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Highlights for Third Quarter 2019:
- GMV1 reached
RMB3,661.0 million (US$512.2 million ) for Q3 2019, representing an increase of 66.8% fromRMB2,194.6 million for Q3 2018. - Total number of orders2 was 1,035.3 thousand for Q3 2019, representing an increase of 74.2% from 594.4 thousand for Q3 2018.
- Number of active customers3 increased by 58.7% to 482.5 thousand for Q3 2019 from 304.0 thousand for Q3 2018.
- Total revenues reached
RMB1,941.6 million (US$271.6 million ) for Q3 2019, increasing by 23.5% fromRMB1,572.4 million for Q3 2018. - Net income increased by 38.3% to
RMB62.1 million (US$8.7 million ) for Q3 2019 fromRMB44.9 million for Q3 2018. - Non-GAAP net income4 increased by 32.0% to
RMB64.7 million (US$9.1 million ) for Q3 2019 fromRMB49.0 million for Q3 2018.
_______________________
1GMV, or Gross Market Value, refers 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 period presented.
2Total number of orders refers 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 period presented.
3 Active customer refers to a customer who made at least one account purchase during the period presented.
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.
Commentary
Mr. Richard Rixue Li, Chairman and Chief Executive Officer of
“As we commit our efforts to expanding and deepening our supply chain capabilities, we have added direct cooperation with 143 domestic and international brands since the third quarter to date. The expanded offerings appeal to the interests of high-end consumers with discerning tastes seeking premium shopping experiences. In addition, we continue advancing our technology including artificial intelligence, big data and cloud computing, especially with the deployment of our AI-powered operating system, which improve operating efficiency and provide superior customer experience. Our healthy growth momentum reaffirms the enormous and growing demand for online luxury shopping in
Mr.
Recent Developments
- From the third quarter of 2019 to date,
Secoo has established new direct collaborations with 143 brands, including Valentino,Thom Browne and Gènavant. Notably,Secoo partnered with Prada to releasePrada Spring /Summer 2020 limited edition exclusively available onSecoo . Moreover,Secoo collaborated withStella McCartney , a leading British designer brand, to exclusively unveil limited edition shoes – Elyse series.
- In the third quarter,
Secoo established a new collaboration with Stadium Goods, a prestigious premium sneaker and streetwear marketplace in the U.S., providing customers opportunities to spot trends and purchase hard-to-procure product releases.
Secoo launched the eleventh “707” anniversary promotion festival in July andSecoo “Outlets” offerings promotion festival in September, further enhancing Secoo brand awareness and improving the boutique shopping experiences on Secoo’s integrated platform.
- In November,
Secoo attended 2019 China International Import Expo (“CIIE 2019”). During the CIIE 2019,Secoo andDeloitte jointly released the Secoo – Deloitte CIIE 2019 Blue Paper, which analyzes the luxury purchasing power of consumers from lower-tier cities, providing consumer demographic characteristics and luxury shopping behaviors. This Blue Paper can be utilized as an important reference for high-end brands to design and execute their marketing activities suitable for their target markets.
- Recently,
Secoo began partnering with Vestiaire Collective,Europe's largest pre-owned luxury fashion website, to connect China’s savvy shoppers with world-class pre-owned fashion trends.
- In the third quarter,
Secoo successfully launched its live streaming shopping channel, devoted to online luxury fashion brand shopping through the convenient airing of live streaming shows featuring a wide range of top-tier boutique shops across the globe, includingEurope andHong Kong ofChina . As consumers experienced live streaming shopping, turning into consistent viewers of shopping for the latest fashions, the Company aired more than 1,000 live streaming events.
- In the third quarter,
Secoo strengthened its AI-powered operating system, along with an intelligent customer service system. Building on proprietary data-as-a-service system,Secoo is able to provide data analytics on merchandise price, sales and user behavior, enabling smarter matches between merchandises and customers and leading more accurate recommendations through the AI-powered system.
- In this quarter, the advertiser base on Secoo EEC remained robust across diverse sectors with a total of 20 brands, including 15 new brands, such as PT Platinum, Montblanc,
Qatar Airline ,Metro Group , Maserati,Ping An Insurance , and iRobot.
Third Quarter 2019 Financial Results
GMV increased by 66.8% to
Total number of orders increased by 74.2% to 1,035.3 thousand for the third quarter of 2019 from 594.4 thousand for the third quarter of 2018.
