2014

V Media Corp. Announces Fiscal 2013 Year End Financial Results

DALIAN, China, Sept. 30, 2013 /PRNewswire/ -- V Media Corp. (OTCBB: CMDI) (the "Company"), China's fast-growing advertising media company with current outdoor media network located in Dalian, Shenyang, Tianjin, Beijing, Shanghai and New York, today announced its financial results for the fiscal year ended June 30, 2013.

Financial Highlights for the Year Ended June 30, 2013

  • Total revenue for fiscal year 2013 was $21.8 million, increased 18.2% compared with fiscal year 2012
  • Gross profit decreased 53.7% to $3.6 million with a corresponding gross margin of 16.4%
  • Net loss attributable to the Company was $6,060,879, decreased $6,111,732 compared with the prior year

Mr. James Wang, Chairman and Chief Executive Officer of V Media, stated, "During our 2013 fiscal year we have been through an advertising market that was much affected by macroeconomic uncertainty. We continue to focus on client diversification and cross selling among different advertising platforms. Our overall revenue increased 18% year-over-year, showing the effectiveness of our strategy, however, our net income was much affected by the cost of developing new markets. Revenue generated from outdoor billboards platforms continued the growth trend- increased 7% from the prior year.  Outdoor billboards accounted for 39% of total revenue in our 2013 fiscal year and have presented great growth opportunities for the Company. Going forward we have several projects in pipeline that we expect will contribute to continued performance growth of this platform in the 2014 fiscal year."

Summary Financials for Year Ended June 30, 2013:  

Year to Date Financials (USD)

Twelve months ended June 30,

2013

2012

CHANGE

Revenue

$21.8 million

$18.5 million

18.2%

Gross Profit

$3.6 million

$7.7 million

-53.7%

Gross Profit Margin

16.4%

41.8%

-60.8%

Net Income (Loss)

-$5.7 million

$0.4 million

-1686.3%

EPS*

-$0.22

$0.00

-100%

* Based on 27.6 million shares outstanding

Financial Results for the Year Ended June 30, 2013

Revenue for the year ended June 30, 2013 totaled $21.8 million, an increase of 18.2% compared to $18.5 million for the same period in 2012. We see revenue increase of 7% in the outdoor billboard advertising platform which accounted for 39% of total revenue during the 2013 fiscal year. The billboard advertising platform has presented a significant growth opportunity with attractive profit margins which were 36% for the 2013 fiscal year. The outdoor billboard platform is established in Dalian, Shenyang, Tianjin, Beijing, Shanghai and New York and going forward the Company will continue to establish their presence in these markets. Revenue in Dalian, which accounted for 76% of total revenue, increased by 17% to $16.6 million for the 2013 fiscal year as compare to $14.1 million for the 2012 fiscal year.

Street fixture and display networks revenue (generated from Dalian and Shenyang market) increased 26% year-over-year, city transit system display networks increased 36% and city navigator decreased 74%, both of which are generated solely from Dalian market. Geographically for the 2013 fiscal year, revenue in Dalian, Shanghai, Shenyang, Tianjin, Beijing and US accounted for 76.0%, 3.8%, 5.0%, 2.0%, 11.1% and 2.1% of total revenue. These results compare to 76.5%, 3.0%, 6.7%, 2.3%, 11.5% and 0% for the 2012 fiscal year.

As of June 30, 2013, V Media has installed 52 "City Navigator" units across the Dalian urban area, 3 mega-screen (126 square meters to 400 square meters or 1,356 square feet to 4,306 square feet) LED screens and 8 metal billboards in Dalian, 1 mega-screen (88 square meters or 947 square feet) LED screen in the business district in Shenyang, 1 indoor LED screen (22 square meters or 237 square feet) in Tianjin Railway Station and 5 outdoor billboards in Shanghai. For other platforms, the number of bus shelters and taxi stops increased to 790, the number of buses that carry mobile advertisements is 336 and specifically the number of mobile displays through Dalian metro-trains is 32.

