Acorn International, Inc. (NYSE:ATV)

SHANGHAI, March 2, 2020 /PRNewswire/ -- Acorn International, Inc. (NYSE: ATV) ("Acorn" or the "Company"), announced that at its regularly scheduled meeting in February, 2020, the Company's board of directors voted to indefinitely suspend its quarterly dividend of US$0.0125 per ordinary share, or US$0.25 per ADS, due to current business impact and uncertainties concerning the potential longer-term impact of the 2019 novel coronavirus (COVID-19) outbreak on the Company's e-commerce business.

Discovered in Wuhan, China in December 2019, COVID-19 causes severe respiratory illness in humans. While it has begun to spread throughout the world, the vast majority of coronavirus cases are in mainland China, with over 78,000 diagnosed cases and over 2,700 deaths, based on the latest statistics from the World Health Organization as of the date of this release. Actions by the Chinese government to curtail the spread of the virus include limiting the transportation of people and goods within and outside of China. Many countries around the world have imposed travel bans to China and are quarantining travelers arriving from China.

"The outbreak of the coronavirus could have a material impact on our business in 2020. There has been disruption to our production capacity and our ability to deliver to customers in parts of China. There is also uncertainty about whether our ability to import raw material for our Acorn Fresh business will be affected materially. Finally, while we are adapting to work-from-home and flexible working arrangements, we have historically operated within a traditional office environment in Shanghai," said Mr. Jacob A. Fisch, CEO and President of Acorn International.

"Some of our online businesses appear to be experiencing increased demand, as customers prefer to shop from home. But we are concerned that the combination of supply-side disruption, delivery challenges and potential, long-term waning consumer demand caused by COVID-19, potentially exacerbated by other factors, could negatively impact our business. While we continue to monitor the situation, at this point it is difficult to assess the probable significance or duration of any disruption. As a result, we are taking a number of defensive measures to cut costs and conserve our cash resources, including salary reductions and the indefinite suspension of the quarterly dividend until we have more confidence concerning the current situation."

SHANGHAI, Feb. 18, 2020 /PRNewswire/ -- Acorn International, Inc. (NYSE: ATV) ("Acorn" or the "Company"), today announced that on February 14, 2020, Mr. Robert W. Roche delivered a letter (the "February 2020 Letter") to the special committee of the board of directors of the Company (the "Special Committee") informing the Special Committee that in light of the uncertainties regarding the impact that the 2019 novel coronavirus outbreak will have on the economy, at this time he and the shareholders of the buyer vehicle are not prepared to pursue the acquisition of the Company (the "Acquisition") at a purchase price of $0.975 per ordinary share or $19.50 per American Depositary Share as set out in his preliminary non-binding proposal letter dated November 4, 2019. Mr. Roche also stated in the February 2020 Letter that he and the shareholders of the buyer vehicle remain interested in continuing negotiations with the Special Committee regarding the Acquisition. No additional terms or proposals have been discussed at this time and there can be no assurance that negotiations will continue or that a revised offer will be made, that any agreement related to the Acquisition will be reached, or that the Acquisition or any other similar transaction will be consummated. 

The Special Committee scheduled a meeting to consider next steps in light of the February 2020 Letter. No decisions have been made with respect to the Company's response. 

Third Quarter 2019 Financial Results

• Net revenues increased 49.4% year-over-year in Q3 2019 to US$11.3 million.
• Net income from continuing operations was US$2.0 million in the third quarter of 2019. This compares to net income from continuing operations of US$3.6 million in the third quarter of 2018. Net loss from discontinued operations, which reflects the sale of a majority stake in the Company's HJX electronic learning products business to a third-party investor and operator in 2017 as well as the Company's call center operations which were discontinued in the third quarter of 2019 (Refer to "Discontinued Operations" discussion below), was US$0.8 million in the third quarter of 2019, compared to net income from discontinued operations of US$0.2 million in the third quarter of 2018.

"In the third quarter of 2019, Acorn continued its sales momentum, with revenues up 49.4% while maintaining gross margins over 70%," said Mr. Jacob A. Fisch, CEO and President of Acorn International.

"Our Babaka branded posture correction products posted another solid quarter and sales of Acorn Fresh continued to ramp up as it continued to expand its product portfolio by adding beef to its core seafood offerings.  Acorn Digital Services, our social media and digital services division, executed on both our own and our clients' brand-building efforts in China."

"In keeping with our core focus on direct-to-consumer e-commerce and digital media marketing in China, we recently reached an agreement to sell our oxygen-generating products business, which sold products via an offline network of distributors in China. As we move forward, we will continue to focus on our core business of selling our own and third party branded products through e-commerce to consumers in China," Mr. Fisch concluded.

SHANGHAI, Nov. 12, 2019 /PRNewswire/ -- Acorn International, Inc. (ATV) ("Acorn" or the "Company"), a leading marketing and branding company in China, today announced that on November 8, 2019 the Company's wholly-owned subsidiary, China DRTV, Inc. entered into an equity transfer agreement to sell 100% of the equity interests in its wholly-owned subsidiary, Zhuhai Acorn Electronic Technology Co., Ltd. ("Zhuhai Acorn"), to an unrelated third-party for a purchase price of US$1,450,000 in cash.  

Zhuhai Acorn is engaged in producing and selling Youngleda oxygen-generating products mainly through an offline distribution network in China comprising 21 distributors and reaching approximately 600 retail outlets across China. The transaction is subject to certain specific closing conditions, includes a working capital adjustment and other adjustments, and is expected to close in early 2020 or earlier.

Commenting on the agreement, Jacob Fisch, President and CEO of Acorn said, "After several months of negotiations, we are pleased to enter into this agreement to sell the oxygen-generating products business. As with the closing of our call center operations, we have continued to exit legacy businesses that are not aligned with our core focus on direct-to-consumer e-commerce and digital media marketing in China." 

SHANGHAI, Nov. 5, 2019 /PRNewswire/ -- Acorn International, Inc. (NYSE: ATV) ("Acorn" or the "Company"), a leading marketing and branding company in China, today announced that the board of directors of the Company (the "Board") has received on November 4, 2019 US time a preliminary non-binding proposal letter, dated November 4, 2019 (the "Proposal"), from Mr. Robert W. Roche, Executive Chairman of the Company, to acquire all of the outstanding shares of the Company not already owned by the Buyer Vehicle (as defined below) at US$19.50 per American Depositary Share (the "ADS," each ADS representing twenty ordinary shares) or US$0.975 per ordinary share in cash, subject to certain conditions. According to the Proposal, it is anticipated that the Buyer Vehicle or its shareholders will control approximately 75% of the outstanding shares of ordinary shares of the Company. 

According to the Proposal, Mr. Robert W. Roche will form a transaction vehicle (the "Buyer Vehicle") for the purpose of pursuing the proposed transaction and will finance the proposed transaction with Buyer Vehicle's internal resources, or funds from affiliated entities, possibly supplemented by equity funding and/or debt financing.  According to the Proposal, there is no definite arrangement in place for such equity or debt financing at this time.  

The Board has scheduled a special meeting to consider next steps with respect to the Proposal. No decisions have been made with respect to the Company's response to the proposed transaction. There can be no assurance that any definitive offer will be made, that any agreement will be reached or executed, or that this or any other transaction will be approved or consummated.

First Quarter 2019 Financial Results

• Net revenues increased 68.5% year-over-year in Q1 2019 to US$9.2 million.
• Net income was US$4.8 million in Q1 2019 as compared to a net loss of US$0.2 million in Q1 2018.

"Acorn started 2019 on a positive note, posting revenue growth of 68.5% compared to Q1 2018, as well as improving gross margins and profitability at the operating level.  Income from continuing operations was US$0.5 million in the first quarter of 2019, up from a loss from continuing operations of US$39 thousand in the first quarter of 2018. In keeping with our strategy to liquidate non-core assets to generate free cash flow, the Company sold its prior principal office in Shanghai to a third party in late 2018 and realized a one-time gain of US$3.8 million in the first quarter of 2019. Net income attributable to Acorn was US$4.8 million, up from net loss attributable to Acorn of US$0.2 million in the first quarter of 2018," said Mr. Jacob A. Fisch, Acorn's President and CEO.

"During the quarter, our Babaka brand of posture correction products generated the highest quarterly sales in recent history. This was driven by expansion on third-party e-commerce B2C platforms and the successful promotion of core products through digital media in China. Acorn Fresh, which offers high-quality, fresh food products via e-commerce, also generated strong sales growth."

"Going forward, Acorn will continue to focus on building brands and growing e-commerce. To support this growth, we are also focused on the continued development of Acorn Entertainment and Acorn Streaming. Consistent with our prior disclosure, we currently do not anticipate any meaningful impact on our business associated with the trade tensions between the U.S. and China as virtually all of our revenue is generated within China," Mr. Fisch concluded.

SHANGHAI, May 20, 2019 /PRNewswire/ -- Acorn International, Inc. (ATV) ("Acorn" or the "Company") today announced that on May 14, 2019, its board of directors declared a cash dividend for 2018 of US$0.05 per ordinary share, or approximately US$1.00 per American depositary share ("ADS"), each of which represents twenty ordinary shares. The board also approved a quarterly dividend for the first quarter of 2019 of US$0.0125per ordinary share, or US$0.25 per ADS, and announced a dividend policy calling for a recurring quarterly dividend of US$0.0125 per ordinary share, or US$0.25 per ADS, subject to quarterly review, approval and declaration by the board. This policy does not replace the possibility of special dividends from time to time.

Record holders of the Company's ordinary shares at the close of business US Eastern Time on June 5, 2019 (the "Record Date") will be entitled to receive the cash dividends for 2018 and the first quarter of 2019. The Company expects Citibank N.A., the depositary bank for Acorn's ADS program, to distribute dividends to ADS holders as of the Record Date on or about June 19, 2019. Dividends to be paid to the Company's ADS holders through the ADS Depositary will be subject to the terms of the deposit agreement by and among the Company and the ADS Depositary, and the holders and beneficial owners of ADS issued thereunder, including the fees and expenses payable thereunder.

"This cash dividend policy builds upon Acorn's prior shareholder-friendly practices, including returning cash to shareholders via a special dividend and share repurchase programs, and reflects the board's and management's confidence in our ability to generate excess cash while operating an asset-light business and helping achieve attractive growth," said Mr. Jacob A. Fisch, CEO and President of Acorn. "Armed with a healthy balance sheet, earnings growth and attractive target markets, we will seek to continue this momentum in the future."

Acorn's Executive Chairman, Mr. Robert W. Roche commented, "Our dividend policy underscores the board's confidence in Acorn's business strategy and commitment to rewarding shareholders for their ownership."

SHANGHAI, May 13, 2019 /PRNewswire/ -- Acorn International, Inc. (ATV) ("Acorn" or the "Company") today announced it has signed a preliminary cooperation agreement with Zhejiang Los Culture Development Company, Ltd. ("Los Culture"), under the guidance of the Department of Culture of Zhejiang Provincial Government, to begin to source opportunities for Western brands and talent, in anticipation of Acorn forming a joint venture with Los Culture that will lead the delivery of content for the International Zhejiang Performing Arts, Music and Culture Center in Hangzhou, Zhejiang China.

The International Zhejiang Performing Arts, Music and Culture Center aims to establish the city of Hangzhou, Zhejiang's capital and one of China's most prosperous cities, as China's primary international arts and culture hub. The project will include a world-class stadium to host concerts, music festivals, and other performances along with music schools, hotels, restaurants and retail space.

Once the JV is established, Acorn's responsibility, through its division, Acorn Entertainment, will be to facilitate cooperation with internationally famous brands and celebrities, including music and performing artists, brands and organizations, for the project, including branding or co-branding opportunities for the stadium, hotels and other retail space, as well as potentially supporting facilitation of programming content, such as live and digital performances and other digital and streaming content.

"We are very pleased to be partnering with Acorn International and Acorn Entertainment on this groundbreaking initiative in China. Under the guidance of the Department of Culture of Zhejiang Provincial Government, we plan to invest in and make the International Zhejiang Performing Arts, Music and Culture Center the premier showcase for international arts and culture in China," said Mr. Qiangfeng Ding, the CEO of Los Culture.

