ChinaCache International Holdings Ltd. (“ChinaCache” or the
“Company”) (NASDAQ:CCIH), the leading total solutions provider of
Internet content and application delivery services in China, today
announced its unaudited condensed consolidated financial results
for the third quarter ended September 30, 2016.
Third Quarter Financial
Highlights:
- Net revenues were RMB261.6 million (US$39.2
million), relatively flat compared to RMB261.5 million in the
second quarter 2016.
- Gross profit was RMB6.5 million (US$1.0
million), an improvement compared to gross loss of RMB3.9 million
in the second quarter 2016.
- Adjusted EBITDA (non-GAAP) was a loss of
RMB46.0 million (US$6.9 million), an improvement of 17.0% compared
with adjusted EBITDA loss of RMB55.4 million in the second quarter
2016.
- Net loss attributable to ordinary
shareholders was RMB94.3 million (US$14.1 million), an
improvement of 13.4% compared with net loss of RMB108.9 million in
the second quarter 2016.
Turnaround Initiatives
Underway:
- Reducing operating costs and expenses to better align with
revenues.
- Streamlining product portfolios to focus on core strength
areas.
- Prioritizing R&D activities to capture CDN opportunities in
selected technologies such as Internet security, cloud exchange and
Internet of Things (IoT).
- Monetizing investments through corporate restructuring in data
center and Internet exchange center businesses.
- Building a new generation data center network and transforming
ChinaCache from a pure CDN provider to a global content and
application-focused total solution provider, consisting of
ChinaCache IDCs (private backbone transmission lines), Internet and
cloud exchange centers, as well as extensive CDN nodes.
“In the third quarter we made steady progress in
our business and achieved quarter-over-quarter improvements in our
financial and operating results,” commented Mr. Song Wang, Chairman
and Chief Executive Officer of ChinaCache. “We have begun to
implement a series of growth initiatives and cost control measures
to transition the Company toward growth and profitability and we
are on track to execute our plan. Costs relating to streamlining
our products and processes may affect our bottom line in the near
term, however, we believe this will make us more efficient in the
long term.”
“We made several key improvements in the
business in the third quarter. Most notably, we further expanded
our Internet Exchange (CHN-IX) network in first-tier cities and are
ready to roll out customized ‘end-to-end’ total solutions through
our integrated data centers, Internet and cloud exchange centers
and vast content delivery networks (CDN). This new generation data
center network is designed to meet customer demand for lower costs
and enhanced user experiences, and is critical to driving our
market penetration in the future,” Mr. Wang continued.
“As we turn the corner to 2017, our goal is to
regain market share and emerge as the leading CDN provider in
China. To enhance our competitive position within the CDN industry,
we are transforming ourselves from a pure CDN provider to a
one-stop-shop total solutions provider. Focusing on content
and applications, we believe our new three-layer structured network
consisting of the IDCs, Internet and cloud exchange centers and
extensive CDN nodes will emerge as one of the best business models
in the Chinese CDN industry and deliver superior value to our
customers. We are in the process of deployment and are ready to
expand services.”
“Finally, to accelerate our turnaround
initiatives, we are considering a corporate restructuring program.
We plan to spin off a portion of our data center business. This
restructuring, when complete, will reduce future capital
expenditure needs, strengthen our balance sheet, and, at the same
time, allow us to participate in the future upside of the data
center operations.” concluded Mr. Wang.
Third Quarter 2016 Financial
Results
Net revenues for the third
quarter 2016 were RMB261.6 million (US$39.2 million), a 0.1%
increase from the previous quarter and a 19.5% decrease from the
corresponding period in 2015.
Cost of revenues for the third
quarter 2016 decreased by 3.9% quarter-over-quarter and 2.3%
year-over-year to RMB255.1 million (US$38.3 million). Gross margin
was 2.5%, compared with negative 1.5% in the previous quarter and
19.6% in the corresponding period in 2015. Non-GAAP gross margin,
which excludes share-based compensation, was 2.6%, compared with
negative 0.7% in the previous quarter and 19.8% in the
corresponding period in 2015. The increase in gross margin in the
third quarter of 2016 from the previous quarter was mainly
attributable to improved bandwidth utilization.
