Icon Culture Global Company Limited Announces Details of Proposed Listing on GEM of The Stock Exchange of Hong Kong Limited

Author: Icon Culture Global Company Limited / 2023-07-23 21:27 / Source: Icon Culture Global Company Limited

Icon Culture Global Company Limited Announces Details of Proposed Listing on GEM of The Stock Exchange of Hong Kong Limited

This press release is not for publication or distribution,directly or indirectly,in or into the United States.

This press release is for information purposes only and does not constitute an offer or an invitation to induce an offer by any person to acquire,purchase or subscribe for the securities of Icon Culture Global Company Limited (the "Group"). Potential investors should read the prospectus (the "Prospectus") to be issued by the Group on 30 December,2019 for detailed information about the Group and the Share Offering.

This press release is not for release,publication or distribution,in or into the United States (including its territories and possessions,any state of the United States and the District of Columbia). This press release does not constitute or form a part of any offer to sell or solicitation to purchase or subscribe for securities in the United States or in any other jurisdictions. The Offer Shares have not been and will not be registered under the U.S. Securities Act of 1933,as amended from time to time (the "U.S. Securities Act"),or any state securities laws of the United States or other jurisdictions,other than Hong Kong,and may not be offered,sold,pledged or transferred or delivered within the United States unless pursuant to an exemption from,or in a transaction not subject to,the registration requirements of the U.S. Securities Act or any applicable state securities laws of the United States. The Offer Shares may only be offered and sold outside of the United States in offshore transactions in accordance with Regulation S under the U.S. Securities Act. There will be no offer or sale of the Offer Shares in the United States.

Note: Unless otherwise defined,terms in this press release shall have the same meanings as those defined in the Prospectus together with any supplement thereto.

* * *

SHARE OFFER OF 45,000,000 SHARES (SUBJECT TO THE OFFER SIZE

ADJUSTMENT OPTION)

PUBLIC OFFER OF 4,500,000 SHARES (SUBJECT TO REALLOCATION)

PLACING OF 40,000 SHARES (SUBJECT TO REALLOCATION AND

THE OFFER SIZE ADJUSTMENT OPTION)

OFFER PRICE BETWEEN HK$1.38 AND HK$1.98 PER SHARE

TO RAISE UP TO APPROXIMATELY HK$89.1 MILLION

Investment Highlights

Has almost 10 years of experience and proven track record in providing integrated multimedia advertising and marketing solution services.

Three cornerstone investors invested over HK$20million. Ms. Le Luping was the general manager in the mobile internet group marketing department of Tencent Group. In 2015,she joined Shenzhen Lexin Software Technology Co.,Ltd; Ms. Lu Xiaochang is the executive director of Guangzhou Changyang Culture Communication Co.,Ltd; Mr. Long Yuan is currently a vice-president of AirMedia Group Co.,Ltd. ("AirMedia"). AirMedia was our customer in FY2017 and its subsidiary,Beijing Wentou AirMedia Co.,Ltd.,was the Group's supplier in FY2018 and 1H2019.

Has a large and diversified customer base,served over 180 customers from a wide spectrum of industries,customers include many well-known brand owners,such as KINGOLD Group,Chimelong Group,Tencent Group,Hengqin Life Insurance and so forth.

Established business relationships with more than 160 suppliers covering a wide range of advertising channels,including TV and radio channels,owners of offline out-of-home advertising spaces in shopping malls,lifts,buses and terminals (subway and railway).

Has exclusive out-of-home and online advertising resources and exclusive advertising spaces at key locations with widespread coverage,such as Guangzhou South Railway Station,Shenzhen Futian Transportation Hub,elevators and lobbies in a number of commercial buildings and housing estates in Guangzhou,the PRC; obtained exclusive advertising rights from Guangzhou KINGOLD.

Able to offer a wide range of online advertising resources based on preferences and behavior of internet users including social media and e-commerce platforms with the internet media giants in the PRC.

