81.2 million Sold Items, up 57.5%, 73.2 million
Total Payment Transactions, up 72.2%
MercadoLibre, Inc. (Nasdaq:MELI) (http://www.mercadolibre.com), the
largest online commerce ecosystem in Latin America, today reported
financial results for the fourth quarter and fiscal year ended
December 31, 2017.
Pedro Arnt, Chief Financial Officer of
MercadoLibre, Inc., commented, “Some of the main structural factors
that underpin ecommerce and fintech in Latin America are beginning
to take shape through the growth of the installed base of
smartphones, increasing consumer familiarity and affinity with
buying and transacting online, greater number of broadband users,
rising demand for online financial services, and growing interest
on behalf of traditional retailers and brands to find technology
partners to support them in developing their digital strategies.
All of the aforementioned structural factors will be the catalysts
that will continue to fuel the growth of Mercado Libre in the
region for many years to come.”
Full Year 2017 Operational & Financial
Highlights
- MercadoLibre sold 270.1 million items during 2017, a
year-over-year increase of 49.1%, resulting in Gross Merchandise
Volume of $11.7 billion.
- MercadoPago ended 2017 with 231.4 million Total Payment
Transactions for the year, an increase of 66.8%, resulting in a
full-year Total Payment Volume of $13.7 billion.
- MercadoEnvíos shipped 150.7 million items during 2017, a 74.2%
increase as compared to 2016.
- Consolidated Net Revenues for 2017 were $1,398.1 million, a
65.6% year-over-year increase in USD.
- Full-year net income was $13.8 million, or $0.31 per
share.
- Effective December 1, 2017, the Company determined that it no
longer has accounting control of its subsidiaries in Venezuela as a
result of the country’s recent selective default determination,
restrictive exchange controls and other operating restrictions, all
of which have significantly hindered the Company’s ability to make
key financial decisions. As a result, the Company has decided to
deconsolidate its Venezuelan operations as of December 1,
2017.
- The Company will no longer include the results of its
Venezuelan subsidiaries in its consolidated financial statements.
However, Mercado Libre will remain fully committed to serving its
Venezuelan users and will continue to operate in Venezuela after
the aforementioned deconsolidation.
Fourth Quarter 2017 Business
Highlights
- Gross Merchandise Volume was $3,617.7 million, reflecting a
62.8% year-over-year increase in USD and a 132.4% increase on an FX
neutral basis. Items sold during the fourth quarter of 2017
increased to 81.2 million, a 57.5% year-over-year increase.
- Successful items per unique buyer grew to 4.6 from 3.9 last
year, a 17.1% year-over-year increase.
- We continue to grow the number of listings in our platform,
ending the year with over 114.2 million listings, a 56.0%
year-over-year increase.
- MercadoPago ended the year with an extraordinary fourth
quarter, processing $4,342.8 million in payments, a 77.5%
year-over-year increase. Total Payment Transactions through
MercadoPago grew to 73.2 million, a 72.2% year-over-year
increase.
- Penetration of MercadoPago in countries beyond Brazil, Mexico
and Argentina continues to increase. On platform penetration in
Colombia and Chile rose to 81.8% and 75.0% versus 60.3%and 41.5%
when compared to the fourth quarter of 2016, respectively.
- Mobile engagement continues to grow as we move from a desktop
centric model to a multi-device ecosystem, already representing 50%
of our GMV during the fourth quarter of 2017.
- Successful execution of commercial initiatives, automated
onboarding of small merchants, strong seasonal campaigns and
outstanding results in our mobile payments initiatives resulted in
off platform payment volume growth on an FX neutral basis of 127.9%
year-over-year.
- As compared to the fourth quarter of 2016, we multiplied the
number of mobile point-of-sale devices sold in Brazil by nearly 13
times, while in Argentina we have grown sales of devices by a
factor of 20.
- Items shipped through MercadoEnvíos increased 86.9%, to 48.3
million items delivered in the fourth quarter. The service
continues to gain adoption across the board; MercadoEnvíos arranged
shipping for 75.5% of items sold on our platform in Brazil, 74.8%
in Mexico, 60.5% in Colombia, 46.7% in Chile and 31.0% in
Argentina.
- Free shipping penetration continues to gain traction as well,
as over 70% of shipped GMV is already being done with free
shipping.
- We are making meaningful advances in taking our classifieds
business to a transactional model, with our down payment pilot
launch in Brazil and Argentina.
Fourth Quarter 2017 Financial
Highlights
- Net revenues for the fourth quarter were $437.0 million, a
year-over-year increase of 70.5% in USD and 99.6% on an FX neutral
basis. Marketplace revenues grew 71.2% in USD, and 116.1% on an FX
neutral basis, while non-marketplace revenues grew 69.5% in USD and
76.4% on an FX neutral basis.
- Gross profit for the fourth quarter of 2017 was $203.4 million.
Gross profit margin was 46.5%, compared to 63.5% in the fourth
quarter of 2016. Most of the margin compression is explained by
increases in costs associated with our free shipping & loyalty
programs.