Sales and marketing expenses for the third
quarter 2016 were RMB23.0 million (US$3.5 million), or 8.8% of net
revenues, a 5.7% decrease over the previous quarter and a 18.2%
decrease from the corresponding period in 2015. The decrease in
sales and marketing expenses in the third quarter of 2016 from the
previous quarter was primarily attributable to cost control
measures.
General and administrative expenses for the
third quarter 2016 were RMB62.2 million (US$9.3 million), or 23.8%
of net revenues, a 4.4% decrease from the previous quarter and a
86.6% increase from the corresponding period in 2015. The decrease
in general and administrative expenses in the third quarter of 2016
from the previous quarter was primarily attributable to a decrease
in share-based compensation expenses.
Research and development (R&D) expenses for
the third quarter 2016 were RMB24.0 million (US$3.6 million), or
9.2% of net revenues, a 10.7% decrease from the previous quarter
and a 1.0% increase from the corresponding period in 2015. The
decrease in research and development expenses in the third quarter
of 2016 from the previous quarter was primarily attributable to
cost control measures.
Adjusted EBITDA (non-GAAP),
defined as EBITDA excluding share-based compensation expenses,
foreign exchange gain (loss) and transaction tax on assets
transfer, was a loss of RMB46.0 million (US$6.9 million) for the
third quarter 2016. Adjusted EBITDA (non-GAAP) was a loss of
RMB55.4 million in the previous quarter and RMB24.8 million in the
corresponding period in 2015.
Operating loss was RMB99.5
million (US$14.9 million) in the third quarter 2016, compared with
an operating loss of RMB119.2 million in the previous quarter and
an operating loss of RMB43.8 million in the corresponding period in
2015. Non-GAAP operating loss, which excludes share-based
compensation expenses, was RMB90.9 million (US$13.6 million) for
the third quarter 2016, compared with a non-GAAP operating loss of
RMB95.7 million in the previous quarter and a non-GAAP operating
loss of RMB40.1 million in the corresponding period in 2015.
Income tax benefit was RMB0.4
million (US$58 thousand) in the third quarter 2016, compared with
income tax benefit of RMB4.8 million in the previous quarter and
income tax expense of RMB2.7 million in the corresponding period in
2015.
Net loss was RMB94.3 million
(US$14.1 million) in the third quarter 2016, compared with a net
loss of RMB108.9 million in the previous quarter, and a net loss of
RMB39.4 million in the corresponding period in 2015. Net loss per
basic and diluted American depositary share (“ADS”) for the third
quarter 2016 was RMB3.68 (US$0.48) each. Each ADS represents 16
ordinary shares of the Company.
Adjusted net loss (non-GAAP),
defined as net loss before share-based compensation expenses and
foreign exchange gain (loss), was RMB86.6 million (US$13.0 million)
in the third quarter 2016, compared with adjusted net loss
(non-GAAP) of RMB91.4 million in the previous quarter and adjusted
net loss (non-GAAP) of RMB44.4 million in the corresponding period
in 2015. Non-GAAP net loss per basic and diluted ADS for the third
quarter 2016 was RMB3.36 (US$0.48) each.
Balance Sheet
As of September 30, 2016, the Company had cash
and cash equivalents of RMB253.0 million (US$37.9 million),
compared with RMB606.8 million as of December 31, 2015. Capital
expenditures, excluding capital expenditures on construction of
cloud infrastructure in the amount of RMB77.0 million (US$11.6
million), for the third quarter 2016 were RMB58.1 million (US$8.7
million).
Recent Developments
The audit committee of the Board of Directors of
ChinaCache (the “Audit Committee”) has authorized the Company to
explore a possible sale of 79% equity stake in ChinaCache Xin Run
Technology (Beijing) Co., Limited (“Xin Run”), while retaining 20%
equity interest in the same company, as an alternative to the
previously announced proposed sale of 60% equity stake in Xin Run
to three investors previously identified, which transaction has not
been completed so far. Mr. Song Wang intends to participate in the
transaction, along with certain other potential investor(s). It is
expected that Xin Run will be deconsolidated from the Company’s
consolidated financial statements upon the completion of such sale.
