REG - Vmoto Limited - Operational Review to 30 June 2014 <Origin Href="QuoteRef">VMT.AX</Origin>
06/09/2014 22:35
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Vmoto Limited
30 July 2014
OPERATIONAL REVIEW FOR THE
QUARTER ENDED 30 JUNE 2014
ANNOUNCEMENT
30 July 2014
Vmoto Limited (ASX/AIM: VMT), the global scooter manufacturing and
distribution group specialising in "green" electric powered two wheel
vehicles, provides the following update on its activities during the quarter
ended 30 June 2014.
HIGHLIGHTS OF JUNE 2014 QUARTER
· Continued growth in quarterly positive operating cash flow to $143k; up
270% on March 2014 quarter
· Continued growth in quarterly unaudited normalised net profit after tax,
to ~$465,000 (excluding one off share based expenses); up 101% on March 2014
quarter
· Continued growth in quarterly unit sales to over 22,400; up 57% on March
2014 quarter
- approximately 15,000 units sold to OEM customers, over 3,600 sold through
Vmoto's retail stores, and balance sold through international and China
distributors and customers
· China distribution footprint now encompasses 16 company owned retail
stores, in addition to relationships with more than 10 external distributors
and dealers across China
· First container delivered to Vietnamese distributor and received further
orders for 120 units
· Delivered two sample scooters to Hong Kong distributor to supply to DHL, a
leading international delivery and courier group
· First container of scooters delivered to Indonesian distributor
· Progressing new market entry opportunities, including Mexico and Nepal
· New website launched - www.vmoto.com
SECOND CONSECUTIVE POSITIVE QUARTERLY NET OPERATING CASH FLOW
Vmoto's cash flow for the June 2014 quarter continued to improve, with the
Company achieving higher positive net operating cash flow of $143k, up 270%
compared to March 2014 quarter, and a substantial turnaround from the
operating cash outflow of $495k in June 2013 quarter.
Sales through the Company's retail stores and distributors, to OEM customers
and internationally was over 22,400 units, up 57% compared to the March 2014
quarter.
During the quarter, the Company repaid RMB9.9 million (approximately A$1.7
million) and drew down RMB7 million (approximately A$1.2 million). As at 30
June 2014, the total operating facility drawn down was RMB19 million
(approximately A$3.2 million) and the total undrawn operating facility was
RMB15 million (approximately A$2.6 million).
As at 30 June 2014, the Company had cash of A$2.8 million (unaudited).
TRADING UPDATE - GROWTH CONTINUES
The Company continues to grow earnings, with normalised net profit after tax
(excluding one off share based expenses of A$493,809 as a result of the issue
of performance rights, shares and options as approved at the Company AGM on 20
May 2014) generated for the June 2014 quarter of approximately A$465,000
(unaudited).
The Company's growing revenues and profits are a clear demonstration of the
increasing traction Vmoto brands are achieving in key markets in China and
Asia. The Company is becoming increasingly recognised for its premium
electric scooter products and is growing strongly and delivering on its
strategy.
The breakdown of unit sales (unaudited) for the June 2014 quarter is set out
below:
Unit sales March 2014 Quarter June 2014 quarter Total
OEM 8,133 14,963 23,096
China retail stores 3,071 3,609 6,680
Other Chinese distributors 1,015 1,630 2,645
International and others 2,038 2,246 4,284
14,257 22,448 36,705
EXISTING AND NEW CUSTOMERS - KEY LONG TERM GROWTH DRIVERS
PowerEagle: During the June 2014 quarter, Vmoto sold approximately 15,000
units of electric scooters to PowerEagle. The Company's relationship with
PowerEagle is strong and production continues with a target of 64,800 units
for the 2014 calendar year under the Strategic Cooperation Agreement.
E-Tropolis: Vmoto is actively discussing with E-Tropolis plans to increase
orders.
Hong Kong: During the quarter, Vmoto delivered two sample electric delivery
scooters to its Hong Kong distributor to supply to the Hong Kong branch of
DHL. DHL is the world's largest international logistics company and is present
in over 220 countries representing a significant market for Vmoto. The
feedback from the Hong Kong distributor has been positive to date.
Indonesia: Vmoto delivered the first container of its electric scooters to its
Indonesian distributor during the quarter and expects to receive more orders
from this distributor in the coming weeks. Indonesia, after China, is the
second largest market in the world for petrol motor scooters (Source: Pike
Research) and represents a large potential market for Vmoto.
Italy: Vmoto received an order for one container from its Italian distributor
in June 2014. The products are under preparation with delivery expected to the
distributor in August 2014.
Malaysia: Vmoto received an order for 72 units of its electric delivery
scooters in completely knocked down ("CKD") form from its Malaysian Original
Equipment Manufacturer ("OEM") customer during the quarter.
Mexico: Vmoto received sample orders from a new customer in Mexico in June
2014 and the samples are under preparation with delivery expected in August
2014.
