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Vipshop Reports Unaudited Second Quarter 2019 Financial Results
Second Quarter 2019 Highlights
- Total net revenue for the second quarter of 2019 increased by 9.7% year over year to
RMB22.7 billion (US$3.3 billion ) fromRMB20.7 billion in the prior year period. - GMV[1] for the second quarter of 2019 increased by 11% year over year to
RMB35.1 billion fromRMB31.6 billion in the prior year period. - Gross profit for the second quarter of 2019 increased by 25.9% year over year to
RMB5.1 billion (US$741.3 million ) fromRMB4.0 billion in the prior year period. - Net income attributable to
Vipshop's shareholders for the second quarter of 2019 increased by 19.3% year over year toRMB813.5 million (US$118.5 million ) fromRMB681.6 million in the prior year period. - Non-GAAP net income attributable to
Vipshop's shareholders[2] for the second quarter of 2019 increased by 84.2% year over year toRMB1.1 billion (US$154.8 million ) fromRMB576.9 million in the prior year period. - The number of active customers[3] for the second quarter of 2019 increased by 11% year over year to 33.1 million from 29.8 million in the prior year period.
- Total orders[4] for the second quarter of 2019 increased by 33% year over year to 147.8 million from 111.3 million in the prior year period.
Mr.
Mr.
Second Quarter 2019 Financial Results
REVENUE
Total net revenue for the second quarter of 2019 increased by 9.7% year over year to
GROSS PROFIT
Gross profit for the second quarter of 2019 increased by 25.9% year over year to
OPERATING EXPENSES
Total operating expenses for the second quarter of 2019 were
- Fulfillment expenses for the second quarter of 2019 were
RMB2.2 billion (US$320.3 million ), as compared withRMB1.9 billion in the prior year period. As a percentage of total net revenue, fulfillment expenses for the second quarter of 2019 were 9.7%, as compared with 9.1% in the prior year period, primarily attributable to a write-down ofRMB275.5 million related to the Zhaoqing warehouse due to land subsidence during construction. Excluding the write-down, fulfillment expenses as a percentage of total net revenue for the quarter were 8.5%. - Marketing expenses for the second quarter of 2019 decreased to
RMB877.6 million (US$127.8 million ) fromRMB899.6 million in the prior year period. As a percentage of total net revenue, marketing expenses for the second quarter of 2019 decreased to 3.9% from 4.3% in the prior year period. - Technology and content expenses for the second quarter of 2019 decreased to
RMB422.3 million (US$61.5 million ) fromRMB510.6 million in the prior year period. As a percentage of total net revenue, technology and content expenses for the second quarter of 2019 decreased to 1.9% from 2.5% in the prior year period. - General and administrative expenses for the second quarter of 2019 were
RMB706.3 million (US$102.9 million ), as compared withRMB615.2 million in the prior year period. As a percentage of total net revenue, general and administrative expenses for the second quarter of 2019 were 3.1%, as compared with 3.0% in the prior year period.
INCOME FROM OPERATIONS
Income from operations for the second quarter of 2019 increased by 141.2% year over year to
Non-GAAP income from operations[5] for the second quarter of 2019, which excludes share-based compensation expenses and amortization of intangible assets resulting from business acquisitions, increased by 97.6% year over year to
NET INCOME
Net income attributable to
Non-GAAP net income attributable to
For the quarter ended
BALANCE SHEET AND CASH FLOW
As of
For the quarter ended
For the three months ended |
||||
Jun 30, 2018
RMB'000 |
Jun 30, 2019
RMB'000 |
Jun 30, 2019
US$'000 |
||
Net cash from operating activities |
(502,235) |
3,438,809 |
500,919 |
|
Add: Impact from Internet financing activities[11] |
469,515 |
(1,254,977) |
(182,808) |
|
Less: Capital expenditures |
(870,103) |
(936,124) |
(136,362) |
|
Free cash flow (out)/in |
(902,823) |
1,247,708 |
181,749 |
|
For the trailing twelve months ended |
||||
Jun 30, 2018
RMB'000 |
Jun 30, 2019
RMB'000 |
Jun 30, 2019
US$'000 |
||
Net cash from operating activities |
187,270 |
10,207,552 |
1,486,898 |
|
Add: Impact from Internet financing activities[11] |
1,990,180 |
(1,829,324) |
(266,471) |
|
Less: Capital expenditures |
(2,901,367) |
(3,954,839) |
(576,087) |
|
Free cash flow (out)/in |
(723,917) |
4,423,389 |
644,340 |
Business Outlook
For the third quarter of 2019, the Company expects its total net revenue to be between
Exchange Rate
The Company's business is primarily conducted in
Conference Call Information
The Company will hold a conference call on
United States: |
+1-845-675-0437 |
International Toll Free: |
+1-866-519-4004 |
China Domestic: |
400-6208-038 |
Hong Kong: |
+852-3018-6771 |
Conference ID: |
#9137629 |
The replay will be accessible through
United States Toll Free: |
+1-855-452-5696 |
International: |
+61-2-8199-0299 |
Conference ID: |
#9137629 |
A live and archived webcast of the conference call will also be available at the Company's investor relations website at http://ir.vip.com.
