Financial Transparency a Requisite
"To reassure future investors, SMG needs to improve its financial transparency, or at least disclose part of its accounts. Its revenues have grown from 1.8 billion yuans in 2001 to 7.5 billion yuans ($1.1 billion) in 2009. And for the first time, the audiovisual group disclosed a profit of $100 million for 2009. And this 10% profit margin can only increase with the exponential growth of the advertising market and the Chinese economy as a whole. Over the same period, the group’s revenues distribution changed significantly: in 2001, 93 % of total revenues came from advertising; 82% in 2005, and 75% in 2009. The remainder is being generated by TV shopping, programming sales, and other commercial operations. This successful diversification can only further increase, thus ensuring a more harmonious growth for SMG".
Evolution of SMG’s Finances
"If SMG has to quickly get into battle position and offer new content, media supports and services to advertisers, it is mostly to profit from the exponential growth (16% in 2010) of the Chinese advertising market and the very large share of television in advertising expenses (over 62%). This is also the only way SMG has to attack the strong position of its main competitor, CCTV, which attracts 10 to 15% of all TV advertising investments in China. Restructured, diversified and consolidated by fresh monies from stock market investors, SMG can also start its world takeover".