Ku6 Media Reports Unaudited Financial Results for the Third Quarter of Fiscal Year 2013

BEIJING, Dec. 19, 2013 /PRNewswire/ -- Ku6 Media Co., Ltd. ("Ku6 Media" or the "Company," NASDAQ: KUTV), a leading internet video company focused on User Generated Content ("UGC") in China, today announced unaudited financial results for the third quarter of fiscal year 2013 ended September 30, 2013.

Third Quarter 2013 Highlights (1)


  • The Company generates substantially all of its revenues from online advertising, primarily through an advertising agency agreement with Shengyue, an affiliate wholly owned by Shanda Interactive, pursuant to which Shengyue acts as the Company's exclusive advertising agency for standard media resources and as its non-exclusive advertising agency for highly interactive advertising resources.
  • GAAP net loss was US$3.44 million (RMB21.05 million), as compared to a net loss of US$2.54 million in the second quarter of 2013 and US$3.25 million in the third quarter of 2012. Non-GAAP net loss, which the Company defines as net loss excluding expenses (benefits) associated with share-based compensation, was US$3.14 million (RMB19.20 million) in the third quarter of 2013, as compared to non-GAAP net loss of US$2.38 million in the second quarter of 2013 and US$3.26 million in the third quarter of 2012.
  • Basic and diluted loss per ADS was US$0.07 (RMB0.43) in the third quarter of 2013, as compared to US$0.05 in the second quarter 2toof 2013 and US$0.07 in the third quarter of 2012.
  • Cash and cash equivalents were US$6.09 million (RMB37.28 million) as of September 30, 2013.
  • Net cash used in operating activities was US$3.86 million (RMB23.63 million) in the third quarter of 2013, as compared to US$0.93 million in the second quarter of 2013 and US$1.92 million in the third quarter of 2012. 

(1)     The reporting currency of the Company is the United States dollar ("U.S. dollar"), but solely for the convenience of the reader, the amounts of Renminbi ("RMB") presented throughout the release were calculated at the rate of US$1.00=RMB6.1200, representing the noon buying rate as of September 30, 2013 in the City of New York for cable transfers of RMB as certified for customs purposes by the Federal Reserve Bank of New York. This convenience translation is not intended to imply that the U.S. dollar amounts could have been, or could be, converted, realized or settled into RMB at that rate on September 30, 2013, or at any other rate.

"In the third quarter of 2013, the major tasks for the Company were to establish a new strategy to strengthen our leading position in the UGC area in China and to enhance the Company's brand to attract more quality advertisers as well as talent," Mr. Fang Du, Chief Executive Officer of Ku6 Media, commented. "The new strategy we've launched is to leverage influences of events with unique themes, developments in the mobile market, and in-depth collaboration with TV stations, to boost website traffic, promote the Company's brand and more importantly to test an innovative business model for the online video industry."

"In October, we launched The UGC Entertainment Awards, the very first TV station and Internet simulcast program focusing on UGC content in China," continued Mr. Du. "The program aims to boost China's UGC industry by inspiring people to record their memorable moments. More than that, it was also China's very first program produced jointly by an online video company and a traditional TV station. As of today, The UGC Entertainment Awards has become one of the most popular TV programs nationally among all the TV programs aired at the same time slot. We believe this is a good start for our TV station – Internet collaboration business model."

"Going forward, we will keep focusing on our goals and exploring more innovative business models under our core strategy – User Generated Content. We strive to bring the best rewards to our supportive investors and hard-working employees."     

Third Quarter 2013 Financial Results

Total revenues were US$3.40 million (RMB20.83 million) in the third quarter of 2013, representing a decrease of 0.4% from US$3.42 million in the second quarter of 2013 and an increase of 11.4% from US$3.06 million in the third quarter of 2012.

The Company generated 96.1% of total revenues in the third quarter of 2013 through this affiliated advertising agent, as compared to 89.9% of total revenues in the second quarter of 2013.

Cost of revenues was US$3.69 million (RMB22.60 million) in the third quarter of 2013, representing a decrease of 5.2% from US$3.90 million in the second quarter of 2013 and an increase of 0.8% from US$3.66 million in the third quarter of 2012.

