AsiaInfo Reports Fourth Quarter and 2001 Year-End Results; Operating Profit Increases More Than 200% Over 2000.Business Editors/High-Tech Writers 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)--Jan. 22, 2002 High Profitability in 2002: 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. Expected to Grow More Than 70%; Operating Margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: to Increase From 15% in 2001 to 20-24% in 2002 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 record fourth quarter and year-end year-end also year·end n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. results for the period ended December December: see month. 31, 2001. In a separate press release today, the company also announced the planned acquisition of Bonson Information Technology Limited, a leading provider of telecom operation support system (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. ) solutions in China. Fourth Quarter Financial Results AsiaInfo continued to demonstrate strong growth in the fourth quarter of fiscal year 2001, reporting record results in operating profit and net income. For the quarter, the company had net revenue (total revenue net of hardware costs) of US$20.0 million, representing a 42.2 percent increase over the same period of 2001. Gross revenue for the fourth quarter of 2001 was US$37.6 million. Gross profit was US$15.3 million, representing a 40.3 percent increase over the same period a year ago. AsiaInfo's fourth quarter operating profit grew to US$5.1 million, a 45.7 percent sequential increase and a 543.4 percent year-over-year increase. Operating margin increased to 25 percent from 17 percent last quarter. On a per-basic-share basis, operating profit was $0.12. Net income was US$4.3 million, or $0.10 per basic share, for the fourth quarter of 2001, representing an increase of 316 percent over net income of US$1.0 million, or $0.025 per basic share, for the fourth quarter of 2000. 2001 Fiscal Year Financial Results For the full fiscal year 2001, net revenue was US$71.4 million, a 60.2 percent increase over net revenue in 2000. Full year 2001 net income was US$11.7 million, or $0.28 per basic share, a significant increase over the 2000 net loss of US$2.8 million, or ($0.07) per basic share. Software revenue was US$27.9 million in 2001, representing 39 percent of total net revenue and a 60.5 percent increase over year 2000. Full year 2001 gross revenue was US$189.0 million and gross profit was US$55.5 million. 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, President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of AsiaInfo commented, "We are very happy to announce another great quarter. Despite the tough global business environment in 2001, we delivered solid financial results in 2001. Our full year operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. increased 210 percent over 2000, demonstrating the company's enhanced profitability, proven business model and improving business strategy and execution." Fourth Quarter Highlights New Contract Wins During the fourth quarter, AsiaInfo announced a number of contracts for software and solutions offerings, firmly establishing AsiaInfo as a complete software solution provider to telecom carriers in China. AsiaInfo announced the following new business developments in the fourth quarter: -- A contract with China Mobile subsidiary, Shanxi Mobile, to provide AsiaInfo's recently launched network optimization software -- Contracts with China Unicom and China Mobile, representing a combined value of US$6 million, to build provincial data networks and provide AsiaInfo's billing software -- A contract with China Mobile subsidiary, Sichuan Mobile, to provide Customer Relationship Management (CRM) software -- A contract with China Mobile subsidiary, Shanghai Mobile, to provide AsiaInfo's recently launched Business Operation Support Software (BOSS), the first major contract win for this new suite of software -- A contract to provide China Unicom's VoIP network with AsiaInfo's customer care and billing software in the third phase of expansion of the network -- A contract with Hong Kong's second largest Internet Service Provider, HK Net, to provide AsiaInfo's IP billing software -- A contract with China Telecom subsidiary, Zhejiang Telecom, to construct its broadband network. New Software Products In order to meet the increasingly advanced needs of China's telecom carriers, AsiaInfo launched two new software products during the fourth quarter of 2001: AIVelosurf and AIOmniVision. AsiaInfo's AIVelosurf is a newly developed network optimization software Free and Open Source software
In the context of general equities, keeping an activity within the firm. For example, rather than go to the marketplace and sell a security for a client to anyone, an attempt is made to find a buyer to complete the transaction with the firm. using proprietary technology, AIVelosurf is designed to address bandwidth bandwidth Measurement of the capacity of a communications signal. For digital signals, the bandwidth is the data speed or rate, measured in bits per second (bps). For analog signals, it is the difference between the highest and lowest frequency components, measured in hertz bottlenecks at the "last mile" of a 2.5G network. AsiaInfo's AIOmniVision is a new decision support software (DSS (1) (Digital Signature Standard) A National Security Administration standard for authenticating an electronic message. See RSA and digital signature. (2) (Digital Satellite S ) that gives telecom carriers the ability to understand and maximize business value from their existing customers; identify and focus on profitable customer groups; explore and attract potential customers; and improve service quality and ensure customer satisfaction and retention. Company Recognition Leading financial magazine AsiaMoney named AsiaInfo one of China's Best Managed Companies and recognized its investor relations Investor relations The process by which the corporation communicates with its investors. program as one of the best in China. "We place great importance on open communication with all our shareholders