Company News
Mr.
Mr.
First Quarter 2021 Financial Results
As disclosed in the second quarter 2020 unaudited financial results announcement made on
REVENUES
Total revenues in the first quarter of 2021 decreased by 2.3% to
Net advertising revenues in the first quarter of 2021 decreased by 3.5% to
Paid services revenues[1] in the first quarter of 2021 increased by 9.3% to
COST OF REVENUES
Cost of revenues in the first quarter of 2021 increased by 2.7% to
- Content and operational costs in the first quarter of 2021 increased by 5.4% to
RMB91.7 million (US$14.0 million ) fromRMB87.0 million in the same period of 2020, mainly caused by the resumption of normal operations in the first quarter of 2021 as compared to decreased operational activities in the same period of 2020 due to COVID-19 impact inChina at that time. Share-based compensation included in the content and operational costs in the first quarter of 2021 decreased toRMB0.3 million (US$0.05 million ) fromRMB1.1 million in the same period of 2020.
The increase was partially offset by the following:
- Revenue sharing fees in the first quarter of 2021 decreased by 39.5% to
RMB2.6 million (US$0.4 million ) fromRMB4.3 million in the same period of 2020, mainly due to the decrease in revenue sharing fees paid to telecom operators. - Bandwidth costs in the first quarter of 2021 decreased slightly to
RMB13.8 million (US$2.1 million ) fromRMB14.0 million in the same period of 2020.
GROSS PROFIT
Gross profit in the first quarter of 2021 decreased by 6.4% to
To supplement the financial measures presented in accordance with the United States Generally Accepted Accounting Principles ("GAAP"), the Company has presented certain non-GAAP financial measures in this press release, which excluded the impact of certain reconciling items as stated in the "Use of Non-GAAP Financial Measures" section below. The related reconciliations to GAAP financial measures are presented in the accompanying "Reconciliations of Non-GAAP Results of Operation Measures to the Nearest Comparable GAAP Measures."
Non-GAAP gross margin in the first quarter of 2021, excluding share-based compensation, decreased to 52.3% from 55.0% in the same period of 2020.
OPERATING EXPENSES AND LOSS FROM OPERATIONS
Total operating expenses in the first quarter of 2021 decreased by 18.8% to
Loss from operations in the first quarter of 2021 was
Non-GAAP loss from operations in the first quarter of 2021, which excluded share-based compensation, was
OTHER INCOME OR LOSS
Other income or loss reflects net interest income, foreign currency exchange gain or loss, income or loss from equity method investments, net of impairment, changes in fair value of forward contract in relation to disposal of investments in Particle and others, net[2]. Total net other income in the first quarter of 2021 was
- Net interest income in the first quarter of 2021 increased to
RMB10.7 million (US$1.6 million ) fromRMB6.4 million in the same period of 2020. - Foreign currency exchange loss in the first quarter of 2021 was
RMB2.8 million (US$0.4 million ), compared toRMB1.7 million in the same period of 2020. - Loss from equity method investments, net of impairment, in the first quarter of 2021 was
RMB0.1 million (US$0.02 million ), compared toRMB0.2 million in the same period of 2020. - Changes in fair value of forward contract in relation to disposal of investments in Particle in the first quarter of 2021 was nil, compared to a gain of
RMB14.7 million in the same period of 2020. - Others, net, in the first quarter of 2021 decreased to
RMB4.7 million (US$0.7 million ), fromRMB5.1 million in the same period of 2020.
NET LOSS FROM CONTINUING OPERATIONS ATTRIBUTABLE TO
Net loss from continuing operations attributable to
Non-GAAP net loss from continuing operations attributable to
In the first quarter of 2021, the Company's weighted average number of ADSs used in the computation of diluted net loss per ADS was 72,790,541. As of
CERTAIN BALANCE SHEET ITEMS
As of
Business Outlook
For the second quarter of 2021, the Company expects its total revenues to be between
All of the above forecasts reflect the current and preliminary view of the Company's management, which are subject to change and substantial uncertainty, particularly in view of the potential impact of the COVID-19 outbreak, the effects of which are difficult to analyse and predict.
Conference Call Information
The Company will hold a conference call at 9:00 p.m. U.