Gross loss was US$0.29 million (RMB1.77 million) in the third quarter of 2013, as compared to a gross loss of US$0.48 million in the second quarter of 2013 and a gross loss of US$0.61 million in the third quarter of 2012. Non-GAAP gross loss, which is herein defined as a gross loss excluding expenses (benefits) associated with share-based compensation, was US$0.25 million (RMB1.51 million) in the third quarter of 2013, as compared to a non-GAAP gross loss of US$0.44 million in the second quarter of 2013 and a non-GAAP gross loss of US$0.58 million in the third quarter of 2012.

Operating expenses were US$4.12 million (RMB25.18 million) in the third quarter of 2013, representing an increase of 24.8% from US$3.30 million in the second quarter of 2013 and an increase of 44.4% from US$2.85 million in the third quarter of 2012. Non-GAAP operating expenses, which are herein defined as operating expenses excluding expenses (benefits) associated with share-based compensation, were US$3.86 million (RMB23.60 million) in the third quarter of 2013, as compared to non-GAAP operating expenses of US$3.17 million in the second quarter of 2013 and US$2.88 million in the third quarter of 2012. The increase in operating expenses as compared to the second quarter of 2013 was primarily due to (1) expenses for promotional campaigns and marketing events held in the third quarter of 2013, (2) the effect of a gain on disposal included in second quarter 2013 operating expenses relating to the sale of network equipment, and (3) an increase in share-based compensation expenses arising from stock option awards mostly granted to new-joined management and talents.

Operating loss was US$4.40 million (RMB26.95 million) in the third quarter of 2013, representing an increase of 16.7% from US$3.77 million in the second quarter of 2013 and an increase of 27.5% from US$3.46 million in the third quarter of 2012. Non-GAAP operating loss, which reflects the exclusion of expenses (benefits) associated with share-based compensation, was US$4.10 million (RMB25.11 million) in the third quarter of 2013, as compared to the non-GAAP operating loss of US$3.61 million in the second quarter of 2013 and US$3.46 million in the third quarter of 2012.

Net loss was US$3.44 million (RMB21.05 million) in the third quarter of 2013, representing an increase of 35.3% from US$2.54 million in the second quarter of 2013 and an increase of 5.8% from US$3.25 million in the third quarter of 2012. Non-GAAP net loss, which reflects the exclusion of expenses (benefits) associated with share-based compensation, was US$3.14 million (RMB19.20 million) in the third quarter of 2013, as compared to US$2.38 million in the second quarter of 2013 and US$3.26 million in the third quarter of 2012. The increase in net loss as compared to the second quarter of 2013 was primarily attributable to (1) an increase in expenses for promotional campaigns and marketing events held in the third quarter of 2013, (2) the effect of a gain on disposal included in second quarter 2013 operating expenses relating to the sale of network equipment, and (3) an increase in share-based compensation expenses arising from stock option awards mostly granted to new-joined management and talents.

Net loss per basic and diluted ADS was US$0.07 (RMB0.43) in the third quarter of 2013, as compared to US$0.05 in the second quarter of 2013 and US$0.07 in the third quarter of 2012. Weighted average ADSs used to calculate basic and diluted net loss per ADS were 47.3 million in the third quarter of 2013, 47.3 million in the second quarter of 2013 and 48.3 million in the third quarter of 2012.

Adjusted EBITDA loss, which is herein defined as net loss before interest income, interest expenses, income taxes, depreciation and amortization (excluding amortization and write-down of licensed video copyrights), further adjusted for share-based compensation expenses (benefits), equity in loss of affiliates and other non-operating items, was US$3.31 million (RMB20.23 million) in the third quarter of 2013, as compared to adjusted EBITDA loss of US$2.69 million in the second quarter of 2013 and US$2.58 million in the third quarter of 2012.

As of September 30, 2013, the Company had US$6.09 million (RMB37.28 million) in cash and cash equivalents, compared to US$9.96 million as of June 30, 2013. The decrease was primarily attributable to US$3.86 million (RMB23.63 million) of net cash used in operating activities. Additionally, the balance of net working capital (excess of current assets over current liabilities) declined from December 31, 2012 to September 30, 2013. In the near term, the Company expects to continue to incur net cash outflows associated with operating activities for the fourth quarter. To alleviate near-term pressure on the Company's liquidity and enhance financial flexibility, the Company is currently exploring financing options.