Management team is very experienced in providing integrated multimedia advertising and marketing solutions to customers in the PRC. Under their leadership,we have diversified the exclusive advertising resources,expanded the media operation and marketing team,and expanded the client base to include a number of well-known brands.

Has received various awards and recognitions,such as,''Leading Brands (Industry) 2017'' and ''Top 100 Brands in GHM Greater Bay Area'' from ABAS Expert Committee,Asiabrand Research and Asiabrand Assessment Center.

The advertising market in the PRC is at a stage of expansion,according to iResearch Report,total advertising revenue in the PRC (including both online and traditional offline advertising) is expected to grow continuously at a CAGR of approximately 18.8% from 2019 to approximately RMB1,589.8 billion in 2023.

Revenue increased by approximately 45.3% to approximately RMB208.9million,between FY2017 and FY2018.

Adjusted net profit increased by approximately 7.8% to approximately RMB18.6 million,between FY2017 and FY2018.

HONG KONG,Dec. 30,2019 -- Icon Culture Global Company Limited (the "Group"; Stock Code: 8500.HK),an integrated multimedia advertising and marketing solution service provider based inGuangzhou,the PRC with almost 10 years of operating history,today announced details of its listing on GEM of The Stock Exchange of Hong Kong Limited.

A total of 45,000 Shares (subject to the Offer SizeAdjustment Option),with the Public Offer of 4,000 Shares (subject to reallocation),and the Placing of 40,000 Shares (subject to reallocation andthe Offer Size Adjustment Option) are offered at a price between HK$1.38 to HK$1.98 per Share. The Company will raise up to approximately HK$89.1 million from the Share Offer. The Hong Kong Public Offer will begin on Monday,30 December 2019 and close at noon on Monday,6 January 2020. The allotment results will be announced on Monday,13 January 2020. Trading of the Shares will begin on Tuesday,14 January 2020 in board lots of 2,000 Shares each under the stock code 8500.HK.

Innovax Capital Limited is the Sole Sponsor,Innovax Securities Limited is the Sole Bookrunner and Sole Lead Manager; Marketsense Securities Limited and Pulsar Capital Limited are Co-Managers.

About the Group

The Group has almost 10 years of experience in offering integrated multimedia advertising and marketing solutions,which primarily engages in the provision of (i) traditional offline media advertising services; (ii) online mediaadvertising services; and (iii) PR,marketing campaigns and other services in the PRC. The Group offers integrated multimedia advertising and marketing solutions to our customers by assistingthe customers in formulating advertising strategies,identifying and sourcing the appropriate advertisingspaces,and evaluating the effectiveness of the advertisements following the completion of theadvertising projects,including strategicplanning,formulation of advertising solutions,provision and sourcing of advertising spaces,contentproduction,co-ordination with advertising platforms,execution of advertisements,organisation of PRevents and other promotional activities,as well as evaluation of the effectiveness of the advertisements to maximise the effectiveness of our customers' advertisements.

The majority of our revenue was generated from the provision of advertising services using non-exclusive advertising resources and other revenue generated from exclusive advertisingresources and PR,marketing campaignsand other services. The Group's recorded an increase in our revenue from approximately RMB143.8 million forFY2017 to RMB208.9 million for FY2018,representing a year-on-year growth of approximately 45.3%,and from approximately RMB67.2 million for 1H2018 to approximately RMB75.6 million for 1H2019,representing a growth of approximately 12.5%. In addition,adjusted net profit of approximately RMB17.3 million,RMB18.6 million and RMB9.5 million with adjusted net profit margin of 12.0%、8.9% and 12.6% in FY2017,FY 2018 and 1H2019 ("Track Record Period") respectively.

