21Vianet Group, Inc. (Nasdaq:VNET) ("21Vianet" or the "Company"), a
leading carrier-neutral internet data center services provider in
China, today announced its unaudited financial results for the
first quarter ended March 31, 2017. The Company will hold a
conference call at 8:00 p.m. Eastern Time on Thursday, May 25,
2017. Dial-in details are provided at the end of the release.
Mr. Steve Zhang, Chief Executive Officer of the
Company, stated, "We started 2017 with solid execution and
improvement on our overall financial and operating results, as our
restructuring efforts started to bear fruit. In particular, our
hosting and related services continued to witness strong growth
momentum in the first quarter, but was partially offset by the
competitive challenges we faced in our managed network services
(MNS) business. With respect to the development of our partnership
with Warburg Pincus, we are finalizing one of the asset transfers
for the initial joint venture, as well as exploring new data center
project opportunities. In addition, by leveraging our abundant
partnership resources and strong expertise and technology
advantages, we aim to provide more hybrid IT services that
encompass all customer needs. Going forward, we will continue our
restructuring efforts by focusing on expanding our core retail
colocation business as well as our cloud-neutral platform,
optimizing our MNS business, shifting towards an asset-light
business model, and capitalizing upon the new growth opportunities
in the market such as wholesale data center services and hybrid IT
solutions. We are confident in our ability to fortify our leading
position as an internet infrastructure services provider and
generate incremental value for our shareholders.”
Mr. Terry Wang, Chief Financial Officer of the
Company, further commented, "In the first quarter of 2017, our
total net revenues was RMB862.2 million, which came in above the
mid-point of our guidance. This was primarily due to an increase in
revenue from our core hosting and related services business, which
grew 18.5% year-over-year. We were able to expand the number of
cabinets while improving our utilization rate. We increased the
number of self-built cabinets while simultaneously decreasing the
number of partnered cabinets, which had a positive effect on our
gross margins. And while revenues from MNS declined, we implemented
cost controls and expense reduction measures to limit the impact on
EBITDA. As a result, our overall adjusted EBITDA was RMB100.3
million, exceeding the high-end of our guidance, and net loss
narrowed by 22.8% to RMB116.8 million. These results can be
directly linked to the strong execution of our business
restructuring strategy. As we move forward with our restructuring
plan, we believe we are well positioned to further drive topline
growth, lift operational efficiency and improve our
profitability.”
First Quarter 2017 Financial
Results
REVENUES: Net revenues were
RMB862.2 million (US$125.3 million) in the first quarter of 2017
compared to RMB862.3 million in the comparative period in 2016. Net
revenues remained flat due to the increase in revenues from hosting
and related services being offset by the decrease in revenues from
MNS.
Net revenues for hosting and related services
were RMB706.7 million (US$102.7 million) in the first quarter of
2017 compared to RMB596.5 million in the comparative period in
2016. The increase was primarily due to an increase in total number
of billable cabinets and utilization rate.
Net revenues for MNS were RMB155.5 million
(US$22.6 million) in the first quarter of 2017 compared to RMB265.8
million in the comparative period in 2016. The decrease was
primarily due to intensified competition and pricing pressure.
GROSS PROFIT: Gross profit was
RMB180.5 million (US$26.2 million) in the first quarter of 2017
compared to RMB169.0 million in the comparative period in 2016.
Gross margin was 20.9% in the first quarter of 2017 compared to
19.6% in the comparative period in 2016. The increase was primarily
due to a shift towards more self-built cabinets and a reduction in
the number of partnered cabinets.
Adjusted gross profit, which excludes
share-based compensation expenses and amortization of intangible
assets derived from acquisitions, was RMB211.6 million (US$30.7
million) in the first quarter of 2017 compared to RMB211.1 million
in the comparative period in 2016. Adjusted gross margin was 24.5%
in the first quarter of 2017 compared to 24.5% in the comparative
period in 2016.
OPERATING EXPENSES: Total
operating expenses was RMB252.6 million (US$36.7 million) in the
first quarter of 2017 compared to RMB254.5 million in the
comparative period in 2016.
Adjusted operating expenses, which excludes
share-based compensation expenses and changes in the fair value of
contingent purchase consideration payable, were RMB250.9 million
(US$36.5 million) in the first quarter of 2017 compared to RMB219.5
million in the comparative period in 2016. As a percentage of net
revenues, adjusted operating expenses were 29.1% in the first
quarter of 2017 compared to 25.5% in the comparative period in
2016.
Sales and marketing expenses were RMB65.8
million (US$9.6 million) in the first quarter of 2017 compared to
RMB77.3 million in the comparative period in 2016. The decrease was
primarily due to reduced agency fees.
