14 Nov YuuZoo Continues Delivering Resilient Results
- 2017 Q3 net profit SGD 15.7 million, 13% increase from 2016 Q3
- Q3 EBITDA at SGD 14 million, 54% increase from 2016 Q3
- Q3 2017 revenue was SGD 15.7 million, 13% higher than Q3 2016’s SGD 13.9 million. The increase was mainly due to improved franchise and celebrity branded network sales.
Summary of financial results for three months ending 30 September:
|2017 SGD (,000)||In percent (%)||2016 SGD (,000)||In percent (%)||Variance
Singapore, 14 November 2017: Singapore-listed YuuZoo Corporation Limited (“YuuZoo” or “the Company”) (SGX: AFC) in Q3 posted a net profit of SGD 7.9 million, an increase of SGD 1.5 million from corresponding period in 2016 which had a net profit of SGD 6.3 million.
The Company’s EBITDA margin is 89% at SGD 14 million compared to the corresponding quarter in 2016, which had an EBITDA margin of 54% at SGD 9 million dollars.
The Company’s Q3 2017 revenue was SGD 15.7 million, 13% higher than Q3 2016’s SGD 13.9 million. The increase was mainly due to improved franchise and celebrity branded network sales. The Company continues to grow its revenue despite the change in revenue recognition policy, which recognises lower franchise revenue than in 2016.
Accounting Policy Changes
In 2016, YuuZoo’s accounting policy on the sale of franchises was based on the advice of a “Big Four” accounting firm, which fulfilled all accounting requirements under FRS. YuuZoo has decided, after discussions with various parties including SGX-ST and its auditors, to discontinue the “Big Four”-advised accounting policy of booking as revenue the value of the shares it receives as payment for the franchises it sells. Booking the full value of the shares as revenue has been replaced by booking as revenue a one-time franchise fee based not on valuation but on YuuZoo’s cost of developing the franchise packages YuuZoo sells. Compared to the previous DCF-based valuation method, the new policy completely delinks the price of the franchise from expected future earnings.
YuuZoo was one of the organisers for SME50 Africa Conference in July, an event geared towards empowering and equipping millions of local businesses to build a stronger global brand and presence. Additionally, YuuZoo’s mobile games have been reaching number one spots – with Infinity Warriors in Australia’s Google Play Store, and Unstoppable Rex in Hong Kong.
In August through a joint venture with the management of Cinram Logistics France, YuuZoo set up YuuLog Europe – strengthening its entire value-chain from marketing and sales, to payments and delivery. This was followed shortly by an integration of its eCommerce platform with Vinculum in September, which gave YuuZoo strategic access to all brands and merchants serviced by Vinculum.
Recently in October, YuuZoo announced news of its board and top management expansion to include experienced international corporate governance, finance, investments, marketing, logistics and eCommerce members. YuuZoo also gained tax free status in Thailand for the next eight years, and launched Tribe Nation (a subscription app) in India, as well as, Miss Supertalent of the World Season 9 in South Korea.
Outlook for the current financial year ending 31 December 2017
Mohandas, COO of YuuZoo, said: “Industry growth is expected to continue to be strong in all key areas YuuZoo operates in; tribal social networking, e-commerce, online and mobile payments, mobile games and streaming video services. The growth is expected to increase the number of new competitors entering the market. YuuZoo believes its unique concept of growing internationally through a network of franchisees and partners, and its focus on developing unique disruptive new business models that can be patented will continue to give the Company a competitive edge over the next 12 months.”