AirMedia Announces Unaudited Second Quarter 2013 Financial Results

      AirMedia Announces Unaudited Second Quarter 2013 Financial Results

PR Newswire

BEIJING, Aug. 13, 2013

BEIJING, Aug. 13, 2013 /PRNewswire/ -- AirMedia Group Inc. ("AirMedia" or the
"Company") (Nasdaq: AMCN), a leading operator of out-of-home advertising
platforms in China targeting mid-to-high-end consumers, today announced its
unaudited financial results for the second quarter ended June 30, 2013.

Second Quarter 2013 Financial and Business Highlights

  oTotal revenues decreased by 5.6% year-over-year to US$64.3 million, which
    remained relatively unchanged from the previous quarter. The
    year-over-year decrease was partially due to AirMedia's termination of
    operations of certain unprofitable or low-margin contracts and China's
    replacement of regular business tax with Value Added Tax ("VAT") in
    Beijing, one of AirMedia's key regions of operations.
  oNet revenues decreased by 4.8% year-over-year to US$63.4 million, which
    remained relatively unchanged from the previous quarter.
  oNet loss attributable to AirMedia's shareholders was US$4.9 million,
    compared to net loss attributable to AirMedia's shareholders of US$1.5
    million in the same period one year ago. Basic and diluted net loss
    attributable to AirMedia's shareholders per American Depositary Share
    ("ADS") were both US$0.08.
  oAdjusted net loss attributable to AirMedia's shareholders (non-GAAP),
    which is net loss attributable to AirMedia's shareholders excluding
    share-based compensation expenses, amortization of acquired intangible
    assets, impairment of goodwill and impairment of intangible assets, was
    US$4.5 million. Adjusted basic net loss attributable to AirMedia's
    shareholders per ADS (non-GAAP), which is adjusted net loss attributable
    to AirMedia's shareholders (non-GAAP) divided by the number of ADSs
    outstanding, was US$0.07. Adjusted diluted net loss attributable to
    AirMedia's shareholders per ADS (non-GAAP), which is adjusted net loss
    attributable to AirMedia's shareholders (non-GAAP) divided by the number
    of ADSs outstanding as adjusted for dilution after taking into account
    option grants under the Company's current Share Incentive Plan, was
    US$0.07.

"We faced a challenging advertising environment in the second quarter of 2013;
automobile and finance, our top two advertising categories, declined
year-over-year due to the slow-down of China's economic growth and reduced
conspicuous consumption in China, and high-end food and beverages, our third
most popular advertising category, also saw a quarter-over-quarter decline in
the second quarter after a strong first quarter," commented Mr. Herman Guo,
chairman and chief executive officer of AirMedia. "Advertisers are now more
cautious in their advertising spending and tend to shift budgets to the
advertising platforms which they trust and believe are effective. We are happy
to see that our digital frames, which included mega-size LED screens,
continued to grow 14.9% year-over-year and 1.7% quarter-over-quarter. We now
operate mega-size LED screens in 9 airports, compared with 7 airports in the
middle of May 2013."

"To cope with the harsh advertising environment, we are focusing on increasing
our profitability by building a nationwide network of mega-size LED screens,
not renewing our unprofitable or low-margin concession rights contracts, and
turning around our unprofitable product lines," Mr. Guo continued. "We have
not renewed several relatively large contracts, which were unprofitable or
low-margin, since the end of last year, which partially contributed to our
year-over-year revenue decreases in the recent quarters."

"As for the unprofitable product lines, we recently extended our concession
rights contract with China Petroleum & Chemical Corporation ("Sinopec"), and
received approval from Sinopec to install LED screens in its gas stations. We
expect to see a significant increase in revenues from our gas station media
network after we reach our initial target of operating 1,000 LED screens in
gas stations," Mr. Guo further remarked. "In addition, we are doing some
research and testing for interactive media format on our TV-attached digital
frames, in order to attract a larger portion of our advertisers' budgets."

"We believe that our strong cash balance is a solid foundation for the Company
to get through this difficult time, and that we are on the right track in
cutting loss and turning around the Company," Commented Mr. Henry Ho, chief
financial officer of AirMedia.

Second Quarter 2013 Financial Results

Revenues

Total revenues by product line (numbers in US$ 000's except for percentages):

             Quarter           Quarter           Quarter
             Ended   % of      Ended   % of      Ended   % of      Y/Y     Q/Q
             June    Total     March   Total     June    Total     Growth  Growth
             30,     Revenues  31,     Revenues  30,     Revenues  rate    rate
             2013              2013              2012
Air Travel
Media        60,712  94.3%     60,532  93.8%     63,046  92.5%     -3.7%   0.3%
Network
 Digital
frames in    34,078  53.0%     33,516  51.9%     29,652  43.5%     14.9%   1.7%
airports
 Digital
TV screens   2,651   4.1%      2,752   4.3%      3,414   5.0%      -22.3%  -3.7%
in airports
 Digital
TV screens   3,325   5.2%      3,788   5.9%      7,143   10.5%     -53.5%  -12.2%
on
airplanes

Traditional  18,459  28.7%     18,932  29.3%     20,764  30.5%     -11.1%  -2.5%
media in
airports
 Other
revenues in  2,199   3.3%      1,544   2.4%      2,073   3.0%      6.1%    42.4%
air travel
Gas Station
Media        2,236   3.5%      2,789   4.3%      2,278   3.4%      -1.8%   -19.8%
Network
Other Media  1,397   2.2%      1,226   1.9%      2,809   4.1%      -50.3%  13.9%
Total        64,345  100.0%    64,547  100.0%    68,133  100.0%    -5.6%   -0.3%
revenues
Net          63,373            63,612            66,583            -4.8%   -0.4%
revenues

Total revenues for the second quarter of 2013 reached US$64.3 million,
representing a year-over-year decrease of 5.6% from US$68.1 million in the
same period one year ago and remaining relatively unchanged from the previous
quarter. The year-over-year decrease was primarily due to decreases in
revenues from most product lines other than digital frames in airports and
also partially due to AirMedia's termination of the operations of certain
unprofitable or low-margin contracts as well as China's replacement of regular
business tax with VAT in Beijing, one of AirMedia's key regions of operations.

