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MediaRing posts 2nd Consecutive Half-Year Profits |
• Revenue almost doubled to US$44.4m
• Net profit of US$1.2m vs loss of US$1.1m in 1H 2004
• Strong growth seen in core VoIP services
• Half-year call traffic volume up by 55% to 474 million minutes
US$’million |
6 mths ended 30 June 2005
(1H 2005) |
6 mths ended 30 June 2004
(1H 2004) |
% Change |
Revenue |
44.4 |
23.3 |
+91 |
Operating Profit |
0.8 |
(1.5) |
NM |
Net Profit |
1.2 |
(1.1) |
NM |
EPS (US cent) |
0.16 |
(0.14) |
NM |
SINGAPORE – [ ·] August 2005 – Mainboard-listed MediaRing Limited (“MediaRing” or the “Group”), the leader of pure-play VoIP telephony service providers in Asia continues its profitability trend.
For the six months ended 30 June 2005, the Group achieved a net profit of US$1.2 million driven by strong growth in revenue.
During the period under review, Group revenue surged 91% to US$44.4 million from US$23.3 million in 1H 2004, mainly due to continued strong growth in its VoIP retail operations.
Said an elated Mr Khaw Kheng Joo, Chief Executive Officer of MediaRing Limited, “Without a doubt, this continued trend of profitability is a major success to date. Our financial recovery is a resounding validation of the strength of our business model, the soundness of our growth strategies and the calibre of the people at MediaRing.”
Based on the latest results, earnings per share and net asset value per share based on the issued and fully paid up share capital of 751,302,398 ordinary shares for 1H 2005 were 0.16 US cents and 3.83 US cents respectively.
Riding on the rapid growth in the VoIP industry, the Group’s performance was boosted in 1H 2005 by its VoIP retail operations which grew 144% to US$38.3 million from US$15.7 million in the same period last year.
The Group’s call traffic rose 55% to 474 million minutes in 1H 2005 from 305 million minutes in 1H 2004. The Group generated more than 80 million minutes of call traffic a month since March 2005. Of this, VoIP call traffic accounted for 96%.
The Group further expanded its marketing and distribution network to more than 1,200 resellers and partners in over 100 countries as compared to approximately 950 and 1,100 in over 90 countries for 1H 2004 and full year 2004 respectively.
“Our VoIP retail services, which comprised 86% of the first half-year revenue continues to grow at a significant pace. We continue to do well in our key markets in the Middle East and Indochina and are starting to see our efforts in opening up of the South American market taking hold.” Mr Khaw explained.
Key Expenditures
In 1H 2005, all categories of expenses for the Group increased as a result of the substantial growth in revenue. While direct service fees and selling expenses increased in tandem with revenue growth, the other operating expenses increased at a much slower pace reflecting the increased economies of scale associated with revenue growth.
Conversion of functional currency and reporting currency to US Dollars
With effect from 1 January 2005, the Company adopted FRS 21 (revised) : The Effects of Changes in Foreign Exchange Rates. With this revision of FRS 21 (revised), the Board reviewed the choice of functional currency for the Company. As sales and purchases are denominated primarily in US Dollars and net receipts from operations are usually retained in US Dollars, the directors are of the opinion that choosing the US Dollars as the functional currency best reflects the economic substance of the underlying activities of the Company and are also in line with FRS 21 (revised). Hence the Company changed its functional and presentation currency from Singapore Dollars to US Dollars. The effect of adopting FRS 21 led to retrospective changes made to the financials for comparative purposes.
Outlook
With the attainment of its 2 nd consecutive half-year profits and the anticipated continued growth of VoIP, the Group is confident about the business outlook in 2005.
“We have made steady progress in growing our share of the global VoIP market over the past years and MediaRing continues to be the leading company in the pure-play VoIP market outside the US. With increasing market adoption of this technology and public recognition of the many benefits it brings to consumers and businesses alike, we are confident of our growth prospects.” said Mr Khaw.
Barring any unforeseen circumstances, the Group believes it will be able to continue to grow existing revenue streams and further improve financial performance in 2H 2005.
About MediaRing
With offices in Singapore, Malaysia, Shanghai, Beijing, Hong Kong, Taiwan, Japan and Sunnyvale (USA), MediaRing is the leading VoIP telephony service provider in Asia and enjoys a significant share of the global pure-play VoIP market. Through its strong technological capabilities and extensive distribution network, MediaRing brings high-quality voice services to carriers, enterprises, service providers, and consumers with its wide range of service offerings. Its extensive partnerships with carriers around the world allow call terminations in more than 240 countries worldwide. As a pioneer in VoIP services with unique proprietary technology, MediaRing derives more than 90 per cent of its revenue from outside Singapore.
MediaRing recently announced that it has entered into a placement agreement worth US$24.1m with Venture One Finance Limited. Venture One Finance Limited subscribed up to an aggregate of 150.33million new shares which represented approximately 20% of the capital of MediaRing. Venture One is a company incorporated in the British Virgin Islands.
Public Relations Contact
For further information please contact:
August Consulting
Tel: 6733 8873 Fax: 6733 9913
Silvia HENG- silvia@august.com.sg
Lynn Ll- lynn@august.com.sg
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