Embattled Chinese technology firm PacificNet (PACT.PK) has finally reported its unaudited results for the fourth quarter and fiscal year ended December 31, 2006.
The company posted a huge fourth quarter loss of US$19,967,000 on revenue of US$10.4 million, conveniently blaming new Chinese mobile regulations for the outcome.
"As we first announced during the last earnings conference call for Q3 2006, PacificNet has initiated a rapid business transformation away from the low-margin telecom business and into the new high-margin gaming business," said Tony Tong, chairman and CEO of PacificNet. "Our goal is to streamline our operation, downsize the non-performing legacy operations, and simplify our business strategy with an emphasis on our new focus on gaming technology development. In recent board and management meetings, we evaluated the early success of our gaming technology operation and were satisfied with the rapid progress and financial performance of the gaming operation. The board of directors and management team have approved our new strategy to focus on the rapidly growing gaming market in greater China, Macau, and Asia. With the help of professional financial advisors and bankers, PacificNet will be seeking strategic alternatives for our low-margin telecom business units which may include sales, disposition, spin-offs and mergers."
Total revenues for the year ended December 31, 2006 were US$42,738,000 which represented an increase of 148.7% as compared to revenues of US$17,186,000 for the same period in 2005. Operating loss for the year ended December 31, 2006 was US$14,965,000.