GigaCloud Technology Inc (Nasdaq: GCT) (“GigaCloud” or the
“Company”), a pioneer of global end-to-end B2B technology solutions
for large parcel merchandise, today announced financial results for
the first quarter ended March 31, 2024, including substantial
growth in revenue, gross profit, and net income over the comparable
prior year period.
First Quarter 2024 Financial Highlights
- Total
revenues of $251.1 million, increased 96.5% from
$127.8 million in the first quarter of 2023.
- Gross
profit of $66.5 million, increased 124.7% from
$29.6 million in the first quarter of 2023.Gross
margin grew to 26.5%, up 340 basis points from 23.1% in
the first quarter of 2023.
- Net
income of $27.2 million, increased 71.1% from
$15.9 million in the first quarter of 2023.Net income
margin was 10.8%, down 160 basis points from 12.4% in the
first quarter of 2023.Diluted EPS increased 69.2%
to $0.66, from $0.39 in the first quarter of 2023.
- Adjusted
EBITDA1 increased 74.2% to $34.5 million, from
$19.8 million in the first quarter of 2023.Adjusted
EPS – diluted2 increased 71.4% to $0.84, from $0.49 in the
first quarter of 2023.
- Cash,
Restricted Cash, and Investments totaled
$196.2 million as of March 31, 2024, increased 6.5% from
$184.2 million as of December 31, 2023.
Operational Highlights
- GigaCloud
Marketplace GMV3 increased 64.0% to $907.7 million in
the 12 months ended March 31, 2024, from $553.5 million
in the 12 months ended March 31, 2023.
- 3P seller
GigaCloud Marketplace GMV4 increased 71.8% to
$489.9 million in the 12 months ended March 31, 2024,
from $285.2 million in the 12 months ended March 31,
2023. 3P seller GigaCloud Marketplace GMV represented 54.0% of
total GigaCloud Marketplace GMV in the 12 months ended
March 31, 2024, up from 51.5% in the 12 months ended
March 31, 2023.
- Active 3P
sellers5 increased 43.7% to 865 in the 12 months ended
March 31, 2024, from 602 in the 12 months ended March 31,
2023.
- Active
buyers6 increased 29.1% to 5,493 in the 12 months ended
March 31, 2024, from 4,255 in the 12 months ended
March 31, 2023.
- Spend per
active buyer7 increased 27.0% to $165,239 in the 12 months
ended March 31, 2024, from $130,083 in the 12 months ended
March 31, 2023.
“We are pleased to report exceptional growth in revenue,
accompanied by marked improvements in gross profit margin,” said
Larry Wu, Founder, Chairman and Chief Executive Officer of
GigaCloud. “Additionally, our GigaCloud Marketplace continued its
impressive momentum across all key metrics, while simultaneously
expanding its service offerings. Strategic investments in our
fulfillment infrastructure in support of our expected growth and
foreign exchange fluctuations caused a temporary decline in our net
income margin for the first quarter. We are confident that these
investments will better position GigaCloud to meet surging
Marketplace buyer and seller demands while further enhancing
efficiency.
“The introduction of our Branding-as-a-Service, or BaaS, marked
a pivotal moment for GigaCloud and the furniture industry as a
whole, especially within our marketplace where furniture is a key
category.” Mr. Wu continued, “This program allows qualified sellers
to leverage the well-established Christopher Knight Home brand to
address the longstanding challenges associated with brand building
in the furniture sector. We are observing widespread enthusiasm
from Marketplace sellers as we prepare for inaugural transactions
under the program in the second quarter. This strategic move
underscores our commitment to empower Marketplace buyers and
sellers and is an example of yet another addition to our service
toolbox designed to foster stronger loyalty and engagement among
Marketplace buyers and sellers. We are confident that our sustained
growth will unlock even greater opportunities for our buyers and
sellers, solidifying GigaCloud’s position at the forefront of
streamlining the global supply chain for large parcel merchandise
through our Supplier Fulfilled Retailing model.”
