Holmes Report 16 Mar 2016 // 8:14AM GMT
BEIJING — BlueFocus Communication Group, the Chinese holding company that owns BlueDigital, Citizen Relations and We Are Social, has reported a 51.7% decline in operating profit in 2015.
The preliminary results reveal that revenues grew by 44.3% to RMB 8.6bn (US$1.3bn), which the group attributed to "the initial achievements of...digitization and globalization" along with organic digital growth.
The decline in profits come after trading in BlueFocus shares was temporarily suspended last year. Total operating profit was roughly RMB 447.7m down 149.1% compared to one year ago; excluding long term asset depreciation, operating profit decreased by 51.7% to RMB 440.2m. Total profit declined 87% to approximately RMB 123.4m in 2015 while the
net profit attributed to equity holders was down by 90.5% to RMB 67.4m.
The group blamed poor profitability on three factors: a "significant increase" in finance expenses "due to high level of liability with interest resulted from bank loans and bond issues"; continued investment in digital and other emerging business fields which are yet to turn profitable; and, long term asset depreciation of up to RMB 887.9m on subsidiaries Bojie, Kingo, and We Are Social, "driven by their market change and business adjustment in 2015, which eventually left a huge impact on the profit."
BlueFocus' preliminary results do not include sector breakouts for specific business units; these will follow next month.