Focus Media Records Q3 2009 Net Loss of USD 128 Mln
Focus Media, 12/07/09
Chinese digital media and Internet advertising operator Focus Media (Nasdaq: FMCN) has announced its unaudited financial results for Q3 2009. On September 28, 2009, Focus Media and Chinese internet firm Sina (Nasdaq: SINA) did not extend the deadline for the proposed sale of Focus Media's LCD display network, poster frame network and certain in-store networks. Those assets had been recorded as an asset group held-for-sale in accordance with US GAAP, and were not depreciated or amortized nor were they subject to the same impairment analysis as assets held and used in continuing operations. Those assets were reclassified for financial reporting purposes as assets to be held and used, and Focus Media recorded catch-up depreciation expenses of USD 17 mln, expenses that would have been recorded during the period from December 22, 2008 to June 30, 2009.
The company's net revenues in Q3 2009 reached USD 166.6 mln, down 3% quarter-on-quarter, and down 26% year-on-year. Revenue from continuing operations exceeded previous minimum guidance of USD 69.0 mln.
The aggregate net revenue for the LCD display network, in-store network and poster frame network (previous classified within discontinued operations) was USD 85.8 mln, surpassing the high end of previous quarter guidance of USD 81.5 mln.
Net loss attributable to shareholders was USD 127.6 mln, or a loss of USD 0.99 per fully diluted ADS, compared to net loss attributable to shareholders of USD 23 mln in Q2 2009 or a net loss of USD 0.18 per fully diluted ADS, and net income attributable to shareholders of USD 51.4 mln in Q3 2008 or net income of USD 0.38 per fully diluted ADS.
Advertising revenue from the movie theater and outdoor traditional billboard network was USD 12.5 mln in Q3 2009, down 15.4% from USD 14.8 mln in Q2 2009 and down 36.3% from USD 19.6 mln in Q3 2008.
Internet advertising service revenue was USD 68.3 mln in Q3 2009, up 2.4% from USD 66.7 mln in Q2 2009, but down 3.5% from USD 70.8 mln in Q3 2008. The revenues from fully and partially disposed subsidiaries contributed USD 28.6 mln and USD 30.9 mln to the Internet advertising service revenue for the third quarter and the second quarter of 2009, respectively.
Advertising revenue from the LCD display network was USD 56 mln for Q3 2009, up 4% from USD 54.3 mln in Q2 2009, but down 32% from USD 73.7 mln in Q3 2008.
Advertising revenue from the in-elevator poster frame network was USD 22.1 mln for Q3 2009, down 17% from USD 26.5 mln in Q2 2009, and down 50% from USD 44 mln in Q3 2008.
Advertising revenue from the in-store network was USD 7.6 mln for Q3 2009, down 16% from USD 9 mln in Q2 2009, and up 7% from USD 7.1 mln in Q3 2008.
As of September 30, 2009, the total installed base of LCD displays in Focus Media's commercial location network was 130,890 nationwide, including 125,467 displays through its directly owned networks, and 5,423 displays through its regional distributors, as compared to 133,514 as of June 30, 2009. The total number of non-digital frames available for sale on its in-elevator poster frame network was 225,762 as of September 30, 2009, as compared to 246,095 as of June 30, 2009. The decline was primarily attributable to continuing optimization of the company's network. In addition, as of September 30, 2009, Focus Media had 36,539 digital frames installed in its poster frame network. The total number of displays installed in its in-store network was 45,195 as of September 30, 2009, compared to 44,783 as of June 30, 2009.
In Q4 2009, Focus Media expects net revenues for LCD display networks, In-store networks and Poster frame networks to be no less than USD 92 mln, and net revenues from movie theatre and traditional outdoor billboard and internet advertising services to be no less than USD 39 mln.
Keywords: frame advertising Focus Media digital media guidance Internet loss revenue television Q3 2009 Sina FMCN profit out-of-home display online advertising fiscal report
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