ccme beijing sept 092010

8/8/2019 CCME Beijing Sept 092010

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Investor Presentation

September 2010



1

Safe Harbor

This presentation may contain forward-looking statements within the meaning of the Private SecuritiesLitigation Reform Act of 1995 about the Company. Forward-looking statements are statements that are not

historical facts. Such forward-looking statements, based upon the current beliefs and expectations of theCompany's management, are subject to risks and uncertainties, which could cause actual results to differfrom the forward-looking statements. The following factors, among others, could cause actual results tomeaningfully differ from those set forth in the forward-looking statements:

• Continued compliance with government regulations;• Changing legislation or regulatory environments;• Requirements or changes affecting the businesses in which the Company is engaged;• Industry trends;• Labor and personnel relations;• Credit risks affecting the Company's revenue and profitability;• Changes in the media and entertainment industry;• The Company’s ability to effectively manage its growth, including implementing effective controls and

procedures and attracting and retaining key management and personnel;• Changing interpretations of generally accepted accounting principles;•

General economic conditions; and• Other relevant risks detailed in the Company’s filings with the Securities and Exchange Commission.

The information set forth herein should be read in light of such risks. CCME assumes any obligation toupdate the information contained in this presentation.



CCME is the market leader in television advertising on inter-city and airport expressbuses in China. Annual passenger flow is over 1 billion

Founded in 2003, CCME is one of the top ten outdoor media companies and one of thetop one hundred media companies in China

CCME was listed on AMEX in 2009 and transfer its listing status to the NASDAQ GlobalSelected Market in June 2010

$-

$20

$40

$60

$80

$100$120

2006 2007 2008 2009 1H'10

Revenue ($ million)

Net Profit ($ million)

Executive Summary

CAGR = 149%

CAGR = 208%

CAGRInter-city bus Airport

bus135%

70%

121%

Network Growth Financial Performance Growth

(million)

15,260

20,16122,339

1,126

10,053

43691 4

32

3845

55

6810

13 16

2006 2007 2008 2009 Jun-10 Jun-10

# of Buses # of Bus Operators # of Regions



CCME operates an advertising media network targeting the travelling population

Inter-city Buses

• Connecting 1st-, 2nd-,and 3rd-tier cities

• Average journey time

around 2.5 hours

Network

• Average age 30 (majority male)

• Travel for business or tourism

• Mid-to-high income group

Airport Express Buses

• Connecting airport tocities

• Average journey timearound 1 hour

Target Audience

• PMEB group (Professional,Management, Executives,Businessman) is majority

• High education level

• High income and consumptionlevel group

Business Overview



CCME provides three ad types: regular ad, embedded ad, theme ad

Regular Ad• Broadcasting Frequency: 10 minutes

advertisement time slots after every 30 minutesof programming

• Ad slot: 5, 10, 15, 30, 60 seconds• 20.5 minutes sold every monthEmbedded Ad

•Broadcasting Frequency: blended in the 30minutes programming broadcast•Type: channel entitlement, special joint

entitlement, screen switching entitlement, studiobackground entitlement

•Ad slot: 5, 10, 15, 30, 60 seconds•6.7 minutes sold every month

Theme Ad• Broadcasting Frequency: Broadcasted once whenthe bus engine is turned on

• Ad slot: 60 seconds• 5 minutes sold every month

By multiple adformats, we

• Provide multipleproduct selections

• Provide tailor-made

products andservices

• Improve mediareach and adawareness

• Increase revenuewhile ensuring the

30 minutesbroadcasting ofnon-ad program

Ad Format



Our target: to generate 50% sales from direct advertisers by 2013, while maintaining goodrelationship with agencies

Sales Agencies

• Over 30 agencies, 2-4 agencies ineach region (as of June 2010)

• Cooperating for an average of 2.5years

• All agencies are major regionaladvertising companies

• Annual media purchase contract,monthly settlement

Direct Sales Team

• 113 salespeople - stationed in 14sales center (as of June 2010)

• Provides services to agencies,meanwhile actively seeking directadvertisers

• Clients whopurchase regionalmedia ads, such asAier Ophthalmology ,Haier and ChinaTelecom provincialsubsidiaries

• 21 minutes ofadvertising time soldevery month

• Clients who purchasenational media ads,such as Industry Bank,Micoe, Alibaba

• 11.2 minutes ofadvertising time soldevery month

CCME’s sales model is to further grow its agency sales channel, andactively develop its direct sales channel

Sales Model

AgenciesSales Centers

Beijing

Tianjin

Huhehot

Shijiazhuang

Nanjing

Chongqing

Hefei

Changzhi

Fuzhou

Guangzhou

WuhanChengduShanghai

Qingdao

• Serve agents e.g., feedback onbroadcasting monitoring

• Visit each agent 2-3 times per week



Advertiser’s VoicePepsi: China MediaExpress promotes our products to tier 2 cities and towns by its large scale inter-city bus network, which ishighly helpful to our sales expansion.

