Kingdee International Announces 2020 Annual Results

Rhea-AI Summary

Kingdee International Software Group announced its annual results for 2020, reporting a turnover of approximately RMB3.36 billion, a 0.9% year-on-year growth. Notably, revenue from Kingdee Cloud business surged by 45.6%, constituting 57% of total revenue. However, the enterprise resource planning (ERP) segment saw a 28.2% decline. Loss attributable to shareholders was approximately RMB335 million due to the shift towards a cloud subscription model. The company was recognized as a leader in the SaaS industry in China and has high growth expectations for its cloud products moving forward.

Positive

• Kingdee Cloud's revenue increased by 45.6%, accounting for 57% of overall revenue.
• Subscription ARR for Kingdee Cloud reached RMB1 billion, a 58% increase year-on-year.
• Kingdee Cloud Cosmic's revenue surged by 220% with 367 contracted customers.
• Kingdee Cloud Galaxy achieved over 31.4% revenue growth and maintains a high dollar retention rate above 86%.
• Recognized as a leader in the SaaS market by IDC for the fourth year.

Negative

• Loss attributable to equity holders was approximately RMB335 million.
• Revenue from the ERP business declined by 28.2% year-on-year.

HONG KONG, March 24, 2021 /PRNewswire/ -- Kingdee International Software Group Company Limited ("Kingdee International", "Kingdee" or the "Company", together with its subsidiaries, the "Group"; stock code: 0268.HK) today announced its annual results for the year ended 31 December 2020 (the "Reporting Period"). The Group continued to promote its business transformation strategy by focusing on the development and promotion of subscription cloud products. During the Reporting Period, the Group's Kingdee Cloud business increased by 45.6% year-on-year, accounting for 57% of the total revenue. Due to the strong growth of the subscription-based cloud services, contract liabilities related to subscription services increased by 95.7% year-on-year, Kingdee Cloud's subscription ARR (annual recurring revenue) was amounted approximately RMB1.0 billion, representing an increase of 58% year-on-year.

During the Reporting Period, the Group recorded a turnover of approximately RMB3,356 million, representing a year-on-year growth of 0.9%, while revenue from enterprise resource planning (ERP) business decreased by 28.2% year-on-year. The Group's cloud services business maintained a high growth rate through the execution of its cloud strategy and transformation, with revenue from the cloud services business reaching RMB1,912 million in 2020, representing a year-on-year growth of 45.6%. Loss attributable to equity holders of the Company for the period was approximately RMB335 million, due to the Group's vigorous implementation of its cloud subscription model transformation strategy, the proactive cessation of sales of some ERP software license products and increased investment in the research and development of cloud products such as Cosmic.

Kingdee International has consistently been honoured by respected global research institutions during the year. According to IDC's research, Kingdee has grasped the biggest share in the enterprise-grade ERM SaaS (Cloud ERP) and financial SaaS Cloud services industry in China for the forth year, and has retained the largest share in the enterprise application software sector for fast-growing Chinese enterprises for 16 consecutive years. Kingdee has become the only SaaS company in China which received the 2020 IDC Global SaaS Customer Satisfaction Award, ranking No. 1 in the ERP SaaS Customer Satisfaction. The company was also included in the Hang Seng Indexes Co., Ltd.'s newly established Hang Seng Technology Index as a Top-10 constituent stock (launched on July 27, 2020).

Kingdee Cloud Cosmic strengthened R&D, focused on the self-developed technology innovation to occupy the high-end market of large enterprises

Moving into the EBC era, large enterprises have laid out new requirements for digitalisation platform and industrial internet platform. As the first cloud-native architecture platform in China with the core objective of enabling EBC's five capabilities, Kingdee Cloud Cosmic has gained the attention of many large enterprises. As at the end of 2020, Kingdee Cloud Cosmic officially released the version V3.0, which continued to accelerate the application research and development, strengthened the technical advantages, and made important upgrades to the platform structure, while also focusing on optimising the system openness.

During the Reporting Period, Kingdee Cloud Cosmic's revenue recorded approximately RMB190 million, representing a year-on-year increase of 220%. Contracted customers was 367 in 2020, including central enterprises and large state-owned enterprises such as State Power Investment Corporation, China Merchants Group, China Tobacco Yunnan, Hisense, HBIS Digital, Zhejiang Communications Investment and PowerChina Real Estate; also including well-known large enterprises such as HUAWEI, HAECO Xiamen, Kerry Logistics, DIT, and Rongan property. Cosmic has supported industry leaders to achieve improving efficiency and localized innovation out of the digital transformation and business innovation.

Kingdee Cloud Galaxy deepened industry digital intelligence empowerment, becoming a star product for medium-sized enterprises

Kingdee Cloud Galaxy provided comprehensive solutions for the close-loop of enterprise value chain, including Omni-channel Marketing Cloud, Smart Accounting Cloud, Smart Manufacturing Cloud, Smart Supply Chain Cloud, PLM R&D Cloud, etc., and innovated in remote customer engagement and marketing and upgraded online implementation platform, realized the quick launch of subscription products which efficiently helped enterprises restructure digital enterprise capability, using digital empowerment to accelerate transformation and upgrade of enterprises.

