China Silver Group Net Profit Surges 89.1% to RMB248 Million Sets New Record for Full Year Net Profit
Launches Proprietary Online Sales Platform www.CSmall.com “金貓銀貓” Generates Revenue of RMB271 million in First Year
Aims to Become the Leading Silver Brand in the World
HONG KONG, 16 March 2015 – Leading Chinese silver brand China Silver Group Limited (“China Silver Group” or the “Group”; Stock Code: 815.HK) is pleased to announce its audited consolidated results for the year ended 31 Decemeber 2014. Upon entering the downstream silver retail business in the PRC, the Group has achieved record-breaking results in 2014.
During the year, the Group’s consolidated revenue increased slightly to RMB1,523 million (2013: RMB1,507 million) as the increase in revenue from the online segment was offset by the decrease in the average selling price of silver ingot due to the decline in the international silver price. The online business, which provides customers a greater variety of value-added products, enjoys a considerably higher gross profit margin. As a result, our consolidated gross profit margin saw significant improvement, rising from 14.7% in 2013 to 22.6% in 2014. The online business achieved a segment margin of 28.3%, significantly higher than the traditional manufacturing business. During the year, profit attributable to owners of the Company increased significantly by 89.1% to RMB248 million (2013: RMB131 million), representing record-breaking full-year net profit. The Board proposed a final dividend of HK$0.05 (2013: HK$0.03) per share. Together with the interim dividend of HK$0.02 (2013: HK$0.02) per share, total dividend for 2014 will be HK$0.07 (2013: HK$0.05).
During the year, the Group strived to enter the downstream silver retail business in the PRC, adopting an unconventional O2O (online to offline) business model, one that we call “Small Window, Big Platform; Little Inventory, Huge Market”, so as to better merge business with technology and accommodate the fast-changing retailing landscape in the PRC. The Group successfully launched its proprietary online sales platform (www.CSmall.com, “金貓銀貓”) and achieved aggregate online sales of RMB271 million, representing 17.8% of total revenue.
Our unconventional business model provides a unique O2O shopping experience to our customers and developed several initiatives based on the B2B and B2C business models. In our B2B business, we provide offline experience, service and support to our online business through a total of roughly 50 O2O experience outlets in the Yangtze River Delta. In May 2014, the Group launched its self-branded “China Silver investment silver bars” on the CCTV shopping channel and recorded staggering sales of over 100 units in the first hour. Currently, the Group is working with a total of seven TV shopping channels, offering wide coverage to TV audiences and shopaholics throughout China. Moreover, the Group’s flagship exhibition hall in Shuibei, Shenzhen, was officially opened in September 2014, serving as an all-in-one exhibition and experience centre supporting our online operation. Occupying 2,000 square meters, the flagship exhibition hall has introduced products that include gold, amber, gemstone, pearl, diamond, etc., and offers the most comprehensive range of jewellery products in Shenzhen and sets a new industry standard. Apart from supporting the online operation, the exhibition hall also provides comprehensive wholesale service to our customers. In September 2014, we launched a mass marketing campaign at the Shenzhen International Jewellery Fair (the largest jewellery exhibition in mainland China) and received an overwhelming response from participants.
In our B2C business, we launched an online sales platform, www.CSmall.com “金貓銀貓”, with the aim of building it into the most comprehensive and integrated sales platform for gold, silver and jewellery products in China. CSmall “金貓銀貓” now features more than 60 self-owned and third party jewellery brands. On 11 November
2014, also known as the Single’s Day Festival, CSmall “金貓銀貓” achieved record sales of approximately RMB6 million in one day. Furthermore, the Group also worked with popular third party platforms such as Tmall and JD to distribute its branded products and recorded healthy sales growth. In late 2014, the Group launched the CSmall mobile app to meet the shift in customers’ shopping habits in a timely manner.
Looking ahead, the Group is very confident about the future of the silver market in China. While the Group continues to add more influential TV channels as partners, it is also exploring opportunities to promote different types of its silver products to the massive TV audience in the PRC. The Group will continue to expand its O2O outlets throughout China. To date, the Group has already signed agreements with 11 regional distributors in different provinces and expects to open 300 outlets in 2015. The Group will continue to bring in more quality third party jewellery brands to www.CSmall.com “金貓銀貓” and upgrade the unique O2O shopping experience the Group offers to its customers.
Mr. Chen Wantian, Chairman and Chief Executive Officer of China Silver Group, said, “The year 2014 was a milestone for the Group. We are happy to see numerous positive signs in our development. The successful launch of www.CSmall.com “金貓銀貓”has brought different opportunities to the Group in the downstream business. Stepping into 2015, we will strategically allocate more resources to develop our fast-growing online business and continue to utilize our proprietary online platform together with our offline establishments so as to provide a unique O2O shopping experience to our customers. We will look at suitable acquisition opportunities in the market. The Group will step up its efforts to build itself into the leading integrated e-commerce platform of gold, silver and jewellery products in the PRC, and will head the right direction at full speed to become one of the leading silver brands in the world.
China Silver Group Limited
China Silver Group is a leading silver producer in China and was one of the top ten largest silver producers in China. It is one of the few silver manufacturers in China capable of producing silver ingots with a purity grade of 99.999%, currently the world’s highest standard. The Group’s “Longtianyong” branded silver ingots are accepted by the LBMA Good Delivery List. Domestically, “Longtianyong” silver ingots have been ranked by the Shanghai White Platinum & Silver Exchange as one of 20 most popular silver brands for nine consecutive years since 2005. In 2014, the Group diversified into the downstream silver retailing business and launched an integrated e-commerce platform “金貓銀貓www.CSmall.com”.
To learn more about the Group, please visit China Silver Group’s website at: http://www.chinasilver.hk/
For further enquiries, please contact Hill+Knowlton Strategies:
Ka Wai Li
Tel: (852) 2894 6252
Tel: (852) 2894 6260
next：Revenue from O2O Segment Significantly Increased by 245% to RMB214 Million Recorded Interim Net Profit of RMB13.7 Million