Charm Communications Inc. Announces Unaudited Fourth Quarter and Full Year 2012 Results

  Charm Communications Inc. Announces Unaudited Fourth Quarter and Full Year
                                 2012 Results

Full year 2012 agency business revenues up 34.9% year over year, digital
revenues up 80% year over year

Full year 2012 agency business revenue extraction rate up to 6.5% from 5.4% in
2011

PR Newswire

BEIJING, March 18, 2013

BEIJING, March 18, 2013 /PRNewswire-FirstCall/ --Charm Communications Inc.
(NASDAQ: CHRM) ("Charm" or the "Company"), a leading advertising agency in
China, today announced its unaudited financial results for the fourth quarter
ended December 31, 2012.

Fourth Quarter 2012Highlights

  oTurnoverdeclined 20.9% year over year to $201.6 million in the fourth
    quarter of 2012
  oRevenuesdeclined 41.3% yearover year to $47.1 million in the fourth
    quarter of 2012
  oRevenues for Charm's advertising agency businessgrew 6.5% year over year
    to $12.5 million in the fourth quarter of 2012
  oRevenues for Charm's media investment management businessdeclined 51.2%
    year over year to $32.0 million in the fourth quarter of 2012
  oGross profitdeclined 54.4% year over year to $13.0 million in the fourth
    quarter of 2012
  oNet income declined 126.5% year over year to a net loss of $4.2 million in
    the fourth quarter of 2012
  oNon-GAAP net income, which excludes share-based compensation expenses,
    amortization of intangible assets and net change in fair value of
    consideration payable and call option, declined 122.0% year over year to a
    net loss of $3.8 million in the fourth quarter of 2012

Full Year 2012 Highlights

  oTurnoverdeclined 5.8% year over year to $823.9 million in the full year
    2012
  oRevenues declined 40.9% year over year to $165.5 million in the full year
    2012
  oRevenues for Charm's advertising agency business grew 34.9% year over year
    to $46.2 million in the full year 2012
  oRevenues for Charm's media investment management business declined 52.8%
    year over year to $112.8 million in the full year 2012
  oGross profit declined 42.8% year over year to $48.4 million in the full
    year 2012
  oNet income declined 105.2% year over year to a net loss of $2.5 million in
    the full year 2012
  oNon-GAAP net income, which excludes share-based compensation expenses,
    amortization of intangible assets and net change in fair value of
    consideration payable and call option, declined 99.1% year over year to a
    net loss of $0.5 million in the full year 2012

"2012 presented a more challenging operating environment than we encountered
in previous years, particularly with respect to our principal media business,
which was affected by regulatory changes in the satellite TV business as well
as by soft overall demand in the marketplace," said Mr. He Dang, Charm's
founder, chairman and chief executive officer. "At the same time, however, we
made excellent progress with our agency business, which continued to
outperform the market. Within that segment, our digital turnover grew 80% year
over year and we expect our digital business to continue to grow rapidly as we
consolidate Charm Interactive and Charm Click under the leadership of our vice
president, Johnny Zhu. Although we do expect current market softness to
continue in 2013, it will not hinder us in building Charm into a full-service,
integrated advertising company."

Mr. Wei Zhou, Charm's chief financial officer, added, "We delivered on our
revenue guidance due in large part to our strong agency business, and in terms
of gross billings, we remain in a healthy market position. However, our media
business margins did not ramp up as quickly as we had expected, primarily due
to the satellite TV operating environment. Additionally, our net income was
impacted by a bad debt provision. We will remain conservative with respect to
our media business going forward but will continue to invest in key talent and
assets to grow our overall business."

Fourth Quarter 2012Results

Turnover (non-GAAP)

US$ mm                         4Q12   4Q11   3Q12   Y-o-Y % Q-o-Q%
Total turnover (non-GAAP)      $201.6 $254.8 $216.5 -20.9%  -6.9%
Advertising agency             $169.6 $189.2 $182.5 -10.4%  -7.1%
Media investment management    $32.0  $65.6  $34.1  -51.2%  -6.0%
Branding and identity services N/A    N/A    N/A    N/A     N/A

The Company uses turnover (non-GAAP), defined as total customer advertising
spending placed through or with Charm, to reflect the scale of its business.