The Audit Committee intends to work with third-party professional
advisors to evaluate the detailed plans in connection with the
proposed sale of Xin Run. Any such plans will be subject to the
Audit Committee’s review and approval and ultimately the further
consideration and approval by the Company’s board of directors.
There can be no assurance that any transaction will occur as a
result of this exploration process or, if undertaken, the terms or
timing thereof.
2016 Full Year Guidance
The Company maintains its previously announced
full year 2016 total net revenues guidance. ChinaCache expects to
generate total net revenues in the range of RMB1.04 billion to
RMB1.1 billion for the full year 2016.
This forecast reflects ChinaCache's current
view, which is subject to change.
Conference Call
Information
The Company has scheduled a conference call to
discuss these results at 8:00 PM Eastern time on November 29, 2016,
which corresponds to 9:00 AM Beijing time on November 30, 2016.
The dial-in details for the live conference call are as
follows:
- U.S. dial-in number: +1 (845) 675-0438
- Hong Kong dial-in number: +852 3018-6776
- International dial-in number: +65 6713-5440
- China dial-in number: 400-1200-654
- Conference ID: 18620531
A live and archived webcast of the conference call can be
accessed on the Company’s investor relations website at
ir.chinacache.com. An audio replay of the conference call
will be available approximately two hours after the live call,
until December 6, 2016, by dialing:
- U.S. dial-in number: +1 (855) 452-5696
- International dial-in number: +61 (2)
9003-4211
- China dial-in number: 400-632-2162
- Conference ID: 18620531
About ChinaCache International Holdings
Ltd.
ChinaCache International Holdings Ltd.
(Nasdaq:CCIH) is the leading total solutions provider of Internet
content and application delivery services in China. As a
carrier-neutral service provider, ChinaCache's network in China is
interconnected with networks operated by all telecom carriers,
major non-carriers and local Internet service providers. With more
than a decade of experience in developing solutions tailored to
China's complex Internet infrastructure, ChinaCache is the partner
of choice for businesses, government agencies and other enterprises
to enhance the reliability and scalability of online services and
applications and improve end-user experience. For more information
on ChinaCache, please visit ir.chinacache.com.
Use of Non-GAAP Financial
Measures
In evaluating its business, ChinaCache considers
and uses the following non-GAAP measures defined as non-GAAP
financial measures by the SEC as supplemental measures to review
and assess its operating performance: non-GAAP gross profit,
non-GAAP sales and marketing expenses, non-GAAP general and
administrative expenses, non-GAAP research and development
expenses, non-GAAP operating income (loss), adjusted net income
(loss) (non-GAAP), EBITDA and adjusted EBITDA (non-GAAP). The
presentation of these non-GAAP financial measures is not intended
to be considered in isolation 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 “Reconciliations of Non-GAAP to GAAP
Financial Measures" set forth at the end of this press release.
To present non-GAAP sales and marketing
expenses, non-GAAP general and administrative expenses and non-GAAP
research and development expenses, the Company excludes share-based
compensation expense.
To present non-GAAP gross profit (loss), the
Company excludes share-based compensation expense.
To present non-GAAP operating income (loss), the
Company excludes share-based compensation expense.
The Company defines adjusted net income (loss)
as net income (loss) before share-based compensation expense and
foreign exchange gain (loss).
The Company uses EBITDA to assist in
reconciliation to adjusted EBITDA. The Company defines EBITDA as
net income (loss) before interest expense, interest income, income
tax expense (benefit) and depreciation and amortization. The
Company defines adjusted EBITDA as EBITDA before share-based
compensation expense, foreign exchange gain (loss) and transaction
tax on assets transfer that the Company does not consider
reflective of its ongoing operations. The Company believes that the
use of adjusted EBITDA facilitates investors' use of operating
performance comparisons from period to period and company to
company by backing out potential differences caused by variations
in items such as capital structure (affecting relative interest
expense and share-based compensation expense), the book
amortization of intangibles (affecting relative amortization
expense), the age and book value of facilities and equipment
(affecting relative depreciation expense) and other non-cash
expenses. The Company also presents adjusted EBITDA because it
believes it is frequently used by securities analysts, investors
and other interested parties as a measure of the financial
performance of companies in its industry.
