Gangwan Business Watch, Huang Yi
On August 25, Tianju Dihe (Suzhou) Technology Co., Ltd. (hereinafter referred to as "Aggregate Data") submitted a prospectus to the Hong Kong Stock Exchange, with CITIC Securities as the sole sponsor, intending to be listed on the main board of Hong Kong.
It is reported that the customers of aggregated data include well-known enterprises such as Tencent, Alibaba, Baidu, Netease, Meituan, China Mobile, China Unicom, China Telecom, as well as many other Internet companies, application developers and individual users. In addition, in 2014, JD Technology became the second largest shareholder of Aggregate Data in the Series A financing stage.
As early as December 7, 2018, the aggregated data was submitted to the Shenzhen Stock Exchange and failed to be listed.
01
The increase in income did not increase the profit significantly, and the net interest rate continued to fall
Aggregated Data is a comprehensive API (Application Programming Interface) data circulation service provider. Through the company's products, it provides solutions that integrate API management, data governance, data application, data security, and privacy-preserving computing to assist organizations in digital transformation. In addition, the company provides customized, digital, and locally deployed data governance solutions that meet the diverse needs of customers in government agencies, utilities, manufacturing, finance, telecommunications, and other industries.
From 2020 to 2022 and March 31, 2023 (the reporting period), the revenue from aggregated data was 178 million, 260 million, 329 million and 95.614 million, respectively; gross profit was 56.948 million, 89.912 million, 108 million and 20.531 million, respectively; Profit before tax was 31.165 million, 53.429 million, 44.756 million and 10.876 million, respectively; The net profit was 27.223 million, 45.966 million, 41.284 million and 9.788 million, respectively; The gross profit margin was 31.9%, 34.6%, 32.7% and 21.5% respectively; Net profit margins were 15.3%, 17.7%, 12.6% and 10.2%, respectively.
In terms of financial data, taking 2022 as an example, Ju Data has fallen into the dilemma of increasing revenue without increasing profits, in addition, the net interest rate has also plummeted in the past three years.
It is reported that the revenue of aggregated data mainly comes from the API market, including inquiries, SMS notifications and recharge services, and data governance solutions. Among them, during the reporting period, the revenue of the API market was 164 million, 195 million, 224 million and 82.039 million, respectively; accounted for 91.9%, 74.9%, 68.0% and 85.8% of the company's total revenue, respectively; Its gross profit margin was 32.9%, 31.2%, 32.0% and 18.9%. The revenue of data governance solutions was 14.446 million, 65.291 million, 105 million, and 13.575 million, respectively, and its gross profit margin was 21.2%, 44.6%, 34.2%, and 37.1%.
According to the prospectus, revenue from the API market as of March 31, 2023 showed a year-on-year growth trend, due to a significant increase in revenue from enquiry and SMS notification services.
In addition, the aggregated data explains that API market gross margins in the first quarter or first half of the year are generally lower than full-year gross margins because companies typically receive significant discounts from data service providers (depending on the total purchase amount of data services) that are used to offset the company's procurement costs in the fourth quarter, as the company's data services procurement costs gradually increase during the year.
During the reporting period, the cost of sales of aggregated data was 121 million, 170 million, 221 million, and 75.083 million, respectively; Sales and distribution expenses were 14.594 million, 15.449 million, 14.378 million and 3.753 million, respectively. In addition, the procurement cost of APIs was 106 million, 130 million, 149 million, and 65.611 million, respectively; The procurement cost of data governance solutions was 10.130 million, 30.222 million, 59.046 million, and 7.730 million, respectively.
The purchase of aggregated data includes the purchase of data services, software, hardware, and technical services. During the reporting period, the company's procurement amount was RMB116 million, RMB161 million, RMB208 million and RMB73.3 million, accounting for 95.7%, 94.4%, 94.0% and 97.7% of the total cost of sales respectively.
According to the prospectus, during the reporting period, the company's total procurement of the five major suppliers accounted for 68.7%, 56.2%, 69.9% and 89.1% of the total procurement respectively, while the purchase amount from the company's largest suppliers accounted for 25.2%, 37.4%, 37.5% and 60.4% of the total cost of sales.
