AsiaInfo's Operating Profit Doubles Sequentially to US$3.5 Million; Company raises 2001 Earnings Guidance.Business Editors BEIJING Beijing (bā-jĭng) or Peking (pē-kĭng, pā–), city (1994 est. urban pop. 6,093,300; 1994 est. total pop. 7,240,700), capital of the People's Republic of China. It is in central Hebei prov. & SANTA CLARA Santa Clara, city, Cuba Santa Clara (sän`tä klä`rä), city (1994 est. pop. 217,000), capital of Villa Clara prov., central Cuba. , Calif.--(BUSINESS WIRE)--Oct. 23, 2001 AsiaInfo Holdings, Inc. (Nasdaq:ASIA Asia (ā`zhə), the world's largest continent, 17,139,000 sq mi (44,390,000 sq km), with about 3.3 billion people, nearly three fifths of the world's total population. ), a leading provider of telecom network integration and software solutions in China, today announced its third quarter results for the period ended September September: see month. 30, 2001. AsiaInfo's third quarter net revenue (revenue net of hardware costs) grew to US$20.1 million, representing a 51.5 percent increase over net revenue of US$13.3 million in the comparable quarter of 2000, and a 18.3 percent increase over last quarter's net revenue. Gross profit was US$15.5 million, a 58.7 percent increase over the same period last year, representing a gross margin (as a percentage of net revenue) of 77.1 percent. Third quarter gross revenue was US$94.0 million. As of the end of the third quarter, net revenue backlog Backlog The total value of sales orders waiting to be fulfilled. Notes: This figure is used mainly in the manufacturing industry. Increases or decreases in a company's backlog indicate the future direction of sales and earnings. was US$46.8 million, representing a 37.2 percent year-over-year growth rate, providing clear revenue visibility into the next two quarters. AsiaInfo's third quarter operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. grew to US$3.5 million, a 99 percent sequential One after the other in some consecutive order such as by name or number. increase over the previous quarter's operating profit of US$1.76 million and a significant improvement over third quarter 2000 operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. of US$1.6 million. AsiaInfo's operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: (as a percentage of net revenue) grew from 10.3 percent in the second quarter of 2001 to 17.4 percent in the third quarter of 2001, representing a significant increase in profitability. Third quarter net income increased to US$3.5 million, or US$0.08 per basic share, representing a 748 percent improvement over net income of US$0.4 million in the third quarter of 2000. As announced last quarter, AsiaInfo now discloses total software revenue, a combination of software license revenue and software service revenue, to more accurately reflect the revenues generated by its two strategic business units. As such, third quarter 2001 software revenue was US$7.7 million, representing a 46.9 percent increase over the US$5.2 million in the same quarter of 2000. Total software revenue represented 38.3 percent of total net revenue in the third quarter of 2001. Third quarter software license revenue was US$6.5 million, representing a 32.6 percent increase over US$4.9 million in the same quarter of 2000. Third quarter operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. increased only 5.5 percent over third quarter operating expenses of 2000, demonstrating the company's increased operating efficiency, directly contributing to this quarter's significant growth in profitability. James James, person in the Bible James, in the Gospel of St. Luke, kinsman of St. Jude. The original does not specify the relationship. James, rivers, United States James. Ding, chief executive officer and president of AsiaInfo commented, "We continue to execute on our business strategy as planned, having significantly raised our operating profitability as we increasingly shift our focus towards high-end high-end adj. Informal 1. Appealing to sophisticated and discerning customers: a high-end department store; high-end video equipment. 2. software and services. Furthermore, we do not expect to be affected by the current worldwide business environment, as the China market continues its steady growth." Third Quarter Market Highlights The development of China's telecom sector is being driven by two primary factors: 1- The growing demand for data and voice telecom services in China 2- The need for high-end solutions to manage the rapidly developing network infrastructure China's telecom market is growing rapidly as user growth in both voice and data services remains strong. With current low penetration rates of 1.7 percent for data services, 12.6 percent for fixed-line Refers to wired devices. For example, a fixed-line phone is a standard phone with the handset wired to the base unit in contrast to a portable phone or cellphone. services and 9 percent for wireless services, tremendous potential for further growth exists. In order to serve this growing demand and offer next-generation telecom services, China's carriers are rapidly expanding their national and provincial Provincial has several meanings and may refer to:
Secondly, in this increasingly competitive market, telecom carriers are turning to high-end solutions such as broadband broadband Term describing the radiation from a source that produces a broad, continuous spectrum of frequencies (contrasted with a laser, which produces a single frequency or very narrow range of frequencies). , mobile data and Voice over IP services to improve profitability and differentiate differentiate /dif·fer·en·ti·ate/ (dif?er-en´she-at) 1. to distinguish, on the basis of differences. 