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*Press Release
(For Immediate Release)*
*DC Holdings Announces FY2018 Interim Results*
Revenue and profit growth with multiple breakthroughs
in Big Data-enabled applications
(29 August, 2018, Hong Kong) *Digital China Holdings Limited* ("DC Holdings"
or the "Group"; Stock Codes: 00861.HK; 910861.TW) today announced its
interim results for the six months ended 30 June 2018 (the "Period").
During the first half of 2018, DC Holdings adheres to the mission and
prospects of "Digital China" and continues to transform itself from an
integrated Information Technology services provider to a Data Technology
services provider. Based on our extensive data resources and industrial
experience in the area of industry informatization, DC Holdings starts with
capital and technologies, relies on core capabilities such as Artificial
Intelligence Technology and Big Data, and achieves several breakthroughs in
key application scenarios of core industries such as Smart logistics, Sm@rt
city, Smart finance and Smart health.
*Financial Technology and Smart Logistics led to a substantial increase in
revenue while operating income and gross profit grew year-on-year*
For the first half of 2018, revenue amounted to approximately HK$6,986
million, representing an increase of HK$1,253 million, and a year-on-year
growth of 21.86% compared to the corresponding period of last financial year
(six months ended 30 June 2017). The increase in turnover was mainly driven
by the continued growth of financial IT services and Smart Logistics during
the period. Gross profit increased by 11.26% to HK$1,283 million compared to
last financial year, and the gross profit margin was 18.37%. During the
reporting period, the profit attributable to shareholders of the parent
company was approximately HK$137 million.
*Smart Logistics Business (Instant Technology Logistics) achieved remarkable
achievements: Enpowering logistic industry with "Warehouse+Big Data+AI
Technology" model*
As a leading supply chain management brand in China, the Group's Instant
Technology Logistics is practicing its core strategy of "Warehouse+Big
Data+AI Technology". Based on a network of 231 nationwide warehouse
facilities, and reliance on logistics management system of its own
intellectual property right and supply chain Big Data application platform
X-DATA, we can provide customized one-stop supply chain services for our
customers and hence the Company can enjoy a leading position in IT,
communication and e-commerce logistics industries.
During the reporting period, the Smart Logistics business continued to focus
on developing businesses with key customers in various sectors in order to
swiftly expand its market shares. For the first half of 2018, the Smart
Logistics business recorded overall turnover of HK$1,719 million, an
increase of 48.48% over the same period last year. The overall gross profit
margin was 14.69%.
Within this sector, the turnover of *e-commerce supply chain* business
continued to maintain a high growth rate of 41.55%, and gross profit
increased by 50.71%. The middle office support business of e-commerce supply
chain is highly recognized by customers, with its business operation
expanding rapidly. The turnover of the *logistics business* increased
significantly by 62% and the gross profit increased by 83.69% compared to
the corresponding period of last financial year. Both turnover and gross
profit have been significantly improved. In the B2B logistics segment, we
have deepened the cooperation with key corporate clients such as Xiaomi,
Schneider, China Mobile and Geely. In the B2C logistics segment, the
businesses coverage has been expanding from the brand flagship stores to
international businesses, as well as TMall businesses, and the order per day
increased by 206%. Logistics software has become a new source of profit for
the Smart Logistics business. Digital China Gold Storage logistics software
set, composed of WMS\TMS\OMS\BMS (warehousing, transportation, order and
accounting management), has comprehensive functions and complete proprietary
intellectual property rights.
As a leading brand in supply chain management, Instant Technology Logistics
has a comprehensive set of knowledge in managing and controlling
transportation resources, with an in-depth coverage in 3300 cities and
towns, 231 storage centers in China, and a warehouse portfolio with area of
over 1 million square meters. It is one of the few service providers in
China which can provide both B2B and B2C integrated services in warehousing
at the same time.
