China Digital TV used the occasion of its Q2 numbers by saying that it was working to regain its position on the New York Stock Exchange. The NYSE has started the delisting process for China Digital because the average trading price in the Chinese company’s shares has fallen below the Exchange’s continued listing requirements. China Digital is appealing the process and its appeal will be heard in October.
China Digital TV’s net revenues increased by 34.5 per cent to $1.3 million from $0.9 million in the prior year period. The increase in net revenues was primarily due to the increased product revenues during the quarter.
Gross profit in the second quarter of 2017 was $0.6 million, which was slightly lower than the prior year period. Gross margin, which is equal to gross profit divided by net revenues, was 47.9 per cent in the second quarter of 2017, as compared with 68.9 per cent in the prior year period. The decline in gross margin was mainly due to an increased proportion of revenues from products during the quarter, which have a relative lower gross margin than services.
As of June 30th 2017, China Digital TV had cash and cash equivalents and term deposits totalling $27.6 million, as compared to $125.5 million as of March 31st 2017. The decrease was primarily due to the payment of a special dividend of $1.5 per ordinary share, representing a total cash dividend paid in June 2017 of $100.3 million.
Zhenwen Liang, China Digital TV’s chief financial officer, stated, “In the second quarter of 2017, the number of covered users on our cloud platform increased to 160 million. The growth was primarily attributable to the partnership we established with Taiyuan Radio and Television, enabling our expansion into the Shanxi province. We continue to evolve our strategic focus and positioning to maximise the performance of our operations and are confident we will further solidify our position as China’s leading provider of cloud platforms.”