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HONG KONG, June 16 /Xinhua-PRNewswire-FirstCall/
-- China Digital Media Corporation (OTC Bulletin Board: CDGT) announced
today that Daniel Ng, its Chairman and CEO, was interviewed on CEOcast
Inc.'s financial portal, http://www.ceocast.com
. In the interview, Mr. Ng provided an overview of the Company's
business, discussed the television advertising market within China,
the Company's acquisition strategy and details on the first quarter
results that China Digital previously announced for the period ended
March 31, 2006.
In the interview, Mr. Ng discussed the Company's
first quarter results in greater detail, including the reason behind
China Digital posting strong revenue and pre-tax income growth,
yet a nominal increase in net income. ''The flat growth in net earnings
for the first quarter of 2006, compared to the first quarter of
2005, is mainly a result of provision for income taxes,'' noted
Mr. Ng in the interview. ''As a foreign company registered in the
Tianhe Technology Park in Guangdong Province, the Company was eligible
for a special tax treatment that allows a foreign company to pay
no income tax for the first two years and to pay tax at a 50% discount
for the following three years until the tax benefit was eliminated.
In the fourth quarter of 2005, the Company was informed by the corresponding
government departments that services based income from the digital
television operation was not eligible for special tax treatment
although the Company's subsidiary is registered in the Tianhe Technology
Park. As a result, the Company began accruing income tax at the
ordinary rate and was required to recognize income tax for prior
periods in 2005.''
''Our net earnings before tax for the first quarter
of 2005 was about $438,000, compared to net earnings before tax
for the first quarter of 2006 of over $720,000, representing an
increase of approximately 64% year to year. In fact, our pre-tax
profitability grew significantly compared to the first quarter of
2005.
Apart from the tax provision issue, depreciation
has grown more than double to over $570,000 compare to last year
due to increased number of STB's installed. We expect to maintain
this high level in coming years because this year will be representing
peak of migration work. We think the flat growth in this quarter
should not be interpreted as a signal of inability to growth.''
For more information on the Company, please visit
the Company's website at http://www.chinadigimedia.com
.
To be added to China Digital Media's investor e-mail
list, please send e- mail to our Investors Relations at ir@chinadigimedia.com
.
About China Digital Media Corporation
China Digital Media Corporation focuses its business
in three main areas: Cable TV Operations, Programs Production and
Advertising Sales. Arcotect (GZ) Limited, a wholly owned subsidiary
of CDGT in China, is the sole contractor and operator of digital
television services in Nanhai, a city with 400,000 cable TV subscribers.
As of today, Nanhai's cable television operation provides 148 television
channels which comprises of 48 basic channels and 100 pay channels.
The pay channels are categorized into various value added packages.
Certain information contained in these materials
is 'forward-looking' information, such as projections, estimates,
pro formas, or statements of intentions, expectations or plans.
Forward-looking information in this release includes, without limitation,
the future success of the Company's advertising business and of
the Company's joint ventures, the Company's ability to grow and
generate new sources of revenues from its IP STB in the future and
its ability to keep its IP STB technologically current. All forward-looking
information is subject to known and unknown risks and uncertainties,
many of which are outside of the control of the company. Consequently,
actual results may, and probably will, differ materially from the
results contemplated in such forward-looking information.
For more information, please contact:
Investor Relations
Tel: +852-2390-8600
or
Ed Lewis of CEOcast, Inc.
Tel: +1-212-732-4300
SOURCE China Digital Media
Corporation
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