SHANGHAI, Aug. 1, 2019 /PRNewswire/ -- JMU Limited (the
"Company" or "JMU") (Nasdaq:
JMU) today announced its unaudited
financial results for the six months ended June 30, 2019, or the first half of the Company's
fiscal year 2019.
First Half of Fiscal Year 2019 Highlights
- Revenues were $762 thousand,
representing a decrease of 96.1% from $19.5
million in the prior year period. The decrease was mainly
due to the Company's decision to switch from its loss-making B2B
platform business to other business opportunities that may have
greater growth potential.
- Gross profit was $39 thousand, a
decrease of 91.7% from $471 thousand
in the prior year period.
- B2B online platform recorded gross billing of RMB 87.5 million (US$ 12.7
million), measured in terms of gross merchandise value
("GMV"), decreasing 98.1% from gross billing of RMB 4.6 billion (US$ 721.2
million) in the prior year period.
- Active customer accounts were 732 as of June 30, 2019, decreasing 92% from 10,304 as of
December 31, 2018.
- Third-party sellers on the Company's online marketplace
decreased to 196 as of June 30, 2019,
compared to 3,779 as of December 31,
2018.
Ms. Hua Zhou, Chairperson of the Board of Directors and Chief
Executive Officer commented, "Due to the increasing competition in
the market, we have gradually exited from our costly and
loss-making B2B business while actively seeking a new direction for
the development of our business. Our efforts have been proven to be
effective as we significantly reduced our cost and net loss for the
first half of 2019 despite the decreased revenue. Going forward, we
will continue looking for new business partners and opportunities
to further narrow our losses."
First Half of Fiscal Year 2019 Financial
Performance
Revenues were $762 thousand
in the first half of 2019, representing a decrease of 96.1% from
$19.5 million in the prior year
period. The decrease of revenue was mainly due the Company's
decision to switch from its loss-making B2B platform business to
other business opportunities that may have greater growth
potential.
Cost of revenues were $723
thousand in the first half of 2019, representing a decrease
of 96.2% from $19.0 million in the
prior year period.
Gross profit for the first half of 2019 was $39 thousand, representing a 91.7% decrease from
$471 thousand in the same period last
year. Gross margin increased to 5.1% in the first half of 2019 from
2.4% in the same period of last year.
Selling and marketing expenses for the first half of
2019 decreased 90.2% to $387
thousand from $4.0 million in
the prior year period. As a percentage of total revenues, selling
and marketing expenses were 50.8% in the first half of 2019 and
20.3% in same period of last year. The decrease of selling and
marketing expenses was primarily due to decreases in marketing
expenses, travelling expenses, employee compensation, and
amortization of intangible assets.
General and administrative expenses for the first half of
2019 were $713 thousand, representing
a decrease of 63.1% from $1.9 million
in the prior year period. As a percentage of total revenues,
general and administrative expenses were 93.6% for the first half
of 2019 and 9.9% in the same period of last year. The decrease of
general and administrative expenses was primarily due to the
decrease in compensation expenses as a result of reduced headcount
and the decrease in third-party expenses related to JMU's IPO.
Loss from operations in the first half of 2019 was
$1.1 million, representing a decrease
of 98.7% from $79.2 million in the
same period of last year.
Net loss attributable to the Company in the first half of
2019 was $1.5 million, representing a
decrease of 98.1% from $79.4 million
in the prior year period. 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 $1.7
million in the first half of 2019 compared to $5.1 million in the same period of last year. For
the six months ended June 30, 2019
and 2018, the Company's weighted average number of ordinary shares
used in computing loss per ordinary share was 2,108,869,528 and
1,476,895,920, respectively.
As of June 30, 2019, the Company's
cash and cash equivalents were $529
thousand, representing an increase of 48.2% from
$357 thousand as of December 31, 2018. Total shareholders' deficit as
of June 30, 2019 was $17.2 million, compared to total shareholders'
deficit of $22.2 million as of
December 31, 2018.
Recent Development
On July 22, 2019, JMU Ltd.
announced that it has divested its food supply chain business by
selling all the issued and outstanding shares of New Admiral
Limited, a wholly-owned subsidiary of the Company, to Marvel
Billion Development Limited, in exchange for $1,000,000 in cash. In addition, the buyer and
the divested entities agreed to waive all the rights and claims
with respect to the liabilities owed by the Company to the divested
entities. Upon the completion of this transaction, the buyer has
assumed all the outstanding liabilities of the divested entities.
Please refer to the press release issued by JMU on July 22, 2019
for further details.
Non-GAAP Measures
To supplement the Company's consolidated financial statements
presented in accordance with U.S. generally accepted accounting
principles ("U.S. GAAP"), the Company uses 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.
The 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 the Company's operations and prospects for
the future. The 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, the Company's 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 the Company's results of
operations. The Company compensates for these limitations by
providing reconciliations of non-GAAP financial measures to U.S.
GAAP financial measures. Please see the reconciliation tables at
the end of this earnings release.
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
For more information about JMU Limited, please visit:
http://ir.ccjmu.com.
