Meiwu Technology Co., Limited Reports Unaudited Financial Results for the First Half Fiscal Year of 2023
- Total revenues in the first half fiscal year of 2023 increased by 816.90% to US$10.68 million compared to US$1.17 million in the same period of 2022.
- Net loss in the first half fiscal year of 2023 decreased by 94.96% to US$0.28 million from US$5.53 million in the same period of 2022.
- Gross Profit in the first half fiscal year of 2023 was US$2.45 million, increasing 1,529.45% from US$0.15 million in the same period of 2022.
- Average daily active users of the Company’s online platform generated from selling food products decreased to approximately 63.4 compared to 197.3 in the same period of 2022.
- Number of merchants carried in the Company’s online platform generated from selling food products were 26 as of June 30, 2023, compared to 504 as of June 30, 2022.
- Type of goods carried in the Company’s online platform generated from selling food products were 8 as of June 30, 2023, compared to 3,225 as of June 30, 2022.
Insights
The substantial revenue growth reported by Meiwu Technology Co., Limited, primarily attributed to the acquisition of Mahao, signals a strategic expansion that has materially impacted the company's financial position. This growth trajectory, especially in the context of a global e-commerce surge, suggests that Meiwu is strengthening its market presence in the CPaaS sector, which is becoming increasingly relevant as businesses continue to integrate digital communication solutions.
However, the decline in daily active users and the drastic reduction in the number of merchants and types of goods on the platform raise concerns about the sustainability of the e-commerce side of the business. This could indicate a strategic pivot or a need for improved user engagement and merchant acquisition strategies. The increased gross margin is a positive indicator, reflecting improved operational efficiency or a shift towards higher-margin services.
The reported decrease in net loss and the substantial increase in gross profit are promising indicators of Meiwu's improved financial health. The reduction in general and administrative expenses, possibly due to non-recurring expenses from the previous year, has contributed significantly to cost control. However, the increase in sales and marketing expenses suggests an investment in growth, which should be monitored to ensure it translates into sustainable revenue increases.
Investors should note the decrease in cash and cash equivalents, which may raise questions about liquidity and cash flow management. While the decrease in net cash used in operating activities is encouraging, it is essential to assess whether this trend can be maintained as the business scales.
The contraction in the number of merchants and the assortment of goods offered on Meiwu's platform is atypical for an e-commerce company, which traditionally relies on diversity and volume to drive user engagement and sales. This could reflect a strategic shift or a response to market challenges, such as increased competition or changes in consumer behavior. The company's ability to convert offline users to online users is a positive sign, but the decrease in DAUs suggests that user retention and engagement could be areas for improvement.
Understanding the dynamics behind these metrics is crucial, as they can significantly influence the long-term viability of Meiwu's e-commerce operations. The company's focus on organic and green food products positions it in a niche market, which may offer competitive advantages but also comes with specific challenges, such as ensuring supply chain integrity and meeting consumer expectations for quality and sustainability.
Shenzhen, China, Dec. 29, 2023 (GLOBE NEWSWIRE) -- Meiwu Technology Co., Limited (NASDAQ: WNW) (“Meiwu” or the “Company”), an online and mobile commerce company providing organic and green food products to customers on its online platform and in its stores, enterprise short message service (“SMS”) and information technology to serve designated medical insurance institutions in China. The Company today announced its unaudited financial results for the six months ended June 30, 2023.
First Half Fiscal Year of 2023 Operating Highlights
| ● | Registered users of the Company’s online platform generated from selling food products were 729,131 as of June 30, 2023, compared to 711,534 as of June 30, 2022. | |
| ● | Average daily active users (“DAUs”) of the Company’s online platform generated from selling food products decreased to approximately 63.4 compared to 197.3 in the same period of 2022. | |
| ● | Number of merchants carried in the Company’s online platform generated from selling food products were 26 as of June 30, 2023, compared to 504 as of June 30, 2022. | |
| ● | Type of goods carried in the Company’s online platform generated from selling food products were 8 as of June 30, 2023, compared to 3,225 as of June 30, 2022. | |
| ● | Quantity of billing short messages of the Company’s revenue generated from short message service (“SMS”) increased to approximately 984.33 million compared to 79.41 million in the same period of 2022. | |
| ● | Average unit price of short messages of the Company’s revenue generated from SMS increased to approximately |
First Half Fiscal Year of 2023 Financial Highlights
| ● | Total revenues in the first half fiscal year of 2023 increased by | |
| ● | Net loss in the first half fiscal year of 2023 decreased by |
First Half Fiscal Year of 2023 Key Operating Metrics
The Company monitors the following key metrics to evaluate the growth of its business, measure the effectiveness of its marketing efforts, identify trends affecting its business, and make strategic decisions.