The Group had established business relationships with more than 160suppliers covering a wide range of advertising channels,owners ofoffline out-of-home advertising spaces in shopping malls,buses and terminals (subway andrailway). During the Track Record Period,the Group generated approximately 81.2%,80.9% and81.8% from the provision of advertising and marketing solutions using traditional offline media. The Group had certain exclusiveadvertising spaces at Guangzhou South Railway Station (for customers from property development andtourism industry sectors only),China Railway's 12306 onlineticketing system,elevators and lobbies in a shopping mall,commercial buildings,housing estates and agolf club in Guangzhou,the PRC. Tofurther promote the group's ownbrand,the Group has also installed its own frame displays registered under the brandname Visual Media. Non-exclusive advertising resources include advertisements during TV advertising time slots,placement oftraditional two-dimensional advertisements in TV,radio or newspapers; implantation of title sponsorship,verbal slogan or product placement in TV series or shows. billboards,transit (minibuses,taxis,buses,airports and subway) and other places (e.g. cinemas and shopping malls) to promotebusinesses,products and/or services as well as digital and traditional printing out-of-homeformats. According to the iResearchReport,out-of-home advertising business layout will become an important competitive advantage forintegrated marketing service providers in the future,especially for high-potential out-of-home scenessuch as elevators and high-speed railways,which is precisely the focus of the Group.

The Group has considerable experience in internet advertising,delivering advertisements to netizens such as Wechat users,video streaming site audiences and search engine users and have also established stable relationship with a handful of KOLs which have participated in promotion of product/services by implementing advertising measures such as instant sharing of short video clips and advertorials. The Group was able to offera wide range of online advertising resources based on preferences and behavior of internet usersincluding social media and e-commerce platforms with the internet media giants in the PRC. During the Track Record Period,the suppliers of web portal advertising platforms include agents of or companies who have access to the ad space of Tencent,Sina and Netease. The Group has also worked with suppliers such as Baidu,Tencent and Toutiao who provided news and information content to the public and helped Liby Group to publish their video advertisements on iQiyi,one of the largest internet video streaming service providers in China. The Group also assists customer in broadcasting their advertisements on social media platforms on WeChat,Weibo and Douyin. Customer are also offered search engine advertising platforms in,among others,Apple App Store and Baidu. The Group's directors believe that the coverage of our online media platforms and our establishedrelationships with major players such as Tencent,Baidu and Toutiao would allow us to (i) continueto maintain our position as a core business partner with our customers; (ii) further expand oursupplier base to gain direct access to different advertising platforms; and (iii) capture the growthopportunity in the integrated online media industry in the PRC.

Complementary to the Group's exclusive and non-exclusive advertising resources,the Group also assisted its customers in organising campaigns and events to promote their brands,services and products during the Track Record Period. The Group was the organisation of the joint marketing event of a leading online game in the PRC at Guangzhou Chimelong park and Zhuhai Chimelong park. Leveraging on the Group's experiencein PR campaigns and marketing events,and its established relationship with strategic partners. In June 2018,Chimelong Group appointed us as its service provider responsible for formulating,organising and implementing the Chimelong Project,an innovative joint marketing event between a mobile game andtheme park in the PRC. Apart from the Chimelong Project,we also provided PR,marketing campaigns and other services to a wide range of customers during the Track Record Period. The Group's customers under this business segment include PRC state-owned enterprises,famous PRC online entertainment companies,real estate developers and other renowned enterprises. The Group has completed such projects in the number of 62,136 and 44 for FY2017,FY2018 and 1H2019 respectively,and we assist our customers in carrying out carshows,commercial promotions,sports activities,live shows and maintenance works. For example,we were engaged by a customer in assisting the largest pick-up truck and sport utility vehicle manufacturer in the PRC to conduct an off-line marketing activity in relation to the debut of a new electric car in FY2018.

