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Highlights for First Quarter 2018:
- GMV1 reached
RMB1,119.5 million (US$178.5 million ) for Q1 2018, representing an increase of 43.2% from Q1 2017. - Total number of orders2 was 306.1 thousand for Q1 2018, representing an increase of 45.3% from 210.7 thousand for Q1 2017.
- Number of active customers3 increased by 56.1% to 160.9 thousand for Q1 2018.
- Total net revenues reached
RMB802.5 million (US$127.9 million ), increasing by 42.8% fromRMB562.0 million for Q1 2017. - Net income increased by 10.2% to
RMB25.9 million (US$4.1 million ) for Q1 2018 fromRMB23.5 million for Q1 2017. - Non-GAAP net income4 increased by 46.8% to
RMB34.5 million (US$5.5 million ) for Q1 2018 fromRMB23.5 million for Q1 2017. - Basic and diluted net income per share was
RMB1.02 (US$0.16) andRMB0.97 (US$0.15) , respectively, for Q1 2018, compared to basic and diluted net loss per share ofRMB33.70 andRMB33.70 , respectively, for Q1 2017. Basic and diluted net income per American Depositary Share ("ADS") wasRMB0.51 (US$0.08) andRMB0.49 (US$0.08) , respectively, for Q1 2018, compared to basic and diluted net loss per ADS ofRMB16.85 andRMB16.85 , respectively for Q1 2017. Two ADSs represent one ordinary share. - Basic and diluted non-GAAP net income per share5 was
RMB1.36 (US$0.22) andRMB1.31 (US$0.21) , respectively, for Q1 2018, compared to basic and diluted non-GAAP net income per share ofRMB3.14 andRMB1.12 , respectively, for Q1 2017. Basic and diluted non-GAAP net income per ADS wasRMB0.68 (US$0.11) andRMB0.65 (US$0.10) , respectively, for Q1 2018, compared to basic and diluted non-GAAP net income per ADS ofRMB1.57 andRMB0.56 , respectively, for Q1 2017.
_________________________
1 GMV is to the total value of all orders of products and services, excluding the value of whole car sales, placed on our online platform and in our offline experience centers, regardless of whether the products are delivered or returned or whether the services are cancelled during the quarter.
2 Total orders are to the total number of orders of products and services, excluding the number of whole car sales, placed on our online platform and in our offline experience centers, regardless of whether the products are delivered or returned or whether the services are cancelled during the quarter.
3 Active customer is customer through whose account that made at least one purchase during the period.
4 Non-GAAP net income is a non-GAAP financial measure, which is defined as net income, excluding share-based compensation expenses. See “Reconciliation of GAAP and Non-GAAP Results” at the end of this press release.
5 Basic and diluted non-GAAP net income per share is a non-GAAP financial measure, which is defined as non-GAAP net income, divided by weighted average number of basic and diluted outstanding, including the dilutive effect of share-based awards as determined under the treasury stock method. Basic and diluted Non-GAAP net income per ADS is equal to basic and diluted non-GAAP net income per share divided by two as two ADSs represent one ordinary share.
Commentary
Mr. Richard Rixue Li, Chairman and Chief Executive Officer of
“For the first quarter of 2018, we have been consistently making steady progress in the strategy of our brand network expansion with world-renowned luxury brand partners to provide an ever-greater product portfolio for our customers,” continued Mr. Li. “Our expansion into the organic agriculture sector as well as the further enhancement, both in quantity and quality, of our high-end travel services are further testaments to our commitment to providing our customers with a full-spectrum of lifestyle service offerings. We’re devoted to leveraging both our online and offline capabilities to build a premium lifestyle platform to maximize our coverage to better serve our customers.”
Mr. Li concluded, “The first quarter of 2018 was a fruitful quarter for
“We are happy to report a strong financial performance in the first quarter of 2018, which underscored our solid growth trajectory,” said Mr.
