BEIJING, June 19, 2018 /PRNewswire/ -- Renren Inc.
(NYSE: RENN) ("Renren" or the "Company"), which operates a social
networking service (SNS) business, used auto business and SaaS
business, today announced its unaudited financial results for the
first quarter ended March 31,
2018.
First Quarter 2018 Highlights
- Total net revenues were US$140.5
million, a 570% increase from the corresponding
period in 2017.
-- Internet Value-Added
Services (IVAS) and others net revenues were US$14.7 million, a 26.5% increase from the
corresponding period in 2017.
-- Financing income was US$2.2
million, a 76.4% decrease from the corresponding period in
2017.
-- Used car sales revenue was US$123.6 million. We initiated used car sales
business through one of our subsidiaries in the second quarter of
2017. As of March 31, 2018, we had a
presence in 14 cities in China for
this business.
- Gross profit was US$11.9
million, an 85.0% increase from the corresponding period in
2017.
- Operating loss was US$25.5
million, compared to an operating loss of US$17.6million in the corresponding period in
2017.
- Net loss attributable to the Company was US$41.6 million, compared to a net loss of
US$16.2 million in the corresponding
period in 2017.
- Adjusted loss from
operations (1) (non-GAAP) was US$13.1 million, compared with an adjusted loss
from operations of US$12.5 million in
the corresponding period in 2017 and an adjusted loss from
operations of US$21.9 million in the
fourth quarter of 2017.
- Adjusted net
loss (1) (non-GAAP) was US$18.8 million, compared to an adjusted net loss
of US$11.0 million in the
corresponding period in 2017.
(1)
Adjusted loss from operations and net loss are non-GAAP measures,
which are defined as loss from operations excluding share-based
compensation expenses and amortization of intangible assets and net
loss excluding share-based compensation expenses, fair value change
of contingent consideration and amortization of intangible assets,
respectively. See "About Non-GAAP Financial Measures"
below.
|
First Quarter 2018 Results
Total net revenues for the first quarter of 2018 were
US$140.5 million, representing a 570%
increase from the corresponding period in 2017, due to the launch
of the used car retail business in the second quarter of 2017.
IVAS and others net revenues were US$14.7 million, representing a 26.5% increase
from the corresponding period of 2017. The increase was mainly due
to the revenue from our Renren mobile live streaming service.
Monthly unique log-in users of the Renren SNS platform were
approximately 31 million in March
2018.
Financing income was US$2.2
million for the first quarter of 2018, compared to
US$9.3 million in the corresponding
period of 2017. The decrease was in line with the decrease of
financing receivable from US$270.1
million as of March 31, 2017
to US$46.0 million as of March 31 2018.
Used car sales revenue of US$123.6
million was generated through one of our subsidiaries
conducting used car sales business, which is a new business that we
initiated in the second quarter of 2017.
Cost of revenues was US$128.6
million, compared to US$14.5
million from the corresponding period of 2017. The increase
was primarily due to the cost of used car sales.
Operating expenses were US$37.4
million, a 55.7% increase from the corresponding period of
2017.
Selling and marketing expenses were US$11.9 million, a 92.9% increase from the
corresponding period of 2017. The increase was primarily due to the
increase in in headcount and personnel related expenses for the
used car sales business.
Research and development expenses were US$7.3 million, a 26.9% increase from the
corresponding period in 2017. The increase was primarily due to the
increase in headcount and personnel related expenses.
General and administrative expenses were US$18.2 million, a 50.6% increase from the
corresponding period in 2017. The increase was primarily due to the
increase in share-based compensation expenses.
Share-based compensation expenses, which were all
included in operating expenses, were US$12.3
million, compared to US$5.1
million in the corresponding period in 2017. The increase
was primarily due to stock options granted during the first quarter
of 2018 by our subsidiary conducting our used car business.
Loss from operations was US$25.5
million, compared to a loss from operations of US$17.6 million in the corresponding period in
2017.
Loss in equity method investments was US$2.8 million, compared to income of
US$4.1 million in the corresponding
period in 2017.
Net loss attributable to the Company was US$41.6 million, compared to a net loss of
US$16.2 million in the corresponding
period in 2017.
Adjusted loss from operations (non-GAAP) was US$13.1 million, compared with an adjusted loss
from operations of US$12.5 million in
the corresponding period in 2017 and an adjusted loss from
operations of US$21.9 million in the
fourth quarter of 2017. Adjusted loss from operations is defined as
loss from operations excluding share-based compensation expenses
and amortization of intangible assets.
Adjusted net loss (non-GAAP) was US$18.8 million, compared to an adjusted net loss
of US$11.0 million in the
corresponding period in 2017. Adjusted net loss is defined as net
loss excluding share-based compensation expenses, fair value change
of contingent consideration and amortization of intangible
assets.
Business Outlook
The Company expects to generate revenues in an amount ranging
from US$140 million to US$145 million in the second quarter of 2018,
representing a 527% to 549% year-over-year increase. This forecast
reflects Renren's current and preliminary view, which is subject to
change.
Potential Financial Impact on Renren of the Transaction
Announced on April 30, 2018
The Company has announced a series of transactions that include
a cash dividend by the Company and a private placement by its
subsidiary Oak Pacific Investment ("the Transaction") on
April 30, 2018. The Transaction is
intended to address concerns that Renren may be deemed to be an
investment company within the meaning of the Investment Company Act
and is expected to close on June 21,
2018. The Transaction will have a significant impact on the
Company's financial statements. Please refer to the Forms 6-K
filed with the SEC on June 19 and
May 14, 2018 for unaudited pro forma
condensed consolidated financial statements. Based on the unaudited
pro forma condensed consolidated balance sheet as though the
Transaction had occurred on March 31,
2018, total Renren Inc. shareholders' equity value following
the Transaction is currently estimated to be US$174 million.
