SINA Reports Fourth Quarter 2012 Financial Results
SINA Reports Fourth Quarter 2012 Financial Results
PR Newswire
SHANGHAI, Feb. 19, 2013
SHANGHAI, Feb. 19, 2013 /PRNewswire/ -- SINA Corporation (NASDAQ GS: SINA), a
leading online media company serving China and the global Chinese communities,
today announced its unaudited financial results for the fourth quarter ended
December 31, 2012.
Fourth Quarter 2012 Highlights
o Net revenues increased 4% year over year to $139.1 million. Non-GAAP net
revenues increased 4% year over year to $134.4 million, within the
Company's guidance between $132.0 million and $136.0 million.
o Advertising revenues grew 7% year over year to $110.7 million, within the
Company's guidance between $110.0 million and $112.0 million.
o Non-advertising revenues decreased 4% year over year to $28.5 million.
Non-GAAP non-advertising revenues decreased 5% year over year to $23.8
million, reaching the high end of the Company's guidance between $22.0
million and $24.0 million.
o Net income attributable to SINA was $2.4 million, or $0.03 diluted net
income per share attributable to SINA. Non-GAAP net income attributable
to SINA was $9.0 million, or $0.13 non-GAAP diluted net income per share
attributable to SINA.
Fiscal 2012 Highlights
o Net revenues increased 10% year over year to $529.3 million. Non-GAAP net
revenues increased 10% year over year to $510.6 million.
o Advertising revenues grew 12% year over year to $412.9 million.
o Non-advertising revenues increased 2% year over year to $116.4 million.
Non-GAAP non-advertising revenues increased 2% year over year to $97.7
million.
o Net income attributable to SINA was $31.7 million, or $0.47 diluted net
income per share attributable to SINA. Non-GAAP net income attributable
to SINA was $10.4 million, or $0.15 non-GAAP diluted net income per share
attributable to SINA.
"2012 was a year of investment for SINA. We are delighted that Weibo
continued to gain popularity and Weibo monetization was off to a good start,"
said Charles Chao, CEO and Chairman of SINA. "In 2013, we will continue to
improve user experience and expand the scale of Weibo monetization, while turn
our focus to mobile Internet for all of our major product lines."
Fourth Quarter 2012 Financial Results
For the fourth quarter of 2012, SINA reported net revenues of $139.1 million,
compared to $133.4 million for the same period last year. Non-GAAP net
revenues for the fourth quarter of 2012 totaled $134.4 million, compared to
$128.7 million for the same period last year.
Online advertising revenues for the fourth quarter of 2012 were $110.7
million, compared to $103.7 million for the same period last year.
Non-advertising revenues for the fourth quarter of 2012 totaled $28.5
million, compared to $29.7 million for the same period last year. Mobile
value-added services ("MVAS") revenues for the fourth quarter of 2012
decreased 38% year over year to $13.2 million, while the rest of non-GAAP
non-advertising revenues grew 181% to $10.6 million, mainly from Weibo value
added services ("VAS"). As the market in China shifts towards mobile
Internet, the Company expects to further reallocate its resources away from
the low-margin MVAS business to Weibo VAS.
Gross margin for the fourth quarter of 2012 was 57%, compared to 54% for the
same period last year. Advertising gross margin for the fourth quarter of
2012 was 56%, the same as the corresponding period last year. Non-GAAP
advertising gross margin for the fourth quarter of 2012 was 57%, also the same
as last year. MVAS gross margin for the fourth quarter of 2012 was 45%,
compared to 35% for the same period last year, due to a shift in product mix.
Operating expenses for the fourth quarter of 2012 totaled $73.8 million,
compared to $66.7 million for the same period last year. Non-GAAP operating
expenses for the fourth quarter of 2012 were $69.0 million, compared to $62.3
million for the same period last year. The increase in non-GAAP operating
expenses was primarily due to higher personnel costs, lease expenses and
infrastructure spending, which were partially offset by lower marketing
expenditures.
Income from operations for the fourth quarter of 2012 was $5.6 million,
compared to $6.0 million for the same period last year. Non-GAAP income from
operations for the fourth quarter of 2012 was $6.4 million, compared to $6.7
million for the same period last year.
Non-operating loss from for the fourth quarter of 2012 was $2.1 million,
compared to a non-operating income of $3.8 million from the same period last
year. Non-operating loss in the fourth quarter of 2012 included $4.4 million
in losses from equity investments, or $0.4 million in losses on a non-GAAP
basis, which were accounted for under the equity-method accounting and
reported on a one-quarter lagging basis.