Jacob A. Fisch, Acorn's President and CEO noted: "This is an opportunity for Acorn, through Acorn Entertainment, to play a meaningful role in this large-scale development within China, putting us at the center of a project that will form a new cultural bridge between China and the West. The plans are to set this sizeable development in what is known as China's golden triangle due to the wealth in that area, increasing the likelihood that indeed this could become China's arts & culture hub, and at a size and scale that could rival similar models elsewhere in the world. We are proud to be a part of this project ourselves, honored to be chosen by Los Culture and the Department of Culture of Zhejiang Provincial Government, and pleased to offer our partners in the West an opportunity to join us in participating in this exciting opportunity."

Robert Roche, the Executive Chairman of Acorn, added, "It is extremely exciting and rewarding for Acorn to participate in this new era of expanding public and private sector partnerships in China. We look forward to working alongside Los Culture, under the guidance of the Department of Culture of Zhejiang Provincial Government, on this innovative initiative."

SHANGHAI, March 26, 2019 /PRNewswire/ -- Acorn International (Acorn) (ATV) announced today that it has launched its local Chinese influencer facilitator business, called A-KOL (standing for "Acorn Key Opinion Leader", with a key opinion leader being equivalent to a social media "influencer" in other parts of the world). A-KOL is initially established to support other parts of Acorn's broader business, such as Acorn Streaming, which monetizes digital content, and Acorn Products, which houses Acorn's e-commerce business. A-KOL is distinct from Acorn's core social media management business since A-KOL actually facilitates the development of local China influencers to optimize their ability to convert Acorn's content and product sales.

In China, grassroots influencers, known as KOLs, have become a social media and e-commerce phenomenon, and a major part of B2C business activity now in China. Based on research from Frost and Sullivan, China's internet KOL economy, which refers to all activities relating to the monetization of the KOLs' influence and impact on their fans, grew at a CAGR of 181.5% from 2013 to 2017 and is expected to continue expanding at a CAGR of 41.8% from 2017 to 2022. Moreover, China's market for internet KOL facilitators generated revenue of RMB38.8 billion in 2017 and is expected to grow at a CAGR of 38.9% to RMB200.9 billion in 2022. Despite its size, the industry remains nascent, with many KOLs operating independently, or connected to small, unsophisticated KOL facilitation companies.

In line with Acorn International's business model of combining social media management, content creation and sales of its own as well as third-party brands through e-commerce, various parts of Acorn frequently engage KOLs as part of its business growth. However, through A-KOL, Acorn can now develop its own KOLs to support its business.

"Acorn is bringing the lessons and experience from our prior dominance in direct-to-consumer marketing in TV media in China to direct-to-consumer via digital media. In the digital media and social media space, KOLs represent one of the most relevant and new types of media for conversion to product sales, and we believe they will play an important part in our business going forward," said Mr. Jacob A. Fisch, CEO and President of Acorn. "This is a dynamic and emerging space in the evolution of digital media marketing in China, with a number of these companies looking to tap the U.S capital markets, demonstrating the appeal of A-KOL as both a standalone business as well as for unlocking greater value from the other business units at Acorn."

Fourth Quarter 2018 Financial Results

• Total net revenues were US$8.4 million in the fourth quarter of 2018, up 65.7% from US$5.1 million in the fourth quarter of 2017, primarily due to an increase in e-commerce sales of Babaka branded products as well as other products.
• Net income attributable to Acorn was US$1.6 million in the fourth quarter of 2018. This compares to net income attributable to Acorn of US$7.5 million in the fourth quarter of 2017, which was primarily due to the previously mentioned tax benefit realized in 2017.

SHANGHAI, Feb. 19, 2019 /PRNewswire/ -- Acorn Entertainment (AE) announced today that it has signed Trella Urban Forestry Technologies LLC (Trella) to its lineup of brands that it represents in China. AE will provide Trella a full suite of online, multichannel and multimedia promotional services to grow the value of its brand in China. Trella is a U.S. & China-based company focused on providing sustainable forestry solutions to meet China's fast-growing urban forestry needs. Given that part of Trella's marketing focus is on Chinese millennial youth and youth culture, AE has been retained to drive social media marketing awareness of the Trella brand online and through social channels.

"We at Trella are thrilled to be working with Acorn Entertainment to build the Trella brand in China," said Justin Krane, Principal at Trella. "A major part of accomplishing our mission to provide innovative solutions to the environmental challenges raised by China's rapidly growing cities involves raising awareness of the benefits of urban forestry. And with AE, we are confident that Trella can bring its vision for China to fruition."

One of AE's brand pillars is "giving back" since it recognizes that good business focused on the youth generation and youth culture today must involve a social message. Jacob A. Fisch, CEO and President of Acorn International (NYSE: ATV), the parent company of Acorn Entertainment noted: "With AE's recent engagement in the global campaign to reduce single-use plastic, and with AE's acquisition of new client Go FO, a faux fur fashion brand, we recognize that good business is increasingly about 'giving back' and doing the right thing for generations to come."

AE provides a full suite of online and offline, multichannel and multimedia promotional services to individual celebrity talent as well as brand clients, primarily from the U.S., who seek to maximize their brands in China and increase their "Monetization Ratio" (namely the ratio of income generated from social media engagement relative to the size of the social media engagement). AE's goal is to help talent and brands capture yet-untapped value from the Chinese market through a variety of means, including endorsements, pay-to-view content, as well as e-commerce.

"We are delighted to have Trella as a new client and to help it grow the value of its brand in China," said Brittany Li, head of Client Acquisition at Acorn Entertainment. "It's a great business and its focus on sustainable forestry definitely resonates with the youth audience in China."

SHANGHAI, Feb. 11, 2019 /PRNewswire/ -- Acorn Entertainment (AE) announced today it has expanded its client base to include fashion brands following the addition of New York celebrity designer Jay Godfrey and Go FO, a faux fur collaboration between outwear maker Damiani and Playboy, to its roster of brands and celebrity talent looking to expand their presence in China. AE provides a full suite of online and offline, multichannel and multimedia promotional services to individual celebrity talent as well as brand clients, primarily from the U.S., who seek to maximize their brands in China and increase their monetization ratios from social media engagement. AE's goal is to help talent and brands capture yet-untapped value from the Chinese market through a variety of means, including endorsements, pay-to-view content, as well as e-commerce.

"China's rapidly growing middle class embraces Western fashion and we see a lot of opportunity to build brand value for both Jay Godfrey and Go FO in China. Jay Godfrey has already been active in the Chinese market over the years and we can see how his design aesthetic inspired by the chic New York woman, and worn by celebrities like Taylor Swift, Kim Kardashian, and Holland Roden, will appeal to young women in urban areas. We expect Go FO will appeal to this same demographic, where cruelty-free faux fur is increasingly being viewed as a chic alternative fashion," said Brittany Li, head of Client Acquisition at Acorn Entertainment.

Jacob A. Fisch, CEO and President of Acorn International (NYSE: ATV), the parent company of Acorn Entertainment noted, "We continue to build out our Influencer Management Division with the addition of two exciting new fashion clients. We look forward to working with them to increase monetization from social media engagement in China."

Fisch also noted: "with Go FO in particular, as well as with our recent engagement in the global campaign to reduce single-use plastic, we recognize that good business is increasingly about 'giving back' and doing the right thing for generations to come."

Third Quarter 2018 Financial Results

• Net revenues increased 38.1% year-over-year in Q3 2018 to US$8.3 millio
• Income from continuing operations was US$1.5 million in Q3 2018 compared to a loss from continuing operations of US$0.2 million in Q3 2017

Revenue growth of 38.1% and significant operating leverage resulted in profitability at the operating level for the first time in recent history, with Acorn recording income from continuing operations of US$1.5 million, despite US$0.7 million of non-recurring expenses during the quarter.

During the third quarter, profitable growth in certain of the Company's legacy businesses, especially the Babaka brand, remained strong and continued into the fourth quarter as evidenced by the dramatic increase in Singles' Day sales in 2018 from 2017. Sales of Acorn Fresh, an e-commerce business within Acorn that sells high-quality frozen seafood directly to Chinese consumers, have been ramping, driven by, among other things, live streaming content supported by Acorn Streaming and Acorn Entertainment. Acorn is also hopeful that its recently signed cooperation agreement with influential media powerhouse Shanghai Media Group will allow for additional opportunities for its celebrity clientele and live streaming content to reach Chinese audiences. Acorn expects this focus on new media in China, along with further expansion on additional e-commerce B2C platforms to continue to drive e-commerce sales in the future.

The Company will continue to emphasize the e-commerce channel and is focused on leveraging its 20 years of expertise as a leading marketing and branding company in China. The Company continually evaluates new platforms with positive ROI conversion, including China's major e-commerce platforms as well as other niche digital platforms.

Third Quarter 2018 Financial Results

• Net revenues increased 38.1% year-over-year in Q3 2018 to US$8.3 million
• Net income attributable to Acorn was US$3.8 million in the third quarter of 2018 as compared to net income attributable to Acorn of US$2.3 million in the third quarter of 2017.

SHANGHAI, Nov. 20, 2018 /PRNewswire/ -- Acorn International, Inc. (NYSE: ATV) (Acorn or the Company) today announced that its subsidiary, Acorn Media Group, signed a cooperation agreement with influential media powerhouse SMG through one of its key content subsidiaries, DEG, paving the way for Acorn's broad partnership with one of the largest State-owned media conglomerates in China.

Following the establishment of this partnership, Acorn and DEG intend to work together to provide cross-border resources to support Acorn's influencer management business, Acorn Entertainment, which represents celebrity talent and brands in China to help grow and monetize their presence here, as well as Acorn's content business, which monetizes through VOD or live streaming ticket sales, as well as e-commerce and other revenue channels.

Mr. Jacob A. Fisch, Acorn's President and CEO noted, "I'm very excited to announce what I believe to be a truly landmark deal for us. For Acorn, it provides a wide range of new opportunities and media channels to bring both our talent and our content to Chinese audiences, with the support and partnership of a powerful conglomerate like SMG. In China, this kind of partnership brings legitimacy and sets us apart from other foreign competitors; a partnership like this is critical for achieving our goal of bringing together influencers, content and product marketing into a single platform, at scale."  

Among other things, the agreement between DEG and Acorn provides:

1)      DEG will provide the maximum number of media resources available to promote Acorn's celebrity trips to China, including but not limited to (A) ensuring that Acorn's celebrity clients will appear on DEG programs, news, talk shows, variety shows, and reality shows, and (B) arranging media and public relations interviews across applicable DEG internal medial channels;

2)      DEG will provide brand resources for Acorn, and Acorn will endeavor to provide certain relevant celebrities to produce commercial collaboration arrangements and achieve endorsement deals between such celebrities and brands;

3)      Acorn will from time to time endeavor to source singers and other performers for certain live events organized by DEG;

4)      DEG will cooperate with Acorn to facilitate the growth and monetization in China of mutually agreed emerging artists from anywhere in the world, including but not limited to providing proper media resources to promote such artists;

5)      DEG will be one of Acorn's primary short form content distributors and will be responsible for securing the maximum number of media resources available to promote Acorn's content. Simultaneously, DEG will source commercial deals for such artists.

6)      Acorn will actively promote DEG's interactive communication in the culture circles of America and Japan and provide services and support for the overseas activities and expansion of DEG.

Robert Roche, Chairman and owner of Roche Enterprises, Ltd. (RE) and Chairman of Acorn notes: "As Chairman of Roche Enterprises, which has business interests spanning U.S., China, Japan, and elsewhere around the world, I am pleased to see this framework agreement in place. This partnership will provide tremendous opportunities to tap into RE's global network, and help Acorn present its capabilities not only in China, but also in Japan and the U.S. This powerful network sets Acorn apart from competitors operating with only a pure China platform, on one hand, and also allows Acorn to team up with a powerful Chinese conglomerate to support US businesses in China, on the other hand – providing a winning combination."

SHANGHAI, Nov. 12, 2018 /PRNewswire/ -- Acorn International, Inc. (NYSE: ATV) ("Acorn" or the "Company") today announced that its 11.11 Singles Day e-commerce performance for its Babaka brand exceeded Gross Revenue (before taxes and returns) of RMB 8.5 million in the first two hours of shopping and ended the day at about RMB 13.6 million up from RMB 7.8 million for the full day last year. New product category entrant Acorn Fresh, selling high-quality frozen seafood to Chinese consumers, also performed well on its inaugural 11.11 selling day, and other parts of the business also had a strong day of sales. Singles Day, also known as Double Eleven for its date, was first introduced ten years ago as a day to celebrate lonely hearts. Today, Singles Day is the world's largest online shopping day, eclipsing Black Friday and Cyber Monday by a large margin.