To participate in the call, please register in advance of the conference by navigating to http://apac.directeventreg.com/registration/event/2227658. Upon registering, you will be provided with participant dial-in numbers, Direct Event passcode and unique registrant ID by email. Please dial in 10 minutes prior to the call, using the participant dial-in numbers, Direct Event Passcode and unique registrant ID which would be provided upon registering. You will be automatically linked to the live call after completion of this process.
A replay of the call will be available through
International: |
+61 2 8199 0299 |
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Mainland |
4006322162 |
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+852 30512780 |
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+1 646 254 3697 |
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Conference ID: |
2227658 |
A live and archived webcast of the conference call will also be available at the Company's investor relations website at http://ir.ifeng.com.
Use of Non-GAAP Financial Measures
To supplement the consolidated financial statements presented in accordance with the United States Generally Accepted Accounting Principles ("GAAP"),
Exchange Rate
This announcement contains translations of certain RMB amounts into
About
Safe Harbor Statement
This announcement contains forward−looking statements. These statements are made under the "safe harbor" provisions of the
For investor and media inquiries please contact:
Email: investorrelations@ifeng.com
ICR, Inc.
Tel: +1 (646) 405-4883
Email: investorrelations@ifeng.com
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Condensed Consolidated Balance Sheets |
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(Amounts in thousands) |
||||||
|
|
|
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2020* |
2021 |
2021 |
||||
RMB |
RMB |
US$ |
||||
Audited |
Unaudited |
Unaudited |
||||
ASSETS |
||||||
Current assets: |
||||||
Cash and cash equivalents |
357,796 |
393,550 |
60,067 |
|||
Term deposits and short term investments |
1,280,033 |
1,159,786 |
177,018 |
|||
Restricted cash |
31,039 |
25,093 |
3,830 |
|||
Accounts receivable, net |
675,616 |
578,900 |
88,357 |
|||
Amounts due from related parties |
32,587 |
34,859 |
5,321 |
|||
Prepayment and other current assets |
42,846 |
48,602 |
7,418 |
|||
Total current assets |
2,419,917 |
2,240,790 |
342,011 |
|||
Non-current assets: |
||||||
Property and equipment, net |
62,649 |
56,437 |
8,614 |
|||
Intangible assets, net |
12,396 |
12,347 |
1,885 |
|||
Available-for-sale debt investments |
36,662 |
35,150 |
5,365 |
|||
Equity investments, net |
94,821 |
108,714 |
16,593 |
|||
Deferred tax assets |
86,867 |
89,140 |
13,605 |
|||
Operating lease right-of- use assets, net |
49,487 |
42,466 |
6,482 |
|||
Other non-current assets |
9,753 |
9,293 |
1,418 |
|||
Total non-current assets |
352,635 |
353,547 |
53,962 |
|||
Total assets |
2,772,552 |
2,594,337 |
395,973 |
|||
LIABILITIES AND SHAREHOLDERS' EQUITY |
||||||
Current liabilities: |
||||||
Accounts payable |
221,203 |
201,052 |
30,687 |
|||
Amounts due to related parties |
34,420 |
32,784 |
5,004 |
|||
Advances from customers |
38,835 |
36,528 |
5,575 |
|||
Taxes payable |
402,610 |
397,725 |
60,705 |
|||
Salary and welfare payable |
156,599 |
88,707 |
13,539 |
|||
Accrued expenses and other current liabilities |
172,376 |
129,611 |
19,782 |
|||
Operating lease liabilities |
36,370 |
32,385 |
4,943 |
|||
Total current liabilities |
1,062,413 |
918,792 |
140,235 |
|||
Non-current liabilities: |
||||||
Deferred tax liabilities |
1,312 |
