omniture

Cogobuy Announces 2016 First Quarter Unaudited Operating Results

Cogobuy Group
2016-05-19 19:30 3630

HONG KONG, May 19, 2016 /PRNewswire/ --

Highlights for the three months ended March 31, 2016:

  • The Group's Gross Merchandise Value ("GMV") was RMB3,886.8 million, an increase of 56.0% year-on-year ("YoY")
  • Online transaction customers[1] as at March 31, 2016 reached 11,590, up 92.6% YoY
  • Non-GAAP profit attributable to equity shareholders[2] of the Company was approximately RMB100.2 million, up 30.1% YoY

Cogobuy Group ("Cogobuy" or the "Company", stock code: 400.HK; with its subsidiaries (the ''Group'')), the largest e-commerce platform serving the electronics manufacturing industry in China, is pleased to announce its unaudited operating results for the three months ended March 31, 2016 (the "Period").

During the Period, the Company's three major businesses achieved robust growth. The total GMV of the Company's operations grew to RMB3,886.8 million, a YoY increase of 56.0%; with 61.9% derived from direct sales, 25.0% from online marketplace platforms, and 13.1% from the supply chain financing business. In total, 43.0% of GMV came from blue chip customers, while 57.0% came from small and medium enterprise ("SME") customers. INGDAN.com is a platform dedicated to connecting global intelligent hardware entrepreneurs with supply chain resources. During the period, GMV contributed by the INGDAN.com platform was RMB400.6 million, 10.3% of the total GMV.

The Company's robust growth during the Period was largely the result of two factors: increasing number of new customers -- that are mainly SMEs -- and expansion in new business areas such as intelligent vehicles ("smart cars"). INGDAN.com's strong marketing initiatives and increasing brand influence drove much of the new growth. The number of online transaction customers reached 11,590 as at March 31, 2016, of which approximately 1.4% were blue chip customers and 98.6% were SME customers. This represents an increase of 92.6% over the Company's 6,017 customers as at March 31, 2015. As at March 31, 2016, the number of registered customers reached 59,593, compared to 35,682 as at March 31, 2015.

During the Period, the Company recorded a total revenue of RMB2,426.5 million, a YoY increase of 27.3%. Net profit attributable to equity shareholders of the Company grew significantly to approximately RMB85.1 million, a YoY increase of 19.0%. Gross margin was 8.1%. Non-GAAP profit attributable to equity shareholders[2] of the Company was approximately RMB100.2 million, representing an increase of 30.1% YoY. Non-GAAP operating expenses[3] were RMB70.9 million. Non-GAAP operating margin[4] was 5.2%. The effective tax rate of the Group was 13.8% and its non-GAAP effective tax rate[5] was 12.5%.

During the Period, the Group generated positive operating cash flow of approximately RMB54.2 million. Cash and cash equivalents and pledged deposits amounted to RMB2,426.9 million as at March 31, 2016. Inventory turnover days[6] and account receivables turnover days[7] were 27.9 days and 45.2 days, respectively.

Business Highlights

  • The Company officially launched the IngDan Lab, which is the Company's research institute and business incubator for the intelligent hardware industry. The lab is a platform that brings together the most advanced technologies and offers them to companies with high demand for them.
  • IngDan HK Experience Center has been launched. This is the first experience center outside Mainland China. The center connects entrepreneurs from around the world with an extensive supply chain and an innovation ecosystem in Mainland China.
  • Cogobuy and INGDAN.com entered the smart car industry to establish and build the smart car ecosystem. In April 2016, INGDAN.com collaborated with Mobileye, a leading global manufacturer of advanced driver assistance systems (ADAS) from Israel. The parties began working together to promote Offline to Online ("O2O") services in the Chinese auto market. INGDAN.com has been laying out its strategic plans in Chongqing, a key R&D and manufacturing market for the automobile industry. It has facilitated Mobileye's discussions with important automobile manufacturing enterprises and government departments in Chongqing.

Outlook

Mr. Jeffrey Kang, CEO of Cogobuy Group, said, "We were pleased to see strong growth in each of our business lines in the first quarter of 2016. Fueled by the significant increase of new customers, our results have met market expectations. During the period, we saw tremendous growth over the previous year: In terms of customers' number, over 11,590 customers conducted online transactions with us, a 92.6% increase from the first quarter of 2015. For Cogobuy, increasing the number of new customers is a cornerstone for our long-term development.