Revenues from digital frames in airports

Revenues from digital frames in airports for the second quarter of 2013
increased by 14.9% year-over-year and by 1.7% quarter-over-quarter to US$34.1
million. The year-over-year and quarter-over-quarter increases were primarily
due to additional revenues from the rapidly growing product line of mega-size
LED screens, which added operations in additional airports.

Revenues from digital TV screens in airports

Revenues from digital TV screens in airports for the second quarter of 2013
decreased by 22.3% year-over-year and by 3.7% quarter-over-quarter to US$2.7
million. The year-over-year decrease was primarily due to a drop in demand.
The quarter-over-quarter decrease was primarily due to a challenging
advertising environment in the second quarter of 2013 caused in part by a
slow-down of China's economic growth and reduced conspicuous consumption in
China.

Revenues from digital TV screens on airplanes

Revenues from digital TV screens on airplanes for the second quarter of 2013
decreased by 53.5% year-over-year and by 12.2% quarter-over-quarter to US$3.3
million. The year-over-year decrease was primarily due to the decrease in
revenues of digital TV screens on Air China's airplanes as AirMedia chose not
to renew the concession rights contract with Air China, as well as a
challenging advertising environment in the second quarter of 2013. The
quarter-over-quarter decrease was primarily due to a challenging advertising
environment in the second quarter of 2013.

Revenues from traditional media in airports

Revenues from traditional media in airports for the second quarter of 2013
decreased by 11.1% year-over-year and by 2.5% quarter-over-quarter to US$18.5
million. The year-over-year decrease was primarily due to AirMedia's
termination of certain unprofitable or low-margin contracts and a challenging
advertising environment in the second quarter of 2013. AirMedia chose not to
renew the concession rights contract of most of AirMedia's traditional media
in Shenzhen Baoan International Airport at the end of 2012 and the billboards
and painted advertisements on the interior of the gate bridges of Terminal 3
in Beijing Capital International Airport ("Beijing Airport") in the middle of
May 2013 after the expiration of the relevant contracts. The
quarter-over-quarter decrease was primarily due to the expiration of the
concession rights contract for the billboards and painted advertisements on
the interior of the gate bridges of Terminal 3 of Beijing Airport.

Revenues from the gas station media network

Revenues from the gas station media network for the second quarter of 2013
decreased by 1.8% year-over-year and by 19.8% quarter-over-quarter to US$2.2
million. The year-over-year decrease was primarily due to the fact that some
advertisers expressed interest in reserving their budgets for the LED screens
that AirMedia plans to install in its gas stations, as well as China's
replacement of regular business tax with VAT in Beijing. The
quarter-over-quarter decrease was primarily due to the fact that some
advertisers expressed interest in reserving their budgets for the LED screens
that AirMedia plans to install in its gas stations.

Revenues from other media

Revenues from other media were primarily revenues from unipole signs and other
outdoors media. Revenues from other media for the second quarter of 2013
decreased by 50.3% year-over-year and increased by 13.9% quarter-over-quarter
to US$1.4 million. The year-over-year decrease was primarily due to expiration
of the contracts for some locations in November and December 2012. The
quarter-over-quarter increase was due to the fact that AirMedia renewed some
of these contracts and resumed operations of these locations in February 2013,
which had a full quarter operation in the second quarter of 2013.

Business tax and other sales tax

Business tax and other sales tax for the second quarter of 2013 were
US$972,000, compared to US$1.6 million in the same period one year ago and
US$935,000 in the previous quarter. The year-over-year decrease was due to
China's replacement of regular business tax with the VAT in Beijing, one of
AirMedia's key regions of operations. Prior to September 1, 2012, revenues
were recorded gross of business tax and subsequent to the change, revenues are
recorded net of VAT thereafter. Revenues from most of the Company's product
lines booked in total revenues were already net revenues after deducting VAT
in the second quarter of 2013. The majority of the Company's business tax and
other sales tax, amounting to US$972,000 in the second quarter of 2013, were
other sales tax.

Net revenues

Net revenues for the second quarter of 2013 reached US$63.4 million,
representing a year-over-year decrease of 4.8% from US$66.6 million in the
same period one year ago and a quarter-over-quarter decrease of 0.4% from
US$63.6 million in the previous quarter.

Cost of Revenues

Cost of revenues for the second quarter of 2013 was US$60.1 million,
representing a year-over-year increase of 0.4% from 59.8 million in the same
period one year ago and a quarter-over-quarter decrease of 0.1% from US$60.1
million in the previous quarter. The year-over-year increase was primarily due
to higher concession fees, which were partially offset by lower agency fees
for third-party advertising agencies. There was a partial reversal of certain
previously accrued agency fees of US$1.5 million in the second of 2013 that
were waived by the related agents. Cost of revenues as a percentage of net
revenues in the second quarter of 2013 was 94.8%, up from 89.9% in the same
period one year ago and up from 94.5% in the previous quarter.

