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Phoenix New Media Reports Fourth Quarter and Fiscal Year 2016 Unaudited Financial Results
  By PR Newswire

Live Conference Call to be Held at 9:00 PM U.S. Eastern Time on March 13

BEIJING, March 13, 2017 /PRNewswire/ -- Phoenix New Media Limited (NYSE: FENG), a leading new media company in China ("Phoenix New Media", "ifeng" or the "Company"), today announced its unaudited financial results for the fourth quarter and fiscal year ended December 31, 2016.

Fourth Quarter and Fiscal Year 2016 Highlights


  • Net advertising revenues for the fourth quarter of 2016 increased by 2.0% to RMB353.2 million (US$50.9 million) from RMB346.2 million in the same period last year.
  • Paid service revenues for the fourth quarter of 2016 were RMB58.7 million (US$8.5 million), as compared to RMB84.6 million in the same period last year.
  • Net advertising revenues for fiscal year 2016 were flat at RMB1.23 billion (US$177.5 million).
  • Paid service revenues for fiscal year 2016 were RMB212.7 million (US$30.6 million), as compared to RMB382.7 million in fiscal year 2015.

"We are very pleased to have delivered better than expected top- and bottom-line results," stated Mr. Shuang Liu, CEO of Phoenix New Media. "Our solid financial performance is a testament to the strengthening of our mobile platforms. In 2016, we made substantial strides in our mobile strategy as we continued to invest in both the ifeng News app and Yidian Zixun ("Yidian"[1], a strategic investment of ifeng), further driving our overall mobile expansion plan. Consequently, we witnessed significant increase in the Company's mobile advertising revenues by almost 54% year-over-year. As we continue investing into our mobile expansion, we will not lose focus of our core strengths and competencies in professional content creation. By creating our own live broadcasting brand, Feng Zhibo, we continued to focus on developing a differentiated, innovative, and industry leading approach to live broadcasting. We are confident that we are well positioned to capture market opportunities arising from the growing demand for media content on major events and current affairs that are having a growing impact on the global landscape. With an increasingly competitive industry environment, we expect this year will be another challenging year for us and our key objective is to gain market share through user expansion supported by big data technology and high-quality journalism."

Mr. Ya Li, President of Phoenix New Media, further stated, "As the industry and our viewers' consumption habits evolve, both ifeng and Yidian continued to make solid progress in improving our platform with cutting-edge technologies and high-quality proprietary content. The total daily active users of Yidian, including both app and browser, reached over 45 million in February 2017. We remain focused on enhancing our collaboration with leading Chinese handset manufacturers, such as OPPO and Xiaomi for Yidian app, and Huawei for ifeng News app, to further drive user growth. Looking ahead, we will continue to deepen these relationships in order to accelerate both apps' user growth and establish Yidian as the leading customized content consumption platform in China."

Fourth Quarter 2016 Financial Results

REVENUES

Total revenues for the fourth quarter of 2016 were RMB411.9 million (US$59.3 million), as compared to RMB430.8 million in the fourth quarter of 2015.

Net advertising revenues (net of advertising agency service fees) for the fourth quarter of 2016 increased by 2.0% to RMB353.2 million (US$50.9 million) from RMB346.2 million in the fourth quarter of 2015. The increase was primarily due to the 22.5% year-over-year growth in mobile advertising revenues and was partially offset by the 9.2% year-over-year decrease in PC advertising revenues.

Paid service revenues for the fourth quarter of 2016 were RMB58.7 million (US$8.5 million), as compared to RMB84.6 million in the fourth quarter of 2015, primarily due to the 47.9% year-over-year decrease in mobile value-added services ("MVAS") [2] revenues to RMB31.1 million (US$4.5 million) from RMB59.6 million in the fourth quarter of 2015. The decrease in MVAS revenues mainly resulted from the decline in users' demand for services provided through telecom operators in China, which was consistent with the Company's expectations given the shrinking demand for such services in general. Revenues from games and others[3] for the fourth quarter of 2016 increased by 10.6% to RMB27.7 million (US$4.0 million) from RMB25.0 million in the fourth quarter of 2015, which was primarily due to the increase in revenues from online digital reading.