2. to develop specialized form, character, or function differing from that surrounding it or from the original. themselves. Carriers are also investing in high quality operation support systems (OSS Oss (ôs), city (1994 pop. 62,141), North Brabant prov., S Netherlands; chartered 1399. It is a significant industrial center. Manufactures include meat products, chemicals, pharmaceuticals, electrical equipment, and metalware. ), including billing, customer care, order management and provisioning systems to improve their competitive position. As AsiaInfo meets these needs with its high-end products and solutions, including its operating support systems, billing software and Metro Area This article is about the music production team. For the article about population centers, see metropolitan area. Metro Area are a Brooklyn-based dance music production team composed of Morgan Geist and Darshan Jesrani. Network broadband management services, the company is strengthening its dominant position in these markets. Contract Wins As evidence of the increasing demand for value added Value Added The enhancement a company gives its product or service before offering the product to customers. Notes: This can either increase the products price or value. services and expansion of provincial network capacity, AsiaInfo signed a number of new contracts during the third quarter. Highlights of these contracts include: -- Two contracts to support China Telecom by building broadband networks in Heilongjiang and Shandong provinces valued at more than US$2 million -- A US$4 million contract with China Telecom provincial subsidiary, Yunnan Telecom, to expand its provincial network capacity -- A first of its kind contract to build a billing system for China Unicom's CDMA network, through which AsiaInfo has secured the largest market share among all vendors -- Two contracts with China Netcom (CNC) to provide software products and network services to expand and enhance its data network infrastructure -- A contract to support Sichuan Telecom, a provincial subsidiary of China Telecom, by expanding its provincial network capacity and building its broadband network -- Contracts worth US$5.2 million in total to provide integration services and AsiaInfo's flagship software products for China Mobile provincial data networks in Guizhou, Ningxia, Shaanxi and Sichuan provinces -- A contract to support Zhejiang Telecom, a provincial subsidiary of China Telecom, in constructing its broadband access network Ding commented, "During the third quarter, China surpassed the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. to become the world's largest mobile market with 120 million subscribers. AsiaInfo is helping to expand China's exploding wireless market through continued wireless network expansion, existing and new software products and high-end services for the wireless market. The recent selection by China Unicom China Unicom, full name China United Telecommunications Corporation, 中国联通, HKSE: 0762 NYSE: CHU, is a telecommunication operator in the People's Republic of China. 52. to support more than 30% of its new CDMA (Code Division Multiple Access) A method for transmitting simultaneous signals over a shared portion of the spectrum. The foremost application of CDMA is the digital cellular phone technology from QUALCOMM that operates in the 800 MHz band and 1.9 GHz PCS band. network further solidifies AsiaInfo's leadership position in the wireless market." Ding summarized the company's outlook, "China is now the single fastest growing economy in the world, and the telecom sector is poised to be a key benefactor ben·e·fac·tor n. One that gives aid, especially financial aid. [Middle English, from Late Latin, from Latin benefacere, to do a service; see benefaction. of this growth. With our leading market share, top-notch technology, local expertise and strong customer relationships, we are confident that AsiaInfo will continue its strong growth." Business Outlook The following outlook statements are based on current expectations. These statements are forward looking and actual results may differ materially. Fourth Quarter and Full-Year 2001 Guidance The company is raising its full-year 2001 EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. guidance from US $0.20-0.24 to US$ 0.26 - 0.27 per basic share, exceeding the previously disclosed dis·close tr.v. dis·closed, dis·clos·ing, dis·clos·es 1. To expose to view, as by removing a cover; uncover. 2. To make known (something heretofore kept secret). full-year guidance. As such, the net income for FY 2001 will reach US$ 11.3 - 11.5 million. Fourth quarter 2001 net income is expected to be US$ 3.8 - 4.0 million, translating into earnings per basic share of US$ 0.08 - 0.09. Fourth quarter operating profit is expected to be approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. US$4.0 - 4.5 million, representing a sequential growth rate of 14 - 28 percent. The company expects 2001 fourth quarter net revenue to be in the range of US$19-20 million, representing a year-over-year growth rate of 35 - 42 percent. As such, the net revenue for FY 2001 is expected to be US$ 70.4 - 71.4 million, representing a 58 - 60 percent year-over-year growth rate, and meeting the previously disclosed full-year net revenue guidance. Q4 2001 total software revenue will increase at a year-over-year growth rate of approximately 5 - 14 percent to reach US$6.0 - 6.5 million. As such, the software revenue for FY 2001 is expected to be US$ 27.4 - 28 million, representing a 57 - 60 percent year-over-year growth rate. Research and Development and General and Administration expenses will remain at the same level as in the third quarter. Sales and Marketing expenses will be lower than those in the third quarter. Third Quarter Conference Call AsiaInfo will host a conference call to discuss its second quarter results at 8:00pm EDT/5:00pm PDT PDT abbr. Pacific Daylight Time PDT Pacific Daylight Time PDT n abbr (US) (= Pacific Daylight Time) → hora de verano del Pacífico PDT on October October: see month. 23 (Beijing Time: October 24th, 2001 at 8:00am). The dial-in number for the call is 973-872-3100. A replay will be available by dialing 877-519-4471 for US callers or 973-341-3080 for international callers with a PIN of 2852903 between 5:00pm PDT on October 23, 2001 until 5:00pm PDT on November November: see month. 23, 2001. Additionally, the conference call will be broadcast via the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the and can be accessed via the investor relations Investor relations The process by which the corporation communicates with its investors. section of AsiaInfo's corporate Web site at www.asiainfo.com.