AirMedia incurs concession fees to airports for placing and operating digital
frames, digital TV screens, traditional media and other displays in airports,
to airlines for playing programs on their digital TV screens, to Sinopec for
placing outdoors media in its gas stations and to other media resources owners
for placing unipole signs and other outdoors media.

Concession fees for the second quarter of 2013 increased by 3.3%
year-over-year and by 0.6% quarter-over-quarter to US$46.4 million. The
year-over-year and quarter-over-quarter increases were primarily due to newly
signed or renewed concession rights contracts during the period. Concession
fees as a percentage of net revenues in the second quarter of 2013 was 73.2%,
increasing from 67.5% in the same period one year ago and from 72.6% in the
previous quarter. The year-over-year and quarter-over-quarter increases of
concession fees as a percentage of net revenues were primarily due to the fact
that net revenues decreased while concession fees increased because of newly
signed or renewed concession rights contracts.

Gross Profit

Gross profit for the second quarter of 2013 decreased by 51.2% year-over-year
and by 5.6% quarter-over-quarter to US$3.3 million.

Gross profit as a percentage of net revenues for the second quarter of 2013
was 5.2%, compared to 10.1% in the same period one year ago and 5.5% in the
previous quarter. The year-over-year and quarter-over-quarter decreases in
gross profit as a percentage of net revenues were primarily due to the
decreases in net revenues.

Operating Expenses

Operating expenses (numbers in US$ 000's except for percentages):

               Quarter           Quarter           Quarter
               Ended   % of Net  Ended   % of Net  Ended   % of Net  Y/Y    Q/Q
               June    Revenues  March   Revenues  June    Revenues  Growth Growth
               30,               31,               30,               rate   rate
               2013              2013              2012
Selling and
marketing      4,782   7.5%      4,222   6.6%      4,162   6.3%      14.9%  13.3%
expenses
General and
administrative 5,468   8.6%      4,878   7.7%      5,056   7.6%      8.1%   12.1%
expenses
Total
operating      10,250  16.1%     9,100   14.3%     9,218   13.9%     11.2%  12.6%
expenses
Adjusted
operating      9,776   15.4%     8,625   13.6%     7,409   11.1%     31.9%  13.3%
expenses
(non-GAAP)

Total operating expenses for the second quarter of 2013 were US$10.3 million,
representing a year-over-year increase of 11.2% from US$9.2 million in the
same period one year ago and a quarter-over-quarter increase of 12.6% from
US$9.1 million in the previous quarter.

Share-based compensation expenses included in the total operating expenses for
the second quarter of 2013 were US$277,000, compared to share-based
compensation expenses of US$993,000 in the same period one year ago and
share-based compensation expenses of US$280,000 in the previous quarter. The
year-over-year decrease in share-based compensation expenses was primarily due
to the ending of the vesting period of stock options granted on July 10, 2009.

Adjusted operating expenses (non-GAAP), which excluded share-based
compensation expenses, amortization of acquired intangible assets, impairment
of goodwill, and impairment of intangible assets, were US$9.8 million for the
second quarter of 2013, representing a year-over-year increase of 31.9% from
US$7.4 million in the same period one year ago and a quarter-over-quarter
increase of 13.3% from US$8.6 million in the previous quarter. Adjusted
operating expenses as a percentage of net revenues (non-GAAP), which is
calculated by dividing adjusted operating expenses (non-GAAP) by net revenues,
was 15.4% in the second quarter of 2013, compared to 11.1% in the same period
one year ago and 13.6% in the previous quarter.

Please refer to the attached table captioned "Reconciliation of GAAP Operating
Expenses to Non-GAAP Adjusted Operating Expenses" for a reconciliation of
operating expenses under U.S. GAAP to adjusted operating expenses (non-GAAP).

Selling and marketing expenses for the second quarter of 2013 were US$4.8
million. This represented a year-over-year increase of 14.9% from US$4.2
million and a quarter-over-quarter increase of 13.3% from US$4.2 million. The
year-over-year and quarter-over-quarter increases were primarily due to higher
expenses related to the Company's direct sales force.

General and administrative expenses for the second quarter of 2013 were US$5.5
million, including share-based compensation expenses of US$277,000. This
represented a year-over-year increase of 8.1% from US$5.1 million in the same
period one year ago and a quarter-over-quarter increase of 12.1% from US$4.9
million in the previous quarter. The year-over-year increase was primarily due
to higher salary expenses and higher bad-debt provisions. The
quarter-over-quarter increase was primarily due to higher salary expenses and
higher professional fees.

Loss/Income  from Operations

Loss from operations for the second quarter of 2013 was US$7.0 million,
compared to loss from operations of US$2.5 million in the same period one year
ago and loss from operations of US$5.6 million in the previous quarter. Loss
from operations as a percentage of net revenues for the second quarter of 2013
was negative 11.0%, compared to negative 3.7% in the same period one year ago
and negative 8.8% in the previous quarter.

Adjusted loss from operations (non-GAAP), which excluded share-based
compensation expenses, amortization of acquired intangible assets, impairment
of goodwill and impairment of intangible assets, was US$6.5 million for the
second quarter of 2013, compared to adjusted loss from operations (non-GAAP)
of US$657,000 in the same period one year ago and adjusted loss from
operations (non-GAAP) of US$5.1 million in the previous quarter. Adjusted
operating margin (non-GAAP), which excluded the effect of share-based
compensation expenses, amortization of acquired intangible assets, impairment
of goodwill, and impairment of intangible assets, was negative 10.2% for the
second quarter of 2013, compared to negative 1.0% in the same period one year
ago and negative 8.1% in the previous quarter.

