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SINA Reports Fourth Quarter and Fiscal Year 2011 Financial Results
Fourth Quarter 2011 Highlights
- Net revenues grew 21% year over year to
$133.4 million . Non-GAAP net revenues grew 23% year over year to$128.7 million , within the Company's guidance of between$128.0 million and $131.0 million . - Advertising revenues grew 26% year over year to a historical high of
$103.7 million , within the Company's guidance of between$103 million and $105 million . - Non-advertising revenues grew 8% year over year to
$29.7 million . Non-GAAP non-advertising revenues grew 11% year over year to$25.0 million , within the Company's guidance of between$25.0 million and $26.0 million . - Net income attributable to
SINA was$9.3 million , or$0.14 diluted net income per share attributable toSINA . Non-GAAP net income attributable toSINA was$14.0 million , or$0.21 non-GAAP diluted net income per share attributable toSINA .
Fiscal 2011 Highlights
- Net revenues grew 20% year over year to
$482.8 million . Non-GAAP net revenues grew 21% year over year to$464.1 million . - Advertising revenues grew 27% year over year to
$368.8 million . - Non-advertising revenues increased 2% year over year to
$114.0 million . Non-GAAP non-advertising revenues increased 3% year over year to$95.3 million . - Net loss attributable to
SINA was$302.1 million , or$4.64 net loss per share attributable toSINA . Net loss included non-cash impairment charges totaling$350.4 million ,$68.9 million of which related to an impairment of MVAS goodwill and the remaining$281.5 million mainly related to other-than-temporary impairment write-downs on investments inChina Real Estate Information Corporation ("CRIC") andMecox Lane Limited ("MCOX"). Non-GAAP net income attributable toSINA was$61.6 million , or$0.92 non-GAAP diluted net income per share attributable toSINA .
"
Fourth Quarter 2011 Financial Results
For the fourth quarter of 2011,
Brand advertising revenues for the fourth quarter of 2011 were
Gross margin for the fourth quarter of 2011 was 54%, down from 58% for the same period last year. Advertising gross margin for the fourth quarter of 2011 was 56%, compared to 60% for the same period last year. Non-GAAP advertising gross margin for the fourth quarter of 2011 was 57%, compared to 61% for the same period last year. The decrease in non-GAAP advertising gross margin was mainly due to increased spending on bandwidth and content, as well as increased production-related personnel costs. MVAS gross margin for the fourth quarter of 2011 declined to 35% from 39% for the same period last year. The decline in MVAS gross margin was primarily due to product mix change and increased revenue share with MVAS partners.
Operating expenses for the fourth quarter of 2011 totaled
Income from operations for the fourth quarter of 2011 was
Non-operating income for the fourth quarter of 2011 was
Net income attributable to
As of
Business Outlook
Non-GAAP Measures
This release contains financial measures that are not prepared in accordance with generally accepted accounting principles in
Reconciliations of the Company's non-GAAP measures to the nearest GAAP measures are set forth in the section below titled "Unaudited Reconciliation of Non-GAAP to GAAP Results." These non-GAAP measures include non-GAAP non-advertising revenues, non-GAAP net revenues, non-GAAP gross profit, non-GAAP advertising gross margin, non-GAAP operating expenses, non-GAAP income from operations, non-GAAP equity income from CRIC, non-GAAP net income attributable to
The Company's management uses non-GAAP financial measures to gain an understanding of the Company's comparative operating performance (when comparing such results with previous periods or forecasts) and future prospects. The Company's non-GAAP financial measures exclude certain items, including stock-based compensation, amortization of intangible assets, recognition of deferred revenues and gain/loss resulting from the disposal, purchase or impairment of a business, investment or non-controlling interest in a subsidiary, from its internal financial statements for purposes of its internal budgets. Non-GAAP financial measures are used by the Company's management in their financial and operating decision-making, because management believes they reflect the Company's ongoing business in a manner that allows more meaningful period-to-period comparisons. The Company's management believes that these non-GAAP financial measures provide useful information to investors and others in the following ways: 1) in comparing the Company's current financial results with the Company's past financial results in a consistent manner, and 2) in understanding and evaluating the Company's current operating performance and future prospects in the same manner as management does, if they so choose. The Company's management further believes the non-GAAP financial measures provide useful information to both management and investors by excluding certain expenses, gains/losses and other items (i) that are not expected to result in future cash payments or (ii) that are non-recurring in nature or may not be indicative of its core operating results and business outlook.