COST OF REVENUES

Cost of revenues for the fourth quarter of 2016 decreased by 0.9% to RMB205.2 million (US$29.6 million) from RMB207.0 million in the fourth quarter of 2015, which was primarily due to the decrease in revenue sharing fees. Revenue sharing fees to telecom operators and channel partners for the fourth quarter of 2016 decreased to RMB17.3 million (US$2.5 million) from RMB46.6 million in the fourth quarter of 2015, which was primarily due to the decrease in sales of MVAS products. Content and operational costs for the fourth quarter of 2016 increased to RMB138.6 million (US$20.0 million) from RMB106.6 million in the fourth quarter of 2015, which was primarily due to the increase in general operating cost and advertisement-related content production cost. Bandwidth costs for the fourth quarter of 2016 decreased to RMB15.2 million (US$2.2 million) from RMB19.7 million in the fourth quarter of 2015. Sales taxes and surcharges for the fourth quarter of 2016 slightly decreased to RMB34.1 million (US$4.9 million) from RMB34.2 million in the fourth quarter of 2015. Share-based compensation included in cost of revenues was negative RMB0.9 million (negative US$0.1 million) in the fourth quarter of 2016, as compared to negative RMB7.3 million in the fourth quarter of 2015. The change in share-based compensation was due to the adjustment of the estimated forfeiture rate of share-based awards in the fourth quarter of 2016, which was partially offset by the newly granted share-based awards and the Company's option exchange program implemented in the fourth quarter of 2016.

GROSS PROFIT

Gross profit for the fourth quarter of 2016 was RMB206.7 million (US$29.8 million), as compared to RMB223.7 million in the fourth quarter of 2015. Gross margin for the fourth quarter of 2016 was 50.2% as compared to 51.9% in the fourth quarter of 2015. The decrease in gross margin was primarily due to the increase in share-based compensation.

To supplement the financial measures presented in accordance with the United States Generally Accepted Accounting Principles ("GAAP"), the Company has presented certain non-GAAP financial measures in this press release, which excluded the impact of certain non-cash or non-operating items as stated in the "Use of Non-GAAP Financial Measures" section below. The related reconciliations to GAAP financial measures are presented in the accompanying "Reconciliations of Non-GAAP Results of Operation Measures to the Nearest Comparable GAAP Measures".

Non-GAAP gross margin, which excludes share-based compensation, for the fourth quarter of 2016 was 49.9%, as compared to 50.2% in the fourth quarter of 2015.

OPERATING EXPENSES AND INCOME FROM OPERATIONS

Total operating expenses for the fourth quarter of 2016 decreased by 0.8% to RMB185.2 million (US$26.7 million) from RMB186.7 million in the fourth quarter of 2015. Share-based compensation included in operating expenses was RMB2.5 million (US$0.4 million) in the fourth quarter of 2016, as compared to RMB1.3 million in the fourth quarter of 2015. The increase was primarily due to the newly granted share-based awards and the Company's option exchange program implemented in the fourth quarter of 2016.

Income from operations for the fourth quarter of 2016 was RMB21.5 million (US$3.1 million), as compared to RMB37.0 million in the fourth quarter of 2015. Operating margin for the fourth quarter of 2016 was 5.2%, as compared to 8.6% in the fourth quarter of 2015. The decrease in operating margin was mainly due to the increase in advertisement-related content production cost and mobile traffic acquisition expenses.

Non-GAAP income from operations for the fourth quarter of 2016, which excludes share-based compensation, was RMB23.0 million (US$3.3 million), as compared to RMB31.1 million in the fourth quarter of 2015. Non-GAAP operating margin for the fourth quarter of 2016, which excludes share-based compensation, was 5.6%, as compared to 7.2% in the fourth quarter of 2015.

OTHER INCOME/(LOSS)

Other income/(loss) reflects interest income, interest expense, foreign currency exchange gain/loss, loss from equity investments, including impairments, gain on the disposal of an equity investment and acquisition of available-for-sale investments, and others, net[4]. Total other income for the fourth quarter of 2016 increased to RMB27.1 million (US$3.9 million) from RMB10.8 million in the fourth quarter of 2015. Interest income for the fourth quarter of 2016 was RMB10.8 million (US$1.6 million), as compared to RMB7.5 million in the fourth quarter of 2015. Interest expense for the fourth quarter of 2016 was RMB3.8 million (US$0.5 million), as compared to RMB0.7 million in the fourth quarter of 2015. Foreign currency exchange gain for the fourth quarter of 2016 was RMB8.5 million (US$1.2 million), as compared to RMB0.7 million in the fourth quarter of 2015. Loss from equity investments, including impairments for the fourth quarter of 2016 was RMB0.03 million (US$0.004 million), as compared to RMB9.8 million in the fourth quarter of 2015.

