0001104659-15-080345.txt : 20151120 0001104659-15-080345.hdr.sgml : 20151120 20151120061735 ACCESSION NUMBER: 0001104659-15-080345 CONFORMED SUBMISSION TYPE: 6-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20151130 FILED AS OF DATE: 20151120 DATE AS OF CHANGE: 20151120 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Ku6 Media Co., Ltd CENTRAL INDEX KEY: 0001294435 STANDARD INDUSTRIAL CLASSIFICATION: COMMUNICATION SERVICES, NEC [4899] IRS NUMBER: 000000000 STATE OF INCORPORATION: E9 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 6-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-51116 FILM NUMBER: 151244953 BUSINESS ADDRESS: STREET 1: BUILDING 6, ZHENGTONGCHUANGYI CENTRE STREET 2: NO. 18 XIBAHE XILI, CHAOYANG DISTRICT CITY: BEIJING STATE: F4 ZIP: 100028 BUSINESS PHONE: 86-10-5758-6818 MAIL ADDRESS: STREET 1: BUILDING 6, ZHENGTONGCHUANGYI CENTRE STREET 2: NO. 18 XIBAHE XILI, CHAOYANG DISTRICT CITY: BEIJING STATE: F4 ZIP: 100028 FORMER COMPANY: FORMER CONFORMED NAME: Hurray! Holding Co., Ltd. DATE OF NAME CHANGE: 20040619 6-K 1 a15-23759_16k.htm 6-K

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.20549

 

FORM 6-K

 

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE

SECURITIES EXCHANGE ACT OF 1934

 

For the month of: November 2015

 

Commission File Number: 000-51116

 

Ku6 Media Co., Ltd.

(Exact name of registrant as specified in its charter)

 

Building 6, Zhengtongchuangyi Centre
No. 18, XibaheXili, Chaoyang District,
Beijing 100028, People’s Republic of China

Fax number: +86 10 5758-6834

(Address of principal executive offices)

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

 

Form 20-F x

 

Form 40-F o

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): o

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): o

 

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.  Yes o  No x

 

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-N.A.

 

 

 



 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

 

Ku6 Media Co., Ltd.

 

 

 

 

 

By:

/s/ Jason Ma

 

Name:

Jason Ma

 

Title:

Acting Chief Financial Officer

 

 

 

Date:  November 20, 2015

 

 

 

2



 

EXHIBIT INDEX

 

Exhibit No.

 

Description

 

 

 

99.1

 

Press release

 

3


EX-99.1 2 a15-23759_1ex99d1.htm EX-99.1

Exhibit 99.1

 

GRAPHIC

 

Ku6 Media Reports Unaudited Financial Results

 

For the Third Quarter of Fiscal Year 2015

 

BEIJING, China, November 20, 2015 — Ku6 Media Co., Ltd. (“Ku6 Media” or the “Company,” NASDAQ: KUTV), a leading internet video company focused on User Generated Content (“UGC”) in China, today announced its unaudited financial results for the third quarter ended September 30, 2015.

 

Management Comments

 

Mr. Feng Gao, Chief Executive Officer of Ku6 Media, commented, “The third quarter represented a period of advancement in our services, as well as positive trends in our financials. We have consistently seen user expansion as individuals are providing a wider variety of content on our platform. Ku6 is focusing on the trend toward video social communication with the creation of our ‘Model Interactive Community’. We are also expanding our share of the mobile market through the launching of the mobile application ‘Modo’, which is part of our cooperation agreement with Beijing Modo. Ultimately, our goal is to continue to increase user traffic while simultaneously enhancing our advertising partnerships. In the third quarter, we have increased revenues and continued to progress towards profitability, and have been pleased with our current trends heading into 2016.”

 

Third Quarter 2015 Highlights (1)

 

·                      Total revenues were US$2.45 million (RMB15.46 million) in the third quarter of 2015, as compared to total revenues of US$2.38 million in the second quarter of 2015 and US$1.62 million in the third quarter of 2014.

 

·                      Net loss was US$0.64 million (RMB4.03 million) in the third quarter of 2015, as compared to a net loss of US$0.67 million in the second quarter of 2015 and US$0.93 million in the third quarter of 2014.

 

·                      Basic and diluted loss per ADS was US$0.01 (RMB0.09) in the third quarter of 2015, as compared to US$0.01 in the second quarter of 2015 and US$0.02 in the third quarter of 2014.

