Welcome!

News Feed Item

China Finance Online Reports 2012 Second Quarter and Six Months Unaudited Financial Results

BEIJING, Sept. 13, 2012 /PRNewswire/ -- China Finance Online Co. Limited ("China Finance Online", or the "Company", "we", "us" or "our") (NASDAQ GS: JRJC), a technology-driven, user-focused market leader in China providing vertically integrated financial information and services including news, data, analytics, securities investment advisory and brokerage-related services,

today announced its unaudited financial results for the second quarter and first six months ended June 30, 2012.

2012 Second Quarter Financial Summary

  • Net revenues were $8.1 million compared with $13.8 million for the second quarter of 2011 due to the challenging global and domestic macroeconomic environment and a weak Chinese stock market;
  • Gross profit was $5.5 million compared with $11.6 million for the second quarter of 2011;
  • Net loss attributable to China Finance Online was $2.6 million.

2012 First Six Months Financial Summary

  • Net revenues were $17.2 million compared with $28.7 million for the first six months of 2011;
  • Gross profit was $12.7 million compared with $24.3 million for the first six months of 2011;
  • Net loss attributable to China Finance Online was $3.8 million.

Key Developments

  • One of our PRC affiliates received the regulatory approval for mutual fund distribution in Mainland China.

2012 Second Quarter Results

Net revenues for the second quarter of 2012 were $8.1 million, compared with $13.8 million for the second quarter of 2011. A considerably challenging global and domestic macroeconomic environment and a downward-trending stock market in China continue to negatively impact our operating performance. The main sources of the Company's net revenues were subscription fees from individual customers, subscription fees from institutional customers, advertising revenues and revenues from brokerage-related services, which contributed 60%, 9%, 15% and 16% to total revenues respectively, compared with 80%, 5%, 9%, and 6%, respectively, for the comparable period in 2011. Revenues from subscription fees paid by individual customers decreased 56.2% year-over-year. The decrease is due to the Company's previously disclosed strategic transition; as part of the transition, the Company has ceased accepting new paid subscribers or renewals for its premium individual subscription service. Institutional subscription revenues increased 5.4% year-over-year to $0.8 million. Revenues from advertising were slightly up to $1.2 million from the second quarter of 2011. Revenues from brokerage-related services increased 57.5% year-over-year to $1.3 million.

For the second quarter of 2012, gross profit was $5.5 million compared with $11.6 million for the comparable period in 2011. Gross margin for the second quarter of 2012 was 68.5% compared with 84.3% for the second quarter of 2011. The year-over-year decrease in gross margin was mainly due to lower revenues.

General and administrative ("G&A") expenses for the second quarter of 2012 were $2.6 million, or 32.1% of net revenues, compared with $2.6 million, or 19.0% of net revenues for the comparable period in 2011. The increase in G&A expenses as a percentage of quarterly revenues was mainly due to lower revenues.

Sales and marketing expenses for the second quarter of 2012 were $3.3 million, or 40.5% of net revenues, compared with $6.0 million, or 43.8% in the second quarter of 2011. The decrease in sales and marketing expenses in absolute value was due to lower marketing expenses and sales commissions.

Product development expenses for the second quarter of 2012 were $2.7 million, or 33.3% of net revenues, compared with $3.3 million, or 23.6% of net revenues for the same quarter in 2011. The Company continues to invest in its data, product and technical capabilities for the long run.

Total operating expenses for the second quarter of 2012 were $8.6 million, down from $11.9 million in the second quarter of 2011.

Net loss attributable to China Finance Online for the second quarter of 2012 was $2.6 million, compared with a net loss of $1.8 million in the second quarter of 2011. Both basic and diluted weighted average number of ordinary shares in the second quarter of 2012 was 109 million. Each ADS represents five ordinary shares of the Company.

As of June 30, 2012, total cash, cash equivalents and restricted cash were $80.6 million. Accounts receivable in non-margin related business were $3.9 million while Daily Growth had margin-related accounts receivables of $18.6 million. Daily Growth continues to implement strict margin account screening and ongoing monitoring to ensure the safe return of capital.

Total China Finance Online Co. Limited's shareholders' equity was $87.3 million as of June 30, 2012. 

The combined current and non-current deferred revenues at the end of the second quarter of 2012, which represented prepaid service fees made by customers for subscription services that have not been rendered as of June 30, 2012, were $16.9 million.

