pchome presentation
TRANSCRIPT
PChome OnlineTaiwan Leading E-commerce Group
Taiwan SMid Cap Corporate Access Day
Feb 2.17 -18
Singapore/ Hong Kong
PChome Group Company Overview
• Established: July 1998• Public listing: Jan 2005(stock symbol:8044-TT)
• Capital:583 Mn TWD(18.2Mn USD) • Main business: e-commerce• HQ location: Taipei, Taiwan• Employee:496 (Group:730)• Business location: Primary Taiwan• Founder:
Company Profile
Hung Tze Jan
Chairman
Arthur Lee
CEO
Company milestoneHistory
• 1998.07Established,Chairman H.T Jan,CEO Arthur Lee, provided portal services.
• 2004.07Cooperated with Skype,rolled out “PChome Skype”.
• 2005.01IPO–網家(8044-TT)
1998
2000
2004
2008
2006
2002
• 2006.06JV with eBay, launched Ruten auction site.
• 2008.04Cooperated with BIG5 estate agencies, rolled out “Rakuya”(樂屋網).
• 2000.06Rolled out online shopping channel, started from 3C products.
• 2005.10Rolled out online store B2B2C service
• 2007.01Rolled out “PChome 24hr delivery” service.
2010• 2010.04Spin off Store division to “PChome store Inc (4965-TT).,”
PChomeOnline
(8044-tw)
AdminPortal Telecom E-commerce
IThome Weekly100%
Ruten Auction
65%
RakuyaHousing
16.7%
PChome Store
((((4965-tw))))66.7%%%%
PChome Group Structure (2011.Feb)
Parent Company
Subsidiaries
91.60%
1.70%
6.60%
E-commerce
Telecom
Portal
2010 Revenue Breakdown
2010.1-3Q
2008-2010 Quarterly Net Sales
1.9
1.81.9 1.9
2.0 2.0
2.12.2
2.42.3
2.7
2.9
1
1.5
2
2.5
3
'08
1Q
2Q 3Q 4Q '09
1Q
2Q 3Q 4Q '10
1Q
2Q 3Q 4QBillion
((((TWD))))
(Unconsolidated)
3 Major Business Models of E-Commerce
PChome
E-commerce
Layout
Professional seller/
Casual seller
SMEGeneral customerRevenue
Target
Subsidiary.
Holding 65%
JV with eBay
Subsidiary.(4965-TT)
Holding 66.7%
Parent Company
(8044-TT)
Note
eBayRakuten IchibaAmazon.comGlobal
Icon
Seller →
Auction platform→Buyer
Online Store →Marketplace platform→
Consumer
Shopping site →Consumer
Business Model
C2C
Online Auction
B2B2C
Online Shopping Mall
B2C
Online Shopping
Type
Industry Introduction
US Online Shopping Market Scale
Source:MIC
US Online Shopping/Total Retail Scale
Traditional Retail vs. E-retail
Walmart and Amazon
Revenue YoY Growth%
11.40%
9.80% 11
.60%
8.60%
7.20%
1.00%
22.67
%26.
