Preliminary Final Report 2015
Hong Kong, Feb 29, 2016 AEST (ABN Newswire) - 99 Wuxian Ltd (ASX:NNW) earned a profit of RMB 0.95 cents per share. The Company did not propose any dividend distribution or buy back during the period.
Since the Company was established in May 2013, 99 Wuxian has positioned itself as the leading business to business to consumer ("B2B2C") Chinese mobile commerce company to take full advantage of the strong industry trends in Chinese m-commerce. During 2015, 99 Wuxian focused on implementing its strategy of increasing its registered users, increasing user engagement, expanding its platform across merchants, business partners and into new channels to market.
99 Wuxian achieved a number of significant operational and financial milestones in 2015. 99 Wuxian delivered FY2015 revenue of RMB 192.3 million up from revenue of RMB 154.2 million in FY2014 and net profit after tax of RMB 10.2 million in FY2015 up from net profit after tax of RMB 7.0 million in FY2014. 99 Wuxian's significant revenue and profit growth was underpinned by delivery of substantial operational performance and initiatives including the addition of more than 13 million registered users, addition of 11 new business partners thus enlarging the pool of underlying customer base, and launching several highly successful joint marketing campaigns.
The Company continues to attract high value business partners and expand its reach in China. The platform has established relationships with 71 of China's leading financial institutions, telecommunications and insurance companies. During 2015, the Company added 11 new business partners reflecting the continued adoption and success of the platform. The Company is actively focussed on developing new channels to market while also continuing discussions with its existing business partners to on board them onto the reward redemption platform. For each of these partners the Company has developed tailored connections, via APPs, between them and their customers in a trusted and secure environment.
Through the business partners on its platform the Company has access to the mobile user customer base of each partner. The Company has grown its user base to 54.51 million registered users as of 31 December 2015, up from 40.79 registered users as of 31 December 2014.
In order to maintain its high business standards for product and service quality, the Company maintains a select universe of 155 top-tier merchants who offer virtual and physical goods for purchase through 99 Wuxian's platform. The Company continues to actively monitor and manage its product and merchant mix in response to evolving user demand including in 2015 with high quality additions headlines by leading merchants. In 2015 the company successfully enriched and optimised product and product mix such as petrol cards, healthcare products, virtual vouchers, etc. The Company has a strong pipeline of new products for release over the medium term and will continue to optimize its product mix in order to increase commission rates.
To build the user base and to drive transactions, the Company has initiated a number of joint promotions with business partners and merchants offering exclusive opportunities for users to purchase goods and services. Joint promotions have been conducted with a number of business partners.
The Company expects that the current portfolio of business partners will provide continued organic growth in registered users which is underpinned by the inexorable growth of the m-commerce market in China.
In 2015, the Group has entered into a binding conditional agreement (the "Ofpay Agreement") to acquire 100% equity interests in Jiangsu Ofpay E-commerce Limited ("Ofpay"), a leading upstream wholesaler of online transaction services and product. The transaction allows 99 Wuxian to enhance online market channel visibility, increase virtual product supply continuity, increase virtual product diversity, increase competitive market positioning, and expand scale of operations in preparation of future partner engagement growth.
In terms of the competitive landscape, 99 Wuxian holds a unique and dominant position in the B2B2C segment. A number of large B2C m-commerce businesses have well established brands in China which is why the Company has adopted a B2B2C strategy. In this space the barriers to entry are high and durable, given the difficulty for competitors to establish similar partnerships with banking and telecommunications companies, and there are few, if any, comparable businesses.
With initial critical mass achieved, the Company is shifting its focus to extracting maximum value from the user base by increasing both the value and volume of transactions, thereby growing revenues. In addition to continuing to market to the user base through joint promotions with business partners and merchants, other initiatives are being undertaken to facilitate the growth in both volume and value of transactions through the marketplace. It is expected this will be bolstered by the macro trend of increasing propensity of users to transact via m-commerce, with larger values per transaction.
A key strategic focus during the next phase of the company's growth is the ability to unlock the value of the Company's proprietary 'big data'. The scale and volume of transactions the Company has built together with Handpay has enabled the collection of significant amounts of data relating to consumer behaviour and transactions. This enables the Company to work with its business partners to deepen their relationships with their customers and provide offers tailored to specific needs.
The Company is pleased with its progress to date, delivering significant revenue and profit growth in FY2015, executing its business strategy and building a critical mass of quality business partners, merchants and registered users that now enables it to focus on maximising the revenue potential of the 99 Wuxian platform.
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About 99 Wuxian Ltd
99 Wuxian Ltd (ASX:NNW) aggregates over 300 million high quality consumers and 155 leading merchants through a marketplace embedded within the mobile apps of China's leading banks, telecommunications and insurance companies. 99 Wuxian enables increased customer satisfaction, loyalty and retention for its business partners by offering consumers the lifestyle convenience of purchasing virtual and physical goods on a mobile device.
99 Wuxian Ltd