Registered users of the Company’s online platform. The Company defines this metric as the total number of the registered users of the Company’s online platform as of the end of the period. As an online and mobile e-commerce business, the Company believes that this is a key operating metric for understanding the growth of its business. The Company views the number of registered users at the end of a given period as a key indicator of the attractiveness and usability of its online platform. As of June 30, 2023, the registered users of Meiwu’s online platform exceeded 729,131, as compared to 711,534 as of June 30, 2022. The Company believes that this increase in registered users demonstrates the success that convert the offline users to online users.
Daily Active Users (DAUs). The Company defines daily active users, or DAUs, as users who have logged in or accessed its online platform, whether on a mobile phone or tablet. The Company calculates DAUs using internal company data based on the activity of the user account and as adjusted to remove “duplicate” accounts. The DAU number is a metric that Meiwu’s management uses to manage their operations. In particular, its management sets daily targets of DAUs and monitors the DAUs to see whether to make adjustments as to the promotional activities and advertising campaigns. For the six months ended June 30, 2023 and 2022, the average DAUs were 63.4 and 197.3 respectively.
Number of merchants. The Company defines this metric as the total number of the merchants which sell goods on Meiwu’s online platform as of the end of the period. Merchants sell goods on Meiwu’s online platform after passing the Company’s screening process. Different businesses offer different products. The number of merchants were 26 as of June 30, 2023, compared to 504 as of June 30, 2022.
Type of goods. The Company defines this metric as the type of the goods which provided in Meiwu’s online platform as of the end of the period. As of June 30, 2023, the type of the goods of Meiwu’s online platform were 8, as compared to 3,225 as of June 30, 2022.
Quantity of billing short messages. The Company defines this metric as the total quantity of the revenue generated from SMS for the period. The Company account for revenue from customers’ usage of text message on the Company’s Communication Platform-as-a-Service (“CPaaS”) platform. For the six months ended June 30, 2023 and 2022, the quantity of billing short messages were 984.33 million and 79.41 million respectively. The increase mainly due to the the acquisition of Mahaotiaodong (Xiamen) Technology Co., Ltd. (“Mahao”) on June 23, 2022.
Average unit price of short messages. The Company defines this metric as the average unit price of the revenue generated from SMS for the period. Different SMS channels offer different unit prices. For the six months ended June 30, 2023 and 2022, the average unit price of short messages were
First Half Fiscal Year of 2023 Financial Results
Revenues in the first half fiscal year of 2023 increased by
Total operating expenses in the first half fiscal year of 2023 decreased by
| ● | Cost of revenues in the first half fiscal year of 2023 increased by | |
| ● | Sales and marketing expenses in the first half fiscal year of 2023 increased by | |
| ● | General and administrative expenses in the first half fiscal year of 2023 decreased by | |
| ● | Research and development expenses in the first half fiscal year of 2023 decreased by |
Gross Profit in the first half fiscal year of 2023 was US
Net loss in the first half fiscal year of 2023 decreased by
Basic and diluted loss per share in the first half fiscal year of 2023 was US
Net cash used in operating activities in the first half fiscal year of 2023 was US
As of June 30, 2023, the Company had cash and cash equivalents of US
About Meiwu Technology Company Limited
Meiwu Technology Company Limited is a British Virgin Islands company incorporated on December 4, 2018, and conduct our business in China through our subsidiaries and variable interest entity, Meiwuzhishi Technology (Shenzhen) Co., Ltd (“VIE”). The VIE is an online and mobile commerce company and conduct our business through our online retail store on the website www.wnw108.com. The VIE sell a myriad of food products on the website all the food products sold on the website are from the suppliers. The VIE do not sell genetically modified food and committed to providing our customers with safe, high-quality, nutritious, tasty and non-genetically modified food products through our portfolio of trusted and well-known suppliers. Optimizing the Website and real-time data, the VIE able to respond to and match supply with demand for food products in keeping with consumer trends. On June 23, 2022, we had completed the acquisition of Mahaotiaodong (Xiamen) Technology Company Limited (“Mahao”). Mahao is a company engaging in providing internet access and related services based in Xiamen, China. Mahao operated a short message service platform to send customized content to terminal customers. Mahao is a mobile information service provider with rich industry experience. Enterprise Short Message Service (“SMS”) is currently the main business form of Mahao. Mahao utilizes its accumulated system development technology and business understanding based on customers’ industry to provide professional enterprise SMS services to customers. Mahao mainly provides customers with a complete set of services around enterprise SMS through various forms such as customized system development, enterprise instant messaging platform, API system docking, etc., including early debugging and opening of customer and Mahao platform docking, maintenance and upgrading of customer SMS operation system during operation, and solving problems such as delay in SMS transmission, ensuring smooth and fast SMS transmission. At the same time, Mahao takes auditing information security and optimizing customer experience as its responsibility. Through a rigorous program, mobile information content is audited to ensure that various enterprise SMS messages, including information verification, user notifications, member reminders, and marketing promotion, can be safely and effectively delivered to information recipients. On the basis of ensuring efficient transmission of mobile information and content security, Mahao provides various enterprise SMS services, including mobile business scenario construction, product operation support, consumer relationship management and support, for various financial, internet, e-commerce, express logistics and other enterprise customers.
