SHANGHAI, China, Aug. 24 /PRNewswire-Asia-FirstCall/ -- The9
Limited (Nasdaq: NCTY) ("The9"), an online game operator and
developer in China, announced
today its unaudited financial results for the quarters ended
March 31 and June 30, 2010.
Financial Highlights:
First Quarter 2010
-- Net revenues for the first quarter of 2010 increased by 6% quarter-
over-quarter but decreased by 95% year-over-year to RMB22.1 million
(US$3.3 million).
-- Net loss for the first quarter of 2010 decreased by 63% quarter-over-
quarter but increased by 62% year-over-year to RMB75.8 million (US$11.2
million).
Second Quarter 2010
-- Net revenues for the second quarter of 2010 increased by 15% quarter-
over-quarter but decreased by 91% year-over-year to RMB25.4 million
(US$3.7 million).
-- Net loss for the second quarter of 2010 decreased by 13% quarter-over-
quarter and decreased by 17% year-over-year to RMB65.8 million (US$9.7
million).
The decrease in year-over-year net revenues in both quarters was
mainly due to the decrease in revenue from World of Warcraft
("WoW"), for which the license agreement expired on June 7, 2009.
Business Highlights:
In January 2010, The9 launched its
first proprietary 2D MMORPG, World of Fighter, which has been well
received by China domestic game
players and licensed to Hong Kong,
Macau, Taiwan, Korea, Vietnam and Thailand.
In April 2010, The9 acquired a
majority interest in Red 5 Studios, Inc., an online game studio
based in Los Angeles.
In June 2010, The9 set up The9
Interactive, Inc., a wholly owned subsidiary based in San Jose, to focus on operating our
proprietary games in the U.S. and searching for overseas business
opportunity.
In June 2010, The9 and Sony Online
Entertainment entered into an agreement pursuant to which The9
obtained an exclusive license to operate Free Realms, a 3D cartoon
fairy massively multiplayer online role-playing game in mainland
China.
In July 2010, The9 made a
strategic minority equity investment in Aurora Feint Inc, a
San Francisco-based company that
develops mobile games and operates OpenFeint, a leading mobile
social platform for iphones and smart phones. Thousands of mobile
game developers use OpenFeint and there are more than 28 million
registered users and 2,200 games live in the Apple App Store.
Management Comments:
Commenting on the first half 2010 results, Jun Zhu, Chairman and Chief Executive Officer of
The9 said, "The first half 2010 has been a meaningful and important
period to The9. We took this opportunity to restructure and
reposition The9. We now have a very clear direction to our future
business model in the global internet market. Our global strategy
includes three core tactics. First of all, we view our internet
business from a global perspective, for example, by investing in
US-based companies to enter into the global market; secondly,
regarding the domestic online game market, we will further expand
by various means including proprietary development, cooperation,
licensing etc.; thirdly, we will step into different sections in
the global internet market in respondent to new changes in the
market, including mobile internet. Although today The9 is still
making a loss, we firmly believe that as long as we implement our
global internet strategy and be innovative to changes in internet
market, we will pass through the transition period and our
financial results will be improved."
Discussion of The9's Unaudited First and Second Quarter 2010
Results
Revenues
For the first quarter of 2010, The9 reported total net revenues
were RMB22.1 million (US$3.3 million), which increased by 6% compared
to RMB20.9 million (US$3.1 million) in the fourth quarter of 2009 and
decreased by 95% compared to RMB426.2
million (US$62.8 million) in
the first quarter of 2009. The quarter-over-quarter increase in
revenues was mainly due to the commercialization of World of
Fighter in January 2010. The
year-over-year decrease was mainly due to the expiration of WoW
license in June 2009.
For the second quarter of 2010, The9 reported total net revenues
were RMB25.4 million (US$3.7 million), which increased by 15% compared
to RMB22.1 million (US$3.3 million) in the first quarter of 2010 but
decreased by 91% compared to RMB287.9
million (US$42.5 million) in
the second quarter of 2009. The quarter-over-quarter increase was
primarily due to the revenue generated from Kingdom Heroes Online 2
which was commercialized in May 2010.
The year-over-year decrease was mainly due to the expiration of WoW
license in June 2009.