Zhang Xuefeng, a financial commentator, pointed out to Harbor Business Watch that "the dependence of aggregated data on suppliers is relatively concentrated. High dependence may expose companies to some risks in procurement, such as supplier price increases, supply interruptions, etc., so companies should carefully manage supply chain risks and find alternative suppliers to ensure business sustainability. ”
02
Customer and supplier dependence, accounts receivable rising year by year
According to the prospectus, customers who aggregate data include internet companies, telecom operators, technology companies and other enterprises and government organizations seeking digital transformation, as well as individual application developers and technology professionals.
During the reporting period, revenue from the top five customers accounted for 38.7%, 41.1%, 43.7% and 79.2% of the total revenue, while revenue from the largest customers accounted for 11.6%, 11.7%, 12.4% and 44.3% of the total revenue, respectively.
In addition, during the reporting period, the trade receivables, margins and other receivables and contract assets of the largest customers with aggregated data were 27.8%, 15.9%, 19.3% and 33.7%, respectively, and the cumulative cumulative value of the top five customers was 71.7%, 38.2%, 40.5% and 64.3%, respectively.
During the reporting period, the net trade receivables aggregated data were 63.087 million, 91.203 million, 124 million and 153 million, respectively; The total trade receivables were 66.720 million, 95.273 million, 130 million and 158 million, respectively; The number of days (days) of trade receivables turnover is 86, 114, 125 and 136. Among them, the trade receivables of the API market were 59.869 million, 55.753 million, 82.039 million and 114 million, respectively; The trade receivables of data governance solutions were 6.851 million, 39.520 million, 47.779 million, and 43.947 million, respectively.
It is reported that customers who aggregate data can be divided into customers who pay the Company before ("prepaid") or after ("postpaid") the provision of services. Trade receivables tend to be higher when a large number of customers pay only after the provision of services, as their payment obligations are recorded as trade receivables. Most of the company's data governance solution customers and large API marketplace customers, including government agencies and large Internet companies, are postpaid customers.
The aggregated data disclosed in the prospectus that the company has experienced a concentration of customers and suppliers, and three of the top five suppliers are the company's customers. As of March 31 this year, customer H (supplier A) accounted for 62.7% of the total procurement and transaction amount of 45.335 million; customer B (supplier F) accounted for 12.2% of the total procurement amount, with a transaction amount of 8.856 million, and customer K (supplier J) had a total purchase value of 3.2% and a transaction amount of 2.3 million.
Zhang Xuefeng believes that "there are certain risks in the company regarding the concentration of customers and suppliers. Especially if the company's customers or suppliers are concentrated in a small group, it means that the company is very dependent on the business of those customers or suppliers. If one of the customers or suppliers has a problem, such as going out of business, going bankrupt, etc., the company may be greatly affected. Therefore, companies should strive to expand the diversity of customers and suppliers, find new customers and suppliers, reduce dependence and reduce risks. ”
Zhang Xuefeng believes that "the total increase in trade receivables year by year may be due to the expansion of the company's sales scale and the increase in the number of customers and business volume. This can be seen as a positive sign of the company's business growth. However, increasing trade receivables turnover days over year can mean slower recovery of receivables for companies. This may lead to inflexible capital turnover and bring certain pressure to operations. In this case, the company should consider measures to expedite the recovery of receivables, such as improving credit management policies, increasing collection efficiency, etc. ”
During the reporting period, the net cash flow from operating activities of aggregated data was 131 million, -33.796 million, -36.819 million and 7.594 million, respectively.
Shen Meng, executive director of Chanson Capital, told Harbor Business Watch, "Aggregated data is overly dependent on a few suppliers, which is not conducive to the operational independence of enterprises, and profits are more easily affected by third parties." At the same time, the concentration of suppliers and customers is not conducive to the independence of enterprise operations, and will also affect investors' expectations for stable growth of its performance. In addition, the increase in receivables and the increase in turnover days mean that the liquidity of enterprises becomes lower and their sales collection capacity is weaker, which may cause daily working capital constraints, among which the fluctuation of net cash flow from operating income is greatly related to the weak foundation of its sales collection capacity. ”
Regarding the fluctuation of net cash flow from aggregated data operating activities during the reporting period, Zhang Xuefeng added, "The instability of net cash flow from operating activities may be caused by a variety of factors, such as fluctuations in sales and unstable cost control. This situation may create uncertainty for the company's operations. Companies should focus on cash flow management, strengthen budget and cost control, and maintain good cash liquidity. In addition, the company can explore diversified revenue sources and reduce over-reliance on a customer or a business to balance cash flow from operating activities. (Produced by Harbor Finance)