** CHINA ($11.50-$12.50) Achieves 103% Y-o-Y Revenue Growth and First Full Year of US GAAP Profitability
Thursday February 26, 4:30 pm ET
chinadotcom's Full Year 2003 vs. 2002 Highlights:
- Revenues increased 103% to US$89.4 million, compared to US$44.0 million in 2002
- Gross profit increased 154% to US$41.3 million, compared to US$16.2 million in 2002
- Gross margin increased to 46% from 37% in 2002
- Net profit of US$15.5 million in 2003, compared to a net loss of US$18.2 million in 2002
chinadotcom's Q4 vs. Q3 Results Highlights:
- Revenues rose 20% to US$29.3 million, compared to US$24.4 million in Q3
- Gross profits increased 27% to US$15.0 million from US$11.8 million in Q3
- Gross margin increased to 51% from 48% in Q3
- Operating cash earnings* rose 48% to US$3.7 million from US$2.5 million in Q3
Recent Highlights:
- The company completed the acquisition of Pivotal Corporation, a NASDAQ-listed customer relationship management ("CRM") software company.
- The company continued to make progress on its acquisition of Ross Systems Inc. ("Ross"), a NASDAQ-listed enterprise resource planning ("ERP") software company. The merger agreement was amended to increase certainty for closing of the transaction, removed the pricing "collar" to better ensure that Ross' shareholders receive US$19 per share in value and added an all cash option of US$17 per share together with the US$19 per share cash/stock offer. The latest version of the related registration statement/proxy filing was submitted to the US SEC on February 11, 2004.
- The company reorganized its mobile and portal unit as a wholly owned subsidiary, chinadotcom Mobile Interactive Corporation ("CDC Mobile").
HONG KONG, Feb. 26 /PRNewswire-FirstCall/ -- chinadotcom corporation (Nasdaq: CHINA; www.corp.china.com), a leading integrated enterprise software and mobile applications company in China and internationally, today announced its financial results for the fourth quarter and full year ending December 31, 2003 under US GAAP. 2003 revenues from continuing operations including from acquired entities were US$89.4 million as compared to US$44.0 million in 2002, an increase of 103%. Gross profit in 2003 increased by 154% to US$41.3 million as compared to US$16.2 million in 2002. Gross margin in 2003 was 46% as compared to 37% in 2002. Operating cash earnings in 2003 were US$7.3 million as compared to a loss of US$10.6 million in 2002. Net profit in 2003 was US$15.5 million as compared to a net loss in 2002 of US$18.2 million. 2003 overall earnings per share was US$0.15 as compared to a loss per share of US$0.18 in 2002.
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Q4 2003 revenues from continuing operations rose by 20% to US$29.3 million from US$24.4 million in Q3 2003. For Q4 2003, gross profit in Q4 2003 was US$15.0 million, up 27% from US$11.8 million in Q3 2003 and gross margin was 51%, up from 48% in Q3 2003. Operating cash earnings (defined as gross profit minus selling, general and administrative expenses) rose 48% to US$3.7 million in Q4 2003 from US$2.5 million in Q3 2003. As a result of the new acquisitions in 2003, additional employment compensation expense of US$1.2 million and amortization of intangible assets of US$2.3 million were recorded in Q4 2003, resulting in a 71% decrease in operating income to US$0.5 million as compared to US$1.7 million in Q3 2003. As a result, net earnings in Q4 2003 were US$4.0 million, down 34% compared to Q3, and earnings per share decreased quarter over quarter from US$0.06 in Q3 2003 to US$0.04 in Q4 2003.
Adjusting on a quarterly basis through 2003 for the employment compensation expense and intangible asset amortization from new acquisitions, and excluding the proceeds from the disposal of treasury instruments and other adjustments, recurrent operating profit from continuing operations in Q4 2003 would have increased 94% to US$2.2 million, up from US$1.1 million in Q3 2003. Reflecting these adjustments, net income from continuing operations would have risen 10% to US$4.1 million in Q4 2003, up from US$3.8 million in Q3 2003.
"This quarter we posted our fifth consecutive US GAAP profit, which reflects improvement in the guided financial metrics of revenues, gross margins and operating cash flows, and the efficiencies gained through the successful integration of our recent acquisitions," said Chief Financial Officer Daniel Widdicombe. "We will continue executing on those acquisitions that can deliver sustainable high-margin and recurrent revenues while enabling us to achieve our growth strategy in China and internationally."
The company's balance sheet at December 31, 2003 showed net cash and cash equivalents of US$342 million and 101.6 million common shares outstanding. |