Mr. Jacob A. Fisch, Acorn's President and CEO noted, "We are thrilled with the performance of our e-commerce channel this Singles Day. We've been able to deepen our sales channels on platforms such as Tmall and JD.com as well as expand into streaming media and onto new online platforms, while keeping our product mix relevant to the needs of Chinese consumers. We look forward to building on this success as we continue to focus on growing e-commerce sales in the future."

Second Quarter 2018 Financial Results

• Total net revenues were US$6.3 million in the second quarter of 2018, up 39.4% from US$4.5 million in the second quarter of 2017.
• Net income attributable to Acorn was US$23.8 million in the second quarter of 2018 as compared to a net loss attributable to Acorn of US$3.4 million in the second quarter of 2017. Net income for the second quarter of 2018 includes the one-time gain of $27.7 million from the sale of non-core assets.

In the second quarter of 2018, Acorn achieved solid top line growth due to strong sales of its Babaka posture correction products and Youngleda at-home medical devices via its e-commerce channel. The Company recorded another quarter of improving margins and narrowed its loss from continuing operations to US$0.5 million, approaching breakeven. After successfully completing the sale of non-core assets in May, the Company distributed a special one-time dividend in an aggregate amount of US$40.0 million to its shareholders in June. The Company closed the quarter with a cash position of US$19.5 million, as compared to US$21.1 million at December 31, 2017.

Thus far in 2018, Acorn announced the launch of two new business units: Acorn Fresh, which brings the world's best fresh and safe food directly to the Chinese consumer, as well as Acorn Entertainment, which provides digital PR to western celebrities and brands to enhance their brand value in China. The Company continually evaluates new business opportunities.

The Company will continue to emphasize the e-commerce channel and is focused on leveraging its 20 years of expertise as a leading direct marketing, infomercial company in China. The Company continually evaluates new platforms with positive ROI conversion, including China's major e-commerce platforms as well as other niche digital platforms.

SHANGHAI, China, Aug. 16, 2018 /PRNewswire/ -- Acorn Entertainment (AE) announces it has expanded its client base to now cover US sports, film, television, and music celebrity talent as well as brands looking to expand their presence in China. AE provides a full suite of online and offline, multichannel and multimedia promotional services to individual celebrity talent as well as brand clients, primarily from the U.S., who seek to maximize their brands in China and increase their monetization ratios from social media engagement.

"Building upon the success of our recent campaigns for US sports and film celebrities in China, we continue to add new, high-profile clients to our roster," said Brittany Li, head of Client Acquisition at Acorn Entertainment. "Our core goal with each of our clients is to increase the value of their IP in China, and over time increase their 'Monetization Ratio' (namely the ratio of income generated from social media engagement relative to the size of the social media engagement)."

Jacob A. Fisch, CEO and President of Acorn International (ATV), the parent company of Acorn Entertainment stated, "Since launching Acorn Entertainment last year, we have seen strong interest in our brand building services in China from brands and celebrities thanks to our team's successful execution to date. We continue to focus on expanding this business to include additional clients in a diverse range of industries and geographies in the months ahead, while continuing to maintain a primary focus on representing U.S. celebrity and brand clients from the Entertainment space in China."

SHANGHAI, June 20, 2018 /PRNewswire/ -- In response to questions from our shareholders, we are voluntarily electing to issue this press release to assist our shareholders in understanding the significance of the record date, payable date and ex-dividend date that are mandated by the NYSE rules for the special cash dividend distribution for Acorn International, Inc. (ATV) ("Acorn" or the "Company") that was previously declared and announced on May 25, 2018. As previously announced, below are the distribution dates for Acorn's distribution of US$0.75 per ordinary share, or approximately US$14.97 per American depositary share ("ADS").

Declaration - 5/25/2018
Record Date - 6/4/2018
Payable Date - 6/22/2018
Ex-Dividend Date - 6/25/2018

Under Section 703.02(B) of New York Stock Exchange (the "NYSE") Listed Company Manual, when as here a dividend distribution amounts to 25% or more of the stock price, the NYSE applies an ex-dividend date of one business day after the mail date for the distribution. Record shareholders who sell their shares before the ex-dividend date are obligated to pay a due-bill to the buyer, delivering the dividend payable on such shares.

Accordingly, under Acorn's announced schedule, a record shareholder who sells his/her shares on or after June 25, 2018 shall be able to keep the dividends distributed. Record shareholders who sell their shares before June 25, 2018 shall be obligated to deliver the dividends to the buyer.

SHANGHAI, May 25, 2018 /PRNewswire/ -- Acorn International, Inc. (ATV) ("Acorn" or the "Company") today announced that on May 23, 2018, its board of directors declared a special one-time cash dividend of US$0.75 per ordinary share, or approximately US$14.97 per American depositary share ("ADS"), each of which represents twenty ordinary shares. The aggregate amount of the special cash dividend is approximately US$40 million based on 53,437,890 outstanding ordinary shares which is equal to approximately 2,671,895 ADSs.

Record holders of the Company's ordinary shares at the close of business US Eastern Time on June 4, 2018 (the "Record Date") will be entitled to receive the special cash dividend. The Company expects Citibank N.A., the depositary bank for Acorn's ADS program, to distribute dividends to ADS holders as of the Record Date on or about June 22, 2018. Dividends to be paid to the Company's ADS holders through the ADS Depositary will be subject to the terms of the deposit agreement by and among the Company and the ADS Depositary, and the holders and beneficial owners of ADS issued thereunder, including the fees and expenses payable thereunder.

Acorn has continued to focus on the company turnaround and executing its core strategy of profitably growing its legacy brands, such a Babaka, and its other existing business units, on one hand, and, at the same time, incubating new businesses, such as Acorn Fresh and Acorn Entertainment, on the other hand. It has continued to streamline the business by reducing overhead expenses as well as by selling non-core assets. It is focusing on deploying an "asset light" model for its China operations.

"Our shareholders have repeatedly pointed out the opportunity to unlock value on our balance sheet, create liquidity and return cash to shareholders. In response to this and following the recent sale of our wholly-owned Hong Kong subsidiary Bright Rainbow Investments Limited, and underlying non-core assets, in Q1 this year, our board has approved this return of capital to our shareholders," said Mr. Jacob A. Fisch, CEO and President of Acorn. "Looking ahead, our capital management plan will focus on additional ways to create value for our shareholders while pursuing our core strategy of profitably growing our legacy brands and incubating new businesses."

Acorn's Executive Chairman, Mr. Robert W. Roche commented, "This special cash dividend demonstrates our commitment to maximizing shareholder value, and we believe it is an appropriate way to reward our shareholders for their support."

As of March 31, 2018, the Company had US$18.7 million in cash and equivalents. In April 2018, the Company received approximately US$50 million in net proceeds from the sale of its wholly-owned Hong Kong subsidiary Bright Rainbow Investments Limited, which owns Shanghai HJX Digital Technology Co., Ltd, which owns the land use rights to a plot of land in the Qingpu district of Shanghai, along with the warehouse on that land plot.

SHANGHAI, April 30, 2018 /PRNewswire/ -- Acorn International, Inc. (ATV) ("Acorn" or the "Company") consummated a share sale and purchase agreement with Hong Kong Red Star Macalline Universal Home Furnishings Limited ("Red Star") on April 27, 2018, in exchange for cash payment of approximately RMB360 million (US$57 million), subject to a post-closing working capital adjustment. The contract is subject to an approximately 12% purchase price holdback, which will be paid, netting out tax payables, after certain post-closing requirements are completed.

Pursuant to the terms of the share sale and purchase agreement, Red Star acquired 100% of the shares in our wholly-owned Hong Kong subsidiary Bright Rainbow Investments Limited, which owns Shanghai HJX Digital Technology Co., Ltd, which owns the land use rights to a plot of land in the Qingpu district of Shanghai with a total area of 76,799 square meters, along with the warehouse on that land plot.

The Company expects the net cash received from the transaction to be approximately RMB336 million (US$53 million) before taking into account the working capital adjustment. The Company expects to record an after-tax gain on the sale of approximately RMB232 million (US$36 million) related to the transaction. As of December 31, 2017 the carrying value of the property owned by Shanghai HJX Digital Technology Co., Ltd was approximately RMB107 million (US$17 million).

Commenting on the transaction, Mr. Jacob A. Fisch, President and CEO of Acorn, said, "This transaction is an important one for Acorn, as we continue to liquidate non-core assets, improve liquidity and strengthen our financial position. Following this transaction, we believe there is still significant untapped value on our balance sheet and in our brands. As we look to the future, we are seeking new business opportunities to increase our top line, exploring potential transactions to build scale, and considering other methods to maximize value for our shareholders." 

Mr. Robert W. Roche, Executive Chairman of Acorn noted, "This disposition of another non-core asset demonstrates our focus on creating additional liquidity and cash flow, and unlocking value on our balance sheet. Creating this liquidity provides us greater financial flexibility as we work on expanding our core business and pursuing other growth, including potential transformational, opportunities in the future."

Explanatory Note

To implement the sale and purchase transaction, China DRTV, Inc., a company duly organized and validly existing under the laws of the British Virgin Islands ("Seller"), and a wholly-owned subsidiary of Acorn International, Inc. (ATV) ("Acorn" or "Company"), entered into a share sale and purchase agreement (the "Purchase Agreement") with Hong Kong Red Star Macalline Universal Home Furnishings Limited, a company duly organized and validly existing under the laws of Hong Kong ("Buyer"). Pursuant to the Purchase Agreement, Buyer purchased all of the capital stock of one of Seller's wholly-owned subsidiaries, Bright Rainbow Investments Limited, a company duly organized and validly existing under the laws of Hong Kong (the "Target Company"), from the Seller for RMB 360,000,000 (the "Purchase Price") in cash. The Purchase Price is subject to a post-closing adjustment pursuant to which the working capital of the Target Company as of 11:59PM on the calendar day immediately preceding the closing date will be added to and RMB1,000,000 (as compensation for the removal of the high-voltage power line and tower) will be deducted from the Purchase Price. The Target Company owns the entire share capital of Shanghai Hao Ji Xing Digital Technology Co., Ltd., a company duly organized and validly existing under the laws of the PRC ("HJX"). HJX owns the land use rights to the land plot located at No.8 Huawei Road, Qingpu District, Shanghai, the PRC, with a total area of 76,798.8 square meters, and all the buildings, fixtures and related facilities thereon. Company agrees to guarantee the Seller's performance of its obligations set forth in the Purchase Agreement.

Each of Seller and Buyer respectively agrees to indemnify the other party for losses arising from certain breaches of the Purchase Agreement, and for certain other liabilities, subject to specified limitations.

SHANGHAI, April 27, 2018 /PRNewswire/ -- Acorn International, Inc. (NYSE: ATV) ("Acorn" or the "Company") announced that it today consummated the sale of certain real estate to Hong Kong Red Star Macalline Universal Home Furnishings Limited ("Red Star") in exchange for cash payment of approximately RMB360 million (US$57 million), subject to a post-closing working capital adjustment. The contract is subject to an approximately 12% purchase price holdback, which will be paid, netting out tax payables, after certain post-closing requirements are completed.

The Company expects the net cash received from the transaction to be approximately RMB336 million (US$53 million) before taking into account the working capital adjustment. The Company expects to record an after-tax gain on the sale of real estate of approximately RMB232 million (US$36 million) related to the transaction. As of December 31, 2017 the carrying value of the real estate was approximately RMB107 million (US$17 million).

Pursuant to the terms of the sale and purchase agreement, Red Star acquired 100% of the shares in our wholly-owned Hong Kong subsidiary Bright Rainbow Investments Limited, which owns Shanghai HJX Digital Technology Co., Ltd, which in turn owns the land use rights to a plot of land in the Qingpu district of Shanghai with a total area of 76,799 square meters, along with the warehouse on that land plot.

