Tech firm to raise £29m as losses widen

DJI Holdings, the Knutsford company which promotes and distributes Chinese sports and welfare lottery products, has announced a placing to raise £29m on the same day it reported a widening of losses to £10.7m.

Revenue dropped to £5.5min 2015, down from £47.5m in the previous year, whilst the group’s pretax loss widened to £10.7m from £4m after its  Chinese lottery-handling income dried up last year, following a state freeze on online sales.

Valued at around £200m, despite the revenue dip, DJI is now using its platform to support the Xinhua News Agency’s utility payments app. Nine of China’s ten largest provinces have signed to use it for collecting traffic fines, mobile top-ups and energy payments.

The group said the £29m share placing will fuel its move into China’s huge mobile payments market.

It follows a placing in April, which raised £10.5m to fund a “transformational deal”, working with Xinhuatong, the main operator of the Xinhua News App owned by China’s national news agency, to create an app for mobile payments and information.

Chief executive Darren Mercer said the app deal, which is targeting 300m Chinese users, is presenting more tie-ups for DJI, giving the company “considerable confidence and excitement” about the rest of 2016 and beyond.

He added that as a result of this and other key commercial relationships in China, the group is gaining access to significant opportunities to build additional revenue streams.

DJI also announced the appointment of Scott Kennedy  as its new chief financial officer, with effect from August 8.

Eversheds’ Danny Hall and Elizabeth Tindall advised the company on it’s share placing.

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