Business Outlook
The Company expects its total revenues to be between
$265 million and $280 million in the second quarter of
2024. This forecast reflects the Company’s current and preliminary
views on the market and operational conditions, which are subject
to change and cannot be predicted with reasonable accuracy as of
the date hereof.
Conference Call
The Company will host a conference call to discuss its financial
results at 8:00 am U.S. Eastern Time (8:00 pm Beijing/Hong Kong
Time) on May 9, 2024. Participants who wish to join the call should
pre-register here at
https://register.vevent.com/register/BI2d6dde94a2864239b696c2e79bc831a5.
Upon registration, participants will receive the dial-in number and
a unique PIN, which can be used to join the conference call. If
participants register and forget their PIN or lose their
registration confirmation email, they may re-register to receive a
new PIN. All participants are encouraged to dial in 15 minutes
prior to the start time.
A live and archived webcast of the conference call will be
accessible on the Company’s investor relations website at:
https://investors.gigacloudtech.com/.
About GigaCloud Technology Inc
GigaCloud Technology Inc is a pioneer of global end-to-end B2B
technology solutions for large parcel merchandise. The Company’s
B2B ecommerce platform, which it refers to as the “GigaCloud
Marketplace,” integrates everything from discovery, payments and
logistics tools into one easy-to-use platform. The Company’s global
marketplace seamlessly connects manufacturers, primarily in Asia,
with resellers, primarily in the U.S., Asia and Europe, to execute
cross-border transactions with confidence, speed and efficiency.
The Company offers a truly comprehensive solution that transports
products from the manufacturer’s warehouse to the end customer’s
doorstep, all at one fixed price. The Company first launched its
marketplace in January 2019 by focusing on the global furniture
market and has since expanded into additional categories such as
home appliances and fitness equipment. For more information, please
visit the Company’s website:
https://investors.gigacloudtech.com/.
Non-GAAP Financial Measures
The Company uses certain non-GAAP financial measures, including
Adjusted EBITDA and Adjusted EPS – diluted, to understand and
evaluate its core operating performance. Adjusted EBITDA is net
income excluding interest, income taxes and depreciation, further
adjusted to exclude share-based compensation expense. Adjusted EPS
– diluted is a financial measure defined as our Adjusted EBITDA
divided by our basic and diluted weighted-average shares
outstanding, respectively. Management uses Adjusted EBITDA and
Adjusted EPS – diluted as measures of operating performance, for
planning purposes, to allocate resources to enhance the financial
performance of our business, to evaluate the effectiveness of our
business strategies and in communications with our Board of
Directors and investors concerning our financial performance.
Non-GAAP financial measures, which may differ from similarly titled
measures used by other companies, are presented to enhance
investors’ overall understanding of our financial performance and
should not be considered a substitute for, or superior to, the
financial information prepared and presented in accordance with
U.S. GAAP.
For more information on the non-GAAP financial measures, please
see the tables captioned “Unaudited Reconciliation of Adjusted
EBITDA” and “Unaudited Reconciliation of Adjusted EPS – diluted”
set forth at the end of this press release.
Forward-Looking Statements
This press release contains “forward-looking statements”.
Forward-looking statements reflect our current view about future
events. These forward-looking statements involve known and unknown
risks and uncertainties and are based on the Company’s current
expectations and projections about future events that the Company
believes may affect its financial condition, results of operations,
business strategy and financial needs. Investors can identify these
forward-looking statements by words or phrases such as “may,”
“will,” “could,” “expect,” “anticipate,” “aim,” “estimate,”
“intend,” “plan,” “believe,” “is/are likely to,” “propose,”
“potential,” “continue” or similar expressions. The Company
undertakes no obligation to update or revise publicly any
forward-looking statements to reflect subsequent occurring events
or circumstances, or changes in its expectations, except as may be
required by law. Although the Company believes that the
expectations expressed in these forward-looking statements are
reasonable, it cannot assure you that such expectations will turn
out to be correct, and the Company cautions investors that actual
results may differ materially from the anticipated results and
encourages investors to review other factors that may affect its
future results in the Company’s registration statement and other
filings with the SEC.