Please refer to the attached table captioned "Reconciliation of GAAP Income
(Loss) from Operations to Non-GAAP Adjusted Income (Loss) from Operations" for
a reconciliation of income (loss) from operations under U.S. GAAP to adjusted
income (loss) from operations (non-GAAP).

Income Tax Benefits

Income tax benefits for the second quarter of 2013 were US$1.0 million,
compared to income tax benefits of US$664,000 in the same period one year ago
and income tax benefits of US$1.0 million in the previous quarter.

Net Loss Attributable to AirMedia's Shareholders

Net loss attributable to AirMedia's shareholders for the second quarter of
2013 was US$4.9 million, compared to net loss attributable to AirMedia's
shareholders of US$1.5 million in the same period one year ago and net loss
attributable to AirMedia's shareholders of US$3.6 million in the previous
quarter. The basic net loss attributable to AirMedia's shareholders per ADS
for the second quarter of 2013 was US$0.08, compared to basic net loss
attributable to AirMedia's shareholders per ADS of US$0.02 in the same period
one year ago and basic net loss attributable to AirMedia's shareholders per
ADS of US$0.06 in the previous quarter. The diluted net loss attributable to
AirMedia's shareholders per ADS for the second quarter of 2013 was US$0.08,
compared to diluted net loss attributable to AirMedia's shareholders per ADS
of US$0.02 in the same period one year ago and diluted net loss attributable
to AirMedia's shareholders per ADS of US$0.06 in the previous quarter.

Adjusted net loss attributable to AirMedia's shareholders (non-GAAP) was
US$4.5 million for the second quarter of 2013, compared to adjusted net income
attributable to AirMedia's shareholders (non-GAAP) of US$339,000 in the same
period one year ago and adjusted net loss attributable to AirMedia's
shareholders (non-GAAP) of US$3.1 million in the previous quarter. Adjusted
basic net loss attributable to AirMedia's shareholders per ADS (non-GAAP) was
US$0.07 for the second quarter of 2013, compared to adjusted basic net income
attributable to AirMedia's shareholders per ADS (non-GAAP) of US$0.01 in the
same period one year ago and adjusted basic net loss attributable to
AirMedia's shareholders per ADS (non-GAAP) of US$0.05 in the previous quarter.
Adjusted diluted net loss attributable to AirMedia's shareholders per ADS
(non-GAAP) was US$0.07 for the second quarter of 2013, compared to adjusted
diluted net income attributable to AirMedia's shareholders per ADS (non-GAAP)
of US$0.01 in the same period one year ago and adjusted diluted net loss
attributable to AirMedia's shareholders per ADS (non-GAAP) of US$0.05 in the
previous quarter.

Please refer to the attached table captioned "Reconciliation of GAAP Net
Income (Loss) and EPS to Non-GAAP Adjusted Net Income and EPS" for a
reconciliation of net income (loss) attributable to AirMedia's shareholders
and basic and diluted net income (loss) attributable to AirMedia's
shareholders per ADS under U.S. GAAP to adjusted net income attributable to
AirMedia's shareholders (non-GAAP) and adjusted basic and diluted net income
attributable to AirMedia's shareholders per ADS (non-GAAP).

Cash, Restricted Cash and Short-term Investments

Cash, restricted cash and short-term investments totaled US$125.2 million as
of June 30, 2013, compared to US$126.3 million as of December 31, 2012.

ADS Repurchases and Expansion of Share Repurchase Program

On March 21, 2011, AirMedia's board of directors authorized AirMedia to
repurchase up to US$20 million of its own outstanding ADSs within two years
from March 21, 2011. On September 24, 2012, AirMedia's board of directors
approved to increase the size of the share repurchase program to US$40 million
from US$20 million and to extend the termination date of the share repurchase
program to March 20, 2014 from March 20, 2013. As of August 11, 2013, AirMedia
had repurchased an aggregate of 6,093,182 ADSs on the open market for a total
consideration of US$16.8million.

Other Recent Developments

On July 25, 2013, AirMedia resumed operations of 98 TV-attached digital frames
at Terminal 1 and 2 of Hangzhou Xiaoshan International Airport, which
suspended operations in March 2011.

In July 2013, AirMedia extended its concession rights contract with Sinopec to
December 31, 2020 from the original expiration date of December 31, 2014. In
the supplemental contract evidencing the extension, Sinopec also authorized
AirMedia to install LED screens, a proven advertising format, in Sinopec's gas
stations.

On July 2, 2013, AirMedia commenced operations of a mega-size LED screen above
the security check areas in HohhotBaitaInternational Airport.

On June 6, 2013, AirMedia commenced operations of a mega-size LED screen above
the check-in counter areas at Terminal 2 in Beijing Airport.

On May 21, 2013, AirMedia commenced operations of 20 stand-alone digital
frames at newly opened Section D of Terminal 3 of Beijing Airport.

Business Outlook

AirMedia currently expects its net revenues for the third quarter of 2013 to
range from US$69.0 million to US$71.0 million, representing a year-over-year
decrease of 3.3% to 0.5% from the same period in 2012 and a
quarter-over-quarter increase of 8.9% to 12.0% from the previous quarter.

