The report shows that the fourth quarter total revenue of the air network is 43.84 million U.S. dollars

The Air Network (Nasdaq:kong) today released its unaudited financial results for the 2013 fiscal year ended December 31. According to the report, the fourth quarter total revenue of the air network was 43.84 million U.S. dollars, up 2.8% from 42.63 million U.S. dollars in the same period last year, exceeding the company's previous expected 41 million dollars to 42 million U.S. dollars, net profit of 10.03 million U.S. dollars, compared with the same period last year 4.77 million U.S. dollar growth 110%, Exceed the company's previous expectations of 8 million dollars to 9 million U.S. dollars.

Major results for the fourth quarter of 2013:

The fourth quarter's total revenue was 43.84 million U.S. dollars, down 0.6% from the previous quarter, but it grew 2.8% from 42.63 million dollars a year earlier, exceeding the company's previous forecast of 41 million dollars to 42 million dollars;

The net's gross profit for the fourth quarter was $21.72 million trillion, up 13.7% from the previous quarter, up 20.6% from a year earlier, exceeding the company's previous forecast of $20 million to 21 million dollars;

The fourth-quarter net profit for the air network, according to the US GAAP, was $10.03 million trillion, up 110% from $4.77 million a year earlier, exceeding the company's previous forecast of $8 million to 9 million dollars. According to the United States General accounting standards, the net loss in the first quarter of the air network was $2.68 million, which included a loss of $1.56 million trillion in intangible assets and losses of $2 million trillion in long-term investments. According to the United States General accounting standards, the fourth quarter of the air network in the United States depository receipts of the basic income of 0.22 U.S. dollars;

In accordance with U.S. general accounting standards, the fourth quarter net profit of the air network is 10.65 million U.S. dollars, higher than the company's expected 9 million U.S. dollars to 10 million U.S. dollars. Not in accordance with the United States General accounting standards, the fourth quarter of the air network in the United States depository receipts for a thin income of 0.23 U.S. dollars;

As at December 31, 2013, the Air network held cash and cash equivalents, term deposits, securities held to maturity and restricted cash values of USD 216.61 million, namely, cash and cash equivalents for United States depository receipts per share, term deposits, securities held to maturity and restricted cash of USD 4.78.

Major achievements 2013:

Air Network 2013 total revenue of 179.44 million U.S. dollars, of which wireless value-added services revenue of 63.92 million U.S. dollars, less than the 2012 77.77 million U.S. dollars, mobile game revenue of 17.07 million U.S. dollars, less than 2012 21.19 million U.S. dollars, net game revenue of 98.45 million U.S. dollars, higher than the 2012 87.42 million dollars;

In 2013, the total gross profit margin of the air network was 43.1%, compared with 2012 41.6%. Among them, wireless value-added service gross profit margin of 31.1%, mobile gaming business gross profit margin of 53.5%, network game business gross profit margin of 49%;

In accordance with the United States General accounting standards, the net profit of 2013 years is 20.66 million U.S. dollars, lower than the 2012 of 25.74 million U.S. dollars, but it included a 1.56 million dollar loss of intangible assets and 2 million dollars in long-term investment impairment losses;

Not in accordance with U.S. general accounting standards, the network 2013 years of net profit of 28.87 million U.S. dollars, less than 2012 of 35.92 million U.S. dollars.

Financial Analysis:

In the quarter, wireless value-added services in the air network received $13.83 million trillion, down 23.2% from the previous quarter, down 5.4% from a year earlier. In general, air network wireless value-added services in the end of each year due to the company's mobile operator policy and business practices and the seasonal weakness of the performance, but the company expects 2014 wireless value-added services operating environment compared with the 2013 level will be stable. The fourth quarter of the air network total wireless value-added services revenue in the total revenue accounted for 31.6%.

The net mobile gaming revenue for the quarter was $4.92 million, up 18.1% from a year earlier, and 4.7% per cent from the previous quarter. The fourth-quarter mobile gaming revenue for the internet was 1.81 million dollars, down from 3.21 million dollars in the previous quarter. Mobile operator Partners in the Air network continue to implement stringent operational policies, while continuing to reduce the importance of mobile gaming marketing for functional mobile phones.

The fourth-quarter smartphone mobile gaming revenues were $3.11 million, up 108.4% from the previous quarter, and accounted for 63.2% of total mobile gaming revenue. In the fourth quarter, the number of monthly average active users of mobile Internet smartphone games was 1.32 million, the total number of total paid accounts was 86,000, and the quarterly average revenue was 222 yuan per user. Fourth-quarter mobile gaming revenues accounted for 11.2% of total revenue.