For investor and media inquiries, please
contact:
GigaCloud Technology Inc
Investor Relations
Email: ir@gigacloudtech.com
PondelWilkinson, Inc.
Laurie Berman (Investors) – lberman@pondel.com
George Medici (Media) – gmedici@pondel.com
GigaCloud Technology Inc |
UNAUDITED CONDENSED CONSOLIDATED BALANCE
SHEETS |
(In thousands except for share data and per share
data) |
|
|
December 31, |
|
March 31, |
|
|
2023 |
|
|
|
2024 |
|
ASSETS |
|
|
|
Current
assets |
|
|
|
Cash |
$ |
183,283 |
|
|
$ |
185,214 |
|
Restricted cash |
|
885 |
|
|
|
894 |
|
Investments |
|
— |
|
|
|
10,075 |
|
Accounts receivable, net |
|
58,876 |
|
|
|
59,400 |
|
Inventories |
|
132,247 |
|
|
|
186,131 |
|
Prepayments and other current
assets |
|
17,516 |
|
|
|
18,940 |
|
Total current
assets |
|
392,807 |
|
|
|
460,654 |
|
Non-current
assets |
|
|
|
Operating lease right-of-use
assets |
|
398,922 |
|
|
|
459,033 |
|
Property and equipment,
net |
|
24,614 |
|
|
|
22,763 |
|
Intangible assets, net |
|
8,367 |
|
|
|
7,820 |
|
Goodwill |
|
12,586 |
|
|
|
12,586 |
|
Deferred tax assets |
|
1,440 |
|
|
|
3,360 |
|
Other non-current assets |
|
8,173 |
|
|
|
11,392 |
|
Total non-current
assets |
|
454,102 |
|
|
|
516,954 |
|
Total
assets |
$ |
846,909 |
|
|
$ |
977,608 |
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS’ EQUITY |
|
|
|
Current
liabilities |
|
|
|
Accounts payable (including
accounts payable of VIEs without recourse to the Company |
|
|
|
|
|
|
|
of $11,563 and nil as of December 31, 2023 and March 31, 2024,
respectively) |
$ |
69,757 |
|
|
$ |
86,766 |
|
Contract liabilities
(including contract liabilities of VIEs without recourse to
the |
|
|
|
|
|
|
|
Company of $736 and nil as of December 31, 2023 and March 31, 2024,
respectively) |
|
5,537 |
|
|
|
7,554 |
|
Current operating lease
liabilities (including current operating lease liabilities of
VIEs |
|
|
|
|
|
|
|
without recourse to the Company of $1,305 and nil as of December
31, 2023 and March 31, 2024, respectively) |
|
57,949 |
|
|
|
69,400 |
|
Income tax payable (including
income tax payable of VIEs without recourse to the |
|
|
|
|
|
|
|
Company of $3,644 and nil as of December 31, 2023 and March 31,
2024, respectively) |
|
15,212 |
|
|
|
21,387 |
|
Accrued expenses and other
current liabilities (including accrued expenses and other |
|
|
|
|
|
|
|
current liabilities of VIEs without recourse to the Company of
$2,774 and nil as of December 31, 2023 and March 31, 2024,
respectively) |
|
57,319 |
|
|
|
66,572 |
|
Total current
liabilities |
|
205,774 |
|
|
|
251,679 |
|
Non-current
liabilities |
|
|
|
Operating lease liabilities,
non-current (including operating lease liabilities, non-current of
VIEs without recourse to the Company of $553 and nil as of December
31, 2023 and March 31, 2024, respectively) |
|
343,511 |
|
|
|
400,988 |
|
Deferred tax liabilities |
|
3,795 |
|
|
|
3,683 |
|
Finance lease obligations,
non-current |
|
111 |
|
|
|
122 |
|
Non-current income tax
payable |
|
3,302 |
|
|
|
3,357 |
|
Total non-current
liabilities |
|
350,719 |
|
|
|
408,150 |
|
Total
liabilities |
$ |
556,493 |
|
|
$ |
659,829 |
|
Commitments and
contingencies |
|
|
|
Shareholders’
equity |
|
|
|
Treasury shares, at cost