2013 Fiscal Year End Revenue Breakdown by Advertising Platform (USD)

Year ended June 30,

2013

2012

CHANGE

Street Fixture and Display Network

% of Sales

Gross Profit Margin %

$7.0 million

32.3%

29.8%

$5.6 million

30.2%

40.5%

26.3%

City Transit System Display Network

% of Sales

Gross Profit Margin %

$4.1 million

18.8%

39.7%

$3.0 million

16.3%

36.5%

35.8%

Outdoor Billboards

% of Sales

Gross Profit Margin %

$8.5 million

39.2%

36.1%

$8 million

43.3%

43%

6.9%

City Navigator

% of Sales

Gross Profit Margin %

$0.4 million

1.6%

9.8%

$1.4 million

7.3%

62.3%

-74.1%

Other Services Income

% of Sales

Gross Profit Margin %

$1.8 million

8.2%

0.4%

$0.5 million

2.8%

14.2%

240%

Total Sales

$21.8 million

$18.5 million

18.2%

Cost of sales for the year ended June 30, 2013 totaled $18.2 million or 83.6% of revenue, an increase of 69.7% compared to $10.8 million or 58.2% of revenue for the year ended June 30, 2012. The increase in cost of revenue was primarily attributable to increased depreciation of advertising equipment, labor and raw material cost.

Gross profit for the year ended June 30, 2013 totaled $3.6 million, a decrease of 53.7% compared to $7.7 million for the year ended June 30, 2012. The decrease in gross profit was partially attributable to the cost of revenue increase. Gross profit margin was 16.4% and 41.8% for the year ended June 30, 2013 and 2012, respectively. The decrease in gross profit margin during the 2013 fiscal year as compared to the 2012 fiscal year was mainly due to the increased cost of securing new advertising platform, increased maintenance cost of advertising equipment, and the increase of labor and raw material cost during the fiscal year ended June 30, 2013. Specifically, the decrease in outdoor billboard margins was due to the increased amount of new constructions and the lead time needed to build advertising clients.

Selling, general and administrative expenses, which primarily consist of salaries of sales personnel, commissions for sales representatives, rent expenses and related administrative expenses, totaled $7.5 million and $6.6 million for the years ended June 30, 2013 and 2012, respectively, an increase of $0.9 million or 14.6%. The increase was mainly because of the provision of the doubtful accounts.

Net loss attributable to V Media Corp. for the year ended June 30, 2013 totaled $6.1 million, a decrease of $6.1 million as compared to a net income of $50,853 for the year ended June 30, 2012. Basic and diluted loss per share for the year ended June 30, 2013 were $0.22 and $0 based on 27.6 million basic and diluted shares outstanding.

Liquidity and Capital Resources

As of June 30, 2013, V Media had approximately $2.1 million in cash and cash equivalents or $0.08 per share. As of June 30, 2013, total current assets and total assets were $12.7 million and $41.9 million, respectively. During the same period, total current liabilities and total liabilities were $9.6 million and $39.6 million, respectively. Shareholder's equity decreased 25% to $14.8 million for the year ended June 30, 2013, compared to $19.7 million for the year ended June 30, 2012.

About V Media Corp.

Founded in September 2000, Dalian Vastitude Media Group Co., Ltd., now known as V Media Corp., is headquartered in Dalian, the commercial center of Northeastern China. The company owns and operates the city's largest outdoor media network encompassing over 600 bus shelters furnished with billboards and displays; 130 taxi stops with displays; and 18 large-size billboards, including 3 large-size LED displays at major traffic conjunctions. The company also furnishes more than 400 buses with advertising posters and 32 metro-trains throughout Dalian Metro Lines. V Media provides comprehensive adverting services from art design to ad publishing, from daily maintenance to technical upgrading. Launched in Dalian in 2009, V Media's proprietary LED multimedia display network, City Navigator®, is one of the country's first web-based outdoor advertising networks. For more information, please visit www.gywj.cn.

