LightInTheBox Reports Third Quarter 2019 Financial Results
Third Quarter 2019 Highlights
- Total revenues regained significant growth momentum increasing 34.6% year-over-year to
$59.9 million . - Gross margin improved to 42.3% from 15.1% in the same quarter of 2018.
- Net income was
$10.0 million , compared with a net loss of$17.8 million in the same quarter of 2018. - Adjusted EBITDA[1] improved significantly, increasing to earnings of
$0.5 million , compared with a loss of$17.3 million in the same quarter of 2018.
[1] For a discussion of the use of non-GAAP financial measures, see "Non-GAAP Financial Measures." |
Mr.
Third Quarter 2019 Financial Results
Total revenues increased by 34.6% year-over-year to
The number of orders for product sales was 1.4 million in the third quarter of 2019, compared with 0.8 million in the same quarter of 2018. The number of customers for product sales was 0.8 million for the third quarter of 2019, compared with 0.7 million in the same quarter of 2018.
Revenues generated from product sales in the apparel category were
Total cost of revenues was
Gross profit in the third quarter of 2019 was
Total operating expenses in the third quarter of 2019 were
- Fulfillment expenses in the third quarter of 2019 were
$6.8 million , compared with$3.4 million in the same quarter of 2018. As a percentage of total revenues, fulfillment expenses were 11.3% in the third quarter of 2019, compared to 7.6% in the same quarter of 2018 and 8.4% in the second quarter of 2019. - Selling and marketing expenses in the third quarter of 2019 were
$12.4 million , compared with$11.3 million in the same quarter of 2018. As a percentage of total revenues, selling and marketing expenses were 20.8% for the third quarter of 2019, compared to 25.4% in the same quarter of 2018 and 19.8% in the second quarter of 2019. - G&A expenses in the third quarter of 2019 were
$1.6 million , compared with$7.5 million in the same quarter of 2018. As a percentage of total revenues, G&A expenses were 2.6% for the third quarter of 2019, compared with 16.9% in the same quarter of 2018 and 11.0% in the second quarter of 2019. - R&D expenses in the third quarter of 2019 were
$4.9 million , compared with$2.5 million in the same quarter of 2018. As a percentage of total revenues, R&D expenses represented 8.2% for the third quarter of 2019, compared with 5.7% in the same quarter of 2018 and 7.1% in the second quarter of 2019.
Loss from operations was
Net income was
Net income per American Depository Share ("ADS") was
In the third quarter of 2019, the Company's basic weighted average number of ADSs used in computing the income per ADS was 67,347,087, and 111,788,645 ADSs in diluted weighted average number.
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
As of September 30, 2019, the Company had cash and cash equivalents and restricted cash of
Business Outlook
For the fourth quarter of 2019, based on current information available to the Company and business seasonality, the Company expects net revenues to be between
Change in Fair Value of Convertible Promissory Notes Associated with the Acquisition of Ezbuy
The Company entered into a share purchase agreement ("SPA") on November 8, 2018 to acquire Ezbuy in the form of non-interest bearing one-year convertible promissory notes. This SPA took effect on December 10, 2018 when LITB's closing stock price was
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.
The Company received a letter from the
The Company can regain compliance at any time during the six-month cure period if on the last trading day of any calendar month during the cure period the Company has a closing share price of at least
The Company has notified the
Conference Call
The Company will hold a conference call at 8:00 a.m. Eastern Time on December 10, 2019 to discuss its financial results and operating performance for the third quarter of 2019. To participate in the call, please dial the following numbers:
US Toll Free: |
1-866-519-4004 |
Hong Kong Toll Free: |
800-906-601 |
Mainland China: |
400-620-8038 |
International: |
+65-6713-5090 |
Passcode: |
8998868 |
A telephone replay will be available two hours after the conclusion of the conference call through December 17, 2019. The dial-in details are:
US: |
+1-646-254-3697 |
Hong Kong: |
+852-3051-2780 |
International: |
+61-2-8199-0299 |
Passcode: |
8998868 |
A live and archived webcast of the conference call will be available on the Investor Relations section of
About
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 Holding Co., Ltd. |
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Unaudited Condensed Consolidated Balance Sheets |
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(U.S. dollars in thousands, or otherwise noted) |
|||
As of December 31, |
As of September 30, |
||
2018 |
2019 |
||
ASSETS |
|||
Current Assets |
|||
Cash and cash equivalents |
38,808 |
29,054 |
|
Restricted cash |
994 |
642 |
|
Accounts receivable, net of allowance for doubtful accounts |
1,463 |
1,721 |
|
Amounts due from related parties |
— |
4,113 |
|
Inventories |
8,481 |
6,584 |
|
Prepaid expenses and other current assets |
5,811 |
4,920 |
|
Total current assets |
