HONG KONG, Dec 24, 2019 - (ACN Newswire) - Wise Ally International Holdings Limited ("Wise Ally" or the "Company", together with its subsidiaries, collectively referred as the "Group") announced today the details of the proposed listing of its shares (the "Global Offering") on Main Board of The Stock Exchange of Hong Kong Limited ("HKEx").

Investment Highlights- Highly integrated and comprehensive range of services across the consumer EMS value chain coupled with capabilities to manufacture a diversified product range and an efficient production process - Strategic collaborations, stable and established business relationships with internationally renowned and industry-leading brand owners- Strong technical expertise and product development capability which facilitate its business expansion into new markets- Strong commitment to attain high quality in the manufacturing process

Wise Ally plans to offer a total of 500,000,000 shares, subject to the over-allotment option, comprising 50,000,000 Hong Kong Offer Shares and 450,000,000 International Placing Shares, at an Offer Price ranges between HK$0.25 and HK$0.31 per Offer Share. The Hong Kong Public Offering will open at 9:00 a.m. on Friday, 27 December 2019 and close at 12:00 noon on Thursday, 2 January 2020. The allotment results will be announced on Thursday, 9 January 2020. Dealings in shares on HKEx are expected to commence on Friday, 10 January 2020, under the stock code 9918.HK.

WAG Worldsec Corporate Finance Limited is the Sole Sponsor. Huajin Securities (International) Limited, Aristo Securities Limited and CEB International Capital Corporation Limited act as the Joint Global Coordinators, Joint Bookrunners and Joint Lead Managers in relation to the Global Offering.

Wise Ally has entered into cornerstone investment agreements (the "Cornerstone Investment Agreements") with two cornerstone investors (the "Cornerstone Investors"). Pursuant to the Cornerstone Investment Agreements, the Cornerstone Investors have agreed to, subject to certain conditions, subscribe for a certain number of the Offer Shares at the Offer Price, with an aggregate amount of approximately HK$40.0 million (the "Cornerstone Placing"). The Offer Shares under the Cornerstone Placing are subject to a restriction on disposal for a period of six months following the Listing Date.

Company Overview

Wise Ally is an established electronics manufacturing services ("EMS") provider offering full turnkey solutions to its customers with particular focus in consumer electronic products. Wise Ally provides a comprehensive range of services including design development and enhancement, provision of technical advice and engineering solution, selection and procurement of materials, production, quality control and logistics management.

According to the Euromonitor Report, Wise Ally is the only unlisted company within the top 15 consumer EMS providers in China in terms of revenue in 2018. The Group's solutions aim to combine electronic components (such as microcontroller and microprocessor embedded with software and PCB) and mechanical and electromechanical components to form a multifunctional module to facilitate the overall function of the finished electronic products of the customers. The deliverables of Wise Ally's manufacturing services include PCBAs, multifunctional modules and finished electronic products, covering a range of product applications including vapour products, appliances, commercial controls and HVACs.

Business Model

As an EMS provider that provides integrated services to its customers, the Group provides customers with not only manufacturing service, but also value-added services at various stages along the supply chain ranging from product development, product design optimisation, prototyping, material procurement, production management, quality control to logistics and delivery.

Wise Ally places particular focus on the product development process, which allows the Group to initiate product designs with its customers and collaborate and interact with them on product development and product design optimisation, which the Group believes could help to ensure the functionality of the products and commercial viability of mass production for its customers.

Financial Highlights

The Group's total revenue for each of the years ended 31 December 2016, 2017 and 2018, was HK$687.7 million, HK$1,232.7 million and HK$1,257.3 million, respectively, representing a CAGR of 35.2% over the three years. The Group's revenue for the six months ended 30 June 2019 amounted to HK$527.6 million.

As a result of the increase in revenue contribution from vapour products which entailed relatively higher gross profit margin and certain new product with application in vapour products which entailed relatively higher gross profit margin than the other product applications, the Group's gross profit and gross profit margin increased from HK$135.7 million and 19.7% for the year ended 31 December 2016 to HK$295.6 million and 23.5% for the year ended 31 December 2018, respectively. The Group's gross profit and gross profit margin for the six months ended 30 June 2019 was HK$122.7 million and 23.3% respectively.

The Group's profit for the year/period amounted to HK$1.0 million, HK$74.2 million, HK$77.0 million and HK$18.4 million for the years ended 31 December 2016, 2017 and 2018 and the six months ended 30 June 2019, respectively, representing net profit margin of 0.1%, 6.0%, 6.1% and 3.5%, respectively. Excluding the non-recurring listing expenses of HK$9.0 million for the six months ended 30 June 2019, the Group's net profit for the periods would amount to HK$27.4 million.

Competitive Strengths

Unlike traditional manufacturers which only focus on certain stages of the production process, Wise Ally offers an integrated and comprehensive range of services across the mid-to-down stream of the consumer EMS value chain. The highly integrated EMS business model has helped positioning the Group as a product development partner of its customers and a value-creator at the front-end of the supply chain to manufacture a diversified product range.

Besides, Wise Ally has strategic collaborations, stable and established business relationships with internationally renowned and industry-leading brand owners. This is a testament to Wise Ally's competitive qualities such as good quality control, strong product development capability and solid technical knowhow. The Group believes that the ability of Wise Ally to attract new customers and to tap into new markets is attributable to its established collaborative relationships with industry-leading players which has enhanced its corporate profile and reputation and also enables it to obtain a stable flow of orders and ensures a source of recurring revenue.

