Glory Star Reports Full Year 2022 Financial Results

Rhea-AI Summary

Glory Star New Media Group Holdings Limited (GSMG) reported its financial results for the year ended December 31, 2022, showcasing resilience despite significant challenges. Total revenues reached $157.1 million, a slight increase from $153 million in 2021, with advertising revenue contributing $152 million, marking a 14.4% increase. Net income stood at $26.4 million, down from $35.4 million in the previous year. The CHEERS App downloads surged to 377 million, and monthly active users rose to 51.5 million. Operating expenses increased due to higher costs in production and marketing, reflecting ongoing investments in content and brand recognition.

Positive

• Total revenues increased to $157.1 million from $153 million in 2021.
• Advertising revenue rose to $152 million, a 14.4% growth year-over-year.
• CHEERS App downloads increased to 377 million from 271 million.
• Monthly active users of the CHEERS App grew to 51.5 million from 47.6 million.
• Net income of $26.4 million despite macroeconomic challenges.

Negative

• Net income decreased from $35.4 million in 2021 to $26.4 million in 2022.
• Operating expenses increased significantly, with general and administrative expenses up by 76.8%.

BEIJING, March 22, 2023 /PRNewswire/ -- Glory Star New Media Group Holdings Limited, ("Glory Star" or the "Company") (Nasdaq: GSMG), a leading digital media platform and content-driven e-commerce company in China, today announced its financial results for the full year ended December 31, 2022.

Full Year 2022 Operating Highlights

• Downloads of the CHEERS App^[1] was approximately 377 million as of December 31, 2022, compared to approximately 271 million as of December 31, 2021.
• Monthly active users ("MAUs") ^[2] of the CHEERS App increased to approximately 51.5 million from 47.6 million for the full year of 2022.
• Repurchase Rate ("RPR") for CHEERS e-Mall was approximately 34.5%.
• Daily Time Spent ("DTS") on CHEERS Video was approximately 56 minutes.

Full Year 2022 Financial Highlights

• Total revenues reached $157.1 million for the full year of 2022.
• Net Income reached $26.4 million for the full year of 2022.

[1] Glory Star defines this metric as the total number of downloads of the CHEERS App (video+e-Mall) as of the end of the period.

[2] Glory Star defines monthly active users, or MAUs, as a user who has logged in or accessed the Company's online video content and/or the Company's e-commerce platform using the CHEERS App, whether on a mobile phone or tablet. The Company calculates MAUs using internal company data based on the activity of the user account and as adjusted to remove "duplicate" accounts.

Mr. Bing Zhang, Chairman and Chief Executive Officer of Glory Star, commented, "2022 was a challenging year in light of significant COVID and macro headwinds, while our content production capacity and e-commerce logistics business were dampened throughout the year, we still manage to show great resilience in our business along with large increase in downloads of our CHEERS App from approximately 271 million to 377 million, in monthly active users of the CHEERS App to approximately 51.5 million from 47.6 million for the full year of 2022."

"As an internet Company, we generate most revenue from online business and were able to quickly adapt and maintain our revenue at $157 million for the full year of 2022, compared to $153 million for 2021, mainly benefited from advertising business. The Company also posted net income of $26.4 million amid great uncertainties posed by the macro-environment for the past year. Looking ahead, we remain confident in the long-term growth of our business with an emphasis on opportunities to deploy solutions across multiple business strings at scale. We will further expand our mobile and online business by creating a CHEERS ecosystem to add further value as our business looks to rebound in the new year."

Full Year 2022 Selected Financial Results

Revenues

Our revenues in the year of 2022 were $157 million compared to $153 million in the same period of 2021, which approximately maintained at the same level. Despite the uncertain external environment, the Company was able to enhance brand recognition and user traffic generation, leading to more exposure and high popularity of our apps, consequently, gaining a competitive edge during the fiscal year of 2022.

Our biggest source of revenue is Advertising revenue, $152 million for the year ended December 31, 2022, which is a 14.4% increase as compared with that of the year ended December 31, 2021.

Operating expenses

Operating expenses consists of cost of revenues, selling and marketing, general and administrative and research and development expense.

-  Cost of revenues increased to $40.6 million, for the year ended December 31, 2022 from $34.9 million for year ended December 31, 2021, mainly attributed by the production cost, as a result of our continued investment in quality content. That helps to gain and secure our competitive edge in the industry.

-  Sales and marketing expenses increased by $5 million, to $82.5 million for the year ended December 31, 2022 from $77.5 million for the year ended December 31, 2021, mainly due to an increase in marketing and advertising fees to enhance the Company's brand recognition and user traffic generation.

-  General and administrative expenses increased by $2.6 million, or 76.8%, to $6.0 million for the year ended December 31, 2022 from $3.3 million for the year ended December 31, 2021 mainly attributed by recording more allowance for credit loss for the year ended December 31, 2022.