Net income attributable to SINA for the fourth quarter of 2012 was $2.4
million, compared to $9.3 million for the same period last year. Diluted net
income per share attributable to SINA for the fourth quarter of 2012 was
$0.03, compared to $ 0.14 for the same period last year. Non-GAAP net income
attributable to SINA for the fourth quarter of 2012 was $9.0 million, compared
to $14.0 million for the same period last year. Non-GAAP diluted net income
per share attributable to SINA for the fourth quarter of 2012 was $0.13,
compared to $0.21 for the same period last year.
As of December 31, 2012, SINA's cash, cash equivalents and short-term
investments totaled $713.6 million, compared to $673.5 million as of December
31, 2011. For the fourth quarter of 2012, cash provided by operating
activities was $33.5 million, capital expenditures totaled $17.9 million and
depreciation expenses amounted to $7.5 million.
Business Outlook
SINA estimates that its non-GAAP net revenues for the first quarter of 2013
will be between $115 million and $119 million, including advertising revenues
to be between $94 million and $96 million, and non-GAAP non-advertising
revenues to be between $21 million and $23 million. Non-GAAP net revenues and
non-GAAP non-advertising revenues exclude the recognition of $4.7 million in
deferred license revenues related to SINA's equity investment in E-House/CRIC.
Non-GAAP Measures
This release contains the following non-GAAP financial measures: non-GAAP net
revenues, non-GAAP non-advertising revenues, non-GAAP advertising gross
margin, non-GAAP gross profit, non-GAAP operating expenses, non-GAAP
income/(loss) from operations, non-GAAP equity earnings/(loss) from equity
investments, non-GAAP net income/(loss) attributable to SINA and non-GAAP
diluted net income/(loss) per share attributable to SINA. These non-GAAP
financial measures should be considered in addition to, not as a substitute
for, measures of the Company's financial performance prepared in accordance
with U.S. GAAP. The Company's non-GAAP financial measures may be defined
differently than similar terms used by other companies. Accordingly, care
should be exercised in understanding how the Company defines its non-GAAP
financial measures. Reconciliations of the Company's non-GAAP measures to the
nearest GAAP measures are set forth in the section below titled "Unaudited
Reconciliation of Non-GAAP to GAAP Results."
The Company's non-GAAP financial measures exclude certain items, including
share-based compensation, amortization of intangible assets, recognition of
deferred revenues and gain/loss resulting from the disposal, purchase or
impairment of a business, investment or non-controlling interest in a
subsidiary. The Company's management uses these non-GAAP financial measures
in their financial and operating decision-making, because management believes
these measures reflect the Company's ongoing business operations in a manner
that allows more meaningful period-to-period comparisons. The Company
believes that these non-GAAP financial measures provide useful information to
investors and others in the following ways: (i) in comparing the Company's
current financial results with the Company's past financial results in a
consistent manner, and (ii) in understanding and evaluating the Company's
current operating performance and future prospects in the same manner as
management does, if they so choose. The Company further believes the non-GAAP
financial measures provide useful information to both management and investors
by excluding certain expenses, gains/losses and other items (i) that are not
expected to result in future cash payments or (ii) that are non-recurring in
nature or may not be indicative of the Company's core operating results and
business outlook.
Use of non-GAAP financial measures has limitations. Our non-GAAP financial
measures do not include all income and expense items that affect the Company's
operations. They may not be comparable to non-GAAP financial measures used by
other companies. Management compensates for these limitations by also
considering the Company's financial results prepared in accordance with U.S.
GAAP.
Conference Call
SINA will host a conference call at 8 p.m. Eastern Standard Time on February
19, 2013 (or 9 a.m. Beijing Time on February 20, 2013) to present an overview
of the Company's financial performance and business operations. A live
webcast of the call will be available through the Company's corporate website
at http://corp.sina.com. The conference call can be accessed as follows:
US: +1 646 254 3515
Hong Kong: +852 3051 2745
Passcode for all regions: 94957366
A replay of the conference call will be available through midnight Eastern
Standard Time February 26, 2013. The dial-in number is +61 2 8199 0299. The
pass code for the replay is 94957366.
About SINA
SINA is an online media company serving China and the global Chinese
communities. Our digital media network of SINA.com (portal), SINA.cn (mobile
portal) and Weibo.com (social media) enable Internet users to access
professional media and user generated content in multi-media formats from the
web and mobile devices and share their interests with friends and
acquaintances.
