Visionchina Media (NASDAQ:VISN)

Key Quarterly Financial and Operating Data for the First Quarter of 2012

Total revenues, consisting entirely of advertising service revenue, in the first quarter of 2012 were $28.3 million, slightly exceeding the Company's guidance.

Gross loss in the first quarter of 2012 was $4.0 million.

Operating loss in the first quarter of 2012 was $22.5 million.

Net loss attributable to Vision China Media shareholders in the first quarter of 2012 was $21.1 million.

In the first quarter of 2012, the Company's non-GAAP financial measure, net loss attributable to VisionChina Media shareholders, excluding share-based compensation expenses, amortization of intangible assets and provision for contingent loss in connection with litigation, was $18.0 million, within the Company's guidance range.

Basic and diluted net loss per share attributable to Vision China Media shareholders in the first quarter of 2012 was $0.21 and $0.21, respectively (each ADS representing one common share).

The Company had cash and cash equivalents of $75.9 million as of March 31, 2012. Net cash used in operating activities was $11.1 million in the first quarter of 2012.

Total broadcasting hours in the Company's network in the first quarter of 2012 were 41,012 hours.

As of March 31, 2012, the Company's network covered 20 cities secured either by exclusive agency agreements or joint venture contracts, and included 135,762 digital displays on mass transit systems.

Average advertising revenue per broadcasting hour in the Company's network in the first quarter of 2012 was $679.

The Company sold an average of 6.31 advertising minutes per broadcasting hour in its network in the first quarter of 2012.

Mr. Limin Li, Vision China Media's chairman and chief executive officer, commented, "In the first quarter, seasonality was exacerbated by a decline in advertising spending by internet-based businesses that had recently experienced a slowdown in capital raising. The quarter was also impacted by a temporary pull-back in advertising spending by some of our small and medium size enterprise clients in reaction to rate card increases in the fourth quarter of 2011 across our network. We continue to be committed to the optimization of our management systems and media platform, to product and programming innovation, and to increased distribution of self-produced television programming. In light of the upcoming London Olympic Games, we remain confident in our ability to perform in the second half of 2012 and expect to attract incremental advertising spending."

Stanley Wang, VisionChina Media's senior vice president of finance, added, "Although seasonality and a delay in advertiser spending influenced our year-over-year and sequential revenue comparisons, we delivered advertising service revenue totals that exceeded our guidance. As in previous years, we expect to see a rebound in the second half of 2012, and our results in the second quarter of 2012 thus far are in line with those expectations. An improving revenue picture over the year, combined with our continuous cost-reduction efforts, should allow for improvement to our bottom line in the second half of 2012."

Business Outlook

The Company estimates its advertising service revenue in the second quarter of 2012 to be between $40.0 million and $43.0 million. Second quarter 2012 net loss attributable to VisionChina Media shareholders excluding share-based compensation expenses, amortization of intangible assets, contingent loss in connection with litigation, and/or impairment loss and income tax credit in connection with the impairment loss, (non-GAAP) is estimated to be between $5.0 million and $8.0 million.

These estimates are based on an exchange rate of RMB 6.3122 per $1.00.

The Company noted that its guidance is based on its current network that, as of the date of this press release, has already been secured by exclusive agency agreements or joint venture contract and based on management's current assessment of the possible outcome of pending litigation with the selling shareholders and former management of Digital Media Group. If the number of cities in the Company's network expands or contracts, or if there is any progress in the pending litigation that affects management's assessment of the possible outcome, management's forecast could be affected.

Key Quarterly Financial and Operating Data for the Fourth Quarter of 2011

Total revenues in the fourth quarter of 2011 were $53.4 million, a record high in VisionChina Media's operating history. Advertising service revenue, which accounted for 96.7% of total revenues in the fourth quarter of 2011, was $51.6 million, representing increases of 14.9% and 2.7% compared to the fourth quarter of 2010 and third quarter of 2011, respectively.

Gross profit in the fourth quarter of 2011 was $21.4 million, compared to gross profit of $17.8 million in the third quarter of 2011.