Conference Call Information
The Company will not host a conference call. Please contact our
Investor Relations Department if you have any questions.
About Renren Inc.
Renren Inc. (NYSE: RENN) operates a social networking
service (SNS) business, used car business and SaaS business.
Renren's American depositary shares, each of which represents
fifteen Class A ordinary shares, trade on NYSE under the
symbol "RENN".
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
"will," "expects," "anticipates," "future," "intends," "plans,"
"believes," "estimates" and similar statements. Among other things,
the business outlook for the second quarter of 2018 and quotations
from management in this announcement, as well as Renren's strategic
and operational plans, contain forward-looking statements. Renren
may also make written or oral forward-looking statements in its
filings with the U.S. Securities and Exchange Commission ("SEC"),
in its annual report to shareholders, in press releases and other
written materials and in oral statements made by its officers,
directors or employees to third parties. Statements that are not
historical facts, including statements about Renren's beliefs and
expectations, are 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: our goals and strategies; our future
business development, financial condition and results of
operations; the expected growth of the social networking site
market in China; our expectations
regarding demand for and market acceptance of our services; our
expectations regarding the retention and strengthening of our
relationships with key advertisers and customers; our plans to
enhance user experience, infrastructure and service offerings;
competition in our industry in China; and relevant government policies and
regulations relating to our industry. Further information regarding
these and other risks is included in our annual report on
Form 20-F and other documents filed with the SEC. All
information provided in this press release and in the
attachments is as of the date of this press release, and Renren
does not undertake any obligation to update
any forward-looking statement, except as required under
applicable law.
About Non-GAAP Financial Measures
To supplement Renren's consolidated financial results presented
in accordance with United States Generally Accepted Accounting
Principles ("GAAP"), Renren uses "adjusted loss from operations and
net loss" which are defined as "non-GAAP financial measures" by the
SEC, in evaluating its business. We define adjusted loss from
operations as loss from operations excluding share-based
compensation expenses and amortization of intangible assets and
adjusted net loss as net loss excluding share-based compensation
expenses, fair value change of contingent consideration and
amortization of intangible assets, respectively. Renren
continuously and periodically reviews the operating results and
business performance from operational perspectives. Starting from
the first quarter of 2018, there was a significant impact on net
loss due to the material and significant noncash amount of fair value change of
contingent consideration relating to the used car dealership of the
emerging used auto business. Due to the nature of the business,
Renren believes that including adjusted loss from operations and
excluding the impact of such fair value changes more appropriately
reflects Renren's results of operations, and provides investors
with a better understanding of Renren's business performance. To
facilitate investors and analysts, we present the foresaid impact
in "Reconciliation of non-GAAP results of operations measures to
the comparable GAAP financial measures" retrospectively. We present
adjusted loss from operations and net loss because they are used by
our management to evaluate our operating performance. We also
believe that these non-GAAP financial measures provide useful
information to investors and others in understanding and evaluating
our consolidated results of operations in the same manner as our
management and in comparing financial results across accounting
periods and to those of our peer companies.
The presentation of these non-GAAP financial measures are not
intended to be considered in isolation from, or as a substitute
for, the financial information prepared and presented in accordance
with GAAP. For more information on these non-GAAP financial
measures, please see the table captioned "Reconciliation of
non-GAAP results of operations measures to the comparable GAAP
financial measures" at the end of this release.
For more information, please contact:
Investor Relations Department
Renren Inc.
Tel: (86 10) 8448 1818 ext. 1300
Email: ir@renren-inc.com
RENREN
INC.
|
UNAUDITED
CONDENSED CONSOLIDATED BALANCE SHEETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Amounts in US
dollars, in thousands, except shares,
|
|
|
December
31,
|
|
|
March
31,
|
per share, ADS, and
per ADS data)
|
|
|
2017
|
|
|
2018
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
128,595
|
|
$
|
128,956
|
Restricted
Cash
|
|
|
47,253
|
|
|
49,468
|
Accounts
receivable, net
|
|
|
6,260
|
|
|
2,199
|
Financing
receivable, net
|
|
|
125,478
|
|
|
45,957
|
Prepaid
expenses and other current assets
|
|
|
50,183
|
|
|
61,021
|
Amounts due
from related parties
|
|
|
15,224
|
|
|
16,807
|
Inventory
|
|
|
95,012
|
|
|
99,288
|
Total
current assets
|
|
|
468,005
|
|
|
403,696
|
|
|
|
|
|
|
|
Non-current
assets:
|
|
|
|
|
|
|
Long-term
financing receivable, net
|
|
|
8
|
|
|
4
|
Property and
equipment, net
|
|
|
29,532
|
|
|
30,789
|
Goodwill and
intangible assets, net
|
|
|
104,197
|
|
|
112,479
|
Long-term
investments
|
|
|
565,366
|
|
|
565,550
|
Other
non-current assets
|
|
|
27,056
|
|
|
28,142
|
Total
non-current assets
|
|
|
726,159
|
|
|
736,964
|
|
|
|
|
|
|
|
TOTAL
ASSETS
|
|
$
|
1,194,164
|
|
$
|
1,140,660
|
|
|
|
|
|
|
|
LIABILITIES
AND EQUITY
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
Accounts
payable
|
|
$
|
20,046
|
|
$
|
16,986
|
Short-term
debt
|
|
|
61,479
|
|
|
97,567
|
Accrued
expenses and other current liabilities
|
|
|
45,898
|
|
|
48,847
|
Payable to
investors
|
|
|
142,689
|
|
|
48,146
|
Amounts due to