-  Research and development expenses for the years ended December 31, 2021 and 2022 were $0.9 million and $1.3 million, respectively. Such increase was primarily due to the continued investment in the IT infrastructure, user-friendliness upgrades, and continual implementation on content driven strategies.

Net income

As a result of the foregoing, we had a net income of $26.4 million (including the revaluation gain of warrant liability related to private warrants) in 2022, as compared to a net income of $35.4 million (including the revaluation gain of warrant liability related to private warrants) in 2021.

Cash and cash equivalents

As of December 31, 2022, the Company had cash and cash equivalents of $70.5 million, compared to US$77.3 million as of December 31, 2021.

About Glory Star

Since its establishment in 2016, Glory Star has been focused on developing an ecosystem for its users that incorporates quality content, e-commerce, social networking, and gaming. The Company continues to integrate its cutting edge blockchain technologies, massive user base from its CHEERS ecosystem, quality content offerings, and its well-established e-commerce platform, and through the right application of 5G, AR, VR and NFT technologies to develop a metaverse boasting a wide range of "online + offline" and "virtual + reality" scenarios. Glory Star's CHEERS Video and e-Mall platforms provide a solid foundation for it to rapidly develop different entertainment and shopping applications for the metaverse. Glory Star also provides a suite of tools for its users to facilitate the development of new content by creators. The Company is remaining at the forefront of disrupting the way new media and e-commerce is operated. For more information, please visit http://ir.gsmg.co/.

Safe Harbor Statement

This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Forward-looking statements involve inherent risks and uncertainties and assumptions. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement. All information provided in this press release is as of the date of this press release, and Glory Star does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

For more information, please contact:

Wealth Financial Services LLC

Connie Kang
Partner
Email: ckang@wealthfsllc.com
Tel: +86 1381 185 7742 (CN)

 

 

 

GLORY STAR NEW MEDIA GROUP HOLDINGS LIMITED
CONSOLIDATED BALANCE SHEETS
(In U.S. dollars in thousands, except share and per share data)
		December 31, 2021				December 31, 2022
Assets
Current assets:
Cash and cash equivalents		$	77,302			$	70,482
Short-term investments			-				-
Accounts receivable, net			63,135				98,034
Prepayment and other current assets			13,103				15,329
Total current assets			153,540				183,845
Property, plant and equipment, net			242				160
Intangible assets, net			16,718				20,297
Deferred tax assets			56				103
Unamortized produced content, net			1,874				807
Right-of-use assets			1,298				750
Prepayment and other non-current assets, net			21,445				1
Total non-current assets			41,633				22,118
TOTAL ASSETS		$	195,173			$	205,963
Liabilities and Equity
Current liabilities:
Short-term bank loans		$	4,998			$	4,421
Accounts payable			12,878				6,405
Advances from customers			536				147
Accrued liabilities and other payables			2,251				2,632
Other taxes payable			13,104				19,090
Lease liabilities current			291				208
Due to related parties			500				-
Convertible promissory note - related party			-				-
Total current liabilities			34,558				32,903
Long-term bank loan			-
Lease liabilities non-current			1,127				471
Warrant liability			24				86
Total non-current liabilities			1,151				557
TOTAL LIABILITIES		$	35,709			$	33,460
Equity
Preferred shares (par value of $0.0001 per share; 2,000,000       authorized; none issued and outstanding)		$	-			$	-
Ordinary shares (par value of $0.0001 per share; 200,000,000       shares authorized as of December 31, 2021 and December       31,2022; 68,122,402 and 68,124,402 shares issued and       outstanding as of December 31, 2021 and 2022, respectively)		$	7			$	7
Additional paid-in capital			25,629				27,009
Statutory reserve			1,224				1,411
Retained earnings			123,982				150,685
Accumulated other comprehensive income(loss)			8,069				(6,684)
TOTAL GLORY STAR NEW MEDIA GROUP HOLDINGS LIMITED SHAREHOLDERS' EQUITY			158,911				172,428
Non-controlling interest			553				75
TOTAL EQUITY			159,464				172,503
TOTAL LIABILITIES AND EQUITY		$	195,173			$	205,963

 

 

 