"We are optimistic about our ability to deliver even faster growth in the second half of 2016. The first quarter results are usually modest relative to our other quarters due to seasonality. First quarter GMV typically contributes 18-20% of our annual GMV. As a rapidly changing Internet company, we prioritize growing our customer base, followed by GMV growth and sustainable earnings growth. It is a strategic choice for us to use existing resources and earnings to cultivate emerging and fast-growing industries that are paramount to sustainable growth. Under this strategy we have increased our investments in smart car and other emerging fields, while return from pre-project investments will help maintain our growth in business development in the second half of the year. On the other hand, with INGDAN.com we plan to deploy more focused monetization strategies. We believe this will create a solid foundation in the second half of the year.

"Currently, INGDAN.com provides O2O, one-stop supply chain services to intelligent hardware startups all over the world. It is now the largest intelligent hardware platform in China and aspires to become the world's largest intelligent hardware ecosystem. Our goal in entering the smart car industry is to reduce barriers and help automotive aftermarket companies connect with traditional car manufacturers directly. This will enable stakeholders to share manufacturing resources while boosting automotive aftermarket companies' development. As part of the initiative, we collaborated with Mobileye, a leading global manufacturer in the area of ADAS from Israel. Through INGDAN.com, we will work together to promote O2O services in the Chinese auto market. Our activities in Chongqing are a key piece in the overall strategy of building the smart car ecosystem. We have also made a series of breakthroughs in other industries that will be key for us going forward, including robotics, new materials and smart homes.

"In March 2016, Cogobuy was selected to become a constituent stock of the Hang Seng Composite LargeCap & MidCap Index. The inclusion makes Cogobuy's shares eligible for the Shanghai-Hong Kong Stock Connect scheme. After the launch of the Shenzhen-Hong Kong Stock Connect scheme, we anticipate a healthy diversification to our shareholder base and the ability to generate greater returns for our shareholders."

[1] 

Customers who had completed at least one online transaction during the current period and had completed at least one other online transaction in the previous fiscal year.

[2] 

Net profit attributable to equity shareholders add share-based compensation costs, amortization of intangible assets and its related deferred taxation effect.

[3]

Total operating expenses less share-based compensation costs, and amortization of intangible assets.

[4]  

Non-GAAP operating margin is non-GAAP profit of the period divided by revenue for the period. Non-GAAP profit is gross profit less non-GAAP operating expenses of the period.

[5]  

Non-GAAP effective tax rate is income tax expense less deferred taxation related to amortization of intangible assets divided by income before tax less share-based compensation costs and amortization of intangible assets.

[6]  

The average of the opening and closing balances of inventories of the period divided by cost of sales of the period and multiplied by 91 days.

[7] 

The average of the opening and closing balances of trade receivables for the period divided by revenue of the period and multiplied by 91 days.

Caution Statement

The information contained in this document has not been independently verified. No representation, warranty or undertaking, express or implied, is made by the Company or any of its affiliates, advisers or representatives as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of such information or opinions presented or contained herein. The information contained in this document should be considered in the context of the circumstances prevailing at the time, is subject to change without notice and the Company makes no undertaking to update the information in this document to reflect any developments that occur after the date of the presentation. It is not the Company's intention to provide, and you may not rely on these materials as providing, a complete or comprehensive analysis of the Company, or its financial or trading position or prospects. Neither of the Company nor any of its affiliates, advisers or representatives accept any responsibility or have any liability whatsoever (in negligence or otherwise) for any loss howsoever arising from any use of this document or its contents or otherwise arising in connection with this document.

This document may contain statements that reflect the Company's current intent, beliefs and expectations about the future as of the respective dates indicated herein. These forward-looking statements are not guarantees of future performance and are based on a number of assumptions about the Company's operations and factors beyond the Company's control and are subject to significant risks and uncertainties, and accordingly, actual results may differ materially from those described in these forward-looking statements. Neither the Company nor any of its affiliates, advisers or representatives has any obligation, nor do they undertake, to update these forward-looking statements for any events or developments including the occurrence of unanticipated events that occur subsequent to such dates.

About Cogobuy Group

Cogobuy Group is the largest e-commerce service platform serving the electronics manufacturing industry in China. Through the e-commerce platform, which includes a direct sales platform, an online marketplace, and a dedicated team of technical consultants and professional sales representatives, the Company provides customers with comprehensive online and offline services across pre-sale, sale, and post-sale stages. The Company serves mainly SME electronics manufacturers.

For further information, please refer to the Company's website at http://www.cogobuy.com/

About INGDAN.com

INGDAN.com is a platform dedicated to connecting global intelligent hardware entrepreneurs and China-based supply chain resources. The platform provides information on hardware innovation, supply chain data, and supply chain demand docking for global IoT innovators and entrepreneurs. It is a one-stop hardware innovation business platform with its core being the "supply chain."

For further information, please refer to the Company's website at http://www.ingdan.com/

Source: Cogobuy Group
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