With additional analysis from Simon Huang

Ficus Asia Investment, a Vietnam “new retail” group that has drawn significant funding from Alibaba’s eWTP Capital, has seen its revenue decline from US$176 million in 2019 to nearly US$157 million in 2020, according to its filings with Singapore’s Accounting and Corporate Regulatory Authority (ACRA).

It also experienced an uptick of 52% in net loss, which increased to US$38 million in 2020 from US$25 million in the previous year.

Ficus told Tech in Asia that the revenue decline was due to the impact of Covid-19. However, the company explained that the increase in net loss was only about US$3 million due to differences in calculating its finance cost.

The group, which is registered in Singapore, holds interests across retail, logistics, and technology ventures in Vietnam.

Many of its subsidiaries such as The Coffee House (a coffee chain) or Juno (a manufacturer of shoes and handbags) relied heavily on offline activities that took a hit due to the Covid-19 pandemic.

On the positive side, Tech in Asia’s analysis also showed that Ficus experienced an improvement in its cash flow generated from operations, from negative US$2 million in 2019 to positive US$12 million in 2020.

The divergence between Ficus’ accounting loss and positive cash flow from operations is due to two main adjustments that are added back to the net loss figure. The first is the US$27 million in depreciation and amortization expenses, and the second is the US$26 million in accretion of interest expenses.

Both are non-cash expenditures that do not directly impact Ficus’ cash flow from operations in 2020.

This means that despite the negative income for the year, Ficus’ underlying business operations are actually healthier and generated more cash in 2020 than the year before.

Ficus is chaired by Dinh Anh Huan, who made his fortune from founding Thegioididong (or Mobile World), Vietnam’s leading electronics retailer.

Last year, Tech in Asia first reported that Ficus received a US$50 million investment from Alibaba-backed eWTP Capital through the fund’s Singapore entity, Redefine Capital Fund.

Since then, eWTP Capital has put another US$10 million into Ficus, according to a recent DealStreetAsia report.

Ficus’ financial statement for 2020 shows that the group has increased its stakes in various companies. It shelled out US$7 million on investments in associates (companies it has a stake in but does not own a majority of) and US$13 million on acquiring subsidiaries (companies it has a majority stake in).

In 2020, Ficus’ holding entity, Seedcom, acquired more shares in the group’s portfolio companies such as The Coffee House, Juno, and Haravan (a software-as-a-service provider that is considered Vietnam’s Shopify).

Notably, Ficus attained majority control of Haravan and Juno following these transactions (it already owned a majority of The Coffee House at the time). This would give Seedcom – and Ficus – a greater say in how these businesses would be run going forward.

In an email statement to Tech in Asia, Dinh explained that The Coffee House, Juno, and Haravan are part of Seedcom’s new retail strategy to build an ecosystem of businesses that serve both end users and business-to-business platforms in retail.

Following this strategy, Seedcom pumped more money into The Coffee House in 2020. The chain, which recorded a revenue of US$37 million in 2019, has started working with third-party delivery apps to adapt to Covid-19 restrictions, even though it resisted the move initially in order to be more independent.

Another notable venture in Seedcom’s portfolio is Scommerce, an ecommerce logistics company that drew a US$100 million funding round in 2019 led by Singapore state fund Temasek.

Scommerce, however, saw its revenue fall from US$103 million in 2019 to US$91 million in 2020. Tech in Asia previously analyzed in this report how Scommerce, which specializes in last-mile express and on-demand delivery in Vietnam, has to face tough foreign competition from the likes of Ninja Van, J&T Express, and Sea Group-owned Giaohangtietkiem.

Scommerce had briefly experimented with its own food delivery service called LaLa in 2017 before shutting it down shortly after. Its cross-border component Gido was also reportedly closed by the end of last year.

Alibaba-backed funds have been fairly active in Vietnam lately. Besides eWTP Capital, BAce Capital also invested in insurtech startup Papaya earlier this year, and it recently co-led a US$12 million round in Vietnamese ecommerce-focused logistics firm Loship.

Along with Hong Kong-based Baring Private Equity Asia, Alibaba itself participated in a US$400 million investment in Vietnam’s Masan Group in May. The funding aims to boost the capacity of Lazada – also owned by Alibaba – in the online groceries business.