◆NowNews Digital Media Technology Reports FY 2015 Financial Results
Taipei City, Taiwan, April 1, 2016-- NowNews Digital Media Technology Co. Ltd. (“NowNews” or “the Company”) (OTCQB: NDMT), a new media company that provides news, information, and multimedia platform service, released its financial results of the fiscal year ended December 31, 2015.
Fiscal Year 2015 Highlights
• Gross margin was 40% for the year ended December 31, 2015 as compared to 38% for the prior year.
“We have effectively executed on our business strategy by signing letter of intent with Beijing New Tong Ying Culture Media Co., Ltd and signing an agreement with Mr. Science during the year of 2015 , augmenting our services and expanding the business, which would lead up to a strategic transformation” said Alan Chen, Chairman of the Company.
“This year we are still keeping our focus on strategic transformation and looking to establish more cooperation with other media platforms to increase our international presence” said Shuo-Wei Shih, CEO of the Company.
Fiscal Year 2015 Results
For the fiscal year 2015, NowNews reported net revenue of $2.46 million, a decrease of 16% from $2.93 million for the year 2014. The decrease was primarily due to the decrease in licensing and services revenue and E-commerce revenue and advertisement revenue.
During the fiscal year ended December 31, 2015, the revenue from advertising was $2.27 million, a decrease of 4% from $2.36 million for the year ended December 31, 2014. The Company continues focus on the internet advertising and marketing business.
Revenue from content licensing was $0.19 million for the year ended December 31, 2015, a decrease of 37% from $0.30 million for the year ended December 31, 2014. The decrease was primarily due to the termination of low-profit news editing services to Yahoo Taiwan. Such services were supplementary to the Company’s licensing arrangements with them.
Revenue from E-commerce was $2,117 for the year ended December 31, 2015. The Company terminated this business at the end of 2015.
Cost of Revenue
Cost of revenue was $1.47 million for the year ended December 31, 2015, compared to $1.82 million for the year ended December 31, 2014, a decrease of $0.35 million, or 19%. The decrease was mainly due to a decrease of $0.23 million in cost of goods sold in E-commerce and $0.10 million in advertisement cost.
Gross profit decreased approximately $0.13 million, a decrease of 12% as compared to last year due to the substantial decrease in net revenue. Gross profit margin was 40% for the year ended December 31, 2015 as compared to 38% for the prior year.
Selling expenses decreased by 16% from $0.61 million for the year ended December 31, 2014 to $0.51 million for the year ended December 31, 2015. The decrease in selling expenses was primarily due to the decrease in labor costs resulting from the decrease in the number of salespersons.
General and Administrative Expenses
General and administrative expenses decreased by 28% from $1.38 million for the year ended December 31, 2014 to $1.00 million for the year ended December 31, 2015. The decrease in general and administration expenses was principally due to the decrease in payroll resulting from reduction in the number of employees.
Interest expense for the year ended December 31, 2015 was $4,337 compared to $25,103 for the year ended December 31, 2014, a decrease of 83%. The decrease in interest expense was primarily due to reduced bank loans incurred for the year ended December 31, 2015 as compared with the year ended December 31, 2014 as the Company repaid the bank loans in full in February, 2015.
As a result of the above factors, the Company has net loss of approximately $0.59 million for the year ended December 31, 2015 as compared to net loss of approximately $0.91 million for the year ended December 31, 2014, representing a decrease of loss of approximately $0.32 million or approximately 35%.
Cash, Liquidity and Financial Position
As of December 31, 2015, cash and cash equivalents were $0.30 million, compared to $0.07 million at the end of 2014. The Company had a working capital deficit of $0.50 million at December 31, 2015, with $0.84 million of current assets and $1.34 million of current liabilities. The Company believes it can successfully secure financing to meet all working capital and capital expenditure needs for the next twelve months. However, there can be no guarantee that the Company will succeed in raising additional financing.
About NowNews Digital Media Technology Co. Ltd.
NowNews Digital Media Technology Co. Ltd. (OTCQB: NDMT) is a U.S.-listed holding company, through its subsidiaries, engaging in creating, collecting and distributing news and information through its website and applications on mobile phones or tablets. NowNews is also the largest online self-produced news content provider of Taiwan and the only Taiwanese online news website fully accessible in Mainland China. After launched Professional Category news brands, we launched Nownews Mobile Web and Apps. In July 2013, Nownews launched a new concept newspaper “NOWnews”, which is the first O2O case in Taiwan. Nownews owns a great amount of brands, such as the largest online self-produced news content provider「NOWnews」, the biggest Citizen Journalist platform「WEnews」, online video shopping website「NOWshopping」, etc. Its partners include CCTV, Yahoo, MSN, Hinet, Yam, Sina and other telecoms operators.
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