The 20.9% year-over-year decrease in total turnover was mainly due to the
decrease in the media investment business, which was a result of the Company
dropping several media assets at the beginning of 2012 to modify its media
inventory mix and to reduce risk following regulatory changes in the satellite
TV market. The 6.9% quarter-over-quarter decrease in turnover was largely
attributed to seasonal factors.

The 10.4% year-over-year and 7.1% quarter-over-quarter decrease in the
advertising agency business ("agency business") turnover was mainly due to the
decrease in advertising spending from existing agency clients who had
reallocated portions of their advertising budgets to the third quarter because
of the 2012 Summer Olympics.

The revenue extraction rate, which is defined as revenue divided by turnover,
was 7.4% for the agency business, compared to 6.2% for the fourth quarter of
2011 and 7.5% for the third quarter of 2012. The year-over-year increase was
mainly due to increased advertising spending on non-CCTV media platforms, such
as the Internet and satellite channels, all of which exhibited higher
extraction rates relative to those associated with CCTV. The slight
quarter-over-quarter decrease was due to Olympics-related spending in the
third quarter. The Company expects the revenue extraction rate to increase as
the Company expands its full-service offerings across all media platforms
under Charm Advertising and ramps up digital media offerings under Charm
Interactive and Charm Click.

The 51.2% year-over-year decrease in turnover (equivalent to GAAP revenue) for
the media investment management business ("principal media business"), which
operates under the Shangxing Media brand, was mainly due to a slowdown in the
broader economic environment and the dropping of several media assets at the
beginning of 2012 following the aforementioned regulatory changes. The 6.0%
quarter-over-quarter decrease in turnover in the principal media business was
mainly because of weaker demand from advertisers in the fourth quarter.

Revenues

US$ mm                         4Q12  4Q11  3Q12  Y-o-Y % Q-o-Q%
Total revenues                 $47.1 $80.3 $48.8 -41.3%  -3.5%
Advertising agency             $12.5 $11.7 $13.6 6.5%    -8.3%
Media investment management    $32.0 $65.6 $34.1 -51.2%  -6.0%
Branding and identity services $2.6  $3.0  $1.1  -13.5%  129.2%

The changes in agency and principal media business revenues are consistent
with the changes in turnover and the revenue extraction rate. The
quarter-over-quarter increase in branding and identity services was primarily
due to increased client demand for creative services in the fourth quarter of
2012, while the year-over-year decrease in branding and identity services was
primarily due to an overall decrease in client demand for creative services.

Gross Profit

US$ mm                                  4Q12  4Q11  3Q12  Y-o-Y % Q-o-Q%
Cost of revenues $34.1 $51.8 $34.5 -34.1%  -1.0%
Gross profit                            $13.0 $28.5 $14.4 -54.4%  -9.5%
Gross margin                            27.6% 35.5% 29.4%

Charm mainly attributes the year-over-year decrease in cost of revenues to the
dropping of several media assets in order to modify the Company's media
inventory mix following the aforementioned regulatory changes. The
year-over-year decline in gross profit was due to a lower contribution from
the principal media business. Cost of revenues was relatively flat quarter
over quarter, while the Company's gross profit decreased 9.5% quarter over
quarter as a result of lower revenues from the agency and media businesses.

Operating Profit (Loss)

US$ mm                             4Q12  4Q11  3Q12  Y-o-Y % Q-o-Q%
Total operating expenses $17.2 $13.0 $14.8 32.2%   16.0%
Selling and marketing              $11.3 $9.6  $9.4  17.0%   19.9%
General and administrative         $5.9  $3.4  $5.4  75.9%   9.2%
Operating profit (loss)            -$3.5 $15.5 -$0.2 -122.8% 1,738.9%

The 17.0% year-over-year increase and 19.9% quarter-over-quarter increase in
selling and marketing expenses were primarily due to increased headcount,
including executive hires within the Company's agency business.

The 75.9% year-over-year increase in general and administrative expenses was
mainly attributed to a bad debt provision of $2.7 million in the fourth
quarter of 2012.

