LightInTheBox Reports Third Quarter 2020 Financial Results
BEIJING, Dec. 7, 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 third quarter ended September 30, 2020.
Third Quarter and First Nine Months 2020 Financial Highlights
Three Months Ended Year-over- Nine Months Ended Year-over-
September 30, September 30, Year % September 30, September 30, Year %
In millions, except percentages 2019 2020
Change 2019 2020
Change
---
Total revenues $
59.9 $
100.0 67.0 $
168.9 $
265.4 57.1
% %
Gross margin 42.3
% 43.1
% 39.9
% 43.9
%
Net income / (loss) $
10.0 $
7.3 (26.7)
% $
(11.4) $
16.5
Adjusted EBITDA $
0.5 $
12.7 2372.7
% $
(6.5) $
23.3
As of December 31, As of September 30,
In millions 2019 2020
---
Cash, cash
equivalents
and
restricted
cash $
40.4 $
48.2
Mr. Jian He, Chief Executive Officer of LightInTheBox, commented, "During the quarter, we continued to deliver healthy and stable growth operationally and financially. Total revenues were $100.0 million in the third quarter, compared with $59.9 million in the same quarter of 2019. At the same time, we achieved adjusted EBITDA of $12.7 million and $23.3 million for the third quarter and the first nine months ended September 30, 2020, respectively, in comparison with adjusted EBITDA of $0.5 million and a loss of $6.5 million in the same periods of last year. These results reflect the growing success of our revamped strategy, which is to focus on optimizing product and category mix, enhancing supply chain management and driving customer engagement. Looking ahead, we will continue to execute our growth strategy, further enhance our partnership with key suppliers and improve customer experience within the regions we operate. We are confident that our sound strategy and solid execution positions us well to consistently achieve growth in profit and create long-term value for our shareholders."
Third Quarter 2020 Financial Results
Total revenues increased by 67.0% year-over-year to $100.0 million from $59.9 million in the same quarter of 2019. Revenues generated from product sales were $95.4 million, compared with $58.1 million in the same quarter of 2019. Revenues from service and others were $4.6 million, compared with $1.8 million in the same quarter of 2019.
Total cost of revenues was $56.9 million in the third quarter of 2020, compared with $34.6 million in the same quarter of 2019. Cost for product sales was $53.9 million in the third quarter of 2020, compared with $33.8 million in the same quarter of 2019. Cost for service and others was $3.1 million in the third quarter of 2020, compared with $0.8 million in the same quarter of 2019.
Gross profit in the third quarter of 2020 was $43.1 million, compared with $25.3 million in the same quarter of 2019. Gross margin was 43.1% in the third quarter of 2020, compared with 42.3% in the same quarter of 2019. The increase in gross margin was a result of the Company's continuous efforts to optimize the supply chain and product mix.
Total operating expenses in the third quarter of 2020 were $41.5 million, compared with $25.7 million in the same quarter of 2019.
-- Fulfillment expenses in the third quarter of 2020 were $6.7 million,
compared with $6.8 million in the same quarter of 2019. As a percentage
of total revenues, fulfillment expenses were 6.7% in the third quarter
of 2020, compared with 11.3% in the same quarter of 2019 and 6.5% in the
second quarter of 2020.
-- Selling and marketing expenses in the third quarter of 2020 were $26.9
million, compared with $12.4 million in the same quarter of 2019. As a
percentage of total revenues, selling and marketing expenses were 26.9%
for the third quarter of 2020, compared with 20.8% in the same quarter
of 2019 and 23.3% in the second quarter of 2020.
-- G&A expenses in the third quarter of 2020 were $7.9 million, compared
with $6.5 million in the same quarter of 2019. As a percentage of total
revenues, G&A expenses were 7.9% for the third quarter of 2020, compared
with 10.8% in the same quarter of 2019 and 6.6% in the second quarter of
2020. Included in G&A expenses, R&D expenses in the third quarter of
2020 were $3.5 million, compared with $4.9 million in the same quarter
of 2019 and $3.3 million in the second quarter of 2020.
Income from operations was $1.6 million in the third quarter of 2020, compared with a loss from operations of $0.4 million in the same quarter of 2019.
Net income was $7.3 million in the third quarter of 2020, compared with $10.0 million in the same quarter of 2019.
Net income per American Depository Share ("ADS") was $0.07 in the third quarter of 2020, compared with $0.15 in the same quarter of 2019. Each ADS represents two ordinary shares. The diluted net income per ADS was $0.07 in the third quarter of 2020, compared with the diluted net loss per ADS of $0.00 in the same quarter of 2019.
