Company News
"We are pleased to announce better than expected financial and operating performances during the second quarter of 2017," stated Mr.
Mr. Ya Li, co-president of
[1] The Company has accounted for its investments in Yidian as available-for-sale investments. |
Second Quarter 2017 Financial Results
REVENUES
Total revenues for the second quarter of 2017 increased by 12.3% to
Net advertising revenues (net of advertising agency service fees) for the second quarter of 2017 increased by 14.0% to
Paid services revenues[2] for the second quarter of 2017 increased by 3.2% to
[2] Prior to 2016, the Company's paid services revenues comprised mainly of revenues generated from MVAS and games and others. Digital reading was previously classified under "games and others." In order to align with the Company's overall strategies, digital reading was re-classified from "games and others" and digital reading together with MVAS was determined as "digital entertainment" starting from the financial statements as of and for the year ended December 31, 2016. Accordingly, the revenues from digital entertainment and the revenues from games and others for the first two quarters of 2016 have been reclassified. |
[3] Digital entertainment includes MVAS and digital reading. MVAS includes mobile newspaper services, mobile video services, mobile game services, and wireless value-added services, or WVAS. |
[4] Games and others include web-based and mobile games, and other online and mobile paid services through the Company's own platforms. |
COST OF REVENUES
Cost of revenues for the second quarter of 2017 decreased by 7.0% to
GROSS PROFIT
Gross profit for the second quarter of 2017 increased by 32.9% 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 for the second quarter of 2017, which excluded share-based compensation, increased to 57.6% from 48.7% in the second quarter of 2016.
OPERATING EXPENSES AND INCOME/(LOSS) FROM OPERATIONS
Total operating expenses for the second quarter of 2017 increased by 7.4% to
Income from operations for the second quarter of 2017 was
Non-GAAP income from operations for the second quarter of 2017, which excluded share-based compensation, was
OTHER INCOME/(LOSS)
Other income/(loss) reflects interest income, interest expense, foreign currency exchange gain/(loss), gain/(loss) from equity investments, including impairments, and others, net[5]. Total other income for the second quarter of 2017 was
[5] "Others, net" primarily consists of government subsidies. |
NET INCOME/(LOSS) ATTRIBUTABLE TO PHOENIX NEW MEDIA LIMITED
Net income attributable to
Non-GAAP net income attributable to
For the second quarter of 2017, the Company's weighted average number of ADSs used in the computation of diluted net income per ADS was 72,101,949. As of
[6] "ADS" means American Depositary Share of the Company. Each ADS represents eight Class A ordinary shares of the Company. |
OTHER COMPREHENSIVE INCOME
In
CERTAIN BALANCE SHEET ITEMS
As of
Business Outlook
For the third quarter of 2017, the Company expects its total revenues to be between
Conference Call Information
The Company will hold a conference call at