*Smart Logistics and Smart Warehouse based on "Human + Robot" business
model*
Instant Technology Logistics under DC Holdings has utilized AI Technology,
and further promoted and upgraded the automatic sorting system of our
self-developed business application model "Human + Robot". Being the first
"goods-to-person" logistic sorting model in China, it has passed the
elasticity test for the maximum order in the industry. The "Human + Robot"
business model has adopted a sorting method by smart robotic operations
together with a programmed manual work process, in order to satisfy the
demand in high-volume operating environment with zero tolerance to errors.
Under this new business model, about 40% of labor resources can be saved and
selection handling efficiency per staff has been increased by 2 to 3 times.
Several patents have been already applied.
With the technology upgrade, the application of"Human + Robot 2.0"has been
recently commenced in Pinggu warehouse, Beijing. Being the first 3D
high-density robotic Smart Warehouse in China, Instant Technology Logistics
has applied the AI-driven orbital robot technology, of which the robot can
operate at an elevated platform, as opposed to traditional robotic operation
on the ground. Being able to fully utilize all three dimensions in the
warehouse area is a very substantial breakthrough, leading to maximizing the
efficiency of the warehouse. This is the first 3D high-density robotic Smart
Warehouse in China, and has become the milestone in the history of smart
automation in e-commerce and logistics.
*X-DATA Smart Logistics Big Data platform empowers logistic industry*
X-DATA System is a Big Data application platform self-developed by Instant
Technology Logistics under DC Holdings based on its years of experiences. It
is used for collection, supervision and in-depth data mining in aspect of
procurement in supply chain, inventories, operation within warehouse,
transportation and after-sale services, and enjoys a leading position in
accumulation of Big Data in B2B logistic industry. Throughout the data
mining process, the precise analysis on customers has greatly improved the
service quality on upstream and downstream customers in the supply chain and
enhanced customer retention. In the future, the Company will actively
consider re-organizing the logistic Big Data operation as an independent
business in the commercial market and launch the cloud service based on
X-DATA. With the increasing number of users, continuous expansion in
logistic Big Data and extensive data dimension, it has provided highly
valued information resources and business foundation for application
scenarios such as industrial market analysis and financial risk control in
supply chain.
*Sm@rt City Business: Sm@rt City solution based on in-depth application of
city Big Data has been launched and executed nationwide in China*
Sm@rt City business has currently covered more than 100 million population,
and our Sm@rt City solutions have been operated in 116 cities and more than
50 provinces and municipals in China. After the issuance of Notice of the
General office of the State Council on Implementation Plan of Integration
and Sharing of Publication Government Information System, DC Holdings is
promoting the Sm@rt City 3.0 model based on in-depth application of city Big
Data and integration among city management and industries. Yanyun DaaS, our
proprietary deep-web data extraction technology could break down more than
5,000 government isolated information islands and has connected databases
previously stored in fragmented and regionalized formats, which greatly
promote the information sharing and exchange, as well as further integrate
the Big Data with all aspects of production to solve a series of issues such
as healthcare, transportation, energy supply, emergency rescue and social
security to support the economy. Yanyun DaaS has so far been the only
product which has won the Special Invention Award by the China Electronics
Society. It has been rated by professional experts as a "major disruptive
inventions and innovations" in the field of information system
interoperability technology.
During the reporting period, Sm@rt City 3.0 model has been applied
nationwide. Meanwhile, the construction of city Big Data platform has been
further promoted, including the city Big Data platform in Tongren city,
Guizhou Province, the construction of internet cluster area"New Smart CBD"in
Pazhou, Guangzhou, and smart water foundation system in Guangzhou, Big Data
platform project in Cangzhou, Hebei Province, the development of
comprehensive citizen service platform"eLongyan"in Longyan city, Fujian
Province, the launch of comprehensive citizen service platform"In Yantian"in
Yantian District, Shenzhen, and the launch of online comprehensive lease
service operation platform"C1YJ"in Guangzhou. These projects provide
practical benefits and effective support for local governments in government
affairs management and citizen services.