Net Income (Loss)

US$ mm                                   4Q12   4Q11  3Q12   Y-o-Y % Q-o-Q%
Non-GAAP net income (loss)*              -$3.8  $17.1 $0.8   -122.0% -555.3%
Net income (loss)                        -$4.2  $15.7 $0.1   -126.5% -4,900.0%
Basic net income (loss) per ADS (US$)    -$0.13 $0.38 -$0.01
Fully diluted net income (loss) per ADS  -$0.13 $0.36 -$0.01
(US$)

*The Company's non-GAAP net income (loss) excludes share-based compensation
expenses, amortization of intangible assets and net change in fair value of
consideration payable and call option.

Each American depositary share ("ADS") represents two common shares. The
weighted average number of shares used to compute basic net loss per ADS for
the fourth quarter of 2012 was 38,269,369. As of December 31, 2012, 38,334,787
ADSs were issued and outstanding.

Cash Flows and Cash Position

Net cash flow from operations for the fourth quarter of 2012 was negative $1.1
million. As of December 31, 2012, the Company had cash and cash equivalents of
$116.6 million, compared to $117.9 million at the end of the third quarter of
2012.

Customers

In the fourth quarter of 2012, Charm's agency business had 174 advertisers,
compared to 167 advertisers in the third quarter of 2012 and 148 advertisers
in the fourth quarter of 2011.

In the fourth quarter of 2012, Charm's principal media business had 203
advertisers, compared to 231 advertisers in the third quarter of 2012 and 297
advertisers in the fourth quarter of 2011.

Employee Headcount

As of December 31, 2012, the Company had 813 employees, compared to 842
employees as of September 30, 2012.

Full Year 2012 Results

Turnover

US$ mm                         FY12   FY11   Y-o-Y %
Total turnover (non-GAAP)      $823.9 $874.5 -5.8%
Advertising agency             $711.1 $635.7 11.9%
Media investment management    $112.8 $238.8 -52.8%
Branding and identity services NA     NA     NA

Revenues

US$ mm                         FY12   FY11   Y-o-Y %
Total revenues                 $165.5 $280.1 -40.9%
Advertising agency             $46.2  $34.3  34.9%
Media investment management    $112.8 $238.8 -52.8%
Branding and identity services $6.5   $7.0   -7.7%

Gross Profit

US$ mm                                         FY12   FY11   Y-o-Y %
Cost of revenues $117.1 $195.6 -40.1%
Gross profit                                   $48.4  $84.5  -42.8%
Gross margin                                   29.2%  30.2%

Operating Profit (Loss)

US$ mm                                        FY12  FY11  Y-o-Y %
Total operating expenses $52.3 $36.8 41.9%
Selling and marketing                         $36.0 $27.1 32.8%
General and administrative                    $16.2 $9.7  67.3%
Operating profit (loss)                       -$3.2 $47.7 -106.8%

Net Income (Loss)

US$ mm                                        FY12   FY11  Y-o-Y %
Non-GAAP Net income*                          $0.5   $51.7 -99.1%
Net income (loss)                             -$2.5  $48.0 -105.2%
Basic net income (loss) per ADS (US$)         -$0.12 $1.18
Fully diluted net income (loss) per ADS (US$) -$0.12 $1.12

*The Company's non-GAAP net income (loss) excludes share-based compensation
expenses, amortization of intangible assets and net change in fair value of
consideration payable and call option.

Each ADS represents two common shares. The weighted average number of shares
used to compute basic net loss per ADS for the full year 2012 was 38,749,125.

Recent Business Developments

In February 2013, Mr. Johnny Honggang Zhu, the general manager of Charm Click,
was promoted to vice president of Charm to lead Charm Click and assume a new
role as head of Charm Interactive's business in northern China.

In the fourth quarter of 2012, Charm Advertising won the TV business for
Brilliance Auto, a large-scale automotive manufacturer in China, and Jian Nan
Chun, a leading maker of traditional Chinese wines.

In the fourth quarter of 2012, Charm Advertising again secured the number one
position in terms of successful bidding volume at the annual CCTV prime-time
auction, which was held on November 18, 2012. The total value of auctioned and
pre-sold advertising resources for CCTV hit an all time high of RMB15.88
billion, an increase of 11.4% compared to the previous year. Charm has held
the position of top bidder for ten straight years.

Business Outlook

US$ mm             1Q13E
Non-GAAP net loss* -$1.25 to -$0.75

*The Company's non-GAAP net income (loss) excludes share-based compensation
expenses, amortization of intangible assets and net change in fair value of
consideration payable and call option.