General and administrative expenses were
RMB135.8 million (US$19.7 million) in the first quarter of 2017
compared to RMB133.8 million in the comparative period in 2016.
Research and development expenses were RMB38.4
million (US$5.6 million) in the first quarter of 2017 compared to
RMB41.9 million in the comparative period in 2016.
Bad debt provisions were RMB15.5 million (US$2.2
million) in the first quarter of 2017. We had negligible bad debt
provisions in the comparative period in 2016.
Changes in the fair value of contingent purchase
consideration payable was a gain of RMB2.9 million (US$0.4 million)
in the first quarter of 2017 compared to a loss of RMB1.5 million
in the comparative period in 2016.
ADJUSTED EBITDA: Adjusted
EBITDA, which excludes share-based compensation expenses and
changes in the fair value of contingent purchase consideration
payable was RMB100.3 million (US$14.6 million) in the first quarter
of 2017 compared to RMB108.6 million in the comparative period in
2016. Adjusted EBITDA margin was 11.6% in the first quarter of 2017
compared to 12.6% in the comparative period in 2016.
Adjusted EBITDA for hosting and related services
was RMB152.7 million (US$22.2 million) in the first quarter of 2017
compared to RMB94.1 million in the comparative period in 2016.
Adjusted EBITDA for MNS was negative RMB52.4
million (US$7.6 million) in the first quarter of 2017 compared to
positive RMB14.5 million in the comparative period in 2016.
NET PROFIT/LOSS: Net loss was
RMB116.8 million (US$17.0 million) in the first quarter of 2017
compared to RMB151.3 million in the comparative period in 2016.
Adjusted net loss, which excludes share-based
compensation expenses, amortization of intangible assets derived
from acquisitions, and changes in the fair value of contingent
purchase consideration payable and related deferred tax impact, was
RMB84.0 million (US$12.2 million) in the first quarter of 2017
compared to RMB73.8 million in the comparative period in 2016.
Adjusted net margin was negative 9.7% in the first quarter of 2017
compared to negative 8.6% in the comparative period in 2016.
LOSS PER SHARE: Diluted loss
per share was RMB0.17 in the first quarter of 2017, which
represents the equivalent of RMB1.02 (US$0.15) per American
Depositary Share ("ADS"). Each ADS represents six ordinary
shares.
Adjusted diluted loss per share was RMB0.12 in
the first quarter of 2017, which represents the equivalent of
RMB0.72 (US$0.10) per ADS. Adjusted diluted loss per share is
calculated using adjusted net loss divided by the weighted average
number of shares.
As of March 31, 2017, the Company had a total of
678.6 million ordinary shares outstanding, or the equivalent of
113.1 million ADS.
BALANCE SHEET: As of March 31,
2017, the Company's cash and cash equivalents and short-term
investment were RMB1.26 billion (US$183.7 million).
First quarter 2017 Operational Highlights
- Monthly Recurring Revenues ("MRR") per cabinet was RMB8,363 in
the first quarter of 2017, compared to RMB8,490 in the fourth
quarter of 2016.
- Total cabinets under management increased to 26,394 as of March
31, 2017 from 26,380 as of December 31, 2016, with 19,518 cabinets
in the Company's self-built data centers and 6,876 cabinets in its
partnered data centers.
- Utilization rate increased to 75.8% in the first quarter of
2017, compared to 75.2% in the fourth quarter of 2016.
- Hosting churn rate, which is based on the Company’s core IDC
business, was 0.48% in the first quarter of 2017, compared to 0.55%
in the fourth quarter of 2016.
Recent Developments
In late March of 2017, the Company was approved
as a silver level partner for Akamai’s NetAlliance Program. As a
NetAlliance partner, the Company will be able to leverage the
exceptional brand of Akamai, a global leader in Content Delivery
Network (CDN) services, to profitably grow 21Vianet’s CDN
business.
Financial Outlook
For the second quarter of 2017, the Company
expects net revenues to be in the range of RMB870 million to RMB910
million, compared to RMB910.8 million in the prior year period.
Adjusted EBITDA is expected to be in the range of RMB100 million to
RMB120 million, compared to RMB15.5 million in the prior year
period.
Conference Call
The Company will hold a conference call on
Thursday, May 25, 2017 at 8:00 pm U.S. Eastern Time, or Friday, May
26, 2017 at 8:00 am Beijing Time to discuss the financial
results.
|
Participants may access the call by dialing the following
numbers: |
| |
|
| United States Toll
Free: |
+1-855-500-8701 |
| International: |
+65-6713-5440 |
| China Domestic: |
400-120-0654 |
| Hong Kong: |
+852-3018-6776 |
| Conference ID: |
16187549 |
| |
|
| The replay
will be accessible through June 2, 2017, by dialing the following
numbers: |
| |
|
| United States Toll
Free: |
+1-855-452-5696 |
| International: |
+61-2-9003-4211 |
| Conference ID: |
16187549 |
A live and archived webcast of the conference
call will be available through the Company's investor relation
website at http://ir.21vianet.com.