Operating profit in the fourth quarter of 2011 was $2.4 million, compared to operating profit of $0.8 million in the third quarter of 2011.

Net income attributable to VisionChina Media shareholders in the fourth quarter of 2011 was $1.7 million, compared to net loss of $0.8 million in the third quarter of 2011.

In the fourth quarter of 2011, the Company's non-GAAP financial measure, net income attributable to VisionChina Media shareholders, excluding share-based compensation expenses, amortization of intangible assets and provision for contingent loss in connection with a litigation ("non-GAAP net income") was $4.1 million, compared to non-GAAP net income of $3.7 million in the third quarter of 2011.

Basic and diluted net income per share attributable to VisionChina Media shareholders in the fourth quarter of 2011 were $0.02 and $0.02, respectively (each ADS representing one common share), compared to basic and diluted net loss per share attributable to VisionChina Media shareholders of $0.01 and $0.01, respectively, in the third quarter of 2011.

The Company had cash and cash equivalents of $80.3 million as of December 31, 2011. Net cash provided by operating activities was $7.0 million in the fourth quarter of 2011, compared to net cash used in operating activities of $10.7 million in the third quarter of 2011.

Total broadcasting hours in the Company's network in the fourth quarter of 2011 were 41,463 hours, compared to network capacity of 43,778 hours in the third quarter of 2011.

As of December 31, 2011, the Company's network covered 20 cities either secured by exclusive agency agreements or joint venture contracts, and included 137,423 digital displays on mass transit systems.

Average advertising revenue per broadcasting hour in the Company's network was $1,217 in the fourth quarter of 2011, compared to $1,122 in the third quarter of 2011.

The Company sold an average of 8.95 advertising minutes per broadcasting hour in the fourth quarter of 2011, compared to 10.64 advertising minutes per broadcasting hour in the third quarter of 2011.

Business Outlook

The Company estimates its advertising service revenue in the first quarter of 2012 to be between $27.0 million and $28.0 million. First quarter 2012 net loss attributable to VisionChina Media shareholders excluding share-based compensation expenses, amortization of intangible assets and provision for contingent loss in connection with a litigation (non-GAAP) is estimated to be between $17.0 million and $18.0 million. The Company estimates that advertising service revenue during the first quarter of 2012 will be negatively affected by seasonality. The Company expects that the seasonal impact will be short-term in nature and that the Company's advertising service revenue will increase in subsequent quarters.

These estimates are based on an exchange rate of RMB 6.3523 per $1.00.

The Company noted that its guidance is based on its current network that, as of the date of this press release, has already been secured by exclusive agency agreements or joint venture contract and based on management's current assessment of the possible outcome of pending litigation with the selling shareholders and former management of Digital Media Group. If the number of cities in the Company's network expands or contracts, or if there is any progress in the pending litigation that affects management's assessment of the possible outcome, management's forecast could be affected.

BEIJING, December 29, 2011 /PRNewswire-Asia/ -- VisionChina Media Inc. ("VisionChina Media" or the "Company") (Nasdaq: VISN), one of China's largest out-of-home digital television advertising networks on mass transportation systems, today announced it has obtained shareholder approval for all matters submitted for approval at the Company's 2011 annual general meeting, held in Hong Kong on December 28, 2011.

The following resolution proposed by the Company was approved by VisionChina Media's shareholders:

Ratification of the appointment of Deloitte Touche Tohmatsu CPA Ltd. as the Company's independent auditors for the year ending December 31, 2011.

Materials related to the annual general meeting of shareholders, including the proxy statement, are available on the Company's website at http://www.visionchina.cn

Third Quarter 2011 Results

First Quarter Results:

• Total revenues in the first quarter of 2011 were $32.5 million.
• Gross profit in the first quarter of 2011 was $0.2 million.
• Operating loss in the first quarter of 2011 was $14.3 million.
• Net loss attributable to VisionChina Media shareholders in the first quarter of 2011 was $13.0 million.
• Net loss attributable to VisionChina Media shareholders in the first quarter of 2011 excluding share-based compensation expenses and amortization of intangible assets (non-GAAP) was $10.9 million.
• Basic and diluted net loss per share attributable to VisionChina Media shareholders in the first quarter of 2011 were $0.13 and $0.13, respectively (each ADS representing one common share).