Recent Business Developments

Ku6 Media Joins Hands with Zhejiang TV to Launch the UGC Entertainment Awards

The Company held a press conference in Beijing on October 12, announcing its collaboration with Zhejiang TV, a top TV station in China, to launch the UGC Entertainment Awards – the very first TV and Internet simulcast program focusing on UGC content in China.

Ku6 Media Announces the Love-Theme UGC Video Campaign

The Company held a press conference on August 13, Chinese Valentine's Day, to announce its love-theme UGC video campaign. The Company's new slogan "Short is Cool" was first introduced at the press conference, representing the Company's commitment to offer more quality short-form videos by leveraging the prosperity of mobile devices and mobile platforms as well as through promotional campaigns and marketing events.

Share Repurchase Program of 2011

Pursuant to a share repurchase program announced on December 30, 2011, the Company's Board of Directors have authorized the Company to repurchase up to an aggregate of US$3.2 million of its outstanding ADSs from time to time following the date thereof, based on market conditions. As of September 30, 2013, the Company has repurchased 157,567 ADSs from open market under this program. There were no share repurchases in the third quarter of 2013.

Conference Call Information

Ku6's management team will be hosting a corresponding conference call at 8:00 pm EST on Thursday, December 19, 2013 (9:00 am Beijing time on Friday, December 20, 2013).

Dial-in numbers:      

International Dial-in Number:        

+65 67239381

United States Toll Free Number:

18665194004

Mainland China Toll Free Number:

4006208038 / 8008190121

Hong Kong Toll Free Number:            

800930346

Conference ID:

22629562

A replay will be available from 11:00 pm December 19, 2013 EST for 7 days.

International Dial-in Number:        

+61 2 8199 0299

United States Toll Free Number:

18554525696

Mainland China Toll Free Number:

4006322162 / 8008700205

Hong Kong Toll Free Number:

800963117

Conference ID:

22629562

A live and archived webcast of the conference call will also be available at http://www.media-server.com/m/p/dhj8xijz  

About Ku6 Media Co., Ltd.

Ku6 Media Co., Ltd. (NASDAQ: KUTV) is a leading internet video company in China focused on User -Generated Content ("UGC"). Through its premier online brand and online video website, www.ku6.com, Ku6 Media provides online video uploading and sharing service, video reports, information and entertainment in China. For more information about Ku6 Media, please visit http://ir.ku6.com.

Forward-looking Statements

This news release contains statements of a forward-looking nature. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. You can identify these forward-looking statements by terminology such as "believes," "could," "expects," "may," "might," "should," "will," or "would," and by similar statements. Forward-looking statements are not historical facts, but instead represent only the Company's beliefs regarding future events, many of which, by their nature, are inherently uncertain and outside of its control. It is possible that the Company's actual results and financial condition may differ, possibly materially, from the anticipated results and financial condition indicated in these forward-looking statements. Some of the risks and important factors that could affect the Company's future results and financial condition include: continued competitive pressures in China's internet video portal market; changes in technology and consumer demand in this market; the risk that Ku6 Media may not be able to control its expenses in the future; regulatory changes in China with respect to the operations of internet video portal websites; the success of Ku6 Media's ability to sell advertising and other services on its websites; and other risks outlined in the Company's filings with the Securities and Exchange Commission,including the Company's  annual report on Form 20-F. Ku6 Media does not undertake any obligation to update this forward-looking information, except as required under law.

