients and to foster client loyalty with our existing customer base. Our presence in Dalian, Shenyang, Tianjin and Shanghai was further strengthened, with new platforms added and being constructed in all those cities. We believe that our strong performance demonstrates the effectiveness of our business strategy of aggressively expanding our media platform into major cities of China, and to penetrate further into the markets where we are established. We expect to see continued growth in 2011."
Comments & Business Outlook
DALIAN, China, Jan. 24, 2011 /PRNewswire-Asia / -- China New Media Corporation today announced it entered an agreement with Shenyang Golden Hotel for acquisition of the operating rights of a billboard located at key business district on Qingnian Street in Shenyang city for a period of three years. The Company plans to invest approximately RMB 3 million (US$ 455,000) to upgrade it into a mega-sized LED screen with size over 500 square meters (approximately 5,382 square feet). Once it's been upgraded, the Company expects that it will become a new landmark for the city.
Comments & Business Outlook
First Quarter Fiscal 2011 Financial Highlights
Revenues for the first quarter of fiscal year 2011 increased by 30.1% year-over-year to $4.1 million , up from $3.2 million in the first quarter of 2010 Net income attributable to the Company for the first quarter increased 19.6% year-over-year to $1.1 million , compared with $0.9 million for the first quarter of fiscal 2010 Gross margin for the first quarter was 57.9% based on gross profit of $2.4 million , compared with a 62.3% margin in the same period last year Operating income and operating margin for the first quarter were $ 1.6 million and 39.4% , respectively, compared to $1.4 million and 44.0 %, respectively, in the first quarter of 2010 Earnings per diluted share were $0.04 for the quarter, compared with diluted EPS of $0.03 achieved in the same period a year ago
"We are pleased with our strong performance in the first quarter," said James Wang , Chief Executive Officer of China New Media. "We've seen continued growth in our business, the new advertising contracts we have acquired boosted both our top and bottom lines in the double digits, and we have maintained a healthy net margin of approximately 26%. Demand for outdoor advertising platforms remains high throughout China as the economy undergoes a transition toward developing domestic consumer demand. We remain committed to expanding our client base in Dalian, Shenyang , Shanghai , and Tianjin and will aggressively pursue market share in new regions as well."
Liquidity Requirements
Based on our current operating plan, we believe that our existing resources, including cash generated from operations as well as the bank loans, will be sufficient to meet our working capital requirement for our current operations. In order to fully implement our business plan and continue our growth, however,
we will require additional capital either from our stockholders or from outside sources.
Comments & Business Outlook
Fiscal year ended June 30, 2010 .
Revenue for the fiscal year ended June 30, 2010 was $13.98 million , an increase of approximately $5.56 million or 66.1%, from $8.42 million for the fiscal year ended June 30, 2009 .
Gross profit increased 64.3% to $8.16 million in the fiscal year ended June 30, 2010 , compared with $4.96 million for the same period of 2009.
Net income attributable to the Company increased 48.9% to $4.22 million , compared with $2.83 million in the same period a year ago.
Earnings per diluted share were $0.15 and $0.11 for the fiscal year 2010 and 2009, respectively, representing a year-over-year increase of 36.4% .
"We are very pleased with our results for fiscal 2010, which exceeded our expectations. The record revenues and profitability we achieved during the fiscal year reflect the successful expansion of our outdoor media network in Dalian, Shenyang and Tianjin , three key commercial cities in northeast China ," said James Wang , Chief Executive Officer of China New Media. "Our groundbreaking City Navigator(R) multimedia advertising platform also began to generate revenues in 2010, and we expect this business segment to become a major growth driver for the Company as we expand our advertising network into China's top-tier commercial cities, including Beijing and Shanghai ."
Mr. Wang continued, "As China's economic growth and urbanization continues at a steady pace, the nation's outdoor advertising industry is poised for double-digit growth in the coming years. Going forward, we plan to aggressively promote our brand name to broaden our multinational client base, which has grown from 562 to 1,687 clients since the end of fiscal 2009. We also intend to deploy the latest advances in digital display technology to attract new customers and meet the advertising needs of our existing clients. Our business strategy is proving tremendously effective, and we are more confident than ever in our growth prospects for fiscal 2011 and beyond ."
Business Outlook
The increase in China New Media's operating results over the past two fiscal years is attributable to a number of factors, including the substantial expansion of the Company's outdoor media network in Dalian, Shenyang and Tianjin , which are three of the largest cities in northeast China , and the Company's technical innovation and large-scale media system upgrading.
Demand for the Company's services is directly related to outdoor advertising spending in northeast China , which is determined by economic conditions in the region . According to the "Statistical Communiqu¨¦ of the PRC on 2008 National Economic and Social Development" released by the National Bureau of Statistics of China in February 2009 , China's economy grew at an annual rate of 9% to 13% over the previous five years. Domestic retail sales grew at an average annual growth rate of 15.5% over the same period. The Chinese government's latest economic stimulus plan is aimed at building a domestic consumer-driven economy, which the Company believes will generate more demand for outdoor advertising. China New Media expects outdoor advertising spending in its regional market to maintain its double-digit growth in the years to come.