- We incurred a $85.8 million loss as a result of the
deconsolidation of our Venezuelan operations.
- Total operating expenses increased to $268.0 million, up 173.3%
year-over-year on an as reported basis. As a percentage of
revenues, operating expenses were 61.3% versus 38.3% in the fourth
quarter of 2016.
- Income from operations was negative $64.6 million, down 199.9%
year-over-year on an as reported basis.
- Interest income contracted 13.4% year-over-year, ending the
quarter with $8.9 million, due to lower interest rates in Brazil
and Argentina.
- The company incurred $6.8 million dollars in financial
expenses, mainly as a consequence of interest payments on its
Convertible Bond issued in June of 2014.
- Foreign currency exchange saw a $2.1 million dollar loss due to
local currency devaluations.
- Net income before taxes was negative $64.7 million, down 195.6%
year-over-year on an as reported basis.
- Income tax expense was $3.0 million during the fourth
quarter.
- Net loss as reported for the fourth quarter was $67.7 million
dollars, resulting in basic net loss per common share of
$1.53.
- Net cash provided by operating activities was $26.6 million.
Net decrease in cash and cash equivalents was $72.9 million dollars
for the three months ended December 31st (*).
- Excluding Venezuela, revenues would have been $421.0 million, a
71.1% year-over-year increase. Total operating expenses would have
been $178.2 million, or 42.3% of net revenues versus 38.1% in the
fourth quarter of 2016. Net income would have been $8.8 million
dollars, a margin of 2.0%, and earnings per share of 20 cents, vs
19.7% and $1.10 a year ago respectively.
(*)Three month period ended December 31st is
calculated by taking the difference between twelve months ended
December 31st and nine months ended September 30th
Fourth Quarter 2017 Corporate
Highlights
- During the fiscal year ended December 31, 2017, the
Company approved total cash dividends for a total amount of $26,496
thousand or $0.600 per share, all of which had been paid as of
year-end, except for the one approved in October 2017, consisting
of $6,624 thousand (or $0.150 per share, which was paid on
January 12, 2018) to stockholders of record as of the close of
business on December 31, 2017.
- After reviewing our capital allocation process the Board of
Directors has concluded that the Company has multiple investment
opportunities that should generate greater returns to shareholders
through investing capital into the business than issuing a
dividend. Consequently, the decision has been made to suspend the
payment of dividend to shareholders as of the first quarter of
2018, as it will free up capital for investment in multiple
projects in our various platforms.
The following table summarizes certain key performance
metrics for the three months ended December 31, 2017 and
2016.
|
|
Three months ended December 31, (in
MM) |
|
|
|
2017 |
|
2016 |
%YoY |
|
%YoY Local Currency |
|
Total confirmed
registered users at the end of period |
|
211.9 |
|
174.2 |
21.7 |
% |
|
|
New confirmed
registered users during the period |
|
10.7 |
|
7.9 |
36.2 |
% |
|
|
Gross merchandise
volume |
$ |
3,618 |
$ |
2,222 |
62.8 |
% |
132.4 |
% |
|
Number of
successful items sold |
|
81.2 |
|
51.6 |
57.5 |
% |
|
|
Number of
successful items shipped |
|
48.3 |
|
25.9 |
86.9 |
% |
|
|
Total payment
volume |
$ |
4,343 |
$ |
2,447 |
77.5 |
% |
94.5 |
% |
|
Total volume of
payments on marketplace |
$ |
3,007 |
$ |
1,760 |
70.9 |
% |
|
|
Tota payments
transactions |
|
73.2 |
|
42.5 |
72.2 |
% |
|
|
Unique
Buyers |
|
17.7 |
|
13.2 |
34.5 |
% |
|
|
Unique
Sellers |
|
4.6 |
|
3.9 |
16.8 |
% |
|
Table of Year-over-Year Local Currency Revenue Growth
Rates by Quarter
|
|
YoY Growth rates |
|
Consolidated Net Revenues |
|
|
|
|
|
|
|
Q4'16 |
Q1'17 |
Q2'17 |
Q3'17 |
Q4'17 |
|
Brazil |
64 |
% |
66 |
% |
60 |
% |
71 |
% |
79 |
% |
|
Argentina |
60 |
% |
58 |
% |
44 |
% |
51 |
% |
62 |
% |
|
Mexico |
29 |
% |
55 |
% |
80 |
% |
82 |
% |
124 |
% |
|
Venezuela |
199 |
% |
291 |
% |
353 |
% |
571 |
% |
650 |
% |
|
Others |
42 |
% |
36 |
% |
34 |
% |
55 |
% |
59 |
% |
|
Total |
68 |
% |
79 |
% |
65 |
% |
79 |
% |
100 |
% |
Table of Year-over-Year USD Revenue Growth Rates by
Quarter
|
YoY Growth rates |
Consolidated Net Revenues |
|
|
|
|
|
|
Q4'16 |
Q1'17 |
Q2'17 |
Q3'17 |
Q4'17 |
Brazil |
92 |
% |
106 |
% |
75 |
% |
75 |
% |
82 |
% |
Argentina |
4 |
% |
48 |
% |
30 |
% |
30 |
% |
42 |
% |
Mexico |
8 |
% |
40 |
% |
76 |
% |
91 |
% |
136 |
% |
Venezuela |
-10 |
% |
19 |
% |
90 |
% |
42 |
% |
49 |
% |
Others |
46 |
% |
47 |
% |
39 |
% |
57 |
% |
62 |
% |
Total |
42 |
% |
74 |
% |
59 |
% |
61 |
% |
70 |
% |
Conference Call and Webcast
The Company will host a conference call and audio webcast on
February 22, 2018 at 4:30 p.m. Eastern Time. The conference call
may be accessed by dialing +(970) 315-0420 or +(877) 303-7209
(Conference ID 2790306) and requesting inclusion in the call for
Mercado Libre. The live conference call can be accessed via audio
webcast at the investor relations section of the Company's website,
at http://investor.mercadolibre.com. An archive of the webcast will
be available for one week following the conclusion of the
conference call.
