China Yida Reports Record Results for the First Quarter 2010
FUZHOU, China, May 14 /PRNewswire-Asia-FirstCall/ -- China Yida Holding Company (Nasdaq: CNYD) ("China Yida" or the "Company"), a leading diversified entertainment and media enterprise in China, today announced record financial results for the quarter ended March 31, 2010.
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First Quarter 2010 Highlights
-- Total net revenue increased 50.7% to $14.8 million, compared to $9.8
million in the first quarter of 2009
-- Net revenue from the tourism business increased 86.8% year over year to
$6.0 million
-- Net revenue from the media business increased 33.0% year over year to
$8.8 million
-- Operating income grew 43.8% to $9.6 million, compared to $6.7 million
in the first quarter of 2009
-- Net income increased 43.5% to $7.1 million, compared to $4.9 million in
the same period last year
-- Fully diluted EPS was $0.37 per share, compared to $0.07 in the first
quarter of 2009, or $0.28 after adjustment of 1-for-4 reverse split
approved by our board on April 23, 2009
-- Closed a registered direct offering of 2,489,721 common shares at a
purchase price of $11.50 per share for net proceeds of approximately
$28.6 million.
Dr. Chen Minhua, Chairman and Chief Executive Officer of China Yida, stated, "We are very pleased to report strong profitable growth for the first quarter of 2010, driven by the increase in visitors to our Great Golden Lake park, as well as higher advertising revenue from FETV, and revenue contribution from Hua'An Tulou and railway media. We recently signed two new tourism projects outside the Fujian Province to further expand our capacity to take advantage of the flourishing tourism and leisure market in China. As we look to the future, we feel confident that our track record of execution, industry leading portfolio of tourism and media assets, and strong pipeline of new opportunities positions well to participate in the expected growth of the leisure industry in China."
First Quarter 2010 Results
Total net revenue increased by 50.7% to $14.8 million, compared with $9.8 million in the first quarter of 2009.
Tourism Business
Net revenue from the tourism business increased 86.8% to $6.0 million, compared with $3.2 million in the first quarter of 2009.
For the first quarter of 2010, the Great Golden Lake generated $4.9 million in revenues with the total number of visitors increasing 26% year over year to around 161,000. Hua'An Tulou accepted 65,000 visitors, and contributed revenue of $1.17 million in this quarter. There was no revenue from Hua'An Tulou during the first quarter of 2009.
Media Business
Net revenue from the media business grew 33.0% to $8.8 million, compared with $6.6 million in the same period of last year.
Advertising revenue from FETV during the first quarter of 2010 was approximately $7.7 million, an increase of 17.5% year over year, which was increase in sale of airtime. The "Journey through China on a Train" infomercial program generated $1.0 million in revenue for the quarter, compared to zero in the corresponding period of last year. This program is now reaching approximately 200 million passengers each year.
Gross profit for China Yida's consolidated operations was $11.9 million in the first quarter of 2010, with gross margin of 80.3%, compared to $8.3 million and 84.7% for the comparable period of 2009, respectively. The decrease in gross margin was mainly due to higher costs for ramping-up new projects in their early stages including Hua'An Tulou and "Journey through China on the Train."
Total operating expense increased by 38.6% to $2.3 million in the first quarter of 2010, compared with $1.6 million in the first quarter of 2009. Higher operating expenses were driven primarily by the increase in selling expenses to support the launch of our new businesses.
Operating income increased by 43.8% to $9.6 million, compared with $6.7 million a year ago. Operating margin for the first quarter of 2010 was 65.0%, compared with 68.2% for the first quarter of 2009.
Net income for the first quarter of 2010 was $7.1 million, or $0.37 per diluted share, an increase of 43.5%, compared with a net income of $4.9 million, or $0.07 per diluted share (or $0.28 after adjustment of 1-for-4 reverse split approved by our board on April 23, 2009), in the first quarter of 2009.
Financial Condition
As of March 31, 2010, the Company reported $31.1 million in cash and cash equivalents. Working capital was $27.1 million with a current ratio of 5.8. As of March 31, 2010, the Company had $111.3 million in shareholders' equity compared to $77.7 million at the end of 2009.
China Yida generated $7.8 million in cash flow from operating activities in the first quarter of 2010 and spent $9.1 million on capital expenditures, which were primarily used for the construction of entertainment facilities at Yunding Park and Hua'An Tulou. For the rest of year 2010, the Company expects a residual scheduled payment of approximately $10 million related to the construction of Yunding Park, and approximately $1 million related to Hua'An Tulou. The Company has also budgeted approximately $35 million related to the new projects in Anhui and Jiangxi province in 2010, the Company closed a registered direct offering of 2,489,721 common shares at a purchase price of $11.50 per share for net proceeds of approximately $28.6 million. Management believes the current cash and operating cash flow will be sufficient to fund the company's ongoing projects and growth strategy.
Recent Development
On April 15, 2010, China Yida jointly with Anhui Xingguang Investment Group Ltd., entered into an agreement with Bengbu Municipal Government to develop the Ming Dynasty Entertainment World in the southeast part of Bengbu, Anhui Province, which covers a total area of approximately 5000 Mu (approximately 824 acres as 1 acre = 6.07 Mu).