 

·                      Cash and cash equivalents were US$7.91 million (RMB50.25 million) as of September 30, 2015.

 

·                      Net cash used in operating activities was US$0.32 million (RMB 1.97 million) in the third quarter of 2015, as compared to net cash provided by operating activities of US$0.78 million in the second quarter of 2015 and net cash used in operating activities of US$3.00 million in the third quarter of 2014.

 


(1)         The reporting currency of the Company is the United States dollar (“U.S. dollar”), but solely for the convenience of the reader, the amounts of Renminbi (“RMB”) presented throughout the release were calculated at the rate of US$1.00=RMB6.3556, representing the noon buying rate as of September 30, 2015 in the City of New York for cable transfers of RMB as certified for customs purposes by the Federal Reserve Bank of New York. This convenience translation is not intended to imply that the U.S. dollar amounts could have been, or could be, converted, realized or settled into RMB at that rate on September 30, 2015 or at any other rate.

 

1



 

Recent Business Developments

 

Company Extends Advertising Agency Agreement with Partner Huzhong

 

On August 29, 2015, the Company entered into a supplemental advertising agency agreement with Huzhong Advertising (Shanghai) Ltd. (“Huzhong”), pursuant to which the service price charged to Huzhong increased by a certain percentage in the following 12 months before the next price negotiation may occur. There were no other changes to the existing advertising agency agreement, which will expire on December 31, 2017.

 

Business Expansion Into Video Social Communication

 

In July 2015, the Company entered into agreements with two third parties to set up a new media company, Beijing Modo Media Co., Ltd. (“Beijing Modo”), in which Ku6 Media holds a 30% equity interest. Beijing Modo operates a social platform named “Modo” that allows users to engage in real-time online group activities through voice, text and video. Users on the Modo platform may consume virtual items during real-time video broadcasting, including gifts and avatars, and purchase other value-added services. The Company contributes business skills and technical support to Beijing Modo.

 

Third quarter 2015 Financial Results

 

Total revenues were US$2.45 million (RMB15.46 million) in the third quarter of 2015, representing an increase of 2.9% from US$2.38 million in the second quarter of 2015 and an increase of 51.8% from US$1.62 million in the third quarter of 2014. The Company reported higher revenues due to increased rate and volume from its advertising partner compared to the prior year.

 

Cost of revenues was US$2.05 million (RMB12.92 million) in the third quarter of 2015, representing a decrease of 5.3% from US$2.17 million in the second quarter of 2015 and a decrease of 17.4% from US$2.48 million in the third quarter of 2014.

 

The decrease in cost of revenues, as compared to the third quarter of 2014, was primarily due to (a) a decrease in bandwidth costs by US$0.18 million as we optimized bandwidth efficiency in 2015; (b) a decrease of depreciation costs by US$0.15 million as certain fixed assets were fully depreciated in the third quarter of 2015. These factors also contributed to the decrease from the second quarter of 2015.

 

Gross profit was US$0.40 million (RMB2.54 million) in the third quarter of 2015, as compared to gross profit of US$0.22 million in the second quarter of 2015 and gross loss of US$0.87 million in the third quarter of 2014.

 

Operating expenses were US$1.01 million (RMB6.36 million) in the third quarter of 2015, as compared to US$1.06 million in the second quarter of 2015, representing a decrease of 4.4%. Operating expenses reflected a decrease of 36.9% from US$1.60 million in the third quarter of 2014.

 

The decrease in operating expenses, as compared to the third quarter of 2014, was mainly attribute to (a) a decrease of office rental expenses by US$0.18 million as we reduced office space in the second quarter of 2015, and (b) a reversal of US$0.24 million of accrued litigation expenses in the third quarter of 2015, as compared to a reversal of US$0.04 million incurred in the third quarter of 2014. This reversal contributed to the decrease in operating expenses from the second quarter of 2015 as well.

 

2



 

Operating loss was US$0.61 million (RMB3.82 million) in the third quarter of 2015, as compared to operating loss of US$0.84 million in the second quarter of 2015 and US$2.47 million in the third quarter of 2014.

 

Net loss was US$0.64 million (RMB4.03 million) in the third quarter of 2015, as compared to US$0.67 million in the second quarter of 2015 and US$0.93 million in the third quarter of 2014.