Commenting on the transaction, Mr. Jacob A. Fisch, President and CEO of Acorn, said, "This transaction is an important one for Acorn, as we continue to liquidate non-core assets, improve liquidity and strengthen our financial position. Following this transaction, we believe there is still significant untapped value on our balance sheet and in our brands. As we look to the future, we are seeking new business opportunities to increase our top line, exploring potential transactions to build scale, and considering other methods to maximize value for our shareholders."  

Mr. Robert W. Roche, Executive Chairman of Acorn noted, "This disposition of another non-core asset demonstrates our focus on creating additional liquidity and cash flow, and unlocking value on our balance sheet. Creating this liquidity provides us greater financial flexibility as we work on expanding our core business and pursuing other growth, including potential transformational, opportunities in the future."

Acorn International Inc. Ads (NYSE:ATV) ($18.38; $49.2m market cap), a global hospitality management company announced that it entered into a Strategic Cooperation Framework Agreement with Cachet Hotel Group Limited Cayman L.P. ("Cachet"), which is an international hospitality branding and management company. Cachet is part of the Roche Enterprises Limited group of companies, which is owned by ATV’s Executive Chairman, Mr. Robert Roche. In addition, Mr. Jacob A. Fisch, ATV's CEO is a shareholder and member of the Board of Directors of Cachet.

Pursuant to the agreement, ATV will become Cachet's preferred supplier for sourcing of all amenities, textiles, other hotel goods as well as various furniture, fixtures and equipment for the hotels, restaurants, clubs and other types of properties managed by Cachet, subject to ATV's ability to procure the products satisfying Cachet's requirements on commercially reasonable terms. The agreement also provides a credit facility for Acorn to loan to Cachet up to $10.0 million at an interest rate of 8% per annum for amounts borrowed in USD and 10% for amounts borrowed in RMB, with each drawdown subject to Acorn's consent at its sole and absolute discretion.

"Acorn's relationship with Roche Enterprises Ltd. is a great asset for the firm, providing opportunities to leverage our existing procurement capabilities and expand into new markets such as the hospitality industry through Cachet Hotel Group," said Mr. Jacob A. Fisch, CEO and President of Acorn. "This agreement solidifies our relationship and opens the door for us to expand into several other areas and take advantage of increasing opportunities within the Roche Enterprises Limited network of companies.”

SHANGHAI, Aug. 4, 2017 /PRNewswire/ -- Acorn International, Inc. (NYSE: ATV) ("Acorn" or the "Company") today announced that it entered into a settlement agreement on July 28, 2017 (concluding with the related share buyback on August 3, 2017) (the "Settlement Agreement") relating to (among other things) a claim filed on December 1, 2016 in the Grand Court of the Cayman Islands (the "Cayman Court") against Andrew Y. Yan, Gordon Xiaogang Wang, and Jing Wang, each former directors of the Company (the "Former Directors") over alleged breaches of fiduciary duties, misconduct and/or mismanagement.

Acorn's action against the Former Directors arose out of the previously disclosed dispute between two groups of the Company's shareholders. Among other things, that dispute involved the improper removal of Mr. Robert W. Roche from his role as Executive Chairman of Acorn by certain members of its then-board of directors. In connection with various actions relating to the shareholder dispute, in March 2016 the Cayman Court found in favor of Roche Enterprises Ltd ("REL", formerly Acorn Composite Corporation), a company wholly owned by Mr. Roche. The claim subsequently filed in the Cayman Court by Acorn in December 2016 alleged that in removing Mr Roche as Executive Chairman, and in subsequent conduct on behalf of Acorn, the Former Directors had breached their fiduciary duties to Acorn and were responsible for misconduct in and/or mismanagement of Acorn's business, and were liable to Acorn for the loss and damage caused to it as a consequence of such conduct.

Pursuant to the Settlement Agreement, the Company, REL, the Former Directors and SB Asia Investment Fund II L.P., an exempted limited partnership registered in the Cayman Islands ("SAIF") will, among other things, discontinue and/or withdraw all claims, counterclaims and taxation proceedings in the Cayman Court related to the above mentioned matters. Agreement was also reached for the Company to repurchase all of the ordinary shares of the Company owned by SAIF, representing 27.7% of the total outstanding ordinary shares of the Company, for the purchase price of approximately $4.17 million, the equivalent of $4.05 per ADS. The purchase price represents an approximately 60.5%, 64.8% and 62.8% discount to the closing price of the Company's ADSs based on the 30-day, 60-day and 90-day moving average, respectively. The repurchased shares will be cancelled. After giving effect to the Company's repurchase of the shares held by SAIF, the Company will have 53,626,050 ordinary shares outstanding or the equivalent of 2,681,302 ADSs.

The Company's audit committee reviewed and approved the related party aspects of the Settlement Agreement under the terms of its charter. The Settlement Agreement was subsequently approved by the Company's current board of directors.

Jacob Fisch, President of Acorn said, "In addition to being a good deal for our company, this is a highly symbolic moment for Acorn where, after years of difficulty, we are now able to truly put the troubles of our past behind us and be 100% forward-looking as we grow our business into the future."

Robert Roche, Executive Chairman of Acorn and President, Roche Enterprises agreed, "We are pleased with this outcome and are excited that we can now focus our efforts on enhancing and growing the business."

Fourth Quarter 2016 Financial Results

Total net revenues were $6.0 million in the fourth quarter of 2016, down from $9.1 million in the fourth quarter of 2015.

SHANGHAI, Feb. 14, 2017 /PRNewswire/ -- Acorn International, Inc. (NYSE: ATV) ("Acorn" or the "Company") today announced that the Company has filed a lawsuit with the Grand Court of the Cayman Islands (the "Cayman Court") on December 1, 2016 against certain former directors of the Company, including Andrew Y. Yan and two others (collectively, the "Defendants"), over alleged breaches of fiduciary duties and misconduct and/or mismanagement.

The Company alleges that the Defendants breached their fiduciary duties and engaged in mismanagement of the Company's business, including but not limited to wrongfully removing Mr. Robert W. Roche as the chief executive officer of the Company, exposing the Company to damages for breaches of contractual obligations, refusing to pursue valuable business opportunities and subjecting the Company to unnecessary severance costs resulting from the wrongful termination of certain Company employees. The relief sought by the Company in connection with the lawsuit consists of (i) initial monetary damage claims comprised of (x) US dollar denominated damages of approximately US$26,326,389.76, and (y) Renminbi denominated damages of approximately RMB 120,045,222 (equivalent to US$17,433,989.57utilizing a conversion rate of 0.1452 as of November 30, 2016)) (ii) costs and (iii) such further or other relief as the Cayman Court considers just.

SHANGHAI, Feb. 1, 2017 /PRNewswire/ -- Acorn International, Inc. (ATV) ("Acorn" or the "Company") has announced that it has received the final ruling from Beijing Xicheng People's Court ("the Court") holding in Acorn's favor. The ruling indicates that Taian Deang Trading Co., Ltd must compensate Acorn based on the claim that it had infringed the Company's trademark for its Suyumei BBJ products. This victory is yet another example of Acorn's push to go after intellectual property (IP) pirates in China to support its own brands as well as licensed foreign brands that it brings into China.

Acorn is building a track record of defending its IP rights through legal actions. Acorn believes its capabilities around brand protection represent an important and differentiating competency as it continues to build its profile as a trusted brand for foreign brands that want to enter China. The Company's IP & Brand Protection Unit will continue to identify and pursue illegal counterfeiters that infringe on its IP rights, especially targeting the e-commerce channel where pirated goods are so prevalent in China. This initiative goes hand in hand with Acorn's goal of growing sales of its proprietary-branded products as well as third-party branded products through e-commerce, its other direct sales channels and nationwide distribution network.

"Our newly formed IP & Brand Protection Unit has once again succeeded in enforcing Acorn's IP rights in China. We will continue to aggressively protect our IP and will be vigilant in identifying and pursuing counterfeiters that sell counterfeit goods in violation of our IP rights. This effort has resulted in a positive impact on Acorn's top line as we take back sales and market share from counterfeiters. More importantly, our dedication to protecting IP is helping to build our reputation as a trusted partner for top foreign brands entering China," said Jacob A. Fisch, President of Acorn. 

Third Quarter 2016 Financial Results

• Total net revenues were $7.5 million in the third quarter of 2016, down from $14.0 million in the third quarter of 2015.
• Net loss was $1.8 million in the third quarter of 2016 as compared to a net loss of $9.8 million in the third quarter of 2015.

SHANGHAI, October 21, 2016 /PRNewswire/ -- Acorn International, Inc. (NYSE: ATV) ("Acorn" or the "Company") today announced the appointment of Grant Thornton CPA LLP ("Grant Thornton") as the Company's independent registered public accounting firm for the fiscal year ending December 31, 2016.

Grant Thornton replaces Deloitte Touche Tohmatsu CPA LLP ("DTT"), previously the independent auditor for Acorn. The appointment of Grant Thornton has been approved by the Audit Committee and the Board of Directors of the Company.

The decision to change auditors was not the result of any disagreement between the Company and DTT on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure. The appointment of Grant Thornton will allow the Company to maintain a top quality auditor while achieving its objective of reducing costs. Acorn would like to take this opportunity to express its sincere gratitude to the DTT team for their services rendered to the Company over the past years.

Second Quarter 2016 Financial Results

• Total net revenues were $3.9 million in the second quarter of 2016, down from $8.1 million in the second quarter of 2015.
• Net income was $5.7 million in the second quarter of 2016 as compared to a net loss of $13.2 million in the second quarter of 2015.

In the second quarter of 2016, Acorn's management continued to execute on its plan to reorganize and turn around the business. The year-over-year decline in revenue reflects the ongoing transition of the Company's business model. However, higher gross margin, significant reductions in operating expenses and a $12.1 million gain from the sale of shares of Yimeng Software Technology Co., Ltd ("Yimeng"), a publicly traded company in China, resulted in a net profit of $5.7 million for the quarter and an improved cash position.

In the second half of 2016, Acorn will continue its efforts to increase revenue, maintain its cost structure and generate additional cash flow. Management will focus on growing sales of its proprietary-branded products as well as third-party products and brands through e-commerce, its other direct sales platforms as well as its nationwide distribution network. As part of its ongoing policy to liquidate non-core assets, Acorn plans to sell certain non-core assets with a carrying amount of approximately $17.6 million and may sell additional shares of Yimeng, as appropriate.

First Quarter 2016 Financial Results

• Total net revenues were $7.1 million in the first quarter of 2016, down from $16.3 million in the first quarter of 2015.
• Net income was $7.4 million in the first quarter of 2016 as compared to a net loss of $9.8 million in the first quarter of 2015.

Financial Results  Fourth Quarter

• Total net revenues were $8.9 million in the fourth quarter of 2015, down from $20.6 million in the fourth quarter of 2014.
• Net loss was $6.8 million in the fourth quarter of 2015 as compared to $13.8 million in the fourth quarter of 2014.

Due to the management change and ongoing restructuring of the business, the Company believes comparing the second half of 2015 financial results with the first half of 2015 is more useful to investors than full year comparisons in evaluating the operating performance of the company under its new leadership and management, which was installed in May 2015, and therefore such information is presented in this press release first, in addition to the fourth quarter and full year 2015 financial results.

On May 4, 2015, Acorn's original co-founder, Chairman and majority shareholder, Robert W. Roche, returned as CEO of the Company to focus on restructuring and turning around the business, after his improper removal on August 26, 2014. Under Mr. Roche's stewardship, the Company has reduced operating expenses and reduced cash burn. Net revenues in the second half of 2015 stabilized, gross margin improved and losses from operations narrowed despite severance and other non-recurring expenses associated with the restructuring of approximately $14.2 million. The Company anticipates further reductions in operating expenses and confirms it will complete the sale of certain non-core real estate assets with contract amount of approximately $11.3 million in 2016, as part of the Company's ongoing policy to liquidate non-core assets.

SHANGHAI, Jan. 11, 2016 /PRNewswire/ -- Acorn International, Inc. (NYSE: ATV) ("Acorn" or the "Company"), a marketing and branding company in China engaged in developing, promoting and selling products through complementary direct sales platforms and distribution networks, today announced that its Board of Directors has authorized a share repurchase program under which the Company may repurchase up to US$2 million worth of its American depositary shares ("ADSs") over the next 12 months.