About Non-GAAP Financial Measures

To supplement Ku6 Media's consolidated financial results presented in accordance with United States Generally Accepted Accounting Principles ("GAAP"), Ku6 Media uses the following measures defined as non-GAAP financial measures by the SEC in evaluating its business: non-GAAP gross profit or loss, non-GAAP operating expenses, non-GAAP product development expenses, non-GAAP sales and marketing expenses, non-GAAP general and administrative expenses, non-GAAP operating loss, non-GAAP net loss and adjusted EBITDA loss.  We define non-GAAP gross profit or loss, non-GAAP operating expenses, non-GAAP product development expenses, non-GAAP sales and marketing expenses, non-GAAP general and administrative expenses, non-GAAP operating loss and non-GAAP net loss as the respective nearest comparable GAAP financial measure excluding expenses (benefits) associated with share-based compensation. We define adjusted EBITDA loss as net loss before interest income, interest expenses, income taxes, depreciation and amortization (excluding amortization and write-down of licensed video copyrights), further adjusted for share-based compensation expenses (benefits), equity in loss of affiliates and other non-operating items. We present non-GAAP financial measures because they are used by our management to evaluate our operating performance. We also believe that these non-GAAP financial measures provide useful information to investors and others in understanding and evaluating our consolidated results of operations in the same manner as our management and in comparing financial results across accounting periods and to those of our peer companies. A limitation of using non-GAAP financial measures is that non-GAAP measures exclude share-based compensation charges that have been and will continue to be significant recurring expenses in Ku6 Media's business for the foreseeable future.

The presentation of these non-GAAP financial measures is not intended to be considered in isolation from, or as a substitute for, the financial information prepared and presented in accordance with GAAP. For more information on these non-GAAP financial measures, please see the table captioned "Reconciliations of non-GAAP results of operations measures to the nearest comparable GAAP financial measures" at the end of this release.

For further information, please contact:

Ms. Helen Zou
Investor Relations Director
Telephone +86 10 5758 6835
ir@ku6.com 

  


Ku6 Media Co., Ltd.

Consolidated Balance Sheets

(Amounts in thousands,

except for number of shares)

December 31,

2012

US$

September 30,

2013

US$

(Unaudited)

September 30,

2013

RMB

(Unaudited)

ASSETS




Current assets:




Cash and cash equivalents

13,071

6,091

37,277

Accounts receivable, net

67

42

257

Accounts receivable due from related parties

4,399

5,543

33,923

Prepaid expenses and other current assets

523

432

2,644

Other receivables due from related parties

6,097

2,762

16,903

Total current assets

24,157

14,870

91,004

Non-current assets:




Deposits

310

335

2,050

Property and equipment, net

2,918

1,681

10,288

Acquired intangible assets, net

22,552

21,383

130,864

Goodwill

6,233

6,233

38,146

Total non-current assets

32,013

29,632

181,348

TOTAL ASSETS

56,170

44,502

272,352





LIABILITIES AND SHAREHOLDERS'

EQUITY




Current liabilities:




Accounts payable

4,645

4,505

27,571

Accounts payable due to related parties

-

384

2,350

Accrued expenses and other current liabilities

9,353

8,976

54,933

Other payables due to related parties

3,780

375

2,295

Total current liabilities

17,778

14,240

87,149

Non-current deferred tax liabilities

4,826

4,826

29,535

Total liabilities

22,604

19,066

116,684

Shareholders' equity:




Ordinary shares (US$0.00005 par value;

12,000,000,000 shares authorized; 4,732,446,560

shares and 4,727,148,360 shares issued and

outstanding as of December 31, 2012 and

September 30, 2013, respectively)

236

236

1,444

Additional paid-in capital

177,183

176,947

1,082,916

Accumulated deficit

(141,940)

(149,592)

(915,503)

Accumulated other comprehensive loss

(1,913)

(2,155)

(13,189)

Total Ku6 Media Co., Ltd. shareholders' equity

33,566

25,436

155,668

Non-controlling interests

-

-

-

Total shareholders' equity

33,566

25,436

155, 668

TOTAL LIABILITIES AND

    SHAREHOLDERS' EQUITY

56,170

44,502

272,352

  


Ku6 Media Co., Ltd.

