| At | At | |||||||
| June 30 | December 31 | |||||||
| 2005 | 2004 | |||||||
| (Unaudited) | ||||||||
ASSETS | ||||||||
Current Assets: | ||||||||
| Cash and cash equivalents | $ | 49,664 | $ | 41,195 | ||||
| Available-for-sale securities | 51,766 | 10,172 | ||||||
| Accounts receivable, net | 4,790 | 5,147 | ||||||
| Receivables from sales representatives | 6,837 | 3,407 | ||||||
| Inventory of paper | 757 | 750 | ||||||
| Prepaid expenses and other current assets | 5,784 | 2,926 | ||||||
Total Current Assets | 119,598 | 63,597 | ||||||
| Property and equipment, net | 24,601 | 24,902 | ||||||
| Long term investments | 100 | 100 | ||||||
| Bonds held to maturity, at amortized cost | 685 | 666 | ||||||
| Other assets | 2,755 | 3,260 | ||||||
Total Assets | $ | 147,739 | $ | 92,525 | ||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
Current Liabilities: | ||||||||
| Accounts payable | $ | 5,698 | $ | 4,798 | ||||
| Deferred income and customer prepayments | 35,653 | 28,775 | ||||||
| Accrued liabilities | 5,818 | 5,921 | ||||||
| Income taxes payable | 463 | 384 | ||||||
Total Current Liabilities | 47,632 | 39,878 | ||||||
| Liabilities for incentive and bonus plans | 467 | 467 | ||||||
| Deferred income and customer prepayments — long term | 2,184 | 1,420 | ||||||
| Minority interest | 5,747 | 4,910 | ||||||
| Deferred tax liability | 317 | 327 | ||||||
Total Liabilities | 56,347 | 47,002 | ||||||
Shareholders’ equity: | ||||||||
| Common shares, US$0.01 par value; 50,000,000 shares authorized; 34,853,435 (2004: 31,847,935) shares issued and outstanding | 349 | 319 | ||||||
| Additional paid in capital | 127,247 | 86,373 | ||||||
| Retained deficit | (28,054 | ) | (34,577 | ) | ||||
| Less : Unearned compensation | (8,502 | ) | (6,831 | ) | ||||
| Accumulated other comprehensive income | 352 | 239 | ||||||
Total Shareholders’ Equity | 91,392 | 45,523 | ||||||
Total Liabilities and Shareholders’ Equity | $ | 147,739 | $ | 92,525 | ||||
| Three months ended | Six months ended | |||||||||||||||
| June 30 | June 30 | |||||||||||||||
| 2005 | 2004 | 2005 | 2004 | |||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||
Revenue: | ||||||||||||||||
| Online and other media services (Note 1) | $ | 24,033 | $ | 23,004 | $ | 46,669 | $ | 45,028 | ||||||||
| Exhibitions | 7,558 | 5,846 | 7,558 | 7,355 | ||||||||||||
| Miscellaneous | 144 | 126 | 275 | 255 | ||||||||||||
| 31,735 | 28,976 | 54,502 | 52,638 | |||||||||||||
Operating Expenses: | ||||||||||||||||
| Sales | 8,589 | 7,531 | 16,305 | 15,035 | ||||||||||||
| Event production | 1,792 | 1,721 | 1,792 | 1,901 | ||||||||||||
| Community | 5,900 | 4,900 | 9,641 | 8,292 | ||||||||||||
| General and administrative | 8,939 | 8,317 | 16,470 | 15,498 | ||||||||||||
| Online services development | 988 | 1,036 | 1,972 | 2,108 | ||||||||||||
| Non-cash compensation expense (Note 2) | 282 | 137 | 811 | 970 | ||||||||||||
| Amortization of software cost | 414 | 369 | 710 | 738 | ||||||||||||
Total Operating Expenses | 26,904 | 24,011 | 47,701 | 44,542 | ||||||||||||
Income from Operations | 4,831 | 4,965 | 6,801 | 8,096 | ||||||||||||
| Interest income | 338 | 19 | 389 | 55 | ||||||||||||
| Gain on sale of available-for-sale securities | 269 | 633 | 308 | 633 | ||||||||||||
| Foreign exchange gains (losses), net | 35 | (55 | ) | 179 | (3 | ) | ||||||||||
Income before Income Taxes | 5,473 | 5,562 | 7,677 | 8,781 | ||||||||||||
Income Tax Provision | (195 | ) | (258 | ) | (317 | ) | (452 | ) | ||||||||
Net Income before Minority Interest | $ | 5,278 | $ | 5,304 | $ | 7,360 | $ | 8,329 | ||||||||
| Minority interest | $ | (755 | ) | $ | (207 | ) | $ | (837 | ) | $ | (604 | ) | ||||
Net Income | $ | 4,523 | $ | 5,097 | $ | 6,523 | $ | 7,725 | ||||||||
Retained deficit brought forward | $ | (34,577 | ) | $ | (50,346 | ) | ||||||||||
Retained deficit carried forward | $ | (28,054 | ) | $ | (42,621 | ) | ||||||||||