Wise Ally is dedicated to differentiating itself to explore business opportunities in new markets with high growth potential by leveraging on its strong technical expertise and product development capability. The Group's core competence in electrical and electronic engineering design, especially module design, software and firmware development and wireless product design have enabled it to provide one stop customised EMS solutions to the customers. The Group believes that its deep understanding of the consumer EMS industry and technical expertise as well as its strong product development capability enable it to offer solutions to the customers from diverse industries and to keep pace with the constantly evolving technologies in the consumer EMS industry, and that the Group's technical expertise would also facilitate its development of future products which would in turn help broaden its product portfolio and allow it to tap into new market segments.

Wise Ally also has a strong commitment to attain high quality in the Group's manufacturing process. Going forward, the Group view its growth to be driven primarily by the continued trend for brand owners to outsource their manufacturing activities to EMS providers and the rapid development and popularisation of IoT related solutions and the Group are dedicated to differentiating itself to explore business opportunities in new markets with high growth potential by leveraging on the Group's strong technical expertise and product development capability. The Group adopts the principles of total quality management (TQM) and provides on-going training to the Group's staff in terms of quality assurance. In addition, the Group maintains stringent quality assurance and inspections throughout the manufacturing process from the procurement of materials to conducting incoming quality assurance of materials to performing in-process inspections during production and outgoing quality assurance of finished electronic products. Moreover, the Group developed an in-house traceability record system. All products are labelled with codes during the production process. Wise Ally's stringent quality assurance regime has altogether enabled the Group to deliver consistent and reliable products and services to the Group's customers in a cost-efficient manner.

According to the Euromonitor Report, the global EMS industry is forecasted to grow at a CAGR of more than 5% between 2019 to 2023. For China market, the consumer EMS industry is expected to grow with a CAGR of 7.6% between 2019 and 2023, driven by the rapid development of the IoT, the optimisation of operations and resources through industry consolidation and the continuous support from national industrial policies. For the EU market, the total revenue of the consumer EMS industry in the EU is forecast to grow slightly faster between 2019 and 2023 than it did between 2014 and 2018, at a CAGR 1.2%, to reach EUR5.5 billion in 2023. The growth of industry will be driven by strong consumer demand for electronics in the EU, and strong performances by consumer EMS companies in Central and Eastern Europe. For the US market, the revenue of consumer EMS products will continue to be driven by demand for more advanced technologies and products related to smart homes, the IoT, healthcare, mobile phones, computers and other smart devices. The consumer EMS industry is expected to grow from USD52.7 billion in 2019 to USD57.4 billion in 2023, registering a CAGR of 2.2%. Leveraging on the aforementioned growing demand in consumer EMS industry, the Group intends to continue to strengthen its leading position in the consumer EMS industry, enhance its overall competitiveness and increase its market share in the future.

Mr. Chu Wai Hang Raymond, Chairman & Executive Director of Wise Ally says, "We are pleased to witness this significant milestone in the Group's history. Through our listing on the Main Board of HKEx, we will tap into the international capital markets. This will not only broaden our capital and shareholder base, but also provide us with capital to fund our expansion plan, which will finally strengthen our position in the industry and further enhance our competitive advantages, thereby driving the Group's long-term development."

For media enquiries, please contact Bright Communications International Limited:Ms. Betty DongTel: (852) 2555 0230Mobile: (852) 9666 8657Email: betty.dong@brightcommns.com

Mr. Benjamin LiTel: (852) 2555 0230Mobile: (852) 6970 0779Email: benjamin.li@brightcommns.com

Factsheet

Details of Share Offer:Number of Offer Shares: 500,000,000 Shares (subject to Over-allotment Option)Number of Hong Kong Offer Shares: 50,000,000 Shares (subject to reallocation)Number of International Placing Shares: 450,000,000 Shares (subject to reallocation and the Over-allotment Option)Offer Price Range: Between HK$0.25 and HK$0.31 per Offer ShareBoard Lot Size: 8,000 SharesNominal Value: HK$0.01 per SharePublic Offer Period: 9:00 a.m. Friday, 27 December 2019 to 12:00 noon Thursday, 2 January 2020Announcement of Allotment Results: Thursday, 9 January 2020Expected Listing Date: Friday, 10 January 2020Stock Code: 9918.HK

Use of Proceeds:

The aggregate net proceeds from the Global Offering (after deducting underwriting fees and estimated expenses payable by the Group in connection with the Global Offering), assuming an Offer Price of HK$0.28 per Offer Share, being the mid-point of the indicative Offer Price range of HK$0.25 to HK$0.31 per Share, will be approximately HK$93.5 million, assuming that the Over-allotment Option is not exercised. The Group currently intend to apply the net proceeds from the Global Offering in the following manner:

Use of Proceeds / % of Net Proceeds- Increasing production capacity by expanding the Group's manufacturing platform in South East Asia region and the PRC: approximately 35.0%- Enhancing production efficiency and capability by acquiring new machinery and equipment and upgrading the production facility at the Group's existing Dongguan Production Plant: approximately 26.3%- Strengthening the Group's research capability for the development and provision of IoT related solutions: approximately 5.5%- Increasing the Group's marketing efforts in North America and Europe: approximately 5.8%- Upgrading the Group's information technology infrastructure and manufacturing execution system ("MES"): approximately 3.5%- Repayment of a capital expenditure bank loan: approximately 14.5%- Funding the Group's general working capital: approximately 9.4%

Track Record:

HK$'000 Year ended 31 December Six months ended 30 June 2016 2017 2018 2018* 2019Revenue 687,659 1,232,653 1,257,295 709,535 527,594Gross profit 135,717 252,379 295,637 170,309 122,688Gross profit margin 19.7% 20.5% 23.5% 24.0% 23.3%Profit before tax 611 91,777 96,159 61,092 23,662Profit for the year/period 982 74,172 77,018 49,420 18,449Net profit margin 0.1% 6.0% 6.1% 7.0% 3.5%*Unaudited

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