Forward-Looking Statements

This press release may contain certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact included herein are "forward-looking statements", including statements regarding the Company's ability to meet its obligations under its various contracts; the timeliness of payments and other economic benefits the Company expects to receive under such contracts; and the Company's ability to maintain its customer relationships and to maintain its ability to pursue its commercial objectives. In addition, the Company's operations are conducted in the PRC and, accordingly, are subject to special considerations and significant risks not typically associated with companies in North America and Western Europe such as risks associated with, among others, the political, economic and legal environment and foreign currency exchange. The Company's results may be adversely affected by changes in the political and social conditions in the PRC and by changes in governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversion, remittances abroad, and rates and methods of taxation. These forward-looking statements are often identified by the use of forward-looking terminology such as "believes," "expects" or similar expressions, involve known and unknown risks and uncertainties. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. Investors should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the Company's periodic reports that are filed with the Securities and Exchange Commission and available on its website at http://www.sec.gov. Other than as required under the securities laws, the Company does not assume a duty to update these forward-looking statements.

Company Contact:

Rita Jiang
Executive Vice President of Finance
646-691-5047
Rita.jiang@gmail.com  
www.gywj.cn

 

V MEDIA CORP. AND SUBSIDIARIES

(FORMERLY CHINA NEW MEDIA CORPORTATION)

CONSOLIDATED BALANCE SHEETS

(IN US DOLLARS)










As of June 30



As of June 30



2013



2012







ASSETS












Current assets






Cash and cash equivalents


$

2,148,321



$

1,526,604

Restricted cash



3,322,299




-

Accounts receivable, net



4,007,205




4,960,911

Advance to suppliers, net



403,444




413,883

Loans receivable, net



2,425,882




2,099,493

Other current assets



397,110




195,701

Deferred tax assets



-




396,961

Total current assets



12,704,261




9,593,553









Property, equipment and construction in progress, net



23,649,850




23,204,841









Other assets








Billboards use right, net



3,281,728




4,798,745

Security deposits



2,297,952




2,043,750

Total other assets



5,579,680




6,842,495









Total Assets


$

41,933,791



$

39,640,889









LIABILITIES AND EQUITY
















Current liabilities








Short term loans


$

12,579,026



$

11,035,314

Current portion of long term loans



389,876




590,370

Accounts payable



3,194,604




2,274,736

Bank acceptance notes payable



5,214,104




-

Other payables



2,372,044




1,924,191

Deferred revenues



2,392,681




2,649,472

Taxes payable



649,418




507,145

Due to related parties



362,103




594,774

Total current liabilities



27,153,856




19,576,002









Long term loan



-




363,060









Total Liabilities



27,153,856




19,939,062









Commitments and contingencies
















Equity








Series A Preferred Stock, $0.0001 par value, 20,000,000 shares authorized,

1,000,000 shares issued and outstanding



100




100

Common stock, $0.0001 Par value; 80,000,000 shares authorized;

27,590,701 shares issued and outstanding



2,759




2,759

Additional paid-in-capital



6,820,820




6,820,820

Accumulated other comprehensive income



1,122,624




786,806

Retained earnings



4,714,077




10,774,956

Total V Media Corp. equity



12,660,380




18,385,441

Noncontrolling interest



2,119,555




1,316,386

Total equity



14,779,935




19,701,827









Total Liabilities and Equity


$

41,933,791



$

39,640,889

 

V MEDIA CORP. AND SUBSIDIARIES

(FORMERLY CHINA NEW MEDIA CORPORTATION)

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(IN US DOLLARS)









For the years ended June 30,



2013



2012













Revenues


$

21,823,216



$

18,470,685









Cost of revenue



(18,247,311)




(10,750,398)









Gross profit



3,575,905




7,720,287









Selling, general and administrative expenses



(7,548,595)




(6,586,810)









Income (loss) from operations



(3,972,690)




1,133,477









Other income (expenses):








Interest income



47,243




5,279

Interest expense



(1,359,366)




(1,236,432)

Subsidy income



720,390




718,984

Other expenses



(256,856)




(35,412)









Total other expenses



(848,589)




(547,581)









Income (loss) before income taxes



(4,821,279)




585,896









Income tax provision (benefit)








Current



458,845




492,080

Deferred



416,220




(265,273)

Total income tax provision



875,065




226,807









Net income (loss)



(5,696,344)




359,089









Less: net income attribute to the noncontrolling interest



364,535




308,236









Net income (loss) attributable to V Media Corp.


