Acorn International Enjoys Strong Business in Third Quarter, Expects Continuing Profitability
The Chinese marketing and e-commerce company reported improved revenue and income for the third quarter.
Acorn International Inc. (NYSE: ATV) has announced strong sales and income for the third quarter, as well as advancement in the expansion of the company with new clients and partners.
The Shanghai-based marketing and branding company, which develops, promotes, and sells self-branded and third-party products through e-commerce channels in China, reported Tuesday that it enjoyed another strong quarter during the three months through September. In response, shares in Acorn jumped more than 8 percent to $27.93 per American depositary share yesterday. (Stock markets were closed in New York today in observance of a federal day of mourning for former president George H.W. Bush.)
Revenue reached $8.3 million during the third quarter, up 38 percent year-over-year, Acorn said. Income was $3.8 million compared with $2.3 million a year ago. The company did not report per share earnings.
Operating expenses decreased 1 percent to $4.6 million, while costs of revenue were $2.2 million, up 34 percent from a year ago, according to the report.
"We've turned the corner on profitability, and we expect to continue," Acorn's chief executive officer, Jacob Fisch, said in a call with analysts on Tuesday.
He also said that Acorn Entertainment has attracted clients among U.S. celebrities in sports, film, TV, and music during the third quarter. He added that sales in Acorn Fresh, its frozen seafood business, "have been ramping," while the sales of its Babaka brand products remained strong, same as in the second quarter.
"Just a few weeks ago, we signed a cooperation agreement with media powerhouse, Shanghai Media Group," Fisch said. "And we are hopeful that it will allow additional opportunities for Acorn Entertainment's celebrity clientele and streaming content to reach Chinese audiences. We expect this focus on new media in China, along with further expansion of our e-commerce business, to drive our growth."
The company also said during Singles' Day, China's annual retail event, which took place on Nov. 11, it enjoyed sales of $2 million, up 74 percent year-over-year.
During the third quarter, Acorn has reacquired 65,067 of its ADSs at an average price of $19.96 under its share repurchase program, it said.
As of Sept. 30, the company had $15.7 million in cash, cash equivalents, and restricted cash, it reported.