Pop Culture Group Co., Ltd Reports Fiscal Year 2021 Financial Results
XIAMEN, China, Nov. 10, 2021 /PRNewswire/ — Pop Culture Group Co., Ltd (“Pop Culture” or the “Company”) (Nasdaq: CPOP), a hip-pop culture company in China, today announced its financial results for the fiscal year ended June 30, 2021.
Mr. Zhuoqin Huang, Chairman and Chief Executive Officer of Pop Culture, commented, “Despite the short-term impact to some of our businesses caused by the COVID-19 pandemic, we maintained solid upward momentum in fiscal year 2021. Our revenue recorded $25.5 million in fiscal year 2021, representing a 63% year-on-year increase from $15.7 million in fiscal year 2020. As a public company engaged in the hip-hop culture business, our intellectual property content (‘IP content’) is the key driver for our rapid financial growth. Our revenue from event hosting was $15.0 million in fiscal year 2021, an increase of 96% from $7.6 million in fiscal year 2020. At the same time, net income attributable to our shareholders was $4.3 million, an increase of 75% from $2.4 million in fiscal year 2020. Our gross margin and operating margin were 28% and 23%, respectively, in fiscal year 2021, which remained stable as compared to 29% and 20%, respectively, in fiscal year 2020.”
Mr. Huang continued, “We are very pleased to see that Pop Culture has achieved such outstanding results in fiscal year 2021, and we are very grateful to our customers and partners for their continued recognition and support. We will continue to focus on the operation and promotion of Chinese hip-hop cultural content. We have developed a new five-year strategic plan for our future development. According to the strategic plan, we will continue to put ‘IP content’ at the core of our business and strive to achieve sustained high growth in our three major businesses by utilizing the advantages of big data and capital markets, with a goal of becoming an industry leader.”
| For the fiscal year ended June 30, | |||||
| ($ millions, except per share data and percentages) | 2021 | 2020 | % Change | ||
| Revenue | 25.5 | 15.7 | 63% | ||
| Event hosting | 15.0 | 7.6 | 96% | ||
| Event planning and execution | 9.2 | 5.5 | 67% | ||
| Brand promotion | 0.8 | 2.2 | -67% | ||
| Other services | 0.6 | 0.3 | 87% | ||
| Gross Profit | 7.2 | 4.5 | 59% | ||
| Gross Margin | 28% | 29% | -1pp* | ||
| Income from Operations | 5.8 | 3.2 | 84% | ||
| Operating Margin | 23% | 20% | 3pp* | ||
| Net Income | 4.3 | 2.6 | 63% | ||
| Net Income Attributable to the Company’s shareholders | 4.3 | 2.4 | 75% | ||
| EPS | 0.25 | 0.16 | 56% |
*Notes: pp represents percentage points
Fiscal Year 2021 Financial Highlights
- Revenue was $25.5 million, an increase of 63% from $15.7 million in fiscal year 2020.
- Gross profit was $7.2 million, an increase of 59% from $4.5 million in fiscal year 2020.
- Gross margin was 28% compared with 29% in fiscal year 2020.
- Net income attributable to the Company’s shareholders was $4.3 million, an increase of 75% from $2.4 million in fiscal year 2020.
- Basic and diluted earnings per share were $0.25 compared with $0.16 in fiscal year 2020.
Fiscal Year 2021 Operational Highlights
- The Company hosted 35 dance competition events, 29 music festivals and promotional parties, and 4 online hip-hop programs during fiscal year 2021.
- The Company executed 60 events during fiscal year 2021.
- The Company’s hip-hop events attracted an aggregate of 159,200 attendance and online hip-hop programs generated over 314 million views during fiscal year 2021.
Fiscal Year 2021 Financial Results
Revenue
Revenue increased by $9.8 million, or 63%, to $25.5 million in fiscal year 2021, from $15.7 million in fiscal year 2020.
Revenue from event hosting increased by $7.4 million, or 96%, to $15.0 million in fiscal year 2021, from $7.6 million in fiscal year 2020. The increase was primarily due to the increased number of the Company’s live events (dance competitions, musical festivals, and promotional parties) as well as increased average sponsorship fees, and additional revenue from its new online hip-hop business, which attracted more sponsors to promote their brands in the online hip-hop videos.
Revenue from the event planning and execution increased by $3.7 million, or 67%, to $9.2 million in fiscal year 2021, from $5.5 million in fiscal year 2020. The increase was primarily due to the increase in the number and size of the events the Company undertook.
Revenue from the brand promotion decreased by $1.4 million, or 67%, to $0.8 million in fiscal year 2021, from $2.2 million in fiscal year 2020. The decrease was mainly due to the sluggish demand for advertising or marketing activities.
Revenue from other services increased by $0.3 million, or 87%, to $0.6 million in fiscal year 2021, from $0.3 million in fiscal year 2020.
Cost of Revenue
Cost of revenue increased by $7.1 million, or 64%, to $18.3 million in fiscal year 2021, from $11.2 million in fiscal year 2020. The increase was proportionally in line with the increase in revenue.
Gross Profit and Gross Margin
Gross profit increased by $2.7 million, or 59%, to $7.2 million in fiscal year 2021, from $4.5 million in fiscal year 2020. Gross margin slightly decreased by 1 percentage point to 28% in fiscal year 20201 from 29% in fiscal year 2020, primarily due to the decrease in brand promotion business, which has a higher gross margin.
Operating Expenses
Operating expenses slightly increased by $25,051, or 2%, to $1,392,137 in fiscal year 2021, from $1,367,086 in fiscal year 2020.
Selling and marketing expenses increased by $23,255, or 21%, to $133,387 in fiscal year 2021, from $110,132 in fiscal year 2020. The increase was primarily due to increased advertising expenses in the amount of $20,880, expended in order to promote the Company’s business online.
General and administrative expenses increased by $1,796 to $1,258,750 in fiscal year 2021, from $1,256,954 in fiscal year 2020. The increase was primarily due to slight increases in various items, including employees’ salaries and business entertainment expenses.
Income Tax Expenses
Income tax expenses were $1.4 million and $0.5 million in fiscal year 2021 and 2020, respectively. The increase mainly resulted from the increased taxable income for fiscal year 2021.
Net Income
Net income increased by 63% to $4.3 million in fiscal year 2021, from $2.6 million in fiscal year 2020. Net income attributable to the Company’s shareholders increased by 75% to $4.3 million in fiscal year 2021, from $2.4 million in fiscal year 2020.
Basic and Diluted Earnings per Share
Basic and diluted earnings per share were $0.25 in fiscal year 2021, compared with basic and diluted earnings per share of $0.16 in fiscal year 2020.
Cash Flow
Net cash used in operating activities was $4.0 million in fiscal year 2021, compared with $2.6 million in fiscal year 2020. Net cash provided by investing activities was $nil in fiscal year 2021, compared to $3,261 in fiscal year 2020. Net cash provided by financing activities was $4.0 million in fiscal year 2021, compared with $3.3 million in fiscal year 2020.
Balance Sheet
As of June 30, 2021, the Company had cash of $1.3 million, compared with $1.4 million as of June 30, 2020.