VS Media Holdings Limited (NASDAQ:VSME) ("VS Media" or the "Company") today announced its financial results for the fiscal year ended December 31, 2023.

“Fiscal 2023 was a challenging year as our business was negatively impacted by weakened market sentiment, decrease in client spending and the temporary suspension of our social commerce business,” said Ivy Wong, Founder and CEO of VS Media. “That said, we believe the worst is behind us. As 2024 continues to unfold, we expect strong growth in our top line and profit margin driven by cross-regional brand partnership, AI-enabled digital content, and recovery in social commerce. We are confident that some of the strategic partnerships and new market entry that we have announced recently will start to pay off commercially this year.”

2023 Financial Summary

  • Revenue was $7.99 million, compared to $9.03 million in the prior year;
  • Overall campaign-based marketing services revenue grew 12.7% yoy to $4.40 million;
  • Revenue of campaign-based marketing services in Hong Kong grew by 105.7% to $2.16 million as compared to $1.05 million in the prior year;
  • Gross profit was $1.64 million, compared to $2.28 million in the prior year;
  • Net loss was $6.59 million, compared to $3.52 million in the prior year; and
  • Operating cash flow was $7.24 million, compared to $2.05 million in the prior year.

During fiscal year 2023, VS Media recorded revenue of $7.99 million compared to revenue of $9.03 million in the prior year. The decrease in revenue was mainly attributable to decreased revenue from the Company’s Optimization-Based Marketing Services and Social Commerce businesses. The decrease was a result of weakened market sentiment, change in service mix as the company recalibrated internal resource to focus on higher margined Campaign-based marketing services in Hong Kong and the Company’s strategy to temporarily suspend its Social Commerce business to optimize resources allocation.

Gross Profit for the year was $1.64 million compared to $2.28 million in the prior year. The overall decrease in gross margin to 20.5% was due to the abovementioned factors.

The Company reported a net loss of $6.59 million for the year, mainly due to listing related one-time expenses.

2024 Financial Guidance

  • VSME expects its business activities to recover due to cross-regional brand partnership, artificial intelligence -enabled digital content, and resumption of social commerce business in mid-year.
  • As a result, the management expects revenue to growth by 20% year-over-year compared to the fiscal year 2023 and to achieve positive net margin.

Share Repurchase Program

VS Media today announces that its Board of Directors approved a 10b-18 share repurchase program with authorization to purchase up to 500,000 of the Company’s Class A Ordinary Shares. This plan is effective immediately for up to a one-year period.

Under the share repurchase program, the Company may repurchase its Class A Ordinary Shares from time to time through open market purchases, in privately negotiated transactions, or by other means, including through the use of trading plans, intended to qualify under Rule 10b-18 under the Securities Exchange Act of 1934, as amended, in accordance with applicable securities laws and other restrictions.

The timing, manner, price, and total amount of any share repurchases under the share repurchase program are determined by the Company at its discretion through various factors, including but not limited to business, economic and market conditions, corporate, legal and regulatory requirements, prevailing stock prices, trading volume, and other considerations. The share repurchase program may be modified, suspended or discontinued at any time and the Company is not obligated to acquire any amount of stock. The Company expects to utilize its existing cash and cash equivalents to fund any repurchases under the share repurchase program.        “As market sentiment stabilizes in 2024, I am pleased with the momentum that we’ve seen across our business segments so far and will remain hyper focused on adding value between brands and creators to grow our marketing services on the one hand and resuming our social commerce business on the other. The announcement of share buyback demonstrates confidence in our business fundamentals and our commitment to shareholders,”

“VS Media continues to leverage our extensive capabilities in digital marketing and content creation. We are well-positioned to capitalize on emerging trends and opportunities related to digital marketing. In addition, VS Media's commitment to fostering talent and empowering content creators positions us as a catalyst for innovation and creativity in the digital space. By cultivating partnerships and investing in leading technologies, we are poised to drive growth, expand reach, and unlock new revenue potential in the years to come,” said VS Media CEO Ivy Wong.

Recent Developments

In February 2024, VS Media entered into a strategic investment in Los Angeles-based creative venture studio MeeshQ. The investment comes as part of a partnership connecting MeeshQ's globally renowned talents and creators with VSME’s emerging local brands in Asia Pacific. The partnership brings future opportunities for brand sponsorship, product venture and other commercial opportunities, as well as helping talents launch their own products in the Asia Pacific region. MeeshQ and VSME plan to launch a number of global ventures in 2024 with high-profile American contemporary talents such as Mike Tyson and Dennis Rodman in Asia Pacific. VS Media will be MeeshQ's exclusive partner in the region.

Additionally, in February 2024, VS Media partnered with global entertainment company The Pinkfong Company and fine dining provider King Parrot Group to launch a VS Lounge in Hong Kong's Central Waterfront. The event series successfully ran from February 2, 2024through February 25, 2024, at the Central Waterfront, spanning across the Lunar New Year and Valentine's Day as an all-day family-oriented event. The event demonstrated the Company’s ability in collaborating with top tier content creators with customers in online and offline settings.