$

(6,060,879)



$

50,853

















Net income (loss)



(5,696,344)




359,089









Other comprehensive income








Foreign currency translation adjustments



439,849




167,695









Comprehensive income (loss)



(5,256,495)




526,784









Less: comprehensive income attributed to the noncontrolling interest



468,566




325,425









Comprehensive income (loss) attributable to V Media Corp.


$

(5,725,061)



$

201,359









Earnings (loss) per share








Basic and diluted


$

(0.22)



$

0.00

Weighted average number of common shares








Basic and diluted



27,550,701




27,550,701

 

V MEDIA CORP. AND SUBSIDIARIES

(FORMERLY CHINA NEW MEDIA CORPORTATION)

CONSOLIDATED STATEMENTS OF CASH FLOWS

(IN US DOLLARS)









For the years ended June 30,



2013



2012







CASH FLOWS FROM OPERATING ACTIVITIES:






Net income (loss)


$

(5,696,344)



$

359,089

Adjustments to reconcile net income (loss) to net cash

provided by operating activities:








Depreciation



2,494,683




2,274,967

Amortization



7,131,973




2,586,577

Amortization of stock based compensation expense



-




24,804

Loss on sale of property



80,917




-

Loss from equity investment



70,973




11,868

Provision for doubtful accounts-Accounts receivable



1,295,654




197,736

Provision for doubtful accounts-loans receivable



916,194




-

Deferred tax provision (benefit)



403,764




(265,273)

Changes in operating assets and liabilities








Accounts receivable



(187,398)




330,633

Advance to suppliers



(72,501)




216,445

Other current assets



(275,111)




314,140

Security deposit



(179,077)




(54,495)

Accounts payable



825,138




2,651,796

Other payables



238,558




(316,448)

Deferred revenues



(343,949)




1,002,852

Taxes payable



122,250




(566,783)









            Net cash provided by operating activities



6,825,723




8,767,908









CASH FLOWS FROM INVESTING ACTIVITIES:








Loans to third party, net



(1,067,199)




(307,809)

Equity investment



-




(94,440)

Proceeds from sale of property



208,127




-

Acquisition of billboards use rights



(5,478,069)




(2,536,601)

Purchase of property and equipment



(2,418,373)




(6,285,222)









            Net cash used in investing activities



(8,755,514)




(9,224,072)









CASH FLOWS FROM FINANCING ACTIVITIES:








Restricted cash



(3,264,323)




-

Net proceeds from capital contributions



334,603




-

Proceeds from (repayment of) short-term bank loans



1,135,090




(769,686)

Net proceeds from bank acceptance notes payable



5,123,115




-

Proceeds from (repayment of) related party loans



(253,172)




431,130

Proceeds from (repayment of) long-term loans



(586,697)




481,230









            Net cash provided by financing activities



2,488,616




142,674









EFFECT OF EXCHANGE RATE CHANGE ON

CASH AND CASH EQUIVALENTS



62,892




31,214









NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS



621,717




(282,276)









CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR



1,526,604




1,808,880









CASH AND CASH EQUIVALENTS, END OF YEAR


$

2,148,321



$

1,526,604









SUPPLEMENTAL CASH FLOW DISCLOSURES








   Income taxes paid


$

239,068



$

1,298,242

   Interest paid


$

1,057,447



$

945,633

 

SOURCE V Media Corp.



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