About
Safe Harbor Statement
This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Among other things, the business outlook and quotations from management in this announcement, as well as
Use of Non-GAAP Financial Measures
The condensed consolidated financial information is derived from the Company's unaudited interim condensed consolidated financial statements prepared in conformity with accounting principles generally accepted in
The presentation of these non-GAAP financial measures is not intended to be considered in isolation from, or as a substitute for, the financial information prepared and presented in accordance with U.S. GAAP. For more information on these non-GAAP financial measures, please see the table captioned "Vipshop Holdings Limited Reconciliations of GAAP and Non-GAAP Results" at the end of this release.
[1] "Gross merchandise value (GMV)" is defined as the total Renminbi value of all products and services sold through the Company's online sales business, online marketplace platform, and offline stores during the relevant period, including through the Company's websites and mobile apps, third-party websites and mobile apps, as well as Vipshop offline stores and Vipmaxx offline stores that were fulfilled by either the Company or its third-party merchants, regardless of whether or not the goods were delivered or returned. GMV includes shipping charges paid by buyers to sellers. For prudent considerations, the Company does not consider products or services to be sold if the relevant orders were placed and canceled pre-shipment and only included orders that left the Company's or other third-party vendors' warehouses. |
[2] Non-GAAP net income attributable to Vipshop's shareholders is a non-GAAP financial measure, which is defined as net income attributable to Vipshop's shareholders excluding (i) share-based compensation expenses, (ii) amortization of intangible assets resulting from business acquisitions and equity method investments, (iii) tax effect of amortization of intangible assets resulting from business acquisitions, (iv) investment gain and revaluation of investments excluding dividends, (v) tax effect of investment gain and revaluation of investments excluding dividends, and (vi) share of gain in investment of limited partnership that is accounted for as an equity method investee. |
[3] "Active customers" is defined as registered members who have purchased from the Company or the Company's online marketplace platforms at least once during the relevant period. |
[4] "Total orders" is defined as the total number of orders placed during the relevant period, including the orders for products and services sold through the Company's online sales business and the Company's online marketplace platforms, net of orders returned. |
[5] Non-GAAP income from operations is a non-GAAP financial measure, which is defined as income from operations excluding share-based compensation expenses and amortization of intangible assets resulting from business acquisitions. |
[6] Non-GAAP operating income margin is a non-GAAP financial measure, which is defined as non-GAAP income from operations as a percentage of total net revenues. |
[7] "ADS" means American depositary share, each of which represents 0.2 Class A ordinary share. |
[8] Non-GAAP net margin attributable to Vipshop's shareholders is a non-GAAP financial measure, which is defined as non-GAAP net income attributable to Vipshop's shareholders, as a percentage of total net revenues. |
