eCargo Delivers Group-First Net Profit in 2021

• Net Profit of HK$0.9 million [A$0.2 million] (FY20: HK$39.5 million loss);

• EBITDA of HK$9.2 million [A$1.6 million], up 21% year-on-year;

• Gross Profit of HK$89 million, up 28% year-on-year; Gross Profit Margin improvement of 25pp;

• Operational expenses down 20%; Cash-profitability across all Group business lines for first time since IPO;

• Revenue of HK$156.6 million [A$27.7 million]; focus on high margin products, removal of unprofitable businesses leaves group in strong position.

Asia sales accelerator eCargo Holdings Limited (ASX:ECG) (“eCargo”; “the Group”) today announced financial results for the year ending 31 December 2021 (FY21), delivering the Group’s first net profit since IPO, underpinned by a renewed focus on technology and higher margin products.

The results were primarily driven by new revenue streams resulting from early success of eCargo’s new technology-centric strategy, streamlining of key business centres, and continued implementation of operational efficiencies, resulting in cash-profitability across all key business lines.

The Group also achieved a 21% increase in EBITDA to HK$9.2 million [A$1.6 million] (FY20: HK$7.6 million), despite revenue falling by 28% to HK$156.6 million [A$27.7 million], as continued restructuring led to the removal of revenue-generating but unprofitable products, leaving eCargo more focused and well-positioned to grow.

The FY21 statutory net profit of HK$0.9 million [A$0.2 million] (FY20: net loss of HK$39.5 million) represented an important step forward for the business and demonstrates the success of the restructure under CEO Lawrence Lun’s leadership.

Executive Chairman John Lau commented: “I am very proud of the achievements the business has made since Lawrence Lun’s appointment in 2020, starting with the group-first EBITDA profit in 2020, and continuing with the first net profit in 2021. eCargo is more efficient and focused, with exciting new initiatives that leave the business in an excellent position to grow”.

CEO Lawrence Lun commented: “Since 2020, eCargo’s key objective has been attaining profitability across the business. With the team’s support and new strategy around leveraging technologies to digitalise the supply chain, I’m happy to announce the delivery of our first net profit. This is a testament to the positive impact of our restructure, success of the new technology-enablement business and strength in foundational eCommerce and distribution functions. We built out our new technology-centric strategy with the launches of JuJiaXuan and PJF Wines, which have showcased early promise and will support further growth”.

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Lewis Bacon [e-mail]