ROSLYN, N.Y., Jan. 7, 2019 /PRNewswire/ -- Sino-Global Shipping
America, Ltd. (NASDAQ: SINO) ("Sino-Global", the "Company" or
"us"), a non-asset based global shipping and freight logistics
integrated solution provider, announced today that its Chief
Executive Officer, Mr. Lei Cao, released a Letter to
Shareholders highlighting current activities and outlining its
corporate strategy for 2019. The letter is included in its
entirety below:
To Our Valued Shareholders:
Over the course of fiscal year 2018, we continued to see
progress in building a larger customer base, due to the marriage of
Sino-Global's global shipping and transportation relationships and
a growing online logistics network. Our business has historically
been built around leveraging relationships with large shippers in
Asia and helping to serve these
clients through a variety of means, including arranging ship's
berthing and sailing, arranging cargo loading and unloading,
preparing clearance documents, among providing other services.
Over the past three years, through signing a strategic
cooperation agreement with COSCO Beijing, we were able to take
advantage of the low container rate to jointly promote bulk cargo
container transportation. COSCO adopted a new way to containerize
goods that used to be shipped in bulk ("bulk-to-container"). For
the year ended June 30, 2018, we
shipped 140 containers totaling 18 tons per container of sulfur
from Long Beach, CA in the U.S. to
our customers in China.
We are very proud of our accomplishments, as we developed our
business model to help connect China and the U.S. in a cost-effective manner.
Our investment in expanding our online platform and the
relationships we built here in the U.S. will prove to be valuable
assets in the coming years. As we enter fiscal year 2019, we expect
to pivot our business once again.
FY 2019 Strategy -- An Expansion of Our Shipping Agency
Business / Partnerships
The Background of Our Agency Business
To fully explain where Sino-Global is going, I feel it is
important for our investors and potential shareholders to
understand the origins of our company. I originally founded the
Company in 2001 to build a local shipping agency business to serve
local ports throughout China. At
the time of our initial public offering ("IPO") in 2008, we had
grown this business considerably to serving over 75 ports
throughout the country. We had strong customer relationships and
decided that the best way to continue growing the business would be
to utilize investors' capital to both grow our agency business and
to expand to ports outside of China. This would allow our company to develop
additional relationships and diversify its revenue stream. This was
the origin of "Sino-Global."
We had a strong set of relationships in building our agency
business, and in the years that followed our IPO, we were able to
develop new methods of simplifying the logistics process for our
clients. We used technology to more efficiently analyze information
about prospective shipments provided by our clients and to
determine the most economical and efficient transportation
solutions. We then leveraged our relationships and scale as a
shipping agency to negotiate competitive shipping rates.
The larger Chinese market served as an excellent market for
Sino-Global to expand into. It was large (having an estimated value
in 2006 of over $1.5 billion), highly
fragmented, and we had considerable expertise in serving a
long-term customer base. Our IPO allowed our company to both grow
within China and to build
relationships globally.
However, in 2013 we began to see challenges throughout the
market. There were two larger China State-Owned agencies that we
knew very well operating in the market, along with over 1,000
individual agencies that we were less familiar with. The number of
smaller agencies began to rise considerably, as they were appearing
on the market and attempting to win market share with
non-sustainable pricing. Instead of competing in such a market, we
decided to change our strategy. We developed a three-year strategic
plan to transform the Company and expand our focus to the global
market, instead of focusing solely on the Chinese market.
Initially, we were very successful in building a U.S.-based
revenue model. However, in mid-2018 we began to explore the
possibility of shifting the focus of our shipping agency business
once again due to two primary factors:
- After an examination of global trade policy, we found it to be
very challenging to build and expand a relationship/ technology
logistics business focused on China/U.S. relations. Current trade dynamics
made it more expensive for our shipping carrier clients to
cost-effectively move cargo into U.S. ports, and as a result, we
saw considerably lower shipping volumes. This included less
utilization of our online platform and ultimately led to declining
revenues in the latter half of fiscal year 2018.