The Group has a large and diversified customer base,leveraging on our strengths and proven track record in offering integrated multimedia advertising and marketing solution. TheGroup was able to attract well-known brand owners and offered advertising and marketing solution services to many well-known brand owners in different industries. Most of the group customers are repeated customers and we have had business relationships for over twoyears with most of our major customers. During the Track Record Period,the Group served over 180 customers,including brand owners (including state-owned enterprises in the PRC),advertising agencies and government authorities,in which Liby Group,Hengqin Life Insurance,KINGOLD Group,Imperial Palace,a leading joint stock large-scale commercial bank in the PRC,a renowned Chinese medicine manufacturer in Hong Kong and in mainland China,one of the largest sport utility vehicle and pick-up truck producers in the PRC,one of the largest and luxurious car producers in the world and other well-known brand owners are also the Group's customers. Guangzhou Megahive Media Co.,Chimelong Group Company Limited,Guangzhou Liby Enterprise Group Co.,Ltd. and Beijing Mingrui Interactive Technology Culture Communication Co.,Ltd. are the five largest customers of the Group in FY2018. During the Track Record Period,the revenue from the Group's five largest customers of thecorresponding period accounted for approximately 83.0%,78.0% and 77.7%

According to iResearch Report,the advertising market in the PRC is at a stage of expansion and has experienced a steady growth in recent years. The total advertising market size in the PRC,measured by advertising service provider's revenue,grew from approximately RMB347.0 billion in 2014 to approximately RMB 652.8 billion in 2018,representing a CAGR of approximately 17.1%. The market size of the advertising industry in the PRC is projected to further expand at a CAGR of approximately 18.8% to approximately RMB1,589.8 billion in 2023. Due to the increasing popularity of the Internet,online advertising continues to develop rapidly and occupies the core driver of the PRC advertising market representing a CAGR of approximately 76.8%,accounting for approximately 75.6% of the total online advertising revenue. It is expected the proportion will reach 85.9% in 2023 and mobile advertising will be the major driver of online advertising market development in the future.

Mr. Eric Chow,Executive Director,founder and Chairman,said,"By obtaining the listing status,our reputation and financial strength will be further enhanced as a competitive edge over our competitors,thereby driving the business and making our services better known to attract potential customers in the PRC and international market. The Group targets to broaden our customer base in Northern China (particularly,Beijing and Shanghai) and the Greater Bay area to increase our market share. We believe the Group is able to grasp the future growth of the market. We are well-prepared to continue to seize new business opportunities and create long-term shareholder value."

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Financial Highlights

RMB'000

Year ended 31 December

Six Month ended 30 June

2017

2018

2018 (Unaudited)

2019

Revenue

143,765

208,941

67,197

75,625

Gross Profit

32,272

41,242

14,245

17,886

Adjusted net profit for the

year/period

17,262

18,614

6,934

9,510

Adjusted net profit margin for the

year/period

12.0%

8.9%

10.3%

12.6%

Offering Summary:

Total number of Offer Shares

45,000 Shares

Number of Public Offer Shares

4,000 Shares (subject to re-allocation)

Number of Placing Shares

40,000 Shares (subject to re-allocation)

Proposed Offer Price Range

HK$1.38 to HK$1.98 Per Offer Share

Board Lot

2,000 Shares

Hong Kong Public Offering Begins

9:00 a.m. on 30 December 2019 (Monday)

Hong Kong Public Offering Ends

12:00 noon on 6 January 2020 (Monday)

Expected Price Determination Date

7 January 2018 (Tuesday)

Announcement of Allotment Results

13 January 2018 (Monday)

Expected Listing Date

14 January 2020 (Tuesday)

Stock Code

8500.HK

Use of proceeds

The net proceeds of the Share Offer which the Group will receive,assuming an Offer Price ofHK$1.68 per Offer Share (being the mid-point of the Offer Price range and assuming that the Offer Size Adjustment Option is not exercised),will be approximately HK$43.7million,after deduction of underwriting fees and commissions and estimated expenses incurred by us in connection with the Share Offer,which is approximately HK$31.9 million. The Group presently intends to apply the net proceeds from the Share Offer as follows:

Use of proceeds

Percentage

HK$'000

Increase coverage of the Group exclusive OOH and online advertising resources by acquiring additional resources

54.6%

23,848

Expand group business coverage in growing regions and our spectrums of service offerings

29.0%

12,666

Enhance group big data platforms

6.4%

2,795