Non-GAAP Disclosure
In evaluating its business, 21Vianet considers
and uses the following non-GAAP measures defined as non-GAAP
financial measures by the SEC as supplemental measure to review and
assess its operating performance: adjusted gross profit, adjusted
gross margin, adjusted operating expenses, adjusted net profit,
adjusted net margin, adjusted EBITDA, adjusted EBITDA margin,
adjusted basic earnings per share, adjusted diluted earnings per
share, adjusted basic earnings per ADS and adjusted diluted
earnings per ADS. 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 GAAP and non-GAAP results" set forth at the end of this press
release.
The non-GAAP financial measures are provided as
additional information to help investors compare business trends
among different reporting periods on a consistent basis and to
enhance investors' overall understanding of the Company's current
financial performance and prospects for the future. These non-GAAP
financial measures should be considered in addition to results
prepared in accordance with U.S. GAAP, but should not be considered
a substitute for, or superior to, U.S. GAAP results. In addition,
the Company's calculation of the non-GAAP financial measures may be
different from the calculation used by other companies, and
therefore comparability may be limited.
Exchange Rate
This announcement contains translations of
certain RMB amounts into U.S. dollars (“USD”) at specified rates
solely for the convenience of the reader. Unless otherwise stated,
all translations from RMB to USD were made at the rate of RMB6.8832
to US$1.00, the noon buying rate in effect on March 31, 2017 in the
H.10 statistical release of the Federal Reserve Board. The Company
makes no representation that the RMB or USD amounts referred could
be converted into USD or RMB, as the case may be, at any particular
rate or at all. For analytical presentation, all percentages are
calculated using the numbers presented in the financial statements
contained in this earnings release.
Statement Regarding Unaudited Condensed
Financial Information
The unaudited financial information set forth
above is preliminary and subject to potential adjustments.
Adjustments to the consolidated financial statements may be
identified when audit work has been performed for the Company's
year-end audit, which could result in significant differences from
this preliminary unaudited condensed financial information.
About 21Vianet
21Vianet Group, Inc. is a leading
carrier-neutral Internet data center services provider in China.
21Vianet provides hosting and related services, managed network
services, cloud services, content delivery network services,
last-mile wired broadband services and business VPN services,
improving the reliability, security and speed of its customers'
Internet infrastructure. Customers may locate their servers and
networking equipment in 21Vianet's data centers and connect to
China's Internet backbone through 21Vianet's extensive fiber optic
network. In addition, 21Vianet's proprietary smart routing
technology enables customers' data to be delivered across the
Internet in a faster and more reliable manner. 21Vianet operates in
more than 30 cities throughout China, servicing a diversified and
loyal base of more than 4,000 hosting enterprise customers that
span numerous industries ranging from Internet companies to
government entities and blue-chip enterprises to small- to
mid-sized enterprises
Safe Harbor Statement
This announcement contains forward-looking
statements. These forward-looking statements are made under the
"safe harbor" provisions of the U.S. Private Securities Litigation
Reform Act of 1995. These statements can be identified by
terminology such as "will," "expects," "anticipates," "future,"
"intends," "plans," "believes," "estimates" and similar statements.
Among other things, quotations from management in this announcement
as well as 21Vianet's strategic and operational plans contain
forward-looking statements. 21Vianet may also make written or oral
forward-looking statements in its reports filed with, 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. Statements that are not historical
facts, including statements about 21Vianet's beliefs and
expectations, are forward-looking statements. 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: 21Vianet's goals and strategies;
21Vianet's expansion plans; the expected growth of the data center
services market; expectations regarding demand for, and market
acceptance of, 21Vianet's services; 21Vianet's expectations
regarding keeping and strengthening its relationships with
customers; 21Vianet's plans to invest in research and development
to enhance its solution and service offerings; and general economic
and business conditions in the regions where 21Vianet provides
solutions and services. Further information regarding these and
other risks is included in 21Vianet's reports filed with, or
furnished to, the Securities and Exchange Commission. All
information provided in this press release and in the attachments
is as of the date of this press release, and 21Vianet undertakes no
duty to update such information, except as required under
applicable law.