16%
38.50
%
29.19%
27.88%
39.56%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
2005 2006 2007 2008 2009 2010
Walmart Amazon
Traditional Retail vs. E-retail in US
22.97%
23.43%
23.50%
23.70%
24.80%
3.65%
3.64%
3.27%
3.40%
3.34%
24.00
%
22.90
%
22.60
%
22.30
%22.60
%
22.35
%
4.23%
1.77% 3.2
1%3.3
7% 3.68%
23.08%
3.56%
3.37%
0%
5%
10%
15%
20%
25%
30%
35%
40%
2005 2006 2007 2008 2009 2010
Walmart GP% Walmart NP% Amazon GP% Amazon NP %
Wal-Mart and Amazon Profit Ratio
China Internet Company IPO on NASDAQ & NYSE
2011 & after201020092007200420032000
Portal
Travel & Ticketing
Online Gaming
E-commerce
China Internet Company Valuation
Company Sector Market cap
(USD)
P/E (ttm)
(USD)
EPS (ttm)
(USD)
Sina Portal/Media 5.71Bn 13.32 7.00
Sohu Portal/Media 3.38Bn 24.53 3.62
Netease Portal/Media 5.70Bn 17.71 2.48
SNDA Game 2.57Bn 22.01 2.03
The9 Game 200.52Mn - - -2.43
Perfect World Game 1.07Bn 7.61 2.81
Cyou Game 1.92Bn 11.16 3.3
SNDA Games Game 1.70Bn 8.38 0.71
Ctrip E-commerce 6.16Bn 44.9 0.96
eLong E-commerce 349.27Mn 137.02 0.10
Dang E-commerce 1.98Bn 185 - -
Alibaba E-commerce 10.52Bn 70.61 0.23
MCox E-commerce 162.60Mn 47.72 0.11
Source: yahoo finance.11.2.14, Reuters
U.S. Internet Company Valuation
Company Sector Market cap
(USD)
P/E (ttm)
(USD)
EPS (ttm)
(USD)
Yahoo Portal/Media 22.10Bn 18.72 0.9
AOL Portal/Media 2.26Bn - - -7.34
Electronic ArtsGame 6.05Bn - - - 1.21
Activision Blizzard Game 13.00Bn 36.67 0.29
Amazon E-commerce 85.35Bn 74.8 2.53
eBay E-commerce 44.81Bn 25.37 1.36
Expedia E-commerce 5.90Bn 13.69 1.56
Priceline E-commerce 22.36Bn 49.48 9.2
Source: yahoo finance.11.2.14
China Online Payment Breakdown
PChome B2C Highlight
‧‧‧‧Founded::::2000.6
‧‧‧‧http://shopping.pchome.com.tw
‧‧‧‧Service model: Non-inventory, order transfer
‧‧‧‧Members::::5millions
‧‧‧‧ + 800,000 products in wide selection (includes PChome 24h shopping)
‧‧‧‧Coordinate with +5,000 suppliers
PChome B2C Business I
‧‧‧‧Launched::::2007.01‧‧‧‧http://24h.pchome.com.tw‧‧‧‧Service Model: Consignment in-stock central warehouse
‧‧‧‧Items::::379,348 (’11.02)‧‧‧‧On time rate::::99.67%‧‧‧‧24 hrs delivery guarantee
PChome B2C Business II
Provider Provider Provider
Buy
Day 5Delivery
Day3 Delivery
ConsumerDay6 Delivery
BeforeTraditional e-Commerce Model
Products shipped by
PChome within 24hrs
Products shipped by variety of providers
(Order transfer model)
PChome 24h Shopping Service
Customers:
Real-time order checking system
PChome 24h Shopping On Time Delivered :99.67%
2
67
8
9
5
4
31
Subsidiary -PChome Store Highlight
PChome Store Inc.