In October 2023, VS Media announced its expansion into Macau, further solidifying its presence in the Asian market. The strategic move into Macau allows VS Media to leverage its vast experience in digital marketing, influencer engagement, and content creation to support Macau businesses in promoting their offerings to a global audience. With a robust network of talented content creators, VS Media consistently delivers impactful campaigns that resonate with target audiences, driving brand awareness and engagement.

About VS Media

VS Media Holdings Limited (NASDAQ:VSME) manages a network of leading digital creators across Asia Pacific that powers content-driven social commerce and offers local and effective marketing services to brands. Founded in 2013, VSME partners with over 1,500 creators and over 1,000 brands to promote and merchandise their products and services. The Company is currently growing internationally across Hong Kong, China, Taiwan, Singapore, and beyond. For more information, visit https://www.vs-media.com.

Forward-Looking Statements

Certain statements in this announcement are forward-looking statements, including, for example, statements about potential activity under share repurchase plan. These forward-looking statements involve known and unknown risks and uncertainties and are based on the Company’s current expectations and projections about future events that the Company believes may affect its financial condition, results of operations, business strategy and financial needs. These forward-looking statements are also based on assumptions regarding the Company’s present and future business strategies and the environment in which the Company will operate in the future. Investors can find many (but not all) of these statements by the use of words such as “may,” “will,” “expect,” “anticipate,” “aim,” “estimate,” “intend,” “plan,” “believe,” “likely to” or other similar expressions. The Company undertakes no obligation to update or revise publicly any forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations, except as may be required by law. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that such expectations will turn out to be correct, and the Company cautions investors that actual results may differ materially from the anticipated results and encourages investors to review other factors that may affect its future results in the Company's registration statement and other filings with the SEC.

Contact information:

VS Media Holdings Limited

ir@vs-media.com

VS MEDIA HOLDINGS LIMITEDCONSOLIDATED BALANCE SHEETS(Currency expressed in United States Dollars (“US$”), except for number of shares)  
    As of December 31,  
    2023     2022  
ASSETS            
CURRENT ASSETS                
Cash and equivalents   $ 1,500,148     $ 820,570  
Accounts receivable, net     2,131,371       1,917,732  
Deposits, prepayments and other receivables, net     6,358,344       4,545,591  
Due from related parties     1,799       7,254  
Total current assets     9,991,662       7,291,147  
                 
NON-CURRENT ASSETS                
Plant and equipment, net     19,609       27,123  
Intangible assets, net     37,333       57,865  
Deposit paid for acquisition of intangible assets     -       115,601  
Right-of-use assets, net     34,143       100,589  
Total non-current assets     91,085       301,178  
                 
TOTAL ASSETS   $ 10,082,747     $ 7,592,325  
                 
LIABILITIES AND SHAREHOLDERS’ EQUITY                
CURRENT LIABILITIES                
Bank loans - current   $ 1,587,680     $ 1,628,048  
Other borrowings - current     432,241       -  
Accounts payable     1,837,795       1,036,790  
Due to related parties     90,589       504,837  
Loan – related parties     1,295,287       1,231,327  
Receipt in advance     139,341       59,069  
Lease liabilities     34,143       66,604  
Accruals and other payables     264,532       779,840  
Total current liabilities     5,681,608       5,306,515  
                 
NON-CURRENT LIABILITIES                
Other borrowings – non-current     208,116       632,737  
Lease liabilities – non-current     -       33,985  
Total non-current liabilities     208,116       666,722  
                 
TOTAL LIABILITIES     5,889,724       5,973,237  
                 
Commitments and contingencies                
                 
SHAREHOLDERS’ EQUITY                
Class A ordinary shares, unlimited authorized shares, no par value, 20,000,000 shares and nil issued and outstanding as of December 31, 2023 and 2022, respectively     8,047,695       -  
Class B ordinary shares, unlimited authorized shares, no par value, 2,000,000 shares and nil issued and outstanding as of December 31, 2023 and 2022, respectively     -       -  
Ordinary shares, no par value, nil and 20,000,000 shares issued and outstanding as of December 31, 2023 and 2022, respectively     -       20  
                 
Additional paid in capital     17,075,568       16,213,997  
Accumulated other comprehensive income     277,912       18,781  
Accumulated deficit     (21,208,152 )     (14,613,710 )
Total shareholders’ equity     4,193,023       1,619,088  
                 
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY   $ 10,082,747     $ 7,592,325  

VS MEDIA HOLDINGS LIMITEDCONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME(Currency expressed in United States Dollars (“US$”), except for number of shares)  
  For the years ended December 31,  
  2023       2022     2021  
Revenue, net $ 7,991,103       $ 9,028,187     $ 10,944,753  
Cost of revenue   6,351,394         6,743,205       8,662,313  
                       
Gross profit   1,639,709         2,284,982       2,282,440  
                       
Operating expenses                      
Marketing expenses   218,895         70,154       189,033  
General and administrative expenses   6,973,526         3,858,561       2,164,206  
                       