Gross Profit (Loss)
Gross profit for the first quarter of 2010 was RMB1.7 million (US$0.3
million) compared to gross loss of RMB76.0 million (US$11.2
million) in the fourth quarter of 2009 and gross profit of
RMB67.9 million (US$10.0 million) in the first quarter of 2009.
Gross loss in the fourth quarter of 2009 was mainly due to the
impairment of prepaid royalties and withholding tax of certain
games amounting to RMB61.3 million
(US$9.0 million) in the fourth
quarter of 2009 while no such cost occurred in the first quarter of
2010. The year-over-year decrease was mainly due to the expiration
of WoW license in June 2009.
Gross loss for the second quarter of 2010 was RMB4.6 million (US$0.7
million) compared to gross profit of RMB1.7 million (US$0.3
million) in the first quarter of 2010 and gross profit of
RMB64.3 million (US$9.5 million) in the second quarter of 2009.
The gross loss for the second quarter was mainly due to the
impairment of prepaid royalties of a game.
Operating Expenses
For the first quarter of 2010, operating expenses were
RMB80.7 million (US$11.9 million), a 44% decrease from
RMB144.2 million (US$21.3 million) in the fourth quarter of 2009
and a 36% decrease from RMB125.1
million (US$18.4 million) in
the first quarter of 2009. The quarter-over-quarter decrease was
primarily the result of decrease in staff cost and recognition of
impairment on servers and upfront license fees for certain games
made in the fourth quarter of 2009, while there was no such
impairment in the first quarter of 2010. The year-over-year
decrease was primarily due to decrease in staff cost and
WoW-related operating expenses.
For the first quarter of 2010, share-based compensation was
RMB11.9 million (US$1.7 million), compared to RMB13.9 million (US$2.0
million) in the fourth quarter of 2009 and RMB15.7 million (US$2.3
million) in the first quarter of 2009.
For the second quarter of 2010, operating expenses were
RMB75.0 million (US$11.1 million), representing a 7% decrease from
RMB80.7 million (US$11.9 million) in the first quarter of 2010 a
51% decrease from RMB152.5 million
(US$22.5 million) in the second
quarter of 2009. The quarter-over-quarter decrease was primarily
the net result of decrease in marketing expenses due to the net
effect of decrease of World of Fighter's marketing expenses which
was partly offset by the marketing expenses for Kingdom Heroes 2
Online during the second quarter; decrease in staff cost and
increase in research and development expenses caused by
consolidation of Red5 Studios Inc. The year-over-year decrease was
primarily the net result of decrease in marketing expenses of WoW
and EA SPORTS(TM) FIFA Online 2 and decrease in staff cost; which
was partly offset by increase in research and development expenses
caused by consolidation of Red5' Studios Inc.
For the second quarter of 2010, share-based compensation was
RMB7.7 million (US$1.1 million), compared to RMB11.9 million (US$1.7
million) in the first quarter of 2010 and to RMB15.0 million (US$2.2
million) in the second quarter of 2009.
Interest Income
Interest income for the first quarter of 2010 was RMB6.4 million (US$0.9
million), compared to RMB7.4
million (US$1.1 million) in
the fourth quarter of 2009 and RMB9.0
million (US$1.3 million) in
the first quarter of 2009. The decrease of interest income was
primarily due to decrease of cash balance.
Interest income for the second quarter of 2010 was RMB5.4 million (US$0.8
million), compared to RMB6.4
million (US$0.9 million) in
the first quarter of 2010 and RMB6.9
million (US$1.0 million) in
the second quarter of 2009. The decrease of interest income was
primarily due to decrease of cash balance.
Other (Expenses) Income, net
Other expenses for the first quarter of 2010 was RMB2.2 million (US$0.3
million), compared to other income of RMB6.1 million (US$0.9
million) in the fourth quarter of 2009 and other expenses of
RMB0.4 million (US$0.1 million) in the first quarter of 2009. The
quarter-over-quarter difference was primarily due to there was a
government subsidy in the fourth quarter of 2009 while none such
subsidy was received in the first quarter of 2010. The
year-over-year increase of other expenses was primarily due to the
increase of foreign exchange loss.
Other expenses for the second quarter of 2010 was RMB1.0 million (US$0.2
million), compared to other expenses of RMB2.2 million (US$0.3
million) in the first quarter of 2010 and other income of
RMB0.1 million (US$0.01 million) in the second quarter of 2009.
