BEIJING, Dec. 5, 2016 /PRNewswire/ -- KongZhong
Corporation (NASDAQ: KZ), a leading online game publisher and
developer in the PRC, today announced its unaudited financial
results for the third quarter of 2016.
Third Quarter 2016 Financial Highlights
- Total revenues for the third quarter of 2016 were US$40.97 mn, an 11.61% decrease from the second
quarter of 2016 but a 6.19% increase from the same period last
year.
- Total gross profit was US$18.97
mn, a 16.32% decrease from the second quarter of 2016 but a
12.24% increase from the same period last year.
- Net income was US$5.34 mn, with
diluted net income per American Depositary Shares ("ADS") of
US$0.11.
- Non-GAAP net income was US$6.17
mn, a 24.91% decrease from the second quarter of 2016 but a
35.90% increase from the same period last year, with Non-GAAP
diluted net income per ADS of US$
0.13 (Non-GAAP Financial Measures are described and
reconciled to the corresponding GAAP measures in the section titled
"Non-GAAP Financial Measures").
- As of September 30th 2016, the
Company had US$147.08 mn in cash and
cash equivalents, term deposits, held-to-maturity securities,
available-for-sale securities and restricted cash net of a
US$64.94 mn short-term bank loan. The
mark to fair value of the Company's investments in Ourgame and
Forgame were priced at HK$3.96 and
HK$8.81 per ordinary share,
respectively (or US$10.59 mn and
US$13.70 mn, respectively) as of
September 30th 2016, compared to the
mark to fair value of the Company's investments in Ourgame and
Forgame which were priced at HK$3.47
and HK$10.10 per ordinary share,
respectively (or US$9.27 mn and
US$15.70 mn, respectively) as of
June 30th 2016.
Business Highlights
- The Company will continue to concentrate its efforts in
Internet Games and Mobile games around its War Saga game platform,
China's leading military genre
online game platform.
|
Three Months
Ended
|
|
September
30,
|
|
June
30,
|
|
September
30,
|
|
2015
|
|
2016
|
|
2016
|
|
US$ in
thousands
|
|
US$ in
thousands
|
|
US$ in
thousands
|
|
|
|
|
|
|
Revenues
|
38,579
|
|
46,348
|
|
40,969
|
Internet Games
|
23,745
|
|
32,929
|
|
29,953
|
Mobile Games
|
2,679
|
|
5,430
|
|
5,329
|
WVAS
|
12,155
|
|
7,989
|
|
5,687
|
|
|
|
|
|
|
Cost of
Revenues
|
21,676
|
|
23,675
|
|
21,997
|
Internet Games
|
11,038
|
|
14,053
|
|
13,807
|
Mobile Games
|
1,607
|
|
3,133
|
|
3,567
|
WVAS
|
9,031
|
|
6,489
|
|
4,623
|
|
|
|
|
|
|
Gross
Profit
|
16,903
|
|
22,673
|
|
18,972
|
Internet Games
|
12,707
|
|
18,876
|
|
16,146
|
Mobile Games
|
1,072
|
|
2,297
|
|
1,762
|
WVAS
|
3,124
|
|
1,500
|
|
1,064
|
|
|
|
|
|
|
Gross
Margin
|
44%
|
|
49%
|
|
46%
|
Internet Games
|
54%
|
|
57%
|
|
54%
|
Mobile Games
|
40%
|
|
42%
|
|
33%
|
WVAS
|
26%
|
|
19%
|
|
19%
|
Revenues
Total revenues for the third quarter of 2016 were US$40.97mn, an 11.61% decrease from the second
quarter of 2016 but a 6.19% increase from the same period last
year.
Internet Games Revenues
Internet Game ("Net Game") revenues were US$29.95 mn in the third quarter of 2016, a 9.04%
decrease from the second quarter of 2016 but a 26.14% increase from
the same period last year.
