NextMart Provides Update of Expected Fourth Quarter Financial Results and Outlines Business Strategy for 2007-2008
05 Junho 2007 - 1:00PM
PR Newswire (US)
NEW YORK, June 5 /PRNewswire-FirstCall/ -- NextMart, Inc.
(OTC:NXMR) (BULLETIN BOARD: NXMR) , an online trade media and
merchant company today announced its preliminary estimates of its
financial results for the fourth fiscal quarter ended March 31,
2007. Although the Company has not finalized its financial results
for the quarter, revenues are estimated to be in the range of $1.8
million to $2.1 million and the Company expects to report a net
loss on a GAAP basis. The decrease in revenues over the prior
quarter is primarily attributable to seasonal fluctuation and
repositioning of the Company's apparel business, as well as the
discontinuation of the Company's former beverage business in Wuhan,
China. The Company's expected loss is primarily due to the
write-off of bad debts associated with the discontinuation of the
beverage business, as well as the impairment of certain non-core
assets and rationalization of certain business units begun in the
third fiscal quarter. The Company expects to report a net loss
lower than the $27 million net loss reported for the third fiscal
quarter. Dr. Bruno Wu, Chairman and Chief Executive Officer of
NextMart, Inc. commented, "Although we are expecting a loss in Q4,
particularly due to the discontinuation of our former beverage
distribution business and divestment of non-core assets and
business units, we have progressed with our restructuring efforts
begun in the third fiscal quarter. We have enhanced our operating
structure and rationalized our supporting assets to ensure they
directly support our core transactional business in the area of
women's fashion." The Company's restructuring milestones have
included: (a) significant reduction of total overhead, consisting
mainly of non-operating expenses; (b) further divestment of
non-core assets that did not support the Company's renewed focus on
women's fashion and apparel; (c) contract for the repurchase of
28.5 million company shares that will be cancelled, thereby
reducing overall outstanding share count. Dr. Bruno Wu continued,
"We are working toward a smaller organizational structure centered
around William's Brand, our brand apparel and production management
subsidiary. In fiscal 2008, we plan to build revenues by leveraging
our core competency in online marketing, design, production and
channel management in the area of women's fashion and apparel. Our
goal is to develop China's largest online shopping community for
wholesale distribution and retail shopping in this industry
sector." Going forward the Company plans to pave the way for new
revenues by streamlining all business development efforts of the
women's apparel business into two key areas: (1) Creating organic
growth in its existing wholesale distribution/business-to-business
("B2B") operations and (2) Creating new growth within the retail
shopping/business-to-consumer ("B2C") sector. Management expects
the Company to return to operational profitability in fiscal 2008
and plans to issue financial guidance at a later stage once the
Company progresses with its B2B and B2C growth initiatives. In
fiscal 2008, key initiatives for the wholesale distribution/B2B
sector will be: (1) Adding B2B Clients. NextMart will attempt to
sign up additional foreign brands and wholesalers for outsourced
brand management and apparel design/production. (2) Providing B2B
Technical Services. The Company plans to provide technical services
(mainly virtual exhibition and e-commerce) to other e-commerce
providers in exchange for transactional commissions on sales
generated through their websites. Key initiatives for creating
growth in the retail shopping/B2C sector will be: (1) Building a
Direct Sales & Marketing Platform. Online, the Company plans to
develop a digital product catalog for distribution via the
Company's Credit 114 database and Her Village's female consumer
database. Offline, the Company will explore partnerships and/or
acquisitions of direct mail-order catalog companies. (2) NextMart
Private Labels. The Company plans to leverage its design,
production and brand-building capabilities to launch its own
private labels. These private labels will be sold through
NextMart's direct sales & marketing platform, allowing the
Company to integrate its vertical operations and earn a higher
return on sales. (3) NextPay Services. The Company plans to market
its NextPay Services as the back-end payment system for its online
wholesale distribution and retail shopping operations. NextPay will
be offered primarily through fixed-line telephones. Eventually, the
Company also plans to offer NextPay through mobile phones by way of
a national strategic partnership. About NextMart Inc. NextMart is
an on-line trade media and merchant company that builds
direct-buyer communities and services them with digital media
offerings, on- line exhibitions and customer loyalty programs.
NextMart also builds e-enabled distribution systems, transaction
platforms and business communities in fast growing Chinese vertical
markets, connecting buyers and sellers with a suite of turnkey
digital media, e-commerce, and information management solutions.
Companies leverage NextMart's web-based business media communities
to access vital industrial intelligence and forge trading
relationships with suppliers and buyers that promote cost
efficiencies and increased distribution reach. Learn more at
http:corporate.nextmart.net. Forward Looking Statements. This press
release includes statements that may constitute 'forward- looking'
statements, usually containing the word 'believe,' 'estimate,'
'project,' 'expect,' 'plan,' 'anticipate' or similar expressions
and include, but are not limited to, statements regarding future
financial performance and business plans. Forward-looking
statements inherently involve risks and uncertainties that could
cause actual results to differ materially from the forward-looking
statements. Factors that would cause or contribute to such
differences include, but are not limited to, continued acceptance
of NextMart's product and services in the marketplace, competitive
factors and changes in regulatory environments. These and other
risks relating to NextMart's business are set forth in NextMart's
Annual Report on Form 10-KSB filed with the Securities and Exchange
Commission, and other reports filed from time to time with the
Securities and Exchange Commission. By making these forward-looking
statements, NextMart disclaims any obligation to update these
statements for revisions or changes after the date of this release.
Contact Jeffery Li, Chief Financial Officer +86 139 1014 0768
DATASOURCE: NextMart, Inc. CONTACT: Jeffery Li, Chief Financial
Officer, +86-139-1014-0768, , for NextMart, Inc. Web site:
http:corporate.nextmart.net
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