China Yida Reports Record Fourth Quarter and Fiscal Year 2009 Results
FUZHOU, China, March 23 /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 financial results for the fourth quarter and fiscal year ended December 31, 2009.
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Fourth Quarter 2009 Highlights
-- Total net revenue increased 58.1% to $14.5 million, compared to $9.2
million in the fourth quarter of 2008
-- Net revenue from the tourism business increased 112.5% year over year
to $6.0 million, with a gross margin of 60.2%
-- Net revenue from the media business increased 34.2% year over year to
$8.5 million, with a gross margin of 91.1%
-- Gross profit grew 61.7% to $11.4 million, compared to $7.0 million in
the same period last year
-- Operating income grew 97.9% to $9.6 million, compared to $4.9 million
in the fourth quarter of 2008
-- Net income increased 27.5% to $5.9 million, compared to $4.7 million in
the same period last year
-- Fully diluted EPS was $0.34 per share, compared to $0.27 in the fourth
quarter of 2008
-- Opened Shangping Tulou cluster, part of Hua'An Tulou's World Heritage
tourism destination
-- Listed its common stock on the NASDAQ Capital Market
Full Year 2009 Highlights
-- Total net revenue increased 67.4% to $51.2 million, compared to $30.6
million in 2008
-- Net revenue from the tourism business increased 170.7% year over year
to $20.0 million, with a gross margin of 79.5%
-- Net revenue from the media business increased 35.2% year over year to
$31.5 million, with a gross margin of 79.2%
-- Gross profit grew 77.4% to $40.6 million, compared to $22.9 million in
2008
-- Operating income grew 81.1% to $34.4 million, compared to $19.0 million
in 2008
-- Net income increased 39.4% to $25.5 million, compared to $18.3 million
in 2008
-- Fully diluted EPS was $1.47 per share, compared to $1.27 in 2008
-- Re-opened Hua'An Tulou Cluster including Shangping Tulou
-- Entered into a six-year exclusive agreement with China's Railway Media
Center to create "Journey through China on the Train" infomercial
programs
Dr. Chen Minhua, Chairman and Chief Executive Officer of China Yida, stated, "We are very pleased to report another quarter of record results, and particularly delighted with the triple-digit year-over-year growth of our tourism business. The strong growth was the combined result of the increase in number of tourist destinations under management, marketing efforts nationwide as well as favorable macro-economic policies, which aim to promote Chinese domestic consumption to reduce reliance on exports. Our advertising business also experienced strong growth this quarter and delivered superior profitability because of higher demand for airtime at FETV. In addition we further expanded the coverage of our 'Journey through China on a Train' infomercial program to 36 rail lines and 738 trains as of the end of 2009. This program is an important part of our strategy to raise awareness about our tourism destinations all over the country."
Fourth Quarter 2009 results
Total net revenue increased by 58.1% to $14.5 million, compared with $9.2 million in the fourth quarter of 2008.
Tourism Business
Net revenue from the tourism business increased 112.5% to $6.0 million, compared with $2.8 million in the fourth quarter of 2008. Cost of revenue from the tourism business, mainly consisting of Chinese business tax at a rate of 5%, tickets profit sharing with local government, and depreciation of fixed assets at tourism destinations, was $2.4 million, up 1552.5% from $0.14 million in the same period of last year. Gross margin from the tourism business was 60.2% for the fourth quarter of 2009, compared to 94.9% a year ago. The year-over-year decrease was because tickets profit sharing and depreciation expenses of the fixed assets at tourism destinations were reclassified from Operating Expenses to Cost of Revenue in the fourth quarter of 2009. These changes were made to more accurately reflect the way in which the segment's results are reported. Certain reclassifications have been made to prior period amounts to conform to the current period presentation.
During the fourth quarter of 2009, the total number of visitors that entered the Great Golden Lake was around 163,000, an increase of 63%, compared with 100,000 in the same period of last year. Revenue from the Great Golden Lake totaled $4.9 million for the fourth quarter of 2009.
During the fourth quarter of 2009, Hua'An Tulou accepted 55,000 visitors, and contributed $1.03 million of revenues to the Company.
Media Business
Net revenue from the media business grew 34.2% to $8.5 million, compared with $6.4 million in the same period of last year. This increase was due to higher demand for airtime at FETV. By the end of 2009, FETV's audience rating was 0.58, compared to 0.56 at the end of 2008 and 0.12 at the end of 2003.
