Kuala Lumpur-Based Netccentric Posts Double-Digit Revenue Growth Of 45%

The Netccentric Limited Group, driven by growth across its various business units, has announced a sterling set of results for the full year of 2021 with total revenue leaping by 45% to touch S$11.52 million (RM35.60 million). (Note: S$1 = RM3.09)

Its EBITDA (earnings before interest, taxes, depreciation, and amortisation) increased by 17% YoY to S$0.30 million (RM0.93 million), while gross profit increased by 25% from the previous corresponding year to reach S$4.76 million (RM14.71 million) in FY2021, with group profit before tax coming in at S$0.08 million (RM0.25 million). (Note: EBITDA and profit before tax adjusted for extraordinary items relating to the issue of share options expenses, forex movements, professional fees relating to evaluation of M&A opportunities and a debt waiver in FY2020.)

In a statement to the Australian Securities Exchange where it is listed, Netccentric said that it has strong liquidity to execute its growth strategies with cash and cash equivalents of S$5.41 million (RM16.72 million) as at 31 December 2021, an increase of 60% from S$3.38 million (RM10.44 million) as at 31 December 2020.

Executive Chairman Ganesh Kumar Bangah said that the Group’s strong performance serves as “a reflection of the successful execution of the Group’s diversified growth strategies and the sound fundamentals of our business.”

“I am pleased to see strong volume growth across our customer base from both anchor and new clients in Nuffnang. In addition, our newer livestream selling business, Nuffnang Live Commerce, has successfully tapped into the booming social commerce industry, as we intended,” he added.

Nuffnang is Netccentric’s flagship influencer marketing platform which connects clients to more than 15,000 influencers, key opinion leaders, celebrities, and content creators, who collectively reach over 20 million engaged social media followers throughout Southeast Asia, making it the largest social media influencer community in Asia.

Nuffnang’s revenue growth increased by 33% YoY, achieving S$6.47 million (RM19.99 million) in FY2021 compared to S$4.87 million (RM15.05 million) in FY2020. Nuffnang contributed 56% of Group revenue in FY2021 and, as such, Nuffnang represents a core engine within Netccentric’s comprehensive marketing ecosystem.

Nuffnang Malaysia continues to be a key driver of growth with total revenue up by 54% YoY, with growth spread across its customer base. As revenue from the anchor client portfolio grew by 25% YoY, the total revenue indicates stronger growth with newer clients. The Group continued to strengthen its partnerships with key media agencies in FY2021, growing revenue from these sources by 40% YoY. Spend from direct clients grew by 88%, contributed by growth in campaign spending from key clients including Dutch Lady, which increased by 998%, and Hasbro, which increased by 132% YoY.

Nuffnang Malaysia has now achieved almost 100% adoption of its Campaign Management Platform amongst its clients and influencers, as they see the benefit of the platform in creating a smoother workflow and allowing real time monitoring of the performance of their campaigns. The platform brings Nuffnang the advantage of scalable growth.

In FY2020, the Group launched Nuffnang Live Commerce, a platform which helps merchants to convert social media comments into sales with a scalable and automated back-end solution designed for livestream selling.

In FY2021, Nuffnang Live Commerce began to scale up and successfully tapped into the booming social commerce industry. During the year, Nuffnang Live Commerce transacted a total of 61,184 orders with gross merchandise value (GMV) of S$4.31 million (RM13.32 million). The surge in transactions yielded significant revenue growth, coming off a low base to register a growth of 1,890%. Comparing YoY quarters, Q4 FY2021’s GMV is up 302% from Q4 FY2020 and transacted orders increased by +275%, from 7,810 to 29,321.

Nuffnang Live Commerce’s technology has helped to increase the efficiency of eShoplive’s operational and customer journey in 2021. eShoplive is a social live commerce platform and Malaysia’s first -supplier to business to consumer live commerce marketplace. Netccentric -made a strategic minority investment in eShoplive in May 2021 and became its exclusive technology, payment and fulfilment partner.

“The efficiency gains achieved through the strategic partnership have enabled eShoplive’s live selling business to grow rapidly, highlighted by a significant uplift in its GMV which grew by 255% in FY2021,” said the statement.

Meanwhile, Netccentric’s performance marketing agency, Plata & Punta (P&P), saw strong growth driven by increased media spend from key e-commerce clients in the baby products and bedding/interior design industries. The business unit achieved revenue of S$2.49 million (RM7.69 million) in FY2021, an increase of 76% from FY2020.

– P&P achieved stronger agency partnerships in FY2021 compared to FY2020 which has supported sustainable revenue growth. P&P drove highly positive double digit ROAS (Return on Advertising Spend) for a major client and grew revenue from this account by 207%.

Beyond the retail sector, P&P has developed another pillar of growth through education clients, which have increased their dependency on virtual open days, virtual school tours and virtual classrooms. Its growth in the latter part of FY2021 was supported by collaborations with agency partners to provide their clients with performance marketing solutions, and the Group retains a positive outlook for continued agency work of this type.

As for Netccentric’s social media agency, Sashimi, it continued its strong growth trajectory during FY2021. The business unit achieved revenue of S$2.48 million (RM7.66 million) in FY2021, +50% YoY from S$1.65 million (RM5.10 million) in FY2020. The growth reflects continued development of the Sashimi business, headlined by upscaling of its data analytics, storytelling and marketing-tech capabilities.

Sashimi’s approximately 50% YoY growth, in both the top and bottom lines, was driven by the strengthening of its core services in social media marketing through more data analysis, more marketing tech, better content production capabilities and new offerings in line with the growing interest in and adoption of the metaverse, including production of social media live-streamed mixed reality events and branded AR stickers for Instagram.