Jingwei International Limited Reports Third Quarter 2010 Financial Results

SHENZHEN, China, Nov. 12, 2010 /PRNewswire-Asia-FirstCall/ -- Jingwei International Limited (Nasdaq: JNGW) ("Jingwei" or "the Company"), a leading provider of data-mining, interactive marketing and software services in China, today announced its financial results for the third quarter ended September 30, 2010.

Third Quarter 2010 Highlights:

• Total revenue increased 18.8% year-over-year to $10.4 million
• Software Services segment revenue rose 54.2% year-over-year to $5.1 million
• Data Mining segment revenue declined 2.7% year-over-year to $5.3 million, due to period-to-period fluctuations in the timing of new contracts
• Gross profit climbed 45.1% year-over-year to $4.8 million
• Gross margin was 46.5%, up 8.4% from 38.1% a year ago
• Net income increased 96% year-over-year to $2.7 million, or $0.13 per basic share and per diluted share
• Cash and equivalents at end of the third quarter was $10.1 million, compared to $10.2 million at the end of 2009

Subsequent Events:

• On November 9, 2010, Jingwei closed the acquisition of a 100% equity interest in acquisition of Shanghai Haicom Limited ("Haicom"), a Shanghai-based Internet and mobile value added service platform provider with business operations covering ten provinces in the People's Republic of China.

Key financial results for the third quarter 2010 versus the third quarter 2009 and the first nine months 2010 versus first nine months 2009 are as follows (in US dollars thousands, except per share data):  

“Our solid year-over-year growth in the third quarter of 2010 was driven by robust Software Services sales, which benefited from strong demand for our business support software by telecom and cable operators who are deploying IPTV and DTV in China,” commented Mr. Rick Luk, Chief Executive Officer of Jingwei International. “During the quarter, we continue to advance our APP store offering and also received new Software Services orders in the power sector to support the smart grid program. Our Data Mining segment revenues fell slightly this period, reflecting quarter-to-quarter variation in the timing of new contracts, but we continue to see strong demand for our bundled mobile value-added service (VAS) offerings and interactive marketing services. As well, we are glad to report that the Company signed two framework agreements with China Unicom in Zhejiang province in October, to partner with China Unicom to provide mobile Internet and interactive marketing services in the region.”

Business Outlook

Given Jingwei's strong performance during the first nine months of 2010 and the outlook for the remainder of the year, the Company reaffirms its previous guidance for fiscal year 2010 of total revenues between $37.5 million and $42.0 million and net income between $8.8 million and $9.8 million. The Company expects this year's diluted share count to reach approximate 20.6 million on a weighted average basis, and diluted earnings per share to range from $0.43 to $0.48 in 2010.

“We are very pleased with our recent acquisition of Haicom, which is accretive to earnings immediately and an important part of our strategy to strengthen Jingwei’s mobile value added service offerings and technologies in the 3G space.  Heading into 2011, we intend to extend the geographic reach of our interactive marketing services, replicate and deploy our high-margin BSS solutions in support of ITPV / DTV in new provinces and cities, and selectively pursue acquisitions that dovetail well with our growth strategy, including opportunities to build up our capabilities in the smart grid space,” Mr. Luk concluded.

About Jingwei International Limited:

Jingwei International Limited ("Jingwei") is a leading provider of data mining, interactive marketing and software services in China.  By leveraging its proprietary database of over 400 million consumer profiles, Jingwei helps companies to more effectively reach their target audiences. To capitalize on China's rapid growth in mobile, Internet and e-Commerce applications, Jingwei has focused on enhanced data mining offerings that encompass interactive marketing, bundled mobility solutions and mobile value added services.  The Company's software services include business intelligence ("BI"), billing, operations support ("BSS/OSS") and customer relationship management ("CRM") solutions for Chinese telecom operators and power companies.

Business Risks and Forward-Looking Statements

This report includes forward-looking statements. Generally, the words "believes," "anticipates," "may," "will," "should," "expect," "intend," "estimate," "continue," and similar expressions or the negative thereof or comparable terminology are intended to identify forward-looking statements. Such statements are subject to certain risks and uncertainties, including the matters set forth in this report or other reports or documents we file with the Securities and Exchange Commission from time to time, which could cause actual results or outcomes to differ materially from those projected. Undue reliance should not be placed on these forward-looking statements, which speak only as of the date hereof. We undertake no obligation to update these forward-looking statements.

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SOURCE Jingwei International Limited