To participate in the call, please use the dial-in numbers and conference ID below:
International: |
+6567135440 |
Mainland China: |
4001200654 |
Hong Kong: |
+85230186776 |
United States: |
+18456750438 |
Conference ID: |
68225619 |
A replay of the call will be available through
International: |
+61290034211 |
Mainland China: |
4006322162 |
Hong Kong: |
+85230512780 |
United States: |
+16462543697 |
Conference ID: |
68225619 |
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 U.S. dollars ("USD") at specified rates solely for the convenience of the reader. Unless otherwise stated, all translations from RMB to USD were made at the rate of
About Phoenix New Media Limited
Safe Harbor Statement
This announcement contains forward−looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward−looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Among other things, the business outlook and quotations from management in this announcement, as well as
For investor and media inquiries please contact:
Email: investorrelations@ifeng.com
Rose Zu
Tel: +1 (646) 405-4883
Email: investorrelations@ifeng.com
Phoenix New Media Limited |
|||||
Condensed Consolidated Balance Sheets |
|||||
(Amounts in thousands) |
|||||
December 31, |
June 30, |
June 30, |
|||
2016 |
2017 |
2017 |
|||
RMB |
RMB |
US$ |
|||
Audited* |
Unaudited |
Unaudited |
|||
ASSETS |
|||||
Current assets: |
|||||
Cash and cash equivalents |
202,694 |
227,460 |
33,552 |
||
Term deposits and short term investments |
781,298 |
499,236 |
73,641 |
||
Restricted cash |
354,602 |
465,707 |
68,695 |
||
Accounts receivable, net |
405,033 |
380,071 |
56,063 |
||
Amounts due from related parties |
156,260 |
267,534 |
39,464 |
||
Prepayment and other current assets |
64,069 |
58,619 |
8,647 |
||
Convertible loans due from a related party |
104,429 |
104,250 |
15,378 |
||
Total current assets |
2,068,385 |
2,002,877 |
295,440 |
||
Non-current assets: |
|||||
Property and equipment, net |
72,087 |
73,870 |
10,896 |
||
Intangible assets, net |
9,475 |
8,376 |
1,236 |
||
Available-for-sale investments |
939,432 |
1,182,730 |
174,462 |
||
Equity investments, net |
8,809 |
9,272 |
1,368 |
||
Deferred tax assets** |
54,307 |
59,704 |
8,807 |
||
Other non-current assets |
16,047 |
13,267 |
1,957 |
||
Total non-current assets |
1,100,157 |
1,347,219 |
198,726 |
||
Total assets |
3,168,542 |
3,350,096 |
494,166 |
||
LIABILITIES AND SHAREHOLDERS' EQUITY |
|||||
Current liabilities: |
|||||
Short-term bank loans |
358,602 |
357,954 |
52,801 |
||
Accounts payable |
260,902 |
218,318 |
32,204 |
||
Amounts due to related parties |
18,720 |
20,164 |
2,974 |
||
Advances from customers |
27,825 |
49,378 |
7,284 |
||
Taxes payable |
75,652 |
65,150 |
9,610 |
||
Salary and welfare payable |
130,329 |
103,508 |
15,268 |
||
Accrued expenses and other current liabilities |
111,049 |
95,852 |
14,139 |
||
Total current liabilities |
983,079 |
910,324 |
134,280 |
||
Non-current liabilities: |
|||||
Deferred tax liabilities |
1,312 |
1,312 |
194 |
||
Long-term liabilities |
21,723 |
21,890 |
3,229 |
||
Total non-current liabilities |
23,035 |
23,202 |
3,423 |
||
Total liabilities |
1,006,114 |
