Kingdee International Software Group Co., Ltd. · HKEX:268
Kingdee International Software — Investor Presentation (2005)
40 slides from Kingdee International Software's investor presentation, 2005
Slide 1: To be the Market Leading Provider in SME ERP Market in Asia Pacific Region
To be the Market Leading Provider in SME ERP Market in Asia Pacific Region Kingdee International Software Group Company Limited
Slide 2: Agenda
Agenda Industry Overview About Kingdee International Financial Performance Future Prospects
Slide 3: Industry Overview
Industry Overview K, in dee Kingdee International Software Group Company Limited g ZRaAMKAEA A ROA A
Slide 4: Packaged Software Components
Packaged Software Components Source：IDC, August 2004
Slide 5: Packaged Software Components
Packaged Software Components Source：IDC, August 2004
Slide 6: Significance of SME in China
Significance of SME in China As at 12/31/2004: 99.6% of total number of enterprises 58.5% of GDP 68.3% of exports 48.2% of tax revenue 75% of job opportunities Ou Xinqian, Vice Chairman of National Development and Reform Commission
Slide 7: Packaged Software Market Speedy Developed in the PRC
Packaged Software Market Speedy Developed in the PRC Number of customers increases rapidly： There were over 10,000,000 small and medium sized enterprises in Mainland China and the number is increasing substantially Penetration rate of informatization is about 5%
Slide 8: About Kingdee International
About Kingdee International
Slide 9: About Kingdee International
About Kingdee International No. 1 market share in SME enterprise management software market More than 40 branches and subsidiaries Over1,000 cooperation partners Over 200,000 customers Leading software developer in the PRC GEM：8133 Mainboard：268 Over 3,000 staffs，including 600 R&D engineers Focus on
Slide 10: Product Strategy
Product Strategy Kingdee Market Segments Kingdee ‘s Products EAS Large scale enterprises High （Finance, End Small-to-medium Mid-to-high end EAS, K/3 enterprises Mid-to-low end K/3, EAS Low end KIS Professional KIS Standard Entry Level KIS Simplified
Slide 11: Path to Success
Path to Success Announced the Kingdee’ Kingdee’s listing status will strategy of “Product change from GEM to Main Being the 1st Board on 20 July 2005 Leadership, Partner Independent software Oriented” and vendor (ISV) listed on launched new Launched new logo of the GEM of HKSE on generation ERP -EAS
Slide 12: Competitive Advantages
Competitive Advantages Compared with local vendors Compared with overseas vendors Product and technologies Strong foothold in SME market Unique middleware and BOS Over 200,000 customers, Product differentiation understand the needs of SME on management and informatisation Partnership strate
Slide 13: Awards
Awards First-choice brand for Enterprise Resource Management Product -《IDC China ERM market analysis report》 No. 1 market share in SME ERP market - CCW No.1 in brand loyalty of ERP product - Survey of Customer Satisfaction in the PRC’s IT industry Middleware reached international advanced le
Slide 14: Growing with Customers
Growing with Customers Over 2 million people using Kingdee software daily Over 10 million products delivered through Kingdee software daily Over 200,000 enterprises and non-profit making organisations using Kingdee software daily Over RMB 50 billion capital flow through Kingdee software dail
Slide 15: Strong Customer Base
Strong Customer Base Kingdee - No.1 in SMB Management Software Market in terms of market share - IDC, April 2004 “China ERM Product Market Analysis Report” 200,000 customers in various industries, of which some are outstanding clients in different industries Electronics, Mechanical, Pharmaceuticals,
Slide 16: Leader in Large Enterprises' Accounting and HR Systems
Leader in Large Enterprises’ Accounting and HR Systems China Merchants Group Centralised Accounting Management (standadised category, standadised Group worksheet, standadised delegated responsible person） Accounting Controlling rights of Consolidating worksheets changed from subsidiaries to the
Slide 17: Expansion in Asia Pacific Market
Expansion in Asia Pacific Market Leahander Group
Slide 18: Customers' Appraisal
Customers’ Appraisal Mr. Li Dongsheng, President of Mr. Chen Yuxin, Chairman and TCL Group General Manager of Huxi Hope Group Kingdee really did a good job when you review Kingdee’s history and “Hope” to have aggressive, steady and accreditations high speed growth under the national 回顧金蝶所走過的道路和取得的榮
Slide 19: Partners
Partners Pearl Club Services partners Training partners Kingdee’s partners ecochain Implementation Distribution partners partners Technical partners Advisory partners Consultants Over 1,000 channel sale partners, covering 221 cities in the PRC and successfully exploring Asia Pacific region Strat
Slide 20: Financial Performance
Financial Performance K, in dee Kingdee International Software Group Company Limited g ZRaAMKAEA A ROA A
Slide 21: Past Financial Results
Past Financial Results 500,000 During the past RMB’000 5 years, 500,000 445,922 445,922 turnover grew steady 400,000 400,000 from 2000 to 2004: 365,573 365,573 300,000 300,000 294,532 294,532 Turnover grew to 2.7x 200,000 200,000 187,742 187,742 Net profit grew to 2.5x 164,827 164,827 100,000 10
Slide 22: Past Financial Results
Past Financial Results 2002 2003 2004 Total Assets (RMB million) 313 372 472 Net Assets (RMB million) 210 261 314 Net Cash (RMB million) 105 144 191 Operating Cashflow (RMB million) 39 106 117 Current Ratio (times) 2.0 2.2 2.1 Debt/Total asset (%) 8.9% 5.4% 5.1% AR Turnover days (days) 81 62 73 Divi
Slide 23: Past Financial Results
Past Financial Results Turnover RMB ‘000 The Group is now in a fast growing stage 365,573 445,922 Investment for future Increased investment in R&D 2003 2004 of high-end product Net Profit Increased investment in RMB ‘000 building up brand 59,130 54,965 2003 2004
Slide 24: 2005 1H Results
2005 IH Results K, in dee Kingdee International Software Group Company Limited g ZRaAMKAEA A ROA A
Slide 25: Results Overview
Results Overview 2005 1H 2004 1H Variance % Turnover (RMB’000) 244,560 204,664 19.5 Gross Profit (RMB’000) 197,197 160,606 22.8 Profit (RMB’000) 23,084 17,628 31.0 Profit Attributable to 23,217 17,632 31.7 Equity Holders (RMB’000) Basic Earnings per Share (RMB cent) 5.238 3.991 31.2
Slide 26: Results Overview
Results Overview 2005 1H 2004 1H Variance % Gross Profit Margin (%) 80.6 78.5 2.1 Net Profit Margin (%) 9.4 8.6 0.8 Cost of Sales (RMB’000) 47,363 44,058 7.5 Selling Expenses (RMB’000) 121,679 103,654 17.4 General & Admin. Expenses 73,042 62,089 17.6 (RMB’000) Selling Exp./ Turnover (%) 49.8 50.6 0.