The Company bases these estimates on a foreign exchange rate of RMB6.30 to
US$1.00. This forecast reflects the Company's current and preliminary view,
which is subject to change.

Non-GAAP Financial Measures:

To supplement the unaudited condensed consolidated financial information
presented in accordance with Accounting Principles Generally Accepted in the
United States ("GAAP"), the Company also provides the following non-GAAP
financial measures: "turnover," which is defined as total customer advertising
spending placed through or with Charm, and "non-GAAP net income (loss)," which
is defined as GAAP net income (loss) excluding stock-based compensation
expenses, amortization of intangible assets and net change in fair value of
consideration payable and call option.

The non-GAAP financial measures are provided to enhance investors' overall
understanding of the Company's current and past financial performance in
ongoing core operations as well as prospects for the future. These measures
should be considered in addition to results prepared and presented in
accordance with GAAP, but should not be considered a substitute for, or
superior to, GAAP results. Management uses both GAAP and non-GAAP information
in evaluating and operating the Company's business internally and therefore
deems it important to provide all of this information to investors.

Cautions on Use of Non-GAAP Measures

In addition to Charm's consolidated financial results prepared under U.S.
GAAP, the Company also provides non-GAAP financial measures, including
"turnover" and "non-GAAP net income (loss)." The Company believes that the
non-GAAP financial measures provide investors with another method for
assessing its operating results in a manner that is focused on the performance
of its ongoing operations.

Management believes investors will benefit from greater transparency in
referring to these non-GAAP financial measures when assessing the Company's
operating results, as well as when forecasting and analyzing future periods.
However, management recognizes that:

  othese non-GAAP financial measures are limited in their usefulness and
    should be considered only as a supplement to the Company's GAAP financial
    measures;
  othese non-GAAP financial measures should not be considered in isolation
    from, or as a substitute for, the Company's GAAP financial measures;
  othese non-GAAP financial measures should not be considered to be superior
    to the Company's GAAP financial measures; and
  othese non-GAAP financial measures were not prepared in accordance with
    GAAP and investors should not assume that the non-GAAP financial measures
    presented in this earnings release were prepared under a comprehensive set
    of rules or principles.

Further, these non-GAAP financial measures may be unique to the Company, as
they may be different from non-GAAP financial measures used by other
companies. As such, this presentation of non-GAAP financial measures may not
enhance the comparability of the Company's results to the results of other
companies. Readers are cautioned not to view non-GAAP results on a stand-alone
basis or as a substitute for results under GAAP, or as being comparable to
results reported or forecasted by other companies.

A reconciliation of each non-GAAP financial measure to the most directly
comparable GAAP financial measure or measures appears at the end of this press
release.

Conference Call

Charm's management team will hold an earnings conference call at 8 a.m. U.S.
Eastern Time (8 p.m. Beijing/Hong Kong Time) on Tuesday, March 19, 2013.

Dial-in details for the conference call are as follows:

U.S.:  +1-718-354-1231
International:   +65-6723-9381
United Kingdom:         +44-20-3059-8139
Hong Kong:       +852-2475-0994
Passcode:      22022244

A replay of the call will be available from 11 a.m. March 19, 2013 until March
26, 2013 U.S. Eastern Time. Dial-in details for the replay are as follows:

International:  +61-2-8199-0299
Passcode:    22022244

Additionally, an archived webcast of this call will be available on the
Investor Relations section of the Charm web site at http:/ir.charmgroup.cn.

About Charm

Charm Communications Inc. (NASDAQ: CHRM) is a leading advertising agency group
in China that offers integrated advertising services with particular focus on
television and the internet. Charm's integrated advertising services include
full media planning and buying, as well as creative and branding services.
Charm has built a full service digital advertising platform, which offers
digital campaign capabilities across all key digital media, including search
engines, display portals, online video sites and social networking services.
Charm also secures advertising inventory and other advertising rights, such as
sponsorships and branded content, from premium media networks and resells to
clients as part of its integrated media offerings. Charm's clients include
China's top domestic brands, as well as some major international brands,
across a wide range of industries. Since 2003 Charm has been the top agency
every year for China's leading television network, China Central Television
(CCTV). For more information, please go tohttp://ir.charmgroup.cn.

