Focus Media Reports EPS In-Line; Guides Below Consensus; Announces Acquisition; Stock Down 9% in After-Hours Trading (FMCN)

Focus Media (ticker: FMCN) reported Q4 2005 earnings results earlier today. The company also announced the acquisition of mobile-phone advertising service provider Dotad. (NOTE: We will be posting a transcript of tonight's management conference call shortly after its conclusion.) Key stats from Q4:

Q4 2005 Results:

Revenue rose 109.1% y-o-y to $24.6 million, (and rose 26.4% sequentially), above consensus estimates of $22.6 million.

Advertising service revenue rose 117.0% y-o-y to $24.1 million, and rose 25.9% sequentially.

Advertising service revenue from commercial location network rose 87.1% y-o-y to $20.7 million, and rose 19.9% sequentially.

Advertising service revenue from in-store network rose 82.9% sequentially to $3.3 million.

In-store network contributed 13.8% of Q4 advertising revenue vs 9.5% in Q3 2005.

Net income was $9.4 million, compared to a loss of $1.3 million in Q4 2004. Net income rose 32.2% sequentially.

Net income excluding non-cash share-based compensation expenses and amortization of intangible assets resulting from acquisitions (non-GAAP) was $9.6 million.

Fully diluted EPS of $0.23 in-line with consensus estimates.

Commercial Location Network:

Average advertising revenue per 30-second equivalent time slot ("ASP") for the entire network rose 9.4% sequentially to $4,461.

ASP from Tier-I Cities rose 15.8% sequentially to $10,553.

ASP from Tier-II Cities rose 10.0% sequentially to $2,045.

Q1 2006 Guidance:

Revenue of $28 - $30 million, below consensus estimates of $31.2 million.

Net income excluding share-based compensation expenses and amortization of intangible assets resulting from acquisitions is expected to be between $8.7 - $9.1 million.

FY 2006 Guidance:

Capital expenditures of approximately $20 million.

Total share-based compensation expenses of approximately $3.7 million.