Consolidated Statements of Operations


For the Three Months Ended

For the Nine Months Ended

(Amounts in thousands, except for

number of shares and ADS and per

share and per ADS data)

September 30, 2012

June 

30, 2013

September

30, 2013

September

30, 2013

September 

30, 2012

September 

30, 2013

September

30, 2013

US$

US$

US$

RMB

US$

US$

RMB


(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

Revenues:








Advertising








       Third parties

161

344

134

820

1,214

607

3,715

       Related parties

2,895

3,075

3,270

20,012

9,551

9,284

56,818

Total revenues

3,056

3,419

3,404

20,832

10,765

9,891

60,533









Cost of revenues:








Advertising








       Third parties

3,662

3,702

3,542

21,677

10,853

10,377

63,508

       Related parties

-

193

151

924

-

344

2,105

Total cost of revenues

3,662

3,895

3,693

22,601

10,853

10,721

65,613









Gross profit (loss)

(606)

(476)

(289)

(1,769)

(88)

(830)

(5,080)









Operating expenses:








       Product development

468

952

1,064

6,512

1,410

2,367

14,486

       Sales and marketing

283

642

754

4,614

892

1,696

10,379

       General and administrative

2,098

1,703

2,297

14,058

5,015

5,618

34,382

Total operating expenses

2,849

3,297

4,115

25,184

7,317

9,681

59,247









Operating loss

(3,455)

(3,773)

(4,404)

(26,953)

(7,405)

(10,511)

(64,327)









Interest income

129

16

56

343

462

102

624

Other income

256

1,216

909

5,563

1,249

2,773

16,971

Interest expenses

(114)

-

-

-

(564)

(16)

(98)

Equity in loss of affiliates

(66)

-

-

-

(252)

-

-

Loss before income tax expense

(3,250)

(2,541)

(3,439)

(21,047)

(6,510)

(7,652)

(46,830)









Income tax benefit

-

-

-

-

-

-

-









Net loss

(3,250)

(2,541)

(3,439)

(21,047)

(6,510)

(7,652)

(46,830)









Loss per share - basic and diluted








Net loss

(US$0.00)

(US$0.00)

(US$0.00)

(RMB0.00)

(US$0.00)

(US$0.00)

(RMB0.01)









Loss per ADS - basic and diluted








Net loss

(US$0.07)

(US$0.05)

(US$0.07)

(RMB0.43)

(US$0.13)

(US$0.16)

(RMB0.98)









Weighted average shares used in per

share calculation - basic and diluted

4,832,763,530

4,726,880,171

4,726,724,447

4,726,724,447

4,956,990,158

4,728,448,844

4,728,448,844

Weighted average ADSs used in per

ADS calculation - basic and diluted

48,327,635

47,268,802

47,267,244

47,267,244

49,569,902

47,284,488

47,284,488

  

Ku6 Media Co., Ltd.

Consolidated Statements of Cash Flows


For the Three Months Ended

For the Nine Months Ended

(Amounts in thousands)

September

30, 2012

June

30, 2013

September

30, 2013

September

30, 2013

September

30, 2012

September

30, 2013

September

30, 2013

US$

US$

US$

RMB

US$

US$

RMB


(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

Cash flows from operating activities:








Net loss

(3,250)

(2,541)

(3,439)

(21,047)

(6,510)

(7,652)

(46,830)

Adjustments to reconcile net loss to net cash

   used in operating activities:








Share-based compensation (reversal)

(5)

162

302

1,848

444

(183)

(1,120)

Depreciation and amortization

877

917

796

4,872

2,553

2,650

16,218

Amortization and write-down of licensed

   video copyrights

 

-

 

-

 

-

 

-

1

-

-

Bad debt reversal

(187)

(176)

(66)

(404)

(2,202)

(339)

(2,075)

Reversal of legal provision

-

-

-

-

(565)

-

-

Exchange gain

(93)

(128)

(61)

(373)

(101)

(235)

(1,438)

Equity in loss of affiliates

66

-

-

-

252

-

-

Gain on disposal of property and equipment

-

(137)

-

-

(21)

(150)

(918)

Changes in assets and liabilities, net of

   acquisitions and dispositions:








Accounts receivable

188

113

67

410

2,969

332

2,032

Prepaid expenses and other current assets

(290)

133

(203)

(1,242)

145

91

557

Amount due from related parties

232

1,923

(1,817)

(11,120)

(603)

(1,109)

(6,787)

Deposits and other non-current assets

-

(25)

-

-

-

(25)

(153)

Accounts payable

658

(260)

(171)

(1,047)

(1,381)

(66)

(404)

Accrued expenses and other current

   liabilities

 

(171)

 

(950)

 

575

 

3,519

508

(377)

(2,307)

Amount due to related parties

54

39

156

955

107

1

6

Net cash used in operating activities

(1,921)

