SHANGHAI, July 1, 2019 /PRNewswire/ -- JMU Limited (the
"Company" or "JMU") (Nasdaq:
JMU), a B2B online e-commerce platform
that provides integrated services to suppliers and customers in the
foodservice industry in China,
today announced its audited financial results for the fiscal year
ended December 31, 2018.
Fiscal Year 2018 Highlights
- Revenues in 2018 were $36.5
million, representing a decrease of 58.9% from $88.7 million in 2017. The decrease was mainly
due to the Company re-examining its B2B platform business and
re-developing and transforming its future positioning and strategy
in 2018. During the year, the Company suspended businesses that
were strategically misaligned, products with lower gross profit,
and a portion of business and services that involved third-party
sellers and buyers.
- Gross profit was $876 thousand in
2018, an increase of $327 thousand
from 2017.
- B2B online platform recorded gross billing of RMB7.7 billion (US$1.1
billion) in 2018, measured in terms of gross merchandise
value ("GMV"), decreasing 51.9% from gross billing of RMB16.0 billion (US$ 2.5
billion) in 2017. The decrease was mainly due to the Company
re-examining its B2B platform business and re-developing and
transforming its future positioning and strategy in 2018.
- Active customer accounts were 10,304 as of December 31, 2018, decreasing 68.8% from 33,025
as of December 31, 2017.
- Third-party sellers on the Company's online marketplace
decreased to 3,779 as of December 31,
2018, compared to over 15,800 as of December 31, 2017.
Ms. Xiaoxia Zhu, Chairperson and
Chief Executive Officer commented, "Through re-examining and
adjusting our strategy and business, we hope to bring better growth
opportunities for JMU and create better
market service value for our customers."
Fiscal Year 2018 Financial Performance
Revenues were $36.5 million
for 2018, representing a decrease of 58.9% from $88.7 million in 2017. The decrease of revenue in
2018 was mainly due the Company re-examining its B2B platform
business and re-developing and transforming its future positioning
and strategy in 2018. During the year, the Company suspended
businesses that were strategically misaligned, products with lower
gross profit, and a portion of business and services that involved
third-party sellers and buyers.
Cost of revenues were $35.6
million in the year of 2018, representing a decrease of
59.6% from $88.2 million in 2017.
Gross profit for 2018 was $876
thousand, representing a 59.6% increase from $549 thousand in 2017. Gross margin increased to
2.4% in 2018 from 0.62% in 2017.
Selling and marketing expenses in 2018 decreased
61.8% to $5.8 million from
$15.2 million in 2017. As a
percentage of total revenue, selling and marketing expense was
15.9% and 17.1% in fiscal years 2018 and 2017, respectively.
The decrease was primarily attributable to the impairment of
acquired intangible assets decreasing to zero, which resulted in
the amortization of intangible assets decreasing by $7.2 million. Marketing, advertising, and travel
expenses also decreased.
General and administrative expenses in 2018 were
$4.3 million, representing a decrease
of 35.8% from $6.7 million in 2017.
As a percentage of total revenues, general and administrative
expenses were 9.6% and 7.6% in 2018 and 2017, respectively.
Impairment loss in 2018 was $115.2
million, representing a decrease of 21.7% from $147.0 million in 2017. As a percentage of total
revenue, impairment loss were 315.9% and 165.7% in 2018 and 2017,
respectively.
Loss from operations in 2018 was $124.4 million, representing a decrease of 26.1%
from $168.4 million in 2017.
Net loss attributable to the Company in 2018 was
$123.2 million, representing a
decrease of 23.9% from $161.9 million
in 2017. Non-GAAP net loss attributable to the Company, which
excludes amortization of acquired intangible assets, impairment
loss, share-based compensation and related provision for income tax
benefits, was $9 million in 2018
compared to $12.3 million in 2017.
For the years ended December 31, 2018
and 2017, the Company's weighted average number of ordinary shares
used in computing loss per ordinary share was 1,476,801,177 and
1,476,144,194, respectively.