NET INCOME ATTRIBUTABLE TO PHOENIX NEW MEDIA LIMITED

Net income attributable to Phoenix New Media Limited for the fourth quarter of 2016 was RMB39.8 million (US$5.7 million), as compared to RMB41.1 million in the fourth quarter of 2015. Net profit margin for the fourth quarter of 2016 increased to 9.7% from 9.5% in the fourth quarter of 2015. Net income per diluted ADS[5] in the fourth quarter of 2016 was RMB0.55 (US$0.08), as compared to RMB0.57 in the fourth quarter of 2015.

Non-GAAP net income attributable to Phoenix New Media Limited for the fourth quarter of 2016, which excludes share-based compensation and loss from equity investments, including impairments was RMB41.4 million (US$6.0 million), as compared to RMB44.9 million in the fourth quarter of 2015. Non-GAAP net profit margin for the fourth quarter of 2016 was 10.0%, as compared to 10.4% in the fourth quarter of 2015. Non-GAAP net income per diluted ADS in the fourth quarter of 2016 was RMB0.57 (US$0.08), as compared to RMB0.62 in the fourth quarter of 2015.

For the fourth quarter of 2016, the Company's weighted average number of ADSs used in the computation of diluted net income per ADS was 72,161,340. As of December 31, 2016, the Company had a total of 572,235,150 ordinary shares outstanding, or the equivalent of 71,529,394 ADSs.

CERTAIN BALANCE SHEET ITEMS

As of December 31, 2016, the Company's cash and cash equivalents, term deposits and short term investments and restricted cash were RMB1.34 billion (US$192.8 million). Restricted cash represents deposits placed as security for banking facility granted to the company, which are restricted as to their withdrawal or usage.

Fiscal Year 2016 Financial Results

REVENUES

Total revenues for fiscal year 2016 were RMB1.44 billion (US$208.1 million), as compared to RMB1.61 billion in fiscal year 2015.

Net advertising revenues (net of advertising agency service fees) for fiscal year 2016 were flat at RMB1.23 billion (US$177.5 million), primarily due to the 53.8% year-over-year growth in mobile advertising revenues, which was offset by the decrease in PC advertising revenues.

Paid service revenues for fiscal year 2016 decreased by 44.4% to RMB212.7 million (US$30.6 million) from RMB382.7 million in fiscal year 2015, which was primarily due to the decrease in revenues generated from mobile value-added services with telecom operators.

COST OF REVENUES AND GROSS PROFIT

Cost of revenues for fiscal year 2016 decreased to RMB726.8 million (US$104.7 million) from RMB829.4 million in fiscal year 2015, which was primarily due to the decrease in revenue sharing fees. Share-based compensation included in cost of revenues was negative RMB4.4 million (negative US$0.6 million) in fiscal year 2016, as compared to RMB6.3 million in fiscal year 2015. The decrease in share-based compensation included in cost of revenues was mainly due to adjustments of the estimated forfeiture rate of share-based awards in 2016, which was partially offset by the Company's option exchange program implemented in the fourth quarter of 2016.

Gross profit for fiscal year 2016 was RMB718.1 million (US$103.4 million), as compared to RMB779.8 million in fiscal year 2015. Gross margin for fiscal year 2016 increased to 49.7% from 48.5% in fiscal year 2015, which was primarily due to the reduction of sales from low gross margin products in paid services. Non-GAAP gross margin, which excludes share-based compensation, for fiscal year 2016 increased to 49.4% from 48.9% in fiscal year 2015.

OPERATING EXPENSES AND INCOME FROM OPERATIONS

Total operating expenses for fiscal year 2016 decreased to RMB682.7 million (US$98.3 million) from RMB700.8 million in fiscal year 2015. The decrease in operating expenses was primarily attributable to the decrease in general operating expense and was partially offset by the increase in expenses associated with mobile traffic acquisition. Share-based compensation included in operating expenses decreased to RMB6.3 million (US$0.9 million) in fiscal year 2016 from RMB28.0 million in fiscal year 2015, which was mainly due to adjustments of the estimated forfeiture rate of share-based awards in 2016 and was partially offset by the Company's option exchange program implemented in the fourth quarter of 2016.

