Tom Group's (TOMO) 2006 annual report, which was released on Tuesday, shows that the company's net profit dropped by 88% last year, and because of the huge loss within its sports-related services, they will stop the service this year and concentrate on other main services.
Tom Group says that the government's policy supervision on wireless value-added service and the changes of policies by relevant mobile phone operators in the second half of last year attributed to the loss for Tom Online, whose business revenue accounts for 47% of the group's total.
At the same time, the group's income from sports service declined by 45.6% as a result of the restructuring in first half of 2006. Tom Group says that it will sign agreements to sell some services this month and after that it will halt the sports service.
Despite the loss from the sports sector, Tom Group earned HK$98.67 million in net profit from publishing services last year. Traditional media seems to be keeping the wayward Internet company stable for the moment.