Definition of Selected Operational Metrics
Foreign Exchange (“FX”) Neutral – Calculated by using the
average monthly exchange rate of each month of 2016 and applying it
to the corresponding months in the current year, so as to calculate
what the results would have been had exchange rates remained
constant. Intercompany allocations are excluded from this
calculation. These calculations do not include any other
macroeconomic effect such as local currency inflation effects or
any price adjustment to compensate local currency inflation or
devaluations.
Gross merchandise volume – Measure of the total U.S. dollar sum
of all transactions completed through the Mercado Libre
Marketplace, excluding motor vehicles, vessels, aircraft and real
estate.
Total payment transactions – Measure of the number of all
transactions paid for using MercadoPago.
Total volume of payments on marketplace - Measure of the total
U.S. dollar sum of all marketplace transactions paid for using
MercadoPago, excluding shipping and financing fees.
Total payment volume – Measure of total U.S. dollar sum of all
transactions paid for using MercadoPago, including marketplace and
non-marketplace transactions.
Items sold – Measure of the number of items sold/purchased
through the Mercado Libre Marketplace.
Items shipped- Measure of the number of items that were
shipped through our shipping service.
Local Currency Growth Rates – Refer to FX Neutral
definition.
Net income margin – Defined as net income as a percentage of net
revenues.
New confirmed registered users – Measure of the number of new
users who have registered on the Mercado Libre platform (including
Mercado Pago) and confirmed their registration. Since July’12,
registration and confirmation take place in the same step of the
registration flow.
Operating margin – Defined as income from operations as a
percentage of net revenues.
Total confirmed registered users – Measure of the cumulative
number of users who have registered on the Mercado Libre platform
(including Mercado Pago) and confirmed their registration. Since
July ’12, registration and confirmation take place in the same step
of the registration flow.
Unique Buyers – New or existing buyers with at least one
purchase made in the period.
Unique Sellers – New or existing sellers with at least one sale
made in the period.
About Mercado Libre
Founded in 1999, Mercado Libre is one of the largest online
commerce ecosystems in Latin America. Through its primary
platforms, Mercado Libre.com and MercadoPago.com, it provides
solutions to individuals and companies buying, selling,
advertising, and paying for goods and services online.
Mercadolibre.com serves millions of users and creates a market
for a wide variety of goods and services in an easy, safe and
efficient way. The site is among the top 50 in the world in terms
of page views and is the leading retail platform in unique visitors
in the major countries in which it operates according to metrics
provided by comScore Networks. The Company is listed on
NASDAQ (Nasdaq:MELI) since its initial public offering in 2007.
For more information about the Company visit:
http://investor.mercadolibre.com.
The Mercado Libre, Inc. logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=4193
Forward-Looking Statements
Any statements herein regarding MercadoLibre, Inc. that are not
historical or current facts are forward-looking statements. These
forward-looking statements convey MercadoLibre, Inc.’s current
expectations or forecasts of future events. Forward-looking
statements regarding MercadoLibre, Inc. involve known and unknown
risks, uncertainties and other factors that may cause MercadoLibre,
Inc.’s actual results, performance or achievements to be materially
different from any future results, performances or achievements
expressed or implied by the forward-looking statements. Certain of
these risks and uncertainties are described in the “Risk Factors,”
“Forward-Looking Statements” and “Cautionary Note Regarding
Forward-Looking Statements” sections of MercadoLibre, Inc’s annual
report on Form 10-K for the year ended December 31, 2017, and any
of MercadoLibre, Inc.’s other applicable filings with the
Securities and Exchange Commission. Unless required by law,
MercadoLibre, Inc. undertakes no obligation to publicly update or
revise any forward-looking statements to reflect circumstances or
events after the date hereof.