For the third quarter of 2016, mainland China online game operations achieved average
monthly active users ("MAUs") of 2.14 mn and aggregated monthly
paying accounts ("APAs") of 340k with monthly average revenue per
user ("ARPU") of RMB 192.
|
Three Months
Ended
|
September
30,
2015
|
June
30,
2016
|
September
30,
2016
|
MAU
|
1,813k
|
2,410k
|
2,144k
|
APA
|
307k
|
389k
|
340k
|
ARPU
|
160
|
181
|
192
|
Internet game revenues made up 73.1% of total revenues in the
third quarter of 2016.
Mobile Games Revenues
Total mobile game revenues were US$5.33
mn, a 1.86% decrease from the second quarter of 2016 but a
98.92% increase from the same period last year. The increase in
mobile game revenues was due to the newly launched mobile games in
the Chinese domestic market and overseas.
Total mobile game revenues made up 13.0% of total revenues in
the third quarter of 2016.
WVAS Revenues
WVAS revenues were US$5.69 mn, a
28.81% decrease from the second quarter of 2016 and a 53.21%
decrease from the same period of last year.
WVAS made up 13.9% of total revenues in the third quarter of
2016.
Gross Profit
Total gross profit for the third quarter of 2016 was
US$18.97 mn, a 16.32% decrease from
gross profit in the second quarter of 2016 but a 12.25% increase
from gross profit in the same period last year.
Total gross margin was 46.3% in the third quarter of 2016
compared to gross margins of 48.9% in the second quarter of
2016.
Internet Game Gross Profit
Internet game gross profit was US$16.15
mn, a 14.46% decrease from gross profits in the second
quarter of 2016 but a 27.07% increase from gross profit in the same
period last year. Internet game gross margin was 53.9% compared to
57.3% in the second quarter of 2016.
Mobile Game Gross Profit
Mobile games gross profit was US$1.76
mn, a 23.29% decrease from the second quarter of 2016 but a
64.37% increase from the same period last year. Mobile games gross
margin was 33.1% compared to 42.3% in the second quarter of
2016.
WVAS Gross Profit
WVAS gross profit was US$1.06 mn,
a 29.07% decrease from the second quarter of 2016 and a 65.94%
decrease from the same period last year. WVAS gross margin was
18.7% compared to 18.8% in the second quarter of 2016.
Operating Expenses
Total operating expenses in the third quarter of 2016 were
US$15.10 mn compared to US$18.68 mn in the second quarter of 2016.
Product development expenses in the third quarter of 2016 were
US$5.47 mn compared to US$5.61 mn in the second quarter of 2016.
Sales and marketing expenses in the third quarter of 2016 were
US$6.63 mn compared to US$9.12 mn in the second quarter of 2016. Sales
and marketing expenses decreased primarily due to the decreased
promotion activities of some of our Internet games in the third
quarter.
General and administrative expenses in the third quarter of 2016
were US$3.00 mn compared to
US$2.23 mn in the second quarter of
2016.
The Company's total headcount in the third quarter of 2016 was
837 staff compared to 822 staff at the end of the second quarter of
2016.
Earnings
US GAAP net income and diluted income per ADS were US$5.34 mn and US$
0.11, respectively. Non-GAAP net income and diluted income
per ADS were US$6.17 mn and
US$ 0.13, respectively.
Total ADS on a diluted basis outstanding during the third
quarter of 2016 were 47.30 mn, compared to 47.32 mn outstanding
during the second quarter of 2016.
For the purpose of
earnings
per share calculation
|
Number during
three
months ended
June 30, 2016
|
Number during
three
months ended
September 30,
2016
|
ADS (in
mns)
|
47.10
|
47.10
|
Add: Dilution impact
from
options and nonvested shares
|
0.18
|
0.17
|
Warrants issued to
business
partners
|
0.04
|
0.03
|
ADS on diluted
basis
|
47.32
|
47.30
|
Recent Developments
On June 29, 2015, the Company
announced that its board of directors (the "Board") had received a
preliminary non-binding proposal letter from Leilei Wang, chairman and chief executive
officer of the Company, and IDG-Accel China Growth Fund II L.P. to
acquire all of the outstanding ordinary shares of the Company not
owned by them or their affiliates for US$8.56 in cash per American depositary share
(the "ADS", each representing forty ordinary shares) (the "Going
Private Proposal").