CMCC: China MediaExpress’ network penetrates large target audience precisely. It fits our products very well.

Lenovo: ChinaMediaExpress’ media cost is much lower than traditional media, which is the main reason that we chose CCME

Selected AdvertisersRank 2009 1H’ 10

Brand Sector Ad minutes Brand Sector Ad minutes

1 CMCC Telecom 40.28China

TelecomTelecom 60

2 Coca cola F&B 36.33 CMCC Telecom 58.5

3 Unit-present F&B 36.08 Coca cola F&B 52.5

4 ChinaTelecom

Telecom 36.08 Unit-present F&B 51.75

5 Pepsi F&B 33.33 Pepsi F&B 49

6 Master Kong F&B 27.42 Eratat Apparel 41

7 Eratat Apparel 20.25 Xiduoduo F&B 39.5

8 Xiduoduo F&B 18.00 Master Kong F&B 35.25

9 GuJingGong F&B 17.83 GuJingGong F&B 29.5

10 RejiamanHealth care

products17.33 Seven wolf Apparel 28.5

Our advertising clients are national brands mainly: food & beverage (F&B),telecom and apparel sectors

Top Ten Advertisers

Advertisers



Large & Growing Customer Base

Communications / Electronics

Finance

7



Food / Beverage

Personal Care


8



Apparel

Automobile


9



Other


10



High media reach and ad awareness

Media reach of inter-city bus TV advertising is 1.28 and 2.18 times higher ascompared to traditional TV intra-city bus TV advertising, respectively

Media reach of airport bus TV advertising is 90%

90% of surveyed passengers indicated that they have watchedadvertisements displayed on airport bus TV

Specific client - China Mobile ads: survey indicates that 82% of passengers havewatched China Mobile’s advertisements on CCME’s airport buses

Low CPM

CME’s CPM of 15 seconds ad timeslot on inter-city buses was $0.5

(~RMB 3.5) in first half 2010, whichapproximates 3% of the CPM for localTV stations

Media Advantages

CME inter-bus TV ad

Intra-city Bus TV Ad

Outdoor Ad

CME airport shuttlebus TV Ad

Building displayAdTraditional TVAd

CPM

Source: CTR research; management estimate



Inter-city Bus Network

# of inter-city buses

# of regions covered

Established national inter-city bus

media network

Inner –Mongolia

Sichuan

Fujian

Guangdong

Jiangsu

Shanghai

ShandongShanxi

Hebei

BeijingTianjin

Zhejiang

Jiangxi

AnhuiHubeiChongqing

20072008

2009

2010

10,05315,260

20,161 22,239

2007 2008 2009 Jun-10



# of airport shuttle buses

# of regions covered

Quickly expanding airport shuttle bus

media network

Airport Shuttle Bus Network

As of June 2010

Beijing

Qingdao

Fuzhou

Guangzhou

Changsha

Expanded in Sept 2010

2 2

4 4 4 4

Jan'10 Feb'10 Mar'10 Apr'10 May'10 Jun'10



Bus Operator Co-operation Model

Long-term relationship

# of buses by years of co-operation # of bus operators by years of co-operation

CCME has established partnerships with bus-operators organically or through acquisitionof operation rights, and are dedicated to build long-term win-win relationship

ComfortableEnvironment

Economic BenefitsCopyrightProgram

Provides stable supplementaryincome to bus operators Provides various popularentertainment programs toattract passenger’s attention

Displays copyrightedprograms and various CCMEproduced programs

602 524

8,010

4,562

2,581

6,721

02,000

4,000

6,0008,000

10,000

5 Years 4 Years 3 Years 2 Years 1 Year <1 Year

10

0

20

5 5

21

05

10152025

5 Years 4 Years 3 Years 2 Years 1 Year <1 Year



Startup with

Vehicle

The video port is directly connectedwith the power switch of electrical doorlock on each bus, and the programmingstarts when the bus engine is turned on.

MemoryPlaying

MandatoryCommercialBreaks

InvalidationRemoteController

USBPasswordProtection

When the bus enters the service and thebus driver turns the engine off, the videowill stop playing. The program andadvertisement will resume as soon as theengine is turned on again to ensurecontinuity.

Each advertising time slot isprogrammed through a passwordprotected electronic chip.

The broadcasting system is anautomated system which does not allowthe driver to manually turn it off or fast-forward when advertisements are shown.

All programs and advertisementsuploaded in the broadcasting system aresafely protected by a unique password.