As of June 30, 2012, the number of active paid subscribers of the Company was approximately 64,000. Given that the Company has ceased accepting new paid subscriptions and renewals for the Company's premium individual subscriptions as part of the strategic transition, this metric will no longer be disclosed going forward.  

Six Month Results

Total net revenues for the first six months ended June 30, 2012 were $17.2 million, compared with $28.7 million in the first six months last year. Gross profit for the first six months of 2012 was $12.7 million, compared to $24.3 million in the same period a year ago. Gross margin was 73.6% for the first six months of 2012. Net loss attributable to China Finance Online for the first six months of 2012 was $3.8 million, compared to a net loss of $0.4 million in the same period in 2011.

Recent Developments

In the third quarter of 2012, one of our PRC affiliates received the regulatory approval for mutual fund distribution in Mainland China.

Mr. Zhiwei Zhao, Chairman and CEO of China Finance Online, commented, "Amidst the persistent European sovereign debt crisis and a slowing PRC domestic economy, the Chinese stock market continued its downward trend during the second quarter of 2012. China's GDP growth dipped below 8% for the first time in twelve consecutive quarters. The Shanghai A-Share index breached its three-year lows and investor sentiment remains fragile. A tough macroeconomic and market environment poses substantial challenges for our ongoing operations.

"In the face of these challenges, we are implementing additional cost-cutting initiatives to increase efficiency and improve operational performance. We continue to expand the influence and technical capabilities of our flagship financial media platforms for further internet applications. With improving internet capabilities and consistent user traffic, we are also looking to upgrade our advertising business.

"Meanwhile, we continue to proceed with operational transition and we have launched trial services for our securities investment advisory operations during the third quarter. In the third quarter of 2012, one of our PRC affiliates obtained regulatory approval to distribute mutual funds. The newly granted mutual fund license will allow us to diversify our product portfolio and help expand our customer base. However, given the trying external environment, it will take some time for such new segments to generate revenues.

"In the midst of a slowing economy and weak stock markets, we are proactively laying the foundation for future growth through product innovation, resource consolidation and streamlining our corporate structure. Our strategic vision remains to become a leading service provider of informational and other value-added financial products for Chinese investors through leveraging on our proven strength in vertically integrated market intelligence and our substantial experience in financial services," concluded Mr. Zhao.

Conference Call Information

The Company will host a conference call and a simultaneous webcast, on September 13, 2012 at 8:00 p.m. Eastern Time/September 14, 2012 8:00 a.m. Beijing Time. Interested parties may participate in the conference call by dialing approximately five minutes before the call start time at U.S. +1-877-847-0047, Hong Kong +852-3006-8101, Singapore 8008-523-396, or China 800-876-5011, and the pass code for all regions is 680771.

A replay of the conference call will be available shortly after the conclusion of the event through 11:59 a.m. Eastern Time on September 21, 2012 (or 11:59 p.m. Beijing Time on September 21, 2012). The dial-in details for the replay: U.S. +1-866-572-7808, Hong Kong +852-3012-8000, Singapore 800-101-2157, China 800-876-5013. Access code: 680771.     

The conference call will be available as a live webcast and replay at: http://www.media-server.com/m/p/tu2498j3

About China Finance Online

China Finance Online Co. Limited is a technology-driven, user-focused market leader in China in providing vertically integrated financial information and services including news, data, analytics, securities investment advisory and brokerage-related services. Through its flagship portal sites, www.jrj.com and www.stockstar.com, the Company offers basic software and information services to individual investors which integrate financial and listed-company data, information and analytics from multiple sources. Leveraging on its robust internet capabilities and registered user base, China Finance Online is developing securities investment advisory and over time wealth management services. Through its subsidiary, Genius, the Company provides financial database and analytics to institutional customers including domestic brokerages and investment firms. Through its subsidiary, Daily Growth, the Company provides securities brokerage services in Hong Kong.

Safe Harbor Statement

This press release contains forward-looking statements. These statements constitute "forward-looking" statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in 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, this release contains the following forward-looking statements regarding:    

  • our product upgrade and strategic transformation initiative;
  • our resource consolidation initiative and its effect on efficiency and operational performance;
  • our plans to streamline our corporate structure;
  • the importance of our regulatory approval to distribute mutual funds;
  • the market prospect of the business of securities investment advisory and wealth management;

Such statements involve certain risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements, which risks and uncertainties include, among others, the following:

  • the changing customer needs, regulatory environment and market condition that we are subject to;
  • the uneven condition of the world and Chinese economy that could lead to volatility in the equity markets and affect our operating results in the coming quarters;
  • the impact of a poor performing Chinese stock market on our future performance;
  • the unpredictability of our strategic transformation and upgrade;
  • the competition we are facing in the new business of securities investment advisory and wealth management;
  • global macroeconomic uncertainties;
  • wavering investor confidence that could impact our business;
  • the extent to which Stockstar's financial information services can be integrated into the mobile web application launched by Stockstar and Baidu, and the continuity of the exclusive partnership; and​
  • possible non-cash goodwill, intangible assets and investment impairment may adversely affect our net income.​

Further information regarding these and other risks is included in the Company's filings with the U.S. Securities and Exchange Commission, including its annual report on Form 20-F under "Forward-Looking Information" and "Risk Factors." The Company does not undertake any obligation to update any forward-looking statement as a result of new information, future events or otherwise, except as required under applicable law.

Contact:

Julie Zhu
China Finance Online Co. Limited
+86-10-5832-5288
[email protected]

Shiwei Yin
Grayling
646-284-9474
[email protected]




China Finance Online Co. Limited

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands of U.S. dollars)



Jun. 30, 2012

Dec. 31, 2011

Assets



Current assets:



Cash and cash equivalents

37,080

64,641

Restricted cash

43,520

29,861

Trust bank balances held on behalf of customers

8,337

18,664

Accounts receivable, net - others

3,899

1,468

Accounts receivable, net - Margin clients

18,624

12,889

Loan receivable

9,853

9,566

Short-term investments

68

10,701

Prepaid expenses and other current assets

3,865

3,577

Deferred tax assets, current

486

634

Total current assets

125,732

152,001

Property and equipment, net

5,776

6,530

Acquired intangible assets, net

4,813

-

Rental deposits

908

738

Goodwill

2,432

          -

Deferred tax assets, non-current

488

484

Other deposits

222

224

Total assets

140,371

159,977




Liabilities and equity



Current liabilities:



Deferred revenue, current (including deferred revenue, current of the consolidated variable interest entities without recourse to China Finance Online Co. Limited $5,357 and $7,037 as of June 30,2012 and December 31,2011, respectively)

12,119

17,287

Accrued expenses and other current liabilities (including accrued expenses and other current liabilities of the consolidated variable interest entities without recourse to China Finance Online Co. Limited $2,012 and $3,127 as of June 30,2012 and December 31, 2011, respectively)

4,357

6,458

Short-term loan(including short-term loan of the consolidated variable interest entities without recourse to China Finance Online Co. Limited nil and nil as of June 30,2012 and December 31, 2011, respectively)

21,138

19,171

Amount due to customers for trust bank balances held on behalf of customers(including amount due to customers for trust bank balances held on behalf of customers of the consolidated variable interest entities without recourse to China Finance Online Co. Limited nil and nil as of June 30,2012 and December 31, 2011, respectively)

8,337

18,664

Accounts payable (including accounts payable of the consolidated variable interest entities without recourse to China Finance Online Co. Limited $239 and $115 as of June 30, 2012 and December 31, 2011, respectively)

495

144

Deferred tax liabilities, current(including deferred tax liabilities, current of the consolidated variable interest entities without recourse to China Finance Online Co. Limited nil and $3 as of June 30, 2012 and December 31, 2011, respectively)

2

45

Income taxes payable (including income taxes payable of the consolidated variable interest entities without recourse to China Finance Online Co. Limited nil and $25 as of June 30,2012 and December 31,2011, respectively)

327

135

Total current liabilities

46,775

61,904

Deferred tax liabilities, non-current (including deferred tax liabilities, non-current of the consolidated variable interest entities without recourse to China Finance Online Co. Limited $1,203 and nil as of June 30, 2012 and December 31, 2011, respectively)

1,203

 -

Deferred revenue, non-current (including deferred revenue, non-current of the consolidated variable interest entities without recourse to China Finance Online Co. Limited $1,692 and $3,033 as of June 30,2012 and December 31,2011, respectively)

4,787

7,237

Total liabilities

52,765

69,141

Noncontrolling interests

261

(105)

Total China Finance Online Co. Limited Shareholders' equity

87,345

90,941

Total liabilities and equity

140,371

159,977

 




China Finance Online Co. Limited

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in thousands of U.S. dollars, except share and ADS related data)



Three months ended

Six months ended


Jun. 30, 2012

Jun. 30, 2011

Mar.31,  2012

Jun. 30, 2012

Jun. 30, 2011

Net revenues

8,100

13,778

9,109

17,209

28,733

Cost of revenues

(2,552)