1,312 |
200 |
|||
Long-term liabilities |
28,182 |
28,182 |
4,301 |
|||
Operating lease liabilities |
16,672 |
10,174 |
1,553 |
|||
Total non-current liabilities |
46,166 |
39,668 |
6,054 |
|||
Total liabilities |
1,108,579 |
958,460 |
146,289 |
|||
Shareholders' equity: |
||||||
|
||||||
Class A ordinary shares |
17,499 |
17,499 |
2,671 |
|||
Class B ordinary shares |
22,053 |
22,053 |
3,366 |
|||
Additional paid-in capital |
1,620,580 |
1,621,904 |
247,551 |
|||
Statutory reserves |
92,017 |
92,017 |
14,045 |
|||
Accumulated deficit |
(88,191) |
(117,364) |
(17,914) |
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Accumulated other comprehensive loss |
(28,214) |
(27,927) |
(4,262) |
|||
|
1,635,744 |
1,608,182 |
245,457 |
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Noncontrolling interests |
28,229 |
27,695 |
4,227 |
|||
Total shareholders' equity |
1,663,973 |
1,635,877 |
249,684 |
|||
Total liabilities and shareholders' equity |
2,772,552 |
2,594,337 |
395,973 |
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* Derived from audited financial statements included in the Company's Form 20-F dated |
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Condensed Consolidated Statements of Comprehensive Income/(loss) |
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(Amounts in thousands, except for number of shares and per share (or ADS) data) |
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Three Months Ended |
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|
|
|
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2020 |
2020 |
2021 |
2021 |
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RMB |
RMB |
RMB |
US$ |
||||
Revenues: |
|||||||
Net advertising revenues |
208,710 |
336,653 |
201,313 |
30,726 |
|||
Paid service revenues |
22,666 |
25,546 |
24,778 |
3,782 |
|||
Total revenues |
231,376 |
362,199 |
226,091 |
34,508 |
|||
Cost of revenues |
(105,298) |
(179,224) |
(108,104) |
(16,500) |
|||
Gross profit |
126,078 |
182,975 |
117,987 |
18,008 |
|||
Operating expenses: |
|||||||
Sales and marketing expenses |
(81,623) |
(75,660) |
(64,843) |
(9,898) |
|||
General and administrative expenses |
(70,272) |
(70,716) |
(54,828) |
(8,368) |
|||
Technology and product development expenses |
(45,111) |
(42,617) |
(40,275) |
(6,147) |
|||
Impairment of goodwill |
- |
(22,786) |
- |
- |
|||
Total operating expenses |
(197,006) |
(211,779) |
(159,946) |
(24,413) |
|||
Loss from operations |
(70,928) |
(28,804) |
(41,959) |
(6,405) |
|||
Other income/(loss): |
|||||||
Interest income, net |
6,402 |
9,309 |
10,740 |
1,639 |
|||
Foreign currency exchange (loss)/gain |
(1,728) |
3,921 |
(2,765) |
(422) |
|||
Loss from equity method investments, net of |
(236) |
(179) |
(107) |
(16) |
|||
Gain on disposal of available-for-sale debt |
- |
477,254 |
- |
- |
|||
Changes in fair value of forward contract in relation to |
14,744 |
- |
- |
- |
|||
Others, net |
5,116 |
8,770 |
4,670 |
713 |
|||
(Loss)/income from continuing operations before |
(46,630) |
470,271 |
(29,421) |
(4,491) |
|||
Income tax benefit/(expense) |
757 |
(14,793) |
(250) |
(38) |
|||
Net (loss)/income from continuing operations |
(45,873) |
455,478 |
(29,671) |
(4,529) |
|||
Net loss from discontinued operations, net of |
(44,497) |
- |
- |
- |
|||
Net (loss)/income |
(90,370) |
455,478 |
(29,671) |
(4,529) |
|||
Net loss/(income) attributable to noncontrolling |
|||||||
Net loss/(income) from continuing operations |
7,254 |
(700) |
498 |
76 |
|||
Net loss from discontinued operations attributable to |
22,875 |
- |
- |
- |
|||
Net loss/(income) attributable to noncontrolling |