Recent Developments
- In the first quarter of 2018,
Secoo expanded direct collaborations with 83 brands, including Canali, Philipp Plein and Versace Porcelain. - In
March 2018 , during the 2018 Shanghai International Fashion Week,Secoo formed the strategic partnership with the Top 100Global Designers Alliance (the “Top 100”) and renowned fashion show host, Ontimeshow. Through these partnerships, more than 300 indie designers associated with Top 100 and Ontimeshow opened or will open online stores on Secoo’s designer channel. - In
March 2018 ,Secoo entered a strategic cooperation with the successful organic brand “Chu Orange.” Through the cooperation,Secoo purchases its brand-tailored Chu’s tangerines from the product origin. This cooperation marks Secoo’s first expansion into the agriculture sector aligning with four quality criteria thatSecoo advocates: product origin, limited production, organic, and premium quality. - In
March 2018 ,Secoo formed a strategic partnership with Caissa Travel (“Caissa”). Leveraging both parties’ resources and expertise,Secoo and Caissa will jointly design luxurious tourism products to be listed on Secoo.com. This also signals Secoo’s cross-sector expansion into the lifestyle travel industry. - In
April 2018 ,Secoo entered a strategic cooperation with aChina's leading outlets mall operator,Capital Outlets , to integrate both parties’ respective resources, build an online and offline omni-channel sales service network to expand Secoo’s new retail network. - In
April 2018 ,Secoo announced to cooperate with renowned artistEdison Chen and his fashion brand, Emotionally Unavailable “EU”, to launch limited-edition merchandises designed byEdison Chen . These merchandises will be made exclusively available on Secoo.com for its 10th anniversary onJuly 7, 2018 . - In
April 2018 ,Secoo formed a strategic partnership withSri Lanka National Tourism Department to jointly launch “Love in Sri Lanka” tourism products tailored for tourists pursuing for high-quality travel.
First Quarter 2018 Financial Results
GMV increased by 43.2% to
Total number of orders increased by 45.3% to 306.1 thousand for the first quarter of 2018 from 210.7 thousand for the first quarter of 2017.
Total net revenues for the first quarter of 2018 increased by 42.8% to
Cost of revenues increased by 44.2% to
Gross profit increased by 36.2% to
Operating expenses increased by 48.8% to
Fulfillment expenses increased by 73.2% to
Marketing expenses increased by 69.5% to
Technology and content development expenses increased by 58.0% to
General and administrative expenses decreased by 44.0% to
Operating income for the first quarter of 2018 was
Non-GAAP operating income, which excludes share-based compensation expenses, increased by 33.5% to
Income tax expenses were
Net income was
Non-GAAP net income, which excludes share-based compensation expenses, increased by 46.8% to
Net income attributable to ordinary shareholders of
Basic and diluted net income per share was
Basic and diluted non-GAAP net income per share was
Cash, Time Deposits and Restricted Cash
As of
Second Quarter 2018 Guidance
The Company currently expects total net revenues for the second quarter of 2018 to be in the range of
The above outlook is based on the current market conditions and reflects the Company’s current and preliminary estimates of market and operating conditions and customer demand, which are all subject to substantial change.
The Company’s ability to achieve these projections is subject to risks and uncertainties. See “Safe Harbor Statement” at the end of this press release.
Conference Call Information
The Company's management will host an earnings conference call at
Dial-in details for the earnings conference call are as follows:
United States: | +1-845-675-0437 |
International: | +65-6713-5090 |
Hong Kong: | +852-3018-6771 |
China: | 400-620-8038 |
Conference ID: | 2897611 |
Additionally, a live and archived webcast of the conference call will be available on the Company's investor relations website at http://ir.secoo.com.
A replay of the conference call will be accessible approximately two hours after the conclusion of the live call until
United States: | +1-646-254-3697 |
International: | +65-2-8199-0299 |
Hong Kong: | +852-3051-2780 |
China: | 400-632-2162 |
Replay Access Code: | 2897611 |
About
For more information, please visit http://ir.secoo.com
Use of Non-GAAP Financial Measures
To supplement our consolidated financial statements which are presented in accordance with U.S. GAAP, we also use non-GAAP net income and basic and dilutive non-GAAP net income per share and ADS as additional non-GAAP financial measures. We present these non-GAAP financial measures because they are used by our management to evaluate our operating performance. We define non-GAAP net income as net income excluding share-based compensation. We define non-GAAP net income per share as non-GAAP net income dividing by weighted average number of basic and diluted share outstanding, including the dilutive effect of share-based awards as determined under the treasury stock method. We define basic and diluted non-GAAP net income per ADS as basic and diluted non-GAAP net income per share divided by two as two ADSs represent one ordinary share. We also believe that these non-GAAP financial measures provide useful information to investors and others in understanding and evaluating our consolidated results of operations in the same manner as our management and in comparing financial results across accounting periods and to those of our peer companies.
The use of non-GAAP financial measures has certain limitations. These non-GAAP measures exclude certain items that have been and will continue to be incurred in the future and are not reflected in the presentation of the non-GAAP financial measures. These non-GAAP financial measures should be considered in addition to results prepared in accordance with U.S. GAAP, and should not be considered a substitute for or superior to U.S. GAAP results. In addition, these non-GAAP financial measures may not be comparable to similarly titled measures utilized by other companies since such other companies may not calculate such measures in the same manner as
Reconciliation of these non-GAAP financial measures to the most directly comparable U.S. GAAP financial measure is set forth at the end of this release.