Slide 27: Results Overview
Results Overview 2005 1H 2004 Variance % Net Cash (RMB’000) 178,492 191,719 6.9 Current Ratio (times) 2.1 2.1 - Debt/Total Asset (%) 6.4 5.1 1.3 Account Receivables (RMB’000) 77,078 68,210 13.0 2005 1H 2004.1H Variance % Operating Cash Inflow (RMB’000) 36,464 13,974 160.9
Slide 28: Breakdown Analysis
Breakdown Analysis K, in dee Kingdee International Software Group Company Limited g ZRaAMKAEA A ROA A
Slide 29: Turnover
Turnover Turnover Turnover increased 19.5% from RMB ‘000 RMB 204,664,000 for 2004 1H to 250,000 19.5% RMB244,560,000 for 2005 1H 200,000 Sales of software and service 150,000 income increased 20% and 100,000 11.8% respectively 244,560 204,664 50,000 0 2004 1H 2005 1H
Slide 30: Turnover
Turnover Turnover Breakdown Sales of Software (81% of turnover, increased 20.1%) RMB ‘000 KIS (12% of turnover)— 2,658 250,000 Sales from KIS increased 7.6% to 539 44,234 RMB29,468,000 200,000 39,572 K/3 (60% of turnover)— 150,000 Sales from K/3 increased 20.2% to RMB146,472,000 100,000 197,66
Slide 31: Turnover
Turnover Turnover Breakdown Service Income (18% of turnover, increased 11.8%) Service income increased 11.8% to RMB ‘000 approximately RMB44,234,000 2,658 250,000 539 44,234 The Group enlarged service income by 200,000 39,572 standardizing service products 150,000 refining service manageme
Slide 32: Cost of Sales and GP Margin
Cost of Sales and GP Margin Breakdown of Cost of Sales Cost of Sales increased 7.5%. 2005 1H 2004 1H Variance (RMB’000) (RMB’000) % Increase of direct materials purchased from third parties on behalf of Direct 7,062 5,520 27.9% customers materials Increase of staff cost for implementation serv
Slide 33: 2005 1H Results - Summary
2005 1H Results - Summary RMB ‘000 Profit 31% 20,000 Profit increased 31.0% due to 10,000 23,084 With an increase of both sales 17,628 of software and service income, turnover increased 0 2004 1H 19.5% 2005 1H As a result of less expenditure RMB cent EPS-basic on advertising and better 6 contr
Slide 34: Future Prospects
Future Prospects K, in dee Kingdee International Software Group Company Limited g ZRaAMKAEA A ROA A
Slide 35: Strategy - Product Innovation
Strategy - Product Innovation New product versions KIS - adopt more powerful database and internet technology K/3 - upgrade in functions, usability and performance EAS – based on Java which is cross platform, provide tools and methods to measure and improve business performance and organizat
Slide 36: Strategy - Distribution-Centered Model
Strategy - Distribution-Centered Model Services Services 26% 35% Direct sales Distribution 25% sales 22% Direct sales 52% Distribution sales 40% Increase income from distribution sales Increase the number of sales agency and distributors from currently 1,000 to 2,000 Implement franchising system
Slide 37: Strategy - Prompter and More Efficient Service
Strategy - Prompter and More Efficient Service Services Services 26% 35% Distribution Direct sales sales 22% 25% Direct sales 52% Distribution sales 40% Increase income proportion from services Increase service partners Increase service charges Expand the scope of chargeable services Increas
Slide 38: Revenue Trend
Revenue Trend % of Total Revenue 52% 40% Distribution sales 35% Services 26% 25% Direct sales 22% 2004 2010
Slide 39: Thank you!
Thank you! K, in dee Kingdee International Software Group Company Limited g ZRaAMKAEA A ROA A
Slide 40: Investor Relations
Investor Relations Barry Ho General Manager Corporate Finance & Investor Relations 852 2155 3721 barryho@kingdee.com.hk Tony Zhu 86 (755) 2661 2299 ext. 6112 sighjian@kingdee.com Alice Zhang 86 (755) 2661 2299 ext. 6113 alice_zhang@kingdee.com
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