Profile of Xinhua Finance

Company background

Xinhua Finance Limited (XFL) was founded in 1999 with the aim of providing financial information about companies in mainland China. XFL's key products are financial ratings, indices and the distribution of financial data. The company maintains 15 offices and close to 2,500 employees. Their headquarters is in Shanghai. XFL recorded revenues of US$258 million in 2007 and is publicly traded on the Mothers Board in Tokyo (Symbol: 9399).

Last year was one of major changes for XFL. The company sold 8 subsidiaries and closed down its financial news bureaux. These asset sales marked XFL's exit from financial news and investor relations. CEO Jae Lie has stated that the company will now focus on its indices, ratings and financial solutions (primarily data distribution) businesses.

Through Xinhua Far East China Ratings service, XFL provides professionals managers at financial institutions with assessments and opinions on Chinese companies and industries in a variety of asset classes including equities and fixed income. The company has also created a range of benchmark and tradable indices covering the equity and bond market in China. XFL partnered with Barclays Capital and the FTSE Group to establish indices.

XFL plans to develop a distribution capability for its proprietary financial information products. The company claims to already have a 30% market share in the commodities terminal business in China.

Xinhua Finance Media Limited (XFML), a media services company, is a NASDAQ-listed subsidiary of XFL. XFML's services include media production and broadcasting, print and advertising. The company employs 1,400 staff primarily in mainland China.

The media production unit creates and broadcasts a wide variety of programs including business, educational, entertainment and animated shows. The advertising unit is essentially an ad agency which produces and places advertising in a variety of media including outdoor billboards, television, online, mobile and in print. The print division publishes a number of financially-focused titles and holds the (often exclusive) advertising rights to these publications. XFML was founded in 2005 and it was listed on the NASDAQ exchange in March of 2007. Revenues for the year ending December 2007 were US$134.8 million. Revenues in the first nine months of 2008 were US$137 million.