933,526 |
137,703 |
||
Shareholders' equity: |
|||||
Phoenix New Media Limited shareholders' equity: |
|||||
Class A ordinary shares |
16,843 |
16,846 |
2,485 |
||
Class B ordinary shares |
22,053 |
22,053 |
3,253 |
||
Additional paid-in capital |
1,555,511 |
1,569,222 |
231,473 |
||
Statutory reserves |
77,946 |
77,946 |
11,498 |
||
Retained earnings |
195,069 |
187,826 |
27,706 |
||
Accumulated other comprehensive income |
298,346 |
547,572 |
80,770 |
||
Total Phoenix New Media Limited shareholders' equity |
2,165,768 |
2,421,465 |
357,185 |
||
Noncontrolling interests |
(3,340) |
(4,895) |
(722) |
||
Total shareholders' equity |
2,162,428 |
2,416,570 |
356,463 |
||
Total liabilities and shareholders' equity |
3,168,542 |
3,350,096 |
494,166 |
||
* Derived from audited financial statements included in the Company's Form 20-F dated April 28, 2017. |
|||||
** In 2017, the Company adopted the guidance of ASU 2015-17 issued by FASB in November 2015, which |
Phoenix New Media Limited |
|||||||||||||
Condensed Consolidated Statements of Comprehensive Income |
|||||||||||||
(Amounts in thousands, except for number of shares and per share (or ADS) data) |
|||||||||||||
Three Months Ended |
Six Months Ended |
||||||||||||
June 30, |
March 31, |
June 30, |
June 30, |
June 30, |
June 30, |
June 30, |
|||||||
2016 |
2017 |
2017 |
2017 |
2016 |
2017 |
2017 |
|||||||
RMB |
RMB |
RMB |
US$ |
RMB |
RMB |
US$ |
|||||||
Unaudited |
Unaudited |
Unaudited |
Unaudited |
Unaudited |
Unaudited |
Unaudited |
|||||||
Revenues: |
|||||||||||||
Net advertising revenues |
297,230 |
241,084 |
338,725 |
49,965 |
568,613 |
579,809 |
85,526 |
||||||
Paid service revenues |
52,833 |
53,395 |
54,541 |
8,045 |
104,390 |
107,936 |
15,921 |
||||||
Total revenues |
350,063 |
294,479 |
393,266 |
58,010 |
673,003 |
687,745 |
101,447 |
||||||
Cost of revenues |
(180,508) |
(162,489) |
(167,844) |
(24,758) |
(338,676) |
(330,333) |
(48,727) |
||||||
Gross profit |
169,555 |
131,990 |
225,422 |
33,252 |
334,327 |
357,412 |
52,720 |
||||||
Operating expenses: |
|||||||||||||
Sales and marketing expenses |
(87,017) |
(95,462) |
(118,769) |
(17,519) |
(162,575) |
(214,231) |
(31,601) |
||||||
General and administrative expenses |
(57,587) |
(31,951) |
(35,865) |
(5,290) |
(102,630) |
(67,816) |
(10,003) |
||||||
Technology and product development |
(42,074) |
(44,628) |
(45,791) |
(6,755) |
(82,432) |
(90,419) |
(13,338) |
||||||
Total operating expenses |
(186,678) |
(172,041) |
(200,425) |
(29,564) |
(347,637) |
(372,466) |
(54,942) |
||||||
(Loss)/income from operations |
(17,123) |
(40,051) |
24,997 |
3,688 |
(13,310) |
(15,054) |
(2,222) |
||||||
Other income/(loss): |
|||||||||||||
Interest income |
8,257 |
12,658 |
13,493 |
1,990 |
16,384 |
26,151 |
3,857 |
||||||
Interest expense |
(954) |
(6,349) |
(6,426) |
(948) |
(1,728) |
(12,775) |
(1,884) |
||||||
Foreign currency exchange gain/(loss) |
2,411 |
(2,311) |
(7,890) |
(1,164) |
547 |
(10,201) |
(1,505) |
||||||
(Loss)/gain from equity investments, |
(1,512) |
(664) |
1,127 |
166 |
(505) |
463 |
68 |
||||||
Others, net |
4,220 |
1,427 |
3,066 |
452 |
8,426 |
4,493 |
663 |
||||||
