HONG KONG, Jan. 4, 2021 /PRNewswire/ -- CLPS Incorporation (Nasdaq: CLPS) ("CLPS" or "the Company"), today released a letter to shareholders from the Chairman of the Company's Board of Directors (the "Board"), the full text of which is provided below. All CLPS shareholders are encouraged to read it.
On behalf of the Board, I wish you a happy and safe new year!
In 2020, CLPS celebrated its 15th anniversary since its establishment. It was also a challenging year that forced most people to adopt to new realities. Despite this unprecedented year, we remained on track with our growth strategy such as global business expansion, continuous talent supply development, successful mergers and acquisitions, and technological innovation progress which further improved our operational efficiency.
Let us look back at the highlights of the Company's performance in 2020.
1. Client Base and Revenue Growth
Despite macroeconomic effects during this period, CLPS has maintained double-digit annual revenue growth and its net income attributable to CLPS Incorporation's shareholders has turned profitable. In fiscal 2020 financial results, the revenue increased by 37.7% to $89.4 million in the same period of the previous year. The revenues by geography were also improved. The year-over-year revenues generated from Singapore, Hong Kong, and Mainland China have increased by 191.8%, 56.6%, and 30.5%, respectively.
The gross profit increased by 31.0% to $31.1 million, and net income attributable to CLPS Incorporation's shareholders was $2.9 million, or $0.20 basic and diluted earnings per share, compared to net loss attributable to CLPS Incorporation's shareholders of $3.3 million, or $0.24 basic and diluted losses per share in the prior year period. Non-GAAP net income attributable to CLPS Incorporation's shareholders increased by 85.3% to $6.9 million.
In 2020, CLPS gained more overseas and domestic clients and project-based contracts from the financial services and IT industries.
In IT consulting services, CLPS increased its client-base in international banks, credit card, trust, futures, payment system, internet services, e-commerce, smart logistics, intelligent vehicle, and semiconductor, among other industry. In November 2020, CLPS won the IT services provider bid for a well-known bank card processing services company in China.
In customized IT solution services, CLPS actively explored new business opportunities with its existing clients. It recently signed a deal with a leading Chinese state-owned automotive company for big data-enabled vehicle intelligent manufacturing system project.
2. Talent Supply
As CLPS's edge among other competitors in the IT services market, we have been able to develop and maintain the talent supply chain in order to meet the demand of our clients.
CLPS has been cooperating with the Technological and Higher Education Institute of Hong Kong ("THEi") to boost its degree program in information technology. In addition, we established the Cooperative Education on Information Technology Program ("Coop Program") in partnership with Hong Kong Multimedia Design Association ("HKMMDA"), a non-profit organization in Hong Kong, in which more than 20% of the first batch of qualified trainees have been placed to local banks.
Our achievements under the Talent Creation Program (TCP) and Talent Development Program (TDP) have been and will continue to be an important component in solving through the bottleneck of IT services market and talent supply shortage. Our talent programs are among the important drivers of the Company's business growth in the international and domestic markets.
3. Research and Development Efforts
CLPS renamed its research center, the CLPS Research, to CLPS Innovation Lab. It has been dedicated to the research and application of innovative technologies, including distributed application systems, cloud computing, micro services, open API, robotic process automation (RPA), and big data, among other technologies. CLPS Innovation Lab focuses on continuous scientific and technological innovation to provide clients with more comprehensive and efficient IT services.
In the past year, we implemented RPA and big data into our internal human resources, financial, and operational management systems, which significantly improved the Company's overall operation. In addition, CLPS's recruitment center in the Mainland China launched in early 2020 is equipped with advanced technologies, such as cloud platforms, big data, and RPA to accelerate the talent acquisition process, thereby reducing operational cost.
CLPS's RPA has supported its clients' digital transformation, including the successful distribution into the application scenarios in the accounting, credit investigation, procurement, and logistics, among other processes for some large state-owned and pharmaceutical enterprises. As a result of RPA achievements, we have received positive feedback from our clients.
4. Streamlined Organizational Structure
CLPS has streamlined its corporate governance and organizational structure to better implement its global expansion strategy.