On July 8, 2015, the Company
announced that the Board has formed a special committee (the
"Special Committee") consisting of two independent directors,
Hope Ni and Xiaolong Li, and delegated to the Special
Committee the exclusive power and authority of the Board to, among
other things, evaluate and respond to the Going Private Proposal.
Ms. Ni is serving as the chair of the Special Committee.
On November 3, 2015, the Company
announced that the Special Committee has retained Duff &
Phelps, LLC and Duff & Phelps Securities LLC as its financial
advisors and Skadden, Arps, Slate, Meagher & Flom as its legal
counsel in connection with its review and evaluation of the Going
Private Proposal.
On August 25, 2016, the Company
announced the Board received a revised non-binding proposal letter,
dated August 25, 2016, from Mr.
Leilei Wang, and IDG-Accel China
Growth Fund II L.P., who, together with certain other parties,
formed a buyer group (the "Buyer Group") to acquire all of the
outstanding ordinary shares of the Company not owned by them or
their affiliates for US$7.18 in cash
per ADS, or approximately US$0.1795
per ordinary share.
On December 1, 2016, following the
unanimous recommendation of the Special Committee and the approval
by the Board, the Company entered into a definitive agreement and
plan of merger (the "Merger Agreement") with affiliates of the
Buyer Group. Pursuant to the terms of the Merger Agreement, at the
effective time of the merger, each ordinary share of the Company
issued and outstanding immediately prior to the effective time of
the merger will be cancelled in exchange for the right to receive
$0.18875 in cash, and each ADS will
be cancelled in exchange for the right to receive $7.55 in cash, except for shares owned by certain
affiliates of the Buyer Group and dissenting shares.
The merger is subject to customary closing conditions, including
the approval of the Merger Agreement by the affirmative vote of
holders of ordinary shares representing at least two-thirds of the
voting power of the ordinary shares present and voting in person or
by proxy at a meeting of the Company's shareholders convened to
consider the approval of the Merger Agreement and the merger.
The Company does not undertake any obligation to provide any
updates with respect to this or any other proposed transaction,
except as required under applicable law.
Conference Call
KongZhong's management will hold a conference call and live
webcast to discuss the results at 7:30 PM
Eastern Standard Time (EST) on Monday, December 5, 2016 (8:30 AM Beijing/Hong
Kong time, Tuesday, December 6,
2016)
The Company welcomes all interested parties to participate in
the live conference call. An Operator will greet you and ask for
the Conference ID shown as following.
Conference ID: 24978558
The dial-in details are as below:
- U.S. Toll Free Dial-in Number: +1 866 519 4004
- U.S. Dial-in Number: +1 845 675 0437
- Hong Kong Toll Free Dial-in Number: 800 906 601
- Hong Kong Dial-in Number: +852 3018 6771
- Mainland China Dial-in Number: 800 819 0121, 400 620 8038
- International Dial-in Number: +65 6713 5090
The live conference call via webcast and archive replay will be
available on the Investor Relations section of KongZhong's website
at http://ir.kongzhong.com. The archive replay will be available on
the website shortly after the call.
A dial-in replay of the conference call will be available until
December 13, 2016 (EST):
- U.S. Toll Free Dial-in Number: +1 855 452 5696
- U.S. Dial-in Number: +1 646 254 3697
- Hong Kong Toll Free Dial-in Number: 800 963 117
- Hong Kong Dial-in Number: +852 3051 2780
- Mainland China Toll Free Dial-in Number: 800 870 0206, 400 602
2065
- International Dial-in Number: +61 2 8199 0299
About KongZhong
KongZhong Corporation (NASDAQ: KZ), listed on Nasdaq in 2004, is
a leading online game developer and operator in China. KongZhong operates three main business
units, namely Internet Games, Mobile Games and WVAS. Under Internet
Games, KongZhong operates the largest Chinese military gaming
platform under the "WAR SAGA" brand, which includes games such as
World of Tanks, World of Warplanes and World of Warships. KongZhong
has the exclusive publishing rights for World of Tanks, World of
Warplanes, World of Warships, Guild Wars 2, Blitzkrieg 3 and other
titles in Mainland China.