Cost of revenue from the media business, mainly including Chinese business tax at a rate of 8.5%, procurement cost for TV programs and depreciation of media equipment, was $0.8 million, down 64.6% from $2.2 million in the same period of last year. The decrease was mainly because of much lower TV program procurement cost in the fourth quarter of 2009. Gross margin for the media business was 91.1% for the fourth quarter of 2009, compared to 61.1% a year ago.
Gross profit for China Yida's consolidated operations was $11.4 million in the fourth quarter of 2009, representing a gross margin of 78.4%, compared to $7.0 million and 76.7 % for the comparable period of 2008.
Total operating expense decreased by 19.0% to $1.8 million in the fourth quarter of 2009, compared with $2.2 million in the fourth quarter of 2008. Selling expenses and G&A expenses for the three months ended December 31, 2009 decreased 2.2% and 31.3% year over year to $0.9 million and $0.9 million respectively. The Company's selling activities and daily operations in the fourth quarter of 2009 were in line with its increased revenues. The year-over-year decrease was because tickets profit sharing and depreciation expenses of the fixed assets at tourism destinations were reclassified from Operating Expenses to Cost of Revenue in the fourth quarter of 2009. These changes were made to more accurately reflect the way in which the segment's results are reported. Certain reclassifications have been made to prior period amounts to conform to the current period presentation.
Operating income increased by 97.9% to $9.6 million, compared with $4.9 million a year ago. Operating margin for the fourth quarter of 2009 was 66.2%, compared with 52.9% for the fourth quarter of 2008.
Net income for the fourth quarter of 2009 was $5.9 million, or $0.34 per diluted share, an increase of 27.5%, compared with a net income of $4.7 million, or $0.27 per diluted share, in the fourth quarter of 2008.
Full Year 2009 Results
Total net revenue increased by 67.4% to $51.2 million, compared with $30.6 million in 2008.
Net revenue from the media business increased by 35.2% to $31.5 million, driven by higher demand for airtime at FETV. Currently, FETV's airtime is sold mainly through 15 advertising agencies, which are long-term partners of China Yida. The three largest distributors accounted for 20% of FETV's revenue in 2009.
Net revenue from the tourism business increased by 170.7% to $19.7 million, as compared to $7.3 million in 2008. The increase was primarily attributable to higher number of visitors to the Great Golden Lake, which increased from approximately 320,000 in 2008 to approximately 640,000 in 2009, as well as the revenue contributed by Hua'An Tulou, which was reopened in 2009. In 2009, Hua'An Tulou had 95,000 visitors, and contributed over $1.7 million to the Company's total revenue. The Company expects to attract 160,000 visitors in 2010 to this destination.
Gross profit for 2009 increased 77.4% year over year to $40.6 million, with gross margin of 79.3%. Operating income increased 81.1 % year over year to $34.4 million, mainly because of increasing costs of maintenance and promotion for the Great Golden Lake.
Provision for income taxes in 2009 was $8.9 million, representing an effective tax rate of 25.9%, compared to $0.7 million and 3.5% in 2008. The increase of effective tax rate was because the income tax exemption for our advertising operation, the FETV, expired by the end of 2008. The statutory income tax rate for the Company's different business lines was 25% in 2009.
Net income was $25.5 million, or $1.47 per fully diluted share, an increase of 39.4% compared with a net income of $18.3 million, or $1.27 per share, for 2008.
Financial Condition
As of December 31, 2009, the Company reported $5.8 million in cash and cash equivalents. Working capital was $1.6 million with a current ratio of 1.3. The Company also reported $2.5 million in bank loan, which is due in March 2012. As of December 31, 2009, the Company had $77.7 million in shareholders' equity compared to $52.1 million at the end of 2008.
On January 28, 2010, the Company closed a registered direct offering of 2,489,721 common shares at a purchase price of $11.50 per share for aggregate proceeds of approximately $28.6 million. After giving effect to the registered direct offering, the Company will have 19,551,785 shares of common stock outstanding.
China Yida generated $30.0 million in cash flow from operating activities in 2009 and spent $36.1 million on capital expenditures, which were primarily used for the construction of entertainment facilities at Yunding Park and Hua'An Tulou cluster. The Company expects a residual scheduled payment of $10.0 million in 2010 related to the construction of Yunding Park. Management believes the current cash and operating cash flow will be sufficient to fund the company's ongoing projects and growth strategy.
