Xinhua Finance Limited (TSE: 9399) Reports Its Results for the First Nine Months of 2008

SHANGHAI, China, Nov. 28 /PRNewswire-Asia-FirstCall/ -- Xinhua Finance Limited ("XFL", or "the Company", TSE Mothers: 9399 and OTC: XHFNY), China's premier financial information service provider, today reported consolidated revenue for the nine months ended September 30, 2008, under International Financial Reporting Standards ("IFRS"), of US$213.2 million, an 18% increase over the same period in 2007.

(Logo: http://www.xprn.com/xprn/sa/200702151700.gif )

Revenue growth was mainly driven by the Company's China operations, which contributed US$159 million or 75% of total revenue, up 53% year on year. Proforma EBITDA, adjusted to exclude non-cash ESOP expenses and one-time items, increased to US$44.2 million versus US$36.1 million in the corresponding period in 2007. Adjusting for the divestiture or discontinuation of certain businesses in 2008 and 2007, revenue from continuing operations increased 40%, from US$136.5 million to US$191.3 million, and Proforma EBITDA increased 32%, from US$30.8 million to US$40.6 million.

During the first nine months of 2008, the Company incurred higher non-cash ESOP expenses, higher selling and marketing expenses and higher costs for Sarbanes-Oxley compliance from its Distribution subsidiary, Xinhua Finance Media Limited ("XFMedia"), versus the prior year. The Company also made one- time provisions for goodwill impairments totaling US$81 million primarily resulting from the sales of certain of its US assets. In addition, XFMedia recorded a US$16.5 million impairment provision relating to a US$25 million principal guaranteed note purchased from UBS Financial Services. The note was issued by Lehman Brothers Holdings, which filed for bankruptcy in mid- September of this year.

Due mainly to the aforementioned impairments, the Company generated a net loss for the first nine months of the year of US$106.4 million. On a Proforma basis, after excluding non-cash and one-time items, Proforma net income was US$5.1 million compared to that of US$2.3 million for the first nine months of 2007.  Proforma results are provided by the Company to help investors better understand underlying operating and financial trends.

During the past few months, the Company has taken strategic actions to focus on the China market, its core competency. In July, the Company sold its Mergent and Kinetic subsidiaries, and in November sold the assets of the G7 Group as well as its joint alliance interest in Xinhua PR Newswire. Additionally, the Company signed an agreement to sell its US-based subsidiary Washington Analysis and expects such transaction to close in December 2008. XFL CEO Mr. Jae Lie said, "We are making very good progress in restructuring our company as outlined earlier in the year. The sales of these assets are in line with our overall strategy to streamline and focus on our core business and competency which is the provision of proprietary and value-added information of China's financial markets."

In September 2008, the Company completed the redemption of approximately US$49 million of its 10% Senior Guaranteed Notes due 2011 (the "Notes"). The Company intends to redeem additional Notes with asset sale proceeds in accordance with the terms of the Notes.  XFL CFO Mr. David Wang said, "We are pleased with the progress of our disposal of non core assets and we see these changes as positive steps towards gaining financial flexibility. As we draw closer to the end of 2008 we will continue to pursue strategies that will improve our shareholder value."

  YTD Q3 2008 vs. YTD Q3 2007 (IFRS) -- unit: USD million

                     YTD Q3 2008     YTD Q3 2007    Variance
  Revenue                  213.2           180.7         18%
  Proforma EBITDA(1)        44.2            36.1         22%
  EBITDA                   -70.5            26.1          NA
  Proforma Net Income(2)     5.1             2.3        121%
  Net Income              -106.4            85.9          NA

  Continuing Operations  (3)
  YTD Q3 2008 vs. YTD Q3 2007 (IFRS) -- unit: USD million

                     YTD Q3 2008     YTD Q3 2007    Variance
  Revenue                  191.3           136.5         40%
  Proforma EBITDA(1)        40.6            30.8         32%



(1) Proforma EBITDA is EBITDA excluding non-cash share-based compensation expense and excluding one time items.

(2) Proforma Net Income is calculated by taking net income and excluding non cash share-based compensation expenses, one time non recurrent items, amortization arising from acquisitions and non-cash imputed interest.

(3) Due to changes in the composition of our business as a result of the divestiture or discontinuation of certain subsidiaries, we also present results from continuing operations.

(Notes)

A. We define EBITDA in relation to our IFRS financial statements as profit or loss before interest expense, tax, depreciation and amortization.

About Xinhua Finance Limited

Xinhua Finance Limited ("XFL") is China's premier financial information service provider and is listed on the Mothers Board of the Tokyo Stock Exchange (symbol: 9399) (OTC ADRs: XHFNY). Bridging China's financial markets and the world, Xinhua Finance's proprietary content platform, comprising Indices, Ratings, Financial News, and Investor Relations, serves financial institutions, corporations and re-distributors worldwide.  Through its subsidiary Xinhua Finance Media Limited (NASDAQ:XFML), XFL leverages its content across multiple distribution channels in China including television, radio, newspaper, magazine and outdoor media. Founded in November 1999, XFL is headquartered in Shanghai, with offices and news bureaus spanning 11 countries worldwide.

For more information, please visit ttp://www.xinhuafinance.com .

This is a press release to the public and should not be relied on as information to make an investment decision by any investor. Investors should read the Company's Securities Report filed to the Tokyo Stock Exchange and consider the risk factors together with other information contained therein when making an investment decision. This press release contains some forward- looking statements that involve a number of risks and uncertainties. A number of factors could cause actual results, performance, achievements of the Company or industries in which it operates to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements.

  More Information:

  Media Contact

   Xinhua Finance
   Shanghai
   Ms. Joy Tsang
   Tel:   [phone] or [phone]
   Email: 

  IR Contact

   Xinhua Finance
   Hong Kong
   Mr. Charles Lau
   Tel:   [phone]
   Email: 

DATASOURCE: Xinhua Finance Limited



Contact: Ms. Joy Tsang, [phone] or [phone],

; Mr. Charles Lau, [phone],

 



Web Site: http://www.xinhuafinance.com/

http://www.xprn.com/xprn/sa/200702151700.gif 

Copyright