Consolidated balance sheets(In
thousands of U.S. dollars, except par value)
|
December 31, |
|
December 31, |
|
|
2017 |
|
|
|
2016 |
|
Assets |
|
|
|
Current assets: |
|
|
|
Cash and
cash equivalents |
$ |
388,260 |
|
|
$ |
234,140 |
|
Short-term investments |
|
209,432 |
|
|
|
253,321 |
|
Accounts
receivable, net |
|
28,168 |
|
|
|
25,435 |
|
Credit
cards receivable, net |
|
521,130 |
|
|
|
307,904 |
|
Loans
receivable, net |
|
73,409 |
|
|
|
6,283 |
|
Prepaid
expenses |
|
5,864 |
|
|
|
15,060 |
|
Inventory |
|
2,549 |
|
|
|
1,103 |
|
Other
assets |
|
58,107 |
|
|
|
26,215 |
|
Total
current assets |
|
1,286,919 |
|
|
|
869,461 |
|
Non-current
assets: |
|
|
|
Long-term
investments |
|
34,720 |
|
|
|
153,803 |
|
Property
and equipment, net |
|
114,837 |
|
|
|
124,261 |
|
Goodwill |
|
92,279 |
|
|
|
91,797 |
|
Intangible assets, net |
|
23,174 |
|
|
|
26,277 |
|
Deferred
tax assets |
|
57,324 |
|
|
|
45,017 |
|
Other
assets |
|
63,934 |
|
|
|
56,819 |
|
Total
non-current assets |
|
386,268 |
|
|
|
497,974 |
|
Total
assets |
$ |
1,673,187 |
|
|
$ |
1,367,435 |
|
|
|
|
|
Liabilities and Equity |
|
|
|
Current
liabilities: |
|
|
|
Accounts
payable and accrued expenses |
$ |
221,095 |
|
|
$ |
105,106 |
|
Funds
payable to customers |
|
583,107 |
|
|
|
370,693 |
|
Salaries
and social security payable |
|
65,053 |
|
|
|
48,898 |
|
Taxes
payable |
|
32,150 |
|
|
|
27,338 |
|
Loans
payable and other financial liabilities |
|
56,325 |
|
|
|
11,583 |
|
Other
liabilities |
|
3,678 |
|
|
|
6,359 |
|
Dividends
payable |
|
6,624 |
|
|
|
6,624 |
|
Total
current liabilities |
|
968,032 |
|
|
|
576,601 |
|
Non-current
liabilities: |
|
|
|
Salaries
and social security payable |
|
25,002 |
|
|
|
16,173 |
|
Loans
payable and other financial liabilities |
|
312,089 |
|
|
|
301,940 |
|
Deferred
tax liabilities |
|
23,819 |
|
|
|
34,059 |
|
Other
liabilities |
|
18,466 |
|
|
|
9,808 |
|
Total
non-current liabilities |
|
379,376 |
|
|
|
361,980 |
|
Total
liabilities |
$ |
1,347,408 |
|
|
$ |
938,581 |
|
|
|
|
|
Equity: |
|
|
|
|
|
|
|
Common
stock, $0.001 par value, 110,000,000 shares authorized, |
|
|
|
44,157,364 shares issued and outstanding at December 31, |
|
|
|
2017 and
December 31, 2016 |
$ |
44 |
|
|
$ |
44 |
|
Additional paid-in capital |
|
70,661 |
|
|
|
137,982 |
|
Retained
earnings |
|
537,925 |
|
|
|
550,641 |
|
Accumulated other comprehensive loss |
|
(282,851 |
) |
|
|
(259,813 |
) |
Total
Equity |
|
325,779 |
|
|
|
428,854 |
|
Total
Liabilities and Equity |
$ |
1,673,187 |
|
|
$ |
1,367,435 |
|
Consolidated statements of cash
flows(In thousands of U.S. dollars, except par
value)
|
|
Year Ended December 31, |
|
|
|
2017 |
|
|
|
2016 |
|
|
|
2015 |
|
|
|
|
Cash flows from
operations: |
|
|
|
|
|
|
Net
income attributable to MercadoLibre, Inc. Shareholders |
|
$ |
13,780 |
|
|
$ |
136,366 |
|
|
$ |
105,789 |
|
Adjustments to reconcile net income to net cash provided by
operating activities: |
|
|
|
|
|
|
Unrealized Devaluation Loss, net |
|
|
28,463 |
|
|
|
4,967 |
|
|
|
14,717 |
|
Impairment of Long-Lived Assets |
|
|
2,837 |
|
|
|
13,717 |
|
|
|
16,226 |
|
Loss on
deconsolidation of Venezuelan subsidiaries |
|
|
85,761 |
|
|
|
— |
|
|
|
— |
|
Depreciation and amortization |
|
|
40,921 |
|
|
|
29,022 |
|
|
|
23,209 |
|
Accrued
interest |
|
|
(20,192 |
) |
|
|
(17,794 |
) |
|
|
(12,783 |
) |
Non cash
interest and convertible bonds amortization of debt discount and
amortization of debt issuance costs |
|
|
10,855 |
|
|
|
9,837 |
|
|
|
17,272 |
|
LTRP
accrued compensation |
|
|
35,719 |
|
|
|
22,983 |
|
|
|
10,213 |
|
Deferred
income taxes |
|
|
(24,575 |
) |
|
|
(6,188 |
) |
|
|
4,354 |
|
Changes
in assets and liabilities: |
|
|
|
|
|
|
Accounts
receivable |
|
|
(21,817 |
) |
|
|
(15,428 |
) |
|
|
(36,476 |
) |
Credit
cards receivable |
|
|
(257,563 |
) |
|
|
(180,592 |