KongZhong entered the smartphone game industry in 2011 through
an acquisition of smartphone game engine and has expanded its
mobile game development team across 4 cities across Mainland China.
KongZhong offers popular mobile games in China and overseas with over 10 smartphone
games across various genres being under development, including RPG,
RTS, military, fantasy and etc. For more information, please visit
http://ir.kongzhong.com.
Safe Harbor Statements
This press release contains "forward-looking statements" within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934, as amended.
Such forward-looking statements include, without limitation,
statements regarding trends in the wireless value-added services,
wireless media, mobile games and online games industries and our
future results of operations, financial condition and business
prospects. Although such statements are based on our own
information and information from other sources we believe to be
reliable, you should not place undue reliance on them. These
statements involve risks and uncertainties, and actual market
trends and our results may differ materially from those expressed
or implied in these forward looking statements for a variety of
reasons. Potential risks and uncertainties include, but are
not limited to, continued competitive pressure in China's wireless value-added services,
wireless media, mobile games and online games industries and the
effect of such pressure on revenues; our ability to develop new
products that are commercially successful; unpredictable changes in
technology, consumer demand and usage preferences in the markets we
operate; our ability to protect our intellectual property rights;
the short operating history of certain of our business segments, in
particular the online games segment; the state of and any
change in our relationship with China's telecommunications operators; our
dependence on the billing systems of telecommunications operators
for our performance; the outcome of our investment of operating
income generated from the WVAS segment into the development of our
wireless Internet, mobile games and online games segments; changes
in the regulations or policies of the Ministry of Industry and
Information Technology and other government authorities relevant to
our businesses; and changes in political, economic, legal and
social conditions in China,
including the Chinese government's policies with respect to
economic growth, foreign exchange, foreign investment and entry by
foreign companies into China's
telecommunications and online games markets. For additional
discussion of these risks and uncertainties and other factors,
please see the documents we file from time to time with the
Securities and Exchange Commission. We assume no obligation to
update any forward-looking statements, which apply only as of the
date of this press release.
KongZhong
Corporation
|
Condensed
Consolidated Statements of Comprehensive Income
|
(Unaudited, US$ in
thousands, except per share and share data)
|
|
|
|
Three Months
Ended
|
|
|
|
September
30,
|
|
June
30,
|
|
September
30,
|
|
|
|
2015
|
|
2016
|
|
2016
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
38,579
|
|
46,348
|
|
40,969
|
|
Cost of
revenues
|
|
21,676
|
|
23,675
|
|
21,997
|
|
Gross
profit
|
|
16,903
|
|
22,673
|
|
18,972
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
|
|
|
Product development
|
|
5,772
|
|