(930)

(3,861)

(23,629)

(4,404)

(7,062)

(43,219)

Cash flows from investing activities:








Purchases of property and equipment

(1,092)

-

(21)

(129)

(1,272)

(62)

(379)

Proceeds from disposal of property and

   equipment

 

-

 

142

 

-

 

-

23

142

869

Payments for licensed video copyrights

(88)

(74)

-

-

(236)

(74)

(453)

Restricted cash for pledge of bank loans

3,600

-

-

-

3,600

-

-

Loans to related parties under common control

   by Shanda

-

-

-

-

(470)

-

-

Repayment of loans to related parties under common control

   by Shanda

 

-

 

-

 

-

 

-

9,700

3,300

20,196

Net cash provided by (used in) investing

   activities

 

2,420

 

68

 

(21)

 

(129)

11,345

3,306

20,233

Cash flows from financing activities:








Repurchase of ordinary shares

(8,083)

(17)

-

-

(8,083)

(58)

(355)

Proceeds from exercise of stock options

-

-

6

37

-

6

37

Repayment for loans from bank

(3,148)

-

-

-

(3,148)

-

-

Repayment of loans from related parties under

   common control of Shanda

 

-

 

-

 

-

 

-

 

(9,904)

 

(3,210)

 

(19,645)

Net cash provided by (used in) financing

   activities

 

(11,231)

 

(17)

 

6

 

37

 

(21,135)

 

(3,262)

 

(19,963)

Effect of exchange rate changes on cash and

   cash equivalents

 

(5)

 

26

 

9

 

55

 

(12)

 

38

 

232

Net increase (decrease) in cash and cash

   equivalents

 

(10,737)

 

(853)

 

(3,867)

 

(23,666)

 

(14,206)

 

(6,980)

 

(42,717)

Cash and cash equivalents, beginning of

   period

 

23,282

 

10,811

 

9,958

 

60,943

 

26,751

 

13,071

 

79,994

Cash and cash equivalents, end of period

12,545

9,958

6,091

37,277

12,545

6,091

37,277

Reconciliations of Non-GAAP results of operations measures to the nearest comparable GAAP financial measures (*)

(Amounts in thousands of United States dollars ("US$") and Renminbi ("RMB"), unaudited)

1. Non-GAAP Gross Profit (Loss)




For the Three Months Ended


For the Nine Months Ended



September 

30, 2012


June

30, 2013


September 

30, 2013


September 

30, 2013


September 

30, 2012


September 

30, 2013


September 

30, 2013



US$


US$


US$


RMB


US$


US$


RMB

Gross profit (loss)


(606)


(476)


(289)


(1,769)


(88)


(830)


(5,080)

Add back: expenses (benefits)

   associated with share-based

   compensation


28


39


43


263


92


(115)


(704)

Non-GAAP gross profit (loss)


(578)


(437)


(246)


(1,506)


4


(945)


(5,784)

   

2. Non-GAAP Operating Expenses



For the Three Months Ended


For the Nine Months Ended



September 

30, 2012


June

30, 2013


September 

30, 2013


September 

30, 2013


September 

30, 2012


September 

30, 2013


September 

30, 2013



US$


US$


US$


RMB


US$


US$


RMB

Operating expenses


2,849


3,297


4,115


25,184


7,317


9,681


59,248

Deduct: expenses (benefits)

   associated with share-based

   compensation


(33)


123


259


1,585


352


(68)


(416)

Non-GAAP operating expenses


2,882


3,174


3,856


23,599


6,965


9,749


59,664

  

3. Non-GAAP Product Development Expenses




For the Three Months Ended


For the Nine Months Ended



September 

30, 2012


June

30, 2013


September 

30, 2013


September 

30, 2013


September 

30, 2012


September 

30, 2013


September 

30, 2013



US$


US$


US$


RMB


US$


US$


RMB

Product development expenses


468


952


1,064


6,512


1,410


2,367


14,486

Deduct: expenses (benefits)

   associated with share-based

   compensation


22


19


35


214


41


(107)


(655)

Non-GAAP product development

expenses


446


933


1,029


6,298


1,369


2,474


15,141

   

