SHANGHAI, June 29 /PRNewswire-FirstCall/ -- China Cablecom Holdings, Ltd. ("China Cablecom" or the "Company") (Nasdaq: CABL) (Nasdaq: CABLW) (Nasdaq: CABLU), a joint-venture provider of cable television services in the People's Republic of China (PRC), announced today its unaudited financial results for the first quarter ended March 31, 2010.
First Quarter 2010 Highlights:
- Hubei revenues were $10.3 million, an increase of 35% over the first quarter of 2009
- Hubei earnings before interest, taxes, depreciation and amortization ("EBITDA") representing the Company's 55% share was $2.5 million, an increase of 87% over the first quarter of 2009
- Hubei added nearly 40,000 subscribers during the quarter
- Binzhou revenues were $3.1 million, an increase of 35% over the first quarter of 2009
- Binzhou EBITDA representing the Company's 60% share was $1.1 million, an increase of 18% over the first quarter of 2009
Comments from Mr. Clive Ng, Founder & Executive Chairman
"We are so pleased to be reporting such a strong quarter," says Clive Ng, Founder and Executive Chairman of China Cablecom. "The performance of both operations in Binzhou and Hubei have exceeded our expectations and delivered significant growth in revenues, EBITDA, subscription, digitization and ARPU. We feel this quarter represents a more accurate reflection on the strength of our business in the long-term and we are excited about the opportunities that lay ahead for the Company and our shareholders."
Financial Results for the First Quarter of 2010
Consolidated revenues for the first quarter of 2010 were $13.4 million compared to consolidated revenues of $10 million for the first quarter of 2009. The increase was due to growth in paying subscribers and revenues generated in subscription and installation fees. Consolidated operating expenses for the first quarter of 2010 were $5.6 million compared to consolidated operating expenses of $5.8 million for the first quarter of 2009.
Effective March 2, 2010, the Company's shareholders approved a one-for-three reverse stock split of all outstanding ordinary shares, as recommended and approved by the Company's Board of Directors. Accordingly, China Cablecom shareholders received one ordinary share of the Company for each three ordinary shares held as of the effective date of the reverse split. This split is retroactively applied to prior year share data for calculation of earnings per share.
Based on U.S. GAAP, net loss attributable to ordinary shareholders for the first quarter of 2010 was $2.3 million or $0.48 per basic and fully diluted share compared to net loss attributable to ordinary shareholders of $5.6 million, or $1.74 per basic and fully diluted share in the first quarter of 2009.
The net loss for the first quarter 2010 was significantly impacted by (1) non-cash amortization of intangible assets which were acquired in connection with China Cablecom's acquisition of Binzhou Broadcasting and Hubei in the amount of $0.37 million and $0.33 million, respectively, (2) non-cash interest expense associated with original issue debt discount and deferred financing costs relating to China Cablecom's senior secured, junior secured and unsecured notes in the amount of $0.88 million, (3) non-cash stock based compensation in the amount of $0.43 million.
Recent Company Highlights
During the first quarter of 2010, China Cablecom's ordinary shares underwent a one-for-three reverse stock split effective March 2, 2010.
In connection with China Cablecom's comprehensive debt restructuring in October 2009, Series B preferred shares were issued, which are convertible at the option of the holder into ordinary shares on a share-for-share basis. Beginning April 2010, over 2.8 million Preferred B shares were converted into ordinary shares and an aggregate of $2.2 million of Cablecom's long-term debt was cancelled as a result.
The Company recently announced a Shandong government initiative to consolidate its provincial cable assets, resulting in a temporary deferment of China Cablecom's obligation to pay outstanding cash payments of approximately $16.5 million to the Binzhou joint venture partners.
China Cablecom estimates total consolidated revenues for the full year of 2010 to be between $50-55 million. This includes total paying subscribers to reach 1.8 million and a consolidated digital subscriber count of 750,000.
Based on these metrics, the Company estimates EBITDA for 2010, to be in the range of $14-15 million, accounting for the 60% economic ownership in Binzhou and 55% economic ownership in Hubei.
The following summary financial and operating highlights for Binzhou and Hubei reflect the results of the respective operating joint ventures on a stand-alone basis and do not include China Cablecom's corporate operations and overhead. EBITDA reflects China Cablecom's consolidated share of 55% and 60% in Hubei Chutian and Binzhou Broadcasting, respectively.
Quarter ended March 31,
EBITDA - 60% share
EBITDA - 55% share
Total EBITDA - CABL's share
nm = not meaningful
Conference Call and Webcast
China Cablecom's management team will host a conference call today at 8:30 a.m. EDT, June 29, 2010 (or 8:30 p.m., June 29, 2010 Shanghai time). To listen to the conference call, please use the dial in numbers below:
USA Toll Number: 1-877-941-2332
A replay of the call will be available for two weeks following the call and can be accessed by dialing the numbers below:
USA Toll Number: 1-800-406-7325
The conference call will be available on webcast live and available for replay at: www.chinacablecom.net.
