eVentures New Zealand Results Announced
eVentures New Zealand Ltd (eVentures NZ) has announced its first full year results, with the company incurring a consolidated operating loss of $4.56 million, after minority and tax interests for the period ending 31 December 2000.
This loss is less than had originally been budgeted, and includes the normal costs associated with the establishment of eVentures NZ and the launch of its two businesses - E-LOAN New Zealand, an online loan comparison and application service and MessageMedia, an online e-messaging service.
Given the current level of investments the monthly trend is now cash flow breakeven.
On May 9th 2000, eVentures raised $59 million, with equity at the end of the first financial year standing at $55.05 million.
"The result is encouraging, particularly given the difficult operating climate for e-commerce businesses," said Dr Roderick Deane, Chairman of eVentures New Zealand.
Dr Deane was appointed Chairman of eVentures NZ's Board in February 2001, following the resignation of Craig Heatley from the position.
MessageMedia New Zealand MessageMedia, which was launched at the end of July 2000, has successfully positioned itself as a leading e-messaging company in New Zealand. It has consistently performed ahead of target, while keeping capital expenditure below budgeted costs. It was cash flow positive in January, and the directors are very confident of the on-going growth and prospects of this company.
MessageMedia is working with a large number of blue-chip New Zealand companies including The Warehouse, NBR, Telecom Directories, New Zealand Post (NZ Post), Air New Zealand, INL, Fisher & Paykel, Hallensteins, Pumpkin Patch, and RD1.com
eVentures NZ has also recognised the significant cost advantage New Zealand has in the area of software development. Discussions are presently underway with MessageMedia Inc. for international software development to be provided through its New Zealand business.
Of particular significance in the period was the decision in September 2000 by NZ Post to take a 20% shareholding in MessageMedia New Zealand Ltd.
"The relationship with NZ Post is providing MessageMedia NZ with considerable commercial benefits, as well as assisting our own product development," said Cindy Mitchener, CEO of eVentures NZ.
E-LOAN New Zealand E-LOAN New Zealand (E-LOAN NZ) was launched on 21 June 2000. It offers home loans from 24 lenders and credit cards from over 20 credit card providers.
In November eVentures NZ undertook a review of the E-LOAN business model, taking particular note of the international experience. That review, and E-LOAN Inc. indicating that it's financial focus would be on the domestic market only, led eVentures NZ to in December downsize and restructure E-LOAN NZ. In this restructure E-LOAN was split into two distinct units, a Business to Consumer (B2C), and a Business to Business (B2B) unit.
This change is currently being implemented, with The Warehouse and eVentures NZ as the majority shareholders, and E-LOAN Inc. retaining a minority shareholding. The Warehouse will provide services including IT support and management, as well as utilising their offline advertising and promotion distribution opportunities.
Ms Mitchener said the partnership with The Warehouse had contributed to a considerable lowering of costs and a significant increase in potential customer contact. Both The Warehouse and eVentures NZ will review the arrangement at the end of 2001.
The B2B unit is focused solely on distribution of the E-LOAN "comparative engine" technology in the Asian market. eVentures has an exclusive arrangement with IT Capital, whose Singapore office is currently reviewing the market opportunities.
Business Development Over the past six months, eVentures NZ has fine-tuned its core strategic focus from six key sectors to three - online communications and new media, supply chain and mobile Internet.
Online Communications and New Media MessageMedia is the cornerstone of eVentures' online communications portfolio. Current market place activity has identified a customer need for a complete online communication solution provider. UnityMail, MessageMedia's e-messaging technology, is the current product offering. Through a combination of international licenses and New Zealand based investment, MessageMedia is developing a complete set of online communication tools to provide for the needs of its customers. Speed to market, the ability to add value to its established client base, and strong channel partnerships, are key factors in eVentures' ability to fast track the growth of this portfolio.
Supply Chain In the Supply Chain area, eVentures has recognised a significant commercial opportunity in providing modular solutions to companies making the transition from paper-based processes to internet-based solutions. While in its infancy in New Zealand, supply chain management using internet-based solutions is a growth industry worldwide, focusing on creating cost savings for customers.
eVentures' supply chain portfolio is developing a solution based around common architecture software to achieve collaboration and optimisation. The portfolio will be developed through strategic investment, with the sales effort being managed by channel partners working directly with clients.
Mobile Internet eVentures New Zealand has established a mobile Internet team, with two mobile telecommunications specialists, Andrew McPherson and Mark Rushworth. Both Andrew and Mark have considerable commercial and technical expertise in this area. They have performed a detailed analysis of the New Zealand market and have reviewed international opportunities for sourcing mobile Internet products, and are currently reviewing early stage New Zealand opportunities.
New Zealand is a world leader in the roll out of CDMA and GPRS. There are significant opportunities to invest in incubator applications, which have global potential. To date over 30 proposals have been reviewed, with five now in technical due diligence.
Summary "Whilst it was our original intention to make a greater number of investments during this period, progress to date reflects the changes in the online environment, our targeted strategic direction, and our disciplined approach to investment. We are now very well positioned to pursue opportunities in a market that has much more realistic valuations," said Ms Mitchener.
"eVentures remains confident that the initiatives which have been undertaken will maximise the value and return to shareholders over the coming years," she said.
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For further information please contact:
Cindy Mitchener CEO, eVentures New Zealand Ltd Phone: +64 9 359 5000 or 025 996 055
Craig Manning CFO, eVentures New Zealand Ltd Phone: 64 9 359 5000 or 025 793 526
Rachel Catanach Phone: 64 4 499 9111 or 025 322 784