Highlights from Global Sources' conference call

Seeking Alpha generously posts its transcripts of analyst conference calls and allows humble bloggers like your truly to use up to 400 words of them. Thanks guys! Here are some highlights from their transcription of last night's Global Sources call:

Merle Hinrichs on the earthquake’s business impact: From a business perspective which is on the minds of many investors, I am sure we do not expect any particular impact. Global Sources has a very small number of customers in this area. And all of our team members and their families in the vicinity are safe.

Hinrichs on print: …as expected, our print services lagged behind the strong growth in online, and exhibitions and were down approximately 1% to 11.6%. While our English-language export focus titles performed well, our Chinese-language titles including Electronic Engineering Times for China and the Chief Executive China Publications continue to be slow.

Hinrichs on the economic slowdown: …our business has counter-cyclical aspects to it. And to date our numbers are demonstrating this strength. While others are experiencing flatter declining business, the number of our online customers is growing and the number of booths at our shows in April was higher than ever. …Our value proposition remains strong for both buyers and sellers and becomes even more important during an economic slowdown. Suppliers need our services. They need to grow revenues or alternative revenues. The key issue for suppliers, in order to remain successful and to survive in a difficult market, is to open new markets by generating a steady flow of quality sales leads. This, in today's market, includes high growth areas such as Eastern Europe, Latin America and the Middle East. From the buyers prospective, in a slowdown, buyers still need to fill their retail shelves, with appropriately designed products, and at appropriate price points. They have to source and we are here to make that job easier for them.

Hinrichs responding to a question on whether Global Sources is an e-commerce company: Now, our revenue is derived from providing comprehensive marketing services, including the online service. In fact, the majority of our revenue comes from online services. So we have called it, of course it is a marketing service as opposed to an e-commerce service. Our competitors, who provide basically the same service, have referred to their revenue from precisely the same of value proposition as e-commerce.

Global Sources posts strong Q1

It looks as though the first quarter has been strong for Global Sources. Highlights of the just-released Q1 numbers:

• Revenue was $40.6 million, up 16% from $34.9 million.
  ∗ Online revenue was $21.9 million, up 27% from $17.3 million.
  ∗ Exhibitions revenue was $6.0 million, up 24% from $4.8 million.
  ∗ Print revenue was $11.6 million, down 1% from $11.8 million.
  ∗ Revenue from mainland China was $24.1 million, up 30% from $18.4 million.
• GAAP net income was $8.2 million vs. $6.5 million in 2007, up 26.1%

CFO Eddie Heng said "For the rest of 2008, we expect online and trade shows to continue to serve as the main growth drivers, and we anticipate revenue from China to continue growing faster than overall revenue. We also expect a positive impact from expanding sales representation for all of our products.”

Q2 revenue guidance has been increased to US$62 - 63 million.

Mobile on my mind

As regular readers will know, I have flushes of enthusiasm for mobile and what it might mean for B2B media and information in Asia. With 650+ million phones in China and India alone and over 3 billion around the world, it remains an under-utilised platform.

Yesterday, I attended a lunch organised by the American Chamber of Commerce in Hong Kong where a panel talked about mobile advertising. Marketing covers it here. A key focus of the three panelists was that, in order to be effective, advertisers should make use of the capacity to target messages. This is, in my view, central to any value which can be developed for the B2B markets where targeting is everything.

They were perhaps not quite as defensive as they should have been about the damage already done to the medium by blanket SMS spam campaigns although some questions from the floor were pretty pointed in bringing this up.

This is obviously all taking off in India as well as I came across three interesting pieces on this just yesterday:

1. WATblog.com does a round-up of mobile advertising channels already active in India. Some of them sound pretty intrusive and unappealing to me, but there's clearly good mileage in others.
2. Linking Hong Kong and India, contentrasutra.com reports on Buongiorno's launch of its mobile advertising solution into that market. Buongiorno is a Hong Kong-based value-added service provider focusing on mobile marketing solutions in which Japanese trading giant Mitsui is an investor. Unfortunately, their web site appears to have keeled over this morning amid all the excitement of expanding in the Indian market.
3. Getting closer to my interest in market-specific, B2B applications is the announcement that "People Group’s real estate property, Makaan.com, has launched an SMS based mobile application, developed by sister concern, Mauj Mobile". Interestingly, the product eschews GPRS/3G mobile internet functions and is entirely SMS based.
   

Earthquake - what's going on and how to contribute

Congratulations to my friends at Alibaba for a homepage banner which links to this page. It's the clearest I've seen, telling you what's going on, how to donate and with latest news updates.

The series of pictures of the wedding party immediately after the quake don't have the immediate impact of the dead children and weeping parents, but are very striking all the same.

A sad note, by the way, from yesterday's Aliblog entry: the company has 33 team members in Wenchuan who have not yet been accounted for.

An eye on the numbers in India

There's a really interesting little piece over at contensutra.com which gives a good feel for the current size of the B2B online market in India. It's based on an article in Outlook Business magazine. Highlights include:

• Total B2B transactions in India this year will likely hit the equivalent of US$100 billion.
• B2B online marketplaces could account for $15 - 20 billion of that.
• There is no source for these numbers which first emerged in an Economic Times article.
• Indiamart.com claims revenues of Rs38 crores (roughly US$10 million) and that they have been growing at 50% a year since 2003. It claims 500,000 buyer enquiries a month.
  
