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CNinsure Reports First Quarter 2013 Unaudited Financial Results

Stocks in this article: CISG

About Non-GAAP Financial Measures

In addition to the Company's consolidated financial results under GAAP, the Company also provides non-GAAP financial measures, which are adjusted to exclude share-based compensation expenses. The Company believes that both management and investors benefit from referring to these non-GAAP financial measures in assessing the Company's performance and when planning and forecasting future periods. One limitation of using these non-GAAP financial measures is that these non-GAAP measures exclude the items that were significant in the first quarter of 2013 and the corresponding period of 2012. Another is that items such as share-based compensation expenses have been, and will continue to be, a significant recurring factor in our business.

In light of the limitations, the presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. We encourage investors and other interested persons to review our financial information in its entirety and not rely on a single financial measure. For more information on these non-GAAP financial measures, please see the tables captioned "Reconciliations of GAAP Financial Measures to Non-GAAP Financial Measures" set forth at the end of this release.

CNINSURE INC.
Unaudited Condensed Consolidated Balance Sheets
(In thousands)
       
  As of December 31, As of March 31, As of March 31,
  2012 2013 2013
  RMB RMB US$
ASSETS:      
Current assets:      
Cash and cash equivalents  2,525,618 2,458,334 395,816
Restricted cash  10,871 11,036 1,777
Short term investments  600 95,600 15,393
Accounts receivable, net  196,244 221,315 35,634
Insurance premium receivables  10 461 74
Other receivables  86,565 72,784 11,719
Deferred tax assets  4,942 4,997 805
Amounts due from related parties  151,785 111,714 17,987
Other current assets  17,265 20,087 3,234
Total current assets 2,993,900 2,996,328 482,439
       
Non-current assets:      
Property, plant, and equipment, net  94,921 87,470 14,084
Goodwill and intangible assets, net  121,333 117,917 18,986
Deferred tax assets  3,967 5,963 960
Investment in affiliates  168,620 173,954 28,008
Other non-current assets  18,048 16,648 2,680
Total non-current assets 406,889 401,952 64,718
Total assets 3,400,789 3,398,280 547,157
       
CNINSURE INC. 
Unaudited Condensed Consolidated Balance Sheets-(Continued)
(In thousands)
       
  As of December 31, As of March 31, As of March 31,
  2012 2013 2013
  RMB RMB US$
LIABILITIES AND EQUITY:      
Current liabilities:      
Accounts payable (including accounts payable of the consolidated variable interest entities ("VIEs") without recourse to CNinsure Inc. of RMB30,689 and RMB21,460 (US$3,455) as of December 31, 2012 and March 31, 2013, respectively)  98,124 81,759 13,164
Insurance premium payables (including insurance premium payables of the consolidated VIEs without recourse to CNinsure Inc. of RMB202 and RMB31 (US$5) as of December 31, 2012 and March 31, 2013, respectively)  2,941 3,107 500
Other payables and accrued expenses (including other payables and accrued expense of the consolidated VIEs without recourse to CNinsure Inc. of RMB35,000 and RMB40,452 (US$6,513) as of December 31, 2012 and March 31, 2013, respectively)  116,124 101,400 16,327
Accrued payroll (including accrued payroll of the consolidated VIEs without recourse to CNinsure Inc. of RMB4,382 and RMB3,588 (US$578) as of December 31, 2012 and March 31, 2013, respectively)  42,317 35,166 5,662
Income tax payable (including income tax payable of the consolidated of VIEs without recourse to CNinsure Inc. of RMB2,037 and RMB2,136 (US$344) as of December 31, 2012 and March 31, 2013, respectively)  56,003 54,132 8,716
Amounts due to related parties (including amounts due to related parties of the consolidated of VIEs without recourse to CNinsure Inc. of RMB3,030 and RMB3,030 (US$488) as of December 31, 2012 and March 31, 2013, respectively)  3,030 3,030 488
Total current liabilities 318,539 278,594 44,857
       
CNINSURE INC. 
Unaudited Condensed Consolidated Balance Sheets-(Continued)
(In thousands)
       
  As of December 31, As of March 31, As of March 31,
  2012 2013 2013
  RMB RMB US$
Non-current liabilities:      
Other tax liabilities  47,589 48,924 7,877
Deferred tax liabilities  26,754 26,018 4,189
Total non-current liabilities 74,343 74,942 12,066
Total liabilities 392,882 353,536 56,923
       
Ordinary shares  7,624 7,624 1,228
Additional paid-in capital  2,284,906 2,297,686 369,950
Statutory reserves  178,440 178,440 28,731
Retained earnings  527,542 548,570 88,325
Accumulated other comprehensive loss  (104,132) (104,888) (16,888)
Total CNinsure Inc. shareholders' equity 2,894,380 2,927,432 471,346
Noncontrolling interests  113,527 117,312 18,888
Total equity 3,007,907 3,044,744 490,234
Total liabilities and equity 3,400,789 3,398,280 547,157
       
CNINSURE INC
Unaudited Condensed Consolidated Statements of Income and Comprehensive Income
( In thousands, except for shares and per share data)
       