| |
| 21VIANET GROUP, INC. |
| CONSOLIDATED BALANCE SHEETS |
| (Amount in thousands of Renminbi (“RMB”) and US
dollars (“US$”)) |
| |
|
|
| |
As of |
As of |
| |
|
|
|
|
December 31, 2016 |
March 31, 2017 |
|
| |
RMB |
RMB |
|
US$ |
|
| |
(Audited) |
(Unaudited) |
|
(Unaudited) |
|
|
Assets |
|
|
|
|
|
|
| Current
assets: |
|
|
|
|
|
|
| Cash and cash
equivalents |
1,297,418 |
|
779,513 |
|
113,249 |
|
| Restricted cash |
1,963,561 |
|
2,065,166 |
|
300,030 |
|
| Accounts and notes
receivable, net |
655,459 |
|
720,858 |
|
104,727 |
|
| Short-term
investments |
277,946 |
|
484,949 |
|
70,454 |
|
| Inventories |
4,431 |
|
4,585 |
|
666 |
|
| Prepaid expenses and
other current assets |
777,131 |
|
862,661 |
|
125,328 |
|
| Amount due from related
parties |
182,615 |
|
183,546 |
|
26,666 |
|
|
Total current assets |
5,158,561 |
|
5,101,278 |
|
741,120 |
|
| Non-current
assets: |
|
|
|
|
|
|
| Property and equipment,
net |
3,781,613 |
|
3,795,852 |
|
551,466 |
|
| Intangible assets,
net |
977,341 |
|
941,918 |
|
136,843 |
|
| Land use rights,
net |
167,646 |
|
166,687 |
|
24,216 |
|
| Deferred tax
assets |
100,676 |
|
96,859 |
|
14,072 |
|
| Goodwill |
1,755,970 |
|
1,755,970 |
|
255,110 |
|
| Long term
investments |
298,871 |
|
301,296 |
|
43,773 |
|
| Restricted cash |
33,544 |
|
3,551 |
|
516 |
|
| Other non-current
assets |
147,302 |
|
124,224 |
|
18,047 |
|
|
Total non-current assets |
7,262,963 |
|
7,186,357 |
|
1,044,043 |
|
| Total
assets |
12,421,524 |
|
12,287,635 |
|
1,785,163 |
|
| Liabilities and
Shareholders' Equity |
|
|
|
|
|
|
| Current
liabilities: |
|
|
|
|
|
|
| Short-term bank
borrowings |
1,683,676 |
|
1,638,676 |
|
238,069 |
|
| Accounts and notes
payable |
529,569 |
|
590,059 |
|
85,725 |
|
| Accrued expenses and
other payables |
787,916 |
|
700,306 |
|
101,741 |
|
| Deferred revenue |
320,023 |
|
281,466 |
|
40,892 |
|
| Advances from
customers |
201,397 |
|
313,296 |
|
45,516 |
|
| Income taxes
payable |
21,899 |
|
28,608 |
|
4,156 |
|
| Amounts due to related
parties |
121,928 |
|
126,953 |
|
18,444 |
|
| Current portion of
long-term bank borrowings |
39,303 |
|
42,361 |
|
6,154 |
|
| Current portion of
capital lease obligations |
243,723 |
|
259,469 |
|
37,696 |
|
| Current portion of
deferred government grant |
5,107 |
|
4,959 |
|
720 |
|
| Current portion of
bonds payable |
419,316 |
|
419,905 |
|
61,004 |
|
| Total current
liabilities |
4,373,857 |
|
4,406,058 |
|
640,117 |
|
| Non-current
liabilities: |
|
|
|
|
|
|
| Long-term bank
borrowings |
268,221 |
|
272,227 |
|
39,549 |
|
| Deferred revenue |
62,531 |
|
58,014 |
|
8,428 |
|
| Unrecognized tax
benefits |
28,689 |
|
29,781 |
|
4,327 |
|
| Deferred tax
liabilities |
274,700 |
|
271,123 |
|
39,389 |
|
| Non-current portion of
capital lease obligations |
536,623 |
|
541,828 |
|
78,717 |
|
| Non-current portion of
deferred government grant |
25,886 |
|
24,732 |
|
3,593 |
|
| Total
non-current liabilities |
1,196,650 |
|
1,197,705 |
|
174,003 |
|
| |
|
|
|
|
|
|
| Redeemable
noncontrolling interests |
700,000 |
|
700,000 |
|
101,697 |
|
| |
|
|
|
|
|
|
| Shareholders'
equity |
|
|
|
|
|
|
| Treasury stock |
(204,557 |
) |
(270,978 |
) |
(39,368 |
) |