4. Non-GAAP Sales and Marketing Expenses




For the Three Months Ended


For the Nine Months Ended



September 

30, 2012


June

30, 2013


September 

30, 2013


September 

30, 2013


September 

30, 2012


September 

30, 2013


September 

30, 2013



US$


US$


US$


RMB


US$


US$


RMB

Sales and marketing expenses


283


642


754


4,614


892


1,696


10,379

Deduct: expenses (benefits)

   associated with share-based

   compensation


8


10


11


67


20


(39)


(238)

Non-GAAP sales and marketing

expenses


275


632


743


4,547


872


1,735


10,617

   

5. Non-GAAP General and Administrative Expenses




For the Three Months Ended


For the Nine Months Ended



September 

30, 2012


June

30, 2013


September 

30, 2013


September 

30, 2013


September 

30, 2012


September 

30, 2013


September 

30, 2013



US$


US$


US$


RMB


US$


US$


RMB

General and administrative expenses


2,098


1,703


2,297


14,058


5,015


5,618


34,382

Deduct: expenses (benefits)

   associated with share-based

   compensation


(63)


94


213


1,304


291


78


477

Non-GAAP general and administrative

expenses


2,161


1,609


2,084


12,754


4,724


5,540


33,905

   

6. Non-GAAP Operating Loss




For the Three Months Ended


For the Nine Months Ended



September 

30, 2012


June

30, 2013


September 

30, 2013


September 

30, 2013


September 

30, 2012


September 

30, 2013


September 

30, 2013



US$


US$


US$


RMB


US$


US$


RMB

Operating loss


(3,455)


(3,773)


(4,404)


(26,953)


(7,405)


(10,511)


(64,327)

Add back: expenses (benefits)

   associated with share-based

   compensation


(5)


162


302


1,848


444


(183)


(1,120)

Non-GAAP operating loss


(3,460)


(3,611)


(4,102)


(25,105)


(6,961)


(10,694)


(65,447)

   

7. Non-GAAP Net Loss




For the Three Months Ended


For the Nine Months Ended



September 

30, 2012


June

30, 2013


September 

30, 2013


September 

30, 2013


September 

30, 2012


September 

30, 2013


September 

30, 2013



US$


US$


US$


RMB


US$


US$


RMB

Net loss


(3,250)


(2,541)


(3,439)


(21,047)


(6,510)


(7,652)


(46,830)

Add back: expenses (benefits)

   associated with share-based

   compensation


(5)


162


302


1,848


444


(183)


(1,120)

Non-GAAP net loss


(3,255)


(2,379)


(3,137)


(19,199)


(6,066)


(7,835)


(47,950)

           

8. Adjusted EBITDA Loss




For the Three Months Ended


For the Nine Months Ended



September 

30, 2012


June 

30, 2013


September

30, 2013


September

30, 2013 


September 

30, 2012


September

30, 2013 


September

30, 2013 



US$


US$


US$


RMB


US$


US$


RMB

Net loss


(3,250)


(2,541)


(3,439)


(21,047)


(6,510)


(7,652)


(46,830)

Add back (deduct):















   Interest income


(129)


(16)


(56)


(343)


(462)


(102)


(624)

   Interest expenses


114


-


-


-


564


16


98

   Income tax benefit


-


-


-


-


-


-


-

Depreciation and amortization

   (excluding amortization and

   write-down of licensed

   video copyrights)


877


917


796


4,872


2,553


2,650


16,218

EBITDA loss


(2,388)


(1,640)


(2,699)


(16,518)


(3,855)


(5,088)


(31,138)
















Adjustments:















   Share-based compensation


(5)


162


302


1,848


444


(183)


(1,120)

   Equity in loss of affiliates


66


-


-


-


252


-


-

   Other income


(256)


(1,216)


(909)


(5,563)


(1,249)


(2,773)


(16,971)

Adjusted EBITDA loss


(2,583)


(2,694)


(3,306)


(20,233)


(4,408)


(8,044)


(49,229)

   

*  For more information on the Non-GAAP financial measures, please see the section captioned "About Non-GAAP Financial Measures" in the earnings release.

SOURCE Ku6 Media Co., Ltd.



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http://ir.ku6.com
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http://www.ku6.com

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