Xurpas details investments at first stockholders' meeting
MANILA, Philippines – Listed digital content provider Xurpas Incorporated detailed its strategy at its first stockholders' meeting on Wednesday, May 27, a few weeks after announcing its 2015 first quarter results.
“It was our first stockholders' meeting, so we didn’t know what to expect. A lot of stockholders want to understand the growth lever for Xurpas moving forward,” Xurpas Chairman and President Nico Jose "Nix" Nolledo said following the meeting.
The firm disclosed its 2014 revenue of P392.22 million ($8.77 million), compared to its 2013 full-year revenue of P252.06 million ($5.64 million).
Net income for 2014 also rose to P190.72 million ($4.26 million) from P119.49 million ($2.67 million) in 2013.
The firm’s revenue breakdown shows that the mobile consumer side of its business accounted for 79% of revenue, mostly in casual games, emoticons, and other content for smartphone users.
Xurpas also creates custom solutions to optimize mobile content and strategy for enterprise clients such as Holcim Philippines Inc. This accounted for 18% in 2014, with the balance supplied by interest and other income.
Nolledo further disclosed that the company still has about P895 million ($20.03 million) in capital from its initial public offering (IPO), after it committed $7.98 million (P356.5 million) in 4 different investments since the start of the year.
Dry powder for expansion
“We still have about 70% of the capital we raised through our IPO to use as dry powder for expansion,” Nolledo said.
He explained that the "main criteria" it looks for when deciding on investments "is what can get us established in the market quickest, and if it is beneficial to our business."
Nolledo cited the investment in Ninelives Interactive, which was meant to facilitate Xurpas' expansion into Indonesia.
“Through our investment in Ninelives, we were able to essentially add 300 million (Indonesia’s population), to the 100 million potential customers from the Philippines," he said.
Other investments were done to strengthen their position in smartphone gaming.
Finally, investments were also made to add new dimensions to Xurpas’ digital business.
“With Storm, we’re not just limited to games but we’re starting to do corporate benefits as well, allowing employees to design their own benefits and with Quick.ly, you’ve seen a Philippine company investing in a firm based out of Silicon Valley and bringing those products to a developing market,” Nolledo explained.
Southeast Asia as an evergreen market
Nolledo confirmed that Xurpas will focus on Southeast Asian expansion for the time being as the company views the region as ripe for digitalization.
“Southeast Asia has close to 700 million customers at around 30% Internet penetration and growing rapidly. Smartphone penetration is also increasingly rapidly at about 20%," he said.
Most of the market is untapped as well which may give new players an advantage over established Internet giants.
“It’s still an evergreen opportunity, if you have about 30% penetration than most of the market never entered the Internet. For that 70%, brands like Facebook or Google are unknown to them so there’s an opportunity to be one of the first products that they discover and experience,” Nolledo said.
The Xurpas chairman said that there are many different industries that are ripe for disruption through the cellphone around the region.
Despite this, he said that Xurpas will stick to its strengths for the time being.
“We’re not here to reinvent the wheel, we’ll stick to our strengths [as] we’re good at entertainment and things we can quickly deliver to digital consumers,” he said. – Rappler.com
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