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 periods
ended June 30
|
2018
|
|
2019
|
|
|
|
|
Related
parties
|
6,294
|
|
36
|
Third
parties
|
13,175
|
|
726
|
Total
Revenues
|
19,469
|
|
762
|
Cost of
revenues
|
(18,998)
|
|
(723)
|
Gross
profit
|
471
|
|
39
|
|
|
|
|
Operating
expenses:
|
|
|
|
Selling and
marketing
|
(3,950)
|
|
(387)
|
General and
administrative
|
(1,933)
|
|
(713)
|
Impairment
loss
|
(73,817)
|
|
-
|
Total operating
expenses
|
(79,700)
|
|
(1,100)
|
Loss from
operations
|
(79,229)
|
|
(1,061)
|
Interest
income/(expense), net
|
(533)
|
|
(413)
|
Other
income/(expense), net
|
(37)
|
|
109
|
Loss before
provision for income taxes
|
(79,799)
|
|
(1,365)
|
Income tax
benefits
|
438
|
|
(140)
|
Net
loss
|
(79,361)
|
|
(1,505)
|
|
|
|
|
Net loss per
ordinary share
|
|
|
|
Basic
|
(0.05)
|
|
(0.00)
|
Diluted
|
(0.05)
|
|
(0.00)
|
Weighted average
shares used in calculating net loss per ordinary
share
|
|
|
|
Basic
|
1,476,895,920
|
|
2,108,869,528
|
Diluted
|
1,476,895,920
|
|
2,108,869,528
|
JMU LIMITED
FORMERLY KNOWN AS WOWO LIMITED
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(US dollars in thousands)
|
|
|
For the periods
ended December 31
|
2018
|
|
2019
|
|
|
|
|
|
|
|
|
Net
loss
|
(79,361)
|
|
(1,505)
|
Other comprehensive
income/(loss)
|
|
|
|
Change in cumulative foreign currency translation
adjustment
|
(1,572)
|
|
(40)
|
Comprehensive
loss
|
(80,933)
|
|
(1,545)
|
JMU LIMITED
FORMERLY KNOWN AS WOWO LIMITED
CONSOLIDATED BALANCE SHEETS
(US dollars in thousands)
|
|
|
|
|
|
December 31,
2018
|
|
June 30,
2019
|
ASSETS:
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
|
357
|
|
529
|
Accounts receivable,
net
|
|
176
|
|
60
|
Inventories
|
|
586
|
|
-
|
Prepaid expenses and
other current assets, net
|
|
1,121
|
|
856
|
Amounts due from
related parties
|
|
2,378
|
|
842
|
Total current
assets
|
|
4,618
|
|
2,287
|
Non-current
assets:
|
|
|
|
|
Property and
equipment, net
|
|
406
|
|
353
|
Intangible
assets
|
|
-
|
|
1,200
|
Investment
|
|
-
|
|
-
|
Goodwill
|
|
-
|
|
5,645
|
Deferred tax
assets
|
|
-
|
|
-
|
Other non-current
assets
|
|
-
|
|
-
|
Total non-current
assets
|
|
406
|
|
7,198
|
TOTAL
ASSETS
|
|
5,024
|
|
9,485
|
LIABILITIES AND
SHAREHOLDERS'
EQUITY:
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Short-term bank
borrowings
|
|
7,272
|
|
7,283
|
Accounts and notes
payable
|
|
543
|
|
225
|
Accrued expenses and
other current liabilities
|
|
6,917
|
|
5,790
|
Advance from
customers
|
|
423
|
|
160
|
Amounts due to
related parties
|
|
5,135
|
|
6,083
|
Total current
liabilities
|
|
20,290
|
|
19,541
|
Non-current
liabilities:
|
|
|
|
|
Other non-current
liabilities
|
|
30
|
|
-
|
Deferred tax
liabilities
|
|
-
|
|
-
|
Amount due to related
parties
|
|
6,892
|
|
7,099
|
Total non-current
liabilities
|
|
6,922
|
|
7,099
|
TOTAL
LIABILITIES
|
|
27,212
|
|
26,640
|
Commitments and
contingencies
|
|
|
|
|
Shareholders'equity:
|
|
|
|
|
Ordinary
shares
|
|
15
|
|
21
|
Additional paid-in
capital
|
|
634,016
|
|
640,586
|
Accumulated
deficit
|
|
(637,143)
|
|
(638,648)
|
Accumulated other
comprehensive loss
|
|
(19,076)
|
|
(19,114)
|
Total
shareholders' equity/(deficit)
|
|
(22,188)
|
|
(17,155)
|
TOTAL LIABILITIES
AND SHAREHOLDERS' EQUITY
|
|
5,024
|
|
9,485
|
JMU LIMITED
Reconciliation of Non-GAAP financial measures
to comparable GAAP measures
(US dollars in thousands)
|
|
|
|
|
|
|
|
|
For the periods
ended June 30
|
|
|
2018
|
|
2019
|
Loss from
operations
|
|
79,229
|
|
1,061
|
Net loss attributable
to JMU Ltd.
|
|
79,361
|
|
1,505
|
|
|
|
|
|
Amortization of
acquired intangible assets
|
a
|
646
|
|
-
|
Provision for income
tax (benefits)/expenses
|
b
|
(438)
|
|
140
|
Share-based
compensation
|
c
|
248
|
|
(293)
|
Impairment
loss
|
d
|
73,817
|
|
-
|
|
|
|
|
|
Non-GAAP loss from
operation (a)(c)(d)
|
|
4,518
|
|
1,354
|
Non-GAAP net loss
attributable to JMU Ltd.(a)(b)(c)(d)
|
|
5,088
|
|
1,658
|
|
|
|
|
|
Note:
|
|
|
|
|
(a)Adjustment to
exclude amortization of acquired intangible assets
|
|
|
|
(b)Adjustment to
exclude income tax (benefits)/expenses
|
|
|
|
|
(c)Adjustment to
exclude share-based compensation
|
|
|
|
|
(d)Adjustment to
exclude impairment loss
|
|
|
|
|
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SOURCE JMU Ltd