Basic net income per share | $ | 0.13 | $ | 0.16 | $ | 0.19 | $ | 0.24 | ||||||||
Shares used in basic net income per share calculations | 34,853,435 | 31,847,935 | 33,492,557 | 31,845,974 | ||||||||||||
Diluted net income per share | $ | 0.13 | $ | 0.16 | $ | 0.19 | $ | 0.24 | ||||||||
Shares used in diluted net income per share calculations | 34,946,986 | 31,964,727 | 33,609,752 | 31,957,448 | ||||||||||||
| Note: 1. Online and other media services consists of: |
| Three months ended June 30 | Six months ended June 30 | |||||||||||||||
| 2005 | 2004 | 2005 | 2004 | |||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||
| Online services | $ | 13,336 | $ | 13,016 | $ | 26,429 | $ | 25,922 | ||||||||
| Print services | 10,697 | 9,988 | 20,240 | 19,106 | ||||||||||||
| $ | 24,033 | $ | 23,004 | $ | 46,669 | $ | 45,028 | |||||||||
| Note: 2. | Reflects the non-cash compensation expenses associated with the employee equity compensation plans. Non-cash compensation represents the following categories of expenses: |
| Three months ended June 30 | Six months ended June 30 | |||||||||||||||
| 2005 | 2004 | 2005 | 2004 | |||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||
| Sales | $ | 34 | $ | (12 | ) | $ | 182 | $ | 249 | |||||||
| Community | 25 | 17 | 54 | 48 | ||||||||||||
| General and administrative | 114 | 69 | 369 | 532 | ||||||||||||
| Online services development | 109 | 63 | 206 | 141 | ||||||||||||
| $ | 282 | $ | 137 | $ | 811 | $ | 970 | |||||||||
| Six months ended June 30 | ||||||||
| 2005 | 2004 | |||||||
| (Unaudited) | (Unaudited) | |||||||
Cash flows from operating activities: | ||||||||
| Net income | $ | 6,523 | $ | 7,725 | ||||
| Adjustments to reconcile net income to net cash provided by operating activities | ||||||||
| Depreciation and amortization | 1,927 | 1,997 | ||||||
| Accretion of U.S. Treasury strips zero % coupons | (19 | ) | (30 | ) | ||||
| Profit on sale of equipment | (8 | ) | — | |||||
| Property and equipment written off | 26 | 7 | ||||||
| Gain on sale of available-for-sale securities | (308 | ) | (633 | ) | ||||
| Interest income on available-for-sale securities | (270 | ) | — | |||||
| Bad debt expense | — | 37 | ||||||
| Non-cash compensation expense | 811 | 970 | ||||||
| Income attributable to minority shareholder | 837 | 604 | ||||||
| 9,519 | 10,677 | |||||||
Changes in assets and liabilities: | ||||||||
| Accounts receivables | 357 | 524 | ||||||
| Receivables from sales representatives | (3,430 | ) | (194 | ) | ||||
| Inventory of paper | (7 | ) | 19 | |||||
| Prepaid expenses and other current assets | (2,857 | ) | (753 | ) | ||||
| Long term assets | 505 | (1,687 | ) | |||||
| Accounts payable | 900 | 1,033 | ||||||
| Accrued liabilities and liabilities for incentive and bonus plans | (103 | ) | (493 | ) | ||||
| Deferred income and customer prepayments | 7,642 | (2,492 | ) | |||||
| Tax liability | 69 | (26 | ) | |||||
Net cash provided by operating activities | 12,595 | 6,608 | ||||||
Cash flows from investing activities: | ||||||||
| Purchase of property and equipment | (1,652 | ) | (1,030 | ) | ||||
| Proceeds from sales of equipment | 8 | 1 | ||||||
| Proceeds from matured bonds | — | 123 | ||||||
| Net purchase of available-for-sale securities | (40,903 | ) | (22,412 | ) | ||||
Net cash used for investing activities | (42,547 | ) | (23,318 | ) | ||||
Cash flows from financing activities: | ||||||||
| Proceeds from the issue of common shares, net of share issue expenses | 38,303 | — | ||||||
| Amount received towards directors purchase plan | 118 | 92 | ||||||
Net cash generated from financing activities | 38,421 | 92 | ||||||
| Net increase (decrease) in cash and cash equivalents | 8,469 | (16,618 | ) | |||||
| Cash and cash equivalents, beginning of the period | 41,195 | 26,227 | ||||||
Cash and cash equivalents, end of the period | 49,664 | 9,609 | ||||||
Supplemental cash flow disclosures: | ||||||||
| Income tax paid | $ | 248 | $ | 478 | ||||