- The shipping agency industry in China has improved dramatically. The number of
shipping agencies overall in the country has decreased, due to both
price and the inability of competitors to embrace technology as a
resource in serving clients' needs. We began to see this shift in
2017 and continued to monitor its progress on a quarterly basis
while operating our U.S. / China
business. We found that agencies are now able to compete based on
service and quality, as opposed to just price.
Growth Strategy - Shifting Back into the Agency Business, Now
Globally
We determined in mid-2018 to transition back into the shipping
agency business. We are still able to provide the same services as
before, but now we also have an integrated online logistics
platform that allows our company to handle a wider base of
customers in both China and other
ports throughout the globe.
As we moved back into the market, we saw a very favorable
response from our customer base and expect revenues to increase
considerably throughout the course of fiscal year 2019. Our
competitive advantages include:
- Having 20-years of experience in the shipping business;
- Maintaining stable long-term relationships with customers that
have tried "lower price" agency businesses, and thus value our
unique expertise and ease of their transactions and logistics
service when working with us;
- Being the only China-based
shipping agency listed on the NASDAQ in the United States;
- Being a standing council member of the CASA (China Association
of Shipping Agency & Non-Vessel-Operating Common Carriers);
and
- Having an online network that has been tested globally.
We believe that we can provide a full range of high quality
services to our clients through our global network of shipping
agency entities. We plan to establish our agency network in
China, Southeast Asia, and Australia over in the next three years. We
have selected major ports throughout China that we intend to target first and
expect to sign new partnership agreements with shippers in the
coming weeks/months.
Ancillary Growth Opportunities -- Container Trucking
Services
In addition to shipping agency expansion, we will seek out
additional opportunities for growth as they arise. An example
of this is a recent partnership with www.shippingchina.com
("Shipping China"), in which we will leverage their network to
expand our container truck services in the U.S. for freight
forwarding compartments. Shipping China is a leading
international shipping logistics business platform which was
launched in 2003 with about 300,000 contractors and 200,000 mobile
users.
We feel that by combining our transportation relationships with
the broad reach of Shipping China's portal we can expand a
container trucking network throughout the U.S.
Conclusion
On behalf of our board of directors and management, I thank you
for your continued confidence and interest in Sino-Global. We also
ask for your support for our transformation effort, allowing us
time and a stable environment to reshape our business model and
bring profitable returns for you, our shareholders.
Sincerely,
Mr. Lei Cao,
Chairman and CEO
For a current review of the Company and a copy of this letter,
management invites you to access it on the Company's website:
www.sino-global.com.
About Sino-Global Shipping America, Ltd.
Founded in the United States in
2001, Sino-Global Shipping America, Ltd. is a company engaged in
shipping, chartering, logistics and related business services.
Headquartered in New York,
Sino-Global has offices in Los
Angeles, mainland China,
Australia, Canada and Hong
Kong. The Company's current service offerings consist of
inland transportation management, freight logistics and container
trucking services. Additional information about Sino-Global can be
found on the Company's corporate website at www.sino-global.com.
The Company routinely posts important information on its
website.
Forward Looking Statements
No statement made in this press release should be interpreted as
an offer to purchase any security. Such an offer can only be made
in accordance with the Securities Act of 1933, as amended, and
applicable state securities laws. Any statements contained in this
release that relate to future plans, events or performance are
forward-looking statements that involve risks and uncertainties as
identified in Sino-Global's filings with the Securities and
Exchange Commission. Actual results, events or performance may
differ materially. Readers are cautioned not to place undue
reliance on these forward-looking statements, which speak only as
the date hereof. Sino-Global undertakes no obligation to publicly
release the results of any revisions to these forward-looking
statements that may be made to reflect the events or circumstances
after the date hereof or to reflect the occurrence of unanticipated
events.
Contact Information
The Equity Group Inc.
Adam Prior
(212)-836-9600 / aprior@equityny.com
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SOURCE Sino-Global Shipping America, Ltd.