Xinhua Finance Reports Financial Results for the Full Fiscal Year 2006

Xinhua Finance Reports Financial Results for the Full Fiscal Year 2006

February 15, 2007

Continued Execution of Growth Strategy Delivers
Better-Than-Expected Revenue and Net Income


    SHANGHAI, China, Feb. 15 /Xinhua-PRNewswire/ -- Xinhua
Finance (TSE Mothers: 9399 and OTC: XHFNY), China's premier
financial information and media service provider, today
announced, under International Financial Reporting
Standards ("IFRS"), consolidated revenue of
US$175.0 million and net income of US$18.7 million, which
represented gains of 59% and 82% respectively over those of
the last fiscal year.  Fully diluted earnings-per-share
(EPS) reached US$20.14, up from US$15.23 in 2005. 

    Following management's upward revision of projected net
income in November 2006, both revenue and net income came in
ahead of forecasts of US$166.0 million and US$18.5 million,
respectively.  Proforma EBITDA, adjusted to exclude
non-cash ESOP expense and one-time items, was US$32.4
million, with a margin of 18.5% which outpaced the full
year forecast of 15.4%.  Xinhua Finance provides proforma
results to help investors better understand the Company's
underlying operating and financial trends.

    Xinhua Finance CEO Fredy Bush commented, "This is
an exciting time for Xinhua Finance. As we have completed
our second full fiscal year as a public company, our
strategy for long-term profitable growth continues to drive
top- and bottom-line gains year on year.  I am pleased to
report that both our revenue and net income for the fiscal
year came in ahead of expectations.  Most importantly, we
have delivered on our promise to generate shareholder value
by positioning our global operations to profit from China's
internationalization."

    "I am happy to see that the investments we have
made in our core service lines generated encouraging
results.  As we extend our track record of financial and
strategic success, we are continuing on our mission to
bridge China's financial markets and the world."

    Xinhua Finance continues to make strides across its
service lines. The amount of assets tracking and
benchmarking the Company's indices worldwide increased to
over US$53 billion, from just under US$10 billion the end
of fiscal year 2005 based on management estimates.  Xinhua
FTSE indices achieved the largest market share among
benchmark indices in China, covering 46% of all newly
issued open-ended equity funds. The Ratings service line
was further bolstered by the acquisitions of Glass Lewis
and Praedea (renamed Mergent Data Tech).  

    Xinhua Finance also launched several new products in
Financial News, including China Bullet Points, China
Mainwire and Daily China News briefings, and expanded its
China news presence.  In Investor Relations Service Line,
both Xinhua PR Newswire and Taylor Rafferty opened new
offices (in Shenzhen and Hong Kong, respectively) to
accommodate their expansion in Greater China. 

    Xinhua Finance CFO Gordon Lau added, "Xinhua
Finance prides itself in its ability to capitalize on
opportunities to expand our business, while at the same
time maintaining a focus on cost controls and bottom-line
discipline. As a result, our fiscal year 2006 proforma
EBITDA margin, a key measure of the profitability of our
underlying businesses, was 18.5%, beating our forecasted
margin by 3.1%.  We continue to integrate our global
operations and streamline our sales and marketing approach
and have realized further synergies across the group
through effective implementation of cross-selling
initiatives."



    Fiscal Year 2006 vs. Fiscal Year 2005 (IFRS) - unit:
USD million   
  
                     Fiscal Year 2006   Fiscal Year 2005   
Change 
     
    Revenue                175.0            110.0          
  59%
    EBITDA(1)               23.3             21.2          
  10%
    Net Income              18.7             10.3          
  82%

    (1) EBITDA for FY2006 includes ESOP expense of US$8.1
million. For 
        FY2005, ESOP expense was US$0.2 million.



    Initial and Revised Forecasts vs. Fiscal Year 2006
(IFRS) - unit: USD
     million                                               
             
                             Actual                  
Forecasts         
                       FY2006    Variance(3)    Initial    
Revised(4) 
 
    Revenue            175.0         5%         166.0      
 166.0 
    EBITDA              32.4(2)     27%          25.6      
  25.6 
    Net Income          18.7         1%          13.8      
  18.5 

    (2) Proforma EBITDA excludes one time items and non
cash ESOP expense. 
        Xinhua Finance reports proforma results to help
investors better 
        understand the Company's underlying operating and
financial trends.
    (3) From revised forecasts 
    (4) Revised in November 2006 



    Fiscal Year 2006 (JGAAP) - unit: USD million  
                       
                       Fiscal Year 2006                  
    Revenue                175.0 
    EBITDA                  24.7 
    Net Income              10.8 



    Fiscal Year 2007 Forecasts (IFRS) - unit: USD million 

              
    Revenue                 228.7 
    EBITDA                   37.4 
    Net Income               27.3 




    Notes to Editors
    About Xinhua Finance Limited 
    Xinhua Finance Limited is China's premier financial
information and media service provider and is listed on the
Mothers board of the Tokyo Stock Exchange (symbol: 9399)
(OTC ADR: XHFNY). Bridging China's financial markets and
the world, Xinhua Finance serves financial institutions,
corporations and re-distributors through four focused and
complementary service lines: Indices, Ratings, Financial
News and Investor Relations.  Founded in November 1999, the
Company is headquartered in Shanghai with 20 news bureaus
and offices in 19 locations across Asia, Australia, North
America and Europe.  

    For more information, please visit
http://www.xinhuafinance.com . 

    This is a press release to the public and should not be
relied on as information to make an investment decision by
any investor. Investors should read the Company's
Securities Report filed to Tokyo Stock Exchange and
consider the risk factors together with other information
contained therein when making an investment decision. This
press release contains some forward-looking statements that
involve a number of risks and uncertainties. A number of
factors could cause actual results, performance,
achievements of the Company or industries in which it
operates to differ materially from any future results,
performance or achievements expressed or implied by these
forward-looking statements.


    Contact information:

    Xinhua Finance
    Hong Kong/ Shanghai
     Ms. Joy Tsang
     Tel:   [phone]
     Email: [e-mail]
    
    Japan
     Mr. Jiong Sun
     Tel:   [phone]
     Email: [e-mail]
    
    Taylor Rafferty (Media contact for Xinhua Finance)
    Japan 
     Mr. James Hawrylak
     Tel:   [phone]
     Email: [e-mail]
    
    United States
     Ms. Ishviene Arora
     Tel:   [phone]
     Email: [e-mail]
    
    Europe
     Mr. John Dudzinsky
     Tel:   [phone]
     Email: [e-mail]


SOURCE  Xinhua Finance