) |
|
|
(109,139 |
) |
Prepaid
expenses |
|
|
8,670 |
|
|
|
(9,133 |
) |
|
|
(3,907 |
) |
Inventory |
|
|
(1,549 |
) |
|
|
(787 |
) |
|
|
(237 |
) |
Other
assets |
|
|
(54,780 |
) |
|
|
(24,425 |
) |
|
|
(2,340 |
) |
Accounts
payable and accrued expenses |
|
|
150,215 |
|
|
|
47,980 |
|
|
|
63,668 |
|
Funds
payable to customers |
|
|
242,037 |
|
|
|
164,060 |
|
|
|
119,353 |
|
Other
liabilities |
|
|
7,680 |
|
|
|
(45 |
) |
|
|
1,765 |
|
Interest
received from investments |
|
|
22,548 |
|
|
|
15,719 |
|
|
|
9,686 |
|
Net cash
provided by operating activities |
|
|
269,010 |
|
|
|
190,259 |
|
|
|
221,370 |
|
Cash flows from
investing activities: |
|
|
|
|
|
|
Purchase
of investments |
|
|
(4,553,649 |
) |
|
|
(3,501,283 |
) |
|
|
(1,949,769 |
) |
Proceeds
from sale and maturity of investments |
|
|
4,713,934 |
|
|
|
3,508,293 |
|
|
|
1,875,516 |
|
Payment
for acquired businesses, net of cash acquired |
|
|
(8,568 |
) |
|
|
(7,284 |
) |
|
|
(45,009 |
) |
Reduction
of cash due to Venezuela deconsolidation |
|
|
(27,230 |
) |
|
|
— |
|
|
|
— |
|
Purchases
of intangible assets |
|
|
(33 |
) |
|
|
(431 |
) |
|
|
(1,746 |
) |
Changes
in principal loans receivable, net |
|
|
(72,244 |
) |
|
|
(6,599 |
) |
|
|
— |
|
Advance
for property and equipment |
|
|
(19,695 |
) |
|
|
(8,412 |
) |
|
|
(23,380 |
) |
Purchases
of property and equipment |
|
|
(55,156 |
) |
|
|
(68,527 |
) |
|
|
(39,150 |
) |
Net cash
used in investing activities |
|
|
(22,641 |
) |
|
|
(84,243 |
) |
|
|
(183,538 |
) |
Cash flows from
financing activities: |
|
|
|
|
|
|
Proceeds
from loans payable and other financial liabilities |
|
|
47,905 |
|
|
|
11,435 |
|
|
|
5,033 |
|
Payments
on loans payable and other financing |
|
|
(5,004 |
) |
|
|
(6,684 |
) |
|
|
(9,059 |
) |
Dividends
paid |
|
|
(26,496 |
) |
|
|
(24,419 |
) |
|
|
(20,974 |
) |
Purchase
of convertible note capped call |
|
|
(67,308 |
) |
|
|
— |
|
|
|
— |
|
Repurchase of Common Stock |
|
|
— |
|
|
|
— |
|
|
|
(2,714 |
) |
Net cash used in
financing activities |
|
|
(50,903 |
) |
|
|
(19,668 |
) |
|
|
(27,714 |
) |
Effect of
exchange rate changes on cash and cash equivalents |
|
|
(41,346 |
) |
|
|
(19,089 |
) |
|
|
(66,381 |
) |
Net increase (decrease)
in cash and cash equivalents |
|
|
154,120 |
|
|
|
67,259 |
|
|
|
(56,263 |
) |
Cash and cash
equivalents, beginning of the year |
|
$ |
234,140 |
|
|
|
166,881 |
|
|
|
223,144 |
|
Cash and cash
equivalents, end of the year |
|
$ |
388,260 |
|
|
$ |
234,140 |
|
|
$ |
166,881 |
|
Consolidated statements of income(In
thousands of U.S. dollars, except for share data)
|
|
Year Ended December 31, |
|
Three Months Ended December 31, |
|
|
|
2017 |
|
|
|
2016 |
|
|
|
2015 |
|
|
|
2017 |
|
|
|
2016 |
|
Net revenues |
|
$ |
1,398,095 |
|
|
$ |
844,396 |
|
|
$ |
651,790 |
|
|
$ |
436,978 |
|
|
$ |
256,275 |
|
Cost of net
revenues |
|
|
(678,495 |
) |
|
|
(307,538 |
) |
|
|
(214,994 |
) |
|
|
(233,616 |
) |
|
|
(93,546 |
) |
Gross profit |
|
|
719,600 |
|
|
|
536,858 |
|
|
|
436,796 |
|
|
|
203,362 |
|
|
|
162,729 |
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
Product
and technology development |
|
|
(127,160 |
) |
|
|
(98,479 |
) |
|
|
(76,423 |
) |
|
|
(34,161 |
) |
|
|
(26,256 |
) |
Sales and
marketing |
|
|
(325,375 |
) |
|
|
(156,296 |
) |
|
|
(128,609 |
) |
|
|
(117,433 |
) |
|
|
(48,554 |
) |
General
and administrative |
|
|
(122,194 |
) |
|
|
(87,310 |
) |
|
|
(76,342 |
) |
|
|
(30,620 |
) |
|
|
(23,250 |
) |
Impairment of Long-Lived Assets |
|
|
(2,837 |
) |
|
|
(13,717 |
) |
|
|
(16,226 |
) |
|
|
— |
|
|
|
— |
|
Loss on
deconsolidation of Venezuelan subsidiaries |
|
|
(85,761 |
) |
|
|
— |
|
|
|
— |
|
|
|
(85,761 |
) |
|
|
— |
|
Total
operating expenses |
|
|
(663,327 |
) |
|
|
(355,802 |
) |
|
|
(297,600 |
) |
|
|
(267,975 |
) |
|
|
(98,060 |
) |
Income from
operations |
|
|
56,273 |
