appConfigEntityId

bodyType

customContents

entityId

entityUuid

isVideo

articlePageQuery

article

articleSchemaContent

content

hooksArticlePageAdvertisementConfigArticle

appConfig

filter

json

liveArticle

SCMP Reporter

Internet portal operator hongkong.com has announced a net profit of HK$28.44 million for last year, up from HK$4.41 million in 2000.

However, last year's profitable result was due largely to HK$96.42 million in interest income generated from a HK$1.22 billion cash reserve raised when the company floated its shares on the second board in March 2000, before the Internet bubble burst.

Stripping out the non-operational gain, hongkong.com's core business lost HK$67.98 million last year.

On a quarterly basis, hongkong.com posted a net profit of HK$12.5 million for the three months to December 31, compared with a net profit of HK$1.65 million for the July-September quarter.

Turnover for the fourth quarter rose 60.1 per cent quarter on quarter to reach HK$22.22 million.

Shares in hongkong.com rose as much as 4.5 HK cents, or 13.6 per cent, yesterday to an intra-day high of 37.5 HK cents. However, the gain eased to 6 per cent when the counter finally settled at 35.5 HK cents.

Hongkong.com chief executive Rudy Chan Kai-yu said the surge in fourth-quarter revenue had been contributed to by its offline businesses. The company earned strong advertising revenue from its travel magazine publishing group, Travel Trade Gazette Asia (TTG Asia).

The firm's newly acquired mainland ticketing solutions provider Times Software also turned a profit.

As with many other Chinese Internet companies such as Tom.com, Sina.com and Sohu.com, hongkong.com has been struggling to find online advertising revenue. As a result, Internet firms are fighting to survive by purchasing offline businesses.

Mr Chan said: 'Purely selling online advertising is not going to work anymore. We need to [create a] package including other traditional advertising media that our advertisers are familiar with to gain their trust.'

Sitting on HK$1.22 billion in cash, Mr Chan said hongkong.com was still looking for acquisition opportunities in other traditional media areas, as well as offline business possibilities, to help boost the company's earnings.

Since listing in March 2000, hongkong.com has invested about HK$50 million in acquisitions, including TTG Asia, forming a travel joint venture Travio Global with a Taiwanese travel agent, and Times Software.

Rival Tom.com is making similar moves, aggressively acquiring media and advertising businesses in Taiwan and China to shift from being an Internet company to a media and advertising operator.

Having already suffered economically for almost two years, Mr Chan said the outlook for the online advertising sector, especially in Hong Kong, would remain tough.

He said the forecast for advertising revenue this quarter would be sluggish as January-March was the low season in Hong Kong.

Meanwhile, hongkong.com said its online travel business had picked up in Taiwan with more than 50 major hotels on the island signing up with the company's hotel booking platform, PowerHotel.



Hongkong.com earnings exceed $28m