and the financial community, and we're we're Contraction of we are. we're we are proud to have been recognized for our effective corporate governance Corporate Governance The relationship between all the stakeholders in a company. This includes the shareholders, directors, and management of a company, as defined by the corporate charter, bylaws, formal policy, and rule of law. and investor relations efforts," said Ying Han Han, Chinese dynasty Han (hän), dynasty of China that ruled from 202 B.C. to A.D. 220. Liu Pang, the first Han emperor, had been a farmer, minor village official, and guerrilla fighter under the Ch'in dynasty. , chief financial officer of AsiaInfo, recipient of "2001 Best Practice Award for Raising Capital and Special Commendation COMMENDATION. The act of recommending, praising. A merchant who merely commends goods he offers for sale, does not by that act warrant them, unless there is some fraud: simplex commendatio non obligat. for Managing Finance at an SME (1) (Small and Medium-sized Enterprise) See SMB. (2) (Subject Matter Expert) An individual who is well-versed in the policies and procedures of a particular department or division. " from CFO See Chief Financial Officer. Asia, another leading financial magazine in the Asia Pacific region. Ding concluded, "Our strong fourth quarter and new contract wins in many new areas demonstrate AsiaInfo's leading market position and execution on strategy in the overall telecom market, a significant expansion from 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 infrastructure market where AsiaInfo started initially." Ding said, "As China's telecom market becomes increasingly competitive, carriers are actively enhancing their services, improving customer satisfaction, increasing efficiency and profitability, and eventually becoming multi-service providers. In order to accomplish these objectives, carriers will need to deploy a wide spectrum of advanced software and solutions to rapidly upgrade the existing infrastructure. With a full suite of telecom software solutions and an extensive customer installation base, AsiaInfo is best positioned to help China's telecom carriers succeed." Business Outlook The following outlook statements are based on current expectations. These statements are forward looking, and actual results may differ materially. Fiscal Year 2002 Pro Forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma Guidance (Including Bonson) AsiaInfo expects pro forma net revenue to increase by approximately 15 to 25 percent in fiscal year 2002 over 2001. Software solution revenue, including license and software service revenue, will represent 40 to 45 percent of total net revenue. The total 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$52 million as of December 31, 2001, accounting for 52 to 56 percent of the forecasted pro forma net revenue and providing significant visibility into the company's financial performance in 2002. Bonson's contribution to total net revenue is expected to be 12 to 14 percent. Sales and marketing expenses, general and administration expenses and research and development expenses are expected to account for 23 to 25 percent, 10 to 12 percent and 12 to 14 percent of forecasted pro forma net revenue, respectively. Pro forma operating profit for fiscal year 2002 is expected to increase at approximately 70 to 80 percent year-over-year. Operating margin (operating profit as a percentage of net revenue) will increase from 15 percent in 2001 to 20 to 24 percent in 2002, representing a significant increase in profitability, as the company will generate more revenue from high-margin software solutions. Pro forma net income for fiscal year 2002 is expected to be in the range of US$18 to 19 million, or $0.41 to 0.43 per basic share. Fiscal Year 2002 Guidance, excluding Bonson Contribution Excluding the Bonson acquisition, AsiaInfo expects fiscal year 2002 net revenue to increase by approximately 15 to 25 percent over 2001. At the end of 2001, net revenue backlog of AsiaInfo was US$44 million, representing a 20 percent year-over-year increase and 50 to 54 percent of the forecasted net revenue. The moderate growth rate of net revenue is due largely to the temporary market slow down in the second half of 2001, as all major telecom operators slowed their spending during an industry-wide restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). . Another reason is that the company will generate more revenue from high-margin software solutions, and less from large network construction projects. As a result, the company's operating profit will grow at 60 to 70 percent year-over-year, much faster than net revenue growth. Excluding Bonson acquisition, 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. for fiscal year 2002 would be in the range of $0.30 to 0.35 per basic share. Earnings (excluding interest contribution) per share will grow 120 percent from 15 cents in 2001 to 33 cents in 2002. Q1 2002 Pro Forma Guidance (Including Bonson) AsiaInfo expects Q1 2002 pro forma net revenue to be US$16.5 to 17 million. Bonson's contribution to Q1 net revenue is expected to be approximately 12 percent. Operating income is expected to be approximately US$0.6 to 0.8 million. Net income is expected to be about US$1 million, or $0.02 per basic share. Bonson's contribution to net income is expected to be approximately 50 percent. Fourth Quarter and Year-End Conference Call AsiaInfo will host a conference call to discuss its fourth quarter and year-end results and details about the acquisition of Bonson Technology at 4:00 p.m. Pacific Time / 7:00 p.m. Eastern Time (Beijing/Hong Kong Kong is the Danish word for king, but can also refer to the following:
A replay will be available by dialing 877-519-4471 for US callers or 973-341-3080 for international callers with a personal identification number (PIN) of 3033213 between 4:00 p.m. Pacific Time on January 22, 2002 until 4:00 p.m. Pacific Time on February February: see month. 23, 2002. Live and archived web casts of this call also will be available on the Investor Relations section of the AsiaInfo web site at www.asiainfo.com.
