Ann: Vmoto to Expand Manufacturing Capacity with New Facilities, page-48

Hi MTV

Super Soco

I don't think Super Soco are in any position to cause trouble.

In 2022 they only purchased $1,176,000 worth of bikes from the JV so no chance of any profit from distribution in China and their share of the JV loss was $1.3m .

The first half of 2023 we don't know what their Chinese sales were but do know their loss in the JV increased from $546k to $811K

Their fate was sealed when they gave the JV the exclusive right to use their Brand, Patents and Moulds and gave Vmoto exclusive rights to distribute Super Soco Branded products everywhere except china.

Since their dummy spit in 2021 when they realised a merger with VMT wasn't on VMT's agenda they have disappeared into the either.

With Emax airbrushed out of the VMT picture following the relaunch of the Vmoto Brand the JV lost a major portion of its revenue which dropped from $33m to $20m in the last 12 months causing the $1.6m loss in H1/23.

Vmt have been financially supporting the JV. Vmt have contributed all their $5.9m of equity and the JV owed them $5.5m at the end of last year which was due for repayment in August.

VMT's carrying value for their 50% of the JV is down to $4.8m after the carried forward losses. The other half of the JV nett assets appears to be non current assets which are likely to be loans to Super Soco to cover their equity contributions and losses which fall due in June 25


Where to from here:

It's hard to see a way forward for Super Soco. Their days of raising capital to fund their losses are over and they have nothing of value left.

My guess is they will fold and VMT will pick up the pieces.