LightInTheBox Reports First Quarter 2020 Financial Results
BEIJING, June 19, 2020 /PRNewswire/ -- LightInTheBox Holding Co., Ltd. (NYSE: LITB) ("LightInTheBox" or the "Company"), a cross-border e-commerce platform that delivers products directly to consumers around the world, today announced its unaudited financial results for the first quarter ended March 31, 2020.
First Quarter 2020 Highlights
-- Total revenues increased 1.3% year-over-year to $51.5 million.
-- Gross margin expanded further to 46.4% from 40.4% last quarter and 34.8%
in the same quarter of 2019.
-- Third consecutive quarter of GAAP profitability despite impact from
COVID-19 pandemic with net income of $0.7 million, compared with a net
loss of $14.1 million in the same quarter of 2019.
-- Adjusted EBITDA improved significantly, increasing to earnings of $1.4
million, compared with a loss of $7.9 million in the same quarter of
2019.
Mr. Jian He, Chief Executive Officer of LightInTheBox, commented, "We responded quickly and decisively to the outbreak of COVID-19 by implementing a number of strategic initiatives to provide us with the flexibility needed to adapt to a challenging global economic environment. Seasonally, the first quarter is generally the slowest quarter of the year, so the COVID-19 induced economic disruption made the operating environment even more difficult. We took advantage of the temporary slowdown to deepen relationships with high-quality suppliers, optimize our product portfolio and category mix, and improve order fulfillment speed. We also prioritized the health and safety of our employees to ensure business continuity and adequately prepare for the resumption of normal operations while demonstrating our commitment to corporate social responsibility by including free medical face masks in numerous orders shipped to markets that were being impacted heavily by the pandemic. Despite the challenging operational environment, our financial results this quarter are a reflection of our ability to adapt and is highlighted by our third and consecutive quarter of GAAP profitability which I believe demonstrates the long-term growth trajectory we are on. We remain focused on executing our strategy and are very encouraged by our improvements to date. We are already starting to see certain product categories regain strong growth momentum towards the end of the second quarter as global markets begin re-opening and expect that both our operating and financial results will continue to improve going forward."
First Quarter 2020 Financial Results
Total revenues increased by 1.3% year-over-year to $51.5 million from $50.9 million in the same quarter of 2019. Revenues generated from product sales were $49.9 million, compared with $49.8 million in the same quarter of 2019. Revenues from service and others were $1.6 million, compared with $1.1 million in the same quarter of 2019.
The number of orders for product sales was 1.0 million in the first quarter of 2020, compared with 1.2 million in the same quarter of 2019. The number of customers for product sales was 0.8 million for the first quarter of 2020, compared with 0.6 million in the same quarter of 2019.
Revenues generated from product sales in the apparel category were $13.4 million in the first quarter of 2020, compared with $14.4 million in the same quarter of 2019. As a percentage of product sales, apparel revenues accounted for 26.8% in the first quarter of 2020, compared with 28.9% in the same quarter of 2019. Revenues generated from product sales from other general merchandise were $36.5 million in the first quarter of 2020.
Total cost of revenues was $27.6 million in the first quarter of 2020, compared with $33.2 million in the same quarter of 2019. Cost for product sales was $26.9 million in the first quarter of 2020, compared with $32.8 million in the same quarter of 2019. Cost for service and others was $0.7 million in the first quarter of 2020, compared with $0.4 million in the same quarter of 2019.
Gross profit in the first quarter of 2020 was $23.9 million, compared with $17.7 million in the same quarter of 2019. Gross margin was 46.4% in the first quarter of 2020, compared with 34.8% in the same quarter of 2019. The increase in gross margin was a result of the Company's continuous efforts to drive revenues from categories with higher margins.
Total operating expenses in the first quarter of 2020 were $27.1 million, compared with $26.5 million in the same quarter of 2019.
-- Fulfillment expenses in the first quarter of 2020 were $5.0 million,
compared with $5.2 million in the same quarter of 2019. As a percentage
of total revenues, fulfillment expenses were 9.8% in the first quarter
of 2020, compared with 10.2% in the same quarter of 2019 and 10.7% in
the fourth quarter of 2019.
-- Selling and marketing expenses in the first quarter of 2020 were $14.8
million, compared with $9.3 million in the same quarter of 2019. As a
percentage of total revenues, selling and marketing expenses were 28.7%
for the first quarter of 2020, compared with 18.3% in the same quarter
of 2019 and 23.9% in the fourth quarter of 2019.