Fourth-quarter internet gaming revenues were 25.08 million dollars, up 17.4% from the previous quarter, up 5.2% from a year earlier. Fourth-quarter internet gaming revenues accounted for 57.2% of total revenue.

In the fourth quarter, the Internet gaming revenues were 24.22 million dollars, up 16.6% from the previous quarter, up 6% from a year earlier. In the fourth quarter, internet gaming revenues were 860,000 U.S. dollars, up 44.6% from the previous quarter, down 13.1% from a year earlier. In the fourth quarter, the net revenue growth of overseas internet games was mainly due to the "Kung Fu Hero", which received a contribution from Korean business partners ' authorized income.

The average online internet gaming business in the fourth quarter was 467,000, up 11% from a year earlier, up 14.2% from the previous quarter, with a total of 774,000 paid accounts and a quarterly average of 192 yuan per user.

The net's gross profit for the fourth quarter was $21.72 million, up 13.7% from the previous quarter, up 20.6% from a year earlier. The fourth quarter total gross profit margin of the air network is 49.5%.

Air network total wireless value-added services the gross profit for the quarter was $4.62 million trillion, down 28.5% from the previous quarter. Air Network wireless value-added services the gross profit margin for the quarter was 33.4%, below 35.9% in the previous quarter.

Mobile games in the last quarter gross profit was $3.45 million, up 49.2% from the previous quarter, up 43.5% from a year earlier. Online mobile gaming services in the quarter's gross profit margin was 70%, up from 57.6% last year and 49.1% in the previous quarter. Online mobile gaming The rise in gross profits in the quarter was mainly due to higher profit-earning smartphone game revenues relative to functional mobile gaming revenues. The company expects to launch a variety of new smartphone games in the first quarter and the second quarter of 2014.

The fourth-quarter Internet game's gross profit was $13.65 million trillion, up 32.2% from the previous quarter, up 19.3% from a year earlier. In the fourth quarter, the Internet game's gross profit margin was 54.4%, the same period last year was 48%, the previous quarter was 48.3%.

The fourth-quarter total operating expenses for the air network were $15.7 million trillion, up from $21.5 million in the previous quarter.

The fourth-quarter development cost for the air network was 6.82 million U.S. dollars, with 6.99 million dollars in the previous quarter.

The fourth-quarter sales and marketing costs for the air network were 6.52 million dollars, up from 10.94 million in the previous quarter. Sales and marketing activities increased in the third quarter, based on an increase in promotional activities for smartphone games and tank world. The decline in sales and marketing costs in the fourth quarter of the air network was mainly due to a decrease in such activities.

The fourth quarter of the Air network general and management costs for 2.36 million U.S. dollars, the last quarter of 2.03 million U.S. dollars.

As of the end of the fourth quarter, the total number of air network staff held steady at 1153, compared to the end of the last quarter of 1166 people.

Air network in the fourth quarter and not in accordance with the United States General accounting standards of the net profit of 10.03 million U.S. dollars and 10.65 million U.S. dollars, according to and not in accordance with the United States General accounting standards per share of the United States depository receipts of the income is 0.21 U.S. dollars and 0.23 U.S. dollars respectively.

The fourth quarter of the air network in the external circulation of diluted shares of 46.85 million shares, compared to the previous quarter of 43.5 million shares.

As at December 31, 2013, the Air network held cash and cash equivalents, term deposits, securities held to maturity and restricted cash values of USD 216.61 million, namely, cash and cash equivalents for United States depository receipts per share, term deposits, securities held to maturity and restricted cash of USD 4.78.

Business outlook:

The air network predicts that the overall revenue for the first quarter of 2014 will be between 45.5 million and 46.5 million dollars. Estimates of expected revenue mean that wireless value-added services revenue of 13.5 million U.S. dollars, mobile gaming revenue of 8.5 million U.S. dollars, internet network games revenue of 24 million U.S. dollars.

The air network expects gross profits to be between $22.5 million trillion and $23.5 million trillion in the first quarter of 2014, with net profit between 9.5 million and 10.5 million dollars, and no net profit from US GAAP to be between 10.5 million and 11.5 million dollars.

Conference：

After the release of the earnings, the air network will be in the U.S. Eastern Time February 24 19:30 (Beijing time February 25 early 8:30) conference call. The air network management will attend the meeting to interpret the earnings points and answer questions from investors and analysts. Investors can also visit the Air Network website ir.kongzhong.com and listen to the teleconference webcast and recording.