Funtalk China Increases Q1 Profits By 133% Through Acquisitions
Funtalk China Holdings (“Funtalk”)(Nasdaq: FTLK), a China-based retailer
and wholesale distributor of mobile phones and other wireless devices,
announced for the first quarter of 2010 the company recorded profits of
$9.6 million, or $0.19 per diluted share, on revenues of $253 million.
The results represented a year-on-year increase in profits and revenues
of 133% and 28%, respectively, driven primarily by growth from the
company’s retail segment.
The market reacted mildly to the
results as Funtalk’s share price edged slightly upwards by 0.75% to
trade at $8.00 on the Nasdaq.
Retail revenue increased 77.5%
on a year-on-year basis to $122.7 million due to the acquisitions of new
retail subsidiaries. At the end of the first quarter, Funtalk had a
total of nine retail subsidiaries covering 528 locations compared to six
retail subsidiaries covering 198 locations a year ago. The newly
acquired subsidiaries contributed $44.7 million to revenues for the
retail segment.
The wholesale segment posted revenues of $130.3
million, a 1.3% increase from the first quarter of 2009. The increase
in wholesale revenues was attributable to larger sales volume that was
offset by lower average prices.
As of June 30, 2010, FunTalk had net assets of approximately $130 million, or $2.5 per outstanding share.
The
company also announced that it is now the only wholesale distributor
and retailer chosen as a national partner by all three of the mobile
carriers in China and the company stands to benefit if Chinese carriers
increase subsidies to channels and end-users as expected.
For
fiscal 2011, Funtalk expects to earn net income in the range of $40
million to $45 million on revenues between $1.0 billion and $1.2
billion.
Funtalk is a retailer and distributor of wireless
communications devices, accessories and content in 30 provinces in
China. Funtalk currently has a network 612 mobile phone retail stores in
approximately 108 cities.
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