Mr. Limin Li, VisionChina Media's chairman and chief executive officer, commented, "In the first quarter, we were delighted to see a new revenue stream emerge from new types of internet-based businesses such as social networking, group-buy and video sharing websites. These types of companies promote their brands and products aggressively and VisionChina Media has begun to benefit from their increased advertising spending. Furthermore, VisionChina Media is engaging in closer cooperation with China's leading satellite TV stations to further leverage their highly-rated programming and improve the commuting viewer experience while increasing our utilization. Our management team has focused on a continual effort to control media costs across our network. We have been pleased to see those efforts paying off and are confident that this year's annual media cost targets will be met. We welcome these developments as well as the growth in more authoritative third party research seen recently that highlights the effectiveness and reach of our platform and thereby enhances our growth prospects

The Company estimates total revenues, which consist of advertising service revenue only, in the second quarter of 2011 to be between $44.7 million and $46.2 million. Second quarter 2011 net income attributable to VisionChina Media shareholders excluding share-based compensation expenses and amortization of intangible assets (non-GAAP) is estimated to be between $0.5 million and $2.0 million.

BEIJING, April 28, 2011 /PRNewswire-Asia/ -- VisionChina Media Inc. today announced that the Company has renewed its exclusive contracts to operate its digital mobile television advertising network on Guangzhou subway for the next five years and on Shenyang buses for the next three years. Further, the Company announced that it has signed a contract to add three new subway lines to its existing subway network in Shenzhen for the next five years.

The new five-year exclusive contract in Guangzhou will be effective May 1, 2011. The new contract grants VisionChina Media the exclusive right to operate its digital mobile television advertising network on the five existing subway lines and new extensions of those lines, as well as on three new subway lines in Guangzhou. With this contract in place, VisionChina Media will operate on no less than 10,025 digital mobile television screens on all eight subway lines in Guangzhou.

Additionally, VisionChina Media renewed a contract with Liaoning Beidou Xingkong Digital Television Media Co., Ltd., granting the Company the exclusive right to operate its digital mobile television advertising on Shenyang's bus network for the next three years. This contract went into effect April 1, 2011.

The five-year contract for Shenzhen's three new subway lines will be effective July 1, 2011 and grants VisionChina Media the exclusive right to operate digital mobile television advertising on no less than 5,416  screens in Shenzhen's subway network.

Mr. Limin Li, VisionChina Media's chairman and chief executive officer, said, "The Guangzhou and Shenzhen subway media platforms, which operate in two of China's four Tier 1 cities, are of great strategic importance to VisionChina Media as they represent a significant portion of mobile television advertising spending in China. The signing of two exclusive contracts in these cities once again solidifies our near 100% market share in China's subway mobile television sector."

Li continued, "Furthermore, the addition of three new subway lines to our subway network in Shenzhen greatly enhances our network coverage in that city. With the 2010 Guangzhou Asian Games behind us, we look forward to the opening of the 26th Universiade in Shenzhen in August 2011. As the mobile television media platform of choice in China's urban public transit system, VisionChina Media is once again poised to demonstrate our ability to broadcast real time television programming that commuters enjoy, as well as our ability to attract the world's finest advertisers. We are also pleased with the successful renewal of our bus contract in Shenyang, which serves as the center of China's northeastern region and is strategically important to us."

Li concluded, "While actively managing the quality and diversity of our media resources in key regions of China, VisionChina Media will continue to effectively execute ongoing media cost control measures in 2011."

Guangzhou, the capital city of Guangdong province, had 10.3 million residents as of the end of 2009. According to official statistics, Guangzhou's GDP reached RMB911.3 billion (approximately US$140.2 billion) in 2009, ranking the city number three among cities in mainland China.