As of December 31, 2018, the
Company's cash and cash equivalents was $0.4
million, representing a decrease of 92.7% from $4.9 million as of December 31, 2017. Total shareholders' deficit as
of December 31, 2018 was $20.2 million compared to total shareholders'
equity of $103.6 million as of
December 31, 2017.
Form 20-F Filings for Fiscal Year 2018
JMU filed its annual report on Form
20-F for the year ended December 31,
2018 with the Securities and Exchange Commission. The annual
report can be accessed and downloaded through the investor
relations section of the Company's website and all shareholders can
receive a hard copy of the Company's complete audited financial
statements free of charge upon request.
Recent Development
On May 21, 2019, JMU entered into a share purchase agreement with
Unicorn Investment Limited ("Unicorn") and Mr. Haohan Xu, one of JMU's shareholders, pursuant to which JMU acquired all the issued and outstanding shares
of Unicorn held by Mr. Haohan Xu, in
consideration for the issuance of 632,660,858 new ordinary shares.
Immediately after the closing of the foregoing transaction, Mr.
Haohan Xu held approximately 48.0%
of all the issued and outstanding shares of the Company. Please
refer to the press release issued by JMU on May 21, 2019
for further details.
Non-GAAP Measures
To supplement our consolidated financial statements presented in
accordance with U.S. generally accepted accounting principles
("U.S. GAAP"), we use various non-GAAP financial measures that are
adjusted from results based on U.S. GAAP to exclude amortization of
acquired intangible assets, impairment of goodwill, share-based
compensation and related provision for income tax benefits.
Our non-GAAP financial information is 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 historical and current
financial performance of our operations and our prospects for the
future. Our non-GAAP financial information 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
financial results. In addition, our calculation of this non-GAAP
financial information may be different from the calculation used by
other companies, and therefore comparability may be limited.
A limitation of using these non-GAAP financial measures is that
amortization of acquired intangible assets, impairment of goodwill,
share-based compensation and related provision for income tax
benefits have been and may continue to be for the foreseeable
future significant recurring expenses in our results of operations.
We compensate for these limitations by providing reconciliations of
our non-GAAP financial measures to our U.S. GAAP financial
measures. Please see the reconciliation tables at the end of this
earnings release.
About JMU Limited
JMU Limited operates a B2B online e-commerce platform in
China that provides integrated
services to suppliers and customers in the catering industry. With
the help of Internet and cloud technologies, JMU has the vision to reshape the procurement and
distribution pattern and build a fair business ecosystem in
China's catering industry.
JMU keeps concentrating on its
ready-to-cook and ready-to-eat products in China.
Through cooperation with national and local industry
associations and reputable restaurant groups across China, JMU has
formed an industrial alliance and has great resource leverage in
China's catering industry.
JMU works closely with suppliers and
customers in the catering industry, providing one-stop procurement
services, as well as other value-added services. For more
information, please visit: http://ir.ccjmu.com.
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
"aim," "anticipate," "believe," "estimate," "expect," "hope,"
"going forward," "intend," "ought to," "plan," "project,"
"potential," "seek," "may," "might," "can," "could," "will,"
"would," "shall," "should," "is likely to" and the negative form of
these words and other similar expressions. Among other things,
statements that are not historical facts, including statements
about JMU's beliefs and expectations,
the business outlook and quotations from management in this
announcement, as well as JMU's
strategic and operational plans, are or contain 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: The general
economic and business conditions in China may deteriorate. The growth of Internet
and mobile user population in China might not be as strong as expected.
JMU's plan to enhance customer
experience, upgrade infrastructure and increase service offerings
might not be well received. JMU might
not be able to implement all of its strategic plans as expected.
Competition in China may intensify
further. All information provided in this press release is as of
the date of this press release and are based on assumptions that we
believe to be reasonable as of this date, and JMU does not undertake any obligation to update any
forward-looking statement, except as required under applicable
law.