Those non-GAAP financial measures are not
defined under U.S. GAAP and are not measures presented in
accordance with U.S. GAAP. Those non-GAAP financial measures have
limitations as analytical tools, and when assessing the Company's
operating performance, investors should not consider them in
isolation, or as a substitute for net income or other consolidated
income statement data prepared in accordance with U.S. GAAP. Some
of these limitations include, but are not limited to:
- Adjusted net income, EBITDA and adjusted EBITDA do not reflect
the Company's cash expenditures or future requirements for capital
expenditures or contractual commitments;
- They do not reflect changes in, or cash requirements for, the
Company's working capital needs;
- They do not reflect the interest expense, or the cash
requirements necessary to service interest or principal payments,
on the Company's debt;
- They do not reflect income taxes or the cash requirements for
any tax payments;
- Although depreciation and amortization are non-cash charges,
the assets being depreciated and amortized often will have to be
replaced in the future, and adjusted net income, EBITDA and
adjusted EBITDA do not reflect any cash requirements for such
replacements;
- While share-based compensation is a component of cost of
revenues and operating expenses, the impact on the Company's
financial statements compared to other companies can vary
significantly due to such factors as assumed life of the options
and assumed volatility of the Company's ordinary shares; and
- Other companies may calculate adjusted net income, EBITDA and
adjusted EBITDA differently than the Company does, limiting their
usefulness as comparative measures.
Exchange Rate Information
This announcement contains translations of
certain Renminbi amounts into U.S. dollars at a specified rate
solely for the convenience of the reader. Unless otherwise
noted, all translations from Renminbi to U.S. dollars are based on
the effective exchange rate of 6.6685, the noon-buying rate as of
September 30, 2016 as set forth in the H.10 statistical release of
the Federal Reserve Board.
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 outlook for the full year 2016 the
Company's turnaround initiatives and quotations from management in
this announcement, as well as ChinaCache’s strategic and
operational plans, contain forward-looking statements. ChinaCache
may also make written or oral forward-looking statements in its
reports filed or furnished to the U.S. Securities and Exchange
Commission, in its annual reports to shareholders, in press
releases and other written materials and in oral statements made by
its officers, directors or employees to third 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
statements, including but not limited to the following: the
Company’s goals and strategies, expansion plans, the expected
growth of the content and application delivery services market, the
Company’s expectations regarding keeping and strengthening its
relationships with its customers, and the general economic and
business conditions in the regions where the Company provides its
solutions and services. Further information regarding these and
other risks is included in the Company’s filings with the U.S.
Securities and Exchange Commission. All information provided in