(294,029 and 292,637 shares held as of December 31, 2023 and March
31, 2024, respectively) |
$ |
(1,594 |
) |
|
$ |
(1,594 |
) |
Class A ordinary shares ($0.05
par value, 50,673,268 shares authorized, 31,738,632 and 33,003,452
shares issued as of December 31, 2023 and March 31, 2024,
respectively, 31,455,148 and 32,720,692 shares outstanding as of
December 31, 2023 and March 31, 2024, respectively) |
|
1,584 |
|
|
|
1,648 |
|
Class B ordinary shares ($0.05
par value, 9,326,732 shares authorized as of December 31, 2023 and
March 31, 2024, respectively, 9,326,732 and 8,076,732 shares issued
and outstanding as of December 31, 2023 and March 31, 2024,
respectively) |
|
466 |
|
|
|
403 |
|
Additional paid-in
capital |
|
111,736 |
|
|
|
112,015 |
|
Accumulated other
comprehensive income |
|
526 |
|
|
|
414 |
|
Retained earnings |
|
177,698 |
|
|
|
204,893 |
|
Total shareholders’
equity |
|
290,416 |
|
|
|
317,779 |
|
Total liabilities and
shareholders’ equity |
$ |
846,909 |
|
|
$ |
977,608 |
|
GigaCloud Technology Inc |
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF
COMPREHENSIVE INCOME |
(In thousands except for share data and per share
data) |
|
|
Three Months Ended March 31, |
|
|
2023 |
|
|
|
2024 |
|
Revenues |
|
|
|
Service revenues |
$ |
35,096 |
|
|
$ |
67,415 |
|
Product revenues |
|
92,701 |
|
|
|
183,662 |
|
Total
revenues |
|
127,797 |
|
|
|
251,077 |
|
Cost of
revenues |
|
|
|
Services |
|
28,767 |
|
|
|
54,431 |
|
Product sales |
|
69,456 |
|
|
|
130,098 |
|
Total cost of
revenues |
|
98,223 |
|
|
|
184,529 |
|
Gross profit |
|
29,574 |
|
|
|
66,548 |
|
Operating
expenses |
|
|
|
Selling and marketing
expenses |
|
6,896 |
|
|
|
14,580 |
|
General and administrative
expenses |
|
4,150 |
|
|
|
15,389 |
|
Research and development
expenses |
|
672 |
|
|
|
1,756 |
|
Losses on disposal of property
and equipment |
|
— |
|
|
|
6 |
|
Total operating
expenses |
|
11,718 |
|
|
|
31,731 |
|
Operating income |
|
17,856 |
|
|
|
34,817 |
|
Interest expense |
|
(113 |
) |
|
|
(81 |
) |
Interest income |
|
590 |
|
|
|
1,609 |
|
Foreign currency exchange
gains (losses), net |
|
1,385 |
|
|
|
(2,709 |
) |
Government grants |
|
— |
|
|
|
6 |
|
Others, net |
|
(21 |
) |
|
|
(322 |
) |
Income before income taxes |
|
19,697 |
|
|
|
33,320 |
|
Income tax expense |
|
(3,756 |
) |
|
|
(6,125 |
) |
Net
income |
$ |
15,941 |
|
|
$ |
27,195 |
|
Net income
attributable to ordinary shareholders |
|
15,941 |
|
|
|
27,195 |
|
Foreign currency translation
adjustment, net of nil income taxes |
|
(194 |
) |
|
|
(112 |
) |
Total other
comprehensive income (loss) |
|
(194 |
) |
|
|
(112 |
) |
Comprehensive
Income |
$ |
15,747 |
|
|
$ |
27,083 |
|
Net income per
ordinary share |
|
|
|
—Basic |
$ |
0.39 |
|
|
$ |
0.67 |
|
—Diluted |
$ |
0.39 |
|
|
$ |
0.66 |
|
Weighted average
number of ordinary shares outstanding used in computing net income
per ordinary share |
|
|
|
—Basic |
|
40,716,501 |
|
|
|
40,788,658 |
|
—Diluted |
|
40,716,501 |
|
|
|
40,950,170 |
|
GigaCloud Technology Inc |
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS |
(In thousands) |
|
|
Three Months EndedMarch 31, |
|
|
2023 |
|
|
|
2024 |
|
Cash flows from
operating activities: |
|
|
|
Net
income |
$ |
15,941 |
|
|
$ |
27,195 |
|