Safe Harbor Statement

This press release contains "forward-looking statements" within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended, and as defined in the U.S.
Private Securities Litigation Reform Act of 1995. These forward-looking
statements can be identified by terminology such as "will," "expects,"
"anticipates," "future," "intends," "plans," "believes," "estimates" and
similar statements. All statements other than statements of historical fact in
this press release are forward-looking statements and involve certain risks
and uncertainties that could cause actual results to differ materially from
those in the forward-looking statements. These forward-looking statements are
based on management's current expectations, assumptions, estimates and
projections about the Company and the industry in which the Company operates,
but involve a number of unknown risks and uncertainties. Further information
regarding these and other risks is included in Charm's filings with the U.S.
Securities and Exchange Commission, including its registration statement on
Form F-1. The Company undertakes no obligation to update forward-looking
statements to reflect subsequent occurring events or circumstances, or changes
in its expectations, except as may be required by law. Although the Company
believes that the expectations expressed in these forward-looking statements
are reasonable, it cannot assure you that such expectations will turn out to
be correct, and actual results may differ materially from the anticipated
results. You are urged to consider these factors carefully in evaluating the
forward-looking statements contained herein and are cautioned not to place
undue reliance on such forward-looking statements, which are qualified in
their entirety by these cautionary statements.

For investor and media inquiries, please contact:

In China:

Ms. Jenny Wang
IR Department
Charm Communications Inc.
Phone: +86-10-8556-2527
Email:ir@charmgroup.cn

In the United States:

Ms. Jessica Barist Cohen
Ogilvy Financial, New York
Phone: +1-646-460-9989
Email:chrm@ogilvy.com 





Charm Communications Inc.
Unaudited Condensed Consolidated Balance Sheets

(Amounts in thousands of U.S. dollars)
                                                 31-Dec-12 30-Sep-12 31-Dec-11
ASSETS
Current Assets
 Cash and cash equivalents                       116,589   117,901   139,406
 Notes receivable                                6,993     13,084    28,880
 Prepaid expenses                                93,838    68,002    106,393
 Deposits                                        24,723    24,085    25,730
 Accounts receivable                             89,964    115,314   103,920
 Amount due from related parties                 1,938     3,000     3,494
 Deferred tax assets                             191       125       125
 Other current assets                            4,021     4,838     2,139
Total current assets                             338,257   346,349   410,087
 Fixed assets, net                               7,638     7,100     4,344
 Intangible assets, net                          2,375     2,616     3,397
 Investments under equity method                 2,133     1,491     1,445
 Goodwill                                        4,379     4,341     4,335
 Other investments                               803
 Other non-current assets                        3,045     1,721     1,009
Total non-current assets                         20,373    17,269    14,530
TOTAL ASSETS                                     358,630   363,618   424,617
LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST AND EQUITY
Current Liabilities
 Accounts payable (of which 53, 648 and 687, as
 of December 31,
 2012, September 30, 2012 and December 31,2011   38,855    46,061    63,141
 of the
 consolidated VIE without recourse to the
 Company, respectively)
 Amounts due to related parties (of which 313,
 310 and nil as of
 December 31, 2012, September 30, 2012 and       13,310    14,356    4,460
 December 31,2011 of
 the consolidated VIE without recourse to the
 Company, respectively)
 Advances from customers (of which 1,408, 1,666
 and 12,028 as of
 December 31, 2012, September 30, 2012 and       56,343    53,833    85,720
 December 31,2011 of
 the consolidated VIE without recourse to the
 Company, respectively)
 Accrued expenses and other current liabilities
 (of which 3,246,
 3,473 and 4,411 as of December 31, 2012,
 September 30, 2012 and                          18,912    14,548    22,876
 December 31,2011 of the consolidated VIE
 without recourse to the
 Company, respectively)
 Consideration payable (of which nil as of
 December 31, 2012,
 September 30, 2012 and December 31,2011 of the  2,507     2,817     2,813
 consolidated VIE
 without recourse to the Company, respectively)
Total current liabilities                        129,927   131,615   179,010
 Consideration payable (of which nil as of
 December 31, 2012,
 September 30, 2012 and December 31, 2011 of the 1,327     2,479     2,476
 consolidated VIE
 without recourse to the Company, respectively)
Total non-current liabilities                    1,327     2,479     2,476
Total liabilities                                131,254   134,094   181,486
Redeemable noncontrolling interest               5,434     5,137     4,723
Equity:
Charm Communications Inc.'s equity
 Ordinary shares                                 8         8         8
 Additional paid-in capital                      100,850   100,782   116,637
 Retained earnings                               101,225   106,285   105,930
 Accumulated other comprehensive income          15,652    13,695    13,384
Total Charm Communications Inc. shareholders'    217,735   220,770   235,959
equity
Noncontrolling interest                          4,207     3,617     2,449
Total equity                                     221,942   224,387   238,408
TOTAL LIABILITIES, REDEEMABLE NONCONTROLLING
INTEREST AND EQUITY                              358,630   363,618   424,617