this press release is as of the date of this press release, and
ChinaCache undertakes no duty to update such information, except as
required under applicable law.
|
|
|
|
|
|
|
|
|
|
Condensed Consolidated Balance
Sheets |
|
(amounts in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of Dec 31 |
|
As of Sep 30 |
|
As of Sep 30 |
|
|
|
|
|
2015 |
|
2016 |
|
2016 |
|
|
|
|
|
RMB |
|
RMB |
|
US$ |
|
|
|
|
|
(Audited) |
|
(Unaudited) |
|
(Unaudited) |
|
ASSETS |
|
|
|
|
|
|
|
Current
assets |
|
|
|
|
|
|
|
|
Cash and
cash equivalents |
|
606,796 |
|
252,968 |
|
37,935 |
|
|
Accounts receivable, net |
243,431 |
|
187,131 |
|
28,062 |
|
|
Prepaid
expenses and other current assets |
|
31,560 |
|
46,831 |
|
7,023 |
|
|
Short term
investments |
|
26,169 |
|
- |
|
- |
|
|
Deferred
tax assets |
|
17,923 |
|
17,151 |
|
2,572 |
|
|
Amount due
from a subsidiary held for sale |
|
435 |
|
204 |
|
31 |
|
|
Assets held
for sale |
|
1,060,543 |
|
1,001,229 |
|
150,143 |
|
|
|
Total current
assets |
|
1,986,857 |
|
1,505,514 |
|
225,766 |
|
|
|
|
|
|
|
|
|
|
|
Non-current
assets |
|
|
|
|
|
|
|
|
Property
and equipment, net |
|
499,946 |
|
429,146 |
|
64,354 |
|
|
Intangible
assets, net |
|
10,898 |
|
12,340 |
|
1,850 |
|
|
Long term
investments |
|
50,157 |
|
50,913 |
|
7,635 |
|
|
Deferred
tax assets |
|
11,368 |
|
18,890 |
|
2,833 |
|
|
Long term
deposits and other non-current assets |
|
59,390 |
|
41,669 |
|
6,249 |
|
|
|
Total non-current
assets |
|
631,759 |
|
552,958 |
|
82,921 |
|
|
|
|
|
|
|
|
|
|
|
Total Assets |
|
2,618,616 |
|
2,058,472 |
|
308,687 |
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS'
EQUITY |
|
|
|
|
|
|
|
Current
Liabilities |
|
|
|
|
|
|
|
|
Short-term
loan |
|
- |
|
9,371 |
|
1,405 |
|
|
Accounts
payable |
|
205,593 |
|
307,755 |
|
46,151 |
|
|
Accrued
employee benefits |
|
44,690 |
|
39,055 |
|
5,857 |
|
|
Accrued
expenses and other payables |
|
76,409 |
|
37,588 |
|
5,637 |
|
|
Income tax
payable |
|
13,513 |
|
15,073 |
|
2,260 |
|
|
Liabilities
for uncertain tax positions |
|
11,337 |
|
11,337 |
|
1,700 |
|
|
Amounts due
to related parties |
|
18 |
|
18 |
|
3 |
|
|
Current
portion of long term loan |
|
7,180 |
|
7,180 |
|
1,077 |
|
|
Current
portion of capital lease obligations |
|
70,615 |
|
77,204 |
|
11,577 |
|
|
Deferred
government grant |
|
16,360 |
|
13,000 |
|
1,949 |
|
|
Amount due
to a subsidiary held for sale |
|
319,536 |
|
55,787 |
|
8,366 |
|
|
Liabilities
held for sale |
|
1,014,449 |
|
986,410 |
|
147,921 |
|
|
|
Total current
liabilities |
|
1,779,700 |
|
1,559,778 |
|
233,903 |
|
|
|
|
|
|
|
|
|
|
|
Non-current
liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term loan |
|
4,340 |
|
- |
|
- |
|
|
|
Non-current portion of
capital lease obligations |
|
104,450 |
|
58,956 |
|
8,841 |
|
|
|
Deferred government
grant |
|
8,439 |
|
13,399 |
|
2,009 |
|
|
|
Total
non-current liabilities |
|
117,229 |
|
72,355 |
|
10,850 |
|
|
|
|
|
|
|
|
|
|
|
Total
Liabilities |
|
1,896,929 |
|
1,632,133 |
|
244,753 |
|
|
|
|
|
|
|
|
|
|
|
Total
Shareholders' equity |
|
721,687 |
|
426,339 |
|
63,934 |
|
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY |
2,618,616 |
|
2,058,472 |
|
308,687 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Condensed Consolidated Statements of
Comprehensive Income |
|
|
