Youku Tudou Inc. (YOKU) a Chinese Internet television company, on Thursday reported a loss for the fourth quarter that narrowed from last year on higher revenues and lower operating expenses.
However, the company forecast revenues for the first quarter to decline sequentially, citing a temporary business impact from the merger between Youku and Tudou Holdings. The company's shares tumbled more than 11 percent in extended trade.
On August 23, 2012, the company and Tudou Holdings Ltd. announced the completion of their merger. Following the merger completion, Tudou's financial results were consolidated into the company from the date of the completion of the merger.
Victor Koo, Chairman and Chief Executive Officer of Youku Tudou said, "I am pleased with our financial and operational performance in the fourth quarter, which was the first full quarter for the merged Youku-Tudou company. We managed solid revenue growth and the net loss for the combined company has narrowed materially despite sales disruption brought on by the reorganization of our sales team after the merger."
Youku Tudou's net loss for the fourth quarter was RMB 113.57 million or $18.2 million, narrower than pro forma combined net loss of RMB 198.47 million or $31.9 million in the year-ago period. Loss per ADS narrowed to RMB 0.69 or $0.11 from RMB 1.23 per ADS in the prior-year period.
Adjusted net loss for the quarter was RMB 62.25 million or $10 million, compared to pro forma combined adjusted net loss of RMB 174.64 million or $28 million in the prior-year quarter.
Net revenue for the fourth quarter grew 30 percent to RMB 635.83 million or $102.06 million from pro forma combined net revenues of RMB 489.35 million a year ago.
Consolidated advertising net revenues were RMB 574.9 million, primarily attributable to the increased use by brand advertisers of the company's advertising services as evidenced by an increase in the number of advertisers and the rising average spend per advertiser.
Total operating expenses for the quarter declined to RMB 244.97 million from RMB 273.39 million in the same period last year.
For fiscal 2012, Youku Tudou's consolidated net loss was RMB 424.00 million or $68.06 million, while loss per ADS was RMB 3.20 or $0.51. Adjusted net loss for the year was RMB 244.67 million or $39.27 million. Net revenues for the year were RMB 1.80 billion or $288.21 million.
Looking ahead to the first quarter, Youku Tudou forecast net revenues in a range of RMB 480 million to RMB 520 million, with consolidated advertising net revenues contributing between RMB 420 million and RMB 450 million.
CEO Victor Koo said, "Even as the integration process is proceeding well, we expect temporary business impact from this large-scale merger but we are optimistic that the second half of 2013 will see more revenue growth momentum and cost synergies. In 2013, we also plan to start monetizing the significant growth in our mobile traffic as our daily mobile video views exceeded 100 million by the end of 2012."
YOKU closed Thursday's trading at $20.39, up $0.20 or 0.99 percent on a volume of 4.72 million shares. However, in after-hours, the stock declined $2.34 or 11.48 percent to $18.05.
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