 

Net loss per basic and diluted ADS was US$0.01 (RMB0.09) in the third quarter of 2015, as compared to US$0.01 in the second quarter of 2015 and US$0.02 in the third quarter of 2014. Weighted average ADSs used to calculate basic and diluted net loss per ADS were 47.7 million in the third quarter of 2015, 47.6 million in the second quarter of 2015 and 47.6 million in the third quarter of 2014.

 

Balance Sheet Highlights

 

As of September 30, 2015, the Company had US$7.91 million (RMB50.25 million) in cash and cash equivalents, as compared to US$4.38 million as of December 31, 2014. The increase was primarily attributable to a loan of US$4.84 million extended from Mr. Xudong Xu, our previous significant shareholder in March 2015. On May 12, 2015, following our change of ownership, the US$4.84 million loan was assumed by Shanda Computer (Shanghai) Co., Ltd (“Shanda Computer”), a wholly-owned subsidiary of Shanda Interactive Entertainment Limited.

 

About Ku6 Media Co., Ltd.

 

Ku6 Media Co., Ltd. (NASDAQ: KUTV) is a leading internet video company in China focused on User Generated Content (“UGC”). Through its premier online brand and online video website, www.ku6.com, Ku6 Media provides online video uploading and sharing services, video reports, information and entertainment in China. For more information about Ku6 Media, please visit http://ir.ku6.com.

 

3



 

Forward-looking Statements

 

This news release contains statements of a forward-looking nature. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. You can identify these forward-looking statements by terminology such as “believes,” “could,” “expects,” “may,” “might,” “should,” “will,” or “would,” and by similar statements. Forward-looking statements are not historical facts, but instead represent only the Company’s beliefs regarding future events, many of which, by their nature, are inherently uncertain and outside of its control. It is possible that the Company’s actual results and financial condition may differ, possibly materially, from the anticipated results and financial condition indicated in these forward-looking statements. Some of the risks and important factors that could affect the Company’s future results and financial condition include: continued competitive pressures in China’s internet video portal market; changes in technology and consumer demand in this market; the risk that Ku6 Media may not be able to control its expenses in the future; regulatory changes in China with respect to the operations of internet video portal websites; the ability of the Company to consistently derive revenues from its renewed agreement with Huzhong; the success of Ku6 Media’s ability to sell advertising and other services on its websites; and other risks outlined in the Company’s filings with the Securities and Exchange Commission, including the Company’s annual report on Form 20-F. Ku6 Media does not undertake any obligation to update this forward-looking information, except as required under law.

 

Contact:

For further information, please contact:

 

At the Company:

Ms. Wendy Xuan

Investor Relations Manager
Telephone: +86 10 5758 6819
ir@ku6.com

 

Investor Relations:

The Equity Group Inc.

Ms. Katherine Yao,

Senior Associate

Telephone: +86 10 6587 6435

kyao@equityny.com

 

4



 

Ku6 Media Co., Ltd.

Consolidated Balance Sheets

 

 

 

December

 

September
30,

 

September
30,

 

(Amounts in thousands,

 

31, 2014

 

2015

 

2015

 

except for number of shares)

 

US$

 

US$

 

RMB

 

 

 

 

 

(Unaudited)

 

(Unaudited)

 

ASSETS

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

Cash and cash equivalents

 

4,380

 

7,906

 

50,250

 

Accounts receivable, net

 

114

 

84

 

536

 

Accounts receivable due from related parties

 

1

 

23

 

147

 

Prepaid expenses and other current assets

 

490

 

570

 

3,623

 

Other receivables due from related parties

 

3

 

3

 

18

 

Total current assets

 

4,988

 

8,586

 

54,574

 

Non-current assets:

 

 

 

 

 

 

 

Property and equipment, net

 

294

 

32

 

206

 

Investment in equity affiliate

 

 

177

 

1,127

 

Deposits and other non-current assets

 

348

 

 

 

TOTAL ASSETS

 

5,630

 

8,795

 

55,907

 

 

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ DEFICIT

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

Accounts payable

 

3,076

 

3,165

 

20,116

 

Accounts payable due to related parties

 

710

 

615

 

3,909

 

Accrued expenses and other current liabilities

 

5,980

 

5,894

 