On April 18, 2010, China Yida entered into an agreement with Zhangshu Municipal Government to develop China Yang-sheng (Nourishing Life) Paradise project, a large-scale vacation destination covering a total area of approximately 6000 Mu (approximately 988 acres), in Zhangshu City, Jiangxi Province. The Project is designed to focus on the theme of famous Taoist practice - Yang-sheng (Nourishing Life), with Zhangshu City's rare natural resources - salt water hot spring, and reputation as one of China's traditional medicine and herb centers. Yang-sheng (Nourishing Life) is the foundation of Taoist lifestyle, which is still desired and actively pursued within today's Asian community.
On April 29, 2010, Dr. Minhua Chen, the Company's Chairman and CEO, presided over the opening bell at the NASDAQ Market Site in New York City to celebrate the Company's listing on the NASDAQ Stock Market. The Company's CFO, Mr. George Wung, gave live interviews at the Wall Street Journal and Street.com to introduce China's fast growing tourism market and China Yida's businesses.
Business Outlook
For the media business management expects 2010 organic growth of 5-10% in advertising revenues from FETV. As the initial phase defined in the management agreement with FETV station will expire in July 2010, the management has started negotiation to secure the extended management term. As of this date, the negotiation is going well and within management's expectations. In addition, the Company will continue its marketing efforts to expand the advertising client base for the "Journey through China on a Train" infomercial program.
Management believes the Company's tourism business will achieve strong growth in 2010 both at existing and newly opened tourist attractions. The high-speed train between Fuzhou and Xiamen was put into use in April 2010, which makes the transportation much easier between the two largest cities of Fujian Province. The management expects that the high speed train will help bring more visitors to their tourism destinations in Fujian Province. Also, the expressway connecting Wuyi Mountain and the Great Golden Lake is expected to be completed and put into use by September 2010, which the management believes will greatly benefit the Great Golden Lake destination. The construction of Yunding Park however, has been affected by poor weather. Management is working hard to catch up on the schedule and looks forward to opening the park to tourists in September 2010, i.e. prior to China's National Holiday.
"We currently have two world class tourism destinations - Great Golden Lake and Hua'an Tulou - under operation with strong growth, and a new large recreational park - Yunding Park - opening to visitors soon. In addition, we have two promising projects outside Fujian Province which we expect will come on line in 2012. As we leverage our strong tourism management expertise and our portfolio of premium media assets, we believe China Yida to deliver long term sustainable growth and to create meaningful and lasting value to our shareholders," Dr. Chen Minhua added.
Conference Call
China Yida will hold a conference call at 10:00 a.m. Eastern Time on Friday, May 14, 2010 to discuss financial results for the first quarter ended March 31, 2010. To participate in the live conference call, please dial the following number five to ten minutes prior to the scheduled conference call time: 866-672-3985. International callers may dial 706-902-4207. The conference ID for this call is 74921334. If you are unable to participate in the call at this time, a replay will be available for two weeks starting on Friday May 14, 2010 at 10:00 a.m. EDT. To access the replay, dial 800-642-1687, international callers may dial 706-645-9291. The Conference Replay pass-code is 74921334.
About China Yida
China Yida is a leading diversified entertainment enterprise focused on China's fast-growing tourism and media industries and headquartered in Fuzhou City, Fujian province of China. The Company's media business provides operations management services; including channel, column and advertisement management for television station, presently the Fujian Education Television Station ("FETV", a top-rated provincial education television channel), and "Journey through China on the Train" (an advertisement-embedded travel program). Additionally, the Company provides tourism management services, and specializes in the development, management and operation of natural, cultural and historic scenic sites. China Yida currently operates the Great Golden Lake (Global Geopark), Hua'An Tulou Cluster (World Culture Heritage), China Yunding (National Park), the Ming Dynasty Entertainment World and China Yang-sheng (Nourishing Life) tourist destination. For further information, please contact the Company directly, or visit its Web site at http://www.yidacn.net .
Forward-Looking Statements
Certain statements in this press release that are not historical facts are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements may be identified by the use of words such as "anticipate, "believe," "expect," "future," "may," "will," "would," "should," "plan," "projected," "intend," and similar expressions. Such forward-looking statements, involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of China Yida Holding Co., Inc. (the "Company") to be materially different from those expressed or implied by such forward-looking statements. The Company's future operating results are dependent upon many factors, including but not limited to: (i) the Company's ability to obtain sufficient capital or a strategic business arrangement; (ii) the Company's ability to build and maintain the management and human resources and infrastructure necessary to support the anticipated growth of its business; (iii) competitive factors and developments beyond the Company's control; and (iv) other risk factors discussed in the Company's periodic filings with the Securities and Exchange Commission, which are available for review at www.sec.gov.
