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Fri, May 15, 2009 China INSOnline Corp.: China INSOnline Reports 2009 Third Quarter Net Income Grew 36% on a 24% Increase in Net Revenues
BEIJING--(Marketwire - May 15, 2009) - China INSOnline Corp. (
According to the Company -- a rapidly growing integrated licensed insurance service provider, which operates [ www.soobao.cn ], one of China's leading insurance services web portals -- the main driver of growth in the quarter was a doubling of sales achieved by the completion of projects in its software development business which translated to revenues of approximately $1.32 million, or about 32% of total revenues in the period.
The Company said the revenue contribution from online insurance advertising, while up significantly year to date, was about flat in the fiscal 2009 third quarter compared with the third quarter last year. Online advertising nevertheless contributed about 66% of total sales in the quarter, while costs of the business remained stable. The Company said these results were primarily due to the non-renewal of some insurance agent contracts in the period, explaining that advertising sales are generated by the number of insurance agents that place advertisements on the Company's website.
During the quarter the Company also saw a small decline in the contribution from insurance agency operations, primarily due to prevailing economic conditions.
Nine Month Net Revenues Were up 54%; Net Income Declined 4%
In the nine months ended March 31, 2009, net revenues rose 54% to $13,047,434 from $8,469,275 in the same period in fiscal 2008. The Company said this was mainly on the strength of online insurance advertising sales which rose 67% from the year earlier period to approximately $9.8 million, representing 73% of the Company's year to date total revenues. In the first nine months of fiscal 2009, the number of teams of insurance agents that placed ads rose to 76 from 50 a year earlier, and 186 ad contracts were in place in the first nine months of fiscal 2009 compared with 134 in the same period in the prior fiscal year.
Gross profit in the first nine months of fiscal 2009 rose 56% to approximately $11.9 million compared to approximately $7.6 million in the prior year period. In the second quarter this year the Company recorded a $934,987 provision for doubtful accounts which it did not add to in the third quarter. The second quarter also included expenses from the launch in late 2008 of an advertising campaign, which through the end of the third quarter totaled approximately $1.9 million. Mainly due to these expenses, as well as an approximately $661,000 increase in income taxes, net income in the fiscal 2009 nine month period was down about 4% to $5,447,822 compared with $5,648,389 in the same period last year. Reflecting an increase in average weighted shares outstanding at the end of the 2009 third quarter to 40,000,000, from 31,096,530 in the same period last year, nine month EPS was $0.14 in fiscal 2009, compared with $0.18 in the prior year nine month period.
Outlook
Ms. Betty Xu, CEO of China INSOnline, commented, "We continue to remain focused on our goal of making [ www.soobao.cn ] the premier site for insurance advertisers and a growing source of insurance sales commissions by developing it into the largest network portal in China's insurance industry. This requires an ongoing effort to popularize the site in all key first and second tier cities throughout the country. At the same time, we are continuing to build our technical know-how and to commit the necessary resources to accomplish this, as reflected in part in our software system purchases so far this year."
Mr. Zhenyu Wang, Chairman of the Company, stated, "We continue to be aware of potential effects of the overall economic situation and have made what we believe are appropriate adjustments to optimize our performance. While our initial focus has been on online auto insurance, where we continue to expand our value-added services offerings, we will expand our property and life offerings more gradually. Pursuing our growth strategy, we also are focused on growing a comprehensive chain insurance supermarket entity to supplement the function and effect of our [ www.soobao.cn ] portal."
About China INSOnline Corp.
China INSOnline Corp., incorporated in Delaware and headquartered in Beijing, is a rapidly growing licensed insurance agency in The People's Republic of China. Representing major insurance underwriting firms in China, the Company offers online automobile, property and life insurance services through its industry web portal, [ www.soobao.cn ]. The Company's online platform also provides consumers, agents and insurance companies with online transaction capabilities, advertising, online inquiry, news circulation, statistical analysis and software development services. For more information, please visit [ www.china-insonline.com ].
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995:
This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current expectations or beliefs, including, but not limited to, statements concerning the Company's operations, financial performance and condition. For this purpose, statements that are not statements of historical fact may be deemed to be forward-looking statements. The Company cautions that these statements by their nature involve risks and uncertainties, and actual results may differ materially depending on a variety of important factors, including, but not limited to, the impact of competitive products, pricing and new technology; changes in consumer preferences and tastes; and effectiveness of marketing; changes in laws and regulations; fluctuations in costs of production, and other factors as those discussed in the Company's reports filed with the Securities and Exchange Commission from time to time. In addition, the Company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date hereof.
CHINA INSONLINE CORP. (FORMERLY KNOWN AS DEXTERITY SURGICAL, INC.) AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (UNAUDITED) Three Months Ended Nine Months Ended March 31, March 31, ------------------------ -------------------------- 2009 2008 2009 2008 ----------- ------------ ------------ ------------ REVENUES, NET $ 3,989,716 $ 3,230,301 $ 13,047,434 $ 8,469,275 COST OF SALES 390,206 623,033 1,182,668 845,866 ----------- ------------ ------------ ------------ GROSS PROFIT 3,599,510 2,607,268 11,864,766 7,623,409 Selling expenses 62,082 43,185 228,409 99,128 Advertising expenses 90 - 1,906,559 - General and administrative expenses 558,814 262,335 1,299,047 477,297 Provision for doubtful accounts - - 934,987 - ----------- ------------ ------------ ------------ INCOME FROM OPERATIONS 2,978,524 2,301,748 7,495,764 7,046,984 ----------- ------------ ------------ ------------ Financial income, net 1,448 6,289 24,332 12,764 ----------- ------------ ------------ ------------ INCOME FROM OPERATIONS BEFORE INCOME TAXES 2,979,972 2,308,037 7,520,096 7,059,748 Income taxes 785,778 697,851 2,072,274 1,411,359 ----------- ------------ ------------ ------------ NET INCOME 2,194,194 1,610,186 5,447,822 5,648,389 OTHER COMPREHENSIVE INCOME Foreign currency translation (loss)/gain (10,681) 374,563 14,149 560,144 ----------- ------------ ------------ ------------ COMPREHENSIVE INCOME $ 2,183,513 $ 1,984,749 $ 5,461,971 $ 6,208,533 =========== ============ ============ ============ NET INCOME PER SHARE - BASIC AND DILUTED $ 0.05 $ 0.04 $ 0.14 $ 0.18 =========== ============ ============ ============ WEIGHTED AVERAGE SHARES OUTSTANDING - BASIC AND DILUTED 40,000,000 39,961,882 40,000,000 31,096,530 =========== ============ ============ ============