In April 2018, DC Holdings successfully acquired Wai On Services Limited
(hereinafter "Wai On"), an IT service provider with experiences in providing
solutions for large scale projects of the Hong Kong government and
multinational enterprises. It has provided a new impetus to promote Sm@rt
City in Hong Kong, Macau and "The Belt & Road" countries and achieved
resources integration and optimized distribution.
In June 2018, the Scity under DC Holdings served as a core member of
national standard setting body of Sm@rt City and participated in the
formation of:"GB/T 36333-2018 Sm@rt City Top-level Design Guideline"(GB/T
36333-2018 ??????????) and"Sm@rt City Domain Knowledge Model Core Concept
Model"(????????????????) (GB/T 36332-2018), which have been published by the
Standardization Administration of the PRC and will be officially implemented
on 1 January 2019. Those two standards have set the best practices for Sm@rt
City 3.0, and indicate that DC Holdings has become the standard setter and
leader of China's Sm@rt City top-level designs.
*Focus on financial technology sector as a key growth driver*
In the first half of 2018, based on its Big Data strategy, DCITS (IT
Services Business) continued to make progress in strategic businesses such
as Big Data, quantum communication, financial technology and smart
maintenance. During the reporting period, DCITS reported turnover of
HK$4,998 million, an increase of 20.09% over the same period last year. The
business gross profit margin reached 18.61%, a slight decrease of 0.15
percentage points compared with the same period of last year. The profit
attributable to shareholders of the parent company was HK$332 million, an
increase of HK$225 million compared with the previous year's HK$107 million.
*Business expansion by leveraging existing advantages in financial
technology*
During the reporting period, DCITS further expanded its key businesses, with
its software and services business growing rapidly. Its core software
products includes Core Banking System, Enterprise Service Bus, Internet
Solutions, Intelligent Bank Solutions, etc. During the period, the Company
has signed up four financial institutions such as the Export-Import Bank of
China and Ping An One Account Management Services for its core banking
system and distributed platform, with a market share of 50%. Three among
those financial institutions use the new generation of distributed system.
The Company has signed up nine customers such as ChinaBond and Industrial
Bank for its Enterprise Service Bus ("ESB"), which continues to maintain the
leading position in the market and becomes the sole player in state-owned
and joint-stock bank markets, serving more than 70 customers. Meanwhile, the
Company also promotes distributed ESB products such as Enterprise Service
Cloud ("ESC") in order to reinforce its leading position.
*Leading FinTech development by applying technology into practical
scenarios*
During the reporting period, Digital China Financial Cloud Service (???)
entered into strategic and capital partnership with JD Finance (????). Using
the financial cloud of the Company as a platform, we provide FinTech
services to small and medium banks, leveraging not only the advantages of
financial cloud in system building and operation services, but also the
leading position of JD Finance in risk management, internet business
platform and financial products, so as to assist small and medium banks to
kickstart their internet finance business. We also make use of this
opportunity to explore a new business model which connects our customers and
expands our platform, making the financial technology business enter into a
new stage, leveraging on the customers, application scenarios, data and
human resources accumulated by the Company in the financial industry over
the past 30 years, as well as combining the Company's data, industry
know-how and algorithm capability in agricultural, industrial, supply-chain,
taxation, and commercial sectors.
*Strategic Investment Business: Breakthrough in the applying Big Data
technology to health and manufacturing industry*
DC Health under DC Holdings and Phillips jointly promoted SHINEFLY (???) , a
leading cloud-based precision healthcare platform driven by computer-aided
diagnoses and AI Technology, it provides a safe and reliable big data
application platform with customized and extendable cloud solutions for
medical institutions. DC Health has provided 'Shenbeikang' (???) gene
sequencing analysis platform for molecular diagnostic center at Children's
Hospital of Fudan University. Leveraging the knowledge gained from the
research on children's rare diseases in the past decade, it can empower the
medical industry by combining the powerful Cloud computing capability and
medical Big Data.
