Visionchina Media, Inc. :VISN-US: Earnings Analysis: Q3, 2016 By the Numbers : January 17, 2017

Visionchina Media, Inc. reports financial results for the quarter ended September 30, 2016.

Highlights

  • Summary numbers: Revenues of USD 12.53 million, Net Earnings of USD -0.37 million.
  • Gross margins widened from -58.78% to 9.44% compared to the same period last year, operating (EBITDA) margins now -18.58% from -108.02%.
  • Earnings growth from operating margin improvements as well as one-time items.

The table below shows the preliminary results and recent trends for key metrics such as revenues and net income growth:

2016-09-30 2015-09-30 2015-06-30 2015-03-31 2014-12-31
Relevant Numbers (Quarterly)
Revenues (mil) 12.53 22.9 23.12 15.21 21.62
Revenue Growth (%YOY) -42.04 -22.57 -22.8 -30.85 -34.17
Earnings (mil) -0.37 -4.93 -0.15 -8.41 -23.15
Earnings Growth (%YOY) 98.4 -72.5 -106.46 -13 -17845.73
Net Margin (%) -2.96 -21.54 -0.66 -55.3 -107.07
EPS 0.2 -0.99 -0.03 -1.59 -4.59
Return on Equity (%) -8.62 N/A N/A N/A -6829.54
Return on Assets (%) -1.05 -18.82 -0.59 -33.56 -82.42

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Market Share Versus Profits

Revenues History
Earnings History

Compared to the same period last year, VISN-US‘s change in revenue was close to the amount of its change in earnings. It remains to be seen how the rest of its peer group’s results will turn out and if VISN-US‘s performance is a sign of any major shift in the composition of market share in this sector. Also, for comparison purposes, revenues changed by -45.29% and earnings by 92.47% compared to the previous period.

Earnings Growth Analysis

The company’s earnings growth was influenced by year-on-year improvement in gross margins from -58.78% to 9.44% as well as better cost controls. As a result, operating margins (EBITDA margins) rose from -108.02% to -18.58% compared to the same period last year. For comparison, gross margins were 13.68% and EBITDA margins were -14.17% in the last reporting period.

Margins

The company’s earnings growth has also been influenced by the following factors: (1) Improvements in operating (EBIT) margins from -110.80% to -18.58% and (2) one-time items. The company’s pretax margins are now -29.53% compared to -106.87% for the same period last year.

EBIT Margin History
PreTax Margin History

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Company Profile

Visionchina Media, Inc. engages in the development and provision of advertising services. The company operates an out-of-home advertising network on mass transportation systems, including buses and subways. Its network consists of real-time broadcasting, news, stock quotes, weather and traffic updates, sports highlights, entertainment programs mixed with advertisements. The company was founded by Li Min Li and Yan Qing Liang on April 8, 2005 and is headquartered in Shenzhen, China.

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