(Loss)/income before tax |
(4,701) |
(35,290) |
28,367 |
4,184 |
9,814 |
(6,923) |
(1,023) |
||||||
Income tax benefit /(expense) |
1,442 |
2,341 |
(4,215) |
(622) |
(1,957) |
(1,874) |
(276) |
||||||
Net (loss)/income |
(3,259) |
(32,949) |
24,152 |
3,562 |
7,857 |
(8,797) |
(1,299) |
||||||
Net loss attributable to noncontrolling |
778 |
775 |
779 |
115 |
1,280 |
1,554 |
229 |
||||||
Net (loss)/income attributable to Phoenix |
(2,481) |
(32,174) |
24,931 |
3,677 |
9,137 |
(7,243) |
(1,070) |
||||||
Net (loss)/income |
(3,259) |
(32,949) |
24,152 |
3,562 |
7,857 |
(8,797) |
(1,299) |
||||||
Other comprehensive income, net of tax: |
11,329 |
8,891 |
256,588 |
37,849 |
16,643 |
265,479 |
39,160 |
||||||
Other comprehensive income/(loss), net |
11,002 |
(3,767) |
(12,486) |
(1,842) |
8,934 |
(16,253) |
(2,397) |
||||||
Comprehensive income/(loss) |
19,072 |
(27,825) |
268,254 |
39,569 |
33,434 |
240,429 |
35,464 |
||||||
Comprehensive loss attributable to |
778 |
775 |
779 |
115 |
1,280 |
1,554 |
229 |
||||||
Comprehensive income/(loss) attributable |
19,850 |
(27,050) |
269,033 |
39,684 |
34,714 |
241,983 |
35,693 |
||||||
Net (loss)/income attributable to Phoenix |
(2,481) |
(32,174) |
24,931 |
3,677 |
9,137 |
(7,243) |
(1,070) |
||||||
Net (loss)/income per Class A and Class B |
|||||||||||||
Basic |
(0.00) |
(0.06) |
0.04 |
0.01 |
0.02 |
(0.01) |
0.00 |
||||||
Diluted |
(0.00) |
(0.06) |
0.04 |
0.01 |
0.02 |
(0.01) |
0.00 |
||||||
Net (loss)/income per ADS (1 ADS |
|||||||||||||
Basic |
(0.03) |
(0.45) |
0.35 |
0.05 |
0.13 |
(0.10) |
(0.01) |
||||||
Diluted |
(0.03) |
(0.45) |
0.35 |
0.05 |
0.13 |
(0.10) |
(0.01) |
||||||
Weighted average number of Class A and |
|||||||||||||
Basic |
573,074,298 |
573,935,277 |
573,948,891 |
573,948,891 |
573,035,634 |
573,943,337 |
573,943,337 |
||||||
Diluted |
573,074,298 |
573,935,277 |
576,815,588 |
576,815,588 |
577,318,340 |
573,943,337 |
573,943,337 |
Phoenix New Media Limited |
|||||||||||||
Condensed Segments Information |
|||||||||||||
(Amounts in thousands) |
|||||||||||||
Three Months Ended |
Six Months Ended |
||||||||||||
June 30, |
March 31, |
June 30, |
June 30, |
June 30, |
June 30, |
June 30, |
|||||||
2016 |
2017 |
2017 |
2017 |
2016 |
2017 |
2017 |
|||||||
RMB |
RMB |
RMB |
US$ |
RMB |
RMB |
US$ |
|||||||
Unaudited |
Unaudited |
Unaudited |
Unaudited |
Unaudited |
Unaudited |
Unaudited |
|||||||
Revenues: |
|||||||||||||
Net advertising service |
297,230 |
241,084 |
338,725 |
49,965 |
568,613 |
579,809 |
85,526 |
||||||
Paid service |
52,833 |
53,395 |
54,541 |
8,045 |
104,390 |
107,936 |
15,921 |
||||||
Total revenues |
350,063 |
294,479 |
393,266 |
58,010 |
673,003 |
687,745 |
101,447 |
||||||
Cost of revenues |
|||||||||||||
Net advertising service |
146,233 |
131,125 |
141,459 |
20,866 |
272,265 |
272,584 |
40,209 |
||||||
Paid service |
34,275 |
31,364 |
26,385 |
3,892 |
66,411 |
57,749 |
8,518 |
||||||
Total cost of revenues |
180,508 |
162,489 |
167,844 |
24,758 |
338,676 |
330,333 |
48,727 |
||||||
Gross profit |
|||||||||||||
Net advertising service |
150,997 |
109,959 |
197,266 |
29,099 |
296,348 |
307,225 |
45,317 |
||||||
Paid service |
