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China Digital TV Holding Q1 2011 Profit Up 39% YoY

China Digital TV PR, 5/16/11

China Digital TV Holding (NYSE: STV), provider of conditional access systems to China's digital television market, today announced its unaudited financial results for the first quarter ended March 31, 2011, with net revenue up 37.7% YoY, but down 41.2% QoQ to USD 19.3 mln.

Net income attributable to China Digital TV in the first quarter of 2011 was USD 7.9 mln, an increase of 38.5% from the same period in 2010 but down 9.4% QoQ.

Revenues from smart cards and related products were USD 18.4 mln in the first quarter of 2011, an increase of 39.9% from the same period in 2010, but fell 41.1% QoQ. The year-over-year increase was primarily due to an increase in the volume of smart card shipments, which was partially offset by a decrease in the average selling price (ASP) of smart cards. The quarter-over-quarter decrease was primarily due to usual seasonality associated with the Chinese New Year holiday. Additionally, the provincial cable network operators accelerated the network consolidation at the provincial level, prompted by a government mandated year-end deadline, which contributed to revenue surge in the fourth quarter of 2010. Sales of smart cards and related products accounted for 94.0% of total revenues in the first quarter of 2011, slightly down from 94.5% in the fourth quarter of 2010.

China Digital TV shipped approximately 3.63 mln smart cards during the first quarter of 2011, compared to 2.57 mln and 6.10 mln smart cards in the first quarter of 2010 and the fourth quarter of 2010, respectively. Chairman and CEO Zhu Jianhua said that China Digital TV increased its market share of China's smart card shipments to 61.8% in the first quarter of 2011, up from 59.1% in the fourth quarter of 2010.

Revenues from the company's top five customers accounted for 23.5% of total revenues in the first quarter of 2011, compared to 23.6% in the fourth quarter of 2010.

Revenues from services were USD 1.2 mln in the first quarter of 2011, an increase of 27.5% and a drop of 35.7% QoQ from the same period in 2010. The year-over-year increase was principally a result of higher head-end system integration revenues and royalty incomes. The quarter-over-quarter decrease was primarily due to decreases in head-end system integration revenues and royalty incomes. Service revenues accounted for 6.0% of total revenues in the first quarter of 2011.

China Digital TV expects smart card shipments for the second quarter of 2011 to be in the range of 3.7 mln to 4.0 mln. Net revenue for the second quarter of 2011 is expected to be in the range of USD 20.1 mln to USD 21.6 mln, representing a year-over-year increase in the range of 4% to 11.9%.

To view China Digital TV's full earnings report, please click here.

Keywords: sales volume guidance Zhu Jianhua consolidation profit revenue television market share China Digital TV Holding conditional access smart card STV Q1 2011 fiscal report

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