-- G&A expenses in the first quarter of 2020 were $7.3 million, compared
with $12.0 million in the same quarter of 2019. As a percentage of total
revenues, G&A expenses were 14.1% for the first quarter of 2020,
compared with 23.6% in the same quarter of 2019 and 11.8% in the fourth
quarter of 2019. Included in G&A expenses, R&D expenses in the first
quarter of 2020 were $3.5 million, compared with $4.2 million in the
same quarter of 2019.
Net income was $0.7 million in the first quarter of 2020, compared with a net loss of $14.1 million in the same quarter of 2019.
Net income per American Depository Share ("ADS") was $0.01 in the first quarter of 2020, compared with net loss per ADS of $0.21 in the same quarter of 2019. Each ADS represents two ordinary shares. The diluted net income per ADS was $0.01 in the first quarter of 2020, compared with the diluted net loss per ADS of $0.21 in the same quarter of 2019.
In the first quarter of 2020, the Company's basic weighted average number of ADSs used in computing the net income per ADS was 102,240,901 and the diluted weighted average number of ADSs was 112,122,548.
Adjusted EBITDA, which represents gain / (loss) from operations before share-based compensation expense, change in fair value of convertible promissory notes, interest income, interest expense, income tax expense and depreciation and amortization expenses, was earnings of $1.4 million in the first quarter of 2020, compared with a loss of $7.9 million in the same quarter of 2019.
As of March 31, 2020, the Company had cash and cash equivalents and restricted cash of $35.6 million, compared with $40.4 million as of December 31, 2019.
Business Outlook
For the second quarter of 2020, based on current information available to the Company and business seasonality, the Company expects net revenues to be between $105 million and $120 million.
Non-GAAP Financial Measures
To supplement our consolidated financial statements, which are prepared and presented in accordance with U.S. GAAP, we use the following non-GAAP financial measures to help evaluate our operating performance:
"Adjusted EBITDA" represents gain /(loss) from operations before share-based compensation expense, change in fair value of convertible promissory notes, interest income, interest expense, income tax expense and depreciation and amortization expenses. Although other companies may calculate adjusted EBITDA differently or not present it at all, we believe that the adjusted EBITDA helps to identify underlying trends in our operating results, enhancing their understanding of the past performance and future prospects.
Conference Call
The Company will hold a conference call to discuss the results at 7:00 a.m. Eastern Time on June 19, 2020 (7:00 p.m. Beijing Time on the same day).
Preregistration Information
Participants can register for the conference call by navigating to http://apac.directeventreg.com/registration/event/8893322. Once preregistration has been complete, participants will receive dial-in numbers, an event passcode, and a unique registrant ID.
To join the conference, simply dial the number in the calendar invite you receive after preregistering, enter the event passcode followed by your unique registrant ID, and you will be joined to the conference instantly.
A telephone replay will be available two hours after the conclusion of the conference call through June 26, 2020. The dial-in details are:
US/Canada:
+1-855-452-5696
Hong Kong:
800-963-117
International:
+61-2-8199-0299
Passcode: 8893322
Additionally, a live and archived webcast of the conference call will be available on the Company's Investor Relations website at http://ir.lightinthebox.com.
About LightInTheBox Holding Co., Ltd.
LightInTheBox is a cross-border e-commerce platform that delivers products directly to consumers around the world. The Company offers customers a convenient way to shop for a wide selection of products at attractive prices through its www.lightinthebox.com, www.miniinthebox.com, www.ezbuy.com and other websites and mobile applications, which are available in 23 major languages and cover more than 140 countries.
For more information, please visit www.lightinthebox.com.
Investor Relations Contact
Christensen
Ms. Xiaoyan Su
Tel: +86 (10) 5900 3429
Email: ir@lightinthebox.com
OR
Christensen
Ms. Linda Bergkamp
Tel: +1-480-614-3004
Email: lbergkamp@ChristensenIR.com
Forward-Looking Statements
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," "potential," "continue," "ongoing," "targets" and similar statements. Among other things, statements that are not historical facts, including statements about LightInTheBox's beliefs and expectations, the business outlook and quotations from management in this announcement, as well as LightInTheBox's strategic and operational plans, are or contain forward-looking statements.
LightInTheBox may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (the "SEC"), in press releases and other written materials and in oral statements made by its officers, directors or employees to fourth parties. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward- looking statement, including but not limited to the following: LightInTheBox's goals and strategies; LightInTheBox's future business development, results of operations and financial condition; the expected growth of the global online retail market; LightInTheBox's ability to attract customers and further enhance customer experience and product offerings; LightInTheBox's ability to strengthen its supply chain efficiency and optimize its logistics network; LightInTheBox's expectations regarding demand for and market acceptance of its products; competition; fluctuations in general economic and business conditions and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in LightInTheBox's filings with the SEC. All information provided in this press release and in the attachments is as of the date of this press release, and LightInTheBox does not undertake any obligation to update any forward-looking statement, except as required under applicable law.
