Tom.com looks to lift revenue at China unit
Thursday, January 23, 2003
biz.scmp.com
SIDNEY LUK in Xiamen
Tom.com hopes to boost turnover from its outdoor media group Tom OMG by a third this year by consolidating the operations of 12 mainland subsidiaries.
The multimedia investment company expects Tom OMG's revenue to reach HK$300 million last year and grow to HK$400 million this year.
Robert Xie Min, Tom.com's chief investment officer and Tom OMG president, said all the companies it had acquired since late 2000 had been making profits and had won contracts worth 45 million yuan (about HK$42.25 million) last year.
"This year, basically we want to do the right things, make sure each line of our business can perform as it is required. We want to make the company solid, to integrate and consolidate our business, so that we can achieve organic growth," he said.
Outdoor media operations account for 17 per cent of Tom.com's business, while 43 per cent comes from print and 14 per cent from online business.
Tom OMG recorded interim revenue of HK$142.93 million for the six months to June 30 and a profit of HK$75.72 million.
It claims to have a 5 per cent share of the mainland outdoor media market.
Tom.com hopes to complete the restructuring of its mainland subsidiaries later this year.
The restructuring needs approval from the Ministry of Foreign Trade and Economic Co-operation and the State Administration of Industry and Commerce.
Company sources said Tom.com planned to set up a joint venture with Kunming Fench Media to oversee the regional operations.
Starting this year, foreign companies can set up joint ventures in China and take a controlling stake. New companies are not required to pay income tax in the first two years of profitable operation.
With the new structure, Tom.com hopes to benefit from the taxation system and raise funds more easily to finance its outdoor media activities.
"We are looking forward to building a united brand name and a systematic structure in all the subsidiaries. We want to manage all our business over a single platform," Mr Xie said.
Tom.com denied media reports it was in talks with Thai recording company GMM Grammy to acquire its unprofitable Taiwan operation, GMM 8866.
"We confirm we have met but there has been no serious discussion and we don't have any plan or co-operation, as reported," a spokesman said.
GMM chairman Paiboon Damrongchaitham yesterday said it hoped to expand into the mainland market by forming a music venture with Tom.com. |