The difference was primarily due to the change in foreign exchange
loss.
Net Income (Loss)
For the first quarter of 2010, net loss was RMB75.8 million (US$11.2
million), which decreased by 63% from net loss of
RMB205.5 million (US$30.3 million) in the fourth quarter of 2009
and compared with a net loss of RMB46.8
million (US$6.9 million) in
the first quarter of 2009.
Fully diluted loss per share and per ADS for the first quarter
of 2010 was RMB3.02 (US$0.44), compared with RMB8.18 (US$1.21)
in the fourth quarter of 2009 and RMB1.78 (US$0.26)
in the first quarter of 2009.
For the first quarter of 2010, non-GAAP adjusted net loss was
RMB52.7 million (US$7.8 million) compared with non-GAAP adjusted
net loss of RMB188.3 million
(US$27.8 million) for the previous
quarter and non-GAAP adjusted net income of RMB48.3 million (US$7.1
million) for the same period of last year. Fully diluted
non-GAAP adjusted net loss per share was RMB2.10 (US$0.31),
compared with non-GAAP adjusted net loss per share of RMB7.5 (US$1.11)
for the fourth quarter of 2009 and non-GAAP adjusted net income per
share of RMB1.84 (US$0.27) in the first quarter of 2009.
For the second quarter of 2010, net loss was RMB65.8 million (US$9.7
million), which decreased by 13% from net loss of
RMB75.8 million (US$11.2 million) in the first quarter of 2010 and
compared with net loss of RMB79.2
million (US$11.7 million) in
the second quarter of 2009.
Fully diluted loss per share and per ADS for the second quarter
of 2010 was RMB2.62 (US$0.39), compared with RMB3.02 (US$0.44)
in the first quarter of 2010 and RMB3.15 (US$0.46)
in the second quarter of 2009.
For the second quarter of 2010, non-GAAP adjusted net loss was
RMB48.8 million (US$7.2 million) compared with non-GAAP net loss
of RMB52.7 million (US$7.8 million) for the previous quarter and
non-GAAP adjusted net income of RMB3.1
million (US$0.5 million) for
the same period of last year. Fully diluted non-GAAP adjusted net
loss per share was RMB1.94
(US$0.29), compared with fully
diluted non-GAAP adjusted net loss of RMB2.10 (US$0.31)
for the first quarter of 2010 and fully diluted non-GAAP adjusted
net income of RMB0.12 (US$0.02) in the second quarter of 2009.
Currency Convenience Translation
The conversion of Renminbi (RMB) into US dollars (US$) in this
press release is based on the noon buying rate in the City of New York for cable transfers in
Renminbi per U.S. dollar as certified for customs purposes by the
Federal Reserve Bank of New York
as of June 30, 2010, which was
RMB6.7815 to US$1.00. The percentages
stated in this press release are calculated based on the RMB
amounts.
Use of Non-GAAP Measure
To supplement the consolidated financial statements presented in
accordance with accounting principles generally accepted in
the United States ("GAAP"), The9
uses the non-GAAP measure of non-GAAP adjusted net income, which is
adjusted from the most directly comparable financial measures
calculated and presented in accordance with GAAP to exclude certain
expenses. The non-GAAP financial measure is provided to enhance
investors' overall understanding of the Company's operating
performance.
Non-GAAP adjusted net income is defined as earnings before
depreciation of property, equipment and software, amortization of
land use right and intangibles, share-based compensation, foreign
exchange loss and income tax expenses/benefits, as applicable. The
use of non-GAAP adjusted net income has certain limitations.
Depreciation of property, equipment and software, amortization of
land use right and intangibles and income tax expenses/benefits
have been and will be incurred and are not reflected in the
presentation of non-GAAP adjusted net income. Each of these items
should also be considered in the overall evaluation of our results.