ASIAINFO HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in thousands of US$)
Three Months Ended Sep 30
2001 2000
Revenues:
Network solutions 86,323 52,820
Software 7,708 5,248
Software license 6,507 4,909
Software service 1,201 339
Total revenues 94,031 58,068
Cost of revenues:
Network solutions 77,649 47,152
Software 842 1,126
Software license 2 26
Software service 840 1,100
Total cost of revenues 78,491 48,278
Gross Profit 15,540 9,790
Operating expenses:
Sales and marketing 6,323 5,702
General and administrative 3,550 3,500
Research and development 1,945 1,743
Amortization of
deferred stock
compensation 216 467
Total operating expenses 12,034 11,412
(Loss) income from operations 3,506 -1,622
Other income (expenses):
Interest income 1,644 2,283
Interest expense -216 -285
Other income, net -5 14
Total other income, net 1,423 2,012
Income before income
taxes, minority interests
and equity in loss of
affiliated 4,929 390
Income tax expense 985 -6
Minority interests -105 19
Equity in loss of affiliate -320 0
Net (loss) income 3,519 415
Net (loss) income per share
Basic 0.08 0.01
Diluted 0.08 0.01
Shares used in computation
Basic 41,757,250 39,841,935
Diluted 45,159,256 45,456,176
Segment information
Network solutions
net of hardware cost 12,437 8,051
Software 7,708 5,248
Software license 6,507 4,909
Software service 1,201 339
Consolidated revenues net of
hardware cost 20,145 13,299
Consolidated cost of sales net of
hardware cost 4,605 3,509
Consolidated gross profit 15,540 9,790
Nine Months Ended Sep 30,
2001 2000
Revenues:
Network solutions 130,005 120,365
Software 21,357 11,687
Software license 18,685 11,145
Software service 2,672 542
Total revenues 151,362 132,052
Cost of revenues:
Network solutions 108,629 109,736
Software 2,564 1,859
Software license 3 29
Software service 2,561 1,830
Total cost of revenues 111,193 111,595
Gross Profit 40,169 20,457
Operating expenses:
Sales and marketing 17,770 13,291
General and administrative 10,696 9,274
Research and development 5,522 4,433
Amortization of
deferred stock compensation 937 1,752
Total operating expenses 34,925 28,750
(Loss) income from operations 5,244 -8,293
Other income (expenses):
Interest income 6,225 5,504
Interest expense -883 -894
Other income, net -39 -193
Total other income, net 5,303 4,417
Income before income
taxes, minority interests
and equity in loss of
affiliated 10,547 -3,876
Income tax expense 2,262 -68
Minority interests -235 19
Equity in loss of affiliate -576 0
Net (loss) income 7,474 -3,789
Net (loss) income per share
Basic 0.18 -0.10
Diluted 0.16 -0.10
Shares used in computation
Basic 41,343,389 36,133,972
Diluted 45,689,785 36,133,972
Segment information
Network solutions
net of hardware cost 30,021 18,820
Software 21,357 11,687
Software license 18,685 11,145
Software service 2,672 542
Consolidated revenues net of
hardware cost 51,378 30,507
Consolidated cost of sales net of
hardware cost 11,209 10,050
Consolidated gross profit 40,169 20,457
AsiaInfo Holdings, Inc.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In US$)
Sep 30, 2001 Dec 31, 2000
ASSETS
Current Assets:
Cash and cash equivalents 104,597,540 48,833,956
Restricted cash 25,764,358 26,733,179
Short term investments 22,409,927 110,400,000
Accounts receivable, trade
(net of allowance for doubtful
accounts of $545,013 and $1,187,700
at Dec 31, 2000 and
September 30, 2001 respectively) 80,959,943 55,597,496
Inventories 1,249,605 8,876,010
Other current assets 5,317,627 3,749,255
Total current assets 240,299,000 254,189,896
Property, plant, and
equipment-net 5,817,404 6,339,751
Long Term investment 5,581,265
Other assets 2,710,707 3,473,417
Total assets 254,408,376 264,003,064
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Short-term bank loans 16,733,318 20,644,834
Accounts payable 29,836,256 42,037,151
Accrued employee benefit 9,193,624 10,019,624
Deferred Revenue 3,585,483 12,501,524
Income Taxes payable 2,025,071 307,373
Other Taxes payable 1,624,845 1,909,450
Other current liabilities 11,310,423 7,785,694
Total current liabilities 74,309,020 95,205,650
Minority interest 448,860 188,044
Stockholders' Equity:
Common stock, 50,000,000 shares
authorized; $0.01 par value,
shares issued and outstanding :
December 31, 2000 40,822,940;
September 30 ,2001 41,950,891 419,509 408,229