AirMedia currently expects its concession fees to be approximately US$43.0
million in the third quarter of 2013, representing a year-over-year decrease
of 3.4% from the same period in 2012 and a quarter-over-quarter decrease of
7.4% from the previous quarter.

The above forecast reflects AirMedia's current and preliminary view and is
therefore subject to change. Please refer to the Safe Harbor Statement below
for the factors that could cause actual results to differ materially from
those contained in any forward-looking statement.

Summary of Selected Operating Data

                       Quarter    Quarter    Quarter
                       Ended      Ended      Ended      Y/Y Growth  Q/Q Growth
                       June       March      June       Rate        Rate
                       30, 2013   31, 2013   30, 2012
Digital frames in
airports
Number of airports   36         33         33         9.1%        9.1%
in operation
 Number of time slots 34,921     31,946     33,012     5.8%        9.3%
available for sale (2)
 Number of time slots 11,149     12,935     9,535      16.9%       -13.8%
sold (3)
 Utilization rate (4) 31.9%      40.5%      28.9%      3.0%        -8.6%
 Average advertising
revenue per time slot  US$3,057   US$2,591   US$3,110   -1.7%       18.0%
sold (5)
Digital TV screens in
airports
 Number of airports   32         33         35         -8.6%       -3.0%
in operation
 Number of time slots 16,971     16,971     16,789     1.1%        0.0%
available for sale (1)
 Number of time slots 3,388      4,829      6,174      -45.1%      -29.8%
sold (3)
 Utilization rate (4) 20.0%      28.5%      36.8%      -16.8%      -8.5%
 Average advertising
revenue per time slot  US$782     US$570     US$553     41.4%       37.2%
sold (5)
Digital TV screens on
airplanes
 Number of airlines   7          8          9          -22.2%      -12.5%
in operation
 Number of time slots 370        372        444        -16.7%      -0.5%
available for sale (1)
 Number of time slots 95         135        204        -53.4%      -29.6%
sold (3)
 Utilization rate (4) 25.7%      36.3%      45.9%      -20.2%      -10.6%
 Average advertising
revenue per time slot  US$35,000  US$28,059  US$35,015  0.0%        24.7%
sold (5)
Traditional Media in
airports
Numbers of locations   956        908        930        2.8%        5.3%
available for sale (6)
Numbers of locations   578        546        587        -1.5%       5.9%
sold (7)
Utilization rate (8)   60.5%      60.1%      63.1%      -2.6%       0.4%
Average advertising
revenue per location   US$31,936  US$34,674  US$35,373  -9.7%       -7.9%
sold (9)

Notes:

(1) A time slot is defined as a 30-second equivalent advertising time unit for
digital TV screens in airports and digital TV screens on airplanes, which is
shown during each advertising cycle on a weekly basis in a given airport or on
a monthly basis on the routes of a given airline, respectively. AirMedia's
airport advertising programs are shown repeatedly on a daily basis during a
given week in one-hour cycles and each hour of programming includes 20 minutes
of advertising content, which allows the Company to sell a maximum of 40 time
slots per week. The number of time slots available for sale for the digital TV
screens in airports during the period presented is calculated by multiplying
the time slots available for sale per week per airport by the number of weeks
during the period presented when AirMedia had operations in each airport and
then calculating the sum of all the time slots available for sale for each of
the Company's network airports. The length of AirMedia's in-flight programs
typically ranges from approximately 45 minutes to an hour per flight,
approximately five to 13 minutes of which consist of advertising content. The
number of time slots available for sale for our digital TV screens on
airplanes during the period presented is calculated by multiplying the time
slots per airline per month by the number of months during the period
presented when AirMedia had operations on each airline and then calculating
the sum of all the time slots available for sale for each of its network
airlines.

(2) A time slot is defined as a 12-second equivalent advertising time or
6-second equivalent advertising time units for digital frames in airports,
which is shown during each standard advertising cycle on a weekly basis in a
given airport. AirMedia's standard airport advertising programs are shown
repeatedly on a daily basis during a given week in 10-minute cycles or
5-minute cycles, which allows the Company to sell a maximum of 50 time slots
per week. The length of time slot and advertising program cycle of some
digital frames in several airports are different from the standard ones. The
number of time slots available for sale for the digital frames in airports
during the period presented is calculated by multiplying the time slots per
week per airport by the number of weeks during the period presented when the
Company had operations in each airport and then calculating the sum of all the
time slots available for each of its network airports.

(3) Number of time slots sold refers to the number of 30-second equivalent
advertising time units for digital TV screens in airports and digital TV
screens on airplanes or 12-second equivalent advertising time units or
6-second equivalent advertising time units for digital frames in airports sold
during the period presented.

(4) Utilization rate for digital TV screens in airports, digital TV screens on
airplanes and digital frames in airports refers to total time slots sold as a
percentage of total time slots available for sale during the relevant period.

(5) Average advertising revenue per time slot sold for digital TV screens in
airports, digital TV screens on airplanes and digital frames in airports are
calculated by dividing each of the Company's revenues derived from digital TV
screens in airports, digital TV screens on airplanes and digital frames in
airports by the respective number of time slots sold.

(6) The number of locations available for sale in traditional media is defined
as the sum of (1) the number of light boxes and billboards in Beijing,
Shenzhen, Wenzhou and certain other airports (light boxes and billboards), and
(2) the number of gate bridges in certain airports (gate bridges).