2010 Outlook and Guidance
In 2010, management expects a moderate organic growth in advertising revenues from FETV. The Company will continue its marketing efforts to expand the coverage of 'Journey through China on a Train' infomercial program all over China. During the first half of 2010 management expect this program to reach 44 rail lines.
On November 25, 2009, China's State Council approved Guidelines to Accelerate the Development of the Tourism Industry in China, defining it as a strategic pillar of the national economy, which will create a more favorable industry environment for China Yida.
The Company will also benefit from rapidly growing consumer spending on leisure activities in China as a result of increased disposable income and a growing middle class. With GDP per capita in China currently at US$3,000 growth in tourism is expected to accelerate.
Management believes the Company's tourism business will achieve strong growth in 2010 both at existing and newly opened tourist attractions. The expressway connecting Wuyi Mountain and the Great Golden Lake is expected to be completed and put into use by September 2010, which management believes will bring more tourists to the Great Golden Lake destination. The construction of Yunding Park was affected by too many unexpected rainy days and the management now expects to open it to visitors in the third quarter of 2010.
"Our successful business model, proven management capability and access to capital continue to bring many new opportunities from different provinces in China. We are now carefully evaluating these new projects in order to provide shareholders with the most ideal investment opportunities and hope to be in a position to make an announcement in the near future," Dr. Chen Minhua added.
Conference Call
China Yida will hold a conference call at 09:00 a.m. Eastern Time on Tuesday, March 23, 2010 to discuss its fourth quarter and fiscal year 2009 results. 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 63519136. If you are unable to participate in the call at this time, a replay will be available for two weeks starting on Tuesday, March 23, 2010 at 12:00 p.m. EDT. To access the replay, dial 800-642-1687, international callers may dial 706-645-9291. The Conference Replay pass-code is 63519136.
About China Yida
China Yida Holding Co. is a leading diversified entertainment enterprise focused on China's fast-growing media and tourism 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 station), and "Journey through China on the Train" ("CRTV", the only railway on-board media authorized by Ministry of Railways). Additionally, the Company provides tourism management services, and specializes in the investment and development of natural, cultural and historic scenic sites. China Yida currently operates the Great Golden Lake tourist destination (Global Geopark, including Golden Lake, Shangqing River, Zhuanyuan Rock, Luohan Mountain and Taining Old Town.), Hua'An Tulou tourist destination (World Culture Heritage, including Dadi Tulou cluster and the Shangping Tulou cluster), and China Yunding tourist destination (National Park, including Colorful Rock Valley, Yunding Paradise, Yunding Waterfall, South Heavenly Mountain, and Seven Star Lake). The Company's operating scenic sites are over 300 square kilometers in the area. 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 BALANCE SHEETS
AS ON DECEMBER 31, 2009 AND 2008
ASSETS
DECEMBER 31,
2009 2008
Current assets
Cash and cash equivalents $5,776,678 $8,715,048
Accounts receivable 2,003 76,569
Other receivable, net 190,424 76,759
Advances and prepayments 1,432,138 164,169
Total current assets 7,401,242 9,032,546
Property, and
equipment, net 32,995,885 34,173,009
Construction in
progress 36,730,184 1,979,725
Intangible
assets, net 7,874,938 9,358,333
Long term
prepayments 1,012,230 --
Total assets $86,014,478 $54,543,613
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable $57,277 $65,367
Short term loans 1,731,060 1,172,591
Other payable and accrued expenses 1,145,564 462,778
Tax payables 2,835,655 726,524
Total current liabilities 5,769,555 2,427,259
Long term debts 2,495,190 --
Total liabilities 8,264,745 2,427,259
Commitments and contingencies
Stockholders' equity
