Company Overview: Yojee Limited (Yojee), formerly Southern Crown Resources Limited, is engaged in developing a sharing economy-based logistics technology through the creation of the Yojee delivery network and blockchain technology platform. The Company is engaged in the development of a logistics technology platform to enable mass participation in a sharing economy network to help both carrier and sender. The Company's collaborative economy technology platform focuses to provide on-demand movement of goods and services. The Company's platform aggregates and optimizes logistics businesses. Yojee implements real-time tracking and a blockchain technology payment system. Yojee will connect and enable logistics providers with limited geographical capability. Yojee will also help e-commerce companies. The Company focuses on developing a logistics software to serve small and medium businesses. The Company focuses on the Asia-Pacific region.
 

YOJ Details

The future ready platform technology company with its logistics and supply chain management skills, is expanding its partner network across Australia and South East Asia. The reliance on blockchain and artificial intelligence is helping the group to transform the logistics economic landscape through digital means.

Signed Services Agreement with Schenker (Asia Pacific) Pte Ltd: Yojee Ltd (ASX: YOJ), the technology company that utilizes artificial intelligence (AI) and blockchain technology to create a seamless regional freight network, witnessed its stock price surging high after the company signed a Services Agreement with Schenker (Asia Pacific) Pte Ltd. Schenker (Asia Pacific) Pte Ltd is the regional headquarters of DB Schenker in Asia Pacific, and YOJ has signed for the first stage of a potential broad DB Schenker regional technology rollout. As per the Services Agreement, Schenker (Asia Pacific) will pay YOJ a fee to commence a project for the implementation of YOJ’s platform into Schenker’s (Asia Pacific) Ecommerce and last mile operations. The project will cover but will not be limited to Warehousing, Cross-docking, Wharf cartage and last mile, Route optimization and operational efficiency modelling using YOJ’s AI simulator, Application of blockchain, Coordination of customer projects and Customer-facing experiences. Meanwhile, the project will run for up to four months, after which both the companies will plan and evaluate next steps. Further, this agreement with DB Schenker is expected to provide strong industry validation of YOJ’s unique value proposition to global logistics companies and the future potential of the company’s technology.

Introduced Version 2.0 Infrastructure: YOJ in the March 2018 quarter, introduced Yojee’s version 2.0 back end infrastructure using Elixir and Erlang technology, after conducting a market review and strategic analysis of future requirements. This redefined the stability and speed per transaction, and created new capabilities in at-scale tasks and delivered a large reduction in errors. Moreover, the modular concurrent programming used in the product rebuild will allow YOJ to deploy a white-labelled, individually branded application for a customer in a matter of hours and all the customizations are now more easily implemented. Additionally, the significant upgrade to the back end infrastructure has added value to YOJ’s existing projects and across the wide range of opportunities in the sales pipeline. The ongoing investment in this technology is consolidating YOJ’s leadership in the areas of speed, reliability, functionality and project delivery time and is especially useful for managing the large masses of data required to support global logistics industry leaders whilst greatly reducing errors and system downtime.

Completed Blockchain Integration and Successful Pilot with UPS: YOJ is an industry leader in blockchain technology and has deep in-house experience in the technology. During the March 2018 quarter, YOJ has outlined its blockchain development roadmap and successfully tested its first blockchain product, which is Proof of Existence, that included hashing the status of the database to the blockchain in real-time. Moreover, later in the March quarter, YOJ entered into a pilot services agreement with UPS Asia Group Pte Ltd (UPS) (a subsidiary of global logistics leader, United Parcel Service, Inc.), to establish a proof of concept for the use of YOJ’s blockchain technology in the UPS specific supply chain environment. The blockchain pilot with UPS was very successful and completed in April, and both companies are now into discussions over next steps.


Yojee’s Exemplary Network (Source: Company Reports)

On Track to Deliver Scharff Domestic Freight Module: YOJ was reported to be on track to deliver the first phase of the project to Scharff and the deliveries were expected to go live within weeks. The solution will digitise and optimise domestic freight fleet and will provide an enhanced user and customer experience. Further, this new platform enables end to end digitization of a series of manual processes and provide a much higher level of visibility and efficiency.

Adding New Capabilities: YOJ has added a number of highly experienced software engineers across South East Asia and is also in the process to add significant new capabilities to the company. As a result, YOJ now has in place a technology organisational structure which can rapidly scale and a clear technology roadmap to enable it to continue to grow across industry with increasing volumes of delivery transactions.

Increasing the total number of signed, minimum spend, SaaS contracts: YOJ during the first three months of the year, signed five new SaaS clients across multiple geographies and the company had renewed the contract with one client. The total minimum contractual value of these contracts will provide meaningful revenue to the company over the next 24 months, once fully rolled out. The majority of the new clients was expected to be immediately onboarded on to the Yojee 2.0 product in May and June. Moreover, for the march 2018 quarter, YOJ focused on establishing sales teams in new cities and on the signing up and onboarding of enterprise clients and their partner networks. The software sales continued to grow strongly during the March quarter despite the company no longer focusing on its version 1.0 product and is now transitioning to its version 2.0 product. The company has signed new customers and implemented in multiple countries, with a significant increase in interest from companies outside of South East Asia. Therefore, with the new product and its intelligent capabilities, the sales team will now be able to capitalise on the enormous inbound interest in YOJ’s technology platform.