Contact:
Zhengzhen Li
JMU Limited
lizhengzhen@ccjmu.com
Tel: +86 (021) 6015-1166, ext. 8904
Kristy Meng
ICR Inc.
kristy.meng@icrinc.com
Tel: +86 (010) 6583-7504
JMU LIMITED
FORMERLY KNOWN AS WOWO LIMITED
CONSOLIDATED STATEMENTS OF OPERATIONS
(US dollars in thousands, except for number of shares and per share
(or ADS) data)
|
|
For the years
ended December 31
|
2017
|
|
2018
|
|
|
|
|
Related
parties
|
17,485
|
|
10,873
|
Third
parties
|
71,251
|
|
25,582
|
Total
Revenues
|
88,736
|
|
36,455
|
Cost of
revenues
|
(88,187)
|
|
(35,579)
|
Gross
profit
|
549
|
|
876
|
|
|
|
|
Operating
expenses:
|
|
|
|
Selling and marketing
(including share-based compensation of
$680,124, $538,897 for the years ended December 31, 2016
and 2017 , respectively and reversal of $241,150 for the year
ended December 31, 2018)
|
(15,207)
|
|
(5,792)
|
General and
administrative (including share-based
compensation of $417,419, $528,889 and $184,445 for the
years ended December 31, 2016, 2017 and 2018,
respectively)
|
(6,697)
|
|
(4,303)
|
Impairment
loss
|
(147,018)
|
|
(115,179)
|
Total operating
expenses
|
(168,922)
|
|
(125,274)
|
Loss from
operations
|
(168,373)
|
|
(124,398)
|
Interest
income/(expense), net
|
(411)
|
|
(907)
|
Other
income/(expense), net
|
28
|
|
(33)
|
Loss before
provision for income taxes
|
(168,756)
|
|
(125,338)
|
Income tax
benefits
|
6,857
|
|
2,098
|
Net
loss
|
(161,899)
|
|
(123,240)
|
|
|
|
|
Net loss per
ordinary share
|
|
|
|
Basic
|
(0.11)
|
|
(0.08)
|
Diluted
|
(0.11)
|
|
(0.08)
|
Weighted average
shares used in calculating net loss per
ordinary share
|
|
|
|
Basic
|
1,476,144,194
|
|
1,476,801,177
|
Diluted
|
1,476,144,194
|
|
1,476,801,177
|
JMU LIMITED
FORMERLY KNOWN AS WOWO LIMITED
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(US dollars in thousands)
|
|
For the years
ended December 31
|
2017
|
|
2018
|
|
|
|
|
|
|
|
|
Net
loss
|
(161,899)
|
|
(123,240)
|
Other comprehensive
income/(loss)
|
|
|
|
Change in cumulative foreign
currency translation adjustment
|
15,975
|
|
(2,442)
|
Comprehensive
loss
|
(145,924)
|
|
(125,682)
|
JMU LIMITED
FORMERLY KNOWN AS WOWO LIMITED
CONSOLIDATED BALANCE SHEETS
(US dollars in thousands)
|
|
|
|
|
December 31,
2017
|
|
December 31,
2018
|
ASSETS:
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
|
4,912
|
|
357
|
Accounts receivable,
net of allowance of $nil as of December 31, 2017
and 2018
|
|
3,296
|
|
176
|
Inventories
|
|
539
|
|
586
|
Prepaid expenses and
other current assets, net
|
|
2,246
|
|
1,121
|
Amounts due from
related parties
|
|
3,063
|
|
2,378
|
Total current
assets
|
|
14,056
|
|
4,618
|
Non-current
assets:
|
|
|
|
|
Property and
equipment, net
|
|
1,795
|
|
406
|
Acquired intangible
assets, net
|
|
10,264
|
|
-
|
Investment
|
|
768
|
|
-
|
Goodwill
|
|
108,940
|
|
-
|
Deferred tax
assets
|
|
157
|
|
-
|
Other non-current
assets
|
|
162
|
|
-
|
Total non-current
assets
|
|
122,086
|
|
406
|
TOTAL
ASSETS
|
|
136,142
|
|
5,024
|
LIABILITIES AND
SHAREHOLDER'S EQUITY :
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Short-term bank
borrowings (including short-term bank borrowings
of VIE without recourse to the Company of $7,684,859 and
$7,272,198