About China Cablecom Holdings
China Cablecom is a joint-venture provider of cable television services in the People's Republic of China, operating in partnership with a local state-owned enterprise ("SOE") authorized by the PRC government to control the distribution of cable TV services through the deployment of analog and digital cable services. China Cablecom has consummated the acquisition of a 55 percent economic interest in a cable network in Hubei province with paying subscribers exceeding 1,200,000. The Company originally acquired operating rights of the Binzhou Broadcasting network in Binzhou, Shandong Province in September 2007 by entering into a series of asset purchase and services agreements with a company organized by SOEs, owned directly or indirectly by local branches of State Administration of Radio, Film and Television in five different municipalities to serve as a holding company of the relevant businesses. China Cablecom now operates 28 cable networks with over 1.7 million paying subscribers. China Cablecom's strategy is to replicate the acquisitions by operating partnership models in other municipalities and provinces in the PRC and then introducing operating efficiencies and increasing service offerings in the networks in which it operates.
Safe Harbor Statement
The matters discussed in this press release contain "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements contained in this presentation and in the Company's other written and oral reports are based on current Company expectations and are subject to risks and uncertainties, which could cause actual results to differ materially. Any forward-looking statements are not guarantees of future performance and actual results of operations, financial condition and liquidity, and developments in the industry may differ materially from those made in or suggested by the forward-looking statements contained herein. These forward-looking statements are subject to numerous risks, uncertainties and assumptions. The forward-looking statements herein speak only as of the date stated herein and might not occur in light of these risks, uncertainties, and assumptions. China Cablecom Holdings undertakes no obligation and disclaims any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. You should carefully consider these factors as well as the additional risk factors outlined in the filings that China Cablecom Holdings makes with the U.S. Securities and Exchange Commission, including the Annual Report on Form 20-F filed with respect to the year ended December 31, 2008.
CHINA CABLECOM HOLDINGS LIMITED
Unaudited Consolidated Balance Sheets
March 31, 2010
December 31, 2009
Cash and cash equivalents
Prepaid expenses and advances
Total Current Assets
Property, Plant & Equipment, net
Construction In Progress
Intangible assets, net
Deferred financing costs, net
LIABILITIES AND SHAREHOLDERS' EQUITY
Service performance obligation – deferred revenue
Other current liabilities
Note payable – noncontrolling interest
Total Current Liabilities
Long Term Liabilities:
Senior secured notes, net of discount
Secured notes, net of discount
Unsecured notes, net of discount
Convertible notes, net of discount
Note payable – noncontrolling interest, net of current portion
Series A convertible preferred shares, $.0005 par value; 70,000,000 authorized shares, 59,980,370 shares issued and outstanding (December 31, 2009 62,161,965 shares issued)
Series B convertible preferred shares, $.0005 par value; 25,000,000 authorized shares, 23,158,080 shares issued and outstanding (December 31, 2009 23,158,080 shares issued)
Ordinary shares, $.0015 par value; 51,666,667 authorized shares, 5,415,333 shares issued and outstanding (December 31, 2009 4,688,151 shares issued)
Additional paid-in capital
Accumulated other comprehensive income
Total liabilities and shareholders' equity
CHINA CABLECOM HOLDINGS LIMITED
Unaudited Consolidated Statements of Operation
Three months ended
Three months ended
March 31, 2010
March 31, 2009
Cost of revenue
General and administrative expenses
Total operating expenses
Loss from operations
Other income / (expenses)
Total other expenses
Loss before income taxes and non-controlling interest
Net loss, net of tax
Less: Net profit attributable to non-controlling interest
Net loss attributable to China Cablecom Holdings, Ltd.
Loss per ordinary share:
- Basic and fully diluted
Weighted average number of shares
- Basic and fully diluted
Reconciliation of Non-U.S. GAAP Measures
This release contains discussion of China Cablecom's revenues, as well as EBITDA. Although EBITDA is not a measure of financial condition or performance determined in accordance with U.S. GAAP, China Cablecom uses EBITDA to value businesses it acquires or anticipates acquiring. EBITDA is not defined in the same manner by all companies and may not be comparable to other similarly titled measures of other companies unless the definition is the same.
Below is a table reconciling certain non- U.S. GAAP financial measures appearing elsewhere herein relating to China Cablecom to the most closely analogous U.S. GAAP measures:
3 Months ended
Net loss attribute to ordinary share holders
Interest & Finance
Stock based compensation
Non-GAAP income (EBITDA)
Reconciliation to operating metrics
Binzhou Broadcasting EBITDA - 60% share
Hubei Chutian EBITDA - 55% share
SOURCE China Cablecom Holdings, Ltd.