‧‧‧‧Spun off since 2010.5 (4965-TT)‧‧‧‧Capital: NTD $129.4Mn‧‧‧‧Service launched:2005.10‧‧‧‧http://store.pchome.com.tw ‧‧‧‧Business: SME online shopping mall‧‧‧‧# of Stores: 9,430 (’11,02)‧‧‧‧# of items::::3,237,301 (’11,02)
‧‧‧‧HQ location: Taipei, Taiwan‧‧‧‧Employee::::102
PChome Store SME Cloud
26
Lower Cost Brings Higher Profit
Online storebrick-and-mortar
# of Stores 2005 - 2010
110
1,545
3,143
4,872
7,343
9,343
0
1000
2000
3000
4000
5000
6000
7000
8000
9000
10000
2005 2006 2007 2008 2009 2010# of Store
PChome Store Revenue Model
NT$50~
NT$5,000(Web Ads and
extension courses)
Value-add
Service
ATM
Credit Card
CVS Kiosk
COD
2% (3% after 2nd year)
+ payment surcharge
No Annual maintenance Fee
NT$36,000
Payment Methods
Sales Commission
(by orders)
Annual maintenance
Fee
Online Store Set-up Fee
(one-time charge)
(2011.01)
Financial Highlight
2010 3Q PL vs. 2009 3Q PL
(unconsolidated)
NTD:000
2010 3Q 2009 3Q Variance YoY Growth
Operating Revenues 2,680,567 2,147,342 533,225 24.83%
Gross Margin 386,984 318,624 68,360 21.45%
Gross Margin Rate 14.40% 14.84% -0.44% -2.96%
Total Operating Expenses (329,399) (296,432) (32,967) 11.12%
Operating Profits 57,585 22,202 35,383 159.37%
Non-Operating Profits 70,622 11,631 58,991 507.19%
Net Profit before Income Tax 128,207 13,356 114,851 859.92%
Income Tax (20,079) 13,810 (33,889) -245.39%
Net Profit after Tax 108,128 27,166 80,962 298.03%
2010 1-3Q PL vs. 2009 1-3Q PL(unconsolidated)
NTD:000
2010 1-3Q 2009 1-3Q Variance YoY Growth
Operating Revenues 7,405,987 6,092,928 1,313,059 21.55%
Gross Margin 1,124,060 902,157 221,903 24.60%
Gross Margin% 15.20% 14.80% 0.40% 2.70%
Total Operating
Expenses(941,193) (836,153) (105,040) 12.56%
Operating Profits 182,867 66,004 116,863 177.05%
Non-Operating
Profits86,107 5,173 80,934 1564.55%
Net Profit before Tax 242,897 71,177 171,720 241.26%
Income Tax (26,077) 13,966 (40,043) -286.72%
Net Profit after Tax 216,820 85,143 131,677 154.65%
2010 1-3Q PL VS. 2009 1-3Q PL(consolidated)
NTD:000 (Consolidated)
2010 1-3Q 2009 1-3Q Variance YoY Growth
Operating Revenues 7,637,597 6,163,291 1,474,306 23.92%
Gross Margin 1,250,910 927,333 323,577 34.89%
Gross Margin Rate 16.38% 15.05% 1.33% 8.85%
Total Operating Expenses (1,062,994) (913,523) (149,471) 16.36%
Operating Profits 187,916 13,810 174,106 1260.72%
Non-Operating Profits 74,721 30,613 44,108 144.08%
Net Profit before Income Tax 262,637 44,423 218,214 491.22%
Income Tax (28,315) 14,186 (42,501) -299.60%
Net Profit after Tax 234,322 58,609 175,713 299.81%
EPSBefore Tax 4.63 1.27After Tax 4.18 1.52
Annual Revenue (consolidated) vs. Group Employee
4,690
6,235
6,851
7,589
8,412
473
657 695 730807
711
0
2,000
4,000
6,000
8,000
10,000
12,000
2005 2006 2007 2008 2009 2010
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
2,000
Revenue employee
NTD:mn
employee
2011 New Business & Movements
China & Global Market
Population:22Mn
Launched in July 2010Http://global.pchome.com.tw#of Items:225,225Deliver to 105 Countries
Language version: Traditional /Simplified Chinese
Payment:Taiwan credit card,
PChome Store
(4965-tw)66.7%%%%
PChomeOnline(8044-tw)
AdminPortal E-commerce
IThome Weekly100%
Ruten Auction
65%
RakuyaHousing
16.7%
PChome Skype
100%%%%
2011 PChome Group Structure
Parent Company
SubsidiariesIPO in 2011 1H Spin-off in 2011 Mar.
Thank you
Contact: Vicky TsengEmail: [email protected]
Skype:cookiecat86TEL:+886-2-2700-0898 ext 879
Mobile:+886-958-915-256