(7) The number of locations sold is defined as the sum of (1) the number of
light boxes and billboards sold and (2) the number of gate bridges sold. To
calculate the number of light boxes and billboards sold in a given airport,
the "utilization rates of light boxes and billboards" in such airport is first
calculated by dividing the "total value of light boxes and billboards sold" in
such airport by the "total value of light boxes and billboards" in such
airport. The "total value of light box and billboard sold" in a given airport
is calculated as the daily listing prices of each light boxes and billboards
sold in such airport multiplied by their respective number of days sold during
the period presented. The "total value of light boxes and billboards" in a
given airport is calculated as the sum of quarterly listing prices of all the
light boxes and billboards in such airport during the period presented. The
number of light boxes and billboards sold in a given airport is then
calculated as the number of light boxes and billboards available for sale in
such airport multiplied by the utilization rates of light boxes and billboards
in such airport. The number of gate bridges sold in a given airport is counted
based on numbers in the relevant contracts.

(8) Utilization rate for traditional media in airports refers to total
locations sold as a percentage of total locations available for sale during
the period presented.

(9) Average advertising revenue per location sold is calculated by dividing
the revenues derived from all the locations sold by the number of locations
sold during the period presented.

Earnings Conference Call Details

AirMedia will hold a conference call to discuss the second quarter 2013
earnings at 8:00 PM U.S. Eastern Time on August 13, 2013 (5:00 PM U.S. Pacific
Time on August 13, 2013; 8:00 AM Beijing/Hong Kong time on August 14, 2013).
AirMedia's management team will be on the call to discuss financial results
and operational highlights and answer questions.

Conference Call Dial-in Information

U.S.: +1 866 519 4004
U.K.: 08082346646
Hong Kong: +852 800 930 346
International: +65 67239381
Pass code: AMCN

A replay of the call will be available for 1 week between 11:00 p.m. on August
13, 2013 and 11:59 p.m. on August 20, 2013, Eastern Time.

Replay Dial-in Information

U.S.: +1 855 452 5696
International: +61 2 8199 0299
Pass code: 28782000

Additionally, a live and archived webcast of this call will be available on
the Investor Relations section of AirMedia's corporate website at
http://ir.airmedia.net.cn 

Use of Non-GAAP Financial Measures

AirMedia's management uses non-GAAP financial measures to gain an
understanding of AirMedia's comparative operating performance and future
prospects. AirMedia's non-GAAP financial measures exclude the following
non-cash items: (1) share-based compensation expenses, (2) amortization of
acquired intangible assets, (3) impairment of goodwill, and (4) impairment of
intangible assets.

Non-GAAP financial measures are used by AirMedia's management in their
financial and operating decision-making, because management believes they
reflect AirMedia's ongoing business and operating performance in a manner that
allows meaningful period-to-period comparisons. AirMedia's management believes
that these non-GAAP financial measures provide useful information to investors
and others in understanding and evaluating AirMedia's operating performance in
the same manner as management does, if they so choose. Specifically, AirMedia
believes the non-GAAP financial measures provide useful information to both
management and investors by excluding certain charges that the Company
believes are not indicative of its core operating results.

The non-GAAP financial measures have limitations. They do not include all
items of income and expense that affect AirMedia's income from operations.
Specifically, these non-GAAP financial measures are not prepared in accordance
with GAAP, may not be comparable to non-GAAP financial measures used by other
companies and, with respect to the non-GAAP financial measures that exclude
certain items under GAAP, do not reflect any benefit that such items may
confer to AirMedia. Management compensates for these limitations by also
considering AirMedia's financial results as determined in accordance with
GAAP. The presentation of this additional information is not meant to be
considered superior to, in isolation from or as a substitute for results
prepared in accordance with US GAAP. For more information on these non-GAAP
financial measures, please see the table captioned "Reconciliation of GAAP Net
(Loss) Income and EPS and Non-GAAP Adjusted Net (Loss) Income and EPS",
"Reconciliation of GAAP Operating Expenses to Non-GAAP Adjusted Operating
Expenses" and "Reconciliation of GAAP (Loss) Income from Operations to
Non-GAAP Adjusted (Loss) Income from Operations" set forth at the end of this
release.

About AirMedia Group Inc.

AirMedia Group Inc. (Nasdaq: AMCN) is a leading operator of out-of-home
advertising platforms in China targeting mid-to-high-end consumers. AirMedia
operates the largest digital media network in China dedicated to air travel
advertising. AirMedia operates digital frames in 33 major airports and digital
TV screens in 33 major airports, including most of the 30 largest airports in
China. In addition, AirMedia sells advertisements on the routes operated by
seven airlines, including the four largest airlines in China. In selected
major airports, AirMedia also operates traditional media platforms, such as
billboards and light boxes, and other digital media, such as mega LED screens.

In addition, AirMedia has obtained exclusive contractual concession rights
until the end of 2020 to develop and operate outdoor advertising platforms at
Sinopec's service stations located throughout China.

For more information about AirMedia, please visit http://www.airmedia.net.cn.