| Ordinary shares |
45 |
|
45 |
|
7 |
|
| Additional paid-in
capital |
9,015,846 |
|
9,027,182 |
|
1,311,480 |
|
| Accumulated other
comprehensive gain |
118,290 |
|
105,374 |
|
15,309 |
|
| Statutory reserves |
64,622 |
|
66,062 |
|
9,598 |
|
| Accumulated
deficit |
(2,869,031 |
) |
(2,970,265 |
) |
(431,523 |
) |
| Total 21Vianet
Group, Inc. shareholders’ equity |
6,125,215 |
|
5,957,420 |
|
865,503 |
|
| Noncontrolling
interest |
25,802 |
|
26,452 |
|
3,843 |
|
| Total
shareholders' equity |
6,151,017 |
|
5,983,872 |
|
869,346 |
|
| Total
liabilities, redeemable noncontrolling interests and shareholders'
equity |
12,421,524 |
|
12,287,635 |
|
1,785,163 |
|
| |
|
|
|
|
|
|
| 21VIANET GROUP, INC. |
|
| CONSOLIDATED STATEMENTS OF
OPERATIONS |
|
| (Amount in thousands of Renminbi (“RMB”) and US
dollars (“US$”) except for number of shares and per share
data) |
|
| |
|
|
|
|
|
| |
Three months ended |
|
| |
March 31, 2016 |
|
December 31, 2016 |
|
March 31, 2017 |
|
|
| |
RMB |
|
RMB |
|
RMB |
|
US$ |
|
|
| |
(Unaudited) |
|
(Unaudited) |
|
(Unaudited) |
|
(Unaudited) |
|
|
| Net
revenues |
|
|
|
|
|
|
|
|
|
| Hosting and related
services |
596,484 |
|
703,174 |
|
706,711 |
|
102,672 |
|
|
| Managed network
services |
265,788 |
|
197,473 |
|
155,466 |
|
22,586 |
|
|
| Total net revenues |
862,272 |
|
900,647 |
|
862,177 |
|
125,258 |
|
|
| Cost of revenues |
(693,292 |
) |
(717,276 |
) |
(681,700 |
) |
(99,038 |
) |
|
| Gross
profit |
168,980 |
|
183,371 |
|
180,477 |
|
26,220 |
|
|
| Operating
expenses |
|
|
|
|
|
|
|
|
|
| Sales and
marketing |
(77,315 |
) |
(92,018 |
) |
(65,832 |
) |
(9,564 |
) |
|
| Research and
development |
(41,857 |
) |
(38,425 |
) |
(38,387 |
) |
(5,577 |
) |
|
| General and
administrative |
(133,806 |
) |
(186,744 |
) |
(135,803 |
) |
(19,730 |
) |
|
| Bad debt provision |
5 |
|
(47,450 |
) |
(15,465 |
) |
(2,247 |
) |
|
| Changes in the fair
value of contingent purchase consideration payable |
(1,481 |
) |
67,197 |
|
2,867 |
|
417 |
|
|
| Impairment of
long-lived assets |
- |
|
(392,947 |
) |
- |
|
- |
|
|
| Total operating
expenses |
(254,454 |
) |
(690,387 |
) |
(252,620 |
) |
(36,701 |
) |
|
| Operating
loss |
(85,474 |
) |
(507,016 |
) |
(72,143 |
) |
(10,481 |
) |
|
| Interest income |
8,882 |
|
4,839 |
|
8,252 |
|
1,199 |
|
|
| Interest expense |
(55,692 |
) |
(40,652 |
) |
(37,027 |
) |
(5,379 |
) |
|
| Other income |
1,106 |
|
555 |
|
4,826 |
|
701 |
|
|
| Other expense |
(1,104 |
) |
(1,825 |
) |
(1,562 |
) |
(227 |
) |
|
| Foreign exchange (loss)
gain |
(5,243 |
) |
28,849 |
|
(5,481 |
) |
(796 |
) |
|
| Loss before
income taxes and gain from equity method investments |
(137,525 |
) |
(515,250 |
) |
(103,135 |
) |
(14,983 |
) |
|
| Income tax (expense)
benefit |
(14,994 |
) |
17,818 |
|
(16,127 |
) |
(2,343 |
) |
|
| Gain from equity method
investments |
1,201 |
|
12,225 |
|
2,425 |
|
352 |
|
|
| Net
loss |
(151,318 |
) |
(485,207 |
) |
(116,837 |
) |
(16,974 |
) |
|
| Net loss
attributable to noncontrolling interest |
8,518 |
|
225,353 |
|
17,043 |
|
2,476 |
|
|
| Net loss
attributable to ordinary shareholders |
(142,800 |
) |
(259,854 |
) |
(99,794 |
) |
(14,498 |
) |
|
| |
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