Exchange Rate Information
This press release contains translation of certain Renminbi amounts into U.S. dollars at specified rates solely for the convenience of readers. Unless otherwise noted, all translations from Renminbi to U.S. dollars were made at the exchange rate of RMB
Safe Harbor Statement
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements include but are not limited to
For investor and media inquiries, please contact:
In
Tel: +86 (10) 6588-0135
E-mail: ir@secoo.com
Tel: +86 (10) 5730-6202
E-mail: Secoo@tpg-ir.com
In
The Piacente Group, Inc.
Tel: +1-212-481-2050
E-mail: Secoo@tpg-ir.co
SECOO HOLDING LIMITED | ||||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||
(All amounts in thousands, except for share data) | ||||||||
For the Three Months Ended March 31, | ||||||||
2017 | 2018 | |||||||
RMB | RMB | US$ | ||||||
Net revenues: | ||||||||
Merchandise sales | 552,718 | 776,367 | 123,771 | |||||
Marketplace and other services | 9,234 | 26,126 | 4,165 | |||||
| | | | | ||||
Total net revenues | 561,952 | 802,493 | 127,936 | |||||
Cost of revenues | (465,139) | (670,673) | (106,921) | |||||
| | | | | ||||
Gross profit | 96,813 | 131,820 | 21,015 | |||||
| | | | | ||||
Operating expenses: | ||||||||
Fulfillment expenses | (15,302) | (26,530) | (4,230) | |||||
Marketing expenses | (33,829) | (57,301) | (9,135) | |||||
Technology and content development expenses | (11,222) | (17,657) | (2,815) | |||||
General and administrative expenses | (12,542) | (7,034) | (1,121) | |||||
| | | | | ||||
Total operating expenses | (72,895) | (108,522) | (17,301) | |||||
| | | | | ||||
Income from operations | 23,918 | 23,298 | 3,714 | |||||
| | | | | ||||
Other income/(expenses): | ||||||||
Interest expense, net | (1,188) | (1,380) | (220) | |||||
Foreign currency exchange gains | 814 | 5,379 | 858 | |||||
Others | - | 9,112 | 1,453 | |||||
| | | | | ||||
Income before tax | 23,544 | 36,409 | 5,805 | |||||
Income tax expenses | - | (10,500) | (1,674) | |||||
| | | | | ||||
Net income | 23,544 | 25,909 | 4,131 | |||||
| | | | | ||||
(Loss)/income attributable to redeemable non-controlling interest | (181) | 297 | 47 | |||||
Loss attributable to non-redeemable non-controlling interest | (66) | (58) | (9) | |||||
| | | | | ||||
Net income attributable to Secoo Holding Limited | 23,791 | 25,670 | 4,093 | |||||
| | | | | ||||
Accretion to redeemable non-controlling interest redemption value | (304) | - | - | |||||
Accretion to preferred share redemption value | (276,249) | - | - | |||||
| | | | | ||||
Net (loss)/income attributable to ordinary shareholders of Secoo Holding Limited | (252,762) | 25,670 | 4,093 | |||||
| | | | | ||||
| | | | | ||||
Net (loss)/income per share | ||||||||
— Basic | (33.70) | 1.02 | 0.16 | |||||
— Diluted | (33.70) | 0.97 | 0.15 | |||||
Net (loss)/income per ADS | ||||||||
— Basic | (16.85) | 0.51 | 0.08 | |||||
— Diluted | (16.85) | 0.49 | 0.08 | |||||
Non-GAAP net income per ADS | ||||||||
— Basic | 1.57 | 0.68 | 0.11 | |||||
— Diluted | 0.56 | 0.65 | 0.10 | |||||
| | | | | ||||
Weighted average number of shares outstanding used in computing net income/(loss) per share | ||||||||
— Basic | 7,500,000 | 25,280,058 | 25,280,058 | |||||
— Diluted | 20,968,602 | 26,372,402 | 26,372,402 |
SECOO HOLDING LIMITED | |||||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS | |||||||
(All amounts in thousands, except for share data) | |||||||
As of December 31, | As of March 31, | ||||||
2017 | 2018 | ||||||
RMB | RMB | US$ | |||||
Assets | |||||||
Current assets | |||||||
Cash | 453,425 | 105,356 | 16,796 | ||||
Time deposits | 292,318 | 251,524 | 40,099 | ||||
Restricted cash | 55,214 | 53,134 | 8,471 | ||||
Investment in equity security | - | 30,675 | 4,890 | ||||
Amount due from related parties | 38 | 35 | 6 | ||||
Accounts receivable | 54,210 | 69,363 | 11,058 | ||||
Inventories, net | 1,189,885 | 1,195,059 | 190,521 | ||||
Advances to suppliers | 53,016 | 38,507 | 6,139 | ||||