Income from operations for fiscal year 2016 was RMB35.4 million (US$5.1 million), as compared to RMB79.0 million in fiscal year 2015. Operating margin for fiscal year 2016 was 2.4%, as compared to 4.9% in fiscal year 2015, which was primarily due to the increase in mobile traffic acquisition expenses.

Non-GAAP income from operations, which excludes share-based compensation, for fiscal year 2016 was RMB37.3 million (US$5.4 million), as compared to RMB113.3 million in fiscal year 2015. Non-GAAP operating margin for fiscal year 2016 was 2.6%, as compared to 7.0% in fiscal year 2015, which was primarily due to the increase in mobile traffic acquisition expenses.

NET INCOME ATTRIBUTABLE TO PHOENIX NEW MEDIA LIMITED

Net income attributable to Phoenix New Media Limited for fiscal year 2016 increased by 9.5% to RMB80.6 million (US$11.6 million) from RMB73.6 million in fiscal year 2015. Net profit margin for fiscal year 2016 increased to 5.6% from 4.6% in fiscal year 2015. Net income per diluted ADS for fiscal year 2016 increased by 10.3% to RMB1.12 (US$0.16) from RMB1.01 in fiscal year 2015. 

Non-GAAP net income attributable to Phoenix New Media Limited for fiscal year 2016, which excludes share-based compensation, loss from equity investments, including impairments, gain on disposal of an equity investments and acquisition of available-for-sale investments, was RMB84.3 million (US$12.1million), as compared to RMB145.2 million in fiscal year 2015. Non-GAAP net profit margin for fiscal year 2016 was 5.8%, as compared to 9.0% in fiscal year 2015. Non-GAAP net income per diluted ADS for fiscal year 2016 was RMB1.17 (US$0.17), as compared to RMB2.00 in fiscal year 2015.

Business Outlook

For the first quarter of 2017, the Company expects its total revenues to be between RMB285 million and RMB300 million. Net advertising revenues are expected to be between RMB239 million and RMB249 million. Paid service revenues are expected to be between RMB46 million and RMB51 million. These forecasts reflect the Company's current and preliminary view on the market and operational conditions, which are subject to change.

Conference Call Information

The Company will hold a conference call at 9:00 p.m. U.S. Eastern Time on March 13, 2017 (March 14, 2017 at 9:00 a.m. Beijing/Hong Kong time) to discuss its fourth quarter and fiscal year 2016 unaudited financial results and operating performance.

To participate in the call, please use the dial-in numbers and conference ID below:

International: 

+6567135440

Mainland China: 

4001200654

Hong Kong:

+85230186776

United States:

+18456750438

Conference ID:

74732880

A replay of the call will be available through March 20, 2017 by using the dial-in numbers and conference ID below:

International:

+61290034211

Mainland China: 

4006322162

Hong Kong:

+85230512780

United States: 

+16462543697

Conference ID:

74732880

A live and archived webcast of the conference call will also be available at the Company's investor relations website at http://ir.ifeng.com.

Use of Non-GAAP Financial Measures

To supplement the consolidated financial statements presented in accordance with the United States Generally Accepted Accounting Principles ("GAAP"), Phoenix New Media Limited uses non-GAAP gross profit, non-GAAP gross margin, non-GAAP income from operations, non-GAAP operating margin, non-GAAP net income attributable to Phoenix New Media Limited, non-GAAP net profit margin and non-GAAP net income per diluted ADS, each of which is a non-GAAP financial measure. Non-GAAP gross profit is gross profit excluding share-based compensation. Non-GAAP gross margin is non-GAAP gross profit divided by total revenues. Non-GAAP income from operations is income from operations excluding share-based compensation. Non-GAAP operating margin is non-GAAP income from operations divided by total revenues. Non-GAAP net income attributable to Phoenix New Media Limited is net income attributable to Phoenix New Media Limited excluding share-based compensation, loss from equity investments, including impairments and gain on disposal of an equity investment and acquisition of available-for-sale investments. Non-GAAP net profit margin is non-GAAP net income attributable to Phoenix New Media Limited divided by total revenues. Non-GAAP net income per diluted ADS is non-GAAP net income attributable to Phoenix New Media Limited divided by weighted average number of diluted ADSs. The Company believes that separate analysis and exclusion of the non-cash impact of share-based compensation and the non-operating impact of gain/loss from equity investments, including impairments and gain on disposal of an equity investment and acquisition of available-for-sale investments, add clarity to the constituent parts of its performance. The Company reviews non-GAAP net income together with net income to obtain a better understanding of its operating performance. It uses these non-GAAP financial measures for planning, forecasting and measuring results against the forecast. The Company believes that using multiple measures to evaluate its business allows both management and investors to assess the Company's performance against its competitors. The Company also believes that non-GAAP financial measures are useful supplemental information for investors and analysts to assess its operating performance without the effect of non-cash share-based compensation and non-operating loss from equity investments, including impairments and gain on disposal of an equity investment and acquisition of available-for-sale investments. Share-based compensation and loss from equity investments, including impairments have been and will continue to be significant and recurring in its business. However, the use of non-GAAP financial measures has material limitations as an analytical tool. One of the limitations of using non-GAAP financial measures is that they do not include all items that impact the Company's net income for the period. In addition, because non-GAAP financial measures are not measured in the same manner by all companies, they may not be comparable to other similarly-titled measures used by other companies. In light of the foregoing limitations, you should not consider non-GAAP financial measure in isolation from, or as an alternative to, the financial measures prepared in accordance with GAAP.