Charm Communications Inc.
Condensed Consolidated Statements of Operations
(Amounts in thousands of U.S. dollars, except for number of shares and per
share data)
                                          For the three months ended,
                                          December31 December31 September30
                                          2012        2011        2012
                                          (Unaudited) (Unaudited) (Unaudited)
Revenues:
       Media investment management        32,042      65,618      34,073
       Advertising agency                 12,512      11,745      13,646
       Branding and identity services     2,578       2,979       1,125
Total revenues                            47,132      80,342      48,844
Cost of revenues:
       Media investment management        31,159      48,861      32,301
       Advertising agency                 1,337       1,207       1,371
       Branding and identity services     1,624       1,739       796
Total cost of revenues:                   34,120      51,807      34,468
Gross profit                              13,012      28,535      14,376
Operating expenses:
       Selling and marketing expenses     11,286      9,643       9,413
       General and administrative         5,891       3,350       5,393
       expenses
Total operating expenses                  17,177      12,993      14,806
       Gain(Loss) from equity method      307         (5)         237
       investees
       Net change in fair value of
       consideration payable and call     309         -           -
       option
Operating profit (loss)                   (3,549)     15,537      (193)
       Interest income                    568         663         472
Income before income tax expense          (2,981)     16,200      279
       Income tax expense                 1,195       465         192
Net income (loss)                         (4,176)     15,735      87
Net income attributable to                884         944         597
noncontrolling interest
Net income (loss) attributable to Charm   (5,060)     14,791      (510)
Communications Inc.
Net income(loss) attributable to Charm
Communications Inc. shareholders per
ADS:
Basic                                     (0.13)      0.38        (0.01)
Diluted                                   (0.13)      0.36        (0.01)
Shares used in computation of net
income(loss) per ADS:
Basic                                     38,269,369  39,075,906  38,765,702
Diluted                                   38,269,369  40,976,069  38,765,702
Notes:
Share-based compensation expenses during
the period included in:
Cost of revenues                          -           1           -
Selling and marketing expenses            318         571         323
General and administrative expenses       150         303         156
Total                                     468         875         479
                                          For the three months ended,
                                          December 31 December 31 September 30
                                          2012        2011        2012
                                          (Unaudited) (Unaudited) (Unaudited)
Net income (loss)                         (4,176)     15,735      87
Other comprehensive income (loss):
Change in cumulative foreign exchange     1,957       2,938       2,404
translation adjustment
Comprehensive income (loss)               (2,219)     18,673      2,491
Less: Comprehensive income attributable   (590)       (754)       (688)
to non-controlling interest
Less: Comprehensive income attributable   (297)       (190)       (146)
to redeemable non-controlling interest
Comprehensive income (loss) attributable  (3,106)     17,729      1,657
to Charm Communications Inc.





Charm Communications Inc.

