Printer Friendly

CyberAgent Reports Third Quarter Results; Net Sales Rise 13.5%, Operating, Ordinary Income Improve.

Tokyo, Aug 12, 2008 - (JCN Newswire) - CyberAgent, Inc. (TSE: 4751; ISIN: JP3311400000), a Tokyo-based leader in Internet media markets, has reported consolidated results for the third quarter ending June 30, 2008, with net sales rising 13.5% to 63,825 million yen, and operating income and ordinary income also rising on the previous third quarter.

These gains were driven by solid growth in site listing (search results) advertising for the Internet advertising agency business, as well as firm mobile advertising for the Internet media (advertising/fee collection/content) business.

Operating income rose 1.1% to 3,616 million yen from 3,576 million yen in the previous term. Although there were upfront investments to expand page views for Ameba, there was an increase in income as a result of greater sales for the internet advertising agency business, firm earnings from foreign exchange margin transactions and mobile advertising for the internet media (advertising/fee collection/contents) business, and contributions to income from the disposal of shares in Mixi Inc. by the investment development business.

Net income fell 34.9% to 827 million yen from the 1,271 million yen in the previous term, following extraordinary losses of 885 million yen on the evaluation of securities held for investment purposes and tax expenses, including income tax and adjustments to income taxes.

The Internet business market continues to expand, bolstered by the diffusion of the broadband environment and the introduction of flat-rate systems for mobile phones. According to Dentsu Inc., the Internet advertising market grew 24.4% from 482.6 billion yen in 2006 to 600.3 billion yen in 2007, surpassing both radio advertising and magazine advertising. The Internet business market is likely to expand even further, with the development of diverse Internet media, expansion of the EC market, and possibilities for new services.

In this promising environment, the CyberAgent Group has continued to work to strengthen its Group media, centered on the blog media Ameba, to reinforce its marketing power through its Internet advertising agency business, and to broaden its investment development business that makes use of the other two businesses. In particular, the company will continue upfront investments and considers page views (PVs) as the most important indicator when developing the blog media Ameba, the company's core media.

I. Third Quarter Financial Summary (Oct 1, 2007 - June 30, 2008)
(1) Consolidated Operating Results
------------------------------------------------------------------------
 (Millions of Yen)
 Third Quarter ended June 30, FY Sept 30,
 2008 % 2007 % 2007
------------------------------------------------------------------------
Net Sales 63,825 13.5 56,253 34.9 76,007
Operating Income 3,616 1.1 3,576 95.2 5,501
Ordinary Income 3,533 4.9 3,368 96.8 5,143
Net Income 827 (34.9) 1,271 (72.0) 2,016
Net Income/Share(Yen) 1,273.59 1,927.05 3,055.49
Net Income/Share,
 diluted(Yen) 63.18 57.45 3,050.70
------------------------------------------------------------------------
(2) Consolidated Financial Position
------------------------------------------------------------------------
 As of June 30, Sept 30,
 2008 2007 2007
------------------------------------------------------------------------
Total Assets 8,854 48,700 49,162
Shrhldrs' Equity 29,988 32,087 31,170
Shrhldrs' Equity Ratio 40.9% 54.3% 51.9%
Shrhldrs' Equity/Share (Yen) 37,135.18 40,053.31 38,645.57
------------------------------------------------------------------------
(3) Consolidated Cash Flows
------------------------------------------------------------------------
 Third Quarter ended June 30, FY Sept.30,
 2008 2007 2007
------------------------------------------------------------------------
Cash Flow from Operating Activities 1,635 489 2,849
Cash Flow from Investing Activities (2,479) (3,482) (4,631)
Cash Flow from Financing Activities (1,203) (458) (102)
Cash and Cash Equivalents
 at Period End 15,814 16,487 17,848
------------------------------------------------------------------------


II. Results by Business Segment

The traditional business segments - internet media business (advertising, EC (sales), EC (commission/fee collection), and other), internet advertising agency business (company tie-up media, other company media, and other), and investment development business) - were based on business division criteria from an internal management perspective. However, internal management divisions and traditional business segment divisions were no longer consistent since the blog business, centered on the blog media Ameba, was designated the priority business; there had been a reorganization in order to develop the blog business as a core business; and advertising and earnings types had become more diversified following changes in the Internet market. Therefore, business segments were reorganized into the internet media business (blog), internet media business (advertising/fee collection/contents), internet media business (commerce), internet advertising agency business, and the investment development business, making them consistent with internal management divisions.

Also within the group, the Internet advertising agency business and Internet media business have a common business model, and there are many transactions between the Internet Advertising Agency Business Division and the Internet Media Business Division since the Internet Advertising Agency Business Division handles advertising that is part of the Internet media business. Since the above changes to segments has resulted in business segments with a high percentage of sales accounted for by internal sales, both "sales to outside customers" and "sales and transfers between segments" are given in the segment information in the full report, but sales listed in this summary are the total of "sales to outside customers" and "sales and transfers between segments" since this appropriately reflects actual business conditions.