Exchange Rate

This announcement contains translations of certain RMB amounts into U.S. dollars ("USD") at specified rates solely for the convenience of the reader. Unless otherwise stated, all translations from RMB to USD were made at the rate of RMB6.9430 to US$1.00, the noon buying rate in effect on December 30, 2016 in the H.10 statistical release of the Federal Reserve Board. The Company makes no representation that the RMB or USD amounts referred could be converted into USD or RMB, as the case may be, at any particular rate or at all. For analytical presentation, all percentages are calculated using the numbers presented in the financial statements contained in this earnings release.

About Phoenix New Media Limited

Phoenix New Media Limited (NYSE: FENG) is a leading new media company providing premium content on an integrated platform across Internet, mobile and TV channels in China. Having originated from a leading global Chinese language TV network based in Hong Kong, Phoenix TV, the Company enables consumers to access professional news and other quality information and share user-generated content on the Internet and through their mobile devices. Phoenix New Media's platform includes its ifeng.com channel, consisting of its ifeng.com website and web-based game platform, its video channel, comprised of its dedicated video vertical and mobile video services, and its mobile channel, including its mobile Internet website, mobile applications and mobile value-added services.

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," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Among other things, the business outlook and quotations from management in this announcement, as well as Phoenix New Media's strategic and operational plans, contain forward?looking statements. Phoenix New Media may also make written or oral forward?looking statements in its periodic reports to the U.S. Securities and Exchange Commission ("SEC") on Forms 20?F and 6?K, 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 Phoenix New Media's beliefs and expectations, are forward?looking statements. Forward?looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward?looking statement, including but not limited to the following: the Company's goals and strategies; the Company's future business development, financial condition and results of operations; the expected growth of online and mobile advertising, online video and mobile paid services markets in China; the Company's reliance on online and mobile advertising and MVAS for a majority of its total revenues; the Company's expectations regarding demand for and market acceptance of its services; the Company's expectations regarding maintaining and strengthening its relationships with advertisers, partners and customers; fluctuations in the Company's quarterly operating results; the Company's plans to enhance its user experience, infrastructure and services offerings; the Company's reliance on mobile operators in China to provide most of its MVAS; changes by mobile operators in China to their policies for MVAS; competition in its industry in China; and relevant government policies and regulations relating to the Company. Further information regarding these and other risks is included in the Company's filings with the SEC, including its registration statement on Form F?1, as amended, and its annual reports on Form 20?F. All information provided in this press release and in the attachments is as of the date of this press release, and Phoenix New Media does not undertake any obligation to update any forward?looking statement, except as required under applicable law.

[1] The Company has accounted for its investments in Yidian as available-for-sale investments.
[2] MVAS includes wireless value-added services, or WVAS, mobile video, mobile digital reading, mobile games and other paid services through China's three telecom operators' platforms.
[3] Games and others include web-based games, online digital reading, content sales, and other online and mobile paid services through the Company's own platforms.
[4] "Others, net" primarily consists of government subsidies.
[5] "ADS" means American Depositary Share of the Company. Each ADS represents eight Class A ordinary shares of the Company.