Total operating expenses   7,192,421         3,928,715       2,353,239  
                       
Loss from operations   (5,552,712 )       (1,643,733 )     (70,799 )
                       
Other income (expense)                      
Share-based compensation (861,551 )       -       -  
Other income   103,006         43,342       53,159  
Interest income   7,560         2       -  
Interest expense   (290,745 )       (206,842 )     (193,738 )
Total other expense, net   (1,041,730 )       (163,498 )     (140,579 )
                       
Loss before income tax   (6,594,442 )       (1,807,231 )     (211,378 )
                       
Provision for income taxes   -         -       -  
                       
Loss from continuing operations   (6,594,442 )       (1,807,231 )     (211,378 )
                       
Discontinued operations:                      
Loss from discontinued operations   -         (11,798 )     (21,246 )
Gain on disposal   -         5,344,229       -  
                       
NET (LOSS) INCOME $ (6,594,442 )     $ 3,525,200     $ (232,624 )
                       
Other comprehensive (loss) income                      
Foreign currency translation adjustment   259,131         591,294       (123,182 )
Total comprehensive (loss) income $ (6,335,311 )     $ 4,116,494     $ (355,806 )
                       
Loss per share from continuing operations - Basic and diluted $ (0.33 )     $ (0.09 )   $ (0.01 )
Income (loss) per share from discontinued operations – Basic and diluted $ -       $ 0.27     $ (0.00 )
(Loss) income per share – Basic and diluted $ (0.33 )     $ 0.18     $ (0.01 )
Weighted average number of ordinary shares outstanding - basic and diluted   20,000,000         20,000,000       20,000,000  

VS MEDIA HOLDINGS LIMITEDCONSOLIDATED STATEMENTS OF CASH FLOWS(Currency expressed in United States Dollars (“US$”))  
    For the years ended December 31,  
    2023     2022     2021  
                (Restated)  
CASH FLOWS FROM OPERATING ACTIVITIES:                        
Loss from continuing operations   $ (6,594,442 )   $ (1,807,231 )   $ (211,378 )
Loss from discontinued operations     -       (11,798 )     (21,246 )
Share-based compensation     861,551       -       -  
Depreciation and amortization     97,263       94,599       76,022  
Write off accounts receivable     -       5,321       -  
Write off inventories     -       369       1,713  
Expected credit loss allowance     -       204,000       57,000  
Inventories     -       8,778       65,386  
Accounts receivable     (213,639 )     479,236       (295,850 )
Deposits, prepayments and other receivables     (1,812,753 )     (1,130,984 )     (75,220 )
Deposit paid for acquisition of intangible assets     115,601       (114,938 )     -  
Receipt in advance     80,272       9,748       (663,709 )
Accounts payable     801,005       (247,422 )     47,352  
Accruals and other payables     (515,308 )     557,662       (303,978 )
Operating lease liabilities     (66,446 )     (66,683 )     (50,568 )
Net cash used in operating activities – continuing operations     (7,246,896 )     (2,019,343 )     (1,374,476 )
Net cash (used in) provided by operating activities – discontinued operations     -       (27,614 )     5,510  
Net cash used in operating activities     (7,246,896 )     (2,046,957 )     (1,368,966 )
                         
CASH FLOWS FROM INVESTING ACTIVITIES:                        
Purchase of plant and equipment     (2,810 )     -       (40,586 )
Proceeds from disposal of subsidiaries     -       2,174,025       -  
                         
Net cash (used in) provided by investing activities     (2,810 )     2,174,025       (40,586 )
                         
CASH FLOWS FROM FINANCING ACTIVITIES:                        
Proceeds from short-term bank loans     -       383,127       601,479  
Repayment of short-term bank loans     (40,368 )     -       -  
Proceeds from other borrowings     -       629,109       -  
Proceeds from IPO offering     8,047,695       -       -  
Promissory notes payable     -       (1,584,735 )     115,483  
Loan from a shareholder     -       71,716       71,716  
Proceeds from allotment of ordinary shares     -       500,000       -  
Repayments (to) from related parties     (350,288 )     (379,093 )     27,835  
Advances from related parties     5,455       -       668,287  
                         
Net cash provided by (used in) financing activities – continuing operations     7,662,494       (379,876 )     1,484,800  
Net cash provided by (used in) financing activities – discontinued operations     -       6,993       (15,403 )
Net cash provided by (used in) financing activities     7,662,494       (372,883 )     1,469,397  
                         
Net increase (decrease) in cash and cash equivalents     412,788       (245,815 )     59,845  
Effect of foreign currency translation on cash and cash equivalents     266,790       280,796       (127,759 )
Cash and cash equivalents, beginning of year     820,570       785,589       853,503  
                         
Cash and cash equivalents, end of year   $ 1,500,148     $ 820,570     $ 785,589  
                         
Supplemental cash flow information:                        
Interest income received   $ 7,560     $ 2     $ -  
Interest paid   $ 290,745     $ 206,842     $ 193,738  
Listing fee paid   $ 185,799     $ 1,031,485     $ -  

 

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