Tom Online Inc. ADS (TOMO, Financial) filed Quarterly Report for the period ended 2010-06-30.
Tom Online Inc. Ads has a market cap of $178.1 million; its shares were traded at around $3.29 with and P/S ratio of 1.1. TOMO is in the portfolios of Jim Simons of Renaissance Technologies LLC.
Cost of revenue increased to $35.2 million for the three months ended June 30, 2010 from $32.6 million for the three months ended June 30, 2009, an increase of $2.6 million, or 8%, primarily due to increased System sales in the current quarter. Overall, our gross profit was 26.2% for the three months ended June 30, 2010 compared to 20.7% for the three months ended June 30, 2009. The increase in gross profit for the quarter was the result of higher system volume and increased service revenue.
Total service and other costs decreased by $0.5 million, or 3%, for the three months ended June 30, 2010 compared to the three months ended June 30, 2009. Although there was a $1.5 million, or 15%, increase in our overall service contract costs during the second quarter of 2010, due to a 32% increase in the number of units under service contract at June 30, 2010 as compared to June 30, 2009, such increase was partially offset by a $2.0 million decline in service infrastructure costs, as labor and overhead costs absorbed increased $0.5 million, employee costs decreased $1.2 million and costs associated with inventory logistics decreased $0.3 million.
Total research and development expenses increased $1.9 million, or 28%, between periods. System research and development expenses increased by $2.2 million between periods primarily due to a $1.0 million decrease in capitalization of internal development costs resulting from the associated development project being completed and released for delivery in February 2010, a $0.5 million increase in consulting costs and a $0.3 million increase in employee costs. The proton therapy research project spending decreased by $0.3 million during the three months ended June 30, 2010, due mainly to a $0.8 million decrease in consultant fees, partially offset by an increase in employee costs.
Selling, general and administrative expenses increased to $11.9 million for the three months ended June 30, 2010 from $11.2 million for the three months ended June 30, 2009, an increase of $0.7 million, or 6%. The increase was primarily due to an increase in employee costs of $0.7 million and higher commissions, as more Systems were ordered and accepted during the three months ended June 30, 2010 compared to the three months ended June 30, 2009. These cost increases were partially offset by a $0.5 million decrease in sales concessions in the current quarter as compared to the second quarter of 2009.
We had other expense of $0.2 million for the three months ended June 30, 2010 and other income of $0.6 million for the three months ended June 30, 2009. The decline of approximately $0.8 million was due to two primary factors. First, interest income decreased $0.3 million as our average investment balances and interest rates were lower during the second quarter of 2010 as compared to the second quarter of 2009. Second, other expense increased $0.5 million in the current quarter compared with the three months ended June 30, 2009 due primarily to the impact of foreign currency exchange rates.
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Tom Online Inc. Ads has a market cap of $178.1 million; its shares were traded at around $3.29 with and P/S ratio of 1.1. TOMO is in the portfolios of Jim Simons of Renaissance Technologies LLC.
Highlight of Business Operations:
For the six months ended June 30, 2010 and 2009, our revenue was $89.7 million and $71.7 million, respectively, an increase of 25%, and our net loss attributable to shareholders was $11.6 million and $20.1 million, respectively, a reduction of 42%. The results of our operations for the six months ended June 30, 2010 improved over the comparable 2009 period despite the continued impact of the global economic downturn, the ongoing credit crisis and enhanced competitive pressure. Although we experienced a net loss in the first six months of 2010, we maintained a working capital balance of $158.7 million, including $145.7 million of cash and short-term investments, as of June 30, 2010. Thus, we believe we will be able to fund ongoing operations and to invest in future product offerings for at least the next 12 months.Cost of revenue increased to $35.2 million for the three months ended June 30, 2010 from $32.6 million for the three months ended June 30, 2009, an increase of $2.6 million, or 8%, primarily due to increased System sales in the current quarter. Overall, our gross profit was 26.2% for the three months ended June 30, 2010 compared to 20.7% for the three months ended June 30, 2009. The increase in gross profit for the quarter was the result of higher system volume and increased service revenue.
Total service and other costs decreased by $0.5 million, or 3%, for the three months ended June 30, 2010 compared to the three months ended June 30, 2009. Although there was a $1.5 million, or 15%, increase in our overall service contract costs during the second quarter of 2010, due to a 32% increase in the number of units under service contract at June 30, 2010 as compared to June 30, 2009, such increase was partially offset by a $2.0 million decline in service infrastructure costs, as labor and overhead costs absorbed increased $0.5 million, employee costs decreased $1.2 million and costs associated with inventory logistics decreased $0.3 million.
Total research and development expenses increased $1.9 million, or 28%, between periods. System research and development expenses increased by $2.2 million between periods primarily due to a $1.0 million decrease in capitalization of internal development costs resulting from the associated development project being completed and released for delivery in February 2010, a $0.5 million increase in consulting costs and a $0.3 million increase in employee costs. The proton therapy research project spending decreased by $0.3 million during the three months ended June 30, 2010, due mainly to a $0.8 million decrease in consultant fees, partially offset by an increase in employee costs.
Selling, general and administrative expenses increased to $11.9 million for the three months ended June 30, 2010 from $11.2 million for the three months ended June 30, 2009, an increase of $0.7 million, or 6%. The increase was primarily due to an increase in employee costs of $0.7 million and higher commissions, as more Systems were ordered and accepted during the three months ended June 30, 2010 compared to the three months ended June 30, 2009. These cost increases were partially offset by a $0.5 million decrease in sales concessions in the current quarter as compared to the second quarter of 2009.
We had other expense of $0.2 million for the three months ended June 30, 2010 and other income of $0.6 million for the three months ended June 30, 2009. The decline of approximately $0.8 million was due to two primary factors. First, interest income decreased $0.3 million as our average investment balances and interest rates were lower during the second quarter of 2010 as compared to the second quarter of 2009. Second, other expense increased $0.5 million in the current quarter compared with the three months ended June 30, 2009 due primarily to the impact of foreign currency exchange rates.
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