For investor and media inquiries please contact:

Phoenix New Media Limited
Matthew Zhao
Email: [email protected]  

ICR, Inc.
Vera Tang
Tel: +1 (646) 277-1215
Email: [email protected]

 

Phoenix New Media Limited

Condensed Consolidated Balance Sheets

(Amounts in thousands)


December 31,


December 31,


December 31,

2015

2016


2016


RMB


RMB


US$


Audited*


Unaudited


Unaudited







ASSETS






Current assets:






Cash and cash equivalents

310,669


202,694


29,194

Term deposits and short term investments

769,681


781,298


112,530

Restricted cash

125,000


354,602


51,073

Accounts receivable, net

506,351


405,033


58,337

Amounts due from related parties

124,677


156,260


22,506

Prepayment and other current assets

58,574


64,069


9,228

Convertible debts from a related party

-


104,429


15,041

Deferred tax assets

35,963


54,307


7,822

Total current assets

1,930,915


2,122,692


305,731

Non-current assets:






Property and equipment, net

80,537


72,087


10,383

Intangible assets, net

12,404


9,475


1,365

Available-for-sale investments

513,994


939,432


135,306

Equity investments, net

11,610


8,809


1,269

Other non-current assets

17,746


16,047


2,311

Total non-current assets

636,291


1,045,850


150,634

Total assets

2,567,206


3,168,542


456,365

LIABILITIES AND SHAREHOLDERS' EQUITY






Current liabilities:






Short-term loans

131,046


358,602


51,649

Accounts payable

289,148


260,902


37,578

Amounts due to related parties

19,368


18,720


2,696

Advances from customers

15,239


27,825


4,008

Taxes payable

93,120


75,652


10,896

Salary and welfare payable

114,028


130,329


18,771

Accrued expenses and other current liabilities

80,891


111,049


15,994

Total current liabilities

742,840


983,079


141,592

Non-current liabilities:






Deferred tax liabilities

1,312


1,312


189

Long-term liabilities

18,368


21,723


3,129

Total non-current liabilities

19,680


23,035


3,318

Total liabilities

762,520


1,006,114


144,910

Shareholders' equity:






Phoenix New Media Limited shareholders' equity:






Class A ordinary shares

16,733


16,843


2,426

Class B ordinary shares

22,053


22,053


3,176

Additional paid-in capital

1,551,104


1,555,511


224,040

Statutory reserves

70,311


77,946


11,227

Retained earnings

122,093


195,069


28,096

Accumulated other comprehensive income

23,341


298,346


42,971

Total Phoenix New Media Limited shareholders' equity

1,805,635


2,165,768


311,936

Noncontrolling interests

(949)


(3,340)


(481)

Total shareholders' equity

1,804,686


2,162,428


311,455

Total liabilities and shareholders' equity

2,567,206


3,168,542


456,365







* Derived from audited financial statements included in the Company's Form 20-F dated April 28, 2016.

 

 

Phoenix New Media Limited

Condensed Consolidated Statements of Comprehensive Income

(Amounts in thousands, except for number of shares and per share (or ADS) data)
















Three Months Ended


Twelve Months Ended


December 31,


September 30,


December 31,


December 31,


December 31,


December 31,


December 31,


2015


2016


2016


2016


2015


2016


2016


RMB


RMB


RMB


US$


RMB


RMB


US$


Unaudited


Unaudited


Unaudited


Unaudited


Audited*


Unaudited


Unaudited















Revenues:














  Net advertising revenues

346,190


310,439


353,158


50,865


1,226,516


1,232,210


177,475

  Paid service revenues

84,579


49,583


58,724


8,458


382,680


212,697


30,635

Total revenues

430,769


360,022


411,882


59,323


1,609,196


1,444,907


208,110

Cost of revenues

(207,028)


(182,927)


(205,204)


(29,556)


(829,386)


(726,807)


(104,682)

Gross profit

223,741


177,095


206,678


29,767


779,810


718,100


103,428

Operating expenses:














  Sales and marketing expenses

(82,756)


(74,210)


(102,386)


(14,747)


(346,133)


(339,171)


(48,851)

  General and administrative expenses

(60,020)


(37,897)


(41,150)


(5,927)


(183,989)


(181,677)


(26,167)

  Technology and product development expenses

(43,958)


(37,756)


(41,692)


(6,005)


(170,714)


(161,880)


(23,316)

Total operating expenses

(186,734)


(149,863)


(185,228)


(26,679)


(700,836)


(682,728)


(98,334)

Income from operations

37,007


27,232


21,450


3,088


78,974


35,372


5,094

Other income/(loss):