• Rival tradeindia.com claims 700,000 registered buyers and, although revenue numbers are not given, says they have grown at at 35% a year and will double this year.
  
• Other web sites quoted in the Outlook piece include Matexnet and Auction India. I wasn't familar with either of those.

The Outlook Business piece concludes 'Tradeindia’s aggressive expansion plans this year may well have something to do with Alibaba’s entry. "Competition is good, it keeps you on your toes," says CEO Bikky Khosla'.

More on earthquake support

Thanks also to Michael Duck of CMP Asia for responding to my request for more information on what our industry's doing in response to the earthquake victims in Sichuan. He says:

• CMP SinoExpo (in China)have donated RMB 100,000 to the Red Cross
• CMP Asia have donated US$15,000 to Medecins Sans Frontiers
  
• CMP Asia are donating a sum to be finalised from Staff and matched $ for $ by the company to Oxfam
  
• United Business Media are donating directly to the Red Cross.

Good for them.

What though I ask about Burma? What an awful mess that is and it's beginning to disappear from view. I guess virtually nobody in our industry has people or business there and, probably more to the point, very few trust the generals to point aid received in the country in the right direction. Thanks to one correspondent for pointing me to this release updating us on Medicin Sans Frontiers' view of the situation.

Update: the Marketing magazine web site also has an update on the way the advertising and sports industry is responding to the Sichuan earthquake. It points out that, "according to the Shanghai Daily, domestic and oversea donations have totaled RMB$9 billion".

The future of media in Asia

All that and lunch too. What more could you ask for?

My good friend Thomas Crampton has organised a lunch on 4th June at which some of the gurus of the industries will gaze into their freshly-polished crystal balls. Tom says those participating will include:

• Torie Henderson – Hong Kong-based Managing Director of OMD International, who will speak about Asia’s latest advertising trends, developments and innovations.
• Hiroko Hoshino – Tokyo-based Regional Online Director & FT Corporate Representative in Japan, who oversees FT.com advertising sales and online business across Asia.
• Felix Soh – Singapore-based Director of the Straits Times’ RazorTV will give the first public demonstration of paper’s soon-to-be-launched live interactive Internet TV.

I think I'm going to be in Beijing and so not able to attend. Boooo!

The event is co-sponsored by The Society of Publishers in Asia, the Asia Digital Marketing Association and the Foreign Correspondents Club of Hong Kong. It's timed to coincide with SOPA's annual awards for editorial excellence dinner.

I expect to see all of those of you who attend both the lunch and dinner in the FCC gym the next morning!

Global Sources and guaranteed date disasters

I have to admit that I was as surprised as the next man to see this article pop up in a site tracking Global Sources for me. I don't regularly follow the Gizmodo gadget site but it is quite fun. This piece advises nerds on what in their collections may be keeping them single.

And the Global Sources connection? One of their clients its seems makes what are described as "Creepy binoculars that make you seem like a pedophile are a definite no-no. So steer clear of these plushes with built-in binoculars. [Global Sources via Link]".


Still, as least they weren't the source of the Turd Twister. Modesty prevents further explanation. You'll have to read the piece. I can certainly see that they would be off-putting.

Solitaire is not alone

Bhupesh Trivedi's Indian Media Observer is well worth tracking if you want to keep up with the many things happening in that market. Today, we read with interest that the Gem & Jewellery Export Promotion Council (the organiser, amongst other things of India's largest jewellery show), has outsourced production of its house magazine to Spenta Publishing. The magazine is called Solitaire International.

That set me thinking. Surely I'd heard the name before. I follow the jewellery industry media for a couple of clients. Yes, there is already a Solitaire magazine in Asia. It's published by Solitaire Media who have an interesting array of glossy titles around SE Asia.

China and Japan coming together

Before the earthquake, the big China story was President Hu Jintao's visit to Japan which included a visit from the Emperor and various other bridge-building exercises. For those doing scenario planning, the possibility of lowering the risk of China/Japan conflict is a very welcome one.

It's interesting to see more and more of the China-based Internet companies extending their reach into Japan. For example, Baidu reported a week or so ago that its Japanese traffic hit 713,000 person times in February. I suspect that's relatively small beer compared to market leader Yahoo! Japan but they obviously feel they're making sufficient headway to broadcast it.

We noted last week the brief announcement of Alibaba's Japanese tie-up with Softbank. There's more on this today with a detailed Reuters report from 14th May. The two companies will invest $20 million in Alibaba.com Japan which will "the new firm will take over the operation of Alibaba.com's existing Japanese language site" according to the report. Softbank is a long-term investor in Alibaba and still owns 30% of the Group.

Now, we also see that Xinhua Finance is getting in on the act. It is, of course, listed in Tokyo on the oddly-named "Mothers" exchange but is primarily focused on China business. Now, it is linking up with Microsoft "with the launch of a feature section on the financial portal MSN Money under MSN Japan ( http://money.jp.msn.com/ ) to fulfill Japanese investors' keen interest in China intensified by the momentum heading to the Beijing Olympics this summer".

Who's next?