Safe Harbor Statement

This announcement contains forward-looking statements. These statements are
made under the "safe harbor" provisions of the U.S. Private Securities
Litigation Reform Act of 1995. These forward-looking statements can be
identified by terminology such as "will," "expect," "anticipate," "future,"
"intend," "plan," "believe," "estimate," "confident" and similar statements.
Among other things, the Business Outlook section and the quotations from
management in this announcement, as well as AirMedia Group Inc.'s strategic
and operational plans, contain forward-looking statements. AirMedia may also
make written or oral forward-looking statements in its 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. Statements that are not
historical facts, including statements about AirMedia'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: if advertisers or the viewing public do not accept, or lose
interest in, AirMedia's air travel advertising network, AirMedia may be unable
to generate sufficient cash flow from its operating activities and its
prospects and results of operations could be negatively affected; AirMedia
derives most of its revenues from the provision of air travel advertising
services, and any slowdown in the air travel advertising industry in China may
materially and adversely affect its revenues and results of operations;
AirMedia's strategy of expanding its advertising network by building new air
travel media platforms and expanding into traditional media in airports may
not succeed, and its failure to do so could materially reduce the
attractiveness of its network and harm its business, reputation and results of
operations; if AirMedia does not succeed in its expansion into gas station and
other outdoors media advertising, its future results of operations and growth
prospects may be materially and adversely affected; if AirMedia's customers
reduce their advertising spending or are unable to pay AirMedia in full, in
part or at all for a period of time due to an economic downturn in China
and/or elsewhere or for any other reason, AirMedia's revenues and results of
operations may be materially and adversely affected; AirMedia faces risks
related to health epidemics, which could materially and adversely affect air
travel and result in reduced demand for its advertising services or disrupt
its operations; if AirMedia is unable to retain existing concession rights
contracts or obtain new concession rights contracts on commercially
advantageous terms that allow it to operate its advertising platforms,
AirMedia may be unable to maintain or expand its network coverage and its
business and prospects may be harmed; a significant portion of AirMedia's
revenues has been derived from the six largest airports and four largest
airlines in China, and if any of these airports or airlines experiences a
material business disruption, AirMedia's ability to generate revenues and its
results of operations would be materially and adversely affected; AirMedia's
limited operating history makes it difficult to evaluate its future prospects
and results of operations; and other risks outlined in AirMedia's filings with
the U.S. Securities and Exchange Commission. AirMedia does not undertake any
obligation to update any forward-looking statement, except as required under
applicable law.

Investor Contact:

Raymond Huang
Senior Director of Investor Relations
AirMedia Group Inc.
Tel: +86-10-8460-8678
Email: ir@airmedia.net.cn





AirMedia Group Inc.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(In U.S. dollars in thousands)
                                                        June 30, December 31,
                                                        2013     2012
ASSETS:
Current assets:
Cash                                                    75,972   73,634
Restricted cash                                         8,147    8,026
Short-term investments                                  41,060   44,622
Accounts receivable, net                                93,645   101,222
Notes Receivable                                        1,646    -
Prepaid concession fees                                 23,044   20,759
Amount due from related party                           749      1,310
Other current assets                                    22,696   9,788
Deferred tax assets - current                           2,093    2,064
Total current assets                                    269,052  261,425
Property and equipment, net                             37,666   45,930
Prepaid property and equipment costs                    48,741   -
Long-term investments                                   4,405    4,337
Long-term deposits                                      22,523   22,307
Deferred tax assets - non-current                       11,031   8,347
Acquired intangible assets, net                         1,150    1,521
Total assets                                            394,568  343,867
LIABILITIES AND EQUITY:
Current liabilities:
Accounts payable (including accounts payable of the
 consolidated variable interest entities without
recourse to
 AirMedia Group Inc. $71,045 and $108,473 as of
December 31,
 2012 and June 30, 2013, respectively)                 110,264  72,895
Accrued expenses and other current liabilities
 (including accrued expenses and other current
liabilities of
 the consolidated variable interest entities without
recourse
 to AirMedia Group Inc. $8,716 and $35,031 as of
December 31,
 2012 and June 30, 2013, respectively)                 36,911   10,999
Deferred revenue (including deferred revenue of the
 consolidated variable interest entities without
recourse to
 AirMedia Group Inc. $18,596 and $13,471 as of
December 31
 2012 and June 30, 2013, respectively)                 13,478   18,602
Income tax payable (including income tax payable of
the
 consolidated variable interest entities without
recourse to
 AirMedia Group Inc. $169 and $ 474 as of December
31,
 2012 and June 30, 2013, respectively)                 474      1,109
Amounts due to related parties (including amounts due
to
 related parties of the consolidated variable
interest entities
 without recourse to AirMedia Group Inc. $447 and
$454 as
 of December 31, 2012 and June 30, 2013,               454      447
respectively)
Total current liabilities                               161,581  104,052
Deferred tax liability - non-current                    287      380
Total liabilities                                       161,868  104,432
Equity
Ordinary shares                                         128      128
Additional paid-in capital                              277,131  278,652
Treasury stock                                          (9,235)  (7,035)
Statutory reserves                                      10,144   10,144
Accumulated deficits                                    (81,510) (72,961)
Accumulated other comprehensive income                  36,566   32,948
Total AirMedia Group Inc.'s shareholders' equity        233,224  241,876
Noncontrolling interests                               (524)    (2,441)
Total equity                                            232,700  239,435
Total liabilities and equity                           394,568  343,867





