VisionChina Media Announces Renewal of Exclusive Contract in City of Wuhan
New contract to lower Company's media costs by 46.7% in Wuhan year over year
March 28, 2014 --
BEIJING, March 28, 2014 /PRNewswire/ -- VisionChina Media Inc. ("VisionChina Media" or the "Company") (Nasdaq: VISN), one of China's largest out-of-home digital television advertising networks on mass transportation systems, today announced the renewal of an exclusive contract to continue operations of the Company's mobile digital television advertising network in Wuhan, the capital city of China's Hubei Province.
The new contract is effective from April 1, 2014 to December 31, 2018 and provides that the Company will continue to operate the digital mobile television advertising on buses in the city of Wuhan as an exclusive operator for international and national advertising placement, which accounts for more than 90% of total advertising revenue in the Wuhan market. The rearrangement will result in a reduction in the company's media costs in Wuhan associated with the agreement of 46.7% year over year, with no decrease in anticipated revenue.
"This contract extension creates a more favorable cost structure for us and is the result of our ongoing media resource optimization initiatives," said Mr. Limin Li, VisionChina Media's chairman and chief executive officer. "Under the new agreement, we will be able to optimize our advertising inventory and enhance our operating leverage while supporting our current revenue growth trajectory. We will continue to pursue our proven cost-control strategy to solidify a more competitive cost structure, while improving gross margin and operating efficiency in the long term."
According to the Wuhan Bureau of Statistics, in 2013 Wuhan ranked ninth in terms of GDP among all cities in China with a total GDP of RMB 900 billion, or approximately US$145 billion. The city has a population of over 10 million residents.
About VisionChina Media Inc.
VisionChina Media Inc. (Nasdaq: VISN) operates an out-of-home advertising network on mass transportation systems, including buses and subways. As of December 31, 2013, VisionChina Media's advertising network included 111,163 digital television displays on mass transportation systems in 19 of China's economically prosperous cities, including Beijing, Guangzhou and Shenzhen, as secured by exclusive agency agreements or joint venture contract. VisionChina Media has the ability to deliver real-time, location-specific broadcasting, including news, stock quotes, weather and traffic reports, and other entertainment programming. For more information, please visit http://www.visionchina.cn.
Safe Harbor Statement
This press release contains forward-looking statements. These statements constitute "forward-looking" statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will", "expects", "anticipates", "future", "intends", "plans", "believes", "estimates" and similar statements. Among other things, the quotations from management in this press release contain forward-looking statements. Such statements involve certain risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Further information regarding these and other risks is included in the Company's filings with the U.S. Securities and Exchange Commission, including its registration statement on Form F-1 and its annual report on Form 20-F. The Company does not undertake any obligation to update any forward-looking statement as a result of new information, future events or otherwise, except as required under applicable law.
For investor and media inquiries, please contact:
Ms. Shuning Yi
Investor Relations Department
VisionChina Media Inc.
Mr. Colin Wang
Investor Relations Director
VisionChina Media Inc.
Tel: +86 135-1001-0107
In the United States:
Mr. Justin Knapp
Ogilvy Financial, U.S.
SOURCE VisionChina Media Inc.
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