Third Quarter 2018 Financial Highlights
Third Quarter 2018 Operational Highlights
“We are pleased to report another quarter of solid growth across the board, driven primarily by growth from our existing online stores and improving operational efficiency as we invest further in developing new and innovative products and tools,” commented Mr.
Mr. Beck Chen, Chief Financial Officer of
Third Quarter 2018 Financial Results
Total net revenues were
Product sales revenue was
Services revenue was
Total operating expenses were
Income from operations was
Non-GAAP income from operations was
Net income attributable to ordinary shareholders of
Non-GAAP net income attributable to ordinary shareholders of
As of
Business Outlook
The Company expects total net revenues to be between
Conference Call
The Company will host a conference call to discuss the earnings at
Dial-in numbers for the live conference call are as follows:
International | +852 3027 6500 |
U.S. Toll Free | +1 855-824-5644 |
Mainland China Toll Free | 8009-880563 |
Hong Kong | 3027 6500 |
Passcode: 79900678# |
A telephone replay of the call will be available after the conclusion of the conference call through
Dial-in numbers for the replay are as follows:
International Dial-in | +852 3027-6520 |
U.S. Toll Free | +1 646-982-0473 |
Passcode: 319303038# |
A live and archived webcast of the conference call will be available on the Investor Relations section of Baozun’s website at http://ir.baozun.com/.
Use of Non-GAAP Financial Measures
In evaluating the Company’s business, the Company considers and uses non-GAAP income/(loss) from operations, non-GAAP operating margin, non-GAAP net income/(loss), non-GAAP net margin, non-GAAP net income (loss) attributable to ordinary shareholders of
The Company presents the non-GAAP financial measures because they are used by the Company’s management to evaluate the Company’s operating performance and formulate business plans. Non-GAAP income/(loss) from operations and non-GAAP net income/(loss) enable the Company’s management to assess the Company’s operating results without considering the impact of share-based compensation expenses and amortization of intangible assets resulting from business acquisition. The Company also believes that the use of the non-GAAP measures facilitate investors’ assessment of the Company’s operating performance.
The non-GAAP financial measures are not defined under U.S. GAAP and are not presented in accordance with U.S. GAAP. The non-GAAP financial measures have limitations as analytical tools. One of the key limitations of using non-GAAP income/(loss) from operations, non-GAAP net income/(loss), non-GAAP net income (loss) attributable to ordinary shareholders of
The Company compensates for these limitations by reconciling the non-GAAP financial measures to the nearest U.S. GAAP performance measures, which should be considered when evaluating the Company’s performance. For reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures, please see the section of the accompanying tables titled, “Reconciliations of GAAP and Non-GAAP Results.”
Safe Harbor Statements
This news release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in 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," "target," "going forward," "outlook" and similar statements. For example, our statement about our expectations for Company performance in the fourth quarter of 2018 is a forward-looking statement and is inherently uncertain. Our forward-looking statements are based upon management's current expectations and current market and operating conditions, and relate to events that involve known or unknown risks, uncertainties and other factors, all of which are difficult to predict and many of which are beyond the Company's control, which may cause the Company's actual results, performance or achievements to differ materially from those in the forward-looking statements. For example, the level of consumer economic activity in
About
For more information, please visit http://ir.baozun.com
For investor and media inquiries, please contact:
Baozun Inc.
Ms.
ir@baozun.com
Christensen
In
Mr.
Phone: +86-10-5900-1548
E-mail: carnell@christensenir.com
In U.S.
Ms.
Phone: +1-480-614-3004
Email: lbergkamp@christensenir.com
_____________________________________
1 This announcement contains translations of certain Renminbi (RMB) amounts into U.S. dollars (US$) at a specified rate solely for the convenience of the reader. Unless otherwise noted, the translation of RMB into US$ has been made at
2 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 acquisition.
3 Non-GAAP net income attributable to ordinary shareholders of
4 Each ADS represents three Class A ordinary shares.
5 Basic and diluted non-GAAP net income attributable to ordinary shareholders of
6 GMV includes value added tax and excludes (i) shipping charges, (ii) surcharges and other taxes, (iii) value of the goods that are returned and (iv) deposits for purchases that have not been settled.
