Finance CEO Zhiwei Zhao Speaking: industry integration has just begun

--Visit China Financial Online CEO

China Financial Online (NASDAQ:JRJC) (C.F.O) was founded in August 1999 and successfully landed on NASDAQ, USA, October 15, 2004. At present, C.F.O has a financial website, Shenzhen giant Spirit, securities star three sub brands.

But Zhiwei Zhao speaking, the CEO of China's financial online, is not the same as most IT companies ' CEOs. In the 14 months he has taken over the financial world, he has been keeping a low profile and the financial world in charge has faded out of the public eye. July and August this year, the financial sector has acquired the Shenzhen Juli Information Technology Co., Ltd. and the star of Securities, its supremacy in the industry has been basically established, at this time Zhiwei Zhao speaking finally can breathe a sigh of relief.

One afternoon in September 2006, in its office at the 9 floor of the Beijing International Enterprise Building, Zhiwei Zhao speaking the Shanghai Securities newspaper for the first time to reveal three changes in the financial sector over the past year.

From a start-up company to a public company

Shanghai Securities Daily: When you took over the financial sector has successfully completed the listing, this background left you beyond the space how many?

Zhiwei Zhao Speaking: financial capital has been very successful, but it has been affected by the environment, which leaves us with an opportunity to adjust to a real change from a start-up company to a public company.

Shanghai Securities Daily: Some people say that you have transformed the culture of leadership into a system culture.

Zhiwei Zhao Speaking: My predecessor, Ningjun, was a leader, and the culture of the company was also a leader culture. But when we are a listed company, we need a perfect system to protect. Fortunately, at present, our adjustment has been basically in place, and now we have a fairly unified understanding of the future development and corporate culture.

Shanghai Securities Daily: What does it mean for some senior executives to join the financial world? How will the financial sector balance the revenue from advertising and software sales?

Zhiwei Zhao speaking: From the beginning of Ningjun, China Financial online began to do stock market analysis software, the company has been its own site as a sales platform. But as the financial clout expands, so does the media's role, and we want to make it the best financial website in the country. Therefore, the financial sector to strengthen the content business and sales business development is not contradictory.

is still in the "primary" stage of the industrial chain

Shanghai Securities Daily: In the first quarter of this year, the financial sector's net profit was $97,000, down 92% from a year earlier, while the company's net profit for the second quarter was 442,000 dollars, down 56% from a year earlier. As CEO, what do you think of your performance after taking office?

Zhiwei Zhao Speaking: The company's performance has been related to China's securities market. The A-share market experienced a long bear markets. There is a question of accounting standards as to why financial performance has not been synchronized with China's securities market. According to the U.S. accounting standards, our current software sales revenue within 12 months of the split, so the performance of a certain delay. So we've had a drop in the first two quarters of this year, actually more affected by the previous year. In recent months, the financial sector has seen a pick-up in sales. These will be reflected in future statements.

Shanghai Securities Daily: Since the big environment has changed, the previous profit model also apply, where will the future growth?

Zhiwei Zhao Speaking: in the financial services industry, we just do software tools and information, this is only a small part of the entire industry chain, it is still very elementary, as the further development, we will find more market opportunities and more effective business model.

From the act of low-key to the industry overlord

Shanghai Securities Daily: Some time ago, the financial sector spent 9 million of dollars, has acquired the Shenzhen giant Spirit and the star of securities, such a large amount of what is the consideration? What can be promoted to the development of the company?

Zhiwei Zhao Speaking: Our financial information database is outsourced, and all our products are based on the database. Once there is a problem, our service to our customers will be interrupted. Therefore, from the angle of risk avoidance, from the angle of perfecting the industrial chain, we must buy a company that specializes in financial and financial database. So we found the Shenzhen giant Spirit, it has a good foundation, there are a large number of institutional clients. Therefore, the financial sector, by virtue of such an opportunity, has not only established its own database, but also entered the institutional market directly.

And the star of the purchase of securities is mainly for the needs of market integration. The financial world's users are mainly in the north, while the securities star is located in Shanghai, its customers are mainly concentrated in Jiangsu and Zhejiang area. After the completion of the acquisition, more than half of China's most active investors have become our customers, our market position has been preliminarily established.

After two acquisitions, we have bases in Beijing, Shanghai and Shenzhen, the three most economically developed regions. This layout is good for the development of the company.

Shanghai Securities Daily: After eating two companies in one breath, how will China's financial online Digest?

Zhiwei Zhao Speaking: I will keep three brands at the same time, considering the different preferences of the audience. Three companies to fight together. For example, Dow Jones, which has more than 100 brands, each brand is the leading company in the market segment, I think China Financial online will also be the model.

Shanghai Securities Daily: Does this analogy mean that China's financial online has a further takeover plan?

Zhiwei Zhao Speaking: In the long run, our acquisition of the Giants and the stock of securities is just the beginning, and the company's real development requires a lot of integration. Industry has developed for so many years, has entered the integration stage, the financial sector has already had a strong competitive advantage.