Figures for the previous term given in the narrative were calculated using the segments after the change.

1) Internet Media Business - Blog

This business includes Ameba, the blog media operated by the company, the blog advertising distribution service MicroAd operated by MicroAd, and the word-of-mouth marketing business within Cyber Buzz that generates derivative word of mouth by networking influential bloggers (influencers) through blogs. The increase in page views (PVs) for Ameba is considered the most important indicator, and the number of page views for June 2008 had risen to 4.61 billion, a dramatic increase of 3.27 billion compared to the 1.34 billion for June 2007, following continued upfront investments.

Therefore, sales for the segment rose 86.8% to 2,474 million yen from 1,324 million in the previous term, and the business posted an operating loss of 1,384 million yen compared to an operating loss of 1,519 million yen for the previous term.

2) Internet Media Business - advertising/fee collection/content

This business segment includes mobile advertising, centered on the mobile portal ixen operated by CA MOBILE, Ltd., the price comparison site operated by EC Navi, online game fee collection service provided by GCREST Co., Ltd., and financial operations such as foreign exchange margin transaction business operated by CyberAgent FX. As a result of aggressive advertising and firm growth in the number of members, sales increased 53.7% to 19,012 million yen from 12,373 million yen in the pervious term, and the business recorded operating income of 2,704 million yen compared to a 305 million operating income for the previous term.

3) Internet Media Business - commerce

The business segment includes online shopping businesses, including the mobile and PC "gathering" (joint purchasing) operated by netprice.com, ltd., and "ONE*FESTA" operated by CA Mobile, Ltd. The CyberAgent Group worked to improve the profitability of the business, which included efforts such as reducing expenses by concentrating on particular sales locations, shrinking inventories, and structuring operations.

Therefore, sales for the segment fell 12.0% to 13,169 million yen from 14,962 million yen for the previous term, and the business was able to record operating income of 609 million yen compared to an operating loss of 405 million yen for the previous term.

4) Internet Advertising Business

This business segment includes the Internet advertising agency business, centered on the company's Internet Advertising Management Division, the SEM (search engine marketing) business, and the Ad Network business. There are growing customer needs and a greater volume of site listing advertising, and the business has worked to capture demand for SEO (search engine optimization) which is rapidly growing.

As a result, sales for the segment increased 21.9% to 30,949 million yen from 25,393 million in the previous term, and the company posted operating income of 483 million yen, a 292.0% increase compared to the 123 million for the previous term.

5) Investment Development Business

This business segment is composed mainly of the company's corporate venture capital business and fund management operations within CyberAgent Investment. The business has several responsibilities, including discovering, developing, and raising the value of promising venture companies with the goal of generating capital gains. For various reasons including the disposal of its holding in Mixi Inc., sales decreased 62.3% to 2,102 million yen from 5,570 million yen in the previous term, and operating income shrank 76.3% to 1,202 million yen from 5,073 million yen in the previous term.

III. Financial Position and Consolidated Cash Flows

Consolidated assets at the end of this third quarter rose 9,691 million yen from the end of the previous fiscal year to 58,854 million yen because of an increase in deposits received accompanying healthy growth in assets deposited as collateral for foreign exchange margin transactions although there was a decline in cash and deposits due to share buybacks and the payment of taxes.

Consolidated liabilities grew 10,873 million yen to 28,865 million yen as a result of the increase in deposited guarantees for foreign exchange margin transactions. Net assets decreased 1,181 million yen to 29,988 million yen because of a decrease in shareholder equity following a share buyback.

As a result, the equity ratio fell 11.0 percentage points from the end of the previous fiscal year to 40.9% at the end of the third quarter.

Cash and cash equivalents ("cash") at the end of the third quarter totaled 15,814 million yen, a decline of 2,033 million yen compared to the 17,848 million yen at the end of the previous fiscal year.

Cash flow from operating activities:

Cash flow derived from operating activities for the current third quarter was 1,635 million yen, as compared to a 489 million yen inflow for the previous third quarter. This was primarily due to the posting of income.

Cash flow from investing activities:

Cash flow used in investing activities for the current third quarter totaled 2,479 million yen, as compared to a 3,482 million yen outflow for the previous third quarter, primarily due to the purchases of fixed assets and stocks as investment securities.

Cash flow from financing activities:

Cash flow used in financing activities for the current third quarter was 1,203 million yen, as compared to a 458 million yen outflow for the previous third quarter, primarily due to the share buybacks and the payment of dividends.

