PRESS RELEASE
The Chairman and Chief Executive Officer of Phoenix Satellite Television Holdings Limited, Mr. Liu Changle, said today that he had a positive view of the Group's long-term prospects, as it increased the coordination between program production and advertising and continued to expanded its business model to include a popular new media business. While the recent slowing down of the economy had decreased the Group's income, he was confident that the strategy Phoenix had followed over the years would ensure that the Group remained successful. Boosted by the non-cash revaluation gain of new media's investment in Particle Inc., the profit attributable to owners of the Company was approximately HK$230 million. The Group's revenue for 2016 was approximately HK$3,798,273,000, while operating profit for the year was approximately HK$181,130,000. The Board recommended a final dividend of 1 Hong Kong cent per ordinary share of the Company.
FINANCIAL REVIEW
The revenue of Phoenix Satellite Television Holdings Limited (the "Company") and its subsidiaries (the "Group" or "Phoenix") for the year ended 31 December 2016 was approximately HK$3,798,273,000 (year ended 31 December 2015: HK$4,200,895,000), which represented a 9.6% decrease over the previous year. The slowdown of the Chinese economy and depreciation of the Renminbi have had a negative effect on Phoenix's overall revenue. The operating costs have decreased by 6.9% to approximately HK$3,617,143,000 (year ended 31 December 2015: HK$3,886,425,000).
The operating profit of the Group for the year ended 31 December 2016 was approximately HK$181,130,000 (year ended 31 December 2015: HK$314,470,000), which represented a decrease of 42.4% compared to the previous year.
The profit attributable to owners of the Company was approximately HK$230,515,000 (year ended 31 December 2015: HK$110,349,000), which represented an increase of 108.9% compared to the previous year. New media's investment in Particle Inc. had resulted in a substantial revaluation gain in the current year which boosted our profit at group level.
The chart below summarises the performance of the Group for the year ended 31 December 2016 and the year ended 31 December 2015 respectively.
Comments on Segmental Information
Revenue from television broadcasting, comprising of advertising, subscription and other revenue sources, which accounted for 37.7% of the total revenue of the Group for the year ended 31 December 2016, decreased by 10.5% to approximately HK$1,430,947,000 (year ended 31 December 2015: HK$1,598,095,000). The decline in the demand for luxury goods in China has led to a decrease in the advertising income of the television broadcasting business. Due to the relatively fixed cost structure, the segmental profit for the television broadcasting business decreased to approximately HK$417,619,000 for the year ended 31 December 2016 (year ended 31 December 2015 HK$521,704,000).
Revenue from Phoenix Chinese Channel and Phoenix InfoNews Channel, which accounted for 34.5% of the total revenue of the Group for the year ended 31 December 2016, decreased by 9.7% to approximately HK$1,310,632,000 (year ended 31 December 2015: HK$1,451,302,000).
The total revenue of Phoenix Hong Kong Channel, Phoenix Movies Channel, Phoenix North America Chinese Channel, Phoenix Chinese News and Entertainment Channel and others decreased by 18% as compared to the previous year to approximately HK$120,315,000 (year ended 31 December 2015: HK$146,793,000).
The revenue of the new media business for the year ended 31 December 2016 decreased by 15.2% to approximately HK$1,629,661,000 (year ended 31 December 2015: HK$1,920,708,000) due to the decrease in mobile value-added services resulting from the decrease in user demands. The segmental profit of new media business for the year ended 31 December 2016 increased by 153.3% to approximately HK$389,113,000 (year ended 31 December 2015: HK$153,634,000). Increase in segmental profit was primarily due to increase in net gain related to subsequent measurement of the investment in Particle Inc. to HK$283,661,000 for the year ended 31 December 2016 from HK$11,348,000 for the year ended 31 December 2015.
The revenue of outdoor media business for the year ended 31 December 2016 increased by 6.8% to approximately HK$610,295,000 (year ended 31 December 2015: HK$571,521,000). The segmental profit of outdoor media business for the year ended 31 December 2016 increased by 5.5% to approximately HK$67,283,000 (year ended 31 December 2015: HK$63,806,000).
The segmental loss for real estate for the year ended 31 December 2016 was approximately HK$47,251,000 (year ended 31 December 2015: segmental profit of HK$1,106,000), which mainly comprises of depreciation and interest expenses. The segmental result for real estate had turned a profit into loss primarily due to a decrease of fair value gain for the investment properties to approximately HK$21,127,000 (year ended 31 December 2015: HK$98,939,000), recognized during the year.
For more information, please visit http://doc.irasia.com/listco/hk/phoenixtv/annual/2016/respress.pdf.
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