| Loss per share |
|
|
|
|
|
|
|
|
|
| Basic |
(0.28 |
) |
(0.69 |
) |
(0.17 |
) |
(0.02 |
) |
|
| Diluted |
(0.28 |
) |
(0.69 |
) |
(0.17 |
) |
(0.02 |
) |
|
| Shares used in loss per
share computation |
|
|
|
|
|
|
|
|
|
| Basic* |
525,041,586 |
|
681,210,352 |
|
678,649,016 |
|
678,649,016 |
|
|
| Diluted* |
525,041,586 |
|
681,210,352 |
|
678,649,016 |
|
678,649,016 |
|
|
| |
|
|
|
|
|
|
|
|
|
| Loss per ADS (6
ordinary shares equal to 1 ADS) |
|
|
|
|
|
|
|
|
|
| Basic |
(1.68 |
) |
(4.14 |
) |
(1.02 |
) |
(0.15 |
) |
|
| Diluted |
(1.68 |
) |
(4.14 |
) |
(1.02 |
) |
(0.15 |
) |
|
| |
|
|
|
|
|
| * Shares
used in loss per share/ADS computation were computed under weighted
average method. |
|
| 21VIANET GROUP, INC. |
|
| RECONCILIATIONS OF GAAP AND NON-GAAP
RESULTS |
|
| (Amount in thousands of Renminbi (“RMB”) and US
dollars (“US$”) except for number of shares and per share
data) |
|
| |
|
|
|
|
|
| |
Three months ended |
|
| |
March 31, 2016 |
|
December 31, 2016 |
|
March 31, 2017 |
|
|
| |
RMB |
|
RMB |
|
RMB |
|
US$ |
|
|
| Gross profit |
168,980 |
|
183,371 |
|
180,477 |
|
26,220 |
|
|
| Plus: share-based
compensation expense |
3,925 |
|
1,865 |
|
(222 |
) |
(32 |
) |
|
| Plus: amortization of
intangible assets derived from acquisitions |
38,197 |
|
37,369 |
|
31,372 |
|
4,558 |
|
|
| |
|
|
|
|
|
|
|
|
|
| Adjusted gross
profit |
211,102 |
|
222,605 |
|
211,627 |
|
30,746 |
|
|
| Adjusted gross
margin |
24.5 |
% |
24.7 |
% |
24.5 |
% |
24.5 |
% |
|
| Operating expenses |
(254,454 |
) |
(690,387 |
) |
(252,620 |
) |
(36,701 |
) |
|
| Plus: share-based
compensation expense |
33,468 |
|
54,808 |
|
4,545 |
|
660 |
|
|
| Plus: changes in the
fair value of contingent purchase consideration payable |
1,481 |
|
(67,197 |
) |
(2,867 |
) |
(417 |
) |
|
| Plus: impairment of
long-lived assets |
- |
|
392,947 |
|
- |
|
- |
|
|
| Adjusted
operating expenses |
(219,505 |
) |
(309,829 |
) |
(250,942 |
) |
(36,458 |
) |
|
| Net loss |
(151,318 |
) |
(485,207 |
) |
(116,837 |
) |
(16,974 |
) |
|
| Plus: share-based
compensation expense |
37,393 |
|
56,673 |
|
4,323 |
|
628 |
|
|
| Plus: amortization of
intangible assets derived from acquisitions |
38,197 |
|
37,369 |
|
31,372 |
|
4,558 |
|
|
| Plus: changes in the
fair value of contingent purchase consideration payable and related
deferred tax impact |
1,976 |
|
(67,874 |
) |
(2,867 |
) |
(417 |
) |
|
| Plus: impairment of
long-lived assets |
- |
|
392,947 |
|
- |
|
- |
|
|
| Adjusted net
loss |
(73,752 |
) |
(66,092 |
) |
(84,009 |
) |
(12,205 |
) |
|
| Adjusted net
margin |
-8.6 |
% |
-7.3 |
% |
-9.7 |
% |
-9.7 |
% |
|
| Net loss |
(151,318 |
) |
(485,207 |
) |
(116,837 |
) |
(16,974 |
) |
|
| Minus: Provision for
income taxes |
(14,994 |
) |
17,818 |
|
(16,127 |
) |
(2,343 |
) |
|
| Minus: Interest
income |
8,882 |
|
4,839 |
|
8,252 |
|
1,199 |
|
|
| Minus: Interest
expenses |
(55,692 |
) |
(40,652 |
) |
(37,027 |
) |
(5,379 |
) |
|
| Minus: Exchange (loss)
gain |
(5,243 |
) |
28,849 |
|
(5,481 |
) |
(796 |
) |
|
| Minus: Gain from equity
method investment |
1,201 |
|
12,225 |
|
2,425 |
|
352 |
|
|
| Minus: Other
income |
1,106 |
|
555 |
|
4,826 |
|
701 |
|
|
| Minus: Other