|
|
|
181,056 |
|
|
|
139,196 |
|
|
|
(64,613 |
) |
|
|
64,669 |
|
|
|
|
|
|
|
|
|
|
|
|
Other income
(expenses): |
|
|
|
|
|
|
|
|
|
|
Interest
income and other financial gains |
|
|
45,901 |
|
|
|
35,442 |
|
|
|
20,561 |
|
|
|
8,881 |
|
|
|
10,250 |
|
Interest
expense and other financial losses |
|
|
(26,469 |
) |
|
|
(25,605 |
) |
|
|
(20,391 |
) |
|
|
(6,783 |
) |
|
|
(6,799 |
) |
Foreign
currency (losses) gains |
|
|
(21,635 |
) |
|
|
(5,565 |
) |
|
|
11,125 |
|
|
|
(2,157 |
) |
|
|
(501 |
) |
Net income before
income tax expense |
|
|
54,070 |
|
|
|
185,328 |
|
|
|
150,491 |
|
|
|
(64,672 |
) |
|
|
67,619 |
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense |
|
|
(40,290 |
) |
|
|
(48,962 |
) |
|
|
(44,702 |
) |
|
|
(3,048 |
) |
|
|
(16,272 |
) |
|
|
|
|
|
|
|
|
|
|
|
Net income attributable
to MercadoLibre, Inc. shareholders |
|
$ |
13,780 |
|
|
$ |
136,366 |
|
|
$ |
105,789 |
|
|
$ |
(67,720 |
) |
|
$ |
51,347 |
|
|
Year Ended December 31, |
|
|
Three Months Ended December 31, |
|
|
2017 |
|
|
2016 |
|
|
2015 |
|
|
|
2017 |
|
|
|
2016 |
|
Basic
EPS |
|
|
|
|
|
|
|
|
|
|
|
Basic net
income |
|
|
|
|
|
|
|
|
|
|
|
Available
to shareholders per common share |
$ |
0.31 |
|
$ |
3.09 |
|
$ |
2.40 |
|
|
$ |
(1.53 |
) |
|
$ |
1.16 |
|
Weighted
average of outstanding common shares |
|
44,157,364 |
|
|
44,157,251 |
|
|
44,155,680 |
|
|
|
44,157,364 |
|
|
|
44,157,355 |
|
Diluted
EPS |
|
|
|
|
|
|
|
|
|
|
|
Diluted
net income |
|
|
|
|
|
|
|
|
|
|
|
Available
to shareholders per common share |
$ |
0.31 |
|
$ |
3.09 |
|
$ |
2.40 |
|
|
$ |
(1.53 |
) |
|
$ |
1.16 |
|
Weighted
average of outstanding common shares |
|
44,157,364 |
|
|
44,157,251 |
|
|
44,155,680 |
|
|
|
44,157,364 |
|
|
|
44,157,355 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Dividends
declared (per share) |
|
0.600 |
|
|
0.600 |
|
|
0.412 |
|
|
|
0.150 |
|
|
|
0.150 |
|
Financial results of reporting segments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31, 2017 |
|
|
Brazil |
|
Argentina |
|
Mexico |
|
Venezuela (*) |
|
Other Countries |
|
Total |
|
|
(In thousands) |
Net revenues |
|
$ |
831,416 |
|
|
$ |
359,357 |
|
|
$ |
86,486 |
|
|
$ |
54,327 |
|
|
$ |
66,509 |
|
|
$ |
1,398,095 |
|
Direct costs |
|
|
(612,196 |
) |
|
|
(215,831 |
) |
|
|
(142,559 |
) |
|
|
(22,101 |
) |
|
|
(58,995 |
) |
|
|
(1,051,682 |
) |
Impairment of
Long-lived Assets |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(2,837 |
) |
|
|
- |
|
|
|
(2,837 |
) |
Loss on deconsolidation
of Venezuelan subsidiary |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(76,617 |
) |
|
|
- |
|
|
|
(76,617 |
) |
Direct
contribution |
|
|
219,220 |
|
|
|
143,526 |
|
|
|
(56,073 |
) |
|
|
(47,228 |
) |
|
|
7,514 |
|
|
|
266,959 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses and
indirect costs of net revenues |
|
|
|
|
|
|
|
|
|
|
|
|
(201,542 |
) |
Loss on Deconsolidation
of Venezuelan's Intercompany balances |
|
|
|
|
|
|
|
|
|
|
|
|
(9,144 |
) |
Income from
operations |
|
|
|
|
|
|
|
|
|
|
|
|
56,273 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income
(expenses): |
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income and other financial gains |
|
|
|
|
|
|
|
|
|
|
|
|
45,901 |
|
Interest
expense and other financial losses |
|
|
|
|
|
|
|
|
|
|
|
|
(26,469 |
) |
Foreign
currency losses |
|
|
|
|
|
|
|
|
|
|
|
|
(21,635 |
) |
Net income before
income tax expense |
|
|
|
|
|
|
|
|
|
|
|
$ |
54,070 |
|
|
|
|
|
|
|
|
|
Three months Ended December 31,
2017 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Brazil |
|
Argentina |
|
Mexico |
|
Venezuela(*) |
|
Other Countries |
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
revenues |
|
$ |
262,096 |
|
|
$ |
108,666 |
|
|
$ |
28,162 |
|
|
$ |
15,999 |
|
|
$ |
22,056 |
|
|
|
436,979 |
|
Direct
costs |
|
|
|
|
(222,188 |
) |
|
|
