Our reporter LV Dong
On the evening of August 29th, 2021,China Digital Holdings Co., Ltd.(hereinafter referred to as: China Holdings) publishes operating results for the six months ended June 30, 2021 ("period"). In the first half of 2021, China Holdings accelerated the strategic transformation of big data. In order to achieve sustained high-quality development, the company took the initiative to optimize its low-margin business, focused on key industries, scenarios and customers, and vigorously developed big data's software business. although the income scale has been affected to a certain extent, the gross profit margin and big data income have increased significantly, and the transformation has achieved initial results.
In the first half of this year, China Holdings achieved operating income of 8.673 billion Hong Kong dollars, a five-year high; business profit of 305 million Hong Kong dollars (excluding net profit and loss on the sale of the interests of a number of associated companies), an increase of 601 percent over the same period last year; big data's business income reached 155 million Hong Kong dollars, an increase of 185 percent over the same period last year. It is worth mentioning that big data's income in 2020 also increased by 124.5% compared with 2019, and big data's income continuously achieved triple-digit explosive growth.
The management of China Holdings said that in the initial stage of business transformation, the company focused on and deeply cultivated valuable strategic key customers to improve the retention rate of high gross margin customers. The company took the initiative to optimize its low gross margin business, which put pressure on revenue, but the gross profit margin increased to 16.6% from 11.5% in the same period last year. Gross margin also rose 20.0 per cent year-on-year to HK $431 million, while segment performance rose strongly to HK $131 million from HK $78 million in the previous fiscal year.
During the reporting period, core customers accounted for the majority of the current optimized supply chain business customers, accounting for more than 70% of revenue. Since 2018, software-related revenue from key customer groups has grown rapidly at a compound growth rate of 66%, indicating the success of China Holdings's cross-selling strategy among key customer groups.
Due to the increasing use of the company's software products by customers, big data-related income of big data scene business in China holding industry increased significantly during the reporting period, up 312% from the previous fiscal year. With the continuous deployment of the company's software and related services, management is expected to drive the continuous optimization of China Holdings's overall supply chain business and achieve sustained growth in revenue and gross profit margin.
(editor Cui Man)