(2,164)

(1,988)

(4,540)

(4,401)

Gross profit

5,548

11,614

7,121

12,669

24,332

Operating expenses






General and administrative(includes share-based compensation expenses of $197, $335, $174, $371 and $763, respectively)

(2,602)

(2,618)

(2,766)

(5,368)

(5,344)

Sales and marketing (includes share-based compensation expenses of $6, $26, $8,$14 and $70, respectively)

(3,281)

(6,035)

(3,549)

(6,830)

(11,633)

Product development (includes share-based compensation expenses of $3, $18, $3, $6 and $50, respectively)

(2,696)

(3,258)

(3,205)

(5,901)

(6,483)







Total operating expenses

(8,579)

(11,911)

(9,520)

(18,099)

(23,460)

Government subsidies

-

124

19

19

237

Income (loss) from operations

(3,031)

(173)

(2,380)

(5,411)

1,109

Interest income

885

734

1,088

1,973

1,440

Interest expense

(206)

(72)

(124)

(330)

(126)

Investment gain (loss), net

184

(416)

178

362

357

Other income (loss), net

(21)

52

79

58

54

Exchange gain (loss), net

(131)

355

25

(106)

623

Loss from impairment of cost method investment

-

(1,480)

-

-

(1,480)







Income (loss) before income tax expenses

(2,320)

(1,000)

(1,134)

(3,454)

1,977

Income tax expenses

(276)

(850)

(56)

(332)

(2,287)







Net loss

(2,596)

(1,850)

(1,190)

(3,786)

(310)

Less: Net income (loss) attributable to the non-controlling interest

(14)

(54)

63

49

93

Net loss attributable to China Finance Online Co. Limited

(2,582)

(1,796)

(1,253)

(3,835)

(403)







Net loss

(2,596)

(1,850)

(1,190)

(3,786)

(310)

Changes in foreign currency translation adjustment

(200)

807

60

(140)

1,411

Net unrealized gain (loss) on available-for-sale securities, net of tax effects of $9, nil, ($3), $6 and nil, respectively

47

-

(15)

32

-

Other comprehensive income, net of tax

(153)

807

45

(108)

1,411

Comprehensive income (loss)

(2,749)

(1,043)

(1,145)

(3,894)

1,101

Less: comprehensive income (loss) attributable to non-controlling interest

(14)

(54)

63

49

93

Comprehensive income (loss) attributable to China Finance Online Co. Limited

(2,735)

(989)

(1,208)

(3,943)

1,008







Net loss per share attributable to China Finance Online Co. Limited






Basic

(0.02)

(0.02)

(0.01)

(0.04)

0.00

Diluted

(0.02)

(0.02)

(0.01)

(0.04)

0.00

Loss per ADS






Basic

(0.12)

(0.08)

(0.06)

(0.18)

(0.02)

Diluted

(0.12)

(0.08)

(0.06)

(0.18)

(0.02)

Weighted average ordinary shares






Basic

108,982,101

108,957,650

108,982,101

108,982,101

108,951,507

Diluted

108,982,101

108,957,650

108,982,101

108,982,101

108,951,507

Weighted average ADSs






Basic

21,796,420

21,791,530

21,796,420

21,796,420

21,790,301

Diluted

21,796,420

21,791,530

21,796,420

21,796,420

21,790,301

 

SOURCE China Finance Online Co., Ltd.