[9] Non-GAAP net income attributable to Vipshop's shareholders per diluted ADS is a non-GAAP financial measure, which is defined as non-GAAP net income attributable to Vipshop's shareholders |
[10] Free cash flow is a non-GAAP financial measure, which is defined as net cash from operating activities adding back the impact from Internet financing activities and less capital expenditures, which include purchase and deposits of property and equipment and land use rights, and purchase of other assets. |
[11] Impact from Internet financing activities represents net cash flow relating to the Company's financial products, which are primarily consumer financing and supplier financing that the Company provides to customers and suppliers. |
Vipshop Holdings Limited |
||||
Unaudited Condensed Consolidated Statements of Income and Comprehensive Income |
||||
(In thousands, except for share and per share data) |
||||
Three Months Ended |
||||
June 30, 2018 |
March 31, 2019 |
June 30, 2019 |
June 30, 2019 |
|
RMB'000 |
RMB'000 |
RMB'000 |
USD'000 |
|
Product revenues |
20,103,555 |
20,459,633 |
21,721,951 |
3,164,159 |
Other revenues(1) |
634,820 |
858,983 |
1,021,767 |
148,837 |
Total net revenues |
20,738,375 |
21,318,616 |
22,743,718 |
3,312,996 |
Cost of revenues |
(16,694,602) |
(16,962,283) |
(17,654,577) |
(2,571,679) |
Gross profit |
4,043,773 |
4,356,333 |
5,089,141 |
741,317 |
Operating expenses: |
||||
Fulfillment expenses(2) |
(1,897,097) |
(1,761,770) |
(2,198,543) |
(320,254) |
Marketing expenses |
(899,581) |
(780,920) |
(877,573) |
(127,833) |
Technology and content expenses |
(510,603) |
(382,956) |
(422,314) |
(61,517) |
General and administrative expenses(3) |
(615,169) |
(668,920) |
(706,252) |
(102,877) |
Total operating expenses |
(3,922,450) |
(3,594,566) |
(4,204,682) |
(612,481) |
Other operating income |
278,960 |
101,404 |
80,904 |
11,785 |
Income from operations |
400,283 |
863,171 |
965,363 |
140,621 |
Investment gain and revaluation of investments |
309,059 |
214,085 |
15,012 |
2,187 |
Interest expense |
(39,003) |
(31,983) |
(12,194) |
(1,776) |
Interest income |
62,272 |
70,560 |
41,732 |
6,079 |
Foreign exchange gain(loss) |
79,557 |
(41,631) |
30,920 |
4,504 |
Income before income tax expense and share of gain of equity method investees |
812,168 |
1,074,202 |
1,040,833 |
151,615 |
Income tax expenses(4) |
(125,486) |
(243,897) |
(213,392) |
(31,084) |
Share of gain (loss) of equity method investees |
2,092 |
46,659 |
(9,572) |
(1,394) |
Net income |
688,774 |
876,964 |
817,869 |
119,137 |
Net gain attributable to noncontrolling interests |
(7,130) |
(4,682) |
(4,351) |
(634) |
Net income attributable to Vipshop's shareholders |
681,644 |
872,282 |
813,518 |
118,503 |
Shares used in calculating earnings per share(5): |
||||
Weighted average number of Class A and Class B ordinary shares: |
||||
--Basic |
132,138,434 |
133,037,380 |
133,403,777 |
133,403,777 |
--Diluted |
140,270,995 |
139,290,699 |
134,648,293 |
134,648,293 |
Net earnings per Class A and Class B ordinary share |
||||
Net income attributable to Vipshop's shareholders -- Basic |
5.16 |
6.56 |
6.10 |
0.89 |
Net income attributable to Vipshop's shareholders -- Diluted |
4.97 |
6.33 |
6.04 |
0.88 |
Net earnings per ADS (1 ordinary share equals to 5 ADSs) |
||||
Net income attributable to Vipshop's shareholders -- Basic |
1.03 |
1.31 |
1.22 |
0.18 |
Net income attributable to Vipshop's shareholders -- Diluted |
0.99 |
1.27 |
1.21 |
0.18 |
(1) Other revenues primarily consist of revenues from third-party logistics services, product promotion |
||||