(amounts in thousands, except for number of shares,
per share and per ADS data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended |
|
|
|
|
|
|
|
|
|
|
|
Sep 30, 2015 |
|
Jun 30, 2016 |
|
Sep 30, 2016 |
|
Sep 30, 2016 |
|
|
|
|
|
|
|
|
|
|
|
RMB |
|
RMB |
|
RMB |
|
US$ |
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
(Unaudited) |
|
(Unaudited) |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
revenues |
|
|
|
325,091 |
|
|
|
261,503 |
|
|
|
261,643 |
|
|
|
39,236 |
|
|
|
|
Cost of revenues |
|
|
|
(261,250 |
) |
|
|
(265,376 |
) |
|
|
(255,133 |
) |
|
|
(38,259 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit (loss) |
|
|
|
63,841 |
|
|
|
(3,873 |
) |
|
|
6,510 |
|
|
|
977 |
|
|
|
|
|
Other
operating income |
|
|
|
- |
|
|
|
1,010 |
|
|
|
3,260 |
|
|
|
489 |
|
|
|
|
|
Sales &
marketing expenses |
|
|
|
(28,117 |
) |
|
|
(24,402 |
) |
|
|
(23,009 |
) |
|
|
(3,450 |
) |
|
|
|
|
General
& administrative expenses |
|
|
|
(33,341 |
) |
|
|
(65,036 |
) |
|
|
(62,202 |
) |
|
|
(9,328 |
) |
|
|
|
|
Research
& development expenses |
|
|
|
(23,799 |
) |
|
|
(26,931 |
) |
|
|
(24,037 |
) |
|
|
(3,605 |
) |
|
|
|
|
Transaction
tax on assets transfer |
|
|
|
(22,339 |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating loss |
|
|
|
(43,755 |
) |
|
|
(119,232 |
) |
|
|
(99,478 |
) |
|
|
(14,917 |
) |
|
|
|
|
Interest
income |
|
|
|
533 |
|
|
|
2,361 |
|
|
|
1,627 |
|
|
|
244 |
|
|
|
|
|
Interest
expense |
|
|
|
(3,234 |
) |
|
|
(3,218 |
) |
|
|
(2,932 |
) |
|
|
(440 |
) |
|
|
|
|
Other
income |
|
|
|
1,114 |
|
|
|
432 |
|
|
|
5,171 |
|
|
|
775 |
|
|
|
|
|
Foreign
exchange gain, net |
|
|
|
8,606 |
|
|
|
6,031 |
|
|
|
915 |
|
|
|
137 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss before income taxes |
|
|
|
(36,736 |
) |
|
|
(113,626 |
) |
|
|
(94,697 |
) |
|
|
(14,201 |
) |
|
|
|
|
Income tax (expense) benefit |
|
|
|
(2,652 |
) |
|
|
4,776 |
|
|
|
384 |
|
|
|
58 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss |
|
|
|
|
(39,388 |
) |
|
|
(108,850 |
) |
|
|
(94,313 |
) |
|
|
(14,143 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
attributable to the noncontrolling interest |
|
|
|
- |
|
|
|
(91 |
) |
|
|
(152 |
) |
|
|
(23 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss attributable to the Company's shareholders |
|
|
(39,388 |
) |
|
|
(108,759 |
) |
|
|
(94,161 |
) |
|
|
(14,120 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign
currency translation |
|
|
|
(103 |
) |
|
|
422 |
|
|
|
(196 |
) |
|
|
(29 |
) |
|
|
|
Unrealized
holding gain on available-for-sale investments |
|
|
249 |
|
|
|
190 |
|
|
|
36 |
|
|
|
5 |
|
|
|
|
Reclassification adjustments for gains included in net income |
|
|
- |
|
|
|
- |
|
|
|
(3,741 |
) |
|
|
(561 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total other comprehensive income (loss), net of
tax |
|
|
146 |
|
|
|
612 |
|
|
|
(3,901 |
) |
|
|
(585 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive loss |
|
|
|
(39,242 |
) |
|
|
(108,238 |
) |
|
|
(98,214 |
) |
|
|
(14,728 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive loss attributable to the noncontrolling interest |
|
|
- |
|
|
|
(91 |
) |
|
|
(152 |
) |
|
|
(23 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive loss attributable to the Company's
shareholders |
|
(39,242 |
) |
|
|
(108,147 |
) |