expenses |
(1,104 |
) |
(1,825 |
) |
(1,562 |
) |
(227 |
) |
|
| Plus: depreciation |
108,940 |
|
130,486 |
|
129,609 |
|
18,830 |
|
|
| Plus: amortization |
46,222 |
|
46,092 |
|
41,344 |
|
6,007 |
|
|
| Plus: share-based
compensation expense |
37,393 |
|
56,673 |
|
4,323 |
|
628 |
|
|
| Plus: changes in the
fair value of contingent purchase consideration payable |
1,481 |
|
(67,197 |
) |
(2,867 |
) |
(417 |
) |
|
| Plus: impairment of
long-lived assets |
- |
|
392,947 |
|
- |
|
- |
|
|
| Adjusted
EBITDA |
108,562 |
|
51,985 |
|
100,266 |
|
14,567 |
|
|
| Adjusted EBITDA
margin |
12.6 |
% |
5.8 |
% |
11.6 |
% |
11.6 |
% |
|
| |
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
| Adjusted net loss |
(73,752 |
) |
(66,092 |
) |
(84,009 |
) |
(12,205 |
) |
|
| Less: Net loss
attributable to noncontrolling interest |
8,518 |
|
225,353 |
|
17,043 |
|
2,476 |
|
|
| Adjusted net (loss)
profit attributable to the Company’s ordinary shareholders |
(65,234 |
) |
159,261 |
|
(66,966 |
) |
(9,729 |
) |
|
| |
|
|
|
|
|
|
|
|
|
| Adjusted loss per
share |
|
|
|
|
|
|
|
|
|
| Basic |
(0.14 |
) |
(0.08 |
) |
(0.12 |
) |
(0.02 |
) |
|
| Diluted |
(0.14 |
) |
(0.08 |
) |
(0.12 |
) |
(0.02 |
) |
|
| Shares used in adjusted
loss per share computation: |
|
|
|
|
|
|
|
|
|
| Basic* |
525,041,586 |
|
681,210,352 |
|
678,649,016 |
|
678,649,016 |
|
|
| Diluted* |
525,041,586 |
|
700,264,943 |
|
678,649,016 |
|
678,649,016 |
|
|
| |
|
|
|
|
|
|
|
|
|
| Adjusted loss per ADS
(6 ordinary shares equal to 1 ADS) |
|
|
|
|
|
|
|
|
|
| Basic |
(0.84 |
) |
(0.48 |
) |
(0.72 |
) |
(0.10 |
) |
|
| Diluted |
(0.84 |
) |
(0.48 |
) |
(0.72 |
) |
(0.10 |
) |
|
| |
|
|
|
|
|
| * Shares
used in adjusted loss/ADS per share computation were computed under
weighted average method. |
|
| 21VIANET GROUP, INC. |
| CONSOLIDATED STATEMENT OF CASH
FLOWS |
| (Amount in thousands of Renminbi (“RMB”) and US
dollars (“US$”)) |
| |
|
|
|
| |
|
| |
December 31, 2016 |
March 31, 2017 |
| |
RMB |
RMB |
US$ |
| |
(Unaudited) |
|
|
| CASH FLOWS FROM
OPERATING ACTIVITIES |
|
|
|
| Net loss |
(485,207 |
) |
(116,837 |
) |
(16,974 |
) |
| Adjustments to
reconcile net loss to net cash generated from operating
activities: |
|
|
|
|
|
|
| Foreign exchange (loss)
gain |
(28,849 |
) |
5,481 |
|
796 |
|
| Changes in the fair
value of contingent purchase consideration payable |
(67,197 |
) |
(2,867 |
) |
(417 |
) |
| Depreciation of
property and equipment |
130,486 |
|
129,609 |
|
18,830 |
|
| Amortization of
intangible assets |
44,860 |
|
41,344 |
|
6,007 |
|
| Gain on disposal of
property and equipment |
12,101 |
|
- |
|
- |
|
| Provision for doubtful
accounts and other receivables |
48,706 |
|
15,465 |
|
2,247 |
|
| Share-based
compensation expense |
56,672 |
|
4,323 |
|
628 |
|
| Deferred income taxes
(benefit) expense |
(31,605 |
) |
240 |
|
35 |
|
| Gain from equity method
investment |
(12,225 |
) |
(2,425 |
) |
(352 |
) |
| Impairment of
long-lived assets |
392,947 |
|
- |
|
- |
|
| Changes in
operating assets and liabilities |
|
|
|
|
|
|
| Restricted cash |
11,846 |
|
(24,102 |
) |
(3,502 |
) |
| Inventories |
1,617 |
|
(154 |
) |
(22 |
) |
| Accounts and notes
receivable |
51,084 |
|