The Company's management believes excluding stock-based compensation from its non-GAAP financial measures is useful for itself and investors, as such expense will not result in future cash payments and is not an indicator used by management to measure the Company's core operating results and business outlook.
The Company's management believes excluding the amortization expense of intangible assets from its non-GAAP financial measures is useful for itself and investors, because it enables a more meaningful comparison of the Company's cash performance between reporting periods. In addition, such charges will not result in cash settlement in the future and is not an indicator used by management to measure the Company's core operating results and business outlook.
The Company's management believes excluding the recognition of deferred revenues, mostly relating to the license agreements resulting from
The Company's non-GAAP equity income from its interest in net income attributable to CRIC excludes stock-based compensation, amortization expense of intangible assets and gains from the purchase of a business, which are consistent with the Company's adjusted items to calculate non-GAAP measures.
The Company's management believes excluding gain/loss resulting from the disposal, purchase or impairment of a business, investment or non-controlling interest in a subsidiary from its non-GAAP financial measures is useful for itself and investors, because such gains/losses are not indicative of the Company's core operating results.
The non-GAAP financial measures have limitations. They do not include all items of income and expense that affect the Company's operations. Specifically, these non-GAAP financial measures are not prepared in accordance with GAAP, may not be comparable to non-GAAP financial measures used by other companies and, with respect to the non-GAAP financial measures that exclude certain items under GAAP, do not reflect any benefit that such items may confer to the Company. Management compensates for these limitations by also considering the Company's financial results as determined in accordance with GAAP.
Conference Call
US: |
+1 617 614 4076 |
|
UK: |
+44 207 365 8426 |
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Hong Kong: |
+852 3002 1672 |
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Passcode for all regions: |
19587139 |
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A replay of the conference call will be available through
About
Safe Harbor Statement
This press release contains forward-looking statements that relate to, among other things,
Contact:
IR Manager
Phone: 8610-82628888 x 3112
Email: ir@staff.sina.com.cn
SINA CORPORATION |
|||||||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
|||||||||||
(U.S. Dollars in thousands, except per share data) |
|||||||||||
Three months ended |
Twelve months ended |
||||||||||
December 31, |
September 30, |
December 31, 2011 |
|||||||||
2011 |
2010 |
2011 |
2011 |
2010 |
|||||||
Net revenues: |
|||||||||||
Advertising |
$ 103,655 |
$ 82,451 |
$ 101,018 |
$ 368,805 |
$ 290,814 |
||||||
Non-advertising |
29,714 |
27,503 |
29,268 |
114,024 |
111,803 |