5,605
|
|
5,471
|
|
Sales and marketing
|
|
5,198
|
|
9,121
|
|
6,627
|
|
General and administrative
|
|
2,202
|
|
2,230
|
|
3,000
|
|
Recognition of prepaid
license fees of games
|
|
-
|
|
1,716
|
|
-
|
|
Total operating
expenses
|
|
13,172
|
|
18,672
|
|
15,098
|
|
|
|
|
|
|
|
|
|
Government
subsidy
|
|
265
|
|
121
|
|
367
|
|
|
|
|
|
|
|
|
|
Income from
operations
|
|
3,996
|
|
4,122
|
|
4,241
|
|
|
|
|
|
|
|
|
|
Interest
income
|
|
1,158
|
|
2,337
|
|
2,269
|
|
Interest
expense
|
|
(281)
|
|
(397)
|
|
(511)
|
|
Impairment loss on
long-term investments
|
|
-
|
|
(1,972)
|
|
-
|
|
Exchange
loss
|
|
(557)
|
|
(81)
|
|
(67)
|
|
Income before
income tax expense, loss on equity
method investments
|
|
4,316
|
|
4,009
|
|
5,932
|
|
Income tax
expense
|
|
(142)
|
|
(201)
|
|
(191)
|
|
Loss on equity method investments, net of
income tax
|
|
(273)
|
|
(414)
|
|
(404)
|
|
Net
income
|
|
3,901
|
|
3,394
|
|
5,337
|
|
|
|
|
|
|
|
|
|
Earnings per ADS,
basic
|
|
0.08
|
|
0.07
|
|
0.11
|
|
Earnings per ADS,
diluted
|
|
0.08
|
|
0.07
|
|
0.11
|
|
Weighted average ADS
outstanding (million)
|
|
46.78
|
|
47.10
|
|
47.10
|
|
Weighted average ADS used in diluted EPS
calculation (million)
|
|
47.21
|
|
47.32
|
|
47.30
|
|
Net income
|
|
3,901
|
|
3,394
|
|
5,337
|
|
Other comprehensive
loss
|
|
(40,333)
|
|
(10,614)
|
|
(2,451)
|
|
Total comprehensive
(loss) income
|
|
(36,432)
|
|
(7,220)
|
|
2,886
|
|
Less: Comprehensive loss attributable to
non-controlling interest
|
|
-
|
|
(21)
|
|
(47)
|
|
Total comprehensive
(loss) income
attributable to
KongZhong Corporation
|
|
(36,432)
|
|
(7,199)
|
|
2,933
|
|
KongZhong
Corporation
|
Condensed
Consolidated Balance Sheets
|
(Unaudited, US$ in
thousands)
|
|
|
|
|
|
|
|
|
|
|
As
of September
30,
|
|
As
of
June 30,
|
|
As
of September
30,
|
|
2015
|
|
2016
|
2016
|
|
Assets
|
|
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
33,139
|
|
64,972
|
|
57,749
|
|
Term deposits
|
|
26,047
|
|
124
|
|
16,087
|
|
Available-for-sale
securities
|
|
52,563
|
|
24,970
|
|
24,284
|
|
Held-to-maturity securities
|
|
17,083
|
|
50,706
|
|
45,938
|
|
Accounts receivable (net)
|
|
24,235
|
|
27,357
|
|
19,665
|
|
Restricted cash
|
|
18,230
|
|
65,297
|
|
67,955
|
|
Other current assets
|
|
71,209
|
|
75,980
|
|
76,297
|
|
Total current
assets
|
|
242,506
|
|
309,406
|
|
307,975
|
|
|
|
|
|
|
|
|
|
Non-current
assets
|
|
|
|
|
|
|
|
Rental deposits
|
|
1,385
|
|
1,430
|
|
1,501
|
|
Intangible assets (net)
|
|
13,392
|
|
10,310
|
|
11,202
|
|
Property and equipment (net)
|
|
5,078
|
|
3,651
|
|
3,493
|
|
Long-term investments
|
|
3,844
|
|
4,611
|
|
12,308
|
|
Goodwill
|
|
86,553
|
|
82,991
|
|
82,442
|
|
Restricted cash
|
|
40,872
|
|
17,795
|
|
-
|
|
Total non-current
assets
|
|
151,124
|
|
120,788
|
|
110,946
|
|
Total
assets
|
|
393,630
|
|
430,194
|
|
418,921
|
|
|
|
|
|
|
|
|
|
Liabilities and
Shareholders' Equity
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
Accounts payable
(including accounts payable of the
consolidated variable interest entities
("VIE") without recourse to KongZhong
Corporation of $23,579, $21,659 and
$17,316 as of September 30, 2015, June 30,
2016 and September 30, 2016, respectively)
|
|
23,590
|
|
21,677
|
|
17,329
|
|
Short-term bank
loan
(including short-term
bank loan of the
consolidated VIE without recourse to
KongZhong Corporation of $nil, $15,078
and $14,973 as of September 30, 2015, June
30, 2016 and September 30, 2016,