37,472

 

Related party loan payable

 

 

4,720

 

30,000

 

Total liabilities

 

9,766

 

14,394

 

91,497

 

 

 

 

 

 

 

 

 

Shareholders’ deficit:

 

 

 

 

 

 

 

Ordinary shares (US$0.00005 par value; 12,000,000,000 shares authorized; 4,763,360,860 and 4,771,610,860 shares issued and outstanding as of December 31, 2014 and September 30, 2015, respectively)

 

238

 

239

 

1,516

 

Additional paid-in capital

 

184,538

 

185,025

 

1,175,944

 

Accumulated deficit

 

(187,096

)

(189,230

)

(1,202,670

)

Accumulated other comprehensive loss

 

(1,816

)

(1,633

)

(10,380

)

Total shareholders’ deficit

 

(4,136

)

(5,599

)

(35,590

)

TOTAL LIABILITIES AND SHAREHOLDERS’ DEFICIT

 

5,630

 

8,795

 

55,907

 

 

5



 

Ku6 Media Co., Ltd.

Consolidated Statements of Operations

 

 

 

For the Three Months Ended

 

For the Nine Months Ended

 

(Amounts in thousands, except for 

 

September
30,

 

June 30,

 

September
30,

 

September
30,

 

September
30,

 

September
30,,

 

September 30,

 

number of shares and ADS and per 

 

2014

 

2015

 

2015

 

2015

 

2014

 

2015

 

2015

 

share and per ADS data)

 

US$

 

US$

 

US$

 

RMB

 

US$

 

US$

 

RMB

 

 

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third parties

 

924

 

2,384

 

2,413

 

15,212

 

1,722

 

7,145

 

44,563

 

Related parties

 

692

 

 

40

 

251

 

3,396

 

40

 

251

 

Total revenues

 

1,616

 

2,384

 

2,453

 

15,463

 

5,118

 

7,185

 

44,814

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third parties

 

2,245

 

1,937

 

1,835

 

11,564

 

9,057

 

5,607

 

34,959

 

Related parties

 

238

 

228

 

215

 

1,358

 

698

 

657

 

4,101

 

Total cost of revenues

 

2,483

 

2,165

 

2,050

 

12,922

 

9,755

 

6,264

 

39,060

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross profit / (loss)

 

(867

)

219

 

403

 

2,541

 

(4,637

)

921

 

5,754

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Product development

 

18

 

 

 

 

1,377

 

 

 

Sales and marketing

 

146

 

272

 

288

 

1,814

 

768

 

752

 

4,690

 

General and administrative

 

1,436

 

784

 

722

 

4,550

 

6,068

 

2,441

 

15,214

 

Total operating expenses

 

1,600

 

1,056

 

1,010

 

6,364

 

8,213

 

3,193

 

19,904

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating loss

 

(2,467

)

(837

)

(607

)

(3,823

)

(12,850

)

(2,272

)

(14,150

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

6

 

61

 

52

 

329

 

35

 

127

 

798

 

Other income

 

77

 

189

 

5

 

32

 

674

 

206

 

1,266

 

Interest expense - related party loan

 

 

(78

)

(79

)

(498

)

 

(183

)

(1,142

)

Gain from disposal of equity interest in affiliates

 

1,452

 

 

 

 

1,452

 

 

 

Equity in loss of affiliate

 

 

 

(12

)

(73

)

 

(12

)

(73

)

Loss before income tax benefit

 

(932

)

(665

)

(641

)

(4,033

)

(10,689

)

(2,134

)

(13,301

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax benefit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

(932

)

(665

)

(641

)

(4,033

)

(10,689

)

(2,134

)

(13,301

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss per share - basic and diluted

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

US$

(0.00

)

US$

(0.00

)

US$

(0.00

)

RMB

(0.00

)

US$

(0.00

)

US$

(0.00

)

RMB

(0.00

)

Weighted average shares used in per share calculation — basic/diluted

 

4,755,993,958

 

4,764,014,706

 

4,771,610,860

 

4,771,610,860

 

4,740,312,505

 

4,766,392,341

 

4,766,392,341

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss per ADS - basic and diluted

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

US$

(0.02

)

US$

(0.01

)

US$

(0.01

)

RMB

(0.09

)

US$

(0.23

)

US$

(0.05

)

RMB

(0.28

)

Weighted average ADSs used in per ADS calculation — basic/diluted

 

47,559,940

 

47,640,147

 

47,716,109

 

47,716,109

 

47,403,125

 

47,663,923

 

47,663,923

 

 

6



 

Ku6 Media Co., Ltd.

