Months after announcing that its once-lucrative LCD display advertising business was being sold to Chinese Internet firm Sina.com, Focus Media Holding Limited has announced its unaudited financial results for the first quarter ended March 31, 2009.
On December 22, 2008, Focus Media announced that it entered into a definitive agreement with Sina Corporation to sell substantially all of the assets of Focus Media's digital out-of-home advertising networks, including the LCD display network, poster frame network and certain in-store networks.
Net revenue for continuing operations, which do not include the assets and businesses being sold to Sina.com, was USD66.7 million, declining 24% from USD87.2 million for the fourth quarter of 2008 and declining 14% from USD78.0 million for the first quarter of 2008. Net revenue for discontinued operations, which correspond only to the businesses being sold to Sina.com, was USD64.4 million, a sequential decrease of 39% from USD104.9 million for the fourth quarter of 2008 and decrease of 23% from USD83.6 million for the first quarter of 2008 and slightly below the company's previous guidance of no less than USD65.7 million.
Net loss from continuing operations was USD17.7 million, compared to net loss from continuing operations of USD424.5 million for the fourth quarter of 2008 and net income from continuing operations of USD1.0 million for the first quarter of 2008. Net income from discontinued operations, which are the assets to be sold to Sina.com, was USD12.0 million, compared to net loss from discontinued operations of USD380.3 million for the fourth quarter of 2008 and net loss from discontinued operations of USD54.6 million for the first quarter of 2008.
In a statement, Focus Media says it has decided to cease expansion of its digital poster frame network in light of uncertain demand for its advertising services, and, most importantly, the company says it does not expect to renew the expansion of its digital poster frame network in the predictable future. The company also plans to cease operation of a boat it owns in Shanghai that is used as a garish advertising platform on the Huangpu River in compliance to a rule promulgated by Shanghai Municipal Government. The net book value of the boat is USD12.4 million.