7 Distribution GMV refers to the GMV under the distribution business model.
8 Non-distribution GMV refers to the GMV under the service fee business model and the consignment business model.
Baozun Inc. | |||||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS | |||||||
(In thousands) | |||||||
As of | |||||||
December 31, 2017 |
September 30, 2018 |
September 30, 2018 |
|||||
RMB | RMB | US$ | |||||
ASSETS | |||||||
Current assets | |||||||
Cash and cash equivalents | 244,809 | 390,299 | 56,829 | ||||
Restricted cash | 48,848 | 179,910 | 26,195 | ||||
Short-term investment | 312,614 | 54,925 | 7,997 | ||||
Accounts receivable, net1 | 1,085,669 | 957,838 | 139,464 | ||||
Inventories1 | 382,028 | 621,294 | 90,462 | ||||
Advances to suppliers | 88,881 | 312,811 | 45,546 | ||||
Prepayments and other current assets1 | 214,636 | 244,616 | 35,617 | ||||
Amounts due from related parties | 88,795 | 65,212 | 9,495 | ||||
Total current assets | 2,466,280 | 2,826,905 | 411,605 | ||||
Non-current assets | |||||||
Investments in equity investees | 24,268 | 39,844 | 5,801 | ||||
Property and equipment, net | 330,924 | 391,065 | 56,940 | ||||
Intangible assets, net | 66,150 | 104,467 | 15,211 | ||||
Land use right, net | 44,618 | 43,849 | 6,385 | ||||
Goodwill | 13,158 | 13,158 | 1,916 | ||||
Other non-current assets | 18,043 | 31,744 | 4,622 | ||||
Deferred tax assets | 15,528 | 16,046 | 2,336 | ||||
Total non-current assets | 512,689 | 640,173 | 93,211 | ||||
Total assets | 2,978,969 | 3,467,078 | 504,816 |
_____________________
1 Certain reclassifications in accounts receivable, inventories, prepayments and other current assets and accrued expenses and other current liabilities as of
Baozun Inc. | ||||||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
(In thousands, except for share and per share data) | ||||||||
As of | ||||||||
December 31, 2017 |
September 30, 2018 |
September 30, 2018 |
||||||
RMB | RMB | US$ | ||||||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||
Current liabilities | ||||||||
Short-term loan | 172,000 | 239,500 | 34,872 | |||||
Accounts payable | 583,532 | 490,322 | 71,391 | |||||
Notes payable | 48,000 | 378,150 | 55,060 | |||||
Income tax payables | 30,420 | 21,639 | 3,151 | |||||
Accrued expenses and other current liabilities1 | 314,870 | 262,764 | 38,259 | |||||
Amounts due to related parties | - | 13,993 | 2,037 | |||||
Total current liabilities | 1,148,822 | 1,406,368 | 204,770 | |||||
Long-term loan | - | 68,656 | 9,997 | |||||
Deferred tax liability | 3,710 | 3,417 | 498 | |||||
Total non-current liabilities | 3,710 | 72,073 | 10,495 | |||||
Total liabilities | 1,152,532 | 1,478,441 | 215,265 | |||||
Baozun Inc. shareholders’ equity: | ||||||||
Class A ordinary shares (US$0.0001 par value; 470,000,000 shares authorized, 152,824,659 and 157,935,219 shares issued and outstanding as of December 31, 2017 and September 30, 2018, respectively) | 95 | 98 | 14 | |||||
Class B ordinary shares (US$0.0001 par value; 30,000,000 shares authorized, 13,300,738 shares issued and outstanding as of December 31, 2017 and September 30, 2018, respectively) | 8 | 8 | 1 | |||||
Additional paid-in capital | 1,823,925 | 1,886,594 | 274,693 | |||||
Accumulated profit (deficit) | (25,000 | ) | 56,469 | 8,223 | ||||
Accumulated other comprehensive income | 9,995 | 28,200 | 4,106 | |||||
Total Baozun Inc. shareholders' equity | 1,809,023 | 1,971,369 | 287,037 | |||||
Noncontrolling interests | 17,414 | 17,268 | 2,514 | |||||
Total equity | 1,826,437 | 1,988,637 | 289,551 | |||||
Totalliabilities and shareholders' equity | 2,978,969 | 3,467,078 | 504,816 |
Baozun Inc. |
||||||||||||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||||||||||||||||
(In thousands, except for share and per share data and per ADS data) | ||||||||||||||||
For the three months ended September 30, |
||||||||||||||||
2017 | 2018 | |||||||||||||||
RMB | RMB | US$ | ||||||||||||||
Net revenues | ||||||||||||||||
Product sales | 472,505 | 504,534 | 73,462 | |||||||||||||
Services | 417,739 | 606,227 | 88,268 | |||||||||||||
Total net revenues | 890,244 | 1,110,761 | 161,730 | |||||||||||||
Operating expenses(1) | ||||||||||||||||
Cost of products | (407,535 | ) | (401,222 | ) | (58,419 | ) | ||||||||||
Fulfillment | (173,303 | ) | (262,014 | ) | (38,150 | ) | ||||||||||
Sales and marketing (2) | (222,028 | ) | (301,082 | ) | (43,838 | ) | ||||||||||
Technology and content | (35,568 | ) | (69,514 | ) | (10,121 | ) | ||||||||||