The Company's proposed repurchases may be made from time to time on the open market at prevailing market prices, in privately negotiated transactions, in block trades and/or through other legally permissible means, depending on market conditions and in accordance with applicable rules and regulations. The timing and extent of any purchases will depend upon market conditions, the trading price of its ADSs and other factors, and are subject to the restrictions relating to volume, price and timing under applicable law. The Company's Board of Directors will review the share repurchase program periodically, and may authorize adjustment of its terms and size. The Company plans to fund repurchases from its existing cash balance.

SHANGHAI, Nov. 19, 2015 /PRNewswire/ -- Acorn International, Inc. (NYSE: ATV) ("Acorn" or the "Company"), a marketing and branding company in China engaged in developing, promoting and selling products through extensive direct and distribution networks, today announced that it will change the ratio of its American depositary shares ("ADSs") to ordinary shares, par value $0.01 per share ("Shares") from 1:3 to 1:20 (the "Ratio Change"). The effective date of the Ratio Change is expected to be on November 30, 2015.

Pursuant to the Ratio Change, the record holders of the Company's ADS as of the effective date will be entitled to receive three (3) new ADS, each representing twenty (20) Shares, in exchange for every twenty (20) ADSs surrendered by them (or, stated another way, 0.15 new ADSs for each ADSs surrendered by them).

For Acorn's ADS holders, this ratio change will have the same effect as a three-for-twenty reverse ADS split. No new Shares will be issued in connection with the Ratio Change and Acorn's ADSs will continue to be traded on the New York Stock Exchange (the "NYSE") under the symbol "ATV".

Citibank, N.A. will contact ADS holders and arrange for the exchange of their current ADSs for new ADSs. As a result of this Ratio Change, the ADS price is expected to automatically increase proportionally, although the Company can give no assurance that the post-change ADS price will be equal to or greater than the pre-change ADS price multiplied by the ratio. The effect on the ADS price will take place on November 30, 2015.

The Company believes that the Ratio Change is in the best interests of its shareholders as it will assist the Company in regaining compliance with the minimum average closing price continued listing standard of the NYSE. However, the Company can give no assurance that this goal will be achieved upon the effectiveness of the Ratio Change.

SHANGHAI, June 30, 2015 /PRNewswire/ -- Acorn International, Inc. (NYSE: ATV) ("Acorn" or the "Company") today announced that as of June 1, 2015 it has regained compliance with the minimum share price criteria required by the New York Stock Exchange ("NYSE") for continued listing of the Company's American depositary shares ("ADS") (each representing three of Acorn's ordinary shares).

As previously disclosed, Acorn received a notice from the NYSE on March 19, 2015 that it was not in compliance with the NYSE continued listing standard requiring a listed security to maintain a minimum average closing price of US$1.00 per share over a consecutive 30-trading-day period.

In a recent letter, the NYSE notified Acorn that it had satisfied the NYSE's standard by virtue of the fact that as of June 1, 2015, both the closing price of Acorn's ADSs and the average closing ADS price over the preceding 30 consecutive trading days were in excess of the $1.00 minimum threshold required by the NYSE. As a result of this occurrence, Acorn has regained compliance with the relevant NYSE continued listing criteria within the prescribed time and the ADSs will continue to be traded on the NYSE, subject to Acorn's continued compliance with all applicable NYSE requirements.

SHANGHAI, May 28, 2015 /PRNewswire/ -- Acorn International, Inc. (NYSE: ATV) ("Acorn" or the "Company"), a marketing and branding company in China engaged in developing, promoting and selling products through extensive direct and distribution networks, today announced that on May 27, 2015, it entered into a Transitional Services and Separation Agreement ("TSSA") with Mr. Don Dongjie Yang, Acorn's co-founder and former chairman and chief executive officer.

Under the terms of the TSSA, Mr. Yang, has agreed to provide Acorn various services to facilitate a transition in management and governance of Acorn and its various subsidiaries and consolidated affiliated variable interest entities (or "VIEs"). Among other things, Mr. Yang will procure the transfer of all interests in Acorn's four VIEs to two individuals, Mr. Kuan Song and Ms. Pan Zong, who are employees of Borrelli Walsh (a specialist corporate advisory, recovery, restructuring and forensic accounting firm), to serve as the VIE's replacement nominee shareholders. Mr. Kuan Song and Ms. Pan Zong, who are both PRC citizens, will respectively hold 90% and 10% of the equity interest in each of the VIEs. Pursuant to various contractual arrangements to be entered into with each of the new nominee shareholders concurrently with the transfer of the equity interest in the VIEs, Acorn and its wholly owned subsidiaries will continue to be able to direct the day-to-day operational and financial activities of its VIEs. These VIE arrangements are more fully described in Acorn's 2014 annual report on Form 20-F filed with the U.S. Securities and Exchange Commission on May 13, 2015.

Acorn will also acquire the 6,518,656 Acorn ordinary shares held by Mr. Yang through his wholly-owned company, D.Y. Capital, Inc., for nominal aggregate consideration of $1.00. These shares represent approximately 7.3% of Acorn's total outstanding ordinary shares as of March 31, 2015 and are equivalent to 2,172,885 of the Company's American depository shares ("ADSs") (with one ADS equivalent to three ordinary shares). Promptly following acquisition of the shares, Acorn will cancel the shares reducing its issued and outstanding shares accordingly. Based solely on the closing price of Acorn's ADSs on the New York Stock Exchange on May 27, 2015 (the last trading day before this announcement), the 6,518,656 ordinary shares of the Company (equivalent to 2,172,885 ADSs) to be acquired for $1.00 (in aggregate) and canceled had a value of approximately $3.3 million.

In addition, the TSSA provides for a mutual waiver and release of all claims (if any) that Acorn or Mr. Yang (and their associated entities and persons) may have against one another for any matters arising or occurring prior to May 27, 2015 (the date of the TSSA), as well as restrictions on use of confidential Acorn information, and a one-year non-compete and non-solicit undertakings by Mr. Yang. In consideration for Mr. Yang's years of services and obligations under the TSSA, Acorn has agreed to pay Mr. Yang $750,000 as a severance payment. Half of the payment will be made upon and subject to the perfection of the various filings and approvals necessary to transfer the VIE interests to Mr. Song and Ms. Zong.

The TSSA was exclusively considered and negotiated on behalf of Acorn by a committee of Acorn's board of directors comprised of three independent directors who are unaffiliated with any member of Acorn's current or former management team.

"As a co-founder of our business, Don has been a key figure in Acorn's history and development, and we thank Don for his invaluable years of service and tireless dedication. We wish him the very best." stated Mr. Robert Roche, Acorn's chief executive officer and the chairman of its board of directors.

Third Quarter 2014 Financial Results

• Net revenues were $31.1 million, a decrease of 44.8% from $56.3 million in the third quarter of 2013.
• Basic and diluted loss per ADS was $0.33 compared to basic and diluted loss per ADS of $0.39 in the third quarter of 2013.

Business Outlook:

Acorn's management is currently exploring several strategies to better position its TV direct sales business under the new SAPPRFT regulation. The Company has reduced overall media spending while seeking to enhance media efficiency and identify areas for additional cost savings. After several months of focusing on local television channels, Acorn has determined that satellite channels provide a better return on media spending. As a result, the Company intends to focus more on satellite channels and less on local television channels. In addition, the Company intends to launch new products in several categories in the fourth quarter. Finally, management hopes to increase utilization of its other direct sales platforms, especially its outbound call centers, e-commerce and catalog businesses to help offset the decline in TV direct sales.

The Company is optimistic about the growth prospects for its electronic learning products in the remainder of 2014 and beyond. Management believes that as brand recognition of its electronic learning products continues to grow, it will achieve better results from its growing network of more than 4000 retail distributors. It is also pursuing an O2O platform in partnership with one of China's leading consumer electronics retailers, providing opportunities for additional growth.

Acorn reminds investors that its operating results in each period vary significantly as a result of the mix of products sold in the period and the platforms through which they are sold. Therefore, operating results for interim periods are not necessarily indicative of results that may be expected for any other interim period or for the full year. Consequently, in evaluating the overall performance of Acorn's multiple sales platforms in any period, management also considers metrics such as operating margin and gross profit return on advertising expenses.

Second Quarter 2014 Financial Results

• Net revenues were $14.8 million, a decrease of 63.9% from $40.9 million in the second quarter of 2013.
• Basic and diluted loss per American Depositary Share ("ADS", one ADS represents three ordinary shares) was $0.48, as compared to basic and diluted loss per ADS of $0.32 in the second quarter of 2013.

In the second quarter of 2014, the Company's TV direct sales business continued to be impacted by the recent regulation imposed by China's State Administration of Press, Publication, Radio, Films and Television (the "SAPPRFT") limiting the length and frequency of infomercials aired on satellite television channels in China. Sales in Acorn's Yierjian fitness product line, which has entered into the later stages of its product life cycle, slowed and mobile phones sales continued to decline. Sales of electronic learning products, which are sold primarily through the Company's nationwide distribution network, also declined as the Company offered discounts to distributors on some of its older models to clear inventory in advance of the peak season and sales performance was lower than expected.

During the quarter, Acorn expanded its nationwide distribution network by nearly 10% to approximately 3,800 outlets, adding some of China's largest consumer electronics retailers and supermarket chains. Acorn plans to offer several new electronic learning products during the third quarter which the Company expects to drive sales growth in the second half of the year.

Management continues its efforts to position the TV direct sales business under the new regulatory environment. In addition to its focus on increasing the efficiency of a more limited media budget, Acorn has reduced headcount and reorganized its call centers to place a greater emphasis on outbound telemarketing. The Company is currently refining its product placement marketing strategy and plans to launch new products in several categories, such as kitchen and household products and elder care products. Acorn also plans to utilize its other direct sales platforms, especially the e-commerce and catalog businesses, to help offset the decline in the TV direct sales.

Business Outlook:

Acorn's management has been closely monitoring the impact of the new SAPPRFT regulation and is seeking to better position the Company's TV direct sales business under the new regulatory environment. The Company has reduced overall media spending while seeking to enhance media efficiency and placing greater emphasis on local television channels. Based on initial testing, Acorn has identified the more cost-efficient time slots for its new product placement marketing strategy, which pairs a 20-40 minute television program featuring its products with a three-minute infomercial.

Acorn is currently testing different formats and plans to introduce new products in several categories, such as kitchen and household products and elder care products. The Company is optimistic about the growth prospects for electronic learning products in the second half of 2014, supported by new product launches and the ongoing expansion of its nationwide distribution network. Management expects recent enhancements to its outbound call center operations along with further development of its e-commerce and catalog platforms to help offset the impact of the SAPPRFT restrictions on its TV direct sales business. Meanwhile, the Company will identify areas for additional cost savings.

Acorn reminds investors that its operating results in each period vary significantly as a result of the mix of products sold in the period and the platforms through which they are sold. Therefore, operating results for interim periods are not necessarily indicative of results that may be expected for any other interim period or for the full year. Consequently, in evaluating the overall performance of Acorn's multiple sales platforms in any period, management also considers metrics such as operating margin and gross profit return on advertising expenses.

First Quarter of 2014 Financial Results

• Net revenues were $28.3 million, a decrease of 45.3% from $51.8 million in the first quarter of 2013.
• Basic and diluted loss per American Depositary Share ("ADS", one ADS represents three ordinary shares) was $0.30, as compared to basic and diluted loss per ADS of $0.23 in the first quarter of 2013.

The first quarter of 2014 was marked by a sharp decline in revenue from the Company's direct TV and other direct sales platforms due to the new regulation limiting the length and frequency of infomercials aired on satellite television channels in China. The Company also experienced slower sales in its Yierjian fitness product line, which has entered into the later stages of its product life cycle, and a continued decrease in mobile phones sales. On the other hand, the Company's electronic learning products, which are sold primarily through the Company's nationwide distribution network, posted a fourth consecutive quarter of year-over-year sales growth and accounted for 42.7% of total gross revenues in the first quarter of 2014.

Management continues to draw upon its expertise in media and branding to better position its TV direct sales business under the new regulatory environment. Acorn is testing a new product placement marketing strategy on local television channels. The Company also plans to launch new products in several categories, including kitchen and household products and fashion products. Acorn will continue to enhance its nationwide distribution network for electronic learning products and utilize its other direct sales platforms, especially the e-commerce and catalog businesses, to generate sales and attract new customers. The Company will focus on increasing the efficiency of a more limited media budget while carefully managing operating expenses.