(64,858 |
) |
|
|
(46,879 |
) |
|
|
(5,260 |
) |
|
|
(21,940 |
) |
|
|
(361,125 |
) |
Loss on
Deconsolidation of Venezuelan Subsidiaries |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(76,617 |
) |
|
|
- |
|
|
|
(76,617 |
) |
Direct
contribution |
|
|
39,908 |
|
|
|
43,808 |
|
|
|
(18,717 |
) |
|
|
(65,878 |
) |
|
|
116 |
|
|
|
(763 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses and indirect costs of net revenues |
|
|
|
|
|
|
|
|
|
|
|
|
(54,701 |
) |
Loss on
Deconsolidation of Venezuelan's Intercompany balances |
|
|
|
|
|
|
|
|
|
|
(9,143 |
) |
Income from
operations |
|
|
|
|
|
|
|
|
|
|
|
|
(64,607 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
income (expenses): |
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income and other financial gains |
|
|
|
|
|
|
|
|
|
|
|
|
8,881 |
|
|
Interest
expense and other financial results |
|
|
|
|
|
|
|
|
|
|
|
|
(6,783 |
) |
|
Foreing
currency losses |
|
|
|
|
|
|
|
|
|
|
|
|
(2,160 |
) |
Net Income
before Income Tax |
|
|
|
|
|
|
|
|
|
|
|
|
(64,669 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income
Tax |
|
|
|
|
|
|
|
|
|
|
|
|
|
(3,049 |
) |
Net
Income |
|
|
|
|
|
|
|
|
|
|
|
|
$ |
(67,718 |
) |
(*)Excludes results of operations for Venezuela for the month of
December 2017.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31, 2016 |
|
|
Brazil |
|
Argentina |
|
Mexico |
|
Venezuela |
|
Other Countries |
|
Total |
|
|
(In thousands) |
Net revenues |
|
$ |
455,024 |
|
|
$ |
262,252 |
|
|
$ |
46,332 |
|
|
$ |
37,185 |
|
|
$ |
43,603 |
|
|
$ |
844,396 |
|
Direct costs |
|
|
(270,922 |
) |
|
|
(152,103 |
) |
|
|
(40,951 |
) |
|
|
(17,732 |
) |
|
|
(31,549 |
) |
|
$ |
(513,257 |
) |
Impairment of
Long-lived Assets |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(13,717 |
) |
|
|
- |
|
|
$ |
(13,717 |
) |
Direct
contribution |
|
|
184,102 |
|
|
|
110,149 |
|
|
|
5,381 |
|
|
|
5,736 |
|
|
|
12,054 |
|
|
|
317,422 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses and
indirect costs of net revenues |
|
|
|
|
|
|
|
|
|
|
|
|
(136,366 |
) |
Income from
operations |
|
|
|
|
|
|
|
|
|
|
|
|
181,056 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income
(expenses): |
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income and other financial gains |
|
|
|
|
|
|
|
|
|
|
|
|
35,442 |
|
Interest
expense and other financial losses |
|
|
|
|
|
|
|
|
|
|
|
|
(25,605 |
) |
Foreign
currency losses |
|
|
|
|
|
|
|
|
|
|
|
|
(5,565 |
) |
Net income before
income tax expense |
|
|
|
|
|
|
|
|
|
|
|
$ |
185,328 |
|
|
|
Three Months Ended December 31,
2016 |
|
|
|
|
Brazil |
|
Argentina |
|
Mexico |
|
Venezuela |
|
Other Countries |
|
Total |
|
|
|
(In thousands) |
|
Net revenues |
|
$ |
143,597 |
|
|
$ |
76,367 |
|
|
$ |
11,957 |
|
|
$ |
10,734 |
|
|
$ |
13,620 |
|
|
$ |
256,275 |
|
|
Direct costs |
|
|
(82,150 |
) |
|
|
(46,886 |
) |
|
|
(11,947 |
) |
|
|
(5,041 |
) |
|
|
(10,268 |
) |
|
$ |
(156,292 |
) |
|
Direct
contribution |
|
|
61,447 |
|
|
|
29,481 |
|
|
|
10 |
|
|
|
5,693 |
|
|
|
3,352 |
|
|
|
99,983 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses and
indirect costs of net revenues |
|
|
|
|
|
|
|
|
|
|
|
|
(35,311 |
) |
|
Income from
operations |
|
|
|
|
|
|
|
|
|
|
|
|
64,672 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income
(expenses): |
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income and other financial gains |
|
|
|
|
|
|
|
|
|
|
|
|
10,250 |
|
|
Interest
expense and other financial results |
|
|
|
|
|
|
|
|
|
|
|
|
(6,798 |
) |
|
Foreing
currency losses |
|
|
|
|
|
|
|
|
|
|
|
|
(503 |
) |
|
Net income tax |
|
|
|
|
|
|
|
|
|
|
|
$ |
67,621 |
|
|
Non-GAAP Financial Measures
To supplement our consolidated financial
statements presented in accordance with U.S. GAAP, we use foreign
exchange (“FX”) neutral measures as non-GAAP measures.