AirMedia Group Inc.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In U.S. dollars in thousands, except share and ADS related data)
                                           Three Months Ended
                                           June 30,    March 31,   June 30,
                                           2013        2013        2012
Revenues                                   64,345      64,547      68,133
Business tax and other sales tax           (972)       (935)       (1,550)
Net revenues                               63,373      63,612      66,583
Cost of revenues                           60,075      60,119      59,831
Gross profit                               3,298       3,493       6,752
Operating expenses:
 Selling and marketing *                  4,782       4,222       4,162
 General and administrative *             5,468       4,878       5,056
Total operating expenses                   10,250      9,100       9,218
Loss from operations                       (6,952)     (5,607)     (2,466)
Interest income                            113         388         225
Other income, net                          735         730         1,047
Loss before income taxes                   (6,104)     (4,489)     (1,194)
Income tax benefits                        1,036       1,043       664
Net loss before net income of equity       (5,068)     (3,446)     (530)
method investments
Net income (loss) of equity method         27          (24)        11
investments
Net loss                                   (5,041)     (3,470)     (519)
Less: Net (loss) income attributable to    (92)        130         951
noncontrolling interests
Net loss attributable to AirMedia Group    (4,949)     (3,600)     (1,470)
Inc.'s shareholders
Net loss attributable to AirMedia Group
Inc.'s shareholders per ordinary share
Basic                                      (0.04)      (0.03)      (0.01)
Diluted                                    (0.04)      (0.03)      (0.01)
Net loss attributable to AirMedia Group
Inc.'s shareholders per ADS
Basic                                      (0.08)      (0.06)      (0.02)
Diluted                                    (0.08)      (0.06)      (0.02)
Weighted average ordinary shares
outstanding used in computing net loss    120,639,142 121,738,551 125,181,769
per ordinary share - basic
Weighted average ordinary shares
outstanding used in computing net loss    120,639,142 121,738,551 125,181,769
per ordinary share - diluted
* Share-based compensation charges
included are as follow:
 Selling and marketing                    -           -           297
 General and administrative               277         280         696





AirMedia Group Inc.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(In U.S. dollars in thousands, except share and ADS related data)
                                                   Three Months Ended
                                                   June 30, March 31, June 30,
                                                   2013     2013      2012
Net loss                                           (5,041)  (3,470)   (519)
Other comprehensive income (loss)                  3,026    739       (2,255)
Comprehensive loss                                 (2,015)  (2,731)   (2,774)
Less: comprehensive income attributable to the     62       123       968
noncontrolling interest
Comprehensive loss attributable to AirMedia Group  (2,077)  (2,854)   (3,742)
Inc.'s shareholders







AirMedia Group Inc.
RECONCILIATION OF GAAP NET LOSS AND EPS TO NON-GAAP ADJUSTED NET (LOSS) INCOME
AND EPS
(In U.S. dollars in thousands, except share and ADS related data)
                                 Three Months Ended
                                 June 30,        March 31,      June 30,
                                 2013            2013           2012
Net loss attributable to
AirMedia Group Inc.'s            (4,949)         (3,600)        (1,470)
shareholders (GAAP)
Amortization of acquired         197             195            816
intangible assets
Share-based compensation         277             280            993
Adjusted net (loss) income
attributable to AirMedia         (4,475)         (3,125)        339
Group Inc.'s shareholders
(non-GAAP)
Adjusted net (loss) income
attributable to AirMedia
Group Inc.'s shareholders
per share (non-GAAP)
Basic                            (0.04)          (0.03)         0.00
Diluted                          (0.04)          (0.03)         0.00
Adjusted net (loss) income
attributable to AirMedia
Group Inc.'s shareholders
per ADS (non-GAAP)
Basic                            (0.07)          (0.05)         0.01
Diluted                          (0.07)          (0.05)         0.01
Shares used in computing
adjusted basic net (loss)
income attributable to           120,639,142     121,738,551    125,181,769
AirMedia Group Inc.'s
shareholders per share
(non-GAAP)
Shares used in computing
adjusted diluted net (loss)
income attributable to           120,639,142     121,738,551    125,181,769
AirMedia Group Inc.'s
shareholders per share
(non-GAAP)
Note: 1) The Non-GAAP adjusted net (loss) income per share and per ADS are
computed using Non-GAAP adjusted net (loss) income and number of shares and
ADSs used in GAAP basic and diluted EPS calculation, where the number of
shares and ADSs is adjusted for dilution due to the share-based compensation
plan.
AirMedia Group Inc.
RECONCILIATION OF GAAP OPERATING EXPENSES TO NON-GAAP ADJUSTED OPERATING
EXPENSES
(In U.S. dollars in thousands, except for percentages)
                                 Three Months Ended
                                 June 30,        March 31,      June 30,
                                 2013            2013           2012
Operating expenses (GAAP)        10,250          9,100          9,218
Amortization of acquired         197             195            816
intangible assets
Share-based compensation         277             280            993
Adjusted operating expenses      9,776           8,625          7,409
(non-GAAP)
Adjusted operating expenses
as a percentage of net           15.4%           13.6%          11.1%
revenues (non-GAAP)
AirMedia Group Inc.
RECONCILIATION OF GAAP LOSS FROM OPERATIONS TO NON-GAAP ADJUSTED LOSS FROM
OPERATIONS
(In U.S. dollars in thousands, except for percentages)
                                 Three Months Ended
                                 June 30,        March 31,      June 30,
                                 2013            2013           2012
Loss from operations             (6,952)         (5,607)        (2,466)
Amortization of acquired         197             195            816
intangible assets
Share-based compensation         277             280            993
Adjusted loss from               (6,478)         (5,132)        (657)
operations (non-GAAP)
Adjusted operating margin        -10.2%          -8.1%          -1.0%
(non-GAAP)

SOURCE AirMedia Group Inc.

Website: http://www.airmedia.net.cn
 
Press spacebar to pause and continue. Press esc to stop.