Kingdee expects sales to reach 1.5 bln yuan in 5 yrs

HONG KONG (AFX-ASIA) - Kingdee International Software Group Co Ltd chairman Robert Xu said he expects the company's annual sales to reach 1.5 bln yuan in five years on the back of an expansion scheme.

	    "Five years from now, I expect enterprise resource planning (ERP) software products and customer relationship management products will become the company's major revenue sources," Xu said.

	    "With rising demand for software in China, I think Kingdee will be able to reach the sales target of 1.5 bln yuan since products under the brandname Kingdee have become well known there," Xu said.

	    In 2000, Kingdee posted sales of 164.8 mln yuan.

	    Xu said the company will raise its research and development spending to boost its competitiveness.

	    "We will boost R&D spending to 10-12 pct of annual sales in five years from the current 9 pct," Xu said.

	    Xu said the company is expected to sign some investment agreements by the end of this year.

	    "I went to the U.S. earlier this year for negotiations about future investments. It is likely that we will be able to carry out some investment projects by the end of this year," Xu said.

	    He added he does not rule out the possibility of expansion through acquisitions or mergers.

	    Xu said currently, ERP products account for about 50 pct of the company's total sales. 

	    He said gross margin of the company's K/3 ERP series reached about 80 pct.

	    Meanwhile, Kingdee has signed an agreement to supply its Apusic middleware products to Legend Holdings.

	    Xu said while the value of the agreement is not significant, "that will be the first step of cooperation with Legend".

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