Safe Harbor Statement
Certain statements made in this release are “forward looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. When used in this press release, the words “estimates,” “projected,” “expects,” “anticipates,” “forecasts,” “plans,” “intends,” “believes,” “seeks,” “may,” “will,” “should,” “future,” “propose” and variations of these words or similar expressions (or the negative versions of such words or expressions) are intended to identify forward-looking statements. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside the Company’s control, that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements. Important factors, among others, are: the ability to manage growth; ability to identify and integrate other future acquisitions; ability to obtain additional financing in the future to fund capital expenditures; fluctuations in general economic and business conditions; costs or other factors adversely affecting our profitability; litigation involving patents, intellectual property, and other matters; potential changes in the legislative and regulatory environment; a pandemic or epidemic. The forward-looking statements contained in this release are also subject to other risks and uncertainties, including those more fully described in the Company’s filings with the Securities and Exchange Commission, including the Company’s Amended Annual Report on Form 20F filed with the SEC on October 18, 2023, the Current Report on Form 6-K filed with the SEC on November 23, 2022, which may be amended from time to time, and in our Quarterly Report on Form 6-K that will be filed following this earnings release. The Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law. Such information speaks only as of the date of this release.
Contacts
Meiwu Technology Company Limited
Xinliang Zhang
Email: meiwuBS@usmeiwu.com
MEIWU TECHNOLOGY COMPANY LIMITED
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
| December 31, 2022 | June 30, 2023 | |||||||
| (Unaudited) | ||||||||
| ASSETS | ||||||||
| Current Assets: | ||||||||
| Cash | $ | 23,716,768 | $ | 15,783,731 | ||||
| Accounts receivable | 4,043,473 | 5,008,411 | ||||||
| Inventories, net | 344,823 | 259,269 | ||||||
| Advances to suppliers, net | 1,382,172 | 1,275,527 | ||||||
| Other current assets | 386,954 | 426,942 | ||||||
| Total Current Assets | 29,874,190 | 22,753,880 | ||||||
| Property and equipment, net | 183,386 | 121,453 | ||||||
| Right of use lease assets, net | 227,603 | 166,530 | ||||||
| Intangible Assets | - | 6,757,409 | ||||||
| Deferred Offering Costs | 9,893 | - | ||||||
| Goodwill | 7,700,569 | 7,700,569 | ||||||
| Total Non-current Assets | 8,121,451 | 14,745,961 | ||||||
| TOTAL ASSETS | $ | 37,995,641 | $ | 37,499,841 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| Current Liabilities: | ||||||||
| Accounts payable | $ | 4,990,647 | $ | 4,587,561 | ||||
| Short-term loan | 332,309 | 291,106 | ||||||
| Contract liabilities | 747,093 | 1,038,871 | ||||||
| Lease liabilities | 107,467 | 96,819 | ||||||
| Tax Payable | 204,232 | 388,520 | ||||||
| Accrued expenses and other current liabilities | 1,964,469 | 2,441,940 | ||||||
| Total Current Liabilities | 8,346,217 | 8,844,817 | ||||||
| Due to related parties | 3,679,717 | 3,619,505 | ||||||
| Long-term loan | 218,722 | 156,031 | ||||||
| Convertible notes | 5,550,607 | - | ||||||
| Lease liabilities | 144,163 | 37,705 | ||||||