||||||
133,369 |
109,954 |
130,286 |
482,829 |
402,617 |
|||||||
Cost of revenues: |
|||||||||||
Advertising (a) |
45,635 |
32,971 |
41,070 |
157,458 |
116,295 |
||||||
Non-advertising |
15,098 |
13,478 |
16,072 |
57,890 |
52,115 |
||||||
60,733 |
46,449 |
57,142 |
215,348 |
168,410 |
|||||||
Gross profit |
72,636 |
63,505 |
73,144 |
267,481 |
234,207 |
||||||
Operating expenses: |
|||||||||||
Sales and marketing (a) |
36,013 |
20,230 |
36,256 |
135,867 |
77,996 |
||||||
Product development (a) |
21,464 |
9,696 |
19,429 |
65,533 |
34,048 |
||||||
General and administrative (a) |
9,088 |
6,296 |
8,264 |
30,121 |
22,585 |
||||||
Goodwill impairment |
- |
- |
68,891 |
68,891 |
- |
||||||
Amortization of intangibles |
107 |
249 |
107 |
731 |
3,335 |
||||||
66,672 |
36,471 |
132,947 |
301,143 |
137,964 |
|||||||
Income (loss) from operations |
5,964 |
27,034 |
(59,803) |
(33,662) |
96,243 |
||||||
Non-operating income (loss): |
|||||||||||
Interest and other income, net |
3,539 |
2,255 |
5,826 |
16,327 |
8,804 |
||||||
Earnings from equity investments, net |
225 |
1,127 |
176 |
1,466 |
12,604 |
||||||
Impairment on equity investments |
- |
(128,554) |
(281,162) |
(281,548) |
(128,554) |
||||||
3,764 |
(125,172) |
(275,160) |
(263,755) |
(107,146) |
|||||||
Income (loss) before income taxes |
9,728 |
(98,138) |
(334,963) |
(297,417) |
(10,903) |
||||||
Provision for income taxes |
(713) |
(1,921) |
(1,366) |
(5,001) |
(8,436) |
||||||
Net income (loss) |
9,015 |
(100,059) |
(336,329) |
(302,418) |
(19,339) |
||||||
Less: Net income (loss) attributable to noncontrolling interest |
(264) |
(73) |
9 |
(326) |
(245) |
||||||
Net income (loss) attributable to SINA |
$ 9,279 |
$ (99,986) |
$ (336,338) |
$ (302,092) |
$ (19,094) |
||||||
Basic net income (loss) per share attributable to SINA |
$ 0.14 |
$ (1.62) |
$ (5.10) |
$ (4.64) |
$ (0.31) |
||||||
Diluted net income (loss) per share attributable to SINA |
$ 0.14 |
$ (1.62) |
$ (5.10) |
$ (4.64) |
$ (0.31) |
||||||
Shares used in computing basic |
|||||||||||
net income (loss) per share attributable to SINA |
66,021 |
61,626 |
65,908 |
65,121 |
61,216 |
||||||
Shares used in computing diluted |
|||||||||||
net income (loss) per share attributable to SINA |
66,767 |
61,626 |
65,908 |
65,121 |
61,216 |
||||||
(a) Stock-based compensation in each category: |
|||||||||||
Cost of revenues - advertising |
$ 1,065 |
$ 590 |
$ 895 |
$ 3,346 |
$ 2,989 |
||||||
Sales and marketing |
1,068 |
522 |
909 |
3,155 |
2,369 |
||||||
Product development |
1,132 |
383 |
982 |
3,082 |
1,812 |
||||||
General and administrative |
2,030 |
1,592 |
1,629 |
7,024 |
6,232 |
||||||
SINA CORPORATION |
|||||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS |
|||||||
(U.S. Dollars in thousands) |
|||||||
December 31, |
December 31, |
||||||
2011 |
2010 |
||||||
Assets |
|||||||
Current assets: |
|||||||
Cash and cash equivalents |
$ 513,980 |
$ 643,619 |
|||||
Short-term investments |
159,495 |
239,216 |
|||||
Accounts receivable, net |
112,469 |
89,843 |
|||||
Other current assets |
41,966 |
35,981 |
|||||
Total current assets |
827,910 |
1,008,659 |
|||||
Property and equipment, net |
74,511 |
33,289 |