Non-GAAP adjusted net income should not be considered as a measure
of our liquidity. We compensate for these limitations by providing
the relevant disclosure of our depreciation and amortization, and
income tax expenses/benefits in our reconciliations to the GAAP
financial measure, share-based compensation and income tax
expenses/benefits in our reconciliations to the GAAP financial
measure, which should be considered when evaluating our
performance. Non-GAAP adjusted net income is not defined under
GAAP, and our non-GAAP adjusted net income is not a measure of net
income, operating income, or any operating performance measure that
is calculated in accordance with GAAP. In addition, our non-GAAP
adjusted net income may not be comparable to similarly titled
measures utilized by other companies since such other companies may
not calculate non-GAAP adjusted net income in the same manner as we
do. For more information on this non-GAAP financial measure, please
see the tables captioned "Reconciliation of GAAP to non-GAAP
results" set forth at the end of this release.
Form 20-F
On April 16, 2010, The9 filed its
annual report on Form 20-F for the year ended December 31, 2009 with the United States
Securities and Exchange Commission (SEC). The report may be
accessed in the Investor Relations section of the Company's website
at http://www.corp.the9.com. Upon request, The9 will provide a hard
copy of its annual report on Form 20-F for the year ended
December 31, 2009, which contains its
audited consolidated financial statements, free of charge, to its
shareholders. Requests should be made to The9 Limited, No. 3
Building, No. 690, Bibo Road, Pu Dong New Area, Shanghai 201203, People's Republic of China.
Conference Call / Webcast Information
The9's management team will host a conference call on
Tuesday, August 24, 2010 at
9:00 PM, U.S. Eastern Time,
corresponding to Wednesday, August 25,
2010 at 9:00 AM, Beijing Time,
to present an overview of The9's financial performance and business
operations.
Investors, analysts and other interested parties will be able to
access the live conference by calling +1-857-350-1676, password
"37936166". In the U.S., members of the financial community may
also participate in the call by dialing toll-free number
+1-866-788-0538, password "37936166". A replay of the call will be
available through September 1, 2010.
The dial-in details for the replay: U.S. toll free number
+1-888-286-8010, International dial-in number +1-617-801-6888;
Password "46865322".
The9 will also provide a live webcast of the earnings call.
Participants in the webcast should log onto the Company's Investor
Relations website http://www.corp.the9.com 15 minutes prior to the
call, then click on the icon for "The9 Limited 1Q & 2Q 2010
Earnings Conference Call" and follow the instructions.
About The9 Limited
The9 Limited is an online game operator and developer in
China. The9's business is
primarily focused on developing and operating high-quality games
for online game market. The9 directly, or through affiliates,
operates licensed MMORPGs and advanced casual games including Soul
of The Ultimate Nation(TM), Granado Espada, EA SPORTS(TM) FIFA
Online 2, Atlantica and Kingdom Heroes 2 Online, as well as its
proprietary games World of Fighter, Jiu
Zhou Zhan Ji and Winning Goal, in mainland China. It has also obtained exclusive licenses
to operate other games in mainland China, including Free Realms, Audition 2 and
others. In addition, The9 is developing various proprietary games,
including Shen Xian Zhuan and other MMORPGs and advanced causal
games.
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 press
release contain forward-looking statements. The9 may also make
written or oral forward-looking statements in its periodic reports
to the U.S. Securities and Exchange Commission on Forms 20-F and
6-K, etc., 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 The9'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, The9's
limited operating history as an online game operator, political and
economic policies of the Chinese government, the laws and
regulations governing the online game industry, information
disseminated over the Internet and Internet content providers in
China, intensified government
regulation of Internet cafes, The9's ability to retain existing
players and attract new players, license, develop or acquire
additional online games that are appealing to users, anticipate and
adapt to changing consumer preferences and respond to competitive
market conditions, and other risks and uncertainties outlined in
The9's filings with the U.S. Securities and Exchange Commission,
including its annual reports on Form 20-F. The9 does not undertake
any obligation to update any forward-looking statement, except as
required under applicable law.