55,557 |
47,034 |
|
Property and equipment, net |
3,652 |
2,936 |
|
Intangible assets, net |
9,890 |
8,973 |
|
Goodwill |
28,169 |
28,169 |
|
Operating lease right-of-use assets, net |
— |
6,923 |
|
Long-term rental deposits |
1,131 |
913 |
|
Long-term investments |
5,188 |
2,798 |
|
TOTAL ASSETS |
103,587 |
97,746 |
|
LIABILITIES AND DEFICIT |
|||
Current Liabilities |
|||
Accounts payable |
12,941 |
12,640 |
|
Amounts due to related parties |
4,953 |
— |
|
Convertible promissory notes |
51,922 |
53,517 |
|
Advance from customers |
17,732 |
17,185 |
|
Current operating lease liabilities |
— |
3,124 |
|
Income tax payable |
26 |
147 |
|
Accrued expenses and other current liabilities |
22,662 |
25,326 |
|
Total current liabilities |
110,236 |
111,939 |
|
Non-current operating lease liabilities |
— |
3,757 |
|
Non-current finance lease liabilities |
1,156 |
900 |
|
TOTAL LIABILITIES |
111,392 |
116,596 |
|
DEFICIT |
|||
Ordinary shares |
11 |
11 |
|
Additional paid-in capital |
239,269 |
240,530 |
|
Treasury shares, at cost |
(27,261) |
(27,261) |
|
Accumulated other comprehensive loss |
(932) |
(1,812) |
|
Accumulated deficit |
(218,887) |
(230,279) |
|
Non-controlling interests |
(5) |
(39) |
|
TOTAL DEFICIT |
(7,805) |
(18,850) |
|
TOTAL LIABILITIES AND DEFICIT |
103,587 |
97,746 |
LightInTheBox Holding Co., Ltd. |
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Unaudited Condensed Consolidated Statements of Operations |
|||||||
(U.S. dollars in thousands, except per share data, or otherwise noted) |
|||||||
Three-month Period Ended |
Nine-month Period Ended |
||||||
September 30, |
September 30, |
September 30, |
September 30, |
||||
2018 |
2019 |
2018 |
2019 |
||||
Revenues |
|||||||
Product sales |
42,910 |
58,139 |
160,942 |
165,039 |
|||
Services and others |
1,593 |
1,752 |
9,058 |
3,867 |
|||
Total revenues |
44,503 |
59,891 |
170,000 |
168,906 |
|||
Cost of revenues |
|||||||
Product sales |
(36,336) |
(33,790) |
(120,386) |
(100,193) |
|||
Services and others |
(1,442) |
(794) |
(8,330) |
(1,313) |
|||
Total cost of revenues |
(37,778) |
(34,584) |
(128,716) |
(101,506) |
|||
Gross profit |
6,725 |
25,307 |
41,284 |
67,400 |
|||
Operating expenses |
|||||||
Fulfillment |
(3,400) |
(6,763) |
(11,580) |
(16,934) |
|||
Selling and marketing |
(11,316) |
(12,440) |
(38,712) |
(33,232) |
|||
General and administrative |
(7,541) |
(1,559) |
(18,415) |
(15,734) |
|||
Research and development |
(2,546) |
(4,915) |
(8,382) |
(13,223) |
|||
Total operating expenses |
(24,803) |
(25,677) |
(77,089) |
(79,123) |
|||
Loss from operations |
(18,078) |
(370) |
(35,805) |
(11,723) |
|||
Exchange loss on offshore bank accounts |
20 |
— |
(23) |
— |
|||
Interest income |
205 |
49 |
432 |
246 |
|||
Interest expense |
— |
(13) |
— |
(51) |
|||
Change in fair value of convertible promissory notes |
— |
10,347 |
— |
(1,595) |
|||
Total other income/(loss) |
225 |
10,383 |
409 |
(1,400) |
|||
Income/(loss) before income taxes and gain from |
(17,853) |
10,013 |
(35,396) |
(13,123) |
|||
Income tax expense |
(3) |
(19) |
(6) |
(439) |
|||
Gain/(loss) from equity method investment |
46 |
(20) |
197 |
2,136 |
|||
Net income/(loss) |
(17,810) |
9,974 |
(35,205) |
(11,426) |
|||
Less: Net income/(loss) attributable to non-controlling |
(138) |
— |
(34) |
||||
Net income/(loss) attributable to LightInTheBox |
(17,810) |
10,112 |
(35,205) |
(11,392) |
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Weighted average numbers of shares used in |
|||||||
—Basic |
133,278,934 |
134,694,173 |
134,070,694 |
134,586,488 |
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—Diluted |
133,278,934 |
223,577,289 |
134,070,694 |
134,586,488 |
|||
Net income/(loss) per ordinary share |
|||||||
—Basic |
(0.13) |
0.08 |
(0.26) |
(0.08) |
|||
—Diluted |
(0.13) |
(0.00) |
(0.26) |
(0.08) |
|||
Net income/(loss) per ADS (2 ordinary shares equal to |
|||||||
—Basic |
(0.27) |
0.15 |
(0.53) |
(0.17) |
|||
—Diluted |
(0.27) |
(0.00) |
(0.53) |
(0.17) |
LightInTheBox Holding Co., Ltd. |
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Unaudited Reconciliations of GAAP and Non-GAAP Results |
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(U.S. dollars in thousands, or otherwise noted) |
|||||||
Three-month Period Ended |
Nine-month Period Ended |
||||||
September 30, |
September 30, |
September 30, |
September 30, |
||||
2018 |
2019 |
2018 |
2019 |
||||
Net income/(loss) |
(17,810) |
9,974 |
(35,205) |
(11,426) |
|||
Less: Interest income |
205 |
49 |
432 |
246 |
|||
Interest expense |
— |
(13) |
— |
(51) |
|||
Income tax expense |
(3) |
(19) |
(6) |
(439) |
|||
Depreciation and amortization |
(133) |
(598) |
(438) |
(1,860) |
|||
EBITDA |
(17,879) |
10,555 |
(35,193) |
(9,322) |
|||
Less: Share-based compensation |
(532) |
(305) |
(1,551) |
(1,261) |
|||
Change in fair value of convertible promissory |
— |
10,347 |
— |
(1,595) |
|||
Adjusted EBITDA* |
(17,347) |
513 |
(33,642) |
(6,466) |
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* Adjusted EBITDA represents gain/(loss) from operations before share-based compensation expense, change in fair value of |
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