Nepal: Vmoto recently received an order for one container from its new
customer in Nepal. The Company is actively preparing the products for its new
customer and hopeful that more orders will be received from the customer for
this new market.
Taiwan: Vmoto has recently supplied samples of its electric scooters to Kentfa
Advanced Technology Corp for evaluation and promotion in Taiwan. As part of
its evaluation of Vmoto's products, Kentfa organised an electric motorbike
test ride with the Taiwan Entrepreneur Association (Southern Chapter) on 7
April 2014 using Vmoto's electric two wheel vehicles. Feedback from the
attendees was very positive. The samples supplied to the Taiwanese distributor
have passed the required tests and have been delivered to the local
homologation department for certifying.
Vietnam: Vmoto delivered its first container of electric scooters to Vietnam
during the quarter and feedback from the distributor has been very positive.
Vmoto has since received further orders for 120 units from its Vietnamese
distributor.
Others: The Company's electric scooters were shipped to distributors in
Africa, Canada, Greece, Japan and South Korea.
VMOTO'S RETAIL STORE AND DISTRIBUTION CHANNELS IN CHINA
The Company's total retail store footprint currently stands at 16 retail
stores. In addition, Vmoto has relationships with more than 10 distributors
and dealers who distribute Vmoto's products in China. The Company expects that
the combined sales momentum will continue, with an increased emphasis to be
placed on existing and new distributors and dealers. Vmoto retail store roll
out is likely to slow to allow increased Vmoto management time to be allocated
to provide more support to new and existing distributors and dealer. Combined
profits from these two sales channels remains in line with management
expectations.
COLLABORATIONS, TENDERS AND JOINT VENTURE OPPORTUNITIES
The Company continues to receive significant interest from other electric
vehicle distributors and parties for potential collaboration or joint venture
opportunities. Discussions with these groups are ongoing and any material
developments will be announced as and when they occur.
EXHIBITIONS
During the quarter, the Company exhibited at the Post Expo Asia Pacific held
in Hong Kong over May 20-21 2014. Significant interest was generated in
Vmoto's products with guests at the exhibition including board level, senior
management executives from national postal operators, private postal and
mailing companies and parcel and courier companies from across Asia Pacific.
In addition, Vmoto's Taiwanese distributor exhibited Vmoto's electric two
wheel vehicle products at the Taipei International Electric Vehicles
Exhibition held on 9-12 April 2014 and again received positive feedback.
The Company's Vietnamese distributor participated and exibited in the 6th
Entech Hanoi exhibition held over May 21-23 2014. Over 180 booths exhibited in
the exhibition which was attended by over 140,000 visitors.
CORPORATE
During the quarter, the Company issued 9,035,000 shares on conversion of
options and a further 2,666,666 shares were issued to directors following the
vesting of performance rights. The Company also issued 4 million options and
20 million performance rights to directors of the Company following
shareholder approval on 20 May 2014.
During the quarter the Company also released a new website at www.vmoto.com.
POSITIVE OUTLOOK
The June 2014 quarter was a very productive quarter for Vmoto, with the key
highlights being the Company's increasing unit sales, as well as continued
growth in positive cash flow. Current trading remains in line with
management's expectations.
Utilisation of the Company's manufacturing facility in China is increasing and
becoming more efficient as production grows to service PowerEagle and Vmoto's
growing retail store footprint and distribution channels. This will continue
and is expected to increase over the remaining months of the year. In
addition the Company is seeking other means of increasing its own branded
sales in China with discussions with other electric vehicle distributors or
parties for potential collaboration or joint venture opportunities.
Internationally, the Company will continue to sell units into its existing
markets and customers as well as continue discussions with a range of
potential new customers across the globe.
For further information, please contact:
Vmoto
Charles Chen, Managing DirectorOlly Cairns, Non-Executive Director +61 8 9226 3865+61 8 9226 3865
Investors and mediaMarket Eye Pty LtdRonn Bechler +61 400 009 774ronn.bechler@marketeye.com.au
finnCap Ltd Ed Frisby/Christopher Raggett (corporate finance)Tony Quirke/Mia Gardner (corporate broking) +44 20 7220 0500
About Vmoto
Vmoto Limited (ASX/AIM: VMT) is a global scooter manufacturing and
distribution group. The Company specialises in high quality "green" electric
powered two wheel vehicles and manufactures a range of western designed
electric scooters from its low cost manufacturing facilities in Nanjing,
China. Vmoto combines low cost Chinese manufacturing capabilities with
European design. The group operates through two primary brands: Vmoto (aimed
at the value market in Asia) and E-Max (targeting the Western markets, with a
premium end product). As well as operating under its own brands, the Company
also sells to a number of customers on an original equipment manufacturer
("OEM") basis.
Rule 4.7B
Appendix 4C
Quarterly report
for entities admitted
on the basis of commitments
Introduced 31/3/2000. Amended 30/9/2001, 24/10/2005.