respectively)
|
|
7,534
|
|
65,040
|
|
64,935
|
|
Deferred revenue
(including deferred revenue of the
consolidated VIE without recourse to
KongZhong Corporation of $2,831,
$12,181 and $5,229 as of September 30,
2015, June 30, 2016 and September 30,
2016, respectively)
|
|
2,860
|
|
12,210
|
|
5,258
|
|
Other current
liabilities
(including other current liabilities of the
consolidated VIE without recourse to
KongZhong Corporation of $8,636,
$19,426 and $15,764 as of September 30,
2015, June 30, 2016 and September 30,
2016, respectively)
|
|
16,673
|
|
24,691
|
|
21,790
|
|
|
|
|
|
|
|
|
|
Total current
liabilities
|
|
50,657
|
|
123,618
|
|
109,312
|
|
|
|
|
|
|
|
|
|
Non-current
Liabilities
|
|
|
|
|
|
|
|
Long-term bank
loan
(including long-term
bank loan of the
consolidated VIE without recourse to
KongZhong Corporation of $nil, $nil
and $nil as of September 30, 2015, June 30,
2016 and September 30, 2016, respectively)
|
|
42,429
|
|
-
|
|
-
|
|
Total
liabilities
|
|
93,086
|
|
123,618
|
|
109,312
|
|
|
|
|
|
|
|
|
|
Total KongZhong
Corporation shareholders' equity
|
|
300,544
|
|
306,597
|
|
309,677
|
|
Non-controlling interest
|
|
-
|
|
(21)
|
|
(68)
|
|
Shareholders'
equity
|
|
300,544
|
|
306,576
|
|
309,609
|
|
Total liabilities
and shareholders' equity
|
|
393,630
|
|
430,194
|
|
418,921
|
|
KongZhong
Corporation
|
Condensed
Consolidated Statements of Cash Flows
|
(Unaudited, US$ in
thousands)
|
|
|
Nine Months Ended
|
|
|
|
September
30,
|
|
September
30,
|
|
|
|
2015
|
|
2016
|
|
Cash Flows From
Operating Activities
|
|
|
|
|
|
Net income (loss)
|
|
(22,326)
|
|
34,334
|
|
Adjustments to reconcile net income to net cash
provided by operating activities
|
|
|
|
|
|
Depreciation and amortization
|
|
8,752
|
|
4,338
|
|
Loss on disposal of
property and equipment
|
|
50
|
|
-
|
|
Gain on sale of
available-for-sale securities
|
|
-
|
|
(19,781)
|
|
Imputed interest on long-term liabilities
|
|
140
|
|
-
|
|
Loss on equity method
investments
|
|
419
|
|
1,365
|
|
Share-based compensation
|
|
702
|
|
388
|
|
Impairment loss on
intangible assets
|
|
35,210
|
|
230
|
|
Impairment loss on
long-term investments
|
|
-
|
|
1,972
|
|
Changes in operating assets and liabilities
|
|
(8,597)
|
|
(3,171)
|
|
Net Cash Provided by
Operating Activities
|
|
14,350
|
|
19,675
|
|
|
|
|
|
|
|
Cash Flows From
Investing Activities
|
|
|
|
|
|
Purchase of term
deposits
|
|
(9,989)
|
|
(16,053)
|
|
Proceeds from disposal of term deposits
|
|
815
|
|
24,944
|
|
Acquisition of equity
method investment
|
|
(1,881)
|
|
-
|
|
Acquisition of cost
method investment
|
|
-
|
|
(920)
|
|
Temporary
advances
|
|
(3,264)
|
|
-
|
|
Purchase of held-to-maturity securities
|
|
(50,239)
|
|
(81,363)
|
|
Purchase of available-for-sale securities
|
|
(27,127)
|
|
(2,088)
|
|
Proceeds from disposal
of available-for-sale securities
and dividend received
|
|
2,129
|
|
25,957
|
|
Proceeds from disposal of held-to-maturity securities
|
|
56,882
|
|
60,874
|
|
Purchase of property and equipment
|
|
(1,837)
|
|
(642)
|
|
Purchase of intangible
assets
|
|
-
|
|
(300)
|
|
Addition of restricted
cash
|
|
(8,145)
|
|
(27,729)
|
|
Release of restricted
cash
|
|
9,989
|
|
16,053
|
|
Acquisition of
subsidiaries
|
|
-
|
|
(37)
|
|
Loans to equity method
investee
|
|
(28,860)
|
|
(20,523)
|
|
Loan repayment from
third party
|
|
3,201
|
|
13,300
|
|
Loan repayment from
equity method investee
|
|
-
|
|
6,434