as of December 31, 2017 and 2018, respectively)
|
|
7,685
|
|
7,272
|
Accounts and notes
payable (including accounts and notes payable of
VIE without recourse to the Company of $3,980,560 and $540,899
as
of December 31, 2017 and 2018, respectively)
|
|
3,981
|
|
543
|
Accrued expenses and
other current liabilities (including accrued
expenses and other current liabilities of VIE without recourse to
the
Company of $8,345,461 and $5,336,699 as of December 31,
2017
and 2018, respectively)
|
|
9,292
|
|
6,917
|
Advance from
customers (including advance from customers of VIE
without recourse to the Company of $1,243,739 and $422,702 as
of
December 31, 2017 and 2018, respectively)
|
|
1,244
|
|
423
|
Amounts due to
related parties (including amounts due to related
parties of VIE without recourse to the Company of $87,385 and
$3,311,752 as of December 31, 2017 and 2018,
respectively)
|
|
604
|
|
5,135
|
Total current
liabilities
|
|
22,806
|
|
20,290
|
Non-current
liabilities:
|
|
|
|
|
Other non-current
liabilities (including other non-current liabilities of
VIE without recourse to the Company of $1,386,749 and $nil as
of
December 31, 2017 and 2018, respectively)
|
|
1,534
|
|
30
|
Deferred tax
liabilities (including deferred tax liabilities of the VIE
without recourse to the Company of $nil and $nil as of December
31,
2017 and 2018, respectively)
|
|
2,565
|
|
-
|
Amount due to related
parties (including amount due to related
parties of the VIE without recourse to the Company of $5,685,971
and
$6,892,316 as of December 31, 2017 and 2018,
respectively)
|
|
5,686
|
|
6,892
|
Total non-current
liabilities
|
|
9,785
|
|
6,922
|
TOTAL
LIABILITIES
|
|
32,591
|
|
27,212
|
Commitments and
contingencies
|
|
|
|
|
Shareholders'equity:
|
|
|
|
|
Ordinary shares
($0.00001 par value; 1,476,208,670 shares authorized,
1,476,208,670 shares issued and outstanding as of December 31,
2017 and 2018)
|
|
15
|
|
15
|
Additional paid-in
capital
|
|
634,071
|
|
634,016
|
Accumulated
deficit
|
|
(513,903)
|
|
(637,143)
|
Accumulated other
comprehensive loss
|
|
(16,632)
|
|
(19,076)
|
Total
shareholders' equity/(deficit)
|
|
103,551
|
|
(22,188)
|
TOTAL LIABILITIES
AND SHAREHOLDERS'EQUITY
|
|
136,142
|
|
5,024
|
JMU LIMITED
Reconciliation of Non-GAAP financial measures
to comparable GAAP measures
(US dollars in thousands)
|
|
|
|
|
|
|
|
For the years
ended December 31
|
|
|
2017
|
|
2018
|
Loss from
operations
|
|
168,373
|
|
124,398
|
Net loss attributable
to JMU Ltd.
|
|
161,899
|
|
123,240
|
|
|
|
|
|
Amortization of
acquired intangible assets
|
a
|
8,359
|
|
1,171
|
Provision for income
tax benefits
|
b
|
(6,857)
|
|
(2,098)
|
Share-based
compensation
|
c
|
1,068
|
|
(57)
|
Impairment
loss
|
d
|
147,018
|
|
115,179
|
|
|
|
|
|
Non-GAAP loss from
operation (a)(c)(d)
|
|
11,928
|
|
8,105
|
Non-GAAP net loss
attributable to JMU Ltd.(a)(b)(c)(d)
|
|
12,311
|
|
9,045
|
|
|
|
|
|
Note:
|
|
|
|
|
(a)Adjustment to
exclude amortization of acquired intangible assets
|
|
|
(b)Adjustment to
exclude income tax benefits
|
|
|
|
|
(c)Adjustment to
exclude share-based compensation
|
|
|
|
|
(d)Adjustment to
exclude impairment loss
|
|
|
|
|
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SOURCE JMU Ltd