Final Results in FY2018
Sydney, Mar 8, 2019 AEST (ABN Newswire) - Retech Technology Co., Ltd (
ASX:RTE) ("Retech" or "The Company") a leading Shanghai-based technology solutions company, is pleased to provide a market update to accompany its full-year preliminary results for the period ended 31 December 2018, which is currently in the process of auditing.
Highlights
- Outstanding growth in FY2018 with net profit for the period increased RMB11.1 million (A$2.3 mn) due to the Company's improved business solution and market strategy in focused industries.
- The Company has upgraded its E-learning platform solution to Version 1.2 in 2018 and continuously to invest in developing E-learning SaaS platform in 2019.
- Subsidiary "Prosage" was established in 2018 as vehicle of ESG E-Learning service development in the future.
- Retech entered into a non-binding, conditional letter of intention to acquire the Victoria based XJS Coaching School.
Financials
The Company had great achievements considering its financial performance in 2018.
Revenue in 2018 was RMB130.5 million ($A27.4 million - see Note below) and increased by RMB26.3 million ($A5.5 million) or 25% comparing to the result of 2017. Gross profit was RMB82.4 million ($A17.3 million) and increased by RMB17.1 million ($A3.6 million) or 26% comparing to the result of 2017. Net profit for the period attributable to members was RMB49.2 million ($A10.3 million) and increased by RMB10.5 million ($A2.2 million) or 27% compared with 2017. Net profit for the period was RMB48.3 million ($A10.1 million) and increased by RMB11.1 million ($A2.3 million) or 30% comparing to the result of 2017.
Operational
The growth during the year was the result of Retech's better business solution released to market and increased market penetration in some of focused industries including financial, auto, retail and high-tech etc. The internal management for cost and expenses has been improved as well. Highlights from operation activities are as follows:
- Product
The Company has upgraded its E-learning platform solution to Version 1.2 in 2018. The platform solution has now integrated the key functions and standard practice models in financial and Auto industries. Thus, management expects this to strengthen the Group's product offerings to potential future clients and our position in the E-learning market. In 2019, Reunet will continue developing our E-learning SaaS platform, which will save our time and cost in customization of projects for future clients.
- Customers
The Company obtained more clients in its focused industries. Meanwhile, Retech Group has achieved further cooperation with the long-term key customers in its focused industries, such as Bank of China, Ping An, Mercedes-Benz, etc. We expect to continue focusing on these types of customers which expects to generate positive returns to the Group in the future.
- ESG service line
Prosage Sustainability Development Limited is a subsidiary established by Retech Holdings Co., Ltd in Hong Kong. Retech owns 90% interests in Prosage. Prosage is our vehicle to develop E-learning business for Environmental, Social and Corporate Governance compliance ("ESG") training. The ESG compliance training platform is under developing, which will enable Prosage's clients and its employees to learn concepts of ESG and facilitate their ESG reporting. The Company anticipate ESG service line to present new growth opportunities to the Group in the future.
- Potential Acquisition
On 8 December 2018, Retech entered into a non-binding, conditional letter of intention to acquire the Victoria based XJS Coaching School. XJS Coaching School is a private Chinese training institutionwith over 20 years history. It has great reputation in Chinese language training in Australia. Retech plans to cooperate with XJS Coaching School for Chinese language training business opportunities in Australia.
- Management
Retech appointed Mr Kang Li and Ms Meng Xiaoshi as the Company's non-executive directors. Mr Kang Li was appointed as the second Australian resident non-executive director of the Board. Ms Meng Xiaoshi, joined the Board as a director and a representative of City Savvy Limited on 18 January 2019. They will both leverage off their experience and expertise to provide professional recommendations and bring new opportunities to Retech.
Outlook
The Company expects continuous growth in FY2019 as it will continue enhancing the business solutions and market strategy in focused industries. Meanwhile, Retech are about to develop Australian market after acquiring XJS Coaching School.
Note: A$ 1 - RMB 4.77 (28 February 2019)
About Retech Technology Co Ltd
Retech Technology Co Ltd (ASX:RTE) is one of the largest technology solutions providers in China and provides solutions to companies that enable them to deliver corporate training online. The Company delivers solutions to a diversified and established user base via three channels: E-Learning Solutions, E-Training Partnership and E-Course Direct.
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