  For The Three Months Ended
  March 31,
  2012 2013 2013
  RMB RMB US$
Net revenues:      
Commissions and fees  337,281 401,255 64,606
Other service fees  61 7 1
Total net revenues 337,342 401,262 64,607
Operating costs and expenses:      
Commissions and fees  (213,478) (297,169) (47,847)
Selling expenses  (18,680) (20,103) (3,237)
General and administrative expenses  (66,522) (82,381) (13,264)
Total operating costs and expenses (298,680) (399,653) (64,348)
Income from operations 38,662 1,609 259
Other income, net:      
Interest income  22,455 21,545 3,469
Others, net  897 109 18
Income before income taxes and income of affiliates 62,014 23,263 3,746
Income tax expense  (13,705) (6,233) (1,004)
Share of income of affiliates  4,525 5,334 859
Net income 52,834 22,364 3,601
Less: Net (loss) gain attributable to the noncontrolling interests  (1,777) 1,336 215
Net income attributable to the Company's shareholders   54,611 21,028 3,386
       
CNINSURE INC.
Unaudited Condensed Consolidated Statements of Income and Comprehensive Income - (Continued)
( In thousands, except for shares and per share data)
       
  For The Three Months Ended
  March 31,
  2012 2013 2013
  RMB RMB US$
Net income per share:      
Basic  0.05 0.02
Diluted 0.05 0.02
       
Net income per ADS:      
Basic 1.09 0.42 0.07
Diluted 1.08 0.42 0.07
       
Shares used in calculating net income per share:      
Basic 1,002,551,217 998,861,526 998,861,526
Diluted 1,008,067,534 1,002,235,490 1,002,235,490
       
Net income (loss) 52,834 22,364 3,601
Other comprehensive income (loss), net of tax:      
Foreign currency translation adjustments 219 (755) (121)
Comprehensive income (loss) 53,053 21,609 3,480
Less: Comprehensive income (loss) attributable to the noncontrolling interests (1,777) 1,336 215
Comprehensive income attributable to the CNinsure Inc's shareholders 54,830 20,273 3,265
       
CNINSURE INC.
Unaudited Condensed Consolidated Statements of Cash Flow
( In thousands)
       
  For The Three Months Ended
  March 31,
  2012 2013 2013
  RMB RMB US$
OPERATING ACTIVITIES      
Net income 52,834 22,364 3,601
Adjustments to reconcile net income to net cash generated from (used in) operating activities:      
Depreciation  6,750 7,936 1,278
Amortization of intangible assets  4,028 3,416 550
Allowance for doubtful receivables  1,016 749 121
Compensation expenses associated with stock option  4,097 12,780 2,058
Share of income of affiliates  (4,525) (5,334) (859)
Changes in operating assets and liabilities  (62,072) (50,311) (8,101)
Net cash generated from (used in) operating activities 2,128 (8,400) (1,352)
       
Cash flows used in investing activities:      
Purchase of property, plant and equipment  (1,723) (5,498) (885)
Proceeds from disposal of property and equipment  187 14 2
Proceeds from disposal of short term investments  13,630
Purchase of short term investments  (95,000) (15,296)
Disposal of subsidiaries, net of cash 47
Decrease (increase) in restricted cash  654 (166) (27)
Purchase of non-current assets  (1,948)
Return of investment in non-current assets 1,000
Refund of contingent consideration  12,500
Decrease in amounts due from related parties  92,691 40,071 6,452
Net cash generated from (used in) investing activities 117,038 (60,579) (9,754)
       
CNINSURE INC.
Unaudited Condensed Consolidated Statements of Cash Flow-(Continued)
( In thousands)
       
  For The Three Months Ended
  March 31,
  2012 2013 2013
  RMB RMB US$
       
Cash flows generated from financing activities:      
Capital injection by noncontrolling interests  6,530 2,450 394
Proceeds on exercise of stock options  48
Net cash generated from financing activities 6,578 2,450 394
       
Net increase (decrease) in cash and cash equivalents 125,744 (66,529) (10,712)
Cash and cash equivalents at beginning of period 2,222,160 2,525,618 406,649
Effect of exchange rate changes on cash and cash equivalents  219 (755) (121)
Cash and cash equivalents at end of period 2,348,123 2,458,334 395,816
       
Interest paid 
Income taxes paid  29,282 9,497 1,529
       
CNINSURE INC.
Reconciliations of GAAP Financial Measures to Non-GAAP Financial Measures
(In RMB in thousands, except shares and per share data)
       
       
  For The Three Months Ended March 31, 2012
  GAAP <1> Non-GAAP
Operating income  38,662 4,097 42,759
Operating margin  11.5% 1.2% 12.7%
Net income attributable to the Company's shareholders  54,611 4, 097 58,708
Net margin  16.2% 1.2% 17.4%
Shares used in calculating basic net income per share  1,002,551,217 1,002,551,217
Basic net income per ADS  1.09 0.08 1.17
       
   
  For The Three Months Ended March 31, 2013
  GAAP <1> Non-GAAP
Operating income  1,609 12,780 14,389
Operating margin  0.4% 3.2% 3.6%
Net income attributable to the Company's shareholders  21,028 12,780 33,808
Net margin  5.2% 3.2% 8.4%
Shares used in calculating basic net income per share  998,861,526 998,861,526
Basic net income per ADS  0.42 0.26 0.68
       
<1> share-based compensation expenses.      
CONTACT: For more information, please contact:
         Oasis Qiu
         Investor Relations Manager
         Tel: +86 (20) 6122-2731
         Email: qiusr@cninsure.net

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