CLPS relocated its global corporate headquarters to Hong Kong, and set up Shanghai and Singapore as its regional headquarters in the Mainland China and Southeast Asia, respectively. We also set up our California subsidiary and expanded the fintech business development services opportunities in the Asia-Pacific and the US markets following the international business standards and services.
With more than ten years of experience in the credit card service industry, we set up a wholly-owned subsidiary, Qinson Credit Card Services Limited ("QCC"), to cater to the credit card service demands of the financial industry. In one-year period, QCC has attained its stature in the credit card industry, and it continuously develops more business opportunity. At present, its client base consists of well-known international and large banks, bank card associations, and international financial IT companies.
5. Mergers and Acquisitions
CLPS continued to advance its mergers and acquisitions efforts in Mainland China and globally. We recently acquired the remaining 20% ownership stake in Ridik Pte. Ltd. ("Ridik"). As a wholly owned subsidiary, Ridik will enable us to fully integrate our business in the Southeast Asia region and to further advance our business expansion in the global market.
In Mainland China, we invested in Shenzhen Huaqin Robotics and Guangdong Zhichuang Software Technology to diversify our service offerings in robotics, semiconductor, and other industries. Our investment initiatives will put us in a position to expand our business overseas and to better serve our clients going forward.
The COVID-19 outbreak has brought significant impact to the global economy. However, it accelerated the digitization and informatization of traditional industries. Post-pandemic, it is forecasted that majority of enterprises will pivot to technology platforms and will venture on digital transformation. In 2021, we expect growing demand for global financial IT services and solutions, as well as for IT talents in cutting-edge technology domain such as artificial intelligence (AI), blockchain, big data, and cloud applications.
Looking forward to 2021, we are dedicated to investing for resources based on our expertise in financial IT services and solutions in China and globally, advancing our competitive advantage, reaching global market business opportunity, and providing efficient IT services to our existing and potential clients. Our streamlined technological and management innovations will drive the Company to achieve higher quality development and bring long-term value to our shareholders. On behalf of the CLPS family, I extend my gratitude to our shareholders' unwavering support and confidence in the Company. We hope all of you to stay healthy and safe during these challenging times.
With sincerity and determination,
Xiao Feng Yang
Chairman of the Board
About CLPS Incorporation
Headquartered in Hong Kong, CLPS Incorporation (the "Company") (Nasdaq: CLPS) is a global leading information technology ("IT"), consulting and solutions service provider focusing on the banking, insurance and financial sectors. The Company serves as an IT solutions provider to a growing network of clients in the global financial industry, including large financial institutions in the US, Europe, Australia, Southeast Asia and Hong Kong, and their PRC-based IT centers. The Company maintains 18 delivery and/or research & development centers to serve different customers in various geographic locations. Mainland China centers are located in Shanghai, Beijing, Dalian, Tianjin, Baoding, Chengdu, Guangzhou, Shenzhen, Hangzhou, and Suzhou. The remaining eight global centers are located in Hong Kong SAR, USA, UK, Japan, Singapore, Malaysia, Australia, and India. For further information regarding the Company, please visit: http://ir.clpsglobal.com/, or follow CLPS on Facebook, LinkedIn, and Twitter.
Certain of the statements made in this press release are "forward-looking statements" within the meaning and protections of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include statements with respect to the Company's beliefs, plans, objectives, goals, expectations, anticipations, assumptions, estimates, intentions, and future performance, and involve known and unknown risks, uncertainties and other factors, which may be beyond the Company's control, and which may cause the actual results, performance, capital, ownership or achievements of the Company to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. All such statements attributable to us are expressly qualified in their entirety by this cautionary notice, including, without limitation, those risks and uncertainties related to the Company's financial and operational performance in the second half and full year of fiscal 2020, its expectations of the Company's future performance, its preliminary outlook and guidance offered in this presentation, as well as the risks and uncertainties described in the Company's most recently filed SEC reports and filings. Such reports are available upon request from the Company, or from the Securities and Exchange Commission, including through the SEC's Internet website at http://www.sec.gov. We have no obligation and do not undertake to update, revise or correct any of the forward-looking statements after the date hereof, or after the respective dates on which any such statements otherwise are made.