|||||
Goodwill and intangible assets, net |
15,974 |
85,574 |
|||||
Investments |
463,938 |
508,113 |
|||||
Other assets |
9,114 |
455 |
|||||
Total assets |
$ 1,391,447 |
$ 1,636,090 |
|||||
Liabilities and Shareholders' Equity |
|||||||
Current liabilities: |
|||||||
Accounts payable |
$ 8,854 |
$ 3,963 |
|||||
Accrued liabilities |
174,972 |
128,050 |
|||||
Income taxes payable |
14,717 |
17,011 |
|||||
Convertible debt |
2,200 |
99,000 |
|||||
Total current liabilities |
200,743 |
248,024 |
|||||
Long-term deferred revenue |
126,529 |
145,274 |
|||||
Other long-term liabilities |
1,826 |
2,266 |
|||||
Total liabilities |
329,098 |
395,564 |
|||||
Shareholders' equity |
|||||||
SINA shareholders' equity |
1,055,670 |
1,239,308 |
|||||
Noncontrolling interest |
6,679 |
1,218 |
|||||
Total shareholders' equity |
1,062,349 |
1,240,526 |
|||||
Total liabilities and shareholders' equity |
$ 1,391,447 |
$ 1,636,090 |
|||||
SINA CORPORATION |
|||||||||||
UNAUDITED SEGMENT INFORMATION |
|||||||||||
(U.S. Dollars in thousands) |
|||||||||||
Three months ended |
Twelve months ended |
||||||||||
December 31, |
September 30, |
December 31, |
|||||||||
2011 |
2010 |
2011 |
2011 |
2010 |
|||||||
Net revenues |
|||||||||||
Advertising |
$ 103,655 |
$ 82,451 |
$ 101,018 |
$ 368,805 |
$ 290,814 |
||||||
Mobile related |
21,281 |
21,007 |
21,374 |
83,457 |
86,183 |
||||||
Others |
8,433 |
6,496 |
7,894 |
30,567 |
25,620 |
||||||
$ 133,369 |
$ 109,954 |
$ 130,286 |
$ 482,829 |
$ 402,617 |
|||||||
Cost of revenues |
|||||||||||
Advertising |
$ 45,635 |
$ 32,971 |
$ 41,070 |
$ 157,458 |
$ 116,295 |
||||||
Mobile related |
13,783 |
12,787 |
14,584 |
53,235 |
49,612 |
||||||
Others |
1,315 |
691 |
1,488 |
4,655 |
2,503 |
||||||
$ 60,733 |
$ 46,449 |
$ 57,142 |
$ 215,348 |
$ 168,410 |
|||||||
SINA CORPORATION |
|||||||||||||||||||
UNAUDITED RECONCILIATION OF NON-GAAP TO GAAP RESULTS |
|||||||||||||||||||
(U.S. Dollars in thousands, except per share data) |
|||||||||||||||||||
Three months ended |
|||||||||||||||||||
December 31, 2011 |
December 31, 2010 |
September 30, 2011 |
|||||||||||||||||
Non-GAAP |
Non-GAAP |
Non-GAAP |
|||||||||||||||||
Actual |
Adjustments |
Results |
Actual |
Adjustments |
Results |
Actual |
Adjustments |
Results |
|||||||||||
Advertising revenues |
$ 103,655 |
$ 103,655 |
$ 82,451 |
$ 82,451 |
$ 101,018 |
$ 101,018 |
|||||||||||||
Non-advertising revenues |
29,714 |
(4,686) |
(c) |
25,028 |
27,503 |
(4,916) |
(c) |
22,587 |
29,268 |
(4,687) |
(c) |
24,581 |
|||||||
Net revenues |
$ 133,369 |
$ (4,686) |
$ 128,683 |
$ 109,954 |
$ (4,916) |
$ 105,038 |
$ 130,286 |
$ (4,687) |
$ 125,599 |
||||||||||
1,065 |
(a) |
590 |
(a) |
895 |
(a) |
||||||||||||||
(4,686) |
(c) |
(4,916) |
(c) |
(4,687) |
(c) |
||||||||||||||
Gross profit |
$ 72,636 |
$ (3,621) |
$ 69,015 |
$ 63,505 |
$ (4,326) |
$ 59,179 |
$ 73,144 |
$ (3,792) |
$ 69,352 |
||||||||||
(3,520) |
(a) |
||||||||||||||||||
(4,230) |
(a) |
(2,497) |
(a) |
(107) |
(b) |
||||||||||||||
(107) |
(b) |
(249) |
(b) |
(68,891) |
(e) |
||||||||||||||
Operating expenses |
$ 66,672 |
$ (4,337) |
$ 62,335 |
$ 36,471 |
$ (2,746) |
$ 33,725 |
$ 132,947 |
$ (72,518) |
$ 60,429 |
