Unaudited financial reports for the first quarter of the gathering period

"We are very pleased that even in the first quarter of relatively slow growth due to quarterly factors, the company's business was still very strong and continued to have a strong momentum of growth," said Lee Colling, chief executive of the gathering era. In the first quarter of this year, our online music and entertainment services were once again more than expected, with revenue growth of 228% per cent year-on-year and a 103% per cent increase in the number of paid subscribers. In addition, in February this year, we also launched an online education platform--100 Education platform. By leveraging our powerful audio and video communications technology to provide real-time interactive courses for teachers and students, we will continue to broaden the diversity and user base of our online communities. At the same time, the increasingly rich user-produced content on our platform has also enhanced the user's participation and stickiness in our platform, while also pulling the number of our single average monthly active users to 95.5 million in the first quarter of this year. With our strong foundation, we will continue to attract platform users and improve our product supply and monetization capabilities through the development of online entertainment, live broadcast, education and other vertical services, as well as our services to meet the changing dynamic needs of our customers. ”

He Zhenyu, chief financial officer of the gathering era, also said: "In the first quarter of 2014, our performance again exceeded the company's previously established target limit, mainly due to user participation and increased spending." In addition, in the first quarter of this year, due to the expansion of business scale, the net profit due to the gathering era almost doubled three times times. We will continue to expand our business and, to that end, our independent business model will further enhance our leverage and further enhance our ability to diversify our services. ”

Major results for the first quarter of 2014

In the first quarter of 2014, net revenue for the gathering period was 666.3 million yuan (about 107.2 million U.S. dollars), a 111.6% increase from 315 million yuan in the same period last year, mainly due to increased revenue from Internet value-added services.

In the first quarter of 2014, Internet value-added services (including revenue from online games, yy music and other sources, including affiliate programs), had a revenue of 642.1 million yuan (about 103.3 million U.S. dollars), a 127.1% increase from 282.8 million yuan a year earlier, This increase is mainly due to the number of paid users and the average revenue per user.

In the first quarter of 2014, the revenue of online music and entertainment services at the time of the gathering was 383.1 million yuan (about 61.6 million U.S. dollars), which grew by 228% from 116.8 million yuan a year earlier, mainly due to a 103.2% per cent increase in paid subscribers. To 1.006 million and per-user average revenue growth of 61.4% to 381 yuan and other factors.

In the first quarter of 2014, the net game revenue for the era was 180.3 million yuan (about 29 million US dollars), a 36.3% increase from 132.3 million yuan in the same period last year, which was mainly attributable to a year-on-year increase in average revenue per user of 24.1% To 391 yuan and the number of paid users increased by 9.8% to 461,000 and other factors. In the first quarter of 2014, the number of online games in the gathering era grew from 92 in the same period last year to 139.

In the first quarter of 2014, other Internet value-added service revenues (including subscription fees for affiliate programs and real-time game playback costs) were 78.7 million yuan (about 12.7 million U.S. dollars), up 133.7% from 33.7 million yuan a year earlier. In the first quarter of 2014, the revenue from membership subscriptions was 43.4 million yuan (about 7 million U.S. dollars), up 54.3% from 28.1 million yuan a year earlier. This growth was mainly attributable to the increase in the number of members from 546,000 to 851,000 over the same period last year, and the real-time game playback revenue of 23.6 million yuan (about 3.8 million U.S. dollars), up 3.2 million yuan in the same period last year.

In the first quarter of 2014, the network advertising revenue for the era of 24.2 million yuan (about 3.9 million U.S. dollars), compared with the same period last year, 32.2 million Yuan fell 24.7%.

In the first quarter of 2014, the revenue cost of the gathering period was 317 million yuan (about 51 million U.S. dollars), which grew by 117.6% over the same period of 145.7 million yuan last year. The increase was mainly attributable to the increase in revenue-sharing costs and content costs from 56.1 million yuan to 179 million yuan (about $28.8 million trillion) in the same period last year.

In the first quarter of 2014, the 349.3 million yuan (about 56.2 million U.S. dollars) was earned at the time of the year, with a 106.4% per cent increase over the same period of 169.3 million yuan in the month, with a gross profit margin of 52.4% and a year earlier of 53.7%.

During the first quarter of 2014, the operating expenses of the gathering period were 145.2 million yuan (about 23.4 million U.S. dollars), a 37.9% increase from 105.3 million yuan a year earlier, which was mainly due to growth in research and development spending, general services and management spending.

During the first quarter of 2014, the operating profit of the gathering period was 205 million yuan (about 33 million US dollars), which was 217.9% higher than the 64.5 million yuan in the same period last year. In the first quarter of 2014, the operating profit of non-US general accounting standards was 229 million yuan (about 36.8 million US dollars), which grew 177.2% from the same period last year, and the operating profit margin of non-US GAAP was 34.4%, compared with 26.2% in the same period last year.

In the first quarter of 2014, the net profit earned at the time of the gathering was 183.6 million yuan (about 29.5 million U.S. dollars), a 187.2% increase from 63.9 million yuan in the same period last year, and a net interest rate of 27.5%, compared with 20.3% in the same period last year.

In the first quarter of 2014, the net profit for non-US GAAP was 207.6 million yuan (about 33.4 million US dollars), up 153% from the same period last year, and the net interest rate for non-US GAAP was 31.2%, compared with 26.1% in the same period last year.

In the first quarter of 2014, the United States depository shares diluted profits of 3.06 yuan (about 0.49 U.S. dollars), compared to the same period last year, 1.11 yuan growth of 175.7% The diluted profit of the US depository shares of non-US GAAP was 3.46 yuan (about 0.56 U.S. dollars), up 143.7% from 1.42 yuan in the same period last year.

As of March 31, 2014, the cash and cash equivalents and short-term deposits held during the gathering period amounted to RMB 4.7 billion (about 761.8 million U.S. dollars), up to December 31, 2013 of 2.2 billion yuan. In the first quarter of 2014, the net cash from operating activities was 195.5 million yuan (about 31.4 million US dollars).

Repurchase stock

May 4, 2014, the gathering of the Times the Board approved a stock repurchase plan. According to this plan, the gathering time will not be more than 12 months in the future, the company is not regularly repurchase the ceiling of 100 million U.S. dollars in the circulation of the United States depository stocks. Repurchase funds will be withdrawn from existing cash balances.

Business Expectations

In the second quarter of 2014, it is expected that net revenue will reach 745 million yuan to 755 million yuan, with an increase of 82% to 85% per cent year-on-year.

Stock price

In the first quarter of 2014, the United States depository stocks, which were not United States GAAP, diluted profits of 3.46 yuan (about 0.56 U.S. dollars), exceeding the expected $0.48 trillion of capital IQ analysts, and a revenue of 107.2 million dollars and more than IQ analyst expected 95.3 million dollars. However, the market analysis agency TheStreet Fitch team, while seeing many positive developments in the welcome era, believes that the company's earnings per share is not up to expectations, and thus the company's share of the era is rated as "holding" level.

During the Monday Nasdaq stock Exchange, the rally-era share price rose 1.34 to $61.96, or 2.21%, but during the post-trading period, the gathering time fell 2.46 to 59.50 dollars, or 3.97%.