| Total Non-current Liabilities | 9,593,209 | 3,813,241 | ||||||
| TOTAL LIABILITIES | $ | 17,939,426 | $ | 12,658,058 | ||||
| Commitment and Contingencies | ||||||||
| Stockholders’ Equity | ||||||||
| Ordinary Shares, no par value, unlimited shares authorized; 100,670,199 and 60,945,313 shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively | $ | - | $ | - | ||||
| Additional paid-in capital | 38,571,534 | 44,515,801 | ||||||
| Accumulated deficit | (17,081,329 | ) | (17,349,240 | ) | ||||
| Accumulated other comprehensive loss | (1,281,864 | ) | (2,161,936 | ) | ||||
| Equity attributable to owners of the Company | 20,208,341 | 25,004,624 | ||||||
| Non-controlling interests | (152,126 | ) | (162,841 | ) | ||||
| Total Stockholders’ Equity | 20,056,215 | 24,841,783 | ||||||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 37,995,641 | $ | 37,499,841 | ||||
MEIWU TECHNOLOGY COMPANY LIMITED
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND OTHER
COMPREHENSIVE LOSS
(Unaudited)
| For the Six Months Ended June 30, | ||||||||
| 2022 | 2023 | |||||||
| NET REVENUE | $ | 1,166,425 | $ | 10,683,243 | ||||
| COST OF REVENUE | (1,015,769 | ) | (8,228,377 | ) | ||||
| GROSS PROFIT | 150,656 | 2,454,866 | ||||||
| OPERATING EXPENSES | ||||||||
| Sales and Marketing Expenses | (414,750 | ) | (801,374 | ) | ||||
| General and Administrative Expenses | (5,122,188 | ) | (1,504,654 | ) | ||||
| Research and Development Expenses | (172,437 | ) | (107,626 | ) | ||||
| Total operating expenses | (5,709,375 | ) | (2,413,654 | ) | ||||
| (LOSS) INCOME FROM OPERATIONS | (5,558,719 | ) | 41,212 | |||||
| Gain on disposal of subsidiary | - | (29,279 | ) | |||||
| Other Income, net | 28,647 | (79,191 | ) | |||||
| LOSS BEFORE INCOME TAX | (5,530,072 | ) | (67,258 | ) | ||||
| Provision for Income Taxes | - | 211,368 | ||||||
| NET LOSS | (5,530,072 | ) | (278,626 | ) | ||||
| Less: net loss attributable to non-controlling interest | (24,926 | ) | (10,715 | ) | ||||
| OTHER COMPREHENSIVE LOSS | ||||||||
| Foreign Currency Translation Adjustment | (991,133 | ) | (880,073 | ) | ||||
| TOTAL COMPREHENSIVE LOSS | $ | (6,521,205 | ) | $ | (1,158,699 | ) | ||
| LOSS PER SHARE – BASIC AND DILUTED | (0.17 | ) | (0.01 | ) | ||||
| WEIGHTED AVERAGE SHARES OUTSTANDING – BASIC AND DILUTED | 39,376,394 | 80,917,493 | ||||||
MEIWU TECHNOLOGY COMPANY LIMITED
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
| For the Six Months Ended June 30, | ||||||||
| 2022 | 2023 | |||||||
| Net cash used in operating activities | (10,073,063 | ) | (333,642 | ) | ||||
| Net cash used in investing activities | (26,915 | ) | (6,762,905 | ) | ||||
| Net cash provided by financing activities | 7,670,698 | 157,068 | ||||||
| Effect of changes of foreign exchange rate on cash | 261,068 | (993,558 | ) | |||||
| Net decrease in cash | (2,168,212 | ) | (7,933,037 | ) | ||||
| Cash, beginning of the period | 26,634,332 | 23,716,768 | ||||||
| Cash, end of the period | 24,466,120 | 15,783,731 | ||||||
FAQ
What are Meiwu Technology Co., Limited's (NASDAQ: WNW) unaudited financial results for the six months ended June 30, 2023?
How did the average daily active users of Meiwu's online platform change from 2022 to 2023?
What is the current number of merchants carried in Meiwu's online platform?
How many types of goods are carried in Meiwu's online platform as of June 30, 2023?
What is the percentage change in net loss for Meiwu Technology Co., Limited from 2022 to 2023?