||||||||||
4,415 |
(a) |
||||||||||||||||||
5,295 |
(a) |
3,087 |
(a) |
107 |
(b) |
||||||||||||||
107 |
(b) |
249 |
(b) |
(4,687) |
(c) |
||||||||||||||
(4,686) |
(c) |
(4,916) |
(c) |
68,891 |
(e) |
||||||||||||||
Income (loss) from operations |
$ 5,964 |
$ 716 |
$ 6,680 |
$ 27,034 |
$ (1,580) |
$ 25,454 |
$ (59,803) |
$ 68,726 |
$ 8,923 |
||||||||||
4,415 |
(a) |
||||||||||||||||||
3,087 |
(a) |
107 |
(b) |
||||||||||||||||
5,295 |
(a) |
249 |
(b) |
(4,687) |
(c) |
||||||||||||||
107 |
(b) |
(4,916) |
(c) |
3,909 |
(d) |
||||||||||||||
(4,686) |
(c) |
3,614 |
(d) |
68,891 |
(e) |
||||||||||||||
3,958 |
(d) |
128,554 |
(f) |
281,162 |
(f) |
||||||||||||||
Net income (loss) attributable to SINA |
$ 9,279 |
$ 4,674 |
$ 13,953 |
$ (99,986) |
$ 130,588 |
$ 30,602 |
$ (336,338) |
$ 353,797 |
$ 17,459 |
||||||||||
Diluted net income (loss) per share attributable to SINA |
$ 0.14 |
$ 0.21 |
$ (1.62) |
$ 0.46 |
$ (5.10) |
$ 0.26 |
|||||||||||||
Shares used in computing diluted |
|||||||||||||||||||
net income (loss) per share attributable to SINA |
66,767 |
- |
(g) |
66,767 |
61,626 |
4,763 |
(g) |
66,389 |
65,908 |
1,005 |
(g) |
66,913 |
|||||||
Gross margin - advertising |
56% |
1% |
57% |
60% |
1% |
61% |
59% |
1% |
60% |
||||||||||
Twelve months ended |
|||||||||||||
December 31, 2011 |
December 31, 2010 |
||||||||||||
Non-GAAP |
Non-GAAP |
||||||||||||
Actual |
Adjustments |
Results |
Actual |
Adjustments |
Results |
||||||||
Advertising revenues |
$ 368,805 |
$ 368,805 |
$ 290,814 |
$ 290,814 |
|||||||||
Non-advertising revenues |
114,024 |
(18,745) |
(c) |
95,279 |
111,803 |
(18,975) |
(c) |
92,828 |
|||||
Net revenues |
$ 482,829 |
$ (18,745) |
$ 464,084 |
$ 402,617 |
$ (18,975) |
$ 383,642 |
|||||||
3,346 |
(a) |
2,989 |
(a) |
||||||||||
(18,745) |
(c) |
(18,975) |
(c) |
||||||||||
Gross profit |
$ 267,481 |
$ (15,399) |
$ 252,082 |
$ 234,207 |
$ (15,986) |
$ 218,221 |
|||||||
(13,261) |
(a) |
||||||||||||
(731) |
(b) |
(10,413) |
(a) |
||||||||||
(68,891) |
(e) |
(3,335) |
(b) |
||||||||||
Operating expenses |
$ 301,143 |
$ (82,883) |
$ 218,260 |
$ 137,964 |
$ (13,748) |
$ 124,216 |
|||||||
16,607 |
(a) |
||||||||||||
731 |
(b) |
13,402 |
(a) |
||||||||||
(18,745) |
(c) |
3,335 |
(b) |
||||||||||
68,891 |
(e) |
(18,975) |
(c) |
||||||||||
Income (loss) from operations |
$ (33,662) |
$ 67,484 |
$ 33,822 |
$ 96,243 |
$ (2,238) |
$ 94,005 |
|||||||
16,607 |
(a) |
||||||||||||
731 |
(b) |
13,402 |
(a) |
||||||||||
(18,745) |
(c) |
3,335 |
(b) |
||||||||||
14,703 |
(d) |
(18,975) |
(c) |
||||||||||
68,891 |
(e) |
6,647 |
(d) |
||||||||||
281,548 |
(f) |
128,554 |
(f) |
||||||||||
Net income (loss) attributable to SINA |
$ (302,092) |
363,735 |
$ 61,643 |
$ (19,094) |
$ 132,963 |
$ 113,869 |
|||||||
Diluted net income (loss) per share attributable to SINA |
$ (4.64) |
$ 0.92 |
$ (0.31) |
$ 1.73 |
|||||||||
Shares used in computing diluted |
|||||||||||||
net income (loss) per share attributable to SINA |
65,121 |
1,943 |
(g) |
67,064 |
61,216 |
4,692 |
(g) |
65,908 |
|||||
Gross margin - advertising |
57% |
1% |
58% |
60% |
1% |
61% |
|||||||
(a) To adjust stock-based compensation related to employee incentives. |
|||||||||||||