  Interest income

7,482


7,943


10,785


1,553


30,234


35,113


5,057

  Interest expense

(728)


(1,554)


(3,778)


(544)


(2,328)


(7,061)


(1,017)

  Foreign currency exchange gain/(loss)

743


575


8,486


1,222


(1,054)


9,608


1,384

  Loss from equity investments, including impairments

(9,771)


(1,242)


(29)


(4)


(41,861)


(1,776)


(256)

  Gain on disposal of an equity investment and acquisition of available-for-sale investments

-


-


-


-


4,643


-


-

  Others, net

13,066


1,021


11,606


1,672


29,294


21,053


3,032

Income before tax

47,799


33,975


48,520


6,987


97,902


92,309


13,294

  Income tax expense

(7,158)


(2,879)


(9,253)


(1,333)


(25,517)


(14,089)


(2,029)

Net income

40,641


31,096


39,267


5,654


72,385


78,220


11,265

  Net loss attributable to noncontrolling interests

422


599


512


74


1,199


2,391


344

Net income attributable to Phoenix New Media Limited

41,063


31,695


39,779


5,728


73,584


80,611


11,609

Net income

40,641


31,096


39,267


5,654


72,385


78,220


11,265

  Other comprehensive income/(loss), net of tax: fair value remeasurement for available-for-sale investments

13,376


(39,610)


270,303


38,932


15,869


247,336


35,624

  Other comprehensive income, net of tax: foreign currency translation adjustment

27,220


2,920


15,815


2,278


22,813


27,669


3,985

Comprehensive income/(loss)

81,237


(5,594)


325,385


46,864


111,067


353,225


50,874

  Comprehensive loss attributable to noncontrolling interests

422


599


512


74


1,199


2,391


344

Comprehensive income/(loss) attributable to Phoenix New Media Limited

81,659


(4,995)


325,897


46,938


112,266


355,616


51,218

Net income attributable to Phoenix New Media Limited

41,063


31,695


39,779


5,728


73,584


80,611


11,609

Net income per Class A and Class B ordinary share:














  Basic

0.07


0.06


0.07


0.01


0.13


0.14


0.02

  Diluted

0.07


0.05


0.07


0.01


0.13


0.14


0.02

Net income per ADS (1 ADS represents 8   Class A ordinary shares):














  Basic

0.57


0.44


0.55


0.08


1.03


1.12


0.16

  Diluted

0.57


0.44


0.55


0.08


1.01


1.12


0.16

Weighted average number of Class A and Class B ordinary shares used in computing net income per share:














  Basic

572,175,288


574,124,546


574,115,251


574,115,251


571,247,723


573,521,536


573,521,536

  Diluted

578,625,484


577,432,460


577,290,719


577,290,719


580,785,256


577,037,906


577,037,906















*Derived from audited financial statements included in the Company's Form 20-F dated April 28, 2016.

 

 

Phoenix New Media Limited

Condensed Segments Information

(Amounts in thousands)


Three Months Ended


Twelve Months Ended


December 31,


September 30,


December 31,


December 31,


December 31,


December 31,


December 31,


2015


2016


2016


2016


2015


2016


2016


RMB


RMB


RMB


US$


RMB


RMB


US$


Unaudited


Unaudited


Unaudited


Unaudited


Unaudited


Unaudited


Unaudited















Revenues:














  Net advertising service

346,190


310,439


353,158


50,865


1,226,516


1,232,210


177,475

  Paid service

84,579


49,583


58,724


8,458


382,680


212,697


30,635

Total revenues

430,769


360,022


411,882


59,323


1,609,196


1,444,907


208,110

Cost of revenues














  Net advertising service

143,144


151,770


174,005


25,062


557,421


598,040


86,136

  Paid service

63,884


31,157


31,199


4,494


271,965


128,767


18,546

Total cost of revenues

207,028


182,927


205,204


29,556


829,386


726,807


104,682

Gross profit














  Net advertising service

203,046


158,669


179,153


25,803


669,095


634,170


91,339

  Paid service

20,695


18,426


27,525


3,964


110,715


83,930


12,089

Total gross profit

223,741


177,095


206,678


29,767


779,810


718,100


103,428

 

 

Reconciliations of Non-GAAP Results of Operations Measures to the Nearest Comparable GAAP Measures

(Amounts in thousands, except for number of ADSs and per ADS data)




















