Reports Strong Quarter With 123% Cash Receipt Increase
Sydney, April 29, 2016 AEST (ABN Newswire) - Global anti-counterfeit and brand protection solution company YPB Group Limited (
ASX:YPB) is pleased to report a strong quarter-on-quarter increase in cash receipts of 123% to A$775,000 in Q1 2016.
Highlights:
- Q1 cash receipts from customers increased by 123% vs Q4 2015
- Affyrmx JV, established in Q1 2016, showing excellent early promise in the Government vital documents segment, receiving four orders since launch
- Currently servicing 152 active customer accounts across the world
- Strong business development pipeline in place with over 150 active projects
YPB has built an outstanding launchpad from which to strongly grow revenue and move the company into profitability in 2017.
YPB completed the assembly of the technologies, talent, relationships and geographies necessary for a genuine global franchise in late 2015. Having built that launchpad, commercial lift-off has begun in earnest with strong confirmation since that there is a hungry market that both needs anti-counterfeit solutions and wants direct customer engagement. YPB is well positioned in a huge market given the applicability of its solutions to many products, sectors and countries. YPB is set for rapid market penetration, multiplying its own resources by partnering with established entities in target areas. This multiplier-partnership model not only offers rapid growth but also clearly lowers risk by minimising capital needs, headcount and other fixed costs. The revenues are sticky, recurring and highly reliable with high switching costs, while gross margins are typical of products with strong intellectual property content.
In 2016 and onwards YPB will benefit from strong macro tailwinds from:
- The rise of a massive new market in the pan-Asian middle-class;
- The collapse of mass marketing and the flow of marketing funds into direct customer engagement; and
- The need for Government vital documents to upgrade to new generation, genuinely fake-proof technologies
Key achievements in Q1 2016 include:
- Government vital documents - In 2015 YPB entered the Government vital document market with excellent initial results including the technology being supplied to millions of first world passports, with further recent success . In Q1 2016 YPB announced a JV in Mexico with Affrymx, that has already generated four orders for Government vital documents with significant contract opportunities in the pipeline. This JV is generating meaningful revenue and offers significant growth potential for YPB throughout 2016.
- Accelerating global sales - YPB continues to accelerate revenue growth from the two largest economies in the world, USA and China. YPB's China operations have now started to generate meaningful revenues with two large supply contracts. YPB's full suite of technology is being sold in the USA to a wide and growing range of applications with increased revenue flows to become apparent later in the year. With operations in USA, China, Australia, Thailand and recently Mexico, YPB has a growing, highly motivated and talented team.
Outlook
YPB expects strong growth in revenue in 2016, although this will be heavily weighted to the second half. As noted, YPB is moving from a strategic platform development phase into a vigorous commercial launch phase where the technologies, talent and relationships assembled will be leveraged into high quality, recurring revenues and ultimately high quality, reliable profitability over coming years.
YPB presently services 152 accounts across a range of solutions and technologies. Increased servicing of this only lightly tapped resource will see increased revenue flow to YPB. In addition, the expanded senior management, sales and business development teams have created a record pipeline opportunity for YPB with over 150 active projects in well targeted geographies, sectors and products. The engagement level of potential customers with YPB's solutions is high and virtually all pipeline customers are solely considering YPB's solutions. Further, YPB will continue to build strategic partnerships in key markets that will multiply its resources to achieve far more rapid, capital-efficient market penetration with far lower risk than the company could ever achieve alone.
YPB's Executive Chairman John Houston commented: "It is pleasing to see the first fruits of our strategic development with 123% growth in Q1 2016 cash receipts. We are now intensely focused on converting the latent value in our unique technologies, talent and relationships into revenues, profits and shareholder wealth over the next few years."
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http://abnnewswire.net/lnk/Z63009H4
About YPB Group Ltd
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