Shenzhen, where VisionChina Media's headquarters are located, had 8.9 million residents as of the end of 2009. According to official statistics, Shenzhen's GDP reached RMB820.1 billion (approximately US$126.2 billion) in 2009, ranking the city number four among cities in mainland China. 

Shenyang, the capital city of Liaoning Province, had 7.9 million residents as of the end of 2009. According to official statistics, Shenyang's GDP reached RMB435.9 billion (approximately US$67.1 billion) in 2009, ranking the city number 15 among cities in mainland China.

Fourth Quarter Highlights:

• Total revenues in the fourth quarter of 2010 increased 18.4% quarter-over-quarter to $44.9 million, a record high in VisionChina Media's operating history.
• Gross profit in the fourth quarter of 2010 was $11.6 million, an increase of 69.8% from $6.8 million in the third quarter of 2010.
• The Company's fourth quarter net income attributable to VisionChina Media shareholders, excluding share-based compensation expenses, amortization of intangible assets, impairment loss and income tax credit in connection with impairment loss (non-GAAP net income), was $4.5 million, compared to $1.1 million in the third quarter of 2010.
• Basic and diluted net loss per share attributable to VisionChina Media shareholders in the fourth quarter of 2010 were $0.53 and $0.53, respectively (each ADS representing one common share), compared to basic and diluted net loss per share attributable to VisionChina Media shareholders of $0.02 and $0.02, respectively, in the third quarter of 2010.

Mr. Limin Li, VisionChina Media's chairman and chief executive officer, commented, "Even with the seasonality and integration challenges we faced in the first quarter, the 2010 fiscal year was one of growth and expansion for VisionChina Media with record high quarterly revenues in the fourth quarter. During 2009 and the beginning of 2010, we continued to build our network, connecting above-ground buses with underground subway systems across China, giving our advertisers the benefit of a vast network, hugely populated with Chinese consumers. In the second half of 2010, we began to focus on deeper penetration of existing cities and the further monetization of our network. We have also begun working with our bus and subway partners to reduce media costs in certain cities. While we have come to expect seasonal weakness in the first quarter, I am confident that with these efforts, VisionChina Media will achieve strong revenue growth and deliver promising results in 2011."

The Company estimates

• total revenues, which consist of advertising service revenue only, in the first quarter of 2011 to be between $32.0 million and $34.0 million.
• First quarter 2011 net loss attributable to VisionChina Media shareholders excluding share-based compensation expenses and amortization of intangible assets (non-GAAP) is estimated to be between $10.0 million and $12.5 million. The Company estimates that advertising service revenue during the first quarter will be negatively affected by seasonality. The Company expects that the seasonal impact will be short-term in nature and that the Company's advertising service revenue will increase in subsequent quarters.

BEIJING, March 2, 2011 /PRNewswire-Asia/ -- VisionChina Media Inc. today announced that it, together with its wholly-owned subsidiary Vision Best Limited ("Vision Best"), were named in a lawsuit commenced on February 25, 2011 by Shareholder Representative Services, LLC, Oak Investment Partners XII, Limited Partnership, Gobi Partners, Inc., Gobi Fund, Inc., and Gobi Fund II, L.P. (collectively, the "Former Digital Media Group Shareholders") in the Supreme Court of the State of New York, New York County, relating to VisionChina Media's November 16, 2009 acquisition of Digital Media Group Company Limited ("Digital Media Group").

The lawsuit is a counter-suit to a lawsuit filed by VisionChina Media and Vision Best on December 27, 2010 against the Former Digital Media Group Shareholders.  The Former Digital Media Group Shareholders' complaint alleges that VisionChina Media and Vision Best breached certain agreements related to the Company's acquisition of Digital Media Group, by allegedly declining to make certain installment payments that the Former Digital Media Group Shareholders claim they were entitled to receive, and allegedly declining to take other steps to facilitate the transfer of Company stock that the Former Digital Media Group Shareholders are entitled to receive in connection with the acquisition.  According to the complaint, the Former Digital Media Group Shareholders are seeking specific enforcement of the contracts at issue, compensatory damages in an amount to be determined at trial, permanent and preliminary injunctive relief and such other relief as the court deems just and proper.  