|
|
(98,062 |
) |
|
|
(14,705 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss per ordinary share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
|
|
(0.09 |
) |
|
|
(0.27 |
) |
|
|
(0.23 |
) |
|
|
(0.03 |
) |
|
|
|
|
Diluted |
|
|
|
|
(0.09 |
) |
|
|
(0.27 |
) |
|
|
(0.23 |
) |
|
|
(0.03 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss per ADS*: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
|
|
(1.49 |
) |
|
|
(4.31 |
) |
|
|
(3.68 |
) |
|
|
(0.48 |
) |
|
|
|
|
Diluted |
|
|
|
|
(1.49 |
) |
|
|
(4.31 |
) |
|
|
(3.68 |
) |
|
|
(0.48 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of ordinary shares used in earnings
per share computation: |
|
|
|
|
|
|
|
|
Basic |
|
|
|
|
422,294,433 |
|
|
|
403,422,017 |
|
|
|
412,253,323 |
|
|
|
412,253,323 |
|
|
|
|
|
Diluted |
|
|
|
|
422,294,433 |
|
|
|
403,422,017 |
|
|
|
412,253,323 |
|
|
|
412,253,323 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* |
Note1:1 ADS
= 16 shares |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplementary Metrics - Reconciliations of
Non-GAAP to GAAP Financial Measures |
|
|
|
|
|
|
|
|
|
|
|
|
|
(amounts in thousands, except for percentages, number
of shares, per share and per ADS data) |
|
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended |
|
|
|
|
|
|
|
|
Sep 30, 2015 |
|
Jun 30, 2016 |
|
Sep 30, 2016 |
|
Sep 30, 2016 |
|
|
|
|
|
|
|
|
RMB |
|
RMB |
|
RMB |
|
US$ |
|
|
|
Adjusted EBITDA — defined as EBITDA before share-based
compensation expense, foreign exchange gain and transaction tax on
assets transfer |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss |
|
|
|
(39,388 |
) |
|
|
(108,850 |
) |
|
|
(94,313 |
) |
|
|
(14,143 |
) |
|
|
|
Depreciation |
|
|
40,519 |
|
|
|
39,144 |
|
|
|
38,653 |
|
|
|
5,796 |
|
|
|
|
Amortization |
|
|
981 |
|
|
|
796 |
|
|
|
1,102 |
|
|
|
165 |
|
|
|
|
Interest expense |
|
|
3,234 |
|
|
|
3,218 |
|
|
|
2,932 |
|
|
|
440 |
|
|
|
|
Interest income |
|
|
(533 |
) |
|
|
(2,361 |
) |
|
|
(1,627 |
) |
|
|
(244 |
) |
|
|
|
Income tax expense (benefit) |
|
|
2,652 |
|
|
|
(4,776 |
) |
|
|
(384 |
) |
|
|
(58 |
) |
|
|
|
Share-based compensation |
|
|
3,615 |
|
|
|
23,492 |
|
|
|
8,601 |
|
|
|
1,290 |
|
|
|
|
Foreign exchange gain |
|
|
(8,606 |
) |
|
|
(6,031 |
) |
|
|
(915 |
) |
|
|
(137 |
) |
|
|
|
Transaction tax on assets transfer |
|
|
22,339 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
Adjusted EBITDA |
|
|
24,813 |
|
|
|
(55,368 |
) |
|
|
(45,951 |
) |
|
|
(6,891 |
) |
|
|
|
|
Margin% |
|
|
7.6 |
% |
|
|
(21.2 |
%) |
|
|
(17.6 |
%) |
|
|
(17.6 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net loss— defined as net loss before share-based
compensation and foreign exchange gain |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss |
|
|
|
(39,388 |
) |
|
|
(108,850 |
) |
|
|
(94,313 |
) |
|
|
(14,143 |
) |
|
|
|
Share-based
compensation |
|
|
3,615 |
|
|
|
23,492 |
|
|
|
8,601 |
|
|
|
1,290 |
|
|
|
|
Foreign exchange gain |
|
|
(8,606 |
) |
|
|
(6,031 |
) |
|
|
(915 |
) |
|
|
(137 |
) |
|
|
|
Adjusted net loss |
|
|
(44,379 |
) |
|
|
(91,389 |
) |
|
|
(86,627 |
) |
|
|
(12,990 |
) |
|
|
|
|
Margin% |
|
|
(13.7 |
%) |
|
|
(34.9 |
%) |
|
|
(33.1 |
%) |
|
|
(33.1 |
%) |
|
|
|
Loss per ordinary share: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
|
(0.11 |
) |
|
|
(0.23 |
) |
|
