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China Digital Media Corporation (OTC:CDGT), one
of the fastest growing companies in the China broadcasting media
and Cable TV industry, today announced the completion of its acquisition
of Arcotect Digital Technology Limited ("Arcotect"), which
reported audited financial results of $3.9 million in revenue and
$1.9 million in net income for the full year ended December 31,
2004.
Arcotect Digital Technology Limited and its China
operating subsidiary Arcotect Technology (Guangzhou) Limited is
the sole contractor and operator of digital television services
in Nanhai, a city in the Guangdong province. During the first full
year of operations in fiscal year 2004, Arcotect recorded revenues
of $3.9 million and earned a modest net income of $1.9 million.
The city of Nanhai has approximately 400,000 paying Cable TV subscribers
which it plans to migrate from analog television to digital television.
Thus far, the company had migrated around 100,000 subscribers from
analog television to digital television by installing a digital
set-top-box into subscriber's premises. The company is offering
additional 60 TV channels divided into four product packages, namely
"World Movies", "Life & Leisure", "World
Sports" and "News". The company is responsible for
migrating all 400,000 subscribers from analog to digital television
service as well as operating its own pay-TV and interactive services.
The company currently employs approximately 200 people to support
the existing operations.
The Company plans to allocate more resources in
order to develop more high value added services, including but not
limited to information services (e- Government), High-Definition
Television service, IP Set-top-box and Near- Video-On-Demand service.
"The Company's first full year's operating
results are very encouraging," said Daniel Ng, Chairman and
CEO of China Digital Media Corporation." Nanhai is the first
model city in China to implement city-wide total migration of Digital
Television by contracting with professional managers who fund their
operations from the capital market. Our success represents a successful
model of cooperation and a win-win situation for the state owned
Cable Network Company, the TV viewers and investors like us. We
intend to duplicate this successful model and seek co-operation
with cable companies in other cities of China and continue to grow
our business with contributions from existing operations and new
businesses."
Mr. Ng also noted that, "The broadcasting media
and Cable TV industry is capital intensive and is gradually opening
up to foreign investment. The company plans to expand and diversify
into 1) TV Channel operations and Advertisement sales and 2) TV
program production and related content management services in the
near future through selective acquisitions and alliances."
To be added to China Digital Media's investor e-mail
list, please send e- mail to our Investors Relations at
ir@chinadigimedia.com
China Digital Media Corporation ((OTC:CDGT)) is
one of the fastest growing companies engaged in the business of
broadcasting media and Cable TV in the People's Republic of China.
The Company is realigning its business direction to cover more segments
of the media industry through investment, mergers, acquisitions
and alliance partnership. In view of the rapid growth and potential
market of China's media industry, the Company will continue to put
its resources into the target media market across the China while
looking for potential distribution partners in the United States
and other countries.
For more information on us, please go to our website
at http://www.chinadigimedia.com
.
Forward-looking statement: Except for the historical
information, the matters discussed in this news release may contain
forward-looking statements, including, but not limited to, factors
relating to future sales and operation revenues. These forward-looking
statements may involve a number of risks and uncertainties. Actual
results may differ materially based on a number of factors, including,
but not limited to, uncertainties in the demand of China media market,
risks related to doing business in China, the impact of competitive
products and pricing, changing economic conditions around the world,
release and sales of new products.
________________________________________
SOURCE: China Digital Media Corporation
CONTACT: Daniel Ng of China Digital Media Corporation, +852 2390
8686, or pr@arcotect.com
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