Adjustments to reconcile net
income to net cash provided by operating activities: |
|
|
|
Allowance for doubtful accounts |
|
55 |
|
|
|
63 |
|
Inventory write-down |
|
242 |
|
|
|
304 |
|
Deferred tax |
|
(145 |
) |
|
|
(2,034 |
) |
Share-based compensation |
|
247 |
|
|
|
275 |
|
Depreciation and amortization |
|
380 |
|
|
|
2,081 |
|
Loss from disposal of property and equipment |
|
— |
|
|
|
6 |
|
Operating lease |
|
450 |
|
|
|
8,806 |
|
Interest income |
|
— |
|
|
|
(75 |
) |
Unrealized foreign currency exchange gains |
|
(419 |
) |
|
|
(686 |
) |
Others |
|
— |
|
|
|
1,859 |
|
Changes in operating assets
and liabilities: |
|
|
|
Accounts receivable |
|
(2,705 |
) |
|
|
(632 |
) |
Inventories |
|
(2,344 |
) |
|
|
(56,047 |
) |
Prepayments and other assets |
|
(2,266 |
) |
|
|
(2,289 |
) |
Accounts payable |
|
1,738 |
|
|
|
16,881 |
|
Contract liabilities |
|
125 |
|
|
|
2,045 |
|
Income tax payable |
|
3,697 |
|
|
|
6,552 |
|
Accrued expenses and other current liabilities |
|
5,350 |
|
|
|
11,005 |
|
Net cash provided by
operating activities |
|
20,346 |
|
|
|
15,309 |
|
Cash flows from
investing activities: |
|
|
|
Cash paid for purchase of property and equipment |
|
(137 |
) |
|
|
(3,993 |
) |
Cash received from disposal of property and equipment |
|
— |
|
|
|
1,525 |
|
Purchases of investments |
|
— |
|
|
|
(10,000 |
) |
Net cash used in
investing activities |
|
(137 |
) |
|
|
(12,468 |
) |
Cash flows from
financing activities: |
|
|
|
Repayment of finance lease obligations |
|
(840 |
) |
|
|
(595 |
) |
Repayment of bank loans |
|
(76 |
) |
|
|
— |
|
Net cash used in
financing activities |
|
(916 |
) |
|
|
(595 |
) |
Effect of foreign currency
exchange rate changes on cash and restricted cash |
|
(159 |
) |
|
|
(306 |
) |
Net increase in cash
and restricted cash |
|
19,134 |
|
|
|
1,940 |
|
Cash and restricted cash at
the beginning of the period |
|
145,076 |
|
|
|
184,168 |
|
Cash and restricted
cash at the end of the period |
|
164,210 |
|
|
|
186,108 |
|
Supplemental
disclosure of cash flow information |
|
|
|
Cash paid for interest
expense |
|
113 |
|
|
|
81 |
|
Cash paid for income
taxes |
$ |
204 |
|
|
$ |
1,596 |
|
GigaCloud Technology Inc |
UNAUDITED RECONCILIATION OF ADJUSTED EBITDA |
(In thousands, except for per share data) |
|
|
|
Three Months EndedMarch 31, |
|
|
2023 |
|
|
|
2024 |
|
Net
Income |
$ |
15,941 |
|
|
$ |
27,195 |
|
Add: Income tax expense |
|
3,756 |
|
|
|
6,125 |
|
Add: Interest expense |
|
113 |
|
|
|
81 |
|
Less: Interest income |
|
(590 |
) |
|
|
(1,609 |
) |
Add: Depreciation and
amortization |
|
380 |
|
|
|
2,081 |
|
Add: Share-based compensation
expenses |
|
247 |
|
|
|
275 |
|
Add: Non-recurring
items(1) |
|
— |
|
|
|
349 |
|
Adjusted
EBITDA |
$ |
19,847 |
|
|
$ |
34,497 |
|
_____________________(1) During
the three months ended March 31, 2024, one of our fulfillment
centers in Japan experienced a fire. As a result of the fire, we
recognized losses of $1.8 million. Based on the provisions of our
insurance policy, we have determined that partial recovery of the
incurred losses is probable as of March 31, 2024 and therefore
recorded an insurance recovery of $1.5 million. We do not believe
such losses to be recurring or frequent in nature.