General and administrative | (29,636 | ) | (41,034 | ) | (5,975 | ) | ||||||||||
Other operating income, net | 5,623 | 3,399 | 495 | |||||||||||||
Total operating expenses | (862,447 | ) | (1,071,467 | ) | (156,008 | ) | ||||||||||
Income from operations | 27,797 | 39,294 | 5,722 | |||||||||||||
Other income (expenses) | ||||||||||||||||
Interest income | 3,256 | 2,203 | 321 | |||||||||||||
Interest expense | (740 | ) | (1,733 | ) | (252 | ) | ||||||||||
Gain on disposal of an investment | 800 | - | - | |||||||||||||
Exchange loss | (363 | ) | (2,133 | ) | (311 | ) | ||||||||||
Income before income tax | 30,750 | 37,631 | 5,480 | |||||||||||||
Income tax expense (3) | (8,229 | ) | (7,994 | ) | (1,164 | ) | ||||||||||
Share of loss in equity method investment, net of tax of nil | (252 | ) | (243 | ) | (35 | ) | ||||||||||
Netincome | 22,269 | 29,394 | 4,281 | |||||||||||||
Net (income) loss attributable to noncontrolling interests | (330 | ) | 393 | 57 | ||||||||||||
Net incomeattributable to ordinary shareholders of Baozun Inc. | 21,939 | 29,787 | 4,338 | |||||||||||||
Net incomeper share attributable to ordinary shareholders of Baozun Inc.: | ||||||||||||||||
Basic | 0.13 | 0.17 | 0.02 | |||||||||||||
Diluted | 0.12 | 0.17 | 0.02 | |||||||||||||
Net incomeper ADS attributable to ordinary shareholders of Baozun Inc.: | ||||||||||||||||
Basic | 0.40 | 0.52 | 0.08 | |||||||||||||
Diluted | 0.37 | 0.50 | 0.07 | |||||||||||||
Weighted average shares used in calculating net incomeper ordinary share | ||||||||||||||||
Basic | 163,205,286 | 170,940,612 | 170,940,612 | |||||||||||||
Diluted | 177,462,498 | 178,862,592 | 178,862,592 | |||||||||||||
Net income | 22,269 | 29,394 | 4,281 | |||||||||||||
Other comprehensive income, net of tax of nil: | ||||||||||||||||
Foreign currency translation adjustment | (10,719 | ) | 11,484 | 1,672 | ||||||||||||
Comprehensive income | 11,550 | 40,878 | 5,953 |
(1) Share-based compensation expenses are allocated in operating expenses items as follows:
For the three months ended September 30, | ||||||
2017 | 2018 | |||||
RMB | RMB | US$ | ||||
Fulfillment | 716 | 1,610 | 234 | |||
Sales and marketing | 4,846 | 7,707 | 1,122 | |||
Technology and content | 2,798 | 3,690 | 537 | |||
General and administrative | 4,626 | 8,497 | 1,237 | |||
12,986 | 21,504 | 3,130 |
(2) Including amortization of intangible assets resulting from business acquisition, which amounted to
(3) Including income tax benefits of
Baozun Inc. | |||||||||||||||||
Reconciliations of GAAP and Non-GAAP Results | |||||||||||||||||
(in thousands, except for share and per ADS data) | |||||||||||||||||
For the three months ended September 30, |
|||||||||||||||||
2017 | 2018 | ||||||||||||||||
RMB | RMB | US$ | |||||||||||||||
Income from operations | 27,797 | 39,294 | 5,722 | ||||||||||||||
Add: Share-based compensation expenses | 12,986 | 21,504 | 3,130 | ||||||||||||||
Amortization of intangible assets resulting from business acquisition | 391 | 391 | 57 | ||||||||||||||
Non-GAAP income from operations | 41,174 | 61,189 | 8,909 | ||||||||||||||
Net Income | 22,269 | 29,394 | 4,281 | ||||||||||||||
Add: Share-based compensation expenses | 12,986 | 21,504 | 3,130 | ||||||||||||||
Amortization of intangible assets resulting from business acquisition | 391 | 391 | 57 | ||||||||||||||
Less: Tax effect of amortization of intangible assets resulting from business acquisition | (98 | ) | (98 | ) | (14 | ) | |||||||||||
Non-GAAP net income | 35,548 | 51,191 | 7,454 | ||||||||||||||
Net income attributable to ordinary shareholders of Baozun Inc. | 21,939 | 29,787 | 4,338 | ||||||||||||||
Add: Share-based compensation expenses | 12,986 | 21,504 | 3,130 | ||||||||||||||
Amortization of intangible assets resulting from business acquisition | 199 | 199 | 29 | ||||||||||||||
Less: Tax effect of amortization of intangible assets resulting from business acquisition | (50 | ) | (50 | ) | (7 | ) | |||||||||||
Non-GAAP net income attributable to ordinary shareholders of Baozun Inc. | 35,074 | 51,440 | 7,490 | ||||||||||||||
Non-GAAP net income attributable to ordinary shareholders of Baozun Inc. per ADS: | |||||||||||||||||
Basic | 0.64 | 0.90 | 0.13 | ||||||||||||||
Diluted | 0.59 | 0.86 | 0.13 | ||||||||||||||
Weighted average shares used in calculating net income per ordinary share | |||||||||||||||||
Basic | 163,205,286 | 170,940,612 | 170,940,612 | ||||||||||||||
Diluted | 177,462,498 | 178,862,592 | 178,862,592 |
Source: Baozun Inc.