|
(0.21 |
) |
|
|
(0.03 |
) |
|
|
|
|
Diluted |
|
|
(0.11 |
) |
|
|
(0.23 |
) |
|
|
(0.21 |
) |
|
|
(0.03 |
) |
|
|
|
Loss per ADS: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
|
(1.68 |
) |
|
|
(3.62 |
) |
|
|
(3.36 |
) |
|
|
(0.48 |
) |
|
|
|
|
Diluted |
|
|
(1.68 |
) |
|
|
(3.62 |
) |
|
|
(3.36 |
) |
|
|
(0.48 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP gross profit (loss) – defined as gross profit (loss)
before share-based compensation expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit (loss) |
|
|
63,841 |
|
|
|
(3,873 |
) |
|
|
6,510 |
|
|
|
977 |
|
|
|
|
Plus: Share-based compensation |
|
|
419 |
|
|
|
2,127 |
|
|
|
378 |
|
|
|
57 |
|
|
|
|
Non-GAAP gross profit (loss) |
|
|
64,260 |
|
|
|
(1,746 |
) |
|
|
6,888 |
|
|
|
1,034 |
|
|
|
|
|
Margin% |
|
|
19.8 |
% |
|
|
(0.7 |
%) |
|
|
2.6 |
% |
|
|
2.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP operating expense – defined as operating expense
before share-based compensation expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales & marketing expenses |
|
|
28,117 |
|
|
|
24,402 |
|
|
|
23,009 |
|
|
|
3,450 |
|
|
|
|
Minus: Share-based compensation |
|
|
(262 |
) |
|
|
(1,334 |
) |
|
|
131 |
|
|
|
20 |
|
|
|
|
Non-GAAP sales & marketing expenses |
|
|
27,855 |
|
|
|
23,068 |
|
|
|
23,140 |
|
|
|
3,470 |
|
|
|
|
|
% of net
revenues |
|
|
8.6 |
% |
|
|
8.8 |
% |
|
|
8.8 |
% |
|
|
8.8 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General & administrative expenses |
|
|
33,341 |
|
|
|
65,036 |
|
|
|
62,202 |
|
|
|
9,328 |
|
|
|
|
Minus: Share-based compensation |
|
|
(2,898 |
) |
|
|
(18,601 |
) |
|
|
(8,092 |
) |
|
|
(1,213 |
) |
|
|
|
Non-GAAP general & administrative
expenses |
|
|
30,443 |
|
|
|
46,435 |
|
|
|
54,110 |
|
|
|
8,115 |
|
|
|
|
|
% of net
revenues |
|
|
9.4 |
% |
|
|
17.8 |
% |
|
|
20.7 |
% |
|
|
20.7 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research & development expenses |
|
|
23,799 |
|
|
|
26,931 |
|
|
|
24,037 |
|
|
|
3,605 |
|
|
|
|
Minus: Share-based compensation |
|
|
(36 |
) |
|
|
(1,430 |
) |
|
|
(262 |
) |
|
|
(39 |
) |
|
|
|
Non-GAAP research & development expenses |
|
|
23,763 |
|
|
|
25,501 |
|
|
|
23,775 |
|
|
|
3,566 |
|
|
|
|
|
% of net
revenues |
|
|
7.3 |
% |
|
|
9.8 |
% |
|
|
9.1 |
% |
|
|
9.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP operating loss — defined as GAAP operating loss before
share-based compensation expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating loss |
|
|
(43,755 |
) |
|
|
(119,232 |
) |
|
|
(99,478 |
) |
|
|
(14,917 |
) |
|
|
|
Plus: Share-based compensation |
|
|
3,615 |
|
|
|
23,492 |
|
|
|
8,601 |
|
|
|
1,290 |
|
|
|
|
Non-GAAP operating loss |
|
|
(40,140 |
) |
|
|
(95,740 |
) |
|
|
(90,877 |
) |
|
|
(13,627 |
) |
|
|
|
|
Margin% |
|
|
(12.3 |
%) |
|
|
(36.6 |
%) |
|
|
(34.7 |
%) |
|
|
(34.7 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For investor and media inquiries please contact:
Investor Relations Department
ChinaCache International Holdings
Tel: +86 (10) 6408 5307
Email: ir@chinacache.com
Mr. Ross Warner
The Piacente Group | Investor Relations
Tel: +86 10 6535-0149
Email: chinacache@tpg-ir.com
Ms. Brandi Piacente
The Piacente Group | Investor Relations
Tel: +1 212-481 2050
Email: chinacache@tpg-ir.com
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