IV. Outlook for the Second Half and Year Ending September 30, 2008

As for the outlook for the full fiscal year ending September 30, 2008, the Internet The Internet business market continues to expand at a firm pace, and the CyberAgent Group will record firm earnings in all business segments with the Internet media business, centered on the blog media Ameba, mobile business, and foreign exchange margin transaction business continuing to experience healthy growth and the scope of site listing advertising within the Internet advertising business expanding further.

The forecasts for consolidated and parent company sales, operating income, and ordinary income announced on December 19, 2007 were revised after taking into consideration the earning trend through the third quarter.

The forecast for consolidated sales was revised upward to 85,000 million yen from 81,200 million yen, for operating income to 4,300 million yen from 3,200 million yen, and for ordinary income to 4,100 million yen from 3,000 million yen. Taking into consideration the impact of items such as the extraordinary losses generated through the third quarter, there was no change in the projection of a net loss of 1,000 million yen.

The forecast for non-consolidated sales was revised to 43,000 million yen from 41,200 million yen, operating loss to 500 million yen from 800 million yen loss, and for ordinary loss to 500 million yen from 800 million yen loss.

There was no change in the forecast of a net loss of 1,400 million yen because of similar reasons as for the consolidated earnings projections.
 (millions of yen)
------------------------------------------------------------------------
Consolidated Fiscal Year ending September 30, 2008 %
------------------------------------------------------------------------
Net Sales 85,000 +11.8%
Ordinary Income 4,300 -21.8%
Operating Income 4,100 -20.3%
Net Income 1,000 -50.4%
Net Income per Share (Yen) 1,542.80
------------------------------------------------------------------------


The Cyberagent Group forecasts a FY2008 year-end dividend of 700 yen per share.

For more information, please visit the CyberAgent IR website at http://ir.cyberagent.co.jp/ir_e/

An online video of the analysts' presentation given in Tokyo on August 13, 2008 (in Japanese), will be available at http://ir.cyberagent.co.jp/

* Business results forecasts represent the judgment of the Company, based on information obtainable at the time of writing; they involve contributing factors such as risk and elements of uncertainty; hence actual results may differ from the forecast results.

* Taking into consideration the earnings trend through the third quarter, forecasts for consolidated and parent company earnings for the full fiscal year were revised upward. Refer to the attached material on page 5 or the press release Notice regarding Upward Revision of the Business Performance Forecast and Dividend Forecast for the FY2008 (August 12, 2008) for details of the revisions.

* Taking into consideration the earnings trends through the third quarter, overall earnings forecasts for the full fiscal year ending September 30, 2008, include forecasts for the investment development business.

About CyberAgent, Inc.

CyberAgent, Inc. (TSE: 4751; ISIN: JP3311400000) is a leading on-line advertising agency and media representative company. Established in 1998, and listed on the Tokyo Mothers Exchange in 2000, the CyberAgent group is committed to contributing to a new society through its work on the Internet, not only in its fields of advertising and media, but through finding promising new business and investing aggressively in developing new business. For more information, please visit http://ir.cyberagent.co.jp/ir_e/

Source: CyberAgent, Inc.

Contact:
CyberAgent
Public and Investor Relations Division
Akiko Kashiwa
kashiwa_akiko[at]cyberagent.co.jp
Tel: +81-3-5459-0227


Copyright 2008 JCN Newswire. All rights reserved. www.japancorp.net
COPYRIGHT 2008 Japan Corporate News Network K.K.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2008 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:JCN Newswires
Article Type:Financial report
Date:Aug 12, 2008
Words:2366
Previous Article:Mazda Expands Measures to Improve Employee Work-Life Balance.
Next Article:Toppan Supplies Transport/Financial Smart Card in Hong Kong.
Topics:


Related Articles
CyberAgent Reports Results for the First Quarter Ended Dec. 31, 2005.
CyberAgent Reports First Half Results; Group Sales Up 45.1%, Net Income Rises 163.6%.
CyberAgent Reports Third Quarter Results; Group Sales Up 38.8%, Net Income Rises 133.4%.
CyberAgent Reports Results for the Full Year Ended Sept. 30, 2006; Net Sales Rise 38.9%.
CyberAgent Reports First Quarter Results Ended Dec. 31, 2006; Net Sales Rise 36.3%.
CyberAgent Reports First Half Results; Group Sales Up 38.0%, Operating Income Rises 70.1%.
CyberAgent Reports 3Q Results; Group Sales Up 34.9%, Operating Income Rises 95.2%.
CyberAgent Reports Results for the Full Year; Net Sales Rise 26.4%, 0perating Income Rises 26.7%.
CyberAgent Reports First Quarter Results; Net Sales Rise, Operating Income Doubles.
CyberAgent Reports First Half Results; Group Sales Rise 12.4%, Operating Income Rises 41.2%.

Terms of use | Privacy policy | Copyright © 2019 Farlex, Inc. | Feedback | For webmasters