China-based CDC Corporation has just released its financial figures for the fourth quarter and year ended December 31, 2008, showing total annual revenue of USD409.1 million, an increase of 4% from USD394 million in 2007.
However, in the fourth quarter of 2008, CDC Corporation recorded a goodwill and intangible asset impairment charge of USD49.0 million and an impairment charge associated with its investments for sale of securities of USD8.5 million. With these charges, CDC Corporation reported a net loss from continuing operations of USD84.3 million and USD108.4 million for the fourth quarter and full year of 2008, respectively.
Peter Yip, CEO of CDC Corporation, stated: "We believe we are ahead of the curve in on our cost reduction efforts and have made several significant operational improvements in our business units throughout 2008, which helped us to achieve strong Adjusted EBITDA growth of 41% for the year ended December 31, 2008. Our margin expansion was accomplished primarily through improved staff utilization, the streamlining and tighter integration of acquired entities, improving cost management and leveraging an expanded offshore model in India and China for research and development. We have also seen maintenance renewal rates above-industry average and our maintenance win back program, started at the end of the third quarter of 2008, has demonstrated significant momentum generating more than USD619,000 by the end of 2008. We believe that our proactive strategies allowed us to exceed Wall Street consensus estimates for the last five quarters. In addition, we have made excellent progress with our convertible debt."
For the fourth quarter of 2008, revenues and Adjusted EBITDA from continuing operations, were USD96.2 million and USD8.0 million, respectively. This compares to revenue and Adjusted EBITDA of USD106.9 million and a loss of USD4.5 million, respectively, for the fourth quarter of 2007. Adjusted EBITDA for the second half of 2008 of USD20.3 million, exceeded the company's guidance of USD17.0 million to USD19.0 million, which was re-affirmed on February 4, 2009.
For the year ended December 31, 2008, total revenue and Adjusted EBITDA were USD409.1 million and USD28.7 million, respectively, compared to USD394.0 million and USD20.3 million for 2007.
CDC Corporation also generated positive operating cash flows in the fourth quarter of 2008, marking four consecutive quarters of cash generated from operations during the year. Operating cash flow was USD8.3 million in the fourth quarter of 2008 and was USD27.1 million for the full year ended December 31, 2008.
CDC Corporation runs a number of technology and software subsidiaries, including CDC Games, CDC Software, China.com Inc, and CDC Global Services.