Additional paid-in capital 177,979,907 175,370,544
Deferred stock compensation (719,055) (1,655,821)
Retained earnings (accumulated deficit) 1,943,075 (5,530,601)
Accumulated other comprehensive
income (loss) 27,060 17,019
Total stockholders' equity 179,650,496 168,609,370
Total Liabilities and
Stockholders' Equity 254,408,376 264,003,064
About AsiaInfo Holdings, Inc. AsiaInfo Holdings, Inc. (Nasdaq:ASIA) is a leading provider of software products and infrastructure solutions for next generation network operators in China. The company offers telecommunications service providers A Telecommunications Service Provider or TSP is a type of Communications Service Provider that has traditionally provided telephone and similar services. This category includes ILECs, CLECs, and mobile wireless companies. total network solutions for their Internet infrastructure requirements and develops proprietary software for Internet service providers Internet service provider (ISP) Company that provides Internet connections and services to individuals and organizations. For a monthly fee, ISPs provide computer users with a connection to their site (see data transmission), as well as a log-in name and password. , Internet content providers See content provider. and telecommunications service providers. The company's customer management and billing software products meet the complex, mission-critical provisioning, accounting, reporting and marketing needs of Internet and telecommunications service providers. The company also offers carrier-scale messaging products to Internet service providers and Internet content providers. Since it moved its operations from the US to China in 1995, AsiaInfo has served as a chief architect of the country's Internet infrastructure, crafting the Internet backbones A group of communications networks managed by several commercial companies that provide the major high-speed links across the country. ISPs are either connected directly to these backbones or to a larger regional ISP that is connected to one. for all the major national carriers including China Telecom, China Unicom, China Netcom China Netcom, full name China Netcom Group Corporation (Hong Kong) Limited, abbreviated CNC, was originally formed in August 1999 by the People's Republic of China government to enable inward investments to build high speed Internet communications in the country. and China Mobile. For more information about AsiaInfo, please visit www.asiainfo.com The statements in this news release contain forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. that involve risks and uncertainties that could cause actual results to differ from anticipated results. Further information on risk factors that could affect AsiaInfo's results of operation are detailed in AsiaInfo's registration statement, as filed with the Securities and Exchange Commission. A copy of the registration statement, including exhibits, may be reviewed at the Commission's public reference room at Judiciary judiciary Branch of government in which judicial power is vested. The principal work of any judiciary is the adjudication of disputes or controversies. Regulations govern what parties are allowed before a judicial assembly, or court, what evidence will be admitted, what Plaza For the hotel in New York City, see . Plaza (IPA /'plaθa/ or /'plasa/ , 450 Fifth Street, N.W., Washington Washington, town, England Washington, town (1991 pop. 48,856), Sunderland metropolitan district, NE England. Washington was designated one of the new towns in 1964 to alleviate overpopulation in the Tyneside-Wearside area. , D.C. 20549. The registration statement and other company filings can also be reviewed by accessing the Commission's Internet site at http://www.sec.gov See .gov and GovNet. (networking) gov - The top-level domain for US government bodies. , which contains reports, proxy See proxy server. (networking) proxy - A process that accepts requests for some service and passes them on to the real server. A proxy may run on dedicated hardware or may be purely software. and information statements and other information regarding registrants that file electronically with the Commission. |
|
||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion