TUDO Tudou Holdings Limited ADS (MM)

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington D.C. 20549

 

 

FORM 6-K

 

 

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 UNDER

THE SECURITIES EXCHANGE ACT OF 1934

For the month of May 2012

 

 

Commission File Number: 001-35270

 

 

TUDOU HOLDINGS LIMITED

 

 

Building No. 6, X2 Creative Park, 1238 Xietu Road, Xuhui District

Shanghai 200032, People’s Republic of China

(86-21) 5170-2355

(Address of principal executive offices)

 

 

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Form 20-F   x             Form 40-F   ¨

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):             

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):             

Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes   ¨              No   x

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82- N/A

 

 

 

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

Date: May 21, 2012

 

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EXHIBIT INDEX

 

		Page
Exhibit 99.1 – Press release regarding first quarter financial results of Tudou Holdings Limited			4

 

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Exhibit 99.1

 

Tudou Reports First Quarter 2012 Financial Results

1Q 2012 Net Revenues of RMB140.3 Million, Up 76.7% Year-over-Year

Exceeding Prior Guidance

(May 21, 2012 - Shanghai, China) Tudou Holdings Limited (NASDAQ: TUDO) (“Tudou” or the “Company”), a leading Internet video company in China, today announced its unaudited financial results for the first quarter ended March 31, 2012.

First Quarter 2012 Revenue Highlights

 

•

Net revenues increased to RMB140.3 million (US$22.3 million), up 76.7% year-over-year, exceeding management’s prior guidance of 70% to 75% year-over-year growth.

 

•

Online advertising service revenues increased to RMB114.6 million (US$18.2 million), up 63.3% year-over-year.

 

•

Mobile video services revenues increased to RMB13.6 million (US$2.2 million), up 53.4% year-over-year.

 

•

Other (sub-licensing) revenues increased to RMB12.1 million (US$1.9 million) compared to RMB0.3 million in the corresponding period in 2011.

First Quarter 2012 Financial Results

Revenues: Net revenues for the first quarter of 2012 increased by 76.7% to RMB140.3 million (US$22.3 million) from RMB79.4 million in the corresponding period in 2011. ¹ Online advertising service revenues for the first quarter of 2012 increased by 63.3% to RMB114.6 million (US$18.2 million) from RMB70.2 million in the corresponding period in 2011. Mobile video service revenues for the first quarter of 2012 increased by 53.4% to RMB13.6 million (US$2.2 million) from RMB8.8 million in the corresponding period in 2011. Other (sub-licensing) revenues increased to RMB12.1 million (US$1.9 million) from RMB0.3 million in the corresponding period in 2011.

Cost of Revenues: Cost of revenues increased by 121.8% to RMB179.6 million (US$28.5 million) from RMB81.0 million in the corresponding period in 2011. The increase was primarily attributable to increased Internet bandwidth costs, content costs and mobile video services costs, partially offset by a decrease in share-based compensation expenses of RMB13.3 million. Internet bandwidth costs totaled RMB71.5 million (US$11.4 million), or 51.0% of net revenues, compared to RMB31.2 million, or 39.3% of net revenues, in the corresponding period in 2011. The increase in Internet bandwidth costs was primarily due to increased traffic on the Company’s website and its continued focus on enhancing users’ experience. Content costs totaled RMB90.5 million (US$14.4 million), or 64.5% of net revenues, compared to RMB23.9 million, or 30.2% of net revenues, in the corresponding period in 2011. Content costs consist of amortization of premium licensed content, salaries and benefits for staff and production costs for content produced in-house. The increase in content costs was primarily due to the increase in amortization of premium licensed content and content produced in-house as a result of an increase in the amount of content purchased and produced. Mobile video services costs totaled RMB6.4 million (US$1.0 million), or 4.5% of net revenues, compared to RMB5.4 million, or 6.8% of net revenues, in the corresponding period in 2011. The increase in mobile video services costs was primarily attributable to the increase in mobile video services revenues.

 

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The Company records revenues on a net basis and net revenues are presented net of third party ad agency fees and sales tax as a reduction of revenues. For the first quarter of 2012, third party advertisement agency fees were RMB25.1 million (US$4.0 million) and sales tax was RMB5.6 million (US$0.9 million), compared to third party advertisement agency fees of RMB15.3 million and sales tax of RMB12.0 million in the corresponding period in 2011.

 

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Gross Loss: For the first quarter of 2012, gross loss totaled RMB39.4 million (US$6.2 million), compared to a gross loss of RMB1.6 million in the corresponding period in 2011.

Operating Expenses: Operating expenses for the first quarter of 2012 were RMB93.3 million (US$14.8 million), compared to RMB160.3 million in the corresponding period in 2011. The decrease was primarily due to a decrease in share-based compensation expenses and allowance for doubtful debt, partially offset by an increase in sales and marketing expenses.

Net Loss: Net loss for the first quarter of 2012 decreased to RMB134.5 million (US$21.4 million) from a net loss of RMB336.0 million in the corresponding period in 2011.

Adjusted Net Loss: Adjusted net loss for the first quarter of 2012, which excluded share-based compensation expenses, was RMB124.2 million (US$19.7 million), compared to an adjusted net loss of RMB59.0 million in the corresponding period in 2011, which excluded share-based compensation expenses and fair value changes in warrant liabilities. See “Non-GAAP Financial Measures” below.

Recent Developments

In April 2012, Tudou announced a joint collaboration with China Central Television Sports & Entertainment Ltd. (“CCTV”), China’s state television broadcaster and the exclusive broadcaster for the London 2012 Olympic Games (the “Olympics”) in China. Together, Tudou and CCTV will broadcast 361° London Action (“London Action”), CCTV’s first theme-based program focused on the Olympics. In addition to providing exclusive access to London Action, Tudou will enhance its users’ experience by allowing them to interact, comment and share content with other users.

In March 2012, Youku Inc. (NYSE: YOKU) (“Youku”) and the Company announced that they had signed a definitive agreement for Tudou to combine with Youku in a 100% stock-for-stock transaction. Under the agreement, each Class A ordinary share and each Class B ordinary share of Tudou issued and outstanding immediately prior to the effective time of the merger will be cancelled in exchange for the right to receive 7.177 Class A ordinary shares of Youku, and each American depositary share of Tudou (“Tudou ADSs”), each of which represents four Tudou Class B ordinary shares, will be cancelled in exchange for the right to receive 1.595 American depositary shares of Youku (“Youku ADSs”), each of which represents 18 Youku Class A ordinary shares. The combination will result in Youku and Tudou shareholders and ADS holders owning approximately 71.5% and 28.5% of the combined entity, respectively, immediately upon completion of the transaction. Upon completion, the combined entity will be named Youku Tudou Inc. Youku’s ADSs will continue to be listed on the NYSE under the symbol “YOKU”.

 

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The combination has been approved by both companies’ boards of directors and is subject to customary closing conditions, including approvals by Youku and Tudou shareholders. Shareholders of Youku and Tudou with representatives serving on the companies’ respective boards of directors have committed to vote in favor of the combination. The combination is expected to close in the third quarter of 2012.

Conference Call

Due to the pending merger with Youku, Tudou will not hold a conference call to discuss its financial results.

About Tudou

Tudou Holdings Limited (NASDAQ: TUDO) is a leading Internet video company in China providing premium licensed content, user generated content (“UGC”) and original in-house produced content. Founded in 2005, Tudou was the first UGC video sharing website launched in China. The “Tudou” brand is one of the most recognized Internet brands in China, and the annual Tudou Video Festival has become a signature event in the online video industry. For more information, please visit http://ir.tudou.com .

Investor Relations Contact:

Michael S. Fu

Director, Investor Relations

Tudou Holdings Limited

Tel: (+86) 21-5170-2355

Email: mfu@tudou.com

Jeremy Peruski

ICR, Inc.

Tel: +1 (646) 405-4884

Email: IR@tudou.com

SOURCE: Tudou

 

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Safe Harbor Statement

This press release contains forward-looking statements made under the “safe harbor” provisions of Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements can be identified by terminology such as “may,” “will,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “aims,” “estimates,” “confident,” “likely to” and similar statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: the Company’s ability to execute its business strategies, plans and initiatives; the Company’s future business development, results of operations and financial condition; changes in the Company’s revenues and certain cost or expense items; the Company’s expectations with respect to increased revenue growth and its ability to sustain profitability; the Company’s ability to develop new services; the Company’s ability to attract users and advertisers and enhance its brand recognition; and the ability of the online video and advertising industry in China to grow at rates projected by market data. Any of the foregoing risks may have a material adverse effect on the Company’s business and the market price of its ADSs. Further information regarding these and other risks is included in the Company’s 20-F filed with the Securities and Exchange Commission on March 30, 2012. All information provided in this press release is current as of the date of the press release, and the Company undertakes no duty to update such information, except as required under applicable law.

Non-GAAP Financial Measures

We define adjusted net income (loss), a non-GAAP financial measure, as net income (loss) excluding share-based compensation expenses and fair value changes in warrant liabilities. We review adjusted net income (loss) together with net income (loss) to obtain a better understanding of our operating performance. We also believe it is useful supplemental information for investors and other interested persons to assess our operating performance without the effect of non-cash fair value changes in warrant liabilities, which will not likely be recurring factors in our business in the future, and share-based compensation expenses, which have been and will continue to be a significant recurring factor in our business.

We present this non-GAAP financial measure because this is used by our management to evaluate our operating performance. We believe this non-GAAP financial measure provides useful information to investors and other interested persons because by having access to such information they will have the same data we use to assess our operating performance, and because such information allows them to understand and evaluate our consolidated results of operations in the same manner as our management and to make period-over-period comparisons of our financial results. However, the use of adjusted net income (loss) has material limitations as an analytical tool. One of the limitations of using non-GAAP adjusted net income (loss) is that it does not include all items that impact our net income (loss) for the period. In addition, because adjusted net income (loss) may not be calculated in the same manner by all companies, it may not be comparable to similarly titled measures used by other companies. In light of the foregoing limitations, you should not consider adjusted net income (loss) in isolation from or as an alternative to net income (loss) prepared in accordance with U.S. GAAP. We encourage investors and other interested persons to review our financial information in its entirety and not rely on a single financial measure.

 

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Exchange Rate

This press release contains translations of certain Renminbi amounts into US dollars at specified rates solely for the convenience of readers. Unless otherwise noted, all translations from Renminbi to US dollars for the quarter ended March 31, 2012 were made at a rate of RMB6.2975 to US$1.00, the noon buying rate in effect on March 30, 2012 as set forth in the weekly H.10 statistical release of the U.S. Federal Reserve Board. No representation is made that any Renminbi or U.S. dollar amounts could have been, or could be, converted into U.S. dollars or Renminbi, as the case may be, at such rate.

 

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Tudou Holdings Limited

Consolidated Balance Sheet Information

(Amounts expressed in RMB, unless otherwise stated)

 

		Mar 31, 2011				Dec 31, 2011				Mar 31, 2012				Mar 31, 2012
		(unaudited)				(unaudited)				(unaudited)				(unaudited)
		RMB				RMB				RMB				US$
Assets
Current assets:
Cash and cash equivalents			208,969,448				872,000,453				695,746,338				110,479,768
Restricted cash			65,564,000				96,786,719				96,685,338				15,352,971
Accounts receivable, net			254,135,465				239,804,186				256,602,540				40,746,731
Prepayments and other current assets			25,174,620				17,888,737				15,347,958				2,437,151
Premium content licensed			9,368,362				64,461,085				47,551,257				7,550,815
Content produced			3,497,227				8,214,506				695,922				110,508
Total current assets			566,709,122				1,299,155,686				1,112,629,353				176,677,944
Equipment			46,711,980				88,787,903				93,393,641				14,830,272
Intangible assets			4,282,842				6,183,164				5,973,504				948,552
Other assets			4,318,269				4,211,498				4,175,908				663,106
Other long-term receivables			—				10,000,000				10,000,000				1,587,932
Prepayment for premium content licensed			—				142,750,301				166,091,005				26,374,118
Premium content licensed			49,531,347				141,403,738				200,466,206				31,832,665
Total assets			671,553,560				1,692,492,290				1,592,729,617				252,914,589
Liabilities and shareholders’ equity
Current liabilities:
Accounts payable			77,800,676				126,643,349				163,179,211				25,911,745
Taxes payable			22,450,667				37,640,665				28,491,533				4,524,261
Accrued liabilities and other payables			154,501,083				230,764,509				225,563,977				35,818,019
Short-term loan			61,243,510				83,343,510				83,343,510				13,234,380
Share-based compensation liability			240,769,592				—				—				—
Total current liabilities			556,765,528				478,392,033				500,578,231				79,488,405
Warrant liabilities			324,424,702				—				—				—
Total liabilities			881,190,230				478,392,033				500,578,231				79,488,405
Series A redeemable convertible preferred shares			7,512,241				—				—				—
Series B redeemable convertible preferred shares			55,729,302				—				—				—
Series C redeemable convertible preferred shares			124,571,600				—				—				—
Series D redeemable convertible preferred shares			372,403,520				—				—				—
Series E redeemable convertible preferred shares			361,558,129				—				—				—
Shareholders’ equity
Ordinary shares			9,700				74,608				74,907				11,895
Additional paid-in capital			11,054,330				2,541,869,642				2,554,379,616				405,618,041
Accumulated deficit			(1,142,475,492	)			(1,327,843,993	)			(1,462,303,137	)			(232,203,752	)
Total shareholders’ equity			(1,131,411,462	)			1,214,100,257				1,092,151,386				173,426,184
Total liabilities and shareholders’ equity			671,553,560				1,692,492,290				1,592,729,617				252,914,589

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Tudou Holdings Limited

Consolidated Statement of Operations Information

(Amounts expressed in RMB, unless otherwise stated)

 

		For the Three Months Ended
		Mar 31, 2011				Dec 31, 2011				Mar 31, 2012				Mar 31, 2012
		(unaudited)				(unaudited)				(unaudited)				(unaudited)
		RMB				RMB				RMB				US$
Revenues			91,418,768				180,038,169				145,856,999				23,161,095
Less: Sales taxes			(12,041,797	)			(13,549,101	)			(5,575,694	)			(885,382	)
Net revenues			79,376,971				166,489,068				140,281,305				22,275,713
Cost of revenues			(80,995,830	)			(160,143,362	)			(179,632,865	)			(28,524,472	)
Gross profit / (loss)			(1,618,859	)			6,345,706				(39,351,560	)			(6,248,759	)
Operating expenses:
Sales and marketing expenses			(76,383,930	)			(105,373,197	)			(68,808,006	)			(10,926,242	)
General and administrative expenses			(83,887,554	)			(45,066,299	)			(24,527,517	)			(3,894,802	)
Total operating expenses			(160,271,484	)			(150,439,496	)			(93,335,523	)			(14,821,044	)
Loss from operations			(161,890,343	)			(144,093,790	)			(132,687,083	)			(21,069,803	)
Finance income			76,657				223,034				639,483				101,546
Finance expense			(867,162	)			(1,459,818	)			(1,517,576	)			(240,981	)
Other expense, net			—				(13,363	)			—				—
Foreign exchange loss			(2,914,383	)			(3,513,029	)			(893,968	)			(141,956	)
Fair value change in warrant liabilities			(170,385,091	)			—				—				—
Loss before income taxes			(335,980,322	)			(148,856,966	)			(134,459,144	)			(21,351,194	)
Income taxes			—				—				—				—
Net loss			(335,980,322	)			(148,856,966	)			(134,459,144	)			(21,351,194	)
Accretion and effect of foreign exchange movement on Series A Preferred Shares			(130,985	)			—				—				—
Effect of foreign exchange movement on Series B Preferred Shares			563,549				—				—				—
Effect of foreign exchange movement on Series C Preferred Shares			1,259,700				—				—				—
Effect of foreign exchange movement on Series D Preferred Shares			3,765,840				—				—				—
Accretion and effect of foreign exchange movement on Series E Preferred Shares			(10,156,000	)			—				—				—
Net loss attributable to ordinary shareholders			(340,678,218	)			(148,856,966	)			(134,459,144	)			(21,351,194	)
Loss per ordinary share
- Basic and diluted			(28.39	)			(1.31	)			(1.19	)			(0.19	)
Loss per ADS
- Basic and diluted			(113.56	)			(5.25	)			(4.74	)			(0.75	)
Weighted average number of ordinary shares used in computing loss per share
- Basic and diluted			12,000,000				113,425,562				113,431,544				113,431,544
Share-based compensation was allocated in operating expenses as follows:
Cost of revenues			14,718,004				1,110,057				1,379,365				219,033
Sales and marketing expenses			35,048,658				4,531,878				5,404,764				858,240
General and administrative expenses			56,849,582				2,646,953				3,430,954				544,812

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Tudou Holdings Limited

Adjusted Net Loss — Non-GAAP Reconciliation

(Amounts expressed in RMB, unless otherwise stated)

 

