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YuuZoo plunges into the red with S$21.45m loss in Q4
ONLINE platform Yuuzoo posted a loss of S$21.45 million for the fourth quarter ended Dec 31, 2017, on the back of a 67 per cent fall in revenue to S$9.71 million for the same period.
The group chalked up the loss to significant impairments of assets available for sale. The impairments were in line with the significantly more conservative revenue recognition and accounting policies adopted in 2017, it added.
Tumbling revenue was attributed to reduced franchise and celebrity-branded network sales.
For the 12 months ended Dec 31, 2017, the group's profit fell by 84 per cent to S$2.29 million from S$14 million in the year-ago period, driven by impairments of assets available for sale and bad debts written off.
In its sectoral breakdown, Yuuzoo recorded a 93 per cent fall in e-commerce revenue to S$0.4 million in FY2017 from S$51.8 million in FY2016 due to the suspension of "certain payment related services" during the year.
Yuuzoo's formation of YuuLog, a joint venture (JV) company set up together with the former management of Cinram Logistics France, caused it to rack up significantly higher employee-related costs of S$5.9 million in Q4 2017, compared to S$1.4 million a year ago due to higher headcount.
As a result of the JV's formation, Yuuzoo's current liabilities also increased to S$12.3 million in Q4 2017 from S$4.7 million in Q4 2016 from the consolidation of trade and other payables from YuuLog.
It clocked loss per share of 0.03 Singapore cent in the fourth quarter, while net asset value sank to 12.06 Singapore cents.
Yuuzoo sounded a hopeful note in its outlook, saying that industry growth in social networking, e-commerce, online and mobile payments is expected to continue - areas which play to the company's strengths.
"YuuZoo believes its unique concept of growing internationally through a network of franchisees and partners, and its focus on developing unique disruptive new business models that can be patented will give the company a competitive edge over the next 12 months."
Its counter was up 2.08 per cent to close at 4.9 Singapore cents on Thursday, before its results were released.