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51job Reports Q2 Financial Results

Chinese online job recruitment firm 51job.com (JOBS) announced its unaudited financial results for the second quarter of 2006 ended June 30, 2006.

Total revenues increased 17.6% over Q2 2005 to CNY173.4 million, and gross margin increased to 56.0% compared with 50.2% in Q2 2005.

Commenting on the results, Rick Yan, President and Chief Executive Officer of 51job, said, "We are pleased that we achieved revenues and profitability within our expectations for the second quarter. We achieved solid growth in our online recruitment services business in the second quarter by successfully attracting new employers to the online platform, consistently delivering tangible results to HR managers and providing job seekers with the largest and most up-to-date jobs database in China."

Print advertising revenues for the second quarter of 2006 increased 7.2% to CNY97.1 million compared with CNY90.5 million for the same quarter in 2005. The company says the increase was primarily due to a decrease in price discounts for recruitment advertisements placed in 51job Weekly in some cities and price increases for certain products in select markets.

The estimated number of print advertising pages generated in the second quarter of 2006 was 3,068 compared with 3,191 pages in the same quarter in 2005. Average revenue per page in the second quarter of 2006 increased 11.5% over the second quarter of 2005 due to higher pricing.

Online recruitment services revenues for the second quarter of 2006 were CNY55.1 million, representing a 41.7% growth from CNY38.9 million for the same quarter last year. The increase was principally attributable to greater customer demand for online recruitment services resulting in a higher number of employers using the company's online services. Unique employers using the company's online recruitment services increased to 43,891 in the second quarter of 2006 compared with 31,098 in the same period last year.

Gross profit for the second quarter of 2006 was CNY91.8 million, representing an increase of 31.3% from CNY69.9 million for the same quarter last year. Gross margin was 56.0% in the second quarter of 2006 compared with 50.2% in the same quarter in 2005. The increase in gross margin was mainly due to greater economies of scale, higher prices we charged for print advertising compared with the same period last year and increased revenue contribution from the online services business.

Operating expenses for the second quarter of 2006 were CNY62.4 million compared with CNY51.5 million for the same period last year.

Income from operations for the second quarter of 2006 increased 60.0% to CNY29.4 million from CNY18.4 million for the same period last year.

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