30,129 |
(700) |
498 |
76 |
|||
Net (loss)/income attributable to |
|||||||
Net (loss)/income from continuing operations |
(38,619) |
454,778 |
(29,173) |
(4,453) |
|||
Net loss from discontinued operations attributable to |
(21,622) |
- |
- |
- |
|||
Net (loss)/income attributable to |
(60,241) |
454,778 |
(29,173) |
(4,453) |
|||
Net (loss)/income |
(90,370) |
455,478 |
(29,671) |
(4,529) |
|||
Other comprehensive loss, net of tax: fair value |
- |
(2,736) |
(1,730) |
(264) |
|||
Other comprehensive loss, net of tax: reclassification |
- |
(491,197) |
- |
- |
|||
Other comprehensive income/(loss), net of tax: foreign |
30,428 |
(41,326) |
2,017 |
308 |
|||
Comprehensive loss |
(59,942) |
(79,781) |
(29,384) |
(4,485) |
|||
Comprehensive loss/(income) attributable to |
30,129 |
(700) |
498 |
76 |
|||
Comprehensive loss attributable to |
(29,813) |
(80,481) |
(28,886) |
(4,409) |
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Basic net (loss)/income per Class A and Class B |
|||||||
-Continuing operations |
(0.07) |
0.78 |
(0.05) |
(0.01) |
|||
-Discontinued operations |
(0.03) |
- |
- |
- |
|||
Basic net (loss)/income per Class A and Class B |
(0.10) |
0.78 |
(0.05) |
(0.01) |
|||
Diluted net (loss)/income per Class A and Class B |
|||||||
-Continuing operations |
(0.07) |
0.78 |
(0.05) |
(0.01) |
|||
-Discontinued operations |
(0.03) |
- |
- |
- |
|||
Diluted net (loss)/income per Class A and Class B |
(0.10) |
0.78 |
(0.05) |
(0.01) |
|||
Basic (loss)/income per ADS (1 ADS represents 8 |
|||||||
-Continuing operations |
(0.53) |
6.25 |
(0.40) |
(0.06) |
|||
-Discontinued operations |
(0.30) |
- |
- |
- |
|||
Basic net (loss)/income per ADS (1 ADS represents |
(0.83) |
6.25 |
(0.40) |
(0.06) |
|||
Diluted net (loss)/income per ADS (1 ADS |
|||||||
-Continuing operations |
(0.53) |
6.25 |
(0.40) |
(0.06) |
|||
-Discontinued operations |
(0.30) |
- |
- |
- |
|||
Diluted net (loss)/income per ADS (1 ADS |
(0.83) |
6.25 |
(0.40) |
(0.06) |
|||
Weighted average number of Class A and Class B |
|||||||
Basic |
582,324,325 |
582,324,325 |
582,324,325 |
582,324,325 |
|||
Diluted |
582,324,325 |
582,324,325 |
582,324,325 |
582,324,325 |
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Condensed Segments Information |
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(Amounts in thousands) |
|||||||
Three Months Ended |
|||||||
|
|
|
|
||||
2020 |
2020 |
2021 |
2021 |
||||
RMB |
RMB |
RMB |
US$ |
||||
Unaudited |
Unaudited |
Unaudited |
Unaudited |
||||
Revenues: |
|||||||
Net advertising service |
208,710 |
336,653 |
201,313 |
30,726 |
|||
Paid services |
22,666 |
25,546 |
24,778 |
3,782 |
|||
Total revenues |
231,376 |
362,199 |
226,091 |
34,508 |
|||
Cost of revenues |
|||||||
Net advertising service |
97,233 |
165,581 |
101,255 |
15,455 |
|||
Paid services |
8,065 |
13,643 |
6,849 |
1,045 |
|||
Total cost of revenues |
105,298 |
179,224 |
108,104 |
16,500 |
|||
Gross profit |
|||||||
Net advertising service |
111,477 |
171,072 |
100,058 |
15,271 |
|||
Paid services |
14,601 |
11,903 |
17,929 |
2,737 |
|||
Total gross profit |
126,078 |
182,975 |
117,987 |
18,008 |
|
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Condensed Information of Cost of Revenues |
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(Amounts in thousands) |
|||||||
Three Months Ended |
|||||||
|
|
|
|
||||
2020 |
2020 |
2021 |
2021 |
||||
RMB |
RMB |
RMB |
US$ |
||||
Unaudited |
Unaudited |
Unaudited |
Unaudited |
||||
Revenue sharing fees |
4,256 |
6,897 |
2,571 |
392 |
|||
Content and operational costs |
87,030 |
158,458 |
91,717 |
13,999 |
|||
Bandwidth costs |
14,012 |
13,869 |
13,816 |