Preferred stock ($0.001 par value,
10,000,000 shares authorized, 1
share issued and outstanding) -- --
Common stock ($0.0001 par value,
100,000,000 shares authorized and
17,062,064 and 17,021,447 issued
and outstanding as of December
31, 2009 and December 31, 2008,
respectively) 1,706 1,702
Additional paid in capital 21,711,384 21,627,394
Accumulated other comprehensive
income 3,190,162 3,134,077
Retained earning 50,297,151 27,353,181
Statutory reserve 2,549,330 --
Total stockholders' equity 77,749,733 52,116,354
Total liabilities and stockholders'
equity $86,014,478 $54,543,613
CHINA YIDA HOLDING CO. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME
3 Months 3 Months
Year Ended Year Ended Ended Ended
December 31, December 31, December 31, December 31,
2009 2008 2009 2008
Net revenue
Advertisement $31,519,267 $23,319,235 $8,548,798 $6,372,065
Tourism 19,709,684 7,280,258 5,969,787 2,808,965
Total net revenue 51,228,951 30,599,493 14,518,585 9,181,030
Cost of revenue
Advertisement 6,541,382 5,779,082 764,244 2,157,647
Tourism 4,038,708 1,904,329 2,373,251 (17,123)
Total cost of revenue 10,580,090 7,683,411 3,137,494 2,140,524
Gross profit 40,648,861 22,916,082 11,381,091 7,040,506
Operating expenses
Selling expenses 3,108,413 1,456,229 903,285 923,132
Operating and
administrative
expenses 3,145,191 2,463,201 867,170 1,261,798
Total operating
expenses 6,253,605 3,919,430 1,770,455 2,184,930
Income from
operations 34,395,256 18,996,652 9,610,636 4,855,576
Other (income)
expense
Other (income)
expense, net (115) 22,869 (208) 19,786
Interest expense -- 37,168 -- (78,058)
Interest income (28,344) (24,832) 401 (19,277)
Total other (income)
expense, net (28,459) 35,205 193 (77,549)
Income before
income taxes 34,423,715 18,961,447 9,610,443 4,933,125
Provision for
income taxes 8,930,414 670,347 3,670,240 273,779
Net income $25,493,301 $18,291,100 $5,940,203 $4,659,346
Other compre-
hensive income
Foreign currency
translation gain 56,085 2,129,733 (2,724) 70,399
Other compre-
hensive income $25,549,386 $20,420,833 $5,937,479 $4,729,745
Basic net earnings
per share $1.50 $1.27 $0.35 --
Basic weighted
average shares
outstanding 17,023,344 14,395,383 17,029,035 --
Diluted net
earnings
per share $1.47 $1.27 $0.34 --
Diluted
weighted
average
shares
outstanding 17,314,084 14,395,383 17,469,850 --
CHINA YIDA HOLDING CO. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2009 AND 2008
2009 2008
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income $25,493,301 $18,291,101
Adjustments to reconcile net income
to net cash
Cash provided by (used in) operating
activities:
Depreciation 1,447,319 399,884
Amortization 1,490,535 4,264,777
Bad debt expense (4,398) --
Stock based compensation 83,994 --
Changes in operating assets and
liabilities:
Accounts receivables 74,587 (52,128)
Other receivables (143,514) (1,061,873)
Advances and prepayments (1,238,668) 6,932,829
Accounts payable and accrued expenses (7,325) (114,535)
Tax payable 2,107,263 (993,859)
Customer deposit (10,797) (136,255)
Accrued payroll 1,080 55,392
Other payable 691,636 (203,257)
Net cash provided by
operating activities 29,985,012 27,382,076
CASH FLOWS FROM INVESTING ACTIVITIES
Additions to property & equipment (275,929) (25,364,501)
Addition to construction in
progress (34,793,109) (1,652,510)
Purchase of intangible assets -- (6,476,964)
Increase in long-term prepayment (1,011,609) --
Net cash used in investing activities (36,080,646) (33,493,975)
CASH FLOWS FROM FINANCING ACTIVITIES
Issuance of shares for cash -- 13,027,250
Borrowings under loan renewal 3,048,673 607,928
Net cash provided by
financing activities 3,048,673 13,635,178
EFFECT OF EXCHANGE RATE CHANGES ON
CASH AND CASH EQUIVALENTS 108,592 465,139
NET CHANGE IN CASH AND CASH EQUIVALENTS (3,046,962) 7,988,417
CASH AND CASH EQUIVALENTS, BEGINNING
BALANCE 8,715,048 726,631
CASH AND CASH EQUIVALENTS, ENDING
BALANCE $5,776,678 $8,715,048
SUPPLEMENTAL DISCLOSURES:
Non-cash transaction:
Transferred to fixed asset from
construction in progress $-- $25,320,569
Cash paid during the quarter for:
Income tax payments $6,910,558 $317,668
Interest payments $210,319 $109,499
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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