Huifu’s Revenue Grew by 34% in the First Half Year, Suggesting a Success in Digital Transformation
August 22, 2019. Shanghai – Huifu Payment (or “Huifu”, 01806.HK) announced today its mid-term performance in 2019. In the first half of the year, Huifu’s transaction volume of payment has reached RMB 1.06 trillion, an increase of 25% over the same period in 2018; its business income was RMB 1.869 billion, an increase of 34% over the same period of last year; its gross profit reached RMB 460 million, an increase of 21% over the same period of last year; net profit was RMB 142 million, an increase of 73% over the same period of last year; its research & development investment in was RMB 123 million yuan, an increase of 66% over the same period of last year. With the rapid growth of the technology-driven business, Huifu has been speeding up its digital transformation.
Focusing on digital strategy, SaaS Service becomes the new growth point
According to the latest data released by the Central Bank, in the first quarter of 2019, the volume of the internet payments and mobile payment services provided by third-party payment companies increased by 13.4% compared with the same period last year. The payment industry will continue to see a steady growth, and digitalization has become an important outlet for the development of the payment industry.
According to the report of IDC, a research institute of the technology market, China’s SaaS market is expected to exceed RMB 32.3 billion in 2021, and the annual compound growth is expected to exceed 30% between 2018 and 2021. Huifu has seized the opportunities to promote the digital strategy and achieved remarkable results. According to its mid-term report, in the first half of 2019, Huifu’s SaaS volume reached RMB 76.2 billion, yielding RMB 199 millions of business income, an increase of 1,338% and 1,521% respectively over the same period of last year. The new business shows a strong impetus.
Huifu mainly cooperates with SaaS providers in the new retail sector to provide fourth-party payment services for merchants and improve value-added services such as FinTech and digital operation. Through sustained FinTech enablement, Huifu’s payments processing capabilities have significantly improved, with a peak of 10 million transactions in a single day. Up to now, Huifu has cooperated with 221 SaaS providers, an increase of more than 60% compared with its 137 partners at the end of 2018.
In addition, in June this year, Huifu and Weimob, an intelligent business service provider, jointly launched the “Weimob Payment” solution, in which both parties are expected to enable the digital upgrading of intelligent business through resource sharing and complementing each other’s advantages, to further empower small and medium-sized enterprises via intelligent payment services and create a “payment + marketing” closed-loop.
Improving business layout to facilitate digital upgrading in various industries
In 2019, Huifu has fully implemented the core strategy of digital transformation and continues to strengthen investment in areas such as Integrated Merchants Acquiring, SaaS Service, Industry Solution and Cross-border & International Business.
A Technology & Data Management Committee has been set up under Huifu’s Board of Directors to promote the implementation of the digital transformation strategy. At the same time, Huifu has also been engaged in developing industry solutions, exploring famous clients such as Taikang Life Insurance, and helping the traditional industries such as air-ticketing, logistics and supply chain to accelerate digital transformation.
Prior to that, Huifu and Jingtieyun Intelligent Logistics Technology Co., Ltd. had reached strategic cooperation, in which Huifu’s “Qizhangtong” solution enables Jingtieyun’s “Sky Network + Ground Network” multi-modal railway freight transport system, covering its “online + offline” transaction scenarios.
Huifu’s cross-border business provides excellent cross-border payment, financial and integrated solutions for domestic and foreign e-businesses. In the first half of 2019, Huifu’s transaction volume in Cross-border & International Business has reached RMB 20.8 billion, which is an increase of 210% compared with 2018, and the growth rate remains high. For exporters, Huifu, together with other financial institutions, introduces the solution of quick settlement of foreign exchange and finance to alleviate the financial pressure on the supply chain of exporters; for importers, Huifu provides one-stop cross-border payment services including fourth-party acquiring, customs bills, account system establishment, cross-border settlement, etc. Huifu has now become the first payment company in the industry to provide full-process solutions for overseas purchases, and has won the honorary title of “Best Service Provider of Cross-border Payment” awarded by CCPIT (China Council for the Promotion of International Trade) in July.
Technology changes payment & promotes innovation of business models
Huifu adheres to the idea that “technology changes payment” and pays attention to improving its technology capacity. Through years’ development in technological application, capital facilitation and resource integration, Huifu has effectively integrated the account management system, the payment and transaction channels, and the data-driven value-added services, focusing on the output of payment-based FinTech capabilities, linking and penetrating more diverse scenarios.
In 2019, Huifu continues to increase investments in R&D. As of the first half of the year, the company has spent RMB 123 million on R&D, an increase of 66% over the same period of last year. At present, the R&D staff account for 43% of the company’s overall workforce, and Huifu’s R&D capacity has caught up with that of the global leading technology companies. Currently, it is capable to process 100 million transactions per day, of which 90% are processed via cloud computing, and the transaction stability already reaches 99.997%.
The innovative one-stop payment solution “Zhihui Guanjia” (Smart Butler) developed independently by Huifu has won the “4th Edition of Top 10 FinTech Innovation Cases”. The company has applied for five patents for the invention, which has been recognized as a Grade-A high-tech achievement transformation project in Shanghai.
Huifu has also developed a fourth-party API and SDK, an online payment tool for new retail and cross-border businesses, which provides a developer-friendly experience. In addition, Huifu’s public technology platform makes the API accessible to all business sectors, entrepreneurs and partners, providing functions and services such as payment and settlement, fund collection, value-added account services, membership-centered marketing, and data analysis. Through the sharing service platform, process optimization & reengineering, and the all-round connection with customers, all business operations will be automatic, flexible and measurable. At the same time, Huifu will further improve data assets management, provide data analysis and visual tools around decision-making, marketing and employee enablement, and develop value-added services based on that.
The current development of technology shows infinite possibilities in the innovation of business models brought by new technologies such as cloud computing, big data, artificial intelligence, 5G, and blockchain. In the future, Huifu will make a new strategic layout, comprehensively promote digital transformation, and work with all parties in the industry chain to promote the intelligent upgrading of business through its leading technology and excellent operation.
Huifu is committed to becoming a payment technology company in the digital era. Technology innovation will be the driving force for Huifu’s future business development.