Also on February 25, 2011, the Former Digital Media Group Shareholders filed two motions against VisionChina Media and Vision Best in their newly-filed lawsuit.  They submitted a motion for attachment, seeking an order of attachment in the amount of $30 million against VisionChina Media and Vision Best and directing them to transfer assets into the State of New York to satisfy a prospective judgment.  They also filed a motion in the new lawsuit for a preliminary injunction, seeking a preliminary order that VisionChina Media and Vision Best remove the restrictive legend on certain VisionChina Media stock received by the Former Digital Media Group Shareholders in connection with the acquisition, and provide consents or authorizations required to convert the Company's stock that the Former Digital Media Group Shareholders are entitled to receive to American Depository Shares and make them freely tradable.

The Company and Vision Best believe that the Former Digital Media Group Shareholders' claims and related motions are without merit and intend to vigorously defend the claims and oppose the motions.  The motions are scheduled to be presented for the New York court's consideration on March 15, 2011.

BEIJING, Dec. 28, 2010 /PRNewswire-Asia/ -- VisionChina Media Inc. today announced that it, together with its wholly-owned subsidiary Vision Best Limited ("Vision Best"), commenced an action on December 27, 2010 against Shareholder Representative Services, LLC, Gobi Partners, INC., Gobi Fund, INC., Gobi Fund II, L.P., Oak Investment Partners XII, L.P., Sierra Ventures IX, LP, NIFSMBC-V2006S1 Investment Limited Partnership, NIFSMBC-V2006S3 Investment Limited Partnership, Thomas Gai Tei Tsao, and other as-yet unnamed defendants, arising from VisionChina Media's November 16, 2009 acquisition of Digital Media Group Company Limited. ("Digital Media Group"), by filing a summons with notice in the Supreme Court of the State of New York, New York County.

The summons and notice alleges that defendants Gobi Partners, Inc., Gobi Fund, Inc., Gobi Fund II, L.P. (collectively, "Gobi"), Oak Investment Partners XII, L.P. ("Oak"), Thomas Gai Tei Tsao and other as-yet unnamed participants engaged in an unlawful scheme to induce VisionChina Media and Vision Best, through false, deceptive, and misleading statements concerning Digital Media Group's financial condition and performance, to pay a grossly inflated price to purchase Digital Media Group's shares. The summons and notice alleges that each defendant named in the action has received, or is scheduled to receive, ill-gotten gains from this unlawful scheme. The summons and notice further alleges that VisionChina Media and Vision Best are owed indemnification from an escrow fund, established at the time of the purchase, as a result of breaches of representations and warranties contained in the merger agreement.

Key Quarterly Financial and Operating Data for the Third Quarter of 2010

• Total revenues in the third quarter of 2010 were $37.9 million.
• Gross profit in the third quarter of 2010 was $6.8 million.
• Operating loss in the third quarter of 2010 was $1.8 million.
• Net loss attributable to VisionChina Media shareholders in the third quarter of 2010 was $1.9 million.
• Net income attributable to VisionChina Media shareholders in the third quarter of 2010, excluding share-based compensation expenses and amortization of intangible assets (non-GAAP), was $1.1 million.

Business outlook

The Company estimates total revenues, which consist of advertising service revenue only, in the fourth quarter of 2010 to be between $41.1 million and $44.0 million. Fourth quarter 2010 net income attributable to VisionChina Media shareholders excluding share-based compensation expenses and amortization of intangible assets (non-GAAP) is estimated to be between $1.3 million and $3.5 million.

These estimates are based on an exchange rate of RMB6.6981 per $1.00.

The Company noted that its guidance is based on its current network of 23 cities that, as of the date of this press release, has already been secured by contracts. If the Company's network expands to additional cities, either organically or through acquisitions, management's forecast could be affected.