Business Outlook:

Acorn's management has been closely monitoring the impact of the new SAPPRFT regulation and is seeking to better position the Company's TV direct sales business under the new regulatory environment. The Company plans to reduce overall media spending while enhancing media efficiency and placing greater emphasis on local television channels. Acorn is testing a new product placement marketing strategy which pairs a 20-40 minute television program featuring its products with a three-minute infomercial.

Acorn will continue to test new products in several categories, such as kitchen and household products and fashion products. Management will also devote considerable resources to the Company's e-commerce and catalog platforms to generate sales and attract new customers while carefully managing operating expenses.

Acorn reminds investors that its operating results in each period vary significantly as a result of the mix of products sold in the period and the platforms through which they are sold. Therefore, operating results for interim periods are not necessarily indicative of results that may be expected for any other interim period or for the full year. Consequently, in evaluating the overall performance of Acorn's multiple sales platforms in any period, management also considers metrics such as operating margin and gross profit return on advertising expenses.

Fourth Quarter 2013 Financial Results

• Net revenues were $35.7 million, a decrease of 39.5% from $59.1 million in the fourth quarter of 2012
• Basic and diluted loss per American Depositary Share ("ADS", one ADS represents three ordinary shares) was $0.51, as compared to basic and diluted loss per ADS of $0.30 in the fourth quarter of 2012.

The Company closed the year with revenue below expectations, primarily due to slower sales of its Yierjian product line, which has entered the later stages of the product life cycle, and mobile phones. Media efficiency of TV direct sales was adversely impacted by higher media costs. Meanwhile, the Company enjoyed a healthy increase in gross margin due to its kitchen and household product line, which accounted for 29.2% of gross revenue for the quarter. Electronic learning products posted the third consecutive quarter of year-over-year sales growth, mainly due to growing market acceptance of newer models incorporating mobile Internet interactive features, such as online tutoring services.

In 2014, Acorn will test new products in several categories and expand into fashion products including shoes, apparel and jewelry. The Company is drawing upon its expertise in media and branding to position its TV direct sales platform for success within the new regulatory environment that limits the length and frequency of infomercials aired on satellite television channels in China. Acorn will continue to leverage its other direct sales platforms, especially the e-commerce and catalog businesses, along with the nationwide distribution network of electronic learning products, to drive sales volume in the year ahead.

Business Outlook:

On January 1, 2014, new regulations issued by China's State Administration of Press, Publication, Radio, Films and Television (the "SAPPRFT") became effective which impose limitations on the length and frequency of infomercials aired on satellite television channels in China. The immediate impact has been a significant reduction in airtime for infomercials promoting Acorn's products. Company management is closely monitoring the impact of these new regulations and seeking to better position the Company's TV direct sales business in light of the new regulatory environment. Given the uncertainty surrounding the SAPPRFT regulations on its business, the Company is not in a position to provide financial guidance for 2014 at this time.

In response to the new regulations, the Company is refining its infomercials to make them more impactful with a new, shorter format and adjusting the product mix accordingly. It will continue to test new products and will expand into fashion products. The management strives to increase the effectiveness of outbound telemarketing efforts by leveraging its extensive customer database. Acorn also plans to devote resources to increase e-commerce and catalog sales and to expand its existing distribution network of electronic learning products to help drive sales volume and attract new customers.

Acorn reminds investors that its operating results in each period vary significantly as a result of the mix of products sold in the period and the platforms through which they are sold. Therefore, operating results for interim periods are not necessarily indicative of results that may be expected for any other interim period or for the full year. Consequently, in evaluating the overall performance of Acorn's multiple sales platforms in any period, management also considers metrics such as operating margin and gross profit return on advertising expenses.

Third Quarter 2013 Financial Results

• Net revenues were $56.3 million, a decrease of 18.7% from $69.2 million in the third quarter of 2012.
• Basic and diluted loss per American Depositary Share ("ADS", one ADS represents three ordinary shares) was $0.39, as compared to basic and diluted loss per ADS of $0.04 in the third quarter of 2012.

"Net revenues declined in the third quarter primarily due to lower sales of fitness products and mobile phones compared to the same period last year. Our Yierjian line of fitness products is entering the later stages of the product life cycle and is experiencing a significant decline in revenue, while our mobile phones sales decreased due to intense competition and a limited selection of mobile phone models available for TV infomercials. The third quarter is typically a seasonally stronger quarter for electronic learning product sales, and we made a large investment in television advertising to support our new models incorporating mobile interactive internet features. Although electronic learning products were our best selling product category this quarter, growing 15.1% year-over-year, the product line performed below our expectations. On a positive note, we are pleased with the performance of our kitchen and household products line, which accounted for 25.7% of gross revenues in the quarter and made a favorable contribution to gross margin. As a result of lower revenue and higher advertising and selling expenses associated with electronic learning products and our distribution channel, we reported a loss for the quarter. However, we plan on testing new products in several categories to increase revenue in coming quarters. Meanwhile, we are confident in our ability to scale up sales of electronic learning products in the future," said Mr. Don Yang, CEO of Acorn.

Business Outlook:

Based on current trends, the company is maintaining its previously announced revenue guidance for the full year 2013 of between$190 million and $210 million and anticipates a net loss at or somewhat larger than its prior full year 2013 net loss guidance of $30 million.

Going forward, Acorn plans to introduce new products in several categories. The Company will make further enhancements to its electronic learning products in an effort to scale up sales and enhance their overall market recognition. The Company continues to focus on improving the efficiency of its call center operations and increasing the effectiveness of its outbound telemarketing efforts by leveraging its customer database to increase sale

SHANGHAI, September 11, 2013 /PRNewswire/ -- Acorn International, Inc. (NYSE: ATV) ("Acorn"), a media and branding company in China engaged in developing, promoting and selling products through extensive direct and distribution networks, today announces that Shanghai Acorn Network Technology Development Co., Ltd., an affiliated entity of Acorn, has entered into an Insurance Business Cooperation Agreement with Taiping Life Insurance Co., Ltd. ("Taiping Life"), a subsidiary of China Taiping Insurance Group Company.

Pursuant to the agreement in effect as of August 6, 2013, Acorn and Taiping Life will jointly promote and sell short-term accident insurances to Acorn's customers within designated provinces and municipalities in China. With this, Acorn has expanded its insurance business coverage to most Chinese provinces, and all direct-controlled municipalities.

"We are delighted to work with Taiping Life, one of the leading insurance companies in China, to better serve our customers with diverse insurance products and related services," said Mr. Robert Roche, Chairman of Acorn. "We aim at increasing geographical coverage to attain sustainable business growth with our extensive customer database, as an additional revenue stream for Acorn's insurance sector."

Second Quarter 2013 Results

• Revenues were $40.9 million, a decrease of 11.2% from $46.1 million in the second quarter of 2012.
• Loss per ADS  was $0.32, compared to a loss per ADS of $0.17 in the second quarter of 2012.

"We are disappointed with our second quarter 2013 financial results. However we are confident in our business models, and we are encouraged by revenues growth of our Internet sales through the platforms of China's leading E-commerce companies. To enhance the operational efficiency of our call centers, we are restructuring our call center systems, upgrading our IT infrastructure and recruiting more experienced management," said Mr. Robert Roche, Executive Chairman of Acorn.

Business Outlook

While fitness products revenues are expected to continue to grow, our management expects that related sales growth to slow as our Yierjian products enter the later stages of their product life cycles. In addition, due to lower-than-expected sales of electronic learning products, delays in the launch of and the underperformance of certain new products, and higher labor costs, Acorn is revising its previously announced earnings guidance. Acorn now expects full year 2013 revenues of between $190 million and $210 million and a net loss of between $27 million and $30 million.

Throughout the remainder of 2013, Acorn intends to focus on improving its call centers' operational efficiency. Acorn also will continue its efforts to strengthen its Internet channels, including its proprietary website sales and sales on the platforms of China's leading E-commerce companies, as well as database sales through its other direct sales channels. Additionally, Acorn will continue to strive to scale up sales of its electronic learning products and enhance their overall market recognition. Acorn anticipates additional new product launches throughout the remainder of the year and higher sales from its outbound telephone sales team leveraging Acorn's customer data base. Furthermore, Acorn's management remains focused on controlling costs across the organization to improve profitability.

SHANGHAI, Aug. 28, 2013 /PRNewswire/ -- AVD Digital Media (AVD),a digital innovation hub specializing in interactive video engagement, in partnership with Acorn International, Inc. (NYSE: ATV), a media and branding company engaged in developing, promoting and selling products through direct response and distribution networks, has officially launched its first interactive shoppable video for online consumers. This is the first shoppable eCommerce video of its kind in the China market.

SHANGHAI, August 23, 2013 /PRNewswire/ -- AVD Digital Media (AVD), a digital innovation hub specializing in interactive video engagement, in partnership with Acorn International, Inc. (NYSE: ATV), a media and branding company engaged in developing, promoting and selling products through direct response and distribution networks, has officially launched its first interactive shoppable video for online consumers. This is the first shoppable eCommerce video of its kind in the China market.

AVD TOUCH�, AVD's proprietary interactive video solutions allow Acorn (NYSE: ATV) web shoppers to purchase and receive product information simply by touching any product or object they see on-screen. AVD's revolutionary technology is deployable on any eCommerce site and can also live inside online video portals and website banner ads. "This multi-platform capability enables maximum exposure and immediate shoppability in all the places audiences naturally go to watch content," says AVD's CEO, Andrew Ballen. "This opens up video everywhere as the new and natural way to drive eCommerce sales."

AVD TOUCH� has been shown to dramatically increase click-through-to-buy and final conversion rates while significantly lowering cost per sale when compared to other direct-sell mechanisms.

"Engaging interactively with video content enables our consumers to sit in the driver's seat and take control of their online experience," states Executive Chairman of Acorn International and member of the USTR Advisory Committee for Trade Policy and Negotiations, Robert W. Roche.

Using visual keys in video, AVD TOUCH� marries the world's most advanced technology with man's most powerful desire. Viewers can now purchase and explore anything they see and want, whenever it appears inside TOUCH� video. This leads to natural and dramatic increases in viewer engagement, social sharing and immediate purchase.

First Quarter 2013 Financial Results

• Net revenues were $51.8 million, down 24.0% from $68.1 million for the first quarter of 2012.
• Basic and diluted loss per American Depositary Share ("ADS") was $0.23 compared to basic and diluted loss per ADS of $0.08 for the first quarter of 2012.

"Revenue declined in the first quarter of 2013 primarily due to lower-than-expected sales of electronic learning products, lower sales of mobile phones, and decreased scale of TV advertising. It is taking a longer time than expected to scale up sales of our new electronic learning products. In addition, with higher media prices and a limited selection of products suitable for TV advertising, we selectively reduced our TV airtime purchases to improve our media efficiency and control our expenses. As a result, we recorded decreased revenues and a loss for the quarter. However, we are optimistic about our new electronic learning products as the mobile Internet interactive features have been well accepted by consumers in the initial marketing campaign and we are investing considerable resources and efforts in this product line to ramp up sales. We are also encouraged by the performance of our fitness products which accounted for 28.3% of our total gross revenues for the quarter and led to drive an improvement in gross margin. We are introducing new fitness products to our flagship Yierjian brand and plan to launch new Aoya cosmetics products this summer. Meanwhile, we continue to build Internet sales for our proprietary products on some of China's leading E-commerce websites. We believe all of these initiatives will increase our top line and drive profitability in 2013," said Mr.Don Yang, CEO of Acorn.

"Although our first quarter results are disappointing, we are currently developing comprehensive campaigns to improve utilization of our customer database and generate more revenues. In addition, we have seen some momentum in sales of insurance products through our partnership with Sino-US United MetLife Insurance Co., Ltd., and are using our extensive database and other available resources to grow this new business focus," said Mr. Robert Roche, Executive Chairman of Acorn.

Fiscal Year 2013 Business Outlook:

Based upon the current evaluation of our business and prospects throughout the year, the Company affirms guidance for the full year 2013 for revenues between $290 million and $310 million and net income between $0 million and $2 million.