ASIAINFO HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in thousands of US$)
Three Months Year
Ended Dec 31 Ended Dec 31
2001 2000 2001 2000
Revenues:
Network solutions 31,126 38,330 161,131 158,695
Software 6,518 5,682 27,875 17,368
Software license 5,361 5,414 24,046 16,558
Software service 1,157 268 3,829 810
Total revenues 37,644 44,012 189,006 176,063
Cost of revenues:
Network solutions 21,083 31,932 129,713 141,668
Software 1,257 1,172 3,821 3,030
Software license 36 15 39 44
Software service 1,221 1,157 3,782 2,986
Total cost of revenues 22,340 33,104 133,534 144,698
Gross Profit 15,304 10,908 55,472 31,365
Operating expenses:
Sales and marketing 3,999 6,443 21,769 19,734
General and
administrative 4,209 3,618 14,905 12,892
Research and
development 1,782 1,541 7,304 5,974
Amortization
of deferred stock
compensation 208 459 1,144 2,210
Total operating
expenses 10,198 12,061 45,122 40,810
(Loss) income
from operations 5,106 -1,153 10,350 -9,445
Other income
(expenses):
Interest income 910 2,416 7,135 7,919
Interest expense -86 -138 -969 -1,033
Other income, net -19 171 -58 -21
Total other
income, net 805 2,449 6,108 6,865
Income before
income taxes,
minority interests
and equity in
loss of affiliated 5,911 1,296 16,458 -2,580
Income tax expense 1,183 286 3,444 218
Minority interests -160 13 -396 32
Equity in loss
of affiliate -309 0 -885 0
Net (loss) income 4,259 1,023 11,733 -2,766
Net (loss)
income per share
Basic 0.10 0.03 0.28 -0.07
Diluted 0.09 0.02 0.26 -0.07
Shares used
in computation
Basic 42,070,468 40,556,680 41,525,159 37,239,649
Diluted 46,629,538 44,190,092 45,924,724 37,239,649
Segment information
Network solutions
net of hardware
cost 13,495 8,390 43,516 27,210
Software 6,518 5,682 27,875 17,368
Software license 5,361 5,414 24,046 16,558
Software service 1,157 268 3,829 810
Consolidated revenues
net of
hardware cost 20,013 14,072 71,391 44,578
Consolidated cost
of sales net of
hardware cost 4,709 3,164 15,919 13,213
Consolidated gross
profit 15,304 10,908 55,472 31,365
ASIAINFO HOLDINGS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In US$) Dec 31, 2001 Dec 31, 2000
ASSETS
Current Assets:
Cash and cash equivalents 110,634,635 48,833,956
Restricted cash 13,474,945 26,733,179
Short term investments 27,184,487 110,400,000
Accounts receivable, trade
(net of allowance for
doubtful accounts of
$545,013 and $1,093,582 at
Dec 31, 2000 and
December 31, 2001 respectively) 66,723,537 55,597,496
Inventories 1,180,160 8,876,010
Other current assets 13,696,243 3,749,255
Total current assets 232,894,007 254,189,896
Property, plant,
and equipment-net 5,375,519 6,339,751
Investment in affiliate 5,272,066
Other assets 2,317,945 3,473,417
Total assets 245,859,537 264,003,064
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Short-term bank loans 2,923,906 20,644,834
Accounts payable 23,789,295 42,037,151
Accrued employee benefit 9,088,443 10,019,624
Deferred Revenue 4,279,272 12,501,524
Income Taxes payable 4,743,019 307,373
Other Taxes payable 2,523,839 1,909,450
Other current liabilities 13,112,294 7,785,694
Total current liabilities 60,460,068 95,205,650
Minority interest 609,475 188,044
Stockholders' Equity:
Common stock, 50,000,000
shares authorized;
$0.01 parvalue, shares
issued and outstanding :
December 31, 2000
40,822,940;
December 31 ,2001
42,132,818 421,328 408,229
Additional paid-in capital 178,649,268 175,370,544
Deferred stock compensation (512,071) (1,655,821)
Retained earnings
(accumulated deficit) 6,203,313 (5,530,601)
Accumulated other
comprehensive income (loss) 28,156 17,019
Total stockholders' equity 184,789,994 168,609,370
Total Liabilities and
Stockholders' Equity 245,859,537 264,003,064
About AsiaInfo Holdings, Inc. AsiaInfo Holdings, Inc. (Nasdaq: ASIA) is a leading provider of telecom network integration and software solutions in China. Its customer management and billing software products meet the complex, mission-critical provisioning, accounting, reporting and marketing needs of Internet and 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. . The company's convergent software suite also includes carrier-scale messaging and network management products. AsiaInfo constructs backbones, provincial and access networks for China's telecom carriers while providing high-end high-end adj. Informal 1. Appealing to sophisticated and discerning customers: a high-end department store; high-end video equipment. 2. network solutions including operations support, network management and security, and service applications. Registered in Delaware Delaware, state, United States Delaware (dĕl`əwâr, –wər), one of the Middle Atlantic states of the United States, the country's second smallest state (after Rhode Island). , AsiaInfo has served as a chief architect of China's Internet infrastructure since 1995, crafting 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 Mobile, 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. , and 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. . For more information about AsiaInfo, please visit http://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, 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 and information statements and other information regarding registrants that file electronically with the Commission. |
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