GLORY STAR NEW MEDIA GROUP HOLDINGS LIMITED
CONSOLIDATED STATEMENTS OF OPERATIONS AND
COMPREHENSIVE INCOME (LOSS)
(In U.S. dollars in thousands, except share and per share data)
		For the Years Ended December 31,
		2020				2021				2022
		(Restated)
Revenues		$	123,763			$	153,012			$	157,079
Operating expenses:
Cost of revenues			(38,481)				(34,944)				(40,580)
Selling and marketing			(43,827)				(77,520)				(82,534)
General and administrative			(10,095)				(3,341)				(5,908)
Research and development			(691)				(920)				(1,331)
Total operating expenses			(93,094)				(116,725)				(130,353)
Income from operations			30,669				36,287				26,726
Other (expenses) income:
Interest expense, net			(282)				(513)				(93)
Change in fair value of warrant liability			19,714				809				(62)
Other income(expense), net			531				(255)				282
Total other (expenses) income			19,963				41				127
Income before income tax			50,632				36,328				26,853
Income tax expense			(1,673)				(976)				(413)
Net income			48,959				35,352				26,440
Less: net gain (loss) attributable to non-controlling interest			(31)				65				(450)
Net income attributable to Glory Star New Media Group Holdings Limited's shareholders		$	48,990			$	35,287			$	26,890
Other comprehensive (loss) income
Unrealized foreign currency translation (loss) gain			6,495				2,945				(13,357)
Comprehensive income			55,454				38,297				13,083
Less: comprehensive gain (loss) attributable to non-controlling interests			(4)				119				(478)
Comprehensive income attributable to Glory Star New Media Group Holdings Limited's shareholders		$	55,458			$	38,178			$	13,561
Earnings per ordinary share
Basic		$	0.91			$	0.54			$	0.39
Weighted average shares used in calculating earnings per ordinary share
Basic			53,844,237				65,381,186				68,123,870
Earnings per ordinary share
Dilutive		$	0.83			$	0.54			$	0.39
Weighted average shares used in calculating earnings per ordinary share
Dilutive			59,126,237				65,381,186				68,123,870

 

 

 

GLORY STAR NEW MEDIA GROUP HOLDINGS LIMITED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In U.S. dollars in thousands)
		For the Years Ended December 31,
		2020				2021				2022
		(Restated)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income		$	48,959			$	35,352			$	26,440
Adjustments to reconcile net income to net cash  provided by operating activities:
Allowance (Reversal of allowance) for doubtful accounts			(1,136)				(268)				440
Depreciation and amortization			2,910				2,090				2,884
Amortization of right-of-use assets			447				426				454
Deferred income tax (benefit) expense			(181)				713				(53)
Share based compensation for employees			5,381				4				-
Share based compensation for non-employees			1,779				181				391
Gains on disposal of a subsidiary			-				(26)				-
Amortization of loan origination fees			93				104				76
Change in fair value of warrant liability			(19,714)				(809)				63
Changes in assets and liabilities
Accounts receivable			(24,043)				19,904				(42,105)
Prepayment and other assets			(19,340)				(10,681)				16,872
Unamortized produced content			442				(537)				940
Accounts payable			2,827				4,750				(5,576)
Advances from customers			(39)				(87)				(356)
Accrued liabilities and other payables			5,177				(9,236)				564
Other taxes payable			5,555				4,964				7,346
Lease liabilities			(376)				(389)				(641)
Net cash provided by operating activities			8,741				46,455				7,739
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property, plant and equipment			(59)				(72)				(25)
Prepayments for acquisition of intangible assets			(2,722)				(2,718)				(7,964)
Cash disposed for sales of subsidiaries			-				(12)				-
(Payments) Return for short term investment			(1,637)				1,751				-
Net cash used in investing activities			(4,418)				(1,051)				(7,989)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from bank loans			6,228				5,114				6,096
Repayments of bank loans			(724)				(6,818)				(6,244)
Payment of loan origination fees			(146)				(68)				(87)
Contribution from shareholders			-				-				743
Repayments to related Parties			-				(232)				-
Cash acquired from the acquisition of TKK			23				-				-
Proceeds from equity finance			-				15,290				-
Net cash provided by financing activities			5,381				13,286				508
Effect of exchange rate changes			1,108				881				(7,078)
Net increase (decrease) in cash and cash equivalents			10,812				59,571				(6,820)
Cash and cash equivalents, at beginning of year			6,919				17,731				77,302
Cash and cash equivalents, at end of year		$	17,731			$	77,302				70,482
SUPPLEMENTAL DISCLOSURE OF CASH FLOW  INFORMATION:
Interests paid		$	239			$	336				247

 

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SOURCE Glory Star New Media Group Holdings Limited

FAQ

What were Glory Star's total revenues for the year 2022?

Glory Star's total revenues for the year 2022 were $157.1 million.

How much did Glory Star earn in net income for 2022?

Glory Star reported a net income of $26.4 million for the year 2022.

What is the current status of the CHEERS App downloads?

As of December 31, 2022, downloads of the CHEERS App reached approximately 377 million.

What growth did Glory Star's advertising revenue see in 2022?

Advertising revenue increased to $152 million in 2022, a 14.4% increase from the previous year.