Total revenues for the third quarter of 2019 increased by 23.5% to
Cost of revenues increased by 23.8% to
Gross profit increased by 22.1% to
Operating expenses increased by 17.6% to
Fulfillment expenses increased by 18.4% to
Marketing expenses increased by 0.3% to
Technology and content development expenses increased by 23.6% to
General and administrative expenses increased by 84.6% to
Income from operations increased by 35.0% to
Non-GAAP income from operations, which excludes share-based compensation expenses, increased by 31.2% to
Income tax expenses were
Net income increased by 38.3% to
Non-GAAP net income, which excludes share-based compensation expenses, was
Net income attributable to ordinary shareholders of
Basic and diluted net income per share were
Non-GAAP basic and diluted net income per share were
Cash and Restricted Cash
As of
Fourth Quarter 2019 Guidance
The Company currently expects total revenues for the fourth quarter of 2019 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 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
The dial-in details for the live conference call are as follows:
United States: | +1-845-675-0437 |
International: | +65-6713-5090 |
Hong Kong, China: | +852-3018-6771 |
Mainland China: | 400-620-8038 |
Conference ID: | 2969318 |
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: | +61-2-8199-0299 |
Hong Kong, China: | +852-3051-2780 |
Mainland China: | 400-632-2162 |
Replay Access Code: | 2969318 |
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 income from operations, non-GAAP net income, non-GAAP net income attributable to ordinary shareholders of
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
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) 6508-0677
E-mail: Secoo@tpg-ir.com
In
Tel: +1-212-481-2050
E-mail: Secoo@tpg-ir.com
SECOO HOLDING LIMITED | ||||||||||||||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||||
(All amounts in thousands, except for share data) | ||||||||||||||||||
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||||
2018 | 2019 | 2018 | 2019 | |||||||||||||||
RMB | RMB | US$ | RMB | RMB | US$ | |||||||||||||
Revenues: | ||||||||||||||||||
Merchandise sales | 1,548,403 | 1,895,212 | 265,149 | 3,517,423 | 4,680,686 | 654,852 | ||||||||||||
Marketplace and other services | 23,954 | 46,401 | 6,492 | 77,558 | 148,426 | 20,766 | ||||||||||||
Total revenues | 1,572,357 | 1,941,613 | 271,641 | 3,594,981 | 4,829,112 | 675,618 | ||||||||||||
Cost of revenues | (1,302,657 | ) | (1,612,282 | ) | (225,567 | ) | (2,969,740 | ) | (3,927,774 | ) | (549,516 | ) | ||||||
Gross profit | 269,700 | 329,331 | 46,074 | 625,241 | 901,338 | 126,102 | ||||||||||||
Operating expenses: | ||||||||||||||||||
Fulfillment expenses | (41,886 | ) | (49,630 | ) | (6,943 | ) | (98,570 | ) | (140,451 | ) | (19,650 | ) | ||||||
Marketing expenses | (110,532 | ) | (110,844 | ) | (15,508 | ) | (256,845 | ) | (374,208 | ) | (52,354 | ) | ||||||
Technology and content development expenses | (21,166 | ) | (26,187 | ) | (3,664 | ) | (59,100 | ) | (74,366 | ) | (10,404 | ) | ||||||
General and administrative expenses | (25,850 | ) | (47,794 | ) | (6,686 | ) | (60,529 | ) | (145,886 | ) | (20,410 | ) | ||||||
Total operating expenses | (199,434 | ) | (234,455 | ) | (32,801 | ) | (475,044 | ) | (734,911 | ) | (102,818 | ) | ||||||
Income from operations | 70,266 | 94,876 | 13,273 | 150,197 | 166,427 | 23,284 | ||||||||||||
Other income/(expenses): | ||||||||||||||||||
Interest expense, net | (15,220 | ) | (29,093 | ) | (4,070 | ) | (19,164 | ) | (80,442 | ) | (11,254 | ) | ||||||
Foreign currency exchange loss | (7,583 | ) | (87 | ) | (12 | ) | (11,904 | ) | (623 | ) | (87 | ) | ||||||
Others | 6,709 | 13,419 | 1,877 | 18,110 | 59,575 | 8,335 | ||||||||||||