(80,864 |
) |
(11,748 |
) |
| Unrecognized tax
benefits |
5,984 |
|
1,092 |
|
159 |
|
| Prepaid expenses and
other current assets |
(10,221 |
) |
(85,428 |
) |
(12,411 |
) |
| Amounts due from
related parties |
(6,359 |
) |
(1,082 |
) |
(157 |
) |
| Accounts and notes
payable |
(20,145 |
) |
60,490 |
|
8,788 |
|
| Accrued expenses and
other payables |
25,348 |
|
(4,161 |
) |
(606 |
) |
| Deferred revenue |
(9,192 |
) |
(43,074 |
) |
(6,258 |
) |
| Advances from
customers |
12,473 |
|
111,899 |
|
16,257 |
|
| Income taxes
payable |
(14,864 |
) |
6,709 |
|
975 |
|
| Amounts due to related
parties |
4,031 |
|
7,892 |
|
1,147 |
|
| Deferred government
grants |
(1,344 |
) |
(1,302 |
) |
(189 |
) |
| Net cash
generated from operating activities |
110,947 |
|
22,248 |
|
3,233 |
|
| CASH FLOWS FROM
INVESTING ACTIVITIES |
|
|
|
|
|
|
| Purchases of property
and equipment |
(136,544 |
) |
(99,432 |
) |
(14,446 |
) |
| Purchases of intangible
assets |
(11,859 |
) |
(9,386 |
) |
(1,364 |
) |
| Payment for asset
acquisition |
(6,859 |
) |
(15,053 |
) |
(2,187 |
) |
| Proceeds from disposal
of property and equipment |
51 |
|
- |
|
- |
|
| Receipt of loans from
third parties |
40,000 |
|
- |
|
- |
|
| Payments for short-term
investments |
(272,914 |
) |
(207,003 |
) |
(30,074 |
) |
| Proceeds received from
maturity of short-term investments |
10,000 |
|
- |
|
- |
|
| Payments for long-term
investments |
(5,025 |
) |
- |
|
- |
|
| Net cash used
in investing activities |
(383,150 |
) |
(330,874 |
) |
(48,071 |
) |
| CASH FLOWS FROM
FINANCING ACTIVITIES |
|
|
|
|
|
|
| Restricted cash |
(76,284 |
) |
(48,515 |
) |
(7,048 |
) |
| Proceeds from exercise
of stock options |
662 |
|
555 |
|
81 |
|
| Proceeds from long-term
bank borrowings |
54,620 |
|
9,038 |
|
1,313 |
|
| Proceeds from
short-term bank borrowings |
37,000 |
|
50,000 |
|
7,264 |
|
| Repayments of
short-term bank borrowings |
(123,000 |
) |
(95,000 |
) |
(13,802 |
) |
| Repayments of long-term
bank borrowings |
(27,003 |
) |
(1,974 |
) |
(287 |
) |
| Consideration paid to
selling shareholders |
(142 |
) |
- |
|
- |
|
| Prepayment for shares
repurchase plan |
|
|
- |
|
- |
|
| Payments for shares
repurchase plan |
(1,603 |
) |
(41,192 |
) |
(5,984 |
) |
| Rental prepayments and
deposits for sales and leaseback transactions |
(28,897 |
) |
(33,886 |
) |
(4,923 |
) |
| Payments for capital
leases |
(32,719 |
) |
(32,055 |
) |
(4,657 |
) |
| Contribution from
noncontrolling interest in a subsidiary |
4,000 |
|
- |
|
- |
|
| Net cash used
in financing activities |
(193,366 |
) |
(193,029 |
) |
(28,043 |
) |
| Effect of
foreign exchange rate changes on cash and short term
investments |
100,505 |
|
(16,250 |
) |
(2,361 |
) |
| Net decrease in
cash and cash equivalents |
(365,064 |
) |
(517,905 |
) |
(75,242 |
) |
| Cash and cash
equivalents at beginning of period |
1,662,482 |
|
1,297,418 |
|
188,491 |
|
| Cash and cash
equivalents at end of period |
1,297,418 |
|
779,513 |
|
113,249 |
|
| |
|
|
|
|
|
|
Investor Relations Contacts:
21Vianet Group, Inc.
Calvin Jiang
+86 10 8456 2121
IR@21Vianet.com
ICR, Inc.
Xueli Song
+1 (646) 405-4922
IR@21Vianet.com
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