In the third quarter of 2020, the Company's basic weighted average number of ADSs used in computing the net income per ADS was 110,299,994 and the diluted weighted average number of ADSs was 111,910,060.
Adjusted EBITDA, which represents a 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 $12.7 million in the third quarter of 2020, compared with $0.5 million in the same quarter of 2019.
As of September 30, 2020, the Company had cash and cash equivalents and restricted cash of $48.2 million, compared with $55.0 million as of June 30, 2020.
First Nine Months 2020 Financial Results
Total revenues increased by 57.1% year-over-year to $265.4 million from $168.9 million in the same months of 2019. Revenues generated from product sales were $252.6 million, compared with $165.0 million in the same months of 2019. Revenues from service and others were $12.8 million, compared with $3.9 million in the same months of 2019.
Total cost of revenues was $148.9 million in the first nine months of 2020, compared with $101.5 million in the same months of 2019. Cost for product sales was $139.7 million in the first nine months of 2020, compared with $100.2 million in the same months of 2019. Cost for service and others was $9.2 million in the first nine months of 2020, compared with $1.3 million in the same months of 2019.
Gross profit in the first nine months of 2020 was $116.5 million, compared with $67.4 million in the same months of 2019. Gross margin was 43.9% in the first nine months of 2020, compared with 39.9% in the same months of 2019. The increase in gross margin was a result of the Company's continuous efforts to optimize the supply chain and product mix.
Total operating expenses in the first nine months of 2020 were $110.0 million, compared with $79.1 million in the same months of 2019.
-- Fulfillment expenses in the first nine months of 2020 were $19.1
million, compared with $16.9 million in the same months of 2019. As a
percentage of total revenues, fulfillment expenses were 7.2% in the
first nine months of 2020, compared with 10.0% in the same months of
2019.
-- Selling and marketing expenses in the first nine months of 2020 were
$68.2 million, compared with $33.2 million in the same months of 2019.
As a percentage of total revenues, selling and marketing expenses were
25.7% in the first nine months of 2020, compared with 19.7% in the same
months of 2019.
-- G&A expenses in the first nine months of 2020 were $22.7 million,
compared with $29.0 million in the same months of 2019. As a percentage
of total revenues, G&A expenses were 8.6% in the first nine months of
2020, compared with 17.1% in the same months of 2019. Included in G&A
expenses, R&D expenses in the first nine months of 2020 were $10.4
million, compared with $13.2 million in the same months of 2019.
Income from operations was $6.6 million in the first nine months of 2020, compared with loss from operations of $11.7 million in the same months of 2019.
Net income was $16.5 million in the first nine months of 2020, compared with a net loss of $11.4 million in the same months of 2019.
Net income per American Depository Share ("ADS") was $0.15 in the first nine months of 2020, compared with net loss per ADS of $0.17 in the same months of 2019. Each ADS represents two ordinary shares. The diluted net income per ADS for the first nine months of 2020 was $0.15, compared with the diluted net loss per ADS of $0.17 in the same months of 2019.
In the first nine months of 2020, the Company's basic weighted average number of ADSs used in computing the net income per ADS was 108,562,216, and 112,389,708 in diluted weighted average number.
Adjusted EBITDA, which represents a 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 $23.3 million in the first nine months of 2020, compared with loss of $6.5 million in the same months of 2019.
Business Outlook
For the fourth quarter of 2020, based on current information available to the Company and business seasonality, the Company expects net revenues to be between $120 million and $135 million, which would represent an increase of between 61% and 81% compared with the fourth quarter of 2019.