SINA.com offers distinct and targeted professional content on each of its
region specific websites and a range of complementary offerings. SINA.cn
provides information and entertainment content from SINA portal customized for
WAP users. Based on an open-platform architecture to host organically
developed and third-party applications, Weibo.com is a form of social media,
featuring micro-blogging services and social networking services that allow
users to connect and share information anywhere, anytime and with anyone on
our platform.
Safe Harbor Statement
This press release contains forward-looking statements that relate to, among
other things, SINA's expected financial performance and SINA's strategic and
operational plans (as described, without limitation, in the "Business Outlook"
section and in quotations from management in this press release). SINA may
also make forward-looking statements in the Company's periodic reports to the
U.S. Securities and Exchange Commission, in its annual report to shareholders,
in press releases and other written materials and in oral statements made by
its officers, directors or employees to third parties. SINA assumes no
obligation to update the forward-looking statements in this press release and
elsewhere. Statements that are not historical facts, including statements
about the Company's beliefs and expectations, are forward-looking statements.
Forward-looking statements involve inherent risks and uncertainties. A number
of important factors could cause actual results to differ materially from
those contained in any forward-looking statement. Potential risks and
uncertainties include, but are not limited to: SINA's limited operating
history in certain new businesses; the current global financial and credit
market crisis and its impact on the Chinese economy; the uncertain regulatory
landscape in the People's Republic of China; fluctuations in the Company's
quarterly operating results; the Company's reliance on online advertising
sales and MVAS for a majority of its revenues; any failure to successfully
develop, introduce, drive adoption of or monetize new features and products,
including Weibo.com and MVAS products; the Company's reliance on mobile
operators in China to provide MVAS, changes in mobile operators' policies for
MVAS in China; any failure to successfully integrate acquired businesses;
risks associated with the Company's investments, including equity pick-up and
impairment; and any failure to compete successfully against new entrants and
established industry competitors. Further information regarding these and
other risks is included in SINA's annual report on Form 20-F for the year
ended December 31, 2011 and other filings with the Securities and Exchange
Commission.
Contact:
Investor Relations
SINA Corporation
Phone: 8610-82628888 x 3112
Email: ir@staff.sina.com.cn
SINA CORPORATION
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(U.S. Dollars in thousands, except per share data)
Three months ended Twelve months ended
December 31, September December 31,
30,
2012 2011 2012 2012 2011
Net revenues:
$ $ $ $ $
Advertising 368,805
110,666 103,655 120,590 412,928
Non-advertising 28,460 29,714 31,788 116,401 114,024
139,126 133,369 152,378 529,329 482,829
Cost of revenues:
Advertising (a) 48,758 45,635 54,010 195,324 157,458
Non-advertising 11,003 15,098 15,428 52,608 57,890
59,761 60,733 69,438 247,932 215,348
Gross profit 79,365 72,636 82,940 281,397 267,481
Operating expenses:
Sales and 34,688 36,013 38,439 142,342 135,867
marketing (a)
Product 28,508 21,464 28,392 108,062 65,533
development (a)
General and 10,580 9,088 12,308 39,397 30,121
administrative (a)
Goodwill - - 68,891
impairment
Amortization of 12 107 12 144 731
intangibles
73,788 66,672 79,151 289,945 301,143
Income/(loss) from 5,577 5,964 3,789 (8,548) (33,662)
operations
Non-operating income:
Interest and other 4,097 3,539 4,388 16,798 16,327
income, net
Earning/(loss) from