(2) Fulfillment expenses include shipping and handling expenses, which amounted RMB 1.14 |
||||
(3) General and administrative expenses include amortization of intangible assets resulting from |
||||
(4) Income tax expenses include income tax benefits of RMB 0.2 million, RMB 0.2 million and RMB 0.1 |
||||
(5) Authorized share capital is re-classified and re-designated into Class A ordinary shares and Class B |
||||
Three Months Ended |
||||
June 30, 2018 |
March 31, 2019 |
June 30, 2019 |
June 30, 2019 |
|
RMB'000 |
RMB'000 |
RMB'000 |
USD'000 |
|
Share-based compensation expenses included are as follows |
||||
Fulfillment expenses |
21,217 |
19,466 |
37,497 |
5,462 |
Marketing expenses |
11,501 |
10,843 |
10,970 |
1,598 |
Technology and content expenses |
62,542 |
52,605 |
58,010 |
8,450 |
General and administrative expenses |
98,658 |
89,813 |
103,048 |
15,011 |
Total |
193,918 |
172,727 |
209,525 |
30,521 |
Vipshop Holdings Limited |
||||
Unaudited Condensed Consolidated Balance Sheets |
||||
(In thousands, except for share and per share data) |
||||
December 31, 2018 |
June 30, 2019 |
June 30, 2019 |
||
RMB'000 |
RMB'000 |
USD'000 |
||
ASSETS |
||||
CURRENT ASSETS |
||||
Cash and cash equivalents |
9,540,556 |
6,836,990 |
995,920 |
|
Restricted cash |
497,916 |
995,255 |
144,975 |
|
Short term investments |
2,321,244 |
238,302 |
34,713 |
|
Accounts receivable, net |
5,674,731 |
3,999,549 |
582,600 |
|
Amounts due from related parties |
17,475 |
78,919 |
11,496 |
|
Other receivables and prepayments,net |
3,594,736 |
2,583,560 |
376,338 |
|
Loan Receivables,net |
310,873 |
763,360 |
111,196 |
|
Inventories |
5,368,106 |
4,489,339 |
653,946 |
|
Total current assets |
27,325,637 |
19,985,274 |
2,911,184 |
|
NON-CURRENT ASSETS |
||||
Property and equipment, net |
8,531,483 |
9,194,037 |
1,339,262 |
|
Deposits for property and equipment |
176,556 |
130,076 |
18,948 |
|
Land use rights, net |
3,885,578 |
4,466,116 |
650,563 |
|
Intangible assets, net |
353,108 |
351,333 |
51,178 |
|
Investment in equity method investees |
667,427 |
717,376 |
104,498 |
|
Other investments |
1,470,551 |
1,790,343 |
260,792 |
|
Other long-term assets |
396,447 |
806,760 |
117,518 |
|
Goodwill |
367,106 |
356,050 |
51,865 |
|
Deferred tax assets, net |
388,770 |
447,254 |
65,150 |
|
Operating lease right-of-use assets(1) |
0 |
988,655 |
144,014 |
|
Total non-current assets |
16,237,026 |
19,248,000 |
2,803,788 |
|
TOTAL ASSETS |
43,562,663 |
39,233,274 |
5,714,972 |
|
LIABILTIES AND EQUITY |
||||
CURRENT LIABILITIES |
||||
Short term loans |
1,343,160 |
637,494 |
92,861 |
|
Accounts payable |
11,630,172 |
10,762,058 |
1,567,670 |
|
Advance from customers |
1,473,134 |
783,655 |
114,152 |
|
Accrued expenses and other current liabilities |
5,512,605 |
4,985,198 |
726,176 |
|
Amounts due to related parties |
323,108 |
399,082 |
58,133 |
|
Deferred income |
367,512 |
387,002 |
56,373 |
|
Securitization debt |
969,000 |
494,000 |
71,959 |
|
Convertible senior notes |
4,327,268 |
0 |
0 |
|
Operating lease liabilities(1) |
0 |
257,524 |
37,513 |
|
Total current liabilities |
25,945,959 |
18,706,013 |
2,724,837 |
|
NON-CURRENT LIABILITIES |
||||
Deferred tax liability |
4,960 |
51,267 |
7,468 |
|
Deferred income-non current |
400,951 |
455,468 |
66,346 |
|
Operating lease liabilities(1) |
0 |
720,484 |
104,950 |
|
Total non-current liabilities |
405,911 |
1,227,219 |
178,764 |
|
TOTAL LIABILITIES |
26,351,870 |
19,933,232 |
2,903,601 |
|
EQUITY: |
||||
Class A ordinary shares (US$0.0001 par value, 483,489,642 shares authorized, |