18,558 |
22,031 |
28,156 |
4,153 |
37,979 |
50,187 |
7,403 |
||||||
Total gross profit |
169,555 |
131,990 |
225,422 |
33,252 |
334,327 |
357,412 |
52,720 |
Phoenix New Media Limited |
|||||||||||||
Condensed Information of Cost of Revenues |
|||||||||||||
(Amounts in thousands) |
|||||||||||||
Three Months Ended |
Six Months Ended |
||||||||||||
June 30, |
March 31, |
June 30, |
June 30, |
June 30, |
June 30, |
June 30, |
|||||||
2016 |
2017 |
2017 |
2017 |
2016 |
2017 |
2017 |
|||||||
RMB |
RMB |
RMB |
US$ |
RMB |
RMB |
US$ |
|||||||
Unaudited |
Unaudited |
Unaudited |
Unaudited |
Unaudited |
Unaudited |
Unaudited |
|||||||
Revenue sharing fees |
19,274 |
17,320 |
15,052 |
2,220 |
38,128 |
32,372 |
4,775 |
||||||
Content and operational costs |
117,190 |
106,316 |
105,984 |
15,633 |
212,640 |
212,300 |
31,315 |
||||||
Bandwidth costs |
15,291 |
14,528 |
13,607 |
2,007 |
32,637 |
28,135 |
4,150 |
||||||
Sales taxes and surcharges |
28,753 |
24,325 |
33,201 |
4,898 |
55,271 |
57,526 |
8,487 |
||||||
Total cost of revenues |
180,508 |
162,489 |
167,844 |
24,758 |
338,676 |
330,333 |
48,727 |
Reconciliations of Non-GAAP Results of Operations Measures to the Nearest Comparable GAAP Measures |
|||||||||||||||||||||||||||
(Amounts in thousands, except for number of ADSs and per ADS data) |
|||||||||||||||||||||||||||
Three Months Ended June 30, 2016 |
Three Months Ended March 31, 2017 |
Three Months Ended June 30, 2017 |
|||||||||||||||||||||||||
Non-GAAP |
Non-GAAP |
Non-GAAP |
|||||||||||||||||||||||||
GAAP |
Adjustments |
Non-GAAP |
GAAP |
Adjustments |
Non-GAAP |
GAAP |
Adjustments |
Non-GAAP |
|||||||||||||||||||
RMB |
RMB |
RMB |
RMB |
RMB |
RMB |
RMB |
RMB |
RMB |
|||||||||||||||||||
Unaudited |
Unaudited |
Unaudited |
Unaudited |
Unaudited |
Unaudited |
Unaudited |
Unaudited |
Unaudited |
|||||||||||||||||||
Gross profit |
169,555 |
845 |
(1) |
170,400 |
131,990 |
1,623 |
(1) |
133,613 |
225,422 |
1,224 |
(1) |
226,646 |
|||||||||||||||
Gross margin |
48.4% |
48.7% |
44.8% |
45.4% |
57.3% |
57.6% |
|||||||||||||||||||||
(Loss)/income from |
(17,123) |
4,453 |
(1) |
(12,670) |
(40,051) |
8,266 |
(1) |
(31,785) |
24,997 |
5,460 |
(1) |
30,457 |
|||||||||||||||
Operating margin |
-4.9% |
-3.6% |
-13.6% |
-10.8% |
6.4% |
7.7% |
|||||||||||||||||||||
4,453 |
(1) |
8,266 |
(1) |
5,460 |
(1) |
||||||||||||||||||||||
1,512 |
(2) |
664 |
(2) |
(1,127) |
(2) |
||||||||||||||||||||||
Net (loss)/income |
(2,481) |
5,965 |
3,484 |
(32,174) |
8,930 |
(23,244) |
24,931 |
4,333 |
29,264 |
||||||||||||||||||
Net margin |
-0.7% |
1.0% |
-10.9% |
-7.9% |
6.3% |
7.4% |
|||||||||||||||||||||
Net (loss)/income per |
(0.03) |
0.05 |
(0.45) |
(0.32) |
0.35 |
0.41 |
|||||||||||||||||||||
Weighted average |
71,634,287 |
72,161,557 |
71,741,910 |
71,741,910 |
72,101,949 |
72,101,949 |
|||||||||||||||||||||
(1) Share-based compensation |
|||||||||||||||||||||||||||
(2) Loss/(gain) from equity investments, including impairments |
View original content:http://www.prnewswire.com/news-releases/phoenix-new-media-reports-second-quarter-2017-unaudited-financial-results-300504503.html
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