UNAUDITED RECONCILIATION OF ADJUSTED EPS –
DILUTED |
|
|
Three Months EndedMarch 31, |
|
|
2023 |
|
|
|
2024 |
|
Net income per
ordinary share – diluted |
$ |
0.39 |
|
|
$ |
0.66 |
|
Adjustments, per ordinary
share: |
|
|
|
Add: Income tax expense |
|
0.09 |
|
|
|
0.15 |
|
Add: Interest expense |
|
— |
|
|
|
— |
|
Less: Interest income |
|
(0.01 |
) |
|
|
(0.04 |
) |
Add: Depreciation and
amortization |
|
0.01 |
|
|
|
0.05 |
|
Add: Share-based compensation
expenses |
|
0.01 |
|
|
|
0.01 |
|
Add: Non-recurring
items(1) |
|
— |
|
|
|
0.01 |
|
Adjusted EPS –
diluted |
$ |
0.49 |
|
|
$ |
0.84 |
|
|
|
|
|
Weighted average number of
ordinary shares outstanding - diluted |
|
40,716,501 |
|
|
|
40,950,170 |
|
_____________________(1) During
the three months ended March 31, 2024, one of our fulfillment
centers in Japan experienced a fire. As a result of the fire, we
recognized losses of $1.8 million. Based on the provisions of our
insurance policy, we have determined that partial recovery of the
incurred losses is probable as of March 31, 2024 and therefore
recorded an insurance recovery of $1.5 million. We do not believe
such losses to be recurring or frequent in nature.
_____________________
1 Adjusted EBITDA is a non-GAAP financial measure.
For more information on the non-GAAP financial measure, please see
the section of “Non-GAAP Financial Measure” and the table captioned
“Unaudited Reconciliation of Adjusted EBITDA” set forth at the end
of this press release.
2 Adjusted EPS – diluted is a non-GAAP financial
measure. For more information on the non-GAAP financial measure,
please see the section of “Non-GAAP Financial Measure” and the
table captioned “Unaudited Reconciliation of Adjusted EPS –
diluted” set forth at the end of this press release.
3 GigaCloud Marketplace GMV means the total gross
merchandise value of transactions ordered through our GigaCloud
Marketplace including GigaCloud 3P and GigaCloud 1P, before any
deductions of value added tax, goods and services tax, shipping
charges paid by buyers to sellers and any refunds.
4 3P seller GigaCloud Marketplace GMV means the total
gross merchandise value of transactions sold through our GigaCloud
Marketplace by 3P sellers, before any deductions of value added
tax, goods and services tax, shipping charges paid by buyers to
sellers and any refunds.
5 Active 3P sellers means sellers who have sold a
product in GigaCloud Marketplace within the last 12-month period,
irrespective of cancellations or returns.
6 Active buyers means buyers who have purchased a
product in the GigaCloud Marketplace within the last 12-month
period, irrespective of cancellations or returns.
7 Spend per active buyer is calculated by dividing
the total GigaCloud Marketplace GMV within the
last 12-month period by the number of active buyers as of
such date.
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