75 |
76 |
11 |
|
Class B ordinary shares (US$0.0001 par value, 16,510,358 shares authorized, |
11 |
11 |
2 |
|
Additional paid-in capital |
9,385,216 |
9,767,477 |
1,422,793 |
|
Retained earnings |
7,907,396 |
9,593,197 |
1,397,407 |
|
Accumulated other comprehensive loss |
(30,883) |
(21,181) |
(3,083) |
|
Noncontrolling interests |
(51,022) |
(39,538) |
(5,759) |
|
Total shareholders' equity |
17,210,793 |
19,300,042 |
2,811,371 |
|
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY |
43,562,663 |
39,233,274 |
5,714,972 |
|
(1) On January 1, 2019, the Company adopted ASU 2016-02, "Leases (Topic 842)" and associated |
||||
Vipshop Holdings Limited |
||||
Reconciliations of GAAP and Non-GAAP Results |
||||
Three Months Ended |
||||
June 30, 2018 |
June 30, 2019 |
June 30, 2019 |
||
RMB'000 |
RMB'000 |
USD'000 |
||
Income from operations |
400,283 |
965,363 |
140,621 |
|
Share-based compensation expenses |
193,918 |
209,525 |
30,521 |
|
Amortization of intangible assets resulting from business acquisitions |
607 |
511 |
74 |
|
Non-GAAP income from operations |
594,808 |
1,175,399 |
171,216 |
|
Net income |
688,774 |
817,869 |
119,137 |
|
Share-based compensation expenses |
193,918 |
209,525 |
30,521 |
|
Investment gain and revaluation of investments excluding dividends |
(309,059) |
(2,198) |
(320) |
|
Share of gain in investment of limited partnership that is accounted for as an equity |
0 |
24,218 |
3,528 |
|
Tax effect of investment gain and revaluation of investments excluding dividends |
9,967 |
17,150 |
2,498 |
|
Amortization of intangible assets resulting from business acquisitions and equity |
607 |
511 |
74 |
|
Tax effect of amortization of intangible assets resulting from business acquisitions |
(152) |
(128) |
(19) |
|
Non-GAAP net income |
584,055 |
1,066,947 |
155,419 |
|
Net income attributable to Vipshop's shareholders |
681,644 |
813,518 |
118,503 |
|
Share-based compensation expenses |
193,918 |
209,525 |
30,521 |
|
Investment gain and revaluation of investments excluding dividends |
(309,059) |
(2,198) |
(320) |
|
Share of gain in investment of limited partnership that is accounted for as an equity |
0 |
24,218 |
3,528 |
|
Tax effect of investment gain and revaluation of investments excluding dividends |
9,967 |
17,150 |
2,498 |
|
Amortization of intangible assets resulting from business acquisitions and equity |
597 |
501 |
73 |
|
Tax effect of amortization of intangible assets resulting from business acquisitions |
(149) |
(125) |
(18) |
|
Non-GAAP net income attributable to Vipshop's shareholders |
576,918 |
1,062,589 |
154,785 |
|
Shares used in calculating earnings per share: |
||||
Weighted average number of Class A and Class B ordinary shares: |
||||
--Basic |
132,138,434 |
133,403,777 |
133,403,777 |
|
--Diluted |
140,270,995 |
134,648,293 |
134,648,293 |
|
Non-GAAP net income per Class A and Class B ordinary share |
||||
Non-GAAP net income attributable to Vipshop's shareholders -- Basic |
4.37 |
7.97 |
1.16 |
|
Non-GAAP net income attributable to Vipshop's shareholders -- Diluted |
4.22 |
7.89 |
1.15 |
|
Non-GAAP net income per ADS (1 ordinary share equal to 5 ADSs) |
||||
Non-GAAP net income attributable to Vipshop's shareholders -- Basic |
0.87 |
1.59 |
0.23 |
|
Non-GAAP net income attributable to Vipshop's shareholders -- Diluted |
0.84 |
1.58 |
0.23 |
View original content:http://www.prnewswire.com/news-releases/vipshop-reports-unaudited-second-quarter-2019-financial-results-300901526.html
SOURCE
Jessie Fan, +86-20-2233-0732, IR@vipshop.com