For further information, please contact:
Ms. Phyllis Sai
Manager, Investor Relations
The9 Limited
Tel: +86-21-5172-9990
Email: IR@corp.the9.com
Web: http://www.corp.the9.com/
-- Tables Follow --
THE9 LIMITED
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME INFORMATION
(Expressed in Renminbi - RMB and US Dollars - US$, except share data)
Quarter Ended
March 31, June 30, December 31,
2009 2009 2009
RMB RMB RMB
Revenues:
Online game services 447,528,110 301,491,378 20,712,264
Game operating support,
website solutions and
advertisement 185,924 247,267 58,201
Other revenues 2,091,582 2,135,763 1,277,179
449,805,616 303,874,408 22,047,644
Sales Taxes (23,605,792) (15,946,899) (1,150,060)
Net Revenues 426,199,824 287,927,509 20,897,584
Cost of Services (358,312,923) (223,644,279) (96,909,129)
Gross Profit 67,886,901 64,283,230 (76,011,545)
Operating Expenses:
Product development (26,529,747) (31,125,521) (30,496,768)
Sales and marketing (35,386,080) (37,883,112) (18,539,240)
General and administrative (63,164,627) (53,257,372) (46,454,604)
Impairment of equipment,
intangible assets and
goodwill -- (30,199,751) (48,671,892)
Total operating expenses: (125,080,454) (152,465,756) (144,162,504)
Loss from operations (57,193,553) (88,182,526) (220,174,049)
Interest income 9,004,747 6,905,505 7,402,843
Other (expenses) income , net (363,129) 112,605 6,122,924
Loss before income tax expense,
gain on investment disposal,
impairment loss on investment
and share of gain (loss) in
equity investments (48,551,935) (81,164,416) (206,648,282)
Income tax (expense) benefit (697,925) -- 11,092,063
Loss before gain on investment
disposal, impairment loss
on investment and share of
gain (loss) in equity
investments (49,249,860) (81,164,416) (195,556,219)
Gain on investment disposal -- -- --
Impairment loss on investment -- -- (10,251,500)
Share of gain (loss) in equity
investments, net of taxes 141,128 (589,547) (1,429,471)
Net loss (49,108,732) (81,753,963) (207,237,190)
Less: Net loss attributable to
non-controlling interests (2,310,703) (2,560,155) (1,714,026)
Net loss attributable to
holders of ordinary shares (46,798,029) (79,193,808) (205,523,164)
Loss attributable to holders of
ordinary shares per share
- Basic (1.78) (3.15) (8.18)
- Diluted (1.78) (3.15) (8.18)
Weighted average number of
shares outstanding
- Basic 26,248,436 25,125,385 25,119,580
- Diluted 26,248,436 25,125,385 25,119,580
Amount attributable to holders
of ordinary shares (46,798,029) (79,193,808) (205,523,164)
Quarter Ended
March 31, June 30, March 31, June 30,
2010 2010 2010 2010
RMB RMB US$ US$
Revenues:
Online game
services 22,257,214 25,927,886 3,282,049 3,823,326
Game operating
support, website
solutions and
advertisement 72,842 212,756 10,741 31,373
Other revenues 1,001,408 634,601 147,668 93,578
23,331,464 26,775,243 3,440,458 3,948,277
Sales Taxes (1,214,374) (1,407,912) (179,072) (207,611)
Net Revenues 22,117,090 25,367,331 3,261,386 3,740,666
Cost of Services (20,374,564) (29,944,864) (3,004,433) (4,415,670)
Gross Profit 1,742,526 (4,577,533) 256,953 (675,004)
Operating Expenses:
Product development (27,965,714) (39,089,303) (4,123,824) (5,764,109)
Sales and marketing (18,293,758) (11,486,818) (2,697,598) (1,693,846)
General and
administrative (34,417,006) (24,434,288) (5,075,132) (3,603,080)
Impairment of
equipment,
intangible assets
and goodwill -- -- -- --
Total operating
expenses: (80,676,478) (75,010,409) (11,896,554) (11,061,035)
Loss from operations (78,933,952) (79,587,942) (11,639,601) (11,736,039)
Interest income 6,420,997 5,381,655 946,840 793,579
Other (expenses)
income , net (2,186,512) (1,036,375) (322,423) (152,824)
Loss before income
tax expense, gain on
investment disposal,
impairment loss on
