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Tuesday, March 23, 2010

CCME - Blow Out Earnings & Guidance

China MediaExpress Holdings, Inc. Announces 2009 Fourth Quarter and Year-End Financial Results

Fourth Quarter Revenue and Net Income Increased by 90.6% and 99.6%, Respectively

Announces 2010 Net Income Guidance

CCME $1.80 EPS for 2010 without acquisitions throwing off huge crash and growth !!!

FUJIAN, China--(BUSINESS WIRE)--China MediaExpress Holdings, Inc. (NYSE Amex: CCME) (“CME” or “Company”), China’s largest television advertising operator on inter-city express buses, today announced financial results for the fourth quarter and year ended December 31, 2009.

Financial Highlights – Fourth Quarter 2009 vs. Fourth Quarter 2008

* Revenue increased by 90.6% to $32.0 million in the fourth quarter of 2009 as compared to $16.8 million in the same quarter of 2008;
* Gross margin for fourth quarter was 68.9%;
* Income from operation increased by 104.7% to $19.5 million in the fourth quarter of 2009 as compared to $9.5 million in the same quarter of 2008; and
* Net income increased by 99.6% to $14.3 million in the fourth quarter of 2009 compared to $7.2 million in the same quarter of 2008.

Financial Highlights – Full Year 2009 vs. Full Year 2008

* Revenue increased 52.3% to $95.9 million in 2009 as compared to $63.0 million in 2008;
* Gross margin for year ended December 31, 2009 was 65.7%;
* Income from operation increased by 61.3% to $56.6 million in 2009 as compared to $35.1 million in 2008;
* Net income increased by 58.2% to $41.7 million in 2009 as compared to $26.4 million in 2008; and
* As of December 31, 2009, the Company had $57.2 million in cash.

Zheng Cheng, CME’s Founder and CEO, commented, “2009 has been an exciting and eventful year for our Company. We started the year as a privately-held business and concluded as a publicly owned company trading on the NYSE Amex. Since our inception in 2003, we have been working hard to successfully grow CME to a multi-million dollar company and to become the market leader in the express bus advertising industry in China. 2009 was the best year in our history as we continued the rapid organic growth of our business by: signing new contracts with additional bus operators partners, both in the areas where we have a strong presence and in new areas as well; entering into exclusive agreements with several operators of airport express buses, broadening our revenue sources to further augment our potential revenue growth through providing additional advertising channels to advertisers and new services to passengers such as the broadcast of the embedded advertisements which are displayed during the broadcasting of the content; and exploring a number of avenues to further grow our market share and geographic coverage through possible acquisitions.”

Discussing 2009 fourth quarter and year-end results, Mr. Cheng noted, “As expected, our fourth quarter was the strongest quarter of the year. Our revenue for the quarter grew by 22.3%, 67.4% and 70.2% compared to the third, second and first quarters of 2009, respectively. Also net income for the quarter increased by 22.7%, 72.8% and 92.0% compared to the third, second and first quarters of 2009, respectively.

He added, “Our network has grown with the signing of several new agreements with bus operators. As of today, our network includes 49 bus operator partners, up from 46 at the end of November; these agreements run from three to eight years. The total number of buses equipped with our television systems is now over 21,000, increasing approximately by more than 1,000 buses since the end of November.”

Mr. Cheng continued, “Our successful platform, the large and growing network of bus operators partners, the wide geographic coverage and our competitive advertising rates, continue to attract a large number of international and national brands to our advertising network. More than 450 advertisers have purchased time on our network either through advertising agents or directly from us. Our growing clientele includes local brand names as well as well-known international and national brands such as Coca Cola, Pepsi, Wahaha, KFC, Siemens, Hitachi, Haier, China Telecom, China Mobile, Nokia, China Post, Procter & Gamble, Bank of China, China Constructing Bank and China Pacific Life Insurance.

“In addition, we plan to further broaden our revenue sources by providing additional advertising channels to our clients and new services to passengers. These additional revenue sources include: a) separately packaging advertising time slots on airport shuttle buses and tour buses which should generate higher revenue, b) displaying soft advertisements packaged as entertainment content, c) establishing stationary advertising media at inter-city express bus terminals to complement our main business, and d) offering new services to advertisers and passengers by featuring hotels, spa resorts, local restaurants on our network along with relevant contact information of service providers and charge advertising fees.

“We remain focused on improving our profit margins by attracting more direct advertising clients. As a result, at the end of 2009 direct clients accounted for 21% of our net revenues, as compared to only 2% at the end of 2008 and 16% at the end of the 2009 third quarter. Our goal is for direct advertising clients to represent approximately 35% our net revenue mix by the end of 2010.”

Jacky Lam, CME’s Chief Financial Officer stated, “In 2009, CME generated approximately $46.2 million of cash from operating activities, of which $16.4 million were generated in the fourth quarter. Our cash position remains very strong and as of December 31, 2009, we had $57.2 million of cash.”

Mr. Lam continued, “In January 2010, we completed two important transactions for our Company. The first transaction was a $30 million private investment from Starr International Company, Inc. (“Starr International”), involving newly issued shares of CME Series A Convertible Preferred Stock and CME common stock purchase warrants. We are very pleased that Starr International, a respected investment firm with a significant presence in China and the US, has shown great confidence in our growth prospects and has become one of our major investors.

“The second transaction was the completion of the exercise and redemption of all of our outstanding public warrants, which brought CME net proceeds (after deducting the amounts paid to the original shareholders of CME) of approximately $26 million. Through the redemption we simplified our complicated capital structure, increased the public float, and made CME more attractive to a larger number of institutional investors. In addition, we eliminated the warrant overhang, removed the associated downward pressure on our stock price and the trading volatility associated with arbitrage.”

Mr. Lam added, “As a result of the above two transactions and the settlement of $10 million promissory note due to the CME original shareholders, as of today, we have over $100 million in cash, to fund our business expansion plans, including internal expansion initiatives and potential mergers and acquisitions of local companies capable of delivering customized, time-specific and local-oriented content.”

Pursuant to the earn-out provisions of the share exchange agreement (“Share Exchange Agreement”) entered into in connection with the Company’s initial business combination with TM Entertainment and Media, CME anticipates issuing the original founding shareholders of the Company 1,000,000 common shares. This earn-out issuance is a result of the Company achieving its 2009 adjusted net income (as defined in the Share Exchange Agreement) of $42 million.

Announces 2010 Guidance

Based on the current customer base, geographic coverage, network of express buses and existing revenue streams, CME’s management projects that its 2010 net income (non-GAAP which is before share based compensation or fair value adjustments for the Company’s financial instruments), will be in the range of $71 million to $75 million. These projections exclude the impact of any possible acquisitions, additional of new buses and new investments in other media projects in 2010.”

Mr. Cheng concluded, “We believe that our Company is well positioned to further benefit from the rapid growth in the advertising spending in China, the second largest advertising market in Asia, and one of the largest and fastest growing markets in the world. We are very proud of our success and are confident that our Company has a bright future.”

3 comments:

Dave said...

1st to post

lionmaster is a cocksucker

Anonymous said...

2nd to post

lionmaster takes it in the ass

Anonymous said...

CCME is doing better than Lionmaster's recent picks, MSN, ACAD, PALM and DDSS combined! Rock solid DD by Superman vs "fastest (and loose) DD" by Lionmaster. Great job again Superman!

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