Technology Advantages



Historical FinancialInformation

&Current Capital Structure

16



CCME Historical Income Statements

($ in million)

Periods ended YE08 YE09 YoY 1H’09 1H’10 YoY

Revenues 63.0 95.9 52% 37.8 98.0 159%

Gross Profit 37.9 63.0 66% 23.5 68.7 192%

Gross Margin 60% 66% 6% 62% 70% 8%

Operating Expenses (2.8) (6.4) 129% (1.9) (6.2) 226%

Operating Income 35.1 56.6 61% 21.6 62.5 189%

EBITDA 37.9 59.8 58% 23.1 64.5 179%

Net Income 26.2 41.7 59% 15.7 46.7 198%

Net Margin 42% 43% 1% 42% 48% 6%



CCME Historical Balance Sheets

($ in million) Fiscal periods YE08 YE09 1H’10

Assets

Cash and Cash Equivalents 29.9 57.2 139.3

Accounts Receivable 6.1 12.6 20.7

Total Current Assets 36.1 70.0 163.4

Total Assets 49.1 83.0 188.7

Liabilities

Current Liabilities 7.8 28.6 27.3

Total Liabilities 14.1 35.3 37.7

Shareholders’ Equity 35.0 47.7 150.9Total Liabilities and Shareholders’ Equity 49.1 83.0 188.7



CCME Key Financials

Net Revenue ($ million) Net Income ($ million)

CCME has exhibited strong revenue growth and profitability

$26.2

$41.7

$15.7

$46.7

$82-$85

$0.0

$20.0

$40.0

$60.0

$80.0

$100.0

2008 2009 1H'09 1H'10 2010 E

$63.0

$95.9

$37.8

$98.0

$0.0

$20.0

$40.0

$60.0

$80.0

$100.0

2008 2009 1H'09 1H'10



CCME has enjoyed high margins

Income Statement Analysis – Profit Margin

Gross Profit & Margin Operating Profit & Margin

$37.9

$63.0

$23.5

$68.7

60%

66%

70%

62%

$0.0

$20.0

$40.0

$60.0

$80.0

2008 2009 1H'09 1H'1050%

60%

70%

80%

90%

Gross Profit ($ million)

Gross Margin (%)

$35.1

$56.6

$21.6

$62.5

56%59%

57%

64%

$0.0

$20.0

$40.0

$60.0

$80.0

2008 2009 1H'09 1H'1050%

60%

70%

80%

90%

Operating Profit ($ million)

Operating Margin (%)



0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2007 2008 2009 1H10

Inter-city Buses

Airport Express Buses

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2007 2008 2009 1H10

Agent Sales

Direct Sales

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2007 2008 2009 1H10

Regular Ad Embedded Ad

Theme Ad

Revenue Breakdown byChannel

Revenue Breakdown byBus Type

Revenue Breakdown byAd Format

Income Statement Analysis – Revenue



10.115.3

20.2 22.3

810

1316

-

5

10

15

20

25

2007 2008 2009 1H'10# of buses ('000 units)# of regions

20.0 19.7 20.0 20.5

5.0 5.0

5.1 6.7

0

5

10

15

20

25

2007 2008 2009 1H'10Regular Ad Embedded Ad

Theme Ad

$13

$19 $20 $22

$2.5 $2.4

$19 $20

0

5

10

15

20

25

2007 2008 2009 1H'10Regular Ad Embedded Ad

Theme Ad

Income Statement Analysis – Revenue

436

4-

100200

300

400

500

1H'10# of buses (units)

# of regions

Revenue Driver 1 –# of Buses (End of Period)

Inter-city Bus Media

Airport Express Bus Media

Revenue Driver 2 –Ad Rate per Minute per Bus ($)

Revenue Driver 3 –Ad Minutes Sold (End of Period)

$341$330

$380

100

200

300

400

1H'10Regular Ad Embedded Ad

Theme Ad

20.5

6.75.00

510

15

20

25

1H'10Regular Ad Embedded Ad

Theme Ad



Operating Cash Flow and Net Income

Operating Cash Flow and Net Income ($ million)

$12.1

$46.3

$7.0

$26.2

$46.7

$27.4

$38.2$41.7

$0.0

$10.0

$20.0

$30.0

$40.0

$50.0

2007 2008 2009 1H10

Operating Cash Flow Net Income



CCME Capital Structure

33.9%

66.1%

Chairman andInsiders

Public Flow

34.3MCommon

Shares

3M Warrants

+3MPreferred

Shares

14MShares*(Earn

out shares2010 and

2011)

54.3MShares

Total Common Shares Outstanding: 34.3M

* Founders may earn up to 7M Shares and 7M Shares if the adjusted net income in 2010 and 2011reached 83.5M and 130.2M, respectively.



