HONG KONG, May 25, 2010 - (ACN Newswire) - Kingsoft Corporation Limited ("Kingsoft" or the "Company"; SEHK stock code: 3888), a leading developer, distributor and service provider of applications and entertainment software in China, announced its unaudited first quarter results for the three months ended March 31, 2010.
Financial Highlight
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RMB'000 For the 3 months ended March 31 Change
(Unaudited) (%)
2010 2009
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Revenue 245,698 236,228 4
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-Entertainment software 161,742 162,804 (1)
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-Applications software 82,233 72,030 14
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-Others 1,723 1,394 24
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Gross profit 214,931 206,910 4
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Operational Highlights
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March 31 December 31 March 31
2010 2009 2009
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Online Games
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-Daily Average Peak Concurrent Users 915,212 1,131,124 951,685
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-Monthly Average Paying Users 1,457,101 1,767,553 1,489,797
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-Monthly Average Revenue per
Paying User(RMB) 36 38 36
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Online Services of Internet securities
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-Daily Average Paying Users 8,416,136 8,746,468 8,450,146
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-Monthly Average Revenue per
Paying Users(RMB) 2.0 2.1 1.9
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During the period under review, Kingsoft recorded continuous growth in both revenue and profit compared with the corresponding period last year. Revenue increased by 4% year-over-year to RMB 245.7 million and gross profit increased by 4% year-over-year to RMB214.9 million.
The Company continued to impose stringent cost control measures. Selling and distribution expenses decreased by 6% year-over-year to RMB 27.4 million during the period under review. As at March 31, 2010, cash and cash equivalent amounted to RMB 1,314 million, and gearing ratio decreased 3 percentage points quarter-over-quarter to 18%.
Business Review
Revenue from the entertainment software business and the applications software business represented 66% and 33% respectively of total revenue in the first quarter.
Entertainment Software Business
Revenue from the entertainment software business slightly decreased by 1% year-over-year to RMB 161.7 million. Daily average peak concurrent users slightly decreased by 4% year-over-year to 0.9 million. Monthly average paying users also slightly dropped by 2% year-over-year to 1.5 million. The monthly average revenue per paying user ("monthly ARPU") for the Company's online games held flat year-over-year to RMB 36. The decrease in the first quarter was mainly due to the stronger than expected seasonality and increased level of competition.
The Company has strengthened its online game operating capacity by introducing high-end talents. In April it has signed a cooperation agreement with Game Flier International Corp., granting it the right of operating JX World Online in Hong Kong, Macau and Taiwan. The game is expected to be launched in the second quarter of 2010.The company will continue to enhance its R&D workforce, and plans to release up to 10 self-developed online games this year.
Applications Software Business
Revenue from the applications software business increased by 14% year-over-year to RMB 82.2 million. The daily average paying users for online services of Kingsoft Internet Security reached 8.4 million, which is similar to that of the first quarter of 2009. Monthly ARPU for online services of Kingsoft Internet Security business increased by 5% year-over-year to RMB 2.0.
The Company has made progress in expanding its applications software business. Kingsoft has signed a cooperation agreement with Asiasoft, the largest online game operator in Thailand, to launch the Thai version of its anti-virus software product, Kingsoft Internet Security (Thai Edition), in Thailand. Kingsoft also debuted its free internet security software Kingsoft Defender in March 2010.
In a major advance of Kingsoft's corporate strategy, Beijing Kingsoft Security Software Co., Ltd was established in April 2010. The new subsidiary is to focus on in-depth development of Internet security software series, one of the Company's major profitable product lines. Meanwhile, Kingsoft Internet Security 2011, the leading cloud anti-virus software in China, has been officially launched.
Outlook
Looking ahead, Kingsoft remains optimistic about the growing momentum in both entertainment software and applications software businesses. Mr. Pak Kwan Kau, Chairman and Chief Executive Officer of Kingsoft, said, "In the first quarter, our game revenue was negatively impacted by stronger than expected seasonality and increased level of competition. However, we believe that by launching new expansion packs for JX3 and JX World in the second quarter and new titles, such as First Myth 3 and Legend of Moon and others in the second half of the year, we will continue to grow our top line. On the other hand, our applications software continues to benefit from the substantial progress of copyright protection and the PRC government's favorable policies to local software developers and sees increasing demand from the domestic market. Following our successful entrance into Asian markets such as Japan. Vienam, Taiwan, Singapore, Malaysia and Thailand, we are aiming at expanding our market reach into North America and Europe. By leveraging our strength in R&D and our successful experience, we will make every effort to bring the best products to users and to optimize the Company's profitability."
Contact:
Kingsoft Corporation Limited
Ms. Michelle Feng Harnett
Tel: (86) 10 82325515
Email: ir@kingsoft.com
Ms. Claire Lee
Tel: (86) 10 82334488 - 5850
Email: limiao@kingsoft.com
Topic: Press release summary
Source: Kingsoft Corporation Limited
Sectors: Daily Finance, IT Individual, eSports, Gaming
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