|
|
Loan to related
party
|
|
-
|
|
(3,393)
|
|
Loan repayment from
related party
|
|
-
|
|
626
|
|
Loan to third
party
|
|
(25,003)
|
|
-
|
|
Net Cash Used in
Investing Activities
|
|
(83,329)
|
|
(4,860)
|
|
|
|
|
|
|
|
Cash Flows From
Financing Activities
|
|
|
|
|
|
Proceeds from exercise of employee stock options
|
|
618
|
|
81
|
|
Deferred payments for intangible assets
|
|
(10,396)
|
|
(10,158)
|
|
Proceeds from bank borrowing
|
|
7,534
|
|
15,324
|
|
Net Cash (Used in)
Provided by Financing Activities
|
|
(2,244)
|
|
5,247
|
|
|
|
|
|
|
|
Effect of foreign
exchange rate changes
|
|
(731)
|
|
(617)
|
|
|
|
|
|
|
|
Net (decrease)
increase in Cash and Cash Equivalents
|
|
(71,954)
|
|
19,445
|
|
Cash and Cash
Equivalents, Beginning of Period
|
|
105,093
|
|
38,304
|
|
Cash and Cash
Equivalents, End of Period
|
|
33,139
|
|
57,749
|
|
Non-GAAP Financial
Measures
|
|
To supplement the
unaudited condensed statements of comprehensive income presented in
accordance
with US GAAP, the Company uses non-GAAP financial measures
(Non-GAAP Financial Measures) of
net income and net income per diluted ADS, which are adjusted from
results based on GAAP to exclude
certain infrequent or unusual or non-cash based expenses, gains and
losses. The Non-GAAP Financial
Measures are provided as additional information to help both
management and investors compare business
trends among different reporting periods on a consistent and more
meaningful basis and enhance investors'
overall understanding of the Company's current financial
performance and prospects for the future.
The Non-GAAP Financial Measures should be considered in addition to
results prepared in accordance
with GAAP, but should not be considered a substitute for or
superior to GAAP results. In addition, the
Company's calculation of the Non-GAAP Financial Measures may be
different from the calculation used
by other companies, and therefore comparability may be limited.
For the periods presented, the Company's non-GAAP net income and
non-GAAP net income per diluted
ADS exclude, as applicable, the amortization of intangibles,
share-based compensation expense,
impairment of intangible assets, investment impairment loss, as
well as recognition of prepaid license fees
for games are adjusted for the dilution impact on ADS numbers from
stock options, non-vested shares and
warrants.
Reconciliation of the Company's Non-GAAP financial measures to the
GAAP financial measures is set
forth below.
|
|
(US$ in thousands,
except per share and share data)
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
September30,
|
|
June
30,
|
|
September
30,
|
|
|
|
2015
|
|
2016
|
|
2016
|
|
|
|
|
|
|
|
|
|
|
GAAP net
income
|
3,901
|
|
3,394
|
|
5,337
|
|
|
Share-based
compensation
|
234
|
|
122
|
|
122
|
|
|
Amortization of
intangibles
|
403
|
|
779
|
|
708
|
|
|
Impairment loss on
intangible assets
|
-
|
|
230
|
|
-
|
|
|
Investment
impairment loss
|
-
|
|
1,972
|
|
-
|
|
|
Recognition of
prepaid license fees for
games
|
-
|
|
1,716
|
|
-
|
|
|
Non-GAAP net
income
|
4,538
|
|
8,213
|
|
6,167
|
|
|
|
|
|
|
|
|
|
|
Weighted average ADS
used in diluted EPS
calculation (million)
|
47.21
|
|
47.32
|
|
47.30
|
|
|
Non-GAAP diluted net
income per ADS
|
0.10
|
|
0.17
|
|
0.13
|
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/kongzhong-corporation-reports-third-quarter-2016-unaudited-financial-results-300372658.html
SOURCE KongZhong Corporation