Consolidated Statements of Cash Flows

 

 

 

For the Three Months Ended

 

For the Nine Months Ended

 

 

 

September 30,

 

June 30,

 

September 30,

 

September 30,

 

September 30,

 

September 30,

 

September 30,

 

 

 

2014

 

2015

 

2015

 

2015

 

2014

 

2015

 

2015

 

(Amounts in thousands)

 

US$

 

US$

 

US$

 

RMB

 

US$

 

US$

 

RMB

 

 

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

Cash flows from operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

(932

)

(665

)

(641

)

(4,033

)

(10,689

)

(2,134

)

(13,301

)

Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Share-based compensation expenses

 

169

 

59

 

78

 

494

 

457

 

213

 

1,333

 

Depreciation and amortization

 

253

 

107

 

73

 

462

 

847

 

292

 

1,817

 

Equity in loss of affiliated company

 

 

 

12

 

73

 

 

12

 

73

 

Bad debt provision

 

58

 

 

 

 

989

 

 

 

Gain on derecognition of aged operating liabilities

 

(9

)

 

 

 

(207

)

(14

)

(86

)

Exchange losses (gains)

 

(77

)

3

 

56

 

355

 

(34

)

30

 

177

 

Gain on disposal of property and equipment

 

 

(19

)

(24

)

(153

)

 

(114

)

(705

)

Gain from disposal of equity interest in affiliates

 

(1,452

)

 

 

 

(1,452

)

 

 

Changes in assets and liabilities, net of acquisitions and dispositions:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accounts receivable

 

(98

)

138

 

86

 

549

 

(994

)

29

 

196

 

Prepaid expenses and other current assets

 

(222

)

9

 

(116

)

(737

)

(136

)

(8

)

(65

)

Amount due from related parties

 

(711

)

 

(22

)

(141

)

5,623

 

(22

)

(141

)

Deposits and other non-current assets

 

 

348

 

 

 

(18

)

348

 

2,159

 

Accounts payable

 

(277

)

585

 

(351

)

(2,228

)

(572

)

91

 

516

 

Accrued expenses and other current liabilities

 

60

 

130

 

642

 

4,079

 

(1,191

)

(49

)

(204

)

Amount due to related parties

 

242

 

89

 

(108

)

(689

)

616

 

(120

)

(767

)

Net cash provided by (used in) operating activities

 

(2,996

)

784

 

(315

)

(1,969

)

(6,761

)

(1,446

)

(8,998

)

Cash flows from investing activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Purchases of property and equipment

 

 

(13

)

(1

)

(9

)

(192

)

(14

)

(88

)

Proceeds from disposal of property and equipment

 

 

19

 

24

 

153

 

 

114

 

705

 

Repayment of loans from related parties controlled by Shanda

 

 

 

 

 

484

 

 

 

Proceeds from disposal of equity interest in affiliates

 

1,452

 

 

 

 

1,452

 

 

 

Net cash provided by (used in) investing activities

 

1,452

 

6

 

23

 

144

 

1,744

 

100

 

617

 

Cash flows from financing activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Proceeds from exercise of stock options

 

77

 

13

 

 

 

339

 

13

 

80

 

Borrowings from related parties controlled by Shanda

 

 

 

 

 

5,797

 

4,839

 

30,000

 

Net cash provided by financing activities

 

77

 

13

 

 

 

6,136

 

4,852

 

30,080

 

Effect of exchange rate changes on cash and cash equivalents

 

 

(1

)

20

 

1,374

 

(17

)

20

 

1,371

 

Net increase (decrease) in cash and cash equivalents

 

(1,467

)

802

 

(272

)

(451

)

1,102

 

3,526

 

23,070

 

Cash and cash equivalents, beginning of period

 

4,240

 

7,376

 

8,178

 

50,701

 

1,671

 

4,380

 

27,180

 

Cash and cash equivalents, end of period

 

2,773

 

8,178

 

7,906

 

50,250

 

2,773

 

7,906

 

50,250

 

 

7


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