Condensed Consolidated Statements of Operations

(Amounts in thousands of U.S. dollars, except for number of shares and per
share data)
                                           For the twelve months ended,
                                           December 31, 2012 December 31, 2011
                                           (Unaudited)       (Audited)
Revenues:
         Media investment management       112,786           238,837
         Advertising agency                46,234            34,285
         Branding and identity services    6,478             7,016
Total revenues                             165,498           280,138
Cost of revenues:
         Media investment management       107,976           187,878
         Advertising agency                4,864             3,737
         Branding and identity services    4,303             4,015
Total cost of revenues:                    117,143           195,630
Gross profit                               48,355            84,508
Operating expenses:
         Selling and marketing expenses    36,026            27,119
         General and administrative        16,234            9,704
         expenses
Total operating expenses                   52,260            36,823
         Gain(Loss) from equity method     350               2
         investees
         Net change in fair value of
         consideration payable and call    309
         option
Operating profit (loss)                    (3,246)           47,687
         Interest income                   2,255             2,497
         Other expense                     13                -
Income (loss) before income tax expense    (1,004)           50,184
         Income tax expense                1,472             2,158
Net income (loss)                          (2,476)           48,026
Net income attributable to noncontrolling  2,229             1,879
interest
Net income (loss) attributable to Charm    (4,705)           46,147
Communications Inc.
Net income(loss) attributable to Charm
Communications Inc. shareholders per ADS:
Basic                                      (0.12)            1.18
Diluted                                    (0.12)            1.12
Shares used in computation of net
income(loss) per ADS:
Basic                                      38,749,125        39,133,419
Diluted                                    38,749,125        41,056,882
Notes:
(1) Share-based compensation expenses
during the period included in:
Cost of revenues                           1                 4
Selling and marketing expenses             1,506             1,979
General and administrative expenses        707               1,086
Total                                      2,214             3,069
                                           For the twelve months ended,
                                           December 31, 2012 December 31, 2011
                                           (Unaudited)       (Audited)
Net income (loss)                          (2,476)           48,026
Other comprehensive income (loss):
Change in cumulative foreign exchange      2,268             9,065
translation adjustment
Comprehensive income (loss)                (208)             57,091
Less: Comprehensive income attributable    (1,758)           (1,572)
to non-controlling interest
Less: Comprehensive income attributable to (711)             (4,723)
redeemable non-controlling interest
Comprehensive income (loss) attributable   (2,677)           50,796
to Charm Communications Inc.





Reconciliation from Net income (loss) to Non-GAAP net income (loss):
(Amounts in thousands of U.S. dollars)
                                     For the three months ended,
                                     December 31    December 31   September30
                                     2012           2011          2012
Net income (loss)                    (4,176)        15,735        87
Add back share-based compensation
expenses
during the related periods           468            875           479
Add back amortization on intangible  261            443           259
assets
Deduct net change in fair value of
consideration payable and call       (309)
option
Non-GAAP net income (loss)           (3,756)        17,053        825
                                     For the twelve months ended,
                                     December 31,   December 31,
                                     2012           2011
Net income (loss)                    (2,476)        48,026
Add back share-based compensation
expenses
during the related periods           2,214          3,069
Add back amortization on intangible  1,041          650
assets
Deduct net change in fair value of
consideration payable and call       (309)
option
Non-GAAP net income                  470            51,745


Reconciliation from Turnover (non-GAAP) to USGAAP Revenues:
(Amounts in thousands of U.S. dollars)
                                     For the three months ended,
                                     December 31    December 31   September 30
                                     2012           2011          2012
Turnover (non-GAAP):
Media investment management          32,042         65,618        34,073
Advertising agency                   169,570        189,178       182,457
Branding and identity services       N/A            N/A           N/A
Total turnover                       201,612        254,796       216,530
Extracted rate:
Media investment management          100.0%         100.0%        100.0%
Advertising agency                   7.4%           6.2%          7.5%
Branding and identity services       N/A            N/A           N/A
USGAAP Revenue:
Media investment management          32,042         65,618        34,073
Advertising agency                   12,512         11,745        13,646
Branding and identity services       2,578          2,979         1,125
Total revenue                        47,132         80,342        48,844
                                     For the twelve months ended,
                                     December 31,   December 31,
                                     2012           2011
Turnover (non-GAAP):
Media investment management          112,786        238,837
Advertising agency                   711,093        635,654
Branding and identity services       N/A            N/A
Total turnover                       823,879        874,491
Extracted rate:
Media investment management          100.0%         100.0%
Advertising agency                   6.5%           5.4%
Branding and identity services       N/A            N/A
USGAAP Revenue:
Media investment management          112,786        238,837
Advertising agency                   46,234         34,285
Branding and identity services       6,478          7,016
Total revenue                        165,498        280,138

SOURCE Charm Communications Inc.

Website: http://ir.charmgroup.cn