Friday, May 23, 2008

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.

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