RooLife posts record quarter sales, receives $1.7m injection for e-commerce expansion plans
RooLife revealed more than $1 million in net positive cash flow for the June quarter.
An acceleration of online sales to Chinese consumers during the three-months ending June has delivered record revenue figures for digital marketing firm RooLife Group (ASX: RLG).
The company this week posted a preliminary $3.9 million revenue for the fourth quarter of financial year 2021, representing a 15% increase on the previous period.
Cash receipts for the quarter were also strong, totalling more than $5 million and leaving the company with $3.8 million in cash.
This amount has been further strengthened with $1.7 million in funds from a share placement received in the first week of July.
Investor placement
The placement was secured from Australian businessman Daniel Love, who has diverse interests in agriculture, transport logistics, supply chain management, properties and listed securities.
Mr Love has significant experience with business dealings in China and an understanding of food demand and supply to the Chinese market from his farming and agriculture background.
He made the investment decision following discussions with RooLife and on the back of the company’s achievements in cross border e-commerce for its core food, health and wellbeing products.
Placement terms
Under the terms of the placement, RooLife issued 74 million new and fully-paid ordinary shares to Mega Holdings Pty Ltd, which Mr Love owns and controls.
The shares were issued at $0.023 each, representing a 15% discount to the five-day and 30-day value weighted average price of the company’s securities.
They have all been issued on the same terms and rank equally in all respects with existing company shares.
Pivotal time
The deal makes Mr Love a substantial shareholder of RooLife at what managing director Bryan Carr has termed a “pivotal time” for the business.
“We have just rounded out another financial year of significant achievements and we are strongly positioned to deliver further growth and achievement next year,” he said.
“We have a fantastic range of international brands and products [and we have] established platforms and systems and a strong balance sheet to fund our expansion.”
Placement funds will be used for the continued expansion and sales of RooLife’s e-commerce platform and services, as well as for general working capital.
Cross-border platform
RooLife is a cross-border platform matching Chinese consumer demand with international brands and products.
The company identifies buying trends, secures distribution rights for international products that fit consumer needs, and provides the technology and sales infrastructure needed for brands to sell at scale in China.
RooLife generates revenue from a mix of service fees and commissions on products sold for clients including kombucha maker Remedy Drinks; skincare company Nuria; dry shampoo producer Colab; AFT Pharmaceuticals; Blis Probiotics; and health foods company Murray River Organics.
China’s online shopping market is worth an estimated $2.2 trillion.
It comprises around 900 million shoppers and is growing at 12% per annum.