These non-GAAP measures should not be considered
in isolation or as a substitute for measures of performance
prepared in accordance with U.S. GAAP and may be different from
non-GAAP measures used by other companies. In addition, these
non-GAAP measures are not based on any comprehensive set of
accounting rules or principles. Non-GAAP measures have limitations
in that they do not reflect all of the amounts associated with our
results of operations as determined in accordance with U.S. GAAP.
These non-GAAP measures should only be used to evaluate our results
of operations in conjunction with the most comparable U.S. GAAP
financial measures.
Reconciliation of these non-GAAP measures to the
most comparable U.S. GAAP financial measures can be found in the
tables included in our annual report.
Non-GAAP financial measures are provided to
enhance investors’ overall understanding of our current financial
performance. Specifically, we believe that reconciliation of FX
neutral measures to the most directly comparable GAAP measures
provides investors an overall understanding of our current
financial performance and its prospects for the future.
Specifically, we believe these non-GAAP measures provide useful
information to both management and investors by excluding the
foreign currency exchange rate impact that may not be indicative of
our core operating results and business outlook.
The FX neutral measures were calculated by using
the average monthly exchange rates for each month during 2016 and
applying them to the corresponding months in 2017, so as to
calculate what our results would have been had exchange rates
remained stable from one year to the next. The table below excludes
intercompany allocation FX effects. Finally, these measures do not
include any other macroeconomic effect such as local currency
inflation effects, the impact on impairment calculations or any
price adjustment to compensate local currency inflation or
devaluations.
The following table sets forth the FX neutral measures related
to our reported results of the operations for the three months
ended December 31, 2017 and 2016:
|
|
Three-months Periods Ended
December 31, (*) |
|
|
As reported |
|
FX Neutral Measures |
(In millions, except percentages) |
|
|
2017 |
|
|
|
2016 |
|
|
Percentage Change |
|
|
2017 |
|
|
|
2016 |
|
|
Percentage Change |
|
|
|
|
|
|
|
|
|
Net revenues |
|
$ |
437.0 |
|
|
$ |
256.3 |
|
|
70.5 |
% |
|
$ |
511.6 |
|
|
$ |
256.3 |
|
|
99.6 |
% |
Cost of net
revenues |
|
|
(233.6 |
) |
|
|
(93.5 |
) |
|
149.7 |
% |
|
|
(245.7 |
) |
|
|
(93.5 |
) |
|
162.7 |
% |
Gross profit |
|
|
203.4 |
|
|
|
162.7 |
|
|
25.0 |
% |
|
|
265.9 |
|
|
|
162.7 |
|
|
63.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses |
|
|
(182.2 |
) |
|
|
(98.1 |
) |
|
85.8 |
% |
|
|
(198.1 |
) |
|
|
(98.1 |
) |
|
102.0 |
% |
Loss on
Desconsolidation of Venezuelan Subsidiaries |
|
(85.8 |
) |
|
|
— |
|
|
100.0 |
% |
|
|
(85.8 |
) |
|
|
— |
|
|
100.0 |
% |
Total operating
expenses |
|
|
(268.0 |
) |
|
|
(98.1 |
) |
|
173.3 |
% |
|
|
(283.9 |
) |
|
|
(98.1 |
) |
|
189.5 |
% |
Income from
operations |
|
|
(64.6 |
) |
|
|
64.7 |
|
|
-199.9 |
% |
|
|
(18.0 |
) |
|
|
64.7 |
|
|
-127.8 |
% |
(*) The table above may not total due to
rounding,
CONTACT: MercadoLibre, Inc,Investor
Relationsinvestor@mercadolibre.comhttp://investor.mercadolibre.com
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