Income before income tax | 54,172 | 79,115 | 11,068 | 137,239 | 144,937 | 20,278 | ||||||||||||
Income tax expenses | (9,228 | ) | (17,041 | ) | (2,384 | ) | (30,014 | ) | (26,998 | ) | (3,777 | ) | ||||||
Net income | 44,944 | 62,074 | 8,684 | 107,225 | 117,939 | 16,501 | ||||||||||||
Income/(loss) attributable to redeemable non-controlling interest | 96 | (128 | ) | (17 | ) | 705 | 834 | 117 | ||||||||||
Income attributable to non-redeemable non-controlling interest | 969 | 1,147 | 160 | 1,161 | 3,177 | 444 | ||||||||||||
Net income attributable to Secoo Holding Limited | 43,879 | 61,055 | 8,541 | 105,359 | 113,928 | 15,940 | ||||||||||||
Accretion to redeemable non-controlling interest redemption value | - | (123 | ) | (17 | ) | - | (499 | ) | (70 | ) | ||||||||
Net income attributable to ordinary shareholders of Secoo Holding Limited | 43,879 | 60,932 | 8,524 | 105,359 | 113,429 | 15,870 | ||||||||||||
Net income per share | ||||||||||||||||||
— Basic | 1.74 | 2.43 | 0.34 | 4.17 | 4.52 | 0.63 | ||||||||||||
— Diluted | 1.67 | 2.33 | 0.33 | 4.04 | 4.34 | 0.61 | ||||||||||||
Net income per ADS | ||||||||||||||||||
— Basic | 0.87 | 1.21 | 0.17 | 2.08 | 2.26 | 0.32 | ||||||||||||
— Diluted | 0.84 | 1.17 | 0.16 | 2.02 | 2.17 | 0.30 | ||||||||||||
Weighted average number of shares outstanding used in computing net income per share | ||||||||||||||||||
— Basic | 25,260,757 | 25,122,199 | 25,122,199 | 25,273,554 | 25,122,199 | 25,122,199 | ||||||||||||
— Diluted | 26,236,702 | 26,115,445 | 26,115,445 | 26,096,457 | 26,111,835 | 26,111,835 | ||||||||||||
SECOO HOLDING LIMITED | |||||||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS | |||||||||
(All amounts in thousands, except for share data) | |||||||||
As of December 31, | As of September 30, | ||||||||
2018 | 2019 | ||||||||
RMB | RMB | US$ | |||||||
Assets | |||||||||
Current assets | |||||||||
Cash | 1,034,385 | 663,750 | 92,862 | ||||||
Time deposits | 68,632 | - | - | ||||||
Restricted cash | 89,222 | 91,998 | 12,871 | ||||||
Investment in equity security | 26,032 | 2,611 | 365 | ||||||
Accounts receivable | 119,580 | 137,566 | 19,246 | ||||||
Inventories | 1,712,740 | 2,406,580 | 336,693 | ||||||
Advances to suppliers | 429,219 | 459,213 | 64,246 | ||||||
Prepayments and other current assets | 133,551 | 314,015 | 43,933 | ||||||
Amount due from related parties | 13,284 | 9,272 | 1,297 | ||||||
Total current assets | 3,626,645 | 4,085,005 | 571,513 | ||||||
Non-current assets | |||||||||
Property and equipment, net | 56,698 | 78,245 | 10,947 | ||||||
Intangible Assets and goodwill | 32,680 | 53,110 | 7,430 | ||||||
Restricted cash | 2,800 | 3,000 | 420 | ||||||
Investment in equity investees | 2,859 | 53,571 | 7,495 | ||||||
Deferred tax assets | 51,214 | 69,859 | 9,774 | ||||||
Operating lease right-of-use assets | - | 150,138 | 21,005 | ||||||
Other non-current assets | 19,030 | 14,368 | 2,010 | ||||||
Total non-current assets | 165,281 | 422,291 | 59,081 | ||||||
Total assets | 3,791,926 | 4,507,296 | 630,594 | ||||||
Liabilities | |||||||||
Current liabilities | |||||||||
Short-term borrowings and current portion of long-term borrowings | 134,324 | 251,036 | 35,121 | ||||||
Accounts payable | 498,579 | 366,059 | 51,214 | ||||||
Amount due to related parties | 1,564 | 29,815 | 4,171 | ||||||
Advances from customers | 66,954 | 91,056 | 12,739 | ||||||
Accrued expenses and other current liabilities | 352,714 | 679,014 | 94,997 | ||||||
Deferred revenue | 62,478 | 74,157 | 10,375 | ||||||
Total current liabilities | 1,116,613 | 1,491,137 | 208,617 | ||||||
Non-current liabilities | |||||||||
Long-term borrowings, excluding current portion | 1,151,560 | 1,227,030 | 171,668 | ||||||
Long-term liabilities | 14,240 | 55,270 | 7,733 | ||||||