In 2013, the Company will seek to increase TV media supported sales and improve the effectiveness of its media spending by promoting its most profitable products and working with the most productive TV channel partners. The Company also believes its Internet channels, including its own branded website and the platforms of China's leading E-commerce companies, database sales through its other direct sales channels, and distribution channel will contribute to overall revenue growth. Acorn believes its best-selling product categories will be fitness products and electronic learning products, and plans to launch new products in each category throughout the year. Acorn's management will continue to enhance cost efficiencies across the organization to improve profitability.

These estimates are subject to change. Also, Acorn reminds investors that its operating results in each period vary significantly as a result of the mix of products sold in the period and the platforms through which they are sold. Therefore, the operating results for interim periods are not necessarily indicative of results that may be expected for any other interim period or for the full year. Consequently, in evaluating the overall performance of Acorn's multiple sales platforms in any period, management also considers metrics such as operating margin and gross profit return on advertising expenses.

Fourth Quarter 2012 Results:

• Net revenues were $59.1 million, down 32.4% from $87.5 million for the fourth quarter of 2011.  
• Diluted loss per American Depositary Share ("ADS") was $0.30 compared to diluted loss per ADS of $0.03 for the fourth quarter of 2011.

"Our full year results came in below our expectations, primarily due to weak demand and intense competition in China's mobile phone market that depressed mobile phone sales more than previously anticipated. We also experienced lower sales of electronic learning products as we transitioned the business to focus on models with mobile internet interactive features in the latter half of the year. We were able to partially offset these declines with exceptional performance from our line of fitness products, which accounted for 25.7% of gross revenues in 2012 and was the main driver behind the 2.5% increase in our gross margin. Despite our success in improving gross margin and controlling our operating expenses, the lower revenue base resulted in a larger than anticipated net loss in 2012," said Mr. Don Yang, CEO of Acorn.

"We are optimistic about the future of our business and have a solid plan in place to increase our top line and improve profitability in 2013. We expect fitness products and electronic learning products to continue to be major sales drivers in the year ahead and have a number of product upgrades and new product launches planned. Building upon the positive customer acceptance of our new electronic learning products, we will broaden our marketing efforts to include advertising on our direct TV sales channel which we expect to have a meaningful impact on sales in 2013. We have expanded our Aoya cosmetics line and have a number of new product launches planned in the coming months. In addition, based on the insurance business cooperation agreement with Sino-US United MetLife Insurance Co., Ltd. ("Metlife"), we are jointly marketing and selling short-term accident and health insurance products with Metlife through various channels and expect to further expand our insurance business in 2013. With media costs expected to increase in 2013, we will continue to optimize our media spending by focusing on the most profitable product categories and most productive TV channel partners. We expect the recent enhancements to our other direct sales channels, particularly Internet and outbound calls, and the improvement to distribution channels to help drive top line growth in 2013 and beyond."

Fiscal Year 2013 Business Outlook:

Based upon current trends, the Company expects for the full year 2013 revenues between $290 million and $310 million and net income between $0 million and $2 million.

In 2013, Acorn plans to launch upgrades to its popular line of fitness products and introduce new electronic learning products and other new product lines. The Company expects these new products along with sales of its expanded Aoya cosmetics line and new mobile phones to drive overall revenue growth in 2013. The Company will seek to further improve the effectiveness of its media spending by promoting its most profitable products and working with the most productive TV channel partners. In addition, the Company believes recent enhancements to its Internet and outbound calls channels, along with planned improvements to its distribution channel to contribute to overall revenue growth. Acorn's management will continue to enhance cost efficiencies across the organization with the goal of improving profitability.

Third Quarter 2012 Results

• Net revenues were $69.2 million, down 35.8% from $107.8 million for the third quarter of 2011.
• Diluted loss per American Depositary Share ("ADS") was $0.04, compared to diluted earnings per ADS of $0.05 for the third quarter of 2011.

"In the third quarter of 2012, our net revenues declined by 35.8% compared to the same period in 2011 as we continued to see softer demand in the fiercely competitive mobile phone market and lower sales in electronic learning products and consumer electronics. On a sequential basis, however, our net revenues were up by 50.1% over the second quarter of 2012, reflecting favorable seasonal trends and positive customer recognition relating to some of our new products. Fitness products, our top-selling product line representing 25.7% of total revenues in the third quarter of 2012, increased by 11.3 times over the lower sales in the same period of 2011. Our gross margin improved by nearly three percent over the same period last year, as we focused our media spending on our most profitable product lines, although lower sales volumes led to a small operating loss for the quarter," said Mr. Don Yang, CEO of Acorn.

"In addition, we introduced some new products in the third quarter of 2012 and will continue to test market some new products mainly on our TV direct sales platform for the remainder of 2012. We keep optimizing our media spending on top performing products to further improve profitability. We recently entered into an agreement with Sino-US United MetLife Insurance Co., Ltd. ("MetLife") to engage in joint promoting and selling of MetLife insurance products to our customers. We are taking steps to bolster the effectiveness of our outbound sales efforts and to strengthen our Internet sales as cost-effective alternatives to TV direct sales, which became more costly with the higher rates of TV airtime introduced in 2012."

Fiscal Year 2012 Business Outlook:

Based upon current trends, the Company is maintaining its prior guidance for the full year 2012 of revenues between $260 million and $280 million and a net loss between $14 million and $16 million.

Acorn plans to continue to optimize its media spending so as to concentrate on the most profitable product categories and the most productive TV channel partners, in support of some planned product launches in the fourth quarter. Based on the positive customer recognition to the Company's new electronic learning device, Acorn plans to further promote and broaden market awareness of this product. While sales of cosmetic products have been below expectations, the Company is developing more cost-effective Internet sales channels to improve sales volumes of its cosmetics product line. Acorn's management will continue to enhance cost efficiencies across the organization with the goal of returning to profitable operations.

Summary Financial Results for the Second Quarter of 2012:

• Net revenues were $46.1 million, down 44.3% from $82.9 million for the second quarter of 2011.
• Diluted loss per American Depositary Share ("ADS") was $0.17, compared to diluted earnings per ADS of $0.13 for the second quarter of 2011.

"In the second quarter of 2012, we saw a 44% decline in revenue, primarily due to decreased demand for existing mobile phone models and slower-than-expected sales of new mobile phone models launched in the second quarter of 2012. Higher media costs continued to impact the Company during the quarter, with rates 17% higher than the same period last year. In response, we reduced our TV advertising airtime by focusing on TV channels with the most effective media utilization and ceased the cooperation with less effective TV channels, which adversely impacted our TV direct sales, particularly for lower margin products. We also discounted prices of our older electronic learning products in order to clear our existing inventory in advance of the July launch of our new products incorporating mobile internet interactive features. Although we saw an improvement in gross margin and kept other operating expenses under control, we incurred a loss during the quarter," said Mr. Don Yang, CEO of Acorn. "Going forward, we will seek to maximize the effectiveness of our media spending and accelerate new product launches to energize our sales platforms, diversify our product mix and help us return to a growth trajectory. We recently introduced new product upgrades to our popular line of Yierjian fitness products that have been well received by our customers. We expect to see accelerated sales of our new electronic learning products from recent levels in the third quarter and plan to launch new beauty products in October in advance of the peak season for cosmetics. We will continue to monitor China's mobile phone market and plan to test market new models in the second half of the year. Additionally we will cooperate with certain insurance companies to promote and sell insurance products. Finally, we are also in the process of establishing a joint venture between Acorn and Guthy-Renker LLC ("Guthy-Renker"), which, upon completion, will sell Guthy-Renker branded products in China. We expect that such joint venture will be completed in the second half of 2012. "

Fiscal Year 2012 Business Outlook:

Due to lower-than-anticipated performance in the first half of 2012 and the overall macro-economic environment in China, the Company is revising its guidance. The Company now anticipates revenues between $260 million and $280 million and a net loss between $14 million and $16 million.

In the second half of 2012, Acorn will seek to improve effectiveness of its media spending by collaborating with its most effective TV channel partners to choose the best programs and times to air infomercials for its top performing products. Acorn also intends to build up new sales channels for its own branded products on the platforms of China's leading e-Commerce companies and plans to strengthen control and management of its distribution network, which is expected to have a positive impact on sales in the second half of 2012. The Company plans to further diversify its product offerings with seven to nine new products planned for the second half of 2012, including electronic learning products, fitness products, cosmetics and mobile phones, helping energize its direct sales platforms. At the same time, the management team remains focused on controlling costs and continuously improving operations.

First Quarter 2012 Results

• Net revenues were $68.1 million, down 18.9% from $84.0 million for the first quarter of 2011.
• Diluted loss per American Depositary Share ("ADS") was $0.08, compared to earnings per ADS of $0.03 for the first quarter of 2011.

"Revenues declined in the first quarter of 2012 primarily due to fewer mobile phone sales resulting from a decrease in existing phone model sales and the delayed launch of new feature phones. As China's mobile phone market transitions from feature phones to smart phones over the next few years, we intend to offer mobile phone products in both categories. We plan to introduce two smart phone models in the second quarter of 2012. Also adversely impacting our revenues during the quarter was an increase in media prices. As a result, we reduced the total amount of TV advertising airtime by focusing on TV channels with the most effective media utilization and ceased cooperation with less effective TV channels," said Mr. Don Yang, CEO of Acorn International. "At the same time, our fitness products, including the Yierjian abdominal trainer, continued to perform well and we are currently testing several new fitness products for full-scale sales and marketing programs in the second and third quarters of 2012. Meanwhile, we will introduce new cosmetic products and begin testing new electronic learning products with mobile Internet interactive features in the second and third quarters of 2012."

Fiscal Year 2012 Business Outlook:

In fiscal year 2012, Acorn intends to further enhance its direct sales platforms and improve the effectiveness of its media spending, thereby generating strong interest in its brands, improving its conversion rate and driving repeat sales. Acorn plans to further diversify its product offerings by introducing smart phones, extending its popular line of fitness products and introducing other new products. Acorn also plans to enhance its human resources, especially in areas of data analysis and customer relationship management, to help tailor products and services to both existing and new customers. Acorn intends to build up new sales channels for its own branded products on the platforms of China's leading e-Commerce companies. At the same time, the management team remains focused on controlling costs and continuously improving operations to enhance bottom line performance.

For the full year 2012, the Company affirms its guidance for revenues between $380 million and $400 million and net income between $6 million and $8 million.

Third Quarter 2011 Results

• Net revenues were $107.8 million, an increase of 18.2% from $91.2 million for the third quarter of 2010. 
• Diluted earnings per American Depositary Share ("ADS") were $0.05 and $0.11 for the third quarters of 2011 and 2010, respectively.

"The solid performance of our direct sales segment helped us maintain growth momentum during the third quarter of 2011. Non-TV direct sales were the main contributor, primarily as a result of sales generated from third-party bank channels and outbound calls that utilized our vast customer database resources for active sales outreach. While mobile handsets remained an essential product line supported by strong demand for our Gionee A320 and A350 models, direct sales in this product line were lower compared to the second quarter of 2011 due to the lower-than-expected contribution of our new high-end handset Gionee W100. We shifted marketing resources from our older models to support the newly launched model in August 2011, but have yet to reap the rewards of the campaign. On the other hand, the recovery in distribution sales of our electronic learning product (Ozing), which was primarily driven by our higher margin M8 model, was a positive development and we continue to closely follow the performance of this product line," said Mr. Don Yang, CEO and President of Acorn. "Our operating performance this quarter was significantly impacted by the $1.5 million bad debt provisions related to the transitioning of certain local delivery companies used to fulfill our direct sales orders to improve the successful goods delivery rate. However, one year after implementing significant management changes, our turnaround strategy has begun to show results in terms of top-line growth and improved gross margins. Looking forward, we aim to further develop our direct sales network and proprietary products, while working to maintain a nimble cost structure."

Fiscal Year 2011 Business Outlook

To date, Acorn has made significant investments to its TV direct sales platform and continues to optimize its growth and profitability by aligning media spending with its product portfolio. Non-TV direct sales remain the primary focus for growth as the Company continues to leverage its customer database mining efforts to generate repeat sales. Following the restructuring of its mobile handset product portfolio and the reallocation of advertising resources within this product line, the Company expects some quarter-to-quarter fluctuation in its mobile handset sales. Cosmetics, collectibles and health and fitness products offer additional support for direct sales, while the Company carefully monitors distribution sales of electronic learning products to assess the future growth potential of this product line.