(b) To adjust amortization of intangible assets. |
|||||||||||||
(c) To adjust the recognition of deferred revenue mostly related to the license agreements resulting from the CRIC Transaction. |
|||||||||||||
(d) To adjust share of CRIC's GAAP to Non-GAAP reconciling items, net of share of amortization of CRIC's intangibles not on CRIC's books. |
|||||||||||||
(e) To adjust for impairment of MVAS goodwill |
|||||||||||||
(f) To adjust impairment of equity investments |
|||||||||||||
(g) To adjust the number of shares used in computing diluted net loss per share to diluted net income per share. |
|||||||||||||
UNAUDITED RECONCILIATION OF SINA'S SHARE OF CRIC'S NON-GAAP TO GAAP RESULTS* |
|||||||||||||||||||
Three months ended |
|||||||||||||||||||
December 31, 2011 |
December 31, 2010 |
September 30, 2011 |
|||||||||||||||||
Actual |
Adjustments |
Non-GAAP Results |
Actual |
Adjustments |
Non-GAAP Results |
Actual |
Adjustments |
Non-GAAP Results |
|||||||||||
To adjust stock-based compensation |
$ 1,617 |
$ 1,327 |
$ 1,605 |
||||||||||||||||
To adjust amortization expenses of intangible |
|||||||||||||||||||
assets resulting from business acquisitions |
1,605 |
1,503 |
1,568 |
||||||||||||||||
Equity income (loss) from CRIC |
$ 1,642 |
$ 3,222 |
$ 4,864 |
$ 2,222 |
$ 2,830 |
$ 5,052 |
$ 1,074 |
$ 3,173 |
$ 4,247 |
||||||||||
Share of amortization of CRIC's intangibles not |
|||||||||||||||||||
on CRIC's books |
$ (736) |
$ 736 |
$ - |
$ (784) |
$ 784 |
$ - |
$ (736) |
$ 736 |
$ - |
||||||||||
$ 906 |
$ 3,958 |
$ 4,864 |
$ 1,438 |
$ 3,614 |
$ 5,052 |
$ 338 |
$ 3,909 |
$ 4,247 |
|||||||||||
Twelve months ended |
|||||||||||||
December 31, 2011 |
December 31, 2010 |
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Actual |
Adjustments |
Non-GAAP Results |
Actual |
Adjustments |
Non-GAAP Results |
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To adjust stock-based compensation |
$ 5,531 |
$ 5,239 |
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To adjust amortization expenses of intangible |
|||||||||||||
assets resulting from business acquisitions |
6,216 |
6,161 |
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To adjust gains from the purchase of a business: |
|||||||||||||
Income from investment in affiliates** |
- |
(7,155) |
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Gain from settlement of pre-existing |
|||||||||||||
relationship with COHT |
- |
(701) |
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Equity income from CRIC |
$ 5,597 |
$ 11,747 |
$ 17,344 |
$ 16,169 |
$ 3,544 |
$ 19,713 |
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Share of amortization of CRIC's intangibles not |
|||||||||||||
on CRIC's books |
$ (2,956) |
$ 2,956 |
$ - |
$ (3,103) |
$ 3,103 |
$ - |
|||||||
$ 2,641 |
$ 14,703 |
$ 17,344 |
$ 13,066 |
$ 6,647 |
$ 19,713 |
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* Income (loss) from CRIC is recorded one quarter in arrears. |
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** Represents the excess of fair value over the carrying amount recognized as a result of acquisition of COHT. |
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SOURCE