Comparison of Financials

(For six months ended June 30, 2010) CCME Focus Media Vision China Air Media

Revenue ($ million) 98.0 283.1 55.2 102.9

EBITDA ($ million) 64.5 60.1 (18.9) (14.3)

Net Income ($ million) 46.7 24.4 (104.8) (11.2)

Gross Margin 70% 56% -3% 8%

Net Income Margin 48% 9% -190% -11%

Basic EPS ($) 1.16 0.17 (1.30) (0.17)

Diluted EPS ($) 1.07 0.16 (1.28) (0.17)

P/E (1H’10) 6.3x n/a n/a n/a

Source: Market Watch



CCME is Well Positioned to TakeAdvantage of

Growth Opportunities

26



Growth Opportunities

27

Growth Opportunities include…..

1. Acknowledgement by the China’s Ministry of Transport creates a competitiveadvantage for CCME

2. Significantly lower CPM than that of other advertising media provide CCMEwith a significant advantage

3. Advertising clients are accelerating their efforts to grow their sales beyond thefirst- and second-tier cities into less developed markets where CCME has astrong presence and no competitors

4. Highly effective media platform and large passenger flow provide confidenceto the advertisers

5. China’s highway system is expanding rapidly

6. China’s GDP and its middle class are growing fast

7. Low advertising spending per capita

8. China’s government is taking significant steps to increase domesticconsumption



The Copyright Project - In 2007, China’s Ministry of Transport granted a document toall the bus operators in all provinces and municipalities in China, appointing CCME asits sole strategic partner for the broadcasting of programming inside buses andadvising bus operators to work with CCME

CCME also entered into a five-year agreement with Transport Television and Audio-Video Center (“TTAVC”), an entity affiliated with China’s Ministry of Transport. Asper the agreement, CCME:

» Is responsible for the installation of hard disk drive players and audio and visual equipment» Has the exclusive rights to display advertisements on the those buses

» Has the right to display its logo on the inter-city express buses within its network

» Will be compensated for RMB40 million if TTAVC grants another license within the five-yearperiod

CCME is the only outdoor media company to be acknowledged by the ChineseGovernment

Copyright Project

28



China’s Highways Continue to Expand

The Xi’an-Ankang Expressway inShanxi province

Zhanxi bridge highway, a soundproof four lane expressway in Beijing

Night view of urban highways andoverpasses in Shanghai

Construction of highways began in 1988

In 2007, China had approximately 53,600 km of highway (compared to only 147 km in 1988)» 8,000 km of which were built in 2007

The express highway system is set to expand to:

» 65,000 km (2010), 85,000 km (2020), 120,000 km (2030), and 175,000 km (2050).

29



Advertising clients are accelerating their efforts to grow their sales beyond the first-

and second-tier cities into less developed markets where CCME has a strong presence

China has low levels of advertising spending per capita and as a percentage of GDPcompared to more developed countries or regions

Number passengers using inter-city express buses will continue to grow

» China’s Ministry of Commerce recently announced a plan to promote the replacement of old

buses, upgrade the existing transit system, and encourage more people to use publictransportation

China’s growing GDP and middle class

» GDP has increased from 16.0 trillion RMB in 2004 to over 35 trillion RMB in 2009, a 17.1% CAGR

» Average annual disposable income per person has increased from 9,422 RMB in 2004 to almost18,000 RMB in 2009, a 13.8% CAGR

Growing GDP and Advertising Spending

30



Zheng Cheng – Founder, Chairman & Chief Executive Officer

» Over ten years of experience in enterprise management including government relations,formulation of growth strategies and management of the business

» Held a number of senior executive positions in various government agencies, state-ownedenterprises and other companies

Jacky Wai Kei Lam– Chief Financial Officer (May 2009(1))

» Extensive experience in public company accounting and in-depth knowledge of U.S. GAAPaccounting standards and SOX. Member of the Hong Kong Institute of CPAs.

» Over eight years of experience at PricewaterhouseCoopers Hong Kong and was most recently asenior manager before joining CCME; previously an accounting supervisor at a multinational

corporation Jian Yu – Chief Operating Officer (January 2007(1))

» Former director and general manager of Quanzhou New Continent Cultural Media Co., Ltd. anddeputy general manager of Fujian Tang Culture Media Co., Ltd.

Jinlong Du – Chief Marketing Officer (January 2006(1))

» Has held several senior positions in the electrical equipment industry including the generalmanager of Fuzhou Baoli Tongfang Electronics Co., Ltd., Fuzhou Wuzhou Mechanical andElectrical Equipment Co., Ltd.

Biaoxing Chen – Chief Technology Officer (December 2003(1))

» Has served in several senior positions in the media industry including marketing manager ofFujian Tang Culture Media Co., Ltd. and project manager of Fujian Enterprise Culture ExchangeCenter

Management Team

(1) Represents the date the individual joined the Company.

31



Contacts

CHINA MEDIAEXPRESS HOLDINGS, INC. Jacky Lam, CFO

[email protected]

INVESTOR RELATIONS:

The Equity Group Inc.Lena Cati

(212) [email protected]

ccme beijing sept 092010

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