Release Date: May 15, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Treasure Global Inc successfully launched the ZCITY Premium Store, significantly boosting gross profit margins and aligning with strategic visions.
- The company secured a strategic partnership to become the exclusive provider of an AI blockchain wallet on Telegram, enhancing its competitive position in the blockchain market.
- Treasure Global Inc's focus on AI and innovation has led to the development of a state-of-the-art data center dedicated to AI applications, positioning the company as a key player in the Southeast Asian digital economy.
- Achieved a substantial increase in gross profit by 47% compared to the same period last year, demonstrating effective cost management and high-margin business strategies.
- Treasure Global Inc won the silver trophy at the MARKETING-INTERACTIVE Asia eCommerce Awards 2023 for best e-commerce solution, highlighting its excellence in the online shopping sector.
Negative Points
- Despite strategic initiatives, total revenue for the quarter saw a significant decrease of approximately 76% from the previous quarter, reflecting a shift towards higher margin but lower volume business streams.
- The company experienced a decline in quarterly active users and paying users compared to previous quarters, indicating potential challenges in user engagement and retention.
- Treasure Global Inc reported a reduced cash balance of approximately USD0.3 million as of March 31, 2024, down from USD4.1 million the previous year, raising concerns about short-term liquidity.
- The strategic shift away from lower margin offerings like e-vouchers, despite its short-term impact on results, indicates a period of transition and potential instability.
- The company's reliance on strategic partnerships and new market initiatives to drive future growth may introduce risks associated with dependency on external entities and market acceptance.
Q & A Highlights
Q: Can you elaborate on the impact of the new ZCITY Premium Store on your financials?
A: Chong Chan Teo, CEO - The ZCITY Premium Store has significantly boosted our gross profit margin. Since its inception, it has sold over 6,000 Bills Saver Bonanza Packs, surpassing our sales expectations and enhancing user engagement, which in turn has contributed notably to our gross profit growth.
Q: How has the ATM offering influenced your financial strategy?
A: Chong Chan Teo, CEO - The ATM offering allowed us to raise up to USD2.99 million, providing us with essential capital while maintaining flexibility. This aligns with our growth strategy and supports our business initiatives, fostering innovation and creating more value for our shareholders.
Q: What are the key developments in your AI and blockchain initiatives?
A: Chong Chan Teo, CEO - We've made significant strides in AI, enhancing product offerings and customer connections. Our exclusive partnership as the AI blockchain wallet provider on Telegram has positioned us at the forefront of blockchain innovation, securing a competitive edge and unlocking new business opportunities.
Q: Could you discuss the financial outcomes for Q3 2024 in more detail?
A: Chong Chan Teo, CEO - For Q3 2024, our gross profit reached USD217,000, a 47% increase year-over-year. Despite a revenue decrease to USD1.6 million from USD6.7 million in the previous quarter, our net loss decreased significantly to USD1.7 million from USD2.9 million, reflecting effective cost management and a strategic shift towards higher margin businesses.
Q: What strategic moves are you making in response to current market conditions?
A: Chong Chan Teo, CEO - We are reallocating resources from lower-margin offerings, like e-vouchers, to high-margin solutions. This strategic shift is essential for enhancing our working capital and reducing dependency on lower-margin offerings, positioning us for more profitable growth.
Q: How does the partnership with Satria Dunia Sdn Bhd fit into your growth strategy?
A: Chong Chan Teo, CEO - The USD2 million marketing contract with Satria Dunia Sdn Bhd to showcase premium Korean products using ZCITY as an AI marketing engine is a significant step in expanding our influence and capabilities in the beauty sector, creating a new revenue stream and increasing brand exposure.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