During the Reporting Period, Kingdee Cloud Galaxy continued to grow steadily, achieving a revenue of approximately RMB1,141 million, representing a year-on-year increase of over 31.4%, dollar retention rate remained above 86% and accumulated over 17,200 customers, including Huawei Marine, iFlytek, MEGVII, Yanjin Shop Food, Seamild Foods, Yuan Qi Sen Lin, RLX Technology, CYG SUNRI and other well-known enterprise customers. Galaxy has become the choice of many new economy enterprises and industry unicorns, to realize innovation and high growth.

Kingdee Cloud Stellar focused on the integrated solution of operation + management to build a service platform for the growth of small and micro enterprises

During the Reporting Period, Kingdee released Kingdee Cloud Stellar, a new service platform for smart growth of small and micro enterprises based on the Cosmic platform, which focused on online operation and digital management of small enterprises, empowered enterprises with the three characteristics of "new accounting & taxation, new marketing and new business model". It provides SaaS services such as Finance Cloud, Tax Cloud, Purchase, Sale & Inventory Cloud and Ordering Mall, etc., and supported small enterprises to quickly restore production after the pandemic, customer acquisitions and expansion of revenue sources, intelligent management and real-time decision-making. In addition, Kingdee Jingdou Cloud achieved a 62.4% growth in subscription revenue, with over 160,000 cumulative customers and dollar retention rate of approximately 76%.

Multi-field cloud deployment, deep cultivation in industry with best practice

During the Reporting Period, EAS Cloud focused on upgrading tax control in the digital age, integrating business and finance, improving efficiency through data intelligence, and promoting cloud migration for existing customers. Kingdee Guanyi Cloud released the Cosmic e-commerce cloud version. Cloud-Hub quickly launched solutions such as "Health Check-In" and audio and video conferencing. Kingdee Finance has successively won awards such as recommended products by the Bureau of Small and Medium-sized Enterprises of the MIIT of China. Wojia Cloud service project has covered 165 cities across the country, and newly signed with the top 100 properties such as Lushang, Shenzhen Science Park and Logan Property.

Outlook

"Kingdee will continue to execute the cloud subscription transformation strategy, adhering to the philosophy of 'customer-centric, hardworking as foundation and long-term professionalism', and creating a new Kingdee with the subscription business model in the next three years." Mr. Xu Shaochun, Chairman of the Board and CEO of Kingdee International Software Group Company Limited, said, "In 2021, Kingdee will be more ambitious and more powerful to help every enterprise customer grow through challenges and strengthen themselves in adversity to enable enterprise business capability in the future."

About Kingdee International Software Group Company Limited

Kingdee International Software Group Company Limited ("Kingdee International" or "Kingdee") was established in 1993. It is listed on the Main Board of the Hong Kong Stock Exchange (stock code: 0268.HK) and headquartered in Shenzhen, the PRC. Adhering to the core values of "Acting in all Conscience, with Integrity and Righteousness", the Company is committed to helping businesses achieve their growth targets and let the sun shine on every company through dedicated services. It strives to provide them with the most trusted enterprise service platform.

Through persistent efforts to explore China's Cloud enterprise service market, Kingdee has retained the largest share in the enterprise application software sector for fast-growing enterprises for 16 consecutive years, and has grasped the biggest share in the enterprise-grade SaaS Cloud services industry for the 4 years. Kingdee is currently the only SaaS cloud service provider of Chinese enterprises selected into Gartner's global market guide, and has become the only Chinese SaaS company winning the 2020 IDC SaaS Customer Satisfaction Award.

In addition, Kingdee's diverse Cloud services and products are the preferred choices of leading enterprises. They include "Kingdee Cloud Cosmic" (digitalization and ecosystem platform for large enterprises), "Kingdee Cloud Galaxy" (intelligent growth service platform for medium-sized enterprises), "Kingdee Cloud Stellar" (intelligent growth service platform for micro and small-sized enterprises), "Cloud-Hub" (intelligent Cloud office), "Guanyi Cloud" (Cloud services for E-commerce operators), "Cargeer" (Cloud services for auto dealers) and "Wojia Cloud"(Cloud services for Property Industry). With its strengths in management software and Cloud services, Kingdee provides services and products to more than 6.8 million enterprises, government agencies and other organizations around the world.

For further information, please contact:

Wonderful Sky Financial Group Ltd.

Cecilia Ip / Jing Fang

Tel: (852) 3641 1317 / (852) 3970 2172

Email: kingdee@wsfg.hk

 

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SOURCE Kingdee

FAQ

What were Kingdee's total annual results for 2020?

Kingdee reported a turnover of approximately RMB3.36 billion for the year ended December 31, 2020.

What growth did Kingdee Cloud business experience in 2020?

Kingdee Cloud's revenue increased by 45.6% year-on-year in 2020.

What was the loss reported by Kingdee for 2020?

Kingdee reported a loss of approximately RMB335 million attributable to equity holders.

How did Kingdee's ERP revenue perform in 2020?

Kingdee's ERP business revenue decreased by 28.2% year-on-year.

What is Kingdee's outlook for future growth?

Kingdee aims to continue its cloud subscription transformation strategy and enhance its service offerings over the next three years.