CDC Corporation Reiterates Second Half 2008 Guidance
CDC Corporation (NASDAQ:CHINA - News), a leading global enterprise software and new media company, today reiterated its second half guidance for 2008. On September 16, 2008, CDC Corporation announced that based on preliminary financial projections and estimates, the company expects Adjusted EBITDA for the second half of 2008 to be in the range of approximately (U.S.)$10.0 million to (U.S.)$12.5 million, compared to approximately (U.S.)$1.4 million for the same period in 2007. This previously issued guidance represented an increase of up to 25 percent over the amounts set forth in the company’s earlier guidance issued on August 26, 2008, which estimated that Adjusted EBITDA for the second half of 2008 would be approximately (U.S.)$8.0 million to (U.S.)$10.0 million.
“Despite the global economic slowdown and unfavorable foreign exchange rates, we are very pleased to reiterate our previously issued second half 2008 guidance, which was already an increase over our earlier guidance provided a few months ago,” said Peter Yip, CEO of CDC Corporation. “We remain cautiously optimistic with regard to our performance due to the fact that, among other things, we have a highly recurring revenue stream from our installed customer base, including our maintenance revenues.
“Also, the company continues to have significant reserves of non-GAAP cash and cash equivalents. For example, as we last reported on August 7, 2008, CDC Corporation finished Q2 2008 with non-GAAP cash and cash equivalents of more than (U.S.)$230 million and generated positive operating cash flow in both Q1 2008 and Q2 2008 of (U.S.)$5.3 million and (U.S.)$5.6 million, respectively. We believe we will continue to generate positive cash from operations. The company also believes it is in an extremely fortunate position to have such significant cash and cash equivalent reserves to assist us in weathering this difficult economic environment.
“Our singular focus continues to be our commitment to serving our customer base. As such, I have personally met with several key customers throughout the world. Customers have specifically told me that our solutions are helping them directly address the challenges of running their business in today’s very difficult business environment. For example, our CRM solutions are helping customers manage and retain their customers through improved customer service and increasing business transparency. Our manufacturing and supply chain customers are using our solutions as critical operating tools to help better manage their business and protect their margins due to surging costs in commodities, energy and transportation.” Q3 2008 Earnings Release CDC Corporation intends to report its Q3 2008 results in the first half of November 2008.
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