2,109 |
|||
Total cost of revenues |
105,298 |
179,224 |
108,104 |
16,500 |
Reconciliations of Non-GAAP Results of Operations Measures to the Nearest Comparable GAAP Measures |
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(Amounts in thousands, except for number of ADSs and per ADS data) |
|||||||||||||||||
Three Months Ended |
Three Months Ended |
Three Months Ended |
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GAAP |
Non-GAAP |
Non- |
GAAP |
Non-GAAP |
Non- |
GAAP |
Non-GAAP |
Non- |
|||||||||
RMB |
RMB |
RMB |
RMB |
RMB |
RMB |
RMB |
RMB |
RMB |
|||||||||
Unaudited |
Unaudited |
Unaudited |
Unaudited |
Unaudited |
Unaudited |
Unaudited |
Unaudited |
Unaudited |
|||||||||
Gross profit |
126,078 |
1,141 |
(1) |
127,219 |
182,975 |
229 |
(1) |
183,204 |
117,987 |
268 |
(1) |
118,255 |
|||||
Gross margin |
54.5% |
55.0% |
50.5% |
50.6% |
52.2% |
52.3% |
|||||||||||
2,666 |
(1) |
2,734 |
(1) |
1,288 |
(1) |
||||||||||||
- |
(2) |
22,786 |
(2) |
- |
(2) |
||||||||||||
Loss from operations |
(70,928) |
2,666 |
(68,262) |
(28,804) |
25,520 |
(3,284) |
(41,959) |
1,288 |
(40,671) |
||||||||
Operating margin |
(30.7)% |
(29.5)% |
(8.0)% |
(0.9)% |
(18.6)% |
(18.0)% |
|||||||||||
2,666 |
(1) |
2,734 |
(1) |
1,288 |
(1) |
||||||||||||
- |
(2) |
22,786 |
(2) |
- |
(2) |
||||||||||||
236 |
(3) |
179 |
(3) |
107 |
(3) |
||||||||||||
- |
(4) |
(573,860) |
(4) |
- |
(4) |
||||||||||||
(14,744) |
(5) |
- |
(5) |
- |
(5) |
||||||||||||
- |
(6) |
(11,393) |
(6) |
- |
(6) |
||||||||||||
- |
(7) |
96,606 |
(7) |
- |
(7) |
||||||||||||
Net (loss)/income from continuing |
(38,619) |
(11,842) |
(50,461) |
454,778 |
(462,948) |
(8,170) |
(29,173) |
1,395 |
(27,778) |
||||||||
Net margin |
(16.7)% |
(21.8)% |
125.6% |
(2.3)% |
(12.9)% |
(12.3)% |
|||||||||||
Net (loss)/income per ADS-diluted |
(0.53) |
(0.69) |
6.25 |
(0.11) |
(0.40) |
(0.38) |
|||||||||||
Weighted average number of ADSs used i |
72,790,541 |
72,790,541 |
72,790,541 |
72,790,541 |
72,790,541 |
72,790,541 |
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(1) Share-based compensation |
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(2) Impairment of goodwill |
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(3) Loss/(income) from equity method investments |
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(4) Gain on disposal of available-for-sale debt investments |
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(5) Changes in fair value of forward contract in relation to disposal of investments in Particle |
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(6) Loss attributable to noncontrolling interest related to item (2) |
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(7) Accrued withholding taxes of item (4). Other non-GAAP to GAAP reconciling items have no income tax effect. |
[1] Prior to 2021, paid services revenues comprised of (i) revenues from paid contents, which included digital reading, audio books, paid videos, and other content-related sales activities, (ii) revenues from games, which included web-based games and mobile games, (iii) revenues from MVAS, and (iv) revenues from others. As revenues from games and revenues from MVAS were small and had been declining for the past years, to better reflect the Company's paid services revenues disaggregated by products and services, beginning from |
[2] "Others, net" primarily consists of government subsidies and litigation loss provisions. |
[3] "ADS" means American Depositary Share of the Company. Each ADS represents eight Class A ordinary shares of the Company. |
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