		For the Three Months Ended
		Mar 31, 2011				Dec 31, 2011				Mar 31, 2012				Mar 31, 2012
		(unaudited)				(unaudited)				(unaudited)				(unaudited)
		RMB				RMB				RMB				US$
Net loss			(335,980,322	)			(148,856,966	)			(134,459,144	)			(21,351,194	)
Add back: Share-based compensation expenses			106,616,244				8,288,888				10,215,083				1,622,085
Fair value changes in warrant liabilities			170,385,091				—				—				—
Adjusted net loss			(58,978,987	)			(140,568,079	)			(124,244,061	)			(19,729,109	)

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Tudou Holdings Limited

Consolidated Statement of Cash Flows

(Amounts expressed in RMB, unless otherwise stated)

 

		For the Three Months Ended
		Mar 31, 2011				Dec 31, 2011				Mar 31, 2012				Mar 31, 2012
		(unaudited)				(unaudited)				(unaudited)				(unaudited)
		RMB				RMB				RMB				US$
Cash flows from operating activities:
Net loss			(335,980,322	)			(148,856,966	)			(134,459,144	)			(21,351,194	)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation of equipment			6,133,281				8,724,857				9,637,685				1,530,399
Amortization of intangible assets			7,850				182,619				209,660				33,293
Amortization of other assets			35,590				35,591				35,590				5,651
Provision for doubtful accounts			12,283,075				17,390,053				2,643,383				419,751
Amortization of the premium content licensed			10,015,907				45,833,577				50,863,964				8,076,850
Amortization of the content produced			3,065,273				750,000				12,728,947				2,021,270
Share-based compensation			106,616,244				8,288,888				10,215,083				1,622,085
Fair value changes in warrant liabilities			170,385,091				—				—				—
Foreign exchange loss			2,914,383				3,513,029				893,968				141,956
Changes in operating assets and liabilities:
Accounts receivables			(23,385,191	)			36,729,124				(19,441,737	)			(3,087,215	)
Prepayments and other current assets			5,143,118				(6,003,888	)			4,835,969				767,919
Content produced			—				(4,996,183	)			(5,210,362	)			(827,370	)
Accounts payable			828,310				22,092,776				6,636,811				1,053,880
Tax payable			1,291,995				5,799,140				(9,149,132	)			(1,452,820	)
Other payables and accruals			18,005,320				43,924,185				(5,200,532	)			(825,809	)
Net cash provided by/(used in) operating activities			(22,640,076	)			33,406,802				(74,759,847	)			(11,871,354	)
Cash flows from investing activities:
Purchase of equipment			(3,379,407	)			(22,986,538	)			(12,263,333	)			(1,947,334	)
Purchase of intangible assets			(2,364,278	)			(1,266,785	)			—				—
Advance payment for premium content licensed			—				(61,966,030	)			(23,340,704	)			(3,706,344	)
Cash paid for premium content licensed			(28,570,237	)			(137,227,357	)			(65,097,644	)			(10,337,061	)
Cash received from maturity of short-term investment			5,837,246				—				—				—
Net decrease/(increase) in restricted cash			663,000				(2,347,968	)			101,381				16,099
Net cash used in investing activities			(27,813,676	)			(225,794,678	)			(100,600,300	)			(15,974,640	)
Cash flows from financing activities:
Cash received from short-term loan			—				20,543,510				—				—
Cash paid for the repayment of short-term loan			—				(20,543,510	)			—				—
Cash paid for initial public offering cost			(813,192	)			(6,420,652	)			—				—
Net cash used in financing activities			(813,192	)			(6,420,652	)			—				—
Net decrease in cash and cash equivalents			(51,266,944	)			(198,808,528	)			(175,360,147	)			(27,845,994	)
Cash and cash equivalents at beginning of period			263,150,775				1,074,322,010				872,000,453				138,467,718
Effect of foreign exchange rate change on cash			(2,914,383	)			(3,513,029	)			(893,968	)			(141,956	)
Cash and cash equivalents at end of period			208,969,448				872,000,453				695,746,338				110,479,768
Supplementary Disclosure of Cash Flow Information
Cash paid for interest			821,295				1,492,948				1,519,720				241,321
Supplementary Disclosure of Non-cash Investing and Financial Activities
Unpaid deferred expenses/Payables related to the initial public offering			11,027,546				—				—				—
Payables related to purchase of equipment			11,199,060				11,743,300				13,723,390				2,179,181
Payables related to premium content licensed			17,730,286				26,377,055				54,296,015				8,621,836
Payables related to purchase of PRC advertising license qualification right			300,124				—				—