During the reporting period, DC Health has already established cooperation
in respect of clinical applications with three national medical
institutions, including the Cancer Hospital, Chinese Academy of Medical
Sciences, Peking Union Medical College Hospital and Children's Hospital of
Fudan University and started research and information exchange with China
National Cancer Centre and National Cancer Registration and Analysis Service
in the United Kingdom in respect of jointly advancing the establishment of
oncology big data platform by China and the United Kingdom. DC Health
established in-depth cooperation with Congenica, a leading developer of
genome analytics, in respect of the effective and precise analysis of
clinical data and genome data. In the fourth session of Intel Life Science
Information Technology Forum, DC Health was awarded the "Best Application
Award", an endorsement to DC Health's track record in Precision Healthcare
based on Big Data technology.
During the reporting period, the service of iSESOL industrial internet
platform has covered 26 provinces and 161 cities, and has served over 3,000
corporate customers, connected more than 10,700 smart devices and with
accumulated service hours of over 3,400 thousand hours. In February 2018,
the iSESOL industrial internet platform passed the "First batch of
Industrial Internet Platform Reliable Service Assessment Certification" of
the Ministry of Industry and Information Technology, and became one of the
first five platforms providing reliable industrial internet cloud services,
being the only industrial internet platform among them that focuses on the
area of machining.
*Adherence to the mission of "Digital China" and empowering different
industries*
Mr. Guo Wei, the chairman and CEO of DC Holdings, said, "In the digital era
with Big Data Technology as the key element of success, DC Holdings, as a
leading Big Data technology service provider, will continue to adhere to
'Digital China' as our mission, and proactively prepare ourselves for
various core industries such as Sm@rt City, Smart Health, Smart Logistics,
Smart Manufacturing and Financial Technology relying on Big Data and
Artificial Intelligence (AI). We are seeking a type of ecosystem with high
level of crossover between technology and finance, city infrastructure,
culture and commerce, which helps realize the sustainable development of the
harmony between the industry and resident, enterprises and people. Looking
forward, DC Holdings will adhere to the original aspiration of 'Digital
China', strive to promote the opening up and integration of the industry,
empower the digitalization of corporations through Big Data and AI
technology. While we strive for continuous growth of our business result,
our profitability will further improve, enhancing the returns to our
shareholders."
*The End*
*About Digital China Holdings Limited*
Digital China Holdings Limited ("DC Holdings", Stock Code: 0861.HK) was
listed on the Main Board of The Stock Exchange of Hong Kong in 2001
following a successful spin-off from the then Legend Group in 2000. It has
developed its capital platforms across Mainland China, Hong Kong and Taiwan
through the following four listed companies- DC Holdings, Digital China
Information Technology Service Company Ltd., Digiwin Software Company Ltd.,
and HC International, Inc. Their combined market capitalization reaches
nearly HK$50 billion. Since its listing 16 years ago, DC Holdings has
adhered to the mission of driving the "Digitalizing China". With the
corporate value of "commitment, passion and innovation", the Company evolved
from China's largest integrated IT services provider into an innovative Big
Data technology service provider. According to its latest development
strategy, DC Holdings will capture the opportunities arising from the
"Artificial Intelligence (AI) + Big Data" strategy and leverage on its
technological strengths and capital resources to drive breakthroughs in core
industries, such as Smart Logistics, Sm@rt City, Smart Finance, Smart
Healthcare based on Big Data technology.
For additional information about DC Holdings, please visit the Group's
website at www.dcholdings.com.hk [1]
*For media inquiries:*
*Media Inquiries: *Investor Inquiries:
DC Holdings DC Holdings
Brand Marketing Department* Investors Relation Department*
Tel:010-8270-7951 Tel:852-3416 8085
Email:tangkk@dcholdings.com Email:ir@dcholdings.com;
irislian@dcholdings.com
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Document title: DC Holdings Announces FY2018 Interim Results Revenue and
profit growth with multiple breakthroughs in Big Data-enabled applications
31/08/2018 Dissemination of a Marketing Press Release, transmitted by EQS
Group.
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(END) Dow Jones Newswires
August 30, 2018 19:00 ET (23:00 GMT)
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