equity investments, (4,377) 225 883 (10,730) 1,466
net
Gain on sale of
/(impairment) on (1,770) - 3,004 37,065 (281,548)
investments,net
(2,050) 3,764 8,275 43,133 (263,755)
Income/(loss) before 3,527 9,728 12,064 34,585 (297,417)
income taxes
Provision for income (1,379) (713) (1,592) (2,730) (5,001)
taxes
Net income/(loss) 2,148 9,015 10,472 31,855 (302,418)
Less: Net
income/(loss)
attributable to (207) (264) 594 117 (326)
noncontrolling
interest
Net income/(loss) $ $ $ $ $
attributable to SINA
2,355 9,279 9,878 31,738 (302,092)
Basic net $ $ $ $ $
income/(loss) per
share attributable to 0.04 0.14 0.15 0.48 (4.64)
SINA
Diluted net $ $ $ $ $
income/(loss) per
share attributable to 0.03 0.14 0.14 0.47 (4.64)
SINA
Shares used in
computing basic
net income/(loss)
per share attributable 66,585 66,021 66,496 66,401 65,121
to SINA
Shares used in
computing diluted
net income/(loss)
per share attributable 66,930 66,767 66,874 66,849 65,121
to SINA
(a) Stock-based
compensation in each
category:
Cost of revenues - $ $ $ $ $
advertising
731 1,065 865 3,154 3,346
Sales and marketing 1,022 1,068 1,187 3,729 3,155
Product development 830 1,132 1,011 3,776 3,082
General and 2,953 2,030 3,267 8,699 7,024
administrative
SINA CORPORATION
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(U.S. Dollars in thousands)
December 31, December 31,
2012 2011
Assets
Current assets:
Cash and cash equivalents $ $
199,826 513,980
Short-term investments 513,772 159,495
Accounts receivable, net 135,251 112,469
Other current assets 36,498 41,966
Total current assets 885,347 827,910
Property and equipment, net 76,640 74,511
Goodwill and intangible assets, 15,840 15,974
net
Investments 466,875 463,938
Other assets 38,204 9,114
Total assets $ $
1,482,906 1,391,447
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable $ $
7,994 8,854
Accrued liabilities 205,569 174,972
Income taxes payable 13,466 14,717
Convertible debt - 2,200
Total current liabilities 227,029 200,743
Long-term deferred revenue 107,784 126,529
Other long-term liabilities 2,220 1,826
Total liabilities 337,033 329,098
Shareholders' equity
SINA shareholders' equity 1,136,670 1,055,670
Noncontrolling interest 9,203 6,679
Total shareholders' equity 1,145,873 1,062,349
Total liabilities and $ $
shareholders' equity 1,482,906 1,391,447
SINA CORPORATION
UNAUDITED SEGMENT INFORMATION
(U.S. Dollars in thousands)
Three months ended Twelve months ended
December 31, September 30, December 31,
2012 2011 2012 2012 2011
Net revenues
Advertising $ $ $ $ $
110,666 103,655 120,590 412,928 368,805
Mobile 13,243 21,281 19,079 69,008 83,457
related
Others 15,217 8,433 12,709 47,393 30,567
$ $ $ $ $
139,126 133,369 152,378 529,329 482,829
Cost of
revenues
Advertising $ $ $ $ # $
48,758 45,635 54,010 195,324 157,458
Mobile 7,218 13,783 12,262 41,935 53,235
related
Others 3,785 1,315 3,166 10,673 4,655
$ $ $ $ $
59,761 60,733 69,438 247,932 215,348
SINA CORPORATION
UNAUDITED RECONCILIATION OF NON-GAAP TO GAAP RESULTS
(U.S. Dollars in thousands, except per share data)
Three months ended
December 31, 2012 December 31, 2011 September 30, 2012
Non-GAAP Non-GAAP Non-GAAP
Actual Adjustments Results Actual Adjustments Results Actual Adjustments Results
Advertising $ $ $ $ $ $
revenues 110,666 110,666 103,655 103,655 120,590 120,590
Non-advertising 28,460 (4,686) (c) 23,774 29,714 (4,686) (c) 25,028 31,788 (4,687) (c) 27,101
revenues
Net revenues $ $ $ $ $ $ $ $ $
139,126 (4,686) 134,440 133,369 (4,686) 128,683 152,378 (4,687) 147,691
731 (a) 1,065 (a) 865 (a)
(4,686) (c) (4,686) (c) (4,687) (c)
Gross profit $ $ $ $ $ $ $ $ $
79,365 (3,955) 75,410 72,636 (3,621) 69,015 82,940 (3,822) 79,118
(4,805) (a) (4,230) (a) (5,465) (a)
(12) (b) (107) (b) (12) (b)
Operating $ $ $ $ $ $ $ $ $
expenses 73,788 (4,817) 68,971 66,672 (4,337) 62,335 79,151 (5,477) 73,674
5,536 (a) 5,295 (a) 6,330 (a)
12 (b) 107 (b) 12 (b)
(4,686) (c) (4,686) (c) (4,687) (c)
Income from $ $ $ $ $ $ $ $ $