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
Everyone wants to use containers, but monitoring containers is hard. New ephemeral architecture introduces new challenges in how monitoring tools need to monitor and visualize containers, so your team can make sense of everything. In his session at @DevOpsSummit, David Gildeh, co-founder and CEO of Outlyer, will go through the challenges and show there is light at the end of the tunnel if you use the right tools and understand what you need to be monitoring to successfully use containers in your...
Developers want to create better apps faster. Static clouds are giving way to scalable systems, with dynamic resource allocation and application monitoring. You won't hear that chant from users on any picket line, but helping developers to create better apps faster is the mission of Lee Atchison, principal cloud architect and advocate at New Relic Inc., based in San Francisco. His singular job is to understand and drive the industry in the areas of cloud architecture, microservices, scalability ...
Data is an unusual currency; it is not restricted by the same transactional limitations as money or people. In fact, the more that you leverage your data across multiple business use cases, the more valuable it becomes to the organization. And the same can be said about the organization’s analytics. In his session at 19th Cloud Expo, Bill Schmarzo, CTO for the Big Data Practice at Dell EMC, introduced a methodology for capturing, enriching and sharing data (and analytics) across the organization...
The explosion of new web/cloud/IoT-based applications and the data they generate are transforming our world right before our eyes. In this rush to adopt these new technologies, organizations are often ignoring fundamental questions concerning who owns the data and failing to ask for permission to conduct invasive surveillance of their customers. Organizations that are not transparent about how their systems gather data telemetry without offering shared data ownership risk product rejection, regu...
Grape Up is a software company, specialized in cloud native application development and professional services related to Cloud Foundry PaaS. With five expert teams that operate in various sectors of the market across the USA and Europe, we work with a variety of customers from emerging startups to Fortune 1000 companies.
Financial Technology has become a topic of intense interest throughout the cloud developer and enterprise IT communities. Accordingly, attendees at the upcoming 20th Cloud Expo at the Javits Center in New York, June 6-8, 2017, will find fresh new content in a new track called FinTech.
SYS-CON Events announced today that Interoute, owner-operator of one of Europe's largest networks and a global cloud services platform, has been named “Bronze Sponsor” of SYS-CON's 20th Cloud Expo, which will take place on June 6-8, 2017 at the Javits Center in New York, New York. Interoute is the owner-operator of one of Europe's largest networks and a global cloud services platform which encompasses 12 data centers, 14 virtual data centers and 31 colocation centers, with connections to 195 add...
@DevOpsSummit at Cloud taking place June 6-8, 2017, at Javits Center, New York City, is co-located with the 20th International Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. The widespread success of cloud computing is driving the DevOps revolution in enterprise IT. Now as never before, development teams must communicate and collaborate in a dynamic, 24/7/365 environment. There is no time to wait for long developm...
Multiple data types are pouring into IoT deployments. Data is coming in small packages as well as enormous files and data streams of many sizes. Widespread use of mobile devices adds to the total. In this power panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, panelists will look at the tools and environments that are being put to use in IoT deployments, as well as the team skills a modern enterprise IT shop needs to keep things running, get a handle on all this data, and deli...
The age of Digital Disruption is evolving into the next era – Digital Cohesion, an age in which applications securely self-assemble and deliver predictive services that continuously adapt to user behavior. Information from devices, sensors and applications around us will drive services seamlessly across mobile and fixed devices/infrastructure. This evolution is happening now in software defined services and secure networking. Four key drivers – Performance, Economics, Interoperability and Trust ...
In recent years, containers have taken the world by storm. Companies of all sizes and industries have realized the massive benefits of containers, such as unprecedented mobility, higher hardware utilization, and increased flexibility and agility; however, many containers today are non-persistent. Containers without persistence miss out on many benefits, and in many cases simply pass the responsibility of persistence onto other infrastructure, adding additional complexity.
Bert Loomis was a visionary. This general session will highlight how Bert Loomis and people like him inspire us to build great things with small inventions. In their general session at 19th Cloud Expo, Harold Hannon, Architect at IBM Bluemix, and Michael O'Neill, Strategic Business Development at Nvidia, discussed the accelerating pace of AI development and how IBM Cloud and NVIDIA are partnering to bring AI capabilities to "every day," on-demand. They also reviewed two "free infrastructure" pr...
Cloud Expo, Inc. has announced today that Aruna Ravichandran, vice president of DevOps Product and Solutions Marketing at CA Technologies, has been named co-conference chair of DevOps at Cloud Expo 2017. The @DevOpsSummit at Cloud Expo New York will take place on June 6-8, 2017, at the Javits Center in New York City, New York, and @DevOpsSummit at Cloud Expo Silicon Valley will take place Oct. 31-Nov. 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
Most companies are adopting or evaluating container technology - Docker in particular - to speed up application deployment, drive down cost, ease management and make application delivery more flexible overall. As with most new architectures, this dream takes a lot of work to become a reality. Even when you do get your application componentized enough and packaged properly, there are still challenges for DevOps teams to making the shift to continuous delivery and achieving that reduction in cost ...
Translating agile methodology into real-world best practices within the modern software factory has driven widespread DevOps adoption, yet much work remains to expand workflows and tooling across the enterprise. As models evolve from pockets of experimentation into wholescale organizational reinvention, practitioners find themselves challenged to incorporate the culture and architecture necessary to support DevOps at scale. In his session at @DevOpsSummit at 20th Cloud Expo, Anand Akela, Senior...