investment and share
of gain (loss) in
equity investments (74,699,467) (75,242,662) (11,015,184) (11,095,284)
Income tax (expense)
benefit (186) (3,074) (27) (453)
Loss before gain on
investment disposal,
impairment loss
on investment and
share of gain
(loss) in equity
investments (74,699,653) (75,245,736) (11,015,211) (11,095,737)
Gain on investment
disposal -- 6,827,900 -- 1,006,842
Impairment loss on
investment -- -- -- --
Share of gain (loss)
in equity
investments, net
of taxes (4,400,847) (1,933,730) (648,949) (285,148)
Net loss (79,100,500) (70,351,566) (11,664,160) (10,374,043)
Less: Net loss
attributable to
non-controlling
interests (3,297,940) (4,533,331) (486,314) (668,485)
Net loss attributable
to holders of
ordinary shares (75,802,560) (65,818,235) (11,177,846) (9,705,558)
Loss attributable to
holders of ordinary
shares per share
- Basic (3.02) (2.62) (0.44) (0.39)
- Diluted (3.02) (2.62) (0.44) (0.39)
Weighted average
number of shares
outstanding
- Basic 25,121,645 25,121,645 25,121,645 25,121,645
- Diluted 25,121,645 25,121,645 25,121,645 25,121,645
Amount attributable
to holders of
ordinary shares (75,802,560) (65,818,235) (11,177,846) (9,705,558)
THE9 LIMITED
CONSOLIDATED BALANCE SHEETS INFORMATION
(Expressed in Renminbi - RMB and US Dollars - US$)
As at
December 31, March 31, June 30,
2009 2010 2010
RMB RMB RMB
(audited) (unaudited) (unaudited)
Assets
Current Assets
Cash and cash equivalents 1,675,081,345 1,593,394,831 1,546,286,233
Accounts receivable 920,214 3,444,115 6,565,038
Due from related parties 1,110,424 1,190,827 1,638,483
Advances to suppliers 44,132,089 45,887,841 46,305,066
Prepayments and other
current assets 77,896,385 68,874,882 44,528,651
Deferred costs 1,516,601 382,731 1,524,202
Deferred tax assets,
current 2,139,896 2,139,896 2,139,896
Total current assets 1,802,796,954 1,715,315,123 1,648,987,569
Investments in equity
investees 308,806,125 304,405,279 302,471,549
Property, equipment and
software 75,977,200 73,280,955 73,397,619
Goodwill -- -- 92,210,971
Intangible assets 51,628,286 49,719,693 254,009,369
Land use right 79,877,847 79,397,618 78,917,391
Other long-term assets 603,910 19,992,590 23,181,949
Deferred tax assets, non-
current 5,267,185 5,267,185 5,267,185
Total Assets 2,324,957,507 2,247,378,443 2,478,443,602
Liabilities and Shareholders'
Equity
Current Liabilities
Accounts payable 35,013,675 39,561,710 59,132,971
Income tax payable 29,947 30,117 (49,156)
Other taxes payable 6,270,518 4,016,648 7,932,670
Advances from customers 11,154,437 8,287,165 7,274,723
Deferred revenue, current 10,933,464 12,727,576 15,920,115
Refund of game points 196,401,440 196,377,615 196,366,637
Other payables and accruals 51,704,425 40,083,773 37,242,776
Total current liabilities 311,507,906 301,084,604 323,820,736
Deferred revenue, non-current -- -- 167,503,050
Deferred tax liabilities,
non-current -- -- 81,757,764
Total Liabilities 311,507,906 301,084,604 573,081,550
Equity
Common shares (US$0.01 par
value; 25,121,645 shares
issued and outstanding
as of December 31, 2009,
March 31, 2010 and
June 30, 2010) 2,051,712 2,051,712 2,051,712
Additional paid-in capital 2,069,616,975 2,081,349,451 2,085,665,452
Statutory reserves 28,071,982 28,071,982 28,071,982
Accumulated other
comprehensive income -- -- (681,640)
Retained deficit (88,364,685) (164,167,245) (229,985,480)
Total The9 Limited
shareholders' equity 2,011,375,984 1,947,305,900 1,885,122,026
Non-controlling interests 2,073,617 (1,012,061) 20,240,026
Total equity 2,013,449,601 1,946,293,839 1,905,362,052
Total liabilities and equity 2,324,957,507 2,247,378,443 2,478,443,602
As at
March 31, 2010 June 30, 2010
US$ US$
(unaudited) (unaudited)
Assets
Current Assets
