Interviews
VLOV brand delivers double-digit revenue growth
21 Apr '10
5 min read
Net income attributable to common shareholders in 2009 came in at $6.4 million, or $0.40 per diluted share compared to $9.2 million, or $0.63 per diluted share in 2008. Net income was $10.4 million in 2009, representing year-over-year growth of 14%(1). Adjusted diluted earnings per share (non-GAAP) came in at $0.65 on an additional 1.8 million shares outstanding(1). The increase in share count from 14.6 million in 2008 to 16.4 million in 2009 reflects the issuance of preferred and common shares and common stock purchase warrants in the fourth quarter of 2009.
At December 31, 2009, the Company was in strong financial condition with $11.0 million in cash and cash equivalents, $16.8 million in working capital and no long-term debt. Cash flow from operations in 2009 totaled $5.7 million.
Mr. Wu continued, "We completed a $10.0 million capital raise in the fourth quarter of 2009, which provides us with the financial flexibility to pursue our growth strategies. Our plans for 2010 include both brand and store level initiatives. We will be refurbishing selected shop-in-shops and free-standing locations as we introduce a new generation of stores that more effectively conveys our contemporary, chic and stylish brand positioning. We will also be increasing the breadth and depth of our product offerings to better meet the needs of our target customer. Importantly, the brand will be supported by targeted marketing programs and new imagery designed to communicate our enhanced lifestyle positioning and appeal to VLOV's 15-34 year old demographic. In 2010, we expect to increase our marketing spend to approximately 8 to 10 percent of total revenue, which compares to 5 percent in 2009.
"We believe these actions will enable us to build increased awareness and excitement around the VLOV brand, while at the same time allowing us to extend our reach to new geographic regions and consumers throughout China. This year we expect to expand into additional provinces, primarily through shops in high-end department stores, as well as flagship VLOV stores. Looking further ahead, we plan to leverage VLOV's strong brand recognition to develop a presence in more densely populated, higher income Tier I cities."
Mr. Wu concluded, "Our target demographic accounts for the greatest wealth creation in China today. VLOV's customers are fashion-conscious men, who seek sophisticated, stylish and chic brands. As we continue to execute on our strategic and operational initiatives, we believe our efforts will strengthen our competitive position, enabling VLOV to capture an increasing share of the market over the long-term. We're in strong financial condition and the business continues to generate solid cash flow, affording us the flexibility to pursue our growth plans and create shareholder value."
At December 31, 2009, the Company was in strong financial condition with $11.0 million in cash and cash equivalents, $16.8 million in working capital and no long-term debt. Cash flow from operations in 2009 totaled $5.7 million.
Mr. Wu continued, "We completed a $10.0 million capital raise in the fourth quarter of 2009, which provides us with the financial flexibility to pursue our growth strategies. Our plans for 2010 include both brand and store level initiatives. We will be refurbishing selected shop-in-shops and free-standing locations as we introduce a new generation of stores that more effectively conveys our contemporary, chic and stylish brand positioning. We will also be increasing the breadth and depth of our product offerings to better meet the needs of our target customer. Importantly, the brand will be supported by targeted marketing programs and new imagery designed to communicate our enhanced lifestyle positioning and appeal to VLOV's 15-34 year old demographic. In 2010, we expect to increase our marketing spend to approximately 8 to 10 percent of total revenue, which compares to 5 percent in 2009.
"We believe these actions will enable us to build increased awareness and excitement around the VLOV brand, while at the same time allowing us to extend our reach to new geographic regions and consumers throughout China. This year we expect to expand into additional provinces, primarily through shops in high-end department stores, as well as flagship VLOV stores. Looking further ahead, we plan to leverage VLOV's strong brand recognition to develop a presence in more densely populated, higher income Tier I cities."
Mr. Wu concluded, "Our target demographic accounts for the greatest wealth creation in China today. VLOV's customers are fashion-conscious men, who seek sophisticated, stylish and chic brands. As we continue to execute on our strategic and operational initiatives, we believe our efforts will strengthen our competitive position, enabling VLOV to capture an increasing share of the market over the long-term. We're in strong financial condition and the business continues to generate solid cash flow, affording us the flexibility to pursue our growth plans and create shareholder value."
VLOV Inc
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