Prepayments and other current assets | 22,943 | 43,656 | 6,960 | ||||
| | | | | | | |
Total current assets | 2,121,049 | 1,787,309 | 284,940 | ||||
| | | | | | | |
Non-current assets | |||||||
Restricted cash | 123,800 | 156,250 | 24,910 | ||||
Property and equipment, net | 40,793 | 45,406 | 7,239 | ||||
Deferred tax assets |
43,981 | 42,675 | 6,803 | ||||
Other non-current assets |
8,085 | 13,610 | 2,169 | ||||
| | | | | | | |
Total non-current assets | 216,659 | 257,941 | 41,121 | ||||
| | | | | | | |
Total assets | 2,337,708 | 2,045,250 | 326,061 | ||||
LIABILITIES | |||||||
Current liabilities | |||||||
Short-term borrowings and current portion of long-term borrowings | 177,274 | 142,065 | 22,649 | ||||
Accounts payable | 318,414 | 165,291 | 26,351 | ||||
Amount due to related parties | 2,467 | 11,523 | 1,837 | ||||
Advances from customers | 68,848 | 39,032 | 6,223 | ||||
Accrued expenses and other current liabilities | 343,936 | 215,403 | 34,341 | ||||
Deferred revenue | 12,051 | 18,801 | 2,997 | ||||
| | | |||||
Total current liabilities | 922,990 | 592,115 | 94,398 | ||||
Non-current liabilities | |||||||
Long-term borrowings, excluding current portion | 124,324 | 151,558 | 24,162 | ||||
| | | | | | | |
Total non-current liabilities | 124,324 | 151,558 | 24,162 | ||||
| | | | | | | |
Total liabilities | 1,047,314 | 743,673 | 118,560 | ||||
| | | | | | | |
Mezzanine Equity | |||||||
Redeemable non-controlling interest | 5,582 | 5,879 | 937 | ||||
| | | | | | ||
Total mezzanine equity | 5,582 | 5,879 | 937 | ||||
Equity: | |||||||
Class A Ordinary shares (US$0.001 par value, 150,000,000 shares authorized including class A shares and class B shares, 19,068,224 shares issued and 18,708,629 shares outstanding as of December 31, 2017 and March 31, 2018, respectively) | 126 | 126 | 20 | ||||
Class B Ordinary shares (US$0.001 par value, 150,000,000 shares authorized including class A shares and class B shares, 6,571,429 shares issued and 6,571,429 shares outstanding as of December 31, 2017 and March 31, 2018, respectively) | 41 | 41 | 7 | ||||
Treasury Stock (359,595 Class A ordinary shares as of December 31, 2017 and March 31, 2018, respectively, at cost) | (42,606) | (42,606) | (6,792) | ||||
Accumulated losses | (1,432,586) | (1,406,916) | (224,296) | ||||
Additional paid-in capital | 2,763,387 | 2,771,940 | 441,912 | ||||
Accumulated other comprehensive loss | (5,304) | (31,055) | (4,951) | ||||
| | | | | | ||
Total equity attributable to ordinary shareholders | 1,283,058 | 1,291,530 | 205,900 | ||||
| | | | | | ||
Non-redeemable non-controlling interest | 1,754 | 4,168 | 664 | ||||
| | | | | | ||
Total equity | 1,284,812 | 1,295,698 | 206,564 | ||||
| | | | | | ||
Total liabilities, mezzanine equity and equity | 2,337,708 | 2,045,250 | 326,061 |
SECOO HOLDING LIMITED | |||||||||
Reconciliations of GAAP and Non-GAAP Results | |||||||||
(All amounts in thousands, except for share and per share data) | |||||||||
For the Three Months Ended | |||||||||
March 31, | |||||||||
2017 | 2018 | ||||||||
RMB | RMB | US$ | |||||||
Income from operations | 23,918 | 23,298 | 3,714 | ||||||
Add: | |||||||||
Share-based compensation expenses | - | 8,553 | 1,364 | ||||||
| |||||||||
Adjusted Income from operations | 23,918 | 31,851 | 5,078 | ||||||
Net income | 23,544 | 25,909 | 4,131 | ||||||
Add: | |||||||||
Share-based compensation expenses | - | 8,553 | 1,364 | ||||||
| |||||||||
Adjusted net income | 23,544 | 34,462 | 5,495 | ||||||
| |||||||||
Adjusted net income per weighted average shares: | |||||||||
— Basic | 3.14 | 1.36 | 0.22 | ||||||
— Diluted | 1.12 | 1.31 | 0.21 | ||||||
Adjusted net income per ADS: | |||||||||
— Basic | 1.57 | 0.68 | 0.11 | ||||||
— Diluted | 0.56 | 0.65 | 0.10 | ||||||
Weighted average number of shares outstanding used in computing the adjusted net income per share | |||||||||
— Basic | 7,500,000 | 25,280,058 | 25,280,058 | ||||||
— Diluted | 20,968,602 | 26,372,402 | 26,372,402 |
Source: Secoo Holding Limited