Baozun Announces Damage Estimates Relating to a Fire at a Third-Party Warehouse
December 16 2019 - 4:00AM
Baozun Inc. (Nasdaq: BZUN) (“Baozun” or the “Company”), the leading
brand e-commerce service partner that helps brands execute their
e-commerce strategies in China, today announced damage estimates
related to inventory held at a third-party warehouse in Shanghai
that experienced a fire on October 29, 2019.
Since the occurrence of the fire, the facility
has been cordoned off by local authorities for safety and
investigation purposes. As a result, Baozun has not yet been able
to physically access the warehouse to fully assess damage to
inventory. Based on initial findings of the local authorities
issued on December 13, 2019, Baozun has concluded that the damage
to its inventory at the warehouse is significantly greater than
previously estimated.
While the Company is still unable to access the
damaged warehouse, it plans to accrue an amount of approximately
RMB53 million, which represents the Company’s estimated maximum
loss associated with the incident and would be accrued in the
fourth quarter of 2019. Actual losses may be less than the accrued
amount. These accruals include inventory loss in the Company’s
distribution model, potential compensation to goods owned by brand
partners that receive warehousing and fulfillment services from
Baozun under the Company’s consignment model, and legal and other
expenses relating to damages incurred. At this time, the Company is
actively seeking permission from local authorities to access the
damaged warehouse.
As of October 31, 2019, Baozun operated 15
warehouses and used 19 warehouses operated by eight third-party
warehouses service providers, to service the brand partners’ demand
for warehouse services and logistic support. The warehouse damaged
in the fire had been primarily dedicated to relatively slow-moving
products, and based on order volume in October 2019, it accounted
for less than 0.5% of Baozun’s total order volume processed through
warehouses operated by Baozun and third-party warehouses.
Safe Harbor Statements
This news release contains forward-looking
statements within the meaning of Section 21E of the Securities
Exchange Act of 1934, as amended, and as defined in 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," "target," "going forward," "outlook" and
similar statements. For example, the Company’s statements about
amounts of accruals, expenses that may be incurred, determinations
of third-party liability and potential causes of action are all
forward-looking statements and inherently uncertain. Such
statements are based upon management's current expectations, and
relate to events that involve known or unknown risks, uncertainties
and other factors, such as the extent of fire damage, the outcome
of potential legal proceedings against third parties, extent of
insurance coverage, and future relationships with affected brand
partners and third-party warehouse operators, all of which are
difficult to predict and many of which are beyond the Company's
control, which may cause actual results to differ materially from
those in the forward-looking statements. Further information
regarding these and other risks, uncertainties or factors is
included in the Company's filings with the U.S. Securities and
Exchange Commission. The Company does not undertake any obligation
to update any forward-looking statement as a result of new
information, future events or otherwise, except as required under
applicable law.
About Baozun Inc.
Baozun is the leading brand e-commerce service
partner that helps brands execute their e-commerce strategies in
China by selling their goods directly to customers online or by
providing services to assist with their e-commerce operations. The
Company's integrated end-to-end brand e-commerce capabilities
encompass all aspects of the e-commerce value chain, covering IT
solutions, store operations, digital marketing, customer services,
warehousing and fulfillment.
For more information, please visit
http://ir.baozun.com
For investor and media inquiries, please
contact:
Baozun Inc.Ms. Wendy SunEmail:
ir@baozun.com
ChristensenIn ChinaMr.
Christian ArnellPhone: +86-10-5900-1548E-mail:
carnell@christensenir.com
In U.S.Ms. Linda BergkampPhone:
+1-480-614-3004Email: lbergkamp@ChristensenIR.com
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