Partnership with Sinotrans Integrated Logistics Australia: During the March 2018 quarter, YOJ signed the partnership with Sinotrans Integrated Logistics Australia (SILA), which is a part of the Sinotrans and CSC international network, China’s largest shipping and logistics company. SILA has contracted YOJ for an initial two-year term to be their logistics software partner in order to maximise delivery visibility, optimise their dispatching capabilities and manage their third-party partners with the use of YOJ’s Control Tower. Moreover, SILA has now completed its testing phase and is beginning its preparation for a full scale roll out across it's delivery network. YOJ expects that there is potential over the coming months or a number of new opportunities to arise through the network effect of the technology and also the large number of companies looking for a similar product. As per YOJ’s market research, there are hundreds of companies in Australia alone that could utilise this specific product.

Growth of Singapore freight network deliveries by approximately 20% compared to peak Christmas period: In the last quarter, YOJ has set a new record of nearly 6,000 deliveries completed over Yojee’s Singapore Freight Network split across Express, Same Day and Next day services. The orders were completed across Singapore by Yojee freelance drivers and downstream last mile partners. The result constitutes nearly 20% growth over the fourth quarter 2017 (Christmas quarter) where seasonality sees a huge rise in orders.


Half Year Ended December 2017 Financial Performance (Source: Company Reports)

Half Year Ended December 2017 Performance: YOJ for the half year ended December 2017 has reported 904% growth in the revenue and 357% rise in the Net Loss from ordinary activities Attributed to Members. As under its growth phase, the company has no proposal to pay dividend.


Cash Flows (Source: Company Reports)

Stock Performance: YOJ stock, as per March 2018 Quarterly Rebalance of the S&P/ASX Indices, was added to All Ordinaries, effective from March 19, 2018. Meanwhile, YOJ stock has risen 142.2% in last one year as on May 31, 2018 but has been down 18.4% in last three months, giving an entry opportunity at low levels. The stock was further down over 3% on June 01, 2018 before trading flat while the group notified about release of restricted securities from escrow.  Recently, there has been a rising demand for stocks with exposure to blockchain and artificial intelligence due to the popularity of the cryptocurrencies and newer technologies, and this seems to be helpful for YOJ. In the March 2018 quarter, the company had completed the integration of blockchain into its software products, and ran a successful pilot with delivery giant UPS in Asia, and is now progressing through next steps. The freight and logistics industry is investing heavily in blockchain technology to deliver a cheaper, more efficient, transparent and secure system to manage the enormous growth expected in global logistics over the next decade. Moreover, YOJ in the March 2018 quarter, had successfully identified and secured key talent, deployed an all new platform and signed some key strategic accounts. The company is also focusing on converting the customer book into long term customer relationships and enabling the technology and processes to increase the speed by which new companies can adopt the technology. However, the blockchain technology is still in nascent stage and lot of work is going on towards the regulations. Therefore, based on the foregoing, we give a “Speculative Buy” recommendation on the stock at the current price of $ 0.155.

 

YOJ Daily Chart (Source: Thomson Reuters)

Disclaimer
 
The advice given by Kalkine Pty Ltd and provided on this website is general information only and it does not take into account your investment objectives, financial situation or needs. You should therefore consider whether the advice is appropriate to your investment objectives, financial situation and needs before acting upon it. You should seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) as necessary before acting on any advice. Not all investments are appropriate for all people. Kalkine.com.au and associated pages are published by Kalkine Pty Ltd ABN 34 154 808 312 (Australian Financial Services License Number 425376). The information on this website has been prepared from a wide variety of sources, which Kalkine Pty Ltd, to the best of its knowledge and belief, considers accurate. You should make your own enquiries about any investments and we strongly suggest you seek advice before acting upon any recommendation. Kalkine Pty Ltd has made every effort to ensure the reliability of information contained in its newsletters and websites. All information represents our views at the date of publication and may change without notice. To the extent permitted by law, Kalkine Pty Ltd excludes all liability for any loss or damage arising from the use of this website and any information published (including any indirect or consequential loss, any data loss or data corruption). If the law prohibits this exclusion, Kalkine Pty Ltd hereby limits its liability, to the extent permitted by law to the resupply of services. There may be a product disclosure statement or other offer document for the securities and financial products we write about in Kalkine Reports. You should obtain a copy of the product disclosure statement or offer document before making any decision about whether to acquire the security or product. The link to our Terms & Conditions has been provided please go through them and also have a read of the Financial Services Guide. On the date of publishing this report (mentioned on the website), employees and/or associates of Kalkine Pty Ltd do not hold positions in any of the stocks covered on the website. These stocks can change any time and readers of the reports should not consider these stocks as advice or recommendations.