LightInTheBox Holding Co., Ltd.
Unaudited Condensed Consolidated Balance Sheets
(U.S. dollars in thousands, or otherwise noted)
As of December 31,
As of March 31,
2019 2020
ASSETS
Current Assets
Cash and cash equivalents 37,736 33,902
Restricted cash 2,709 1,684
Accounts receivable, net of
allowance for doubtful
accounts 1,356 1,411
Amounts due from related
parties 4,600 2,802
Inventories 7,357 7,316
Prepaid expenses and other
current assets 3,619 4,121
Total current assets 57,377 51,236
Property and equipment, net 3,502 3,245
Intangible assets, net 8,516 8,350
Goodwill 27,922 27,465
Operating lease right-of-use
assets 12,233 13,504
Long-term rental deposits 778 723
Long-term investments 2,873 6,634
TOTAL ASSETS 113,201 111,157
LIABILITIES AND EQUITY
Current Liabilities
Accounts payable 17,643 11,957
Amounts due to related parties 186 167
Advance from customers 21,731 28,921
Operating lease liabilities 3,470 4,642
Accrued expenses and other
current liabilities 28,642 24,273
Total current liabilities 71,672 69,960
Operating lease liabilities 8,801 9,173
Long-term payable 847 726
TOTAL LIABILITIES 81,320 79,859
EQUITY
Ordinary shares 14 17
Additional paid-in capital 262,888 278,804
Forward contracts 15,769
Treasury shares, at cost (27,512) (28,268)
Accumulated other comprehensive
loss (1,444) (2,165)
Accumulated deficit (217,888) (217,267)
Non-controlling interests 54 177
TOTAL EQUITY 31,881 31,298
TOTAL LIABILITIES AND EQUITY 113,201 111,157
LightInTheBox Holding Co., Ltd.
Unaudited Condensed Consolidated Statements of Operations
(U.S. dollars in thousands, except per share data, or otherwise noted)
Three-month Period Ended
March 31,
March 31,
2019 2020
Revenues
Product sales 49,789 49,936
Services and others 1,084 1,582
Total revenues 50,873 51,518
Cost of revenues
Product sales (32,785) (26,905)
Services and others (357) (712)
Total Cost of revenues (33,142) (27,617)
Gross profit 17,731 23,901
Operating expenses
Fulfillment (5,265) (5,049)
Selling and marketing (9,269) (14,780)
General and administrative (11,984) (7,268)
Other operating income 13
Total operating expenses (26,518) (27,084)
Loss from operations (8,787) (3,183)
Interest income 123 47
Interest expense (20) (30)
Change in fair value of
convertible promissory notes (5,337)
Other Income,net 3,913
Total other (loss) /income (5,234) 3,930
(Loss) /Income before income
taxes and gain from an equity
method investment (14,021) 747
Income tax expense (216) (3)
Gain from an equity method
investment 127
Net (loss) / income (14,110) 744
Less: Net income attributable to
non-controlling interests 32 123
Net (loss) /income attributable to
LightInTheBox Holding Co., Ltd. (14,142) 621
Weighted average numbers of shares
used in calculating (loss) /
income per ordinary share
-Basic 134,458,170 204,481,801
-Diluted 134,458,170 224,245,096
Net (loss) /income per ordinary
share
-Basic (0.11) 0.00
-Diluted (0.11) 0.00
Net (loss) /income per ADS (2
ordinary shares equal to 1 ADS)
-Basic (0.21) 0.01
-Diluted (0.21) 0.01
LightInTheBox Holding Co., Ltd.
Unaudited Reconciliations of GAAP and Non-GAAP Results
(U.S. dollars in thousands, or otherwise noted)
Three-month Period Ended
March 31, March 31,
2019 2020
Net (loss) / income (14,110) 744
Less: Interest income 123 47
Interest expense (20) (30)
Income tax expense (216) (3)
Depreciation and amortization (628) (551)
EBITDA (13,369) 1,281
Less: Share-based compensation (157) (149)
Change in fair value of convertible
promissory notes (5,337)
Adjusted EBITDA* (7,875) 1,430
* Adjusted EBITDA represents gain /(loss) from operations before share-based compensation expense, change in
fair value of
convertible promissory notes, interest income, interest expense, income tax expense and depreciation and
amortization expenses.
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SOURCE LightInTheBox Holding Co., Ltd.