Name of entity
VMOTO LIMITED
ABN Quarter ended ("current quarter")
36 098 455 460 30 June 2014
Consolidated statement of cash flows
Cash flows related to operating activities Current quarter$A'000 Year to date(6 months)$A'000
1.1 Receipts from customers 10,910 16,349
1.2 Payments for (a) staff costs (b) advertising and marketing (c) research and development (d) leased assets (e) other working capital (including inventories) (337)(79)--(10,304) (639)(86)(3)-(15,339)
1.3 Dividends received - -
1.4 Interest and other items of a similar nature received 15 32
1.5 Interest and other costs of finance paid (62) (133)
1.6 Income taxes paid - -
1.7 Other (provide details if material) - -
Net operating cash flows 143 181
Current quarter$A'000 Year to date(6 months)$A'000
1.8 Net operating cash flows (carried forward) 143 181
Cash flows related to investing activities
1.9 Payment for acquisition of:(a) businesses (item 5) (b) equity investments(c) intellectual property (d) physical non-current assets(e) other non-current assets ---(9)- ---(16)-
1.10 Proceeds from disposal of:(a) businesses (item 5) (b) equity investments (c) intellectual property(d) physical non-current assets(e) other non-current assets ----- -----
1.11 Loans to other entities - -
1.12 Loans repaid by other entities - -
1.13 Other (net cash acquired on acquisition of subsidiary) - -
Net investing cash flows (9) (16)
1.14 Total operating and investing cash flows 134 165
Cash flows related to financing activities
1.15 Proceeds from issues of shares, options, etc. 243 245
1.16 Proceeds from sale of forfeited shares - -
1.17 Proceeds from borrowings 1,203 3,390
1.18 Repayment of borrowings (1,702) (5,401)
1.19 Dividends paid - -
1.20 Other (provide details if material) - (22)
Net financing cash flows (256) (1,788)
Net increase (decrease) in cash held (122) (1,623)
1.21 Cash at beginning of quarter/year to date 2,893 4,427
1.22 Exchange rate adjustments to item 1.21 (7) (40)
1.23 Cash at end of quarter 2,764 2,764
Payments to directors of the entity and associates of the directors
Payments to related entities of the entity and associates of the related
entities
Current quarter$A'000
1.24 Aggregate amount of payments to the parties included in item 1.2Aggregate amount of payments to the parties included in item 1.18 109 -
1.25 Aggregate amount of loans to the parties included in item 1.11 -
1.26 Explanation necessary for an understanding of the transactions
Payments include:Executive Directors' remuneration $A'00083 Non-Executive Directors' remuneration 26 109
$A'00083
Non-Executive Directors' remuneration
26
109
Non-cash financing and investing activities
2.1 Details of financing and investing transactions which have had a material effect on consolidated assets and liabilities but did not involve cash flows
Nil
2.2 Details of outlays made by other entities to establish or increase their share in businesses in which the reporting entity has an interest
Nil
Financing facilities available
Add notes as necessary for an understanding of the position. (See AASB 1026
paragraph 12.2).
Amount available$A'000 Amount used$A'000
3.1 Loan facilities 5.815 3.250
3.2 Credit standbyarrangements* - -
Reconciliation of cash
Reconciliation of cash at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts is as follows. Current quarter$A'000 Previous quarter$A'000
4.1 Cash on hand and at bank 2,764 2,893
4.2 Deposits at call - -
4.3 Bank overdraft - -
4.4 Other (provide details) - -
Total: cash at end of quarter (item 1.23) 2,764 2,893
Acquisitions and disposals of business entities
Acquisitions(Items 1.13 and 2.1) Disposals(Item 1.10(a))
5.1 Name of entity
5.2 Place of incorporation or registration
5.3 Consideration foracquisition or disposal
5.4 Total net assets
5.5 Nature of business
Compliance statement
1 This statement has been prepared under accounting policies which comply
with accounting standards as defined in the Corporations Act (except to the
extent that information is not required because of note 2) or other standards
acceptable to ASX.
2 This statement does give a true and fair view of the matters disclosed.
Shannon Coates
Sign here:
............................................................ Date: 30
July 2014
(Company Secretary)
Print name: Shannon Coates
Notes
1. The quarterly report provides a basis for informing the market how
the entity's activities have been financed for the past quarter and the effect
on its cash position. An entity wanting to disclose additional information is
encouraged to do so, in a note or notes attached to this report.
2. The definitions in, and provisions of, AASB 1026: Statement of Cash
Flows apply to this report except for the paragraphs of the Standard set out
below.
· 6.2 - reconciliation of cash flows arising from operating
activities to
operating profit or loss
· 9.2 - itemised disclosure relating to acquisitions
· 9.4 - itemised disclosure relating to disposals
· 12.1(a) - policy for classification of cash items
· 12.3 - disclosure of restrictions on use of cash
· 13.1 - comparative information
3. Accounting Standards. ASX will accept, for example, the use of
International Accounting Standards for foreign entities. If the standards
used do not address a topic, the Australian standard on that topic (if any)
must be complied with.
This information is provided by RNS
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