Cash and cash equivalents 234,962,003 228,015,370
Accounts receivable 507,869 968,081
Due from related parties 175,599 241,611
Advances to suppliers 6,766,621 6,828,145
Prepayments and other current
assets 10,156,290 6,566,195
Deferred costs 56,438 224,759
Deferred tax assets, current 315,549 315,549
Total current assets 252,940,369 243,159,710
Investments in equity investees 44,887,603 44,602,455
Property, equipment and software 10,806,010 10,823,213
Goodwill -- 13,597,430
Intangible assets 7,331,666 37,456,222
Land use right 11,707,973 11,637,159
Other long-term assets 2,948,107 3,418,410
Deferred tax assets, non-current 776,699 776,699
Total Assets 331,398,427 365,471,298
Liabilities and Shareholders' Equity
Current Liabilities
Accounts payable 5,833,770 8,719,748
Income tax payable 4,441 (7,249)
Other taxes payable 592,295 1,169,752
Advances from customers 1,222,025 1,072,731
Deferred revenue, current 1,876,808 2,347,580
Refund of game points 28,957,843 28,956,225
Other payables and accruals 5,910,753 5,491,820
Total current liabilities 44,397,935 47,750,607
Deferred revenue, non-current -- 24,700,000
Deferred tax liabilities, non-current -- 12,056,000
Total Liabilities 44,397,935 84,506,607
Equity
Common shares (US$0.01 par value;
25,121,645 shares issued and
outstanding as of December 31,
2009, March 31, 2010 and
June 30, 2010) 302,545 302,545
Additional paid-in capital 306,915,793 307,552,231
Statutory reserves 4,139,495 4,139,495
Accumulated other comprehensive
income -- (100,515)
Retained deficit (24,208,102) (33,913,659)
Total The9 Limited shareholders'
equity 287,149,731 277,980,097
Non-controlling interests (149,239) 2,984,594
Total equity 287,000,492 280,964,691
Total liabilities and equity 331,398,427 365,471,298
THE9 LIMITED
RECONCILIATION OF GAAP TO NON-GAAP RESULTS
(Expressed in Renminbi - RMB and US Dollars - US$, except share data)
Quarter Ended
March 31, June 30, December 31,
2009 2009 2009
RMB RMB RMB
(unaudited) (unaudited) (unaudited)
GAAP net income (loss) (46,798,029) (79,193,808) (205,523,164)
Depreciation of property,
equipment 54,278,555 48,379,270 11,749,761
Amortization of land use right and
intangible assets 24,050,296 19,046,925 2,626,562
Share based compensation 15,668,139 15,016,684 13,855,861
Foreign exchange loss (gain) 388,210 (114,679) 102,801
Income tax expense 697,925 -- (11,092,063)
Non-GAAP net income (loss) 48,285,096 3,134,392 (188,280,242)
GAAP earnings (loss) per share
- Basic (1.78) (3.15) (8.18)
- Diluted (1.78) (3.15) (8.18)
Non-GAAP net income (loss) per
share
- Basic 1.84 0.12 (7.50)
- Diluted 1.84 0.12 (7.50)
Weighted average shares
outstanding
- Basic 26,248,436 25,125,385 25,119,580
- Diluted 26,248,436 25,125,385 25,119,580
Quarter Ended
March 31, June 30, March 31, June 30,
2010 2010 2010 2010
RMB RMB US$ US$
(unaudited) (unaudited) (unaudited) (unaudited)
GAAP net income (loss) (75,802,560) (65,818,235) (11,177,846) (9,705,557)
Depreciation of
property, equipment 5,800,844 5,639,745 855,392 831,637
Amortization of land
use right and
intangible assets 2,388,821 3,163,302 352,256 466,461
Share based
compensation 11,857,238 7,650,882 1,748,468 1,128,199
Foreign exchange loss
(gain) 3,019,687 601,233 445,283 88,658
Income tax expense 186 3,074 27 453
Non-GAAP net income
(loss) (52,735,784) (48,759,999) (7,776,420) (7,190,149)
GAAP earnings (loss)
per share
- Basic (3.02) (2.62) (0.44) (0.39)
- Diluted (3.02) (2.62) (0.44) (0.39)
Non-GAAP net income
(loss) per share
- Basic (2.10) (1.94) (0.31) (0.29)
- Diluted (2.10) (1.94) (0.31) (0.29)
Weighted average shares
outstanding
- Basic 25,121,645 25,121,645 25,121,645 25,121,645
- Diluted 25,121,645 25,121,645 25,121,645 25,121,645
SOURCE The9 Limited
Copyright . 24 PR Newswire