Three Months Ended December 31, 2015


Three Months Ended September 30, 2016


Three Months Ended December 31, 2016




Non-GAAP






Non-GAAP






Non-GAAP




GAAP


Adjustments


Non-GAAP


GAAP


Adjustments


Non-GAAP


GAAP


Adjustments


Non-GAAP


RMB


RMB


RMB


RMB


RMB


RMB


RMB


RMB


RMB


Unaudited


Unaudited


Unaudited


Unaudited


Unaudited


Unaudited


Unaudited


Unaudited


Unaudited

Gross profit

223,741


(7,289)

(1)

216,452


177,095


(5,115)

(1)

171,980


206,678


(949)

(1)

205,729

Gross margin

51.9%




50.2%


49.2%




47.8%


50.2%




49.9%

Income from operations

37,007


(5,957)

(1)

31,050


27,232


(8,186)

(1)

19,046


21,450


1,542

(1)

22,992

Operating profit margin

8.6%




7.2%


7.6%




5.3%


5.2%




5.6%




(5,957)

(1)





(8,186)

(1)





1,542

(1)





9,771

(2)





1,242

(2)





29

(2)


Net income attributable to Phoenix New Media Limited

41,063


3,814


44,877


31,695


(6,944)


24,751


39,779


1,571


41,350

Net profit margin

9.5%




10.4%


8.8%




6.9%


9.7%




10.0%

Net income per ADS?diluted

0.57




0.62


0.44




0.34


0.55




0.57

Weighted average number of ADSs used in computing
  diluted net income per ADS

72,328,186




72,328,186


72,179,058




72,179,058


72,161,340




72,161,340


(1) Share-based compensation
(2) Loss from equity investments, including impairments


Non-GAAP to GAAP reconciling items have no income tax effect.




















Twelve Months Ended December 31, 2015


Twelve Months Ended December 31, 2016






Non-GAAP






Non-GAAP










GAAP


Adjustments


Non-GAAP


GAAP


Adjustments


Non-GAAP








RMB


RMB


RMB


RMB


RMB


RMB








Unaudited


Unaudited


Unaudited


Unaudited


Unaudited


Unaudited







Gross profit

779,810


6,335

(1)

786,145


718,100


(4,367)

(1)

713,733







Gross margin

48.5%




48.9%


49.7%




49.4%







Income from operations

78,974


34,354

(1)

113,328


35,372


1,890

(1)

37,262







Operating margin

4.9%




7.0%


2.4%




2.6%




























34,354

(1)

















41,861

(2)





1,890

(1)











(4,643)

(3)





1,776

(2)








Net income attributable to Phoenix New Media Limited

73,584


71,572


145,156


80,611


3,666


84,277


-





Net profit margin

4.6%




9.0%


5.6%




5.8%







Net income per ADS?diluted

1.01




2.00


1.12




1.17







Weighted average number of ADSs used in computing
  diluted net income per ADS

72,598,157




72,598,157


72,129,738




72,129,738

























(1) Share-based compensation

(2) Loss/(gain) from equity investments, including impairments

(3) Gain on disposal of an equity investment and acquisition of available-for-sale investments


Non-GAAP to GAAP reconciling items have no income tax effect.





















Details of cost of revenues are as follows:












Three Months Ended


Twelve Months Ended






December 31,


September 30,


December 31,


December 31,


December 31,


December 31,


December 31,






2015


2016


2016


2016


2015


2016


2016






RMB


RMB


RMB


US$


RMB


RMB


US$





(Amounts in thousands)

Unaudited


Unaudited


Unaudited


Unaudited


Audited*


Unaudited


Unaudited





Revenue sharing fees

46,603


16,559


17,340


2,497


216,973


72,027


10,374





Content and operational costs

106,585


119,538


138,635


19,969


406,741


470,813


67,811





Bandwidth costs

19,662


16,404


15,160


2,183


83,170


64,200


9,247





Sales taxes and surcharges

34,178


30,426


34,069


4,907


122,502


119,767


17,250





Total cost of revenues

207,028


182,927


205,204


29,556


829,386


726,807


104,682























* Derived from audited financial statements included in the Company's Form 20-F dated April 28, 2016.





To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/phoenix-new-media-reports-fourth-quarter-and-fiscal-year-2016-unaudited-financial-results-300422731.html

SOURCE Phoenix New Media Limited

Copyright 2014 PR Newswire. All Rights Reserved


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