operations 5,577 862 6,439 5,964 716 6,680 3,789 1,655 5,444
5,536 (a) 6,330 (a)
12 (b) 5,295 (a) 12 (b)
(4,686) (c) 107 (b) (4,687) (c)
4,002 (d) (4,686) (c) 3,138 (d)
1,770 (e) 3,958 (d) (3,004) (e)
Net income $ $ $ $ $ $ $ $ $
attributable to 2,355 6,634 8,989 9,279 4,674 13,953 9,878 1,789 11,667
SINA
Diluted net
income per $ $ $ $ $ $
share 0.03 0.13 0.14 0.21 0.14 0.17
attributable to
SINA
Shares used in
computing
diluted
net income
per share 66,930 - 66,930 66,767 - (g) 66,767 66,874 - 66,874
attributable to
SINA
Gross margin - 56% 1% 57% 56% 1% 57% 55% 1% 56%
advertising
Twelve months ended
December 31, 2012 December 31, 2011
Non-GAAP Non-GAAP
Actual Adjustments Results Actual Adjustments Results
Advertising $ $ $ $
revenues 412,928 412,928 368,805 368,805
Non-advertising 116,401 (18,745) (c) 97,656 114,024 (18,745) (c) 95,279
revenues
Net revenues $ $ $ $ $ $
529,329 (18,745) 510,584 482,829 (18,745) 464,084
3,154 (a) 3,346 (a)
(18,745) (c) (18,745) (c)
Gross profit $ $ $ $ $ $
281,397 (15,591) 265,806 267,481 (15,399) 252,082
(13,261) (a)
(16,204) (a) (731) (b)
(144) (b) (68,891) (f)
Operating $ $ $ $ $ $
expenses 289,945 (16,348) 273,597 301,143 (82,883) 218,260
16,607 (a)
19,358 (a) 731 (b)
144 (b) (18,745) (c)
(18,745) (c) 68,891 (f)
Income/(loss) $ $ $ $ $ $
from operations (8,548) 757 (7,791) (33,662) 67,484 33,822
16,607 (a)
19,358 (a) 731 (b)
144 (b) (18,745) (c)
(18,745) (c) 14,703 (d)
14,935 (d) 68,891 (f)
(37,065) (e) 281,548 (e)
Net
income/(loss) $ $ $ $ $ $
attributable to 31,738 (21,373) 10,365 (302,092) 363,735 61,643
SINA
Diluted net
income/(loss) $ $ $ $
per share 0.47 0.15 (4.64) 0.92
attributable to
SINA
Shares used in
computing
diluted
net
income/(loss)
per share 66,849 - 66,849 65,121 1,943 (g) 67,064
attributable to
SINA
Gross margin - 53% 0% * 53% 57% 1% 58%
advertising
(a) To adjust
stock-based compensation
related to employee
incentives.
(b) To adjust
amortization of
intangible
assets.
(c) To adjust the recognition of deferred revenue mostly
related to the license agreements resulting from the CRIC
Transaction.
(d) To adjust share of equity investments' GAAP to Non-GAAP reconciling
items, net of share of amortization of intangibles not on their books.
(e) To adjust gain on
sale of/(impairment) on
equity investments
(f) To adjust
for impairment
of MVAS
goodwill
(g) To adjust the number of shares used in
computing diluted net loss per share from diluted
net income per share.
* Rounding
UNAUDITED RECONCILIATION OF SINA'S SHARE OF EQUITY
INVESTMENTS' GAAP TO NON-GAAP RESULTS*
Three months ended
December 31, 2012 December 31, 2011 September 30, 2012
Actual Adjustments Non-GAAP Actual Adjustments Non-GAAP Actual Adjustments Non-GAAP
Results Results Results
To adjust $ $ $
stock-based 2,274 1,617 2,046
compensation
To adjust
amortization
expenses of
intangible
assets
resulting from 1,287 1,605 749
business
acquisitions
Earning/(loss)
from equity $ $ $ $ $ $ $ $ $
investments, (3,936) 3,561 (375) 961 3,222 4,183 1,226 2,795 4,021
net
Share of
amortization
of equity
investments'
intangibles $ $ $ $ $ $ $ $ $
not on their (441) 441 (736) 736 (343) 343
books - - -
$ $ $ $ $ $ $ $ $
(4,377) 4,002 (375) 225 3,958 4,183 883 3,138 4,021
Twelve months ended
December 31, 2012 December 31, 2011
Actual Adjustments Non-GAAP Actual Adjustments Non-GAAP
Results Results
To adjust $ $
stock-based 7,435 5,531
compensation
To adjust
amortization
expenses of
intangible
assets
resulting from $ 6,216
business 5,387
acquisitions
Earning/(loss)
from equity $ $ $ $ $ $
investments, (8,617) 12,822 4,205 4,422 11,747 16,169
net
Share of
amortization
of equity
investments'
intangibles $ $ $ $ $ $
not on their (2,113) 2,113 (2,956) 2,956
books - -
$ $ $ $ $ $
(10,730) 14,935 4,205 1,466 14,703 16,169
* Earning/(loss) from equity
investments is recorded one quarter
in arrears.
SOURCE SINA Corporation
Website: http://www.sina.com
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