For full year 2011, the Company reiterates its guidance of revenue between $340 million and $380 million. Due to $0.4 million in unbudgeted professional fees associated with the July 2011 Tender Offer, $1.5 million in additional bad debt provisions related to the transition of certain local delivery companies used to fulfill the direct sales orders to improve the successful goods delivery rate, and an increase in the expected operating loss from $0.8 million, which was initially forecasted at the beginning of 2011, to $2.9 million related to the Company's decision to stop selling "Uking" branded mobile handsets, the Company is adjusting its net income guidance for full year 2011 to be between $5 million and $7 million.

Second Quarter 2011 Results

• Net revenues increased 36.0% to $82.9 million from $60.9 million for the second quarter of 2010, driven by a 68.2% increase in the sales of mobile handsets.
• Diluted earnings per American Depositary Share ("ADS") were $0.13, as compared to loss per ADS of 0.06 for the second quarter of 2010.

"This quarter, we made significant improvements in our top and bottom lines. Direct sales drove overall revenue growth, which is consistent with our strategy to shift our sales mix toward more profitable channels and products." said Mr. Don Yang, CEO and President of Acorn, "Overall sales increased 36.0% from the second quarter of 2010, substantially faster than the increase in overall retail sales in China. The overall sales of mobile handsets grew 68.2% to $54.5 million for the second quarter of 2011 from $32.4 million for the same period of 2010, and were robust as we gained incremental market share in the mobile handsets market."

Fiscal Year 2011 Business Outlook

Acorn will continue seeking to optimize its media spending and product mix in order to drive revenue growth, enhance margins and achieve sustainable cash returns on investment. The Company plans to focus on its direct sales platforms and the growing demand for mobile handsets, collectibles, cosmetics and English learning products.

For fiscal year 2011, the Company reiterates its guidance of revenue between $340 million and $380 million and guidance of net income between $8 million and $10 million.

These estimates are subject to change. Also, Acorn reminds investors that its operating results in each period vary significantly as a result of the mix of products sold in the period and the platforms through which they are sold. Consequently, in evaluating the overall performance of Acorn's multiple sales platforms in any period, management also considers metrics such as operating margin and gross profit return on advertising expenses.

Tender Offer

In early July 2011, an investment vehicle controlled by Acorn's Chairman and a co-founder, Mr. Robert Roche, and his wife and Acorn's CEO, President and a co-founder, Mr. Don Yang, successfully completed a tender offer to acquire 20 million ordinary shares of the Company at a price of $2.00 per share (or $6.00 per ADS).

SHANGHAI, June 17, 2011 /PRNewswire-Asia/ -- Acorn International, Inc. (NYSE: ATV) ("Acorn" or the "Company"), a media and branding company in China engaged in developing, promoting and selling products through extensive direct sales and distribution sales platforms, today announced that its Board of Directors voted to recommend that Acorn shareholders reject the Bireme Limited ("Bireme") cash tender offer (the "Offer") of $2.00 per ordinary share (equivalent to $6.00 per American Depositary Share) (the "Offer Price") as inadequate and not in the best interests of Acorn and its shareholders.

The Company has filed a Schedule 14D-9 with the Securities and Exchange Commission ("SEC") detailing the reasons for its rejection of Bireme's offer. The full text of the filing will be available in the Investor Relations section of Acorn's website at http://ir.chinadrtv.com.and on the SEC website at http://www.sec.gov/.

The two shareholders of Bireme are Ms. Ritsuko Hattori-Roche, who is the wife of Robert Roche, the co-founder and the Chairman of the Board of Directors of Acorn, and Don Dongjie Yang, who is a co-founder, the Chief Executive Officer and a member of the Board of Directors of Acorn.

The Offer was reviewed and considered by members of the Board of Directors of Acorn who are unaffiliated with Bireme, Mr. Roche, Ms. Hattori-Roche and Mr. Yang. In making its determination, the Board, taking into account advice received from its financial and legal advisors, considered numerous factors, including their belief that:

The Offer is inadequate

• The Board does not believe that the Offer Price reflects the underlying value of Acorn's assets, operations and growth prospects, and the additional value that the Board believes would result from the continued implementation of Acorn's strategic business initiatives.

• Acorn's book value per share, as of December 31, 2010, is approximately $2.04 per Ordinary Share (or $6.13 per ADS) based on the number of Ordinary Shares outstanding as of June 3, 2011, which is higher than the Offer Price, and this book value is derived without taking into consideration the actual market value of Acorn's properties or the value of Acorn's intellectual property, brand, reputation and revenue producing businesses.

• Acorn has strong cash reserves. As of December 31, 2010, Acorn had cash and cash equivalents of $91.7 million and no long term debt. This unlevered cash represents approximately $1.03 per Ordinary Share, or $3.08 per ADS, based on the number of Ordinary Shares outstanding as of June 3, 2011.

• The Offer undervalues the key strengths of Acorn, including its:

◦ proven track record of developing, promoting and selling consumer products through its vertically integrated sales platform;

◦ ability to efficiently access media channels and manage Acorn's media time on its TV direct sales platform; and

◦ ability to adapt and evolve its business model in conjunction with China's direct sales industry and market conditions over the years.

• The implementation of Acorn's current and future plans will bring additional value to Acorn and its shareholders, which are not reflected in the Offer Price.

The Offer is opportunistic

• The Board believes that Mr. Roche and Mr. Yang, as insiders of the Company and long-time industry participants, recognize the significant medium- and long-term value creation potential of the Company's assets and recent strategic initiatives and the potential returns from the pursuit of such initiatives, and have opportunistically timed their Offer to acquire control of the Company before the full impact of these factors can be reflected in the Company's results of operations and share price.

• The Board also believes that the Offer is being made at a time when market valuations of PRC-based companies are being driven down, thus the current market condition is not reflective of a more normal market environment.

The Offer, if fully subscribed, will give the Offer Participants actual control of the Company

• If the Offer is fully subscribed, Mr.Roche, Ms.Hattori-Roche and Mr.Yang (the "Offer Participants") together with certain entities that are affiliated with or related to them will beneficially own in the aggregate approximately 52% of the outstanding shares of the Company. As a result, if the Offer Participants act together, they will be able to exert substantial influence and actual control over the Company and its policies, including the ability to prevent certain types of corporate transactions that other shareholders might favor, such as a merger or scheme of arrangement with a third party buyer.

• Further, if they act together, the Offer Participants will have the ability to control the vote regarding such matters as the election or removal of the Company's directors.

The Offer is coercive

• The Board believes that a partial, or limited, tender offer for a small-cap company like Acorn is structurally coercive because shareholders may be concerned that if they do not tender their shares in the Offer they may be left holding illiquid securities, because of the small public float and the risk that Acorn may become delisted.

The Offer does not require a favorable recommendation by the Board

• The Offer does not require a favorable recommendation by the Board. Further, the Offer Participants have not indicated a willingness to negotiate the Offer Price with the Company or the Board and therefore the Board cannot be certain the Offer Price represents the highest price Bireme would be willing to offer for the Company's shares.

The Offer has numerous conditions

• The Offer includes many conditions to the obligations of Bireme to purchase the shares tendered in the Offer, many of which vest a great deal of discretion in Bireme to determine whether or not they are satisfied, resulting in substantial uncertainty as to whether Bireme would be obligated to consummate the Offer.

• More specifically, the Offer states that the conditions described in the Offer are for the sole benefit of Bireme and may be asserted or waived by Bireme in whole or in part at any time and from time to time in its sole discretion at or prior to the expiration of the Offer (other than those involving the receipt of any requisite governmental approvals). The determination as to whether any condition to the Offer has or has not been satisfied is based on the reasonable judgment of Bireme and, subject to applicable law, will be final and binding on all parties.

Houlihan Lokey (China) Limited is acting as financial advisor to Acorn and O'Melveny & Myers LLP is providing legal advice. Maples and Calder is providing Cayman law advice.

First Quarter Results:

• Net revenues were $84.0 million, an increase of 19.4% from $70.3 million for the first quarter of 2010.
• Diluted earnings per American Depositary Share ("ADS") were $0.03 for the first quarter of both 2011 and 2010.

"The year began on a positive note reflecting top-line growth and improved profitability. Direct sales were the primary driver of our growth, as we maintained the momentum in non-TV direct sales, in particular our sales of mobile handsets. During the quarter, we introduced the new Gionee A350 model, which is an updated version of Gionee A320 model, our best selling product in 2010. The new product launch enabled us to introduce premium pricing, improving the profitability of our mobile handset sales," said Mr. Don Yang, CEO and President of Acorn. "Following our efforts to re-position our business, we have adopted a new performance review system which focuses on the optimization of our media return and spending. We also plan to further enhance our customers' loyalty through a more effective business strategy: higher product quality and better customer service, thereby achieving higher product profitability."

For fiscal year 2011, the Company maintains its guidance of revenue between $340 million and $380 million and net income between $8 million and $10 million.

Fourth Quarter Highlights:

• Net revenues were $70.8 million, an increase of 18.6% compared to $59.7 million in the fourth quarter of 2009.
• Diluted loss per American Depositary Share ("ADS") from continuing operations were $0.32 and $0.36 for the fourth quarters of 2010 and 2009, respectively.

"2010 saw many changes in Acorn. After twelve years since Robert and I founded Acorn, we both returned to more active management roles in the Company in October last year. We have since been working hard on re-positioning Acorn based on the Company's core values and re-evaluating Acorn's various business lines to steer the Company back to growth. Much of the restructuring is still taking place as we expect the process to continue into the early part of 2011," said Mr. Don Yang, CEO and President of Acorn. "We aim to build Acorn as the premium media and branding company in China. Through a focus on media efficiency, a gauge on which we intend to measure all parts of the company's business, we can effectively improve Acorn's overall profitability while expanding its media and industry presence. With Robert's success in running Oaklawn, a Japan-based TV direct sales operator, and Acorn's existing media resources, we are optimistic of Acorn's ability to regain its growth momentum."

Summary Results for the Third Quarter 2010:

• Net revenues were $91.2 million, a decrease of 0.7% compared to $91.8 million in the third quarter of 2009.
• Diluted earnings per American Depositary Share ("ADS") from continuing operations was $0.11, compared to $0.09 for the same quarter 2009.
  

"The third quarter 2010 financial results came largely in line with our expectations.  While net sales declined by 0.7% to reach $91.2 million in the third quarter 2010 from $91.8 million in the same period last year, our income from continuing operations increased by 27.6% to reach $3.2 million from $2.5 million in the same period last year.  TV direct sales continue to grow with our success in customer database mining and strong sales in mobile handsets while market downturn in English Learning Products continues to affect our sales in Ozing and limit our growth in distribution sales in the third quarter 2010," said Mr. Don Yang, CEO and President of Acorn.  "We are carefully accessing each part of our business with the recent change in management and hope to take the opportunity to sharpen our focus and re-grow our business.  As founder and now also CEO and President of the Company, I am proud of what Acorn has achieved thus far and delighted for the great responsibilities newly bestowed upon me for taking the Company to a higher ground."

Full Year 2010 Business Outlook:

For fiscal year 2010, the Company reiterates guidance of revenue between $290 million and $310 million and breakeven in net income from continuing operations (excluding share-based compensation expenses).

These estimates are subject to change. Also, Acorn reminds investors that its operating results in each period are impacted significantly by the mix of products and services sold in the period and the platforms through which they are sold. Consequently, in evaluating the overall performance of Acorn's multiple sales platforms in any period, management also considers metrics such as operating margin and gross profit return on advertising expenses.

"While the second quarter is traditionally a slow season for our distribution business, we expect year over year improvement in our direct sales in the second quarter of 2010 from continued growth in our non-TV direct sales business and improved mobile handset sales led by the diversification of handset models," said Mr. James Hu, Chairman and CEO of Acorn. "We understand the challenges ahead and will focus our efforts on improving the sales of our Ozing electronic learning products and mobile handsets while continuing to expand our non-TV direct sales and identify new products to be marketed on our platform. With the current business outlook, we will maintain our guidance previously set forth and will strive to achieve the financial targets of:

• Revenue between $290 million to $310 million
• Income from continuing operations of $12 million and $14 million for fiscal year 2010."