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 a 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 8:00 a.m. Eastern Time on December 7, 2020 (9:00 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/8653739. 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 December 14, 2020. The dial-in details are:
US/Canada: +1-855-452-5696
Hong Kong:
800-963-117
International: +61-2-8199-0299
Passcode: 8653739
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 25 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 September 30,
2019 2020
ASSETS
Current Assets
Cash and cash equivalents 37,736 45,896
Restricted cash 2,709 2,319
Accounts receivable, net of allowance for doubtful accounts 1,356 1,124
Amounts due from related parties 4,600 2,772
Inventories 7,357 8,221
Prepaid expenses and other current assets 3,619 3,467
Total current assets 57,377 63,799
Property and equipment, net 3,502 3,234
Intangible assets, net 8,516 8,952
Goodwill 27,922 28,613
Operating lease right-of-use assets 12,233 12,329
Long-term rental deposits 778 1,041
Long-term investments 2,873 16,035
TOTAL ASSETS 113,201 134,003
LIABILITIES AND EQUITY
Current Liabilities
Accounts payable 17,643 12,846
Amounts due to related parties 186 167
Advance from customers 21,731 24,842
Operating lease liabilities 3,470 4,013
Accrued expenses and other current liabilities 28,642 31,656
Total current liabilities 71,672 73,524
Operating lease liabilities 8,801 8,375
Long-term payable 847 130
Deferred tax liability 3,272
TOTAL LIABILITIES 81,320 85,301
EQUITY
Ordinary shares 14 17
Additional paid-in capital 262,888 280,409
Forward contracts 15,769
Treasury shares, at cost (27,512) (30,207)
Accumulated other comprehensive loss (1,444) (212)
Accumulated deficit (217,888) (201,379)
Non-controlling interests 54 74
TOTAL EQUITY 31,881 48,702
TOTAL LIABILITIES AND EQUITY 113,201 134,003
LightInTheBox Holding Co., Ltd.
Unaudited Condensed Consolidated Statements of Operations
(U.S. dollars in thousands, except per share data, or otherwise noted)
Three Months Ended Nine Months Ended
September 30,
September 30,
September 30,
September 30,
2019 2020 2019 2020
Revenues
Product sales 58,139 95,426 165,039 252,597
Services and others 1,752 4,584 3,867 12,809
Total revenues 59,891 100,010 168,906 265,406
Cost of revenues
Product sales (33,790) (53,857) (100,193) (139,726)
Services and others (794) (3,081) (1,313) (9,157)
Total Cost of revenues (34,584) (56,938) (101,506) (148,883)
Gross profit 25,307 43,072 67,400 116,523
Operating expenses
Fulfillment (6,763) (6,661) (16,934) (19,124)
Selling and marketing (12,440) (26,880) (33,232) (68,159)
General and administrative (6,474) (7,908) (28,957) (22,693)
Other operating income (56) 16
Total operating expenses (25,677) (41,505) (79,123) (109,960)
(Loss) / Income from operations (370) 1,567 (11,723) 6,563
Interest income 49 4 246 57
Interest expense (13) (35) (51) (78)
Change in fair value of convertible promissory notes 10,347 (1,595)
Other Income,net 8,960 13,174
Total other income / (loss) 10,383 8,929 (1,400) 13,153
Income / (Loss) before income taxes and gain from an equity method 10,013 10,496 (13,123) 19,716
investment
Income tax expense (19) (3,188) (439) (3,187)
Gain from an equity method investment (20) 2,136
Net income / (loss) 9,974 7,308 (11,426) 16,529
Less: Net income / (loss) attributable to non-controlling interests (138) (98) (34) 20
Net income / (loss) attributable to LightInTheBox Holding Co., Ltd. 10,112 7,406 (11,392) 16,509
Weighted average numbers of shares used in calculating income /
(loss) per ordinary share
-Basic 134,694,173 220,599,987 134,586,488 217,124,431
-Diluted 223,577,289 223,820,121 134,586,488 224,779,416
Net income / (loss) per ordinary share
-Basic 0.08 0.03 (0.08) 0.08
-Diluted (0.00) 0.03 (0.08) 0.07
Net income / (loss) per ADS (2 ordinary shares equal to 1 ADS)
-Basic 0.15 0.07 (0.17) 0.15
-Diluted (0.00) 0.07 (0.17) 0.15
LightInTheBox Holding Co., Ltd.
Unaudited Reconciliations of GAAP and Non-GAAP Results
(U.S. dollars in thousands, or otherwise noted)
Three Months Ended Nine Months Ended
September 30,
September 30,
September 30,
September 30,
2019 2020 2019 2020
Net income / (loss) 9,974 7,308 (11,426) 16,529
Less: Interest income 49 4 246 57
Interest expense (13) (35) (51) (78)
Income tax expense (19) (3,188) (439) (3,187)
Depreciation and amortization (598) (633) (1,860) (1,770)
EBITDA 10,555 11,160 (9,322) 21,507
Less: Share-based compensation (305) (1,525) (1,261) (1,754)
Change in fair value of convertible promissory notes 10,347 (1,595)
Adjusted EBITDA* 513 12,685 (6,466) 23,261
* 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.