FINANCIAL TABLES FOLLOW
CHINA YIDA HOLDING CO. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME
FOR THE THREE MONTHS ENDED MARCH 31, 2010 AND 2009
(UNAUDITED)
2010 2009
Net revenue
Advertisement $8,767,284 $6,592,187
Tourism 6,035,514 3,230,718
Total net revenue 14,802,799 9,822,906
Cost of revenue
Advertisement 1,826,018 1,372,523
Tourism 1,096,832 128,226
Total cost of revenue 2,922,850 1,500,750
Gross profit 11,879,949 8,322,156
Operating expenses
Selling expenses 978,584 430,647
Operating and
administrative expenses 1,283,944 1,202,198
Total operating expenses 2,262,528 1,632,845
Income from operations 9,617,421 6,689,311
Other (income) expense
Other (income) expense, net (8,853) 1,269
Interest income (8,971) (13,634)
Total other (income) expense, net (17,824) (12,364)
Income before income taxes 9,635,245 6,701,675
Provision for income taxes 2,501,196 1,730,801
Net income 7,134,049 4,970,874
Other comprehensive income
Foreign currency translation
gain (296,766) (13,028)
Other comprehensive income $6,837,283 $4,957,846
Basic net earnings per share $0.38 $0.07
Basic weighted average shares
outstanding 18,918,681 68,084,487
Diluted net earnings per
share $0.37 $0.07
Diluted weighted average
shares outstanding 19,384,447 68,084,487
CHINA YIDA HOLDING CO. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
AS OF MARCH 31,2010 AND DECEMBER 31, 2009
(UNAUDITED)
ASSETS
March 31, December 31,
2010 2009
Current assets
Cash and cash equivalents $31,064,720 5,776,678
Accounts receivable 7,401 2,003
Other receivable 201,463 190,424
Advances and prepayments 1,509,319 1,432,138
Total current assets 32,782,902 7,401,242
Property, and equipment, net 32,590,213 32,995,885
Construction in progress 45,623,520 36,730,184
Intangible assets, net 7,480,711 7,874,938
Long term prepayments 1,009,347 1,012,230
Total assets $119,486,694 86,014,478
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable $49,802 57,277
Short term loans 1,726,130 1,731,060
Other payable 1,089,139 1,145,564
Tax payables 2,825,837 2,835,655
Total current liabilities 5,690,908 5,769,555
Long term debts 2,483,817 2,495,190
Total liabilities 8,174,725 8,264,745
Commitments and contingencies
Stockholders' equity
Common stock ($0.0001 par
value, 100,000,000 shares
authorized, 19,551,785 and
17,062,064 issued and
outstanding as of March 31,
2010 and December 31, 2009,
respectively) 1,955 1,706
Additional paid in capital 48,436,088 21,711,384
Accumulated other comprehensive
income 2,893,396 3,190,162
Retained earning 56,680,841 50,297,151
Statutory reserve 3,299,689 2,549,330
Total stockholders' equity 111,311,970 77,749,733
Total liabilities and
stockholders' equity $119,486,694 86,014,478
CHINA YIDA HOLDING CO. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 2010 AND 2009
(UNAUDITED)
2010 2009
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income $7,134,049 $4,970,874
Adjustments to reconcile net
income to net cash
Cash provided by operating
activities:
Depreciation 367,494 354,336
Amortization 371,804 372,242
Stock based compensation 41,997 --
Changes in operating assets and
liabilities:
Accounts receivables (25,349) 50,501
Other receivables (144,364) (629,516)
Advances and prepayments (79,926) (53,686)
Accounts payable and accrued
expenses (7,314) (1,538)
Tax payable (1,743) 1,236,890
Customer deposit (344) 22,884
Accrued payroll (1,379) (11,746)
Other payable 98,560 392,545
Net cash provided by operating
activities 7,753,486 6,703,785
CASH FLOWS FROM INVESTING
ACTIVITIES
Additions to property &
equipment (55,783) (64,548)
Addition to construction in
progress (8,998,027) (7,662,370)
Net cash used in investing
activities (9,053,809) (7,726,918)
CASH FLOWS FROM FINANCING
ACTIVITIES
Issuance of shares for cash 26,682,956 --
Borrowings -- 2,167,545
Net cash provided by financing
activities 26,682,956 2,167,545
EFFECT OF EXCHANGE RATE CHANGES
ON CASH AND CASH EQUIVALENTS (94,589) 107,624
NET INCREASE IN CASH AND CASH
EQUIVALENTS 25,382,632 1,252,036
CASH AND CASH EQUIVALENTS,
BEGINNING BALANCE 5,776,678 8,715,048
CASH AND CASH EQUIVALENTS, ENDING
BALANCE $31,064,720 $9,967,084
SUPPLEMENTAL DISCLOSURES:
Cash paid during the quarter for:
Income tax payments $2,525,972 $511,212
Interest payments $70,403 $20,243
For more information, please contact:
China Yida Holding Company
George Wung CFO
Phone: +1-909-843-6358
Email: [email protected]
CCG Investor Relations
Crocker Coulson, President
Phone: +1-646-213-1915
Ed Job, CFA
Phone: +86-21-5175-7780
Email: [email protected]
SOURCE China Yida Holding Company
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