Non-current operating lease liabilities | - | 116,487 | 16,297 | ||||||
Total non-current liabilities | 1,165,800 | 1,398,787 | 195,698 | ||||||
Total liabilities | 2,282,413 | 2,889,924 | 404,315 | ||||||
| | | | | | | |||
Mezzanine Equity | |||||||||
Redeemable non-controlling interest | 7,587 | 8,920 | 1,248 | ||||||
Total mezzanine equity | 7,587 | 8,920 | 1,248 | ||||||
| | | | | | ||||
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 18,550,770 shares outstanding as of December 31, 2018 and September 30, 2019, respectively) | 126 | 126 | 18 | ||||||
Class B Ordinary shares (US$0.001 par value, 150,000,000 shares authorized including class A shares and class B shares, 6,571,429 shares issued and 6,571,429 shares outstanding as of December 31, 2018 and September 30, 2019, respectively) | 41 | 41 | 6 | ||||||
Treasury Stock (517,454 Class A ordinary shares as of December 31, 2018 and September 30, 2019, respectively, at cost) | (71,018 | ) | (71,018 | ) | (9,936 | ) | |||
Accumulated losses | (1,280,753 | ) | (1,167,324 | ) | (163,315 | ) | |||
Additional paid-in capital | 2,839,342 | 2,848,385 | 398,504 | ||||||
Accumulated other comprehensive loss | (6,373 | ) | (35,227 | ) | (4,928 | ) | |||
Total equity attributable to ordinary shareholders | 1,481,365 | 1,574,983 | 220,349 | ||||||
Non-redeemable non-controlling interest | 20,561 | 33,469 | 4,682 | ||||||
Total equity | 1,501,926 | 1,608,452 | 225,031 | ||||||
Total liabilities, mezzanine equity and equity | 3,791,926 | 4,507,296 | 630,594 | ||||||
SECOO HOLDING LIMITED | |||||||||||||||||||||||
Reconciliations of GAAP and Non-GAAP Results | |||||||||||||||||||||||
(All amounts in thousands, except for share and per share data) | |||||||||||||||||||||||
For the Three Months Ended | For the Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
2018 | 2019 | 2018 | 2019 | ||||||||||||||||||||
RMB | RMB | US$ | RMB | RMB | US$ | ||||||||||||||||||
Income from operations | 70,266 | 94,876 | 13,273 | 150,197 | 166,427 | 23,284 | |||||||||||||||||
Add: | |||||||||||||||||||||||
Share-based compensation expenses | 4,010 | 2,585 | 362 | 17,240 | 9,043 | 1,265 | |||||||||||||||||
Non-GAAP income from operations | 74,276 | 97,461 | 13,635 | 167,437 | 175,470 | 24,549 | |||||||||||||||||
Net Income | 44,944 | 62,074 | 8,683 | 107,225 | 117,939 | 16,501 | |||||||||||||||||
Add: | |||||||||||||||||||||||
Share-based compensation expenses | 4,010 | 2,585 | 362 | 17,240 | 9,043 | 1,265 | |||||||||||||||||
Non-GAAP net income | 48,954 | 64,659 | 9,045 | 124,465 | 126,982 | 17,766 | |||||||||||||||||
Net income attributable to ordinary shareholders of Secoo Holding Limited | 43,879 | 60,932 | 8,524 | 105,359 | 113,429 | 15,870 | |||||||||||||||||
Add: | |||||||||||||||||||||||
Share-based compensation expenses | 4,010 | 2,585 | 362 | 17,240 | 9,043 | 1,265 | |||||||||||||||||
Non-GAAP net income attributable to ordinary shareholders of Secoo Holding Limited | 47,889 | 63,517 | 8,886 | 122,599 | 122,472 | 17,135 | |||||||||||||||||
Non-GAAP net income per shares: | |||||||||||||||||||||||
Basic | 1.90 | 2.53 | 0.35 | 4.85 | 4.88 | 0.68 | |||||||||||||||||
Diluted | 1.83 | 2.43 | 0.34 | 4.70 | 4.69 | 0.66 | |||||||||||||||||
Non-GAAP net income per ADS: | |||||||||||||||||||||||
Basic | 0.95 | 1.26 | 0.18 | 2.43 | 2.44 | 0.34 | |||||||||||||||||
Diluted | 0.91 | 1.22 | 0.17 | 2.35 | 2.35 | 0.33 | |||||||||||||||||
Weighted average number of shares outstanding used in computing the adjusted net income per share | |||||||||||||||||||||||
— Basic | 25,260,757 | 25,122,199 | 25,122,199 | 25,273,554 | 25,122,199 | 25,122,199 | |||||||||||||||||
— Diluted | 26,236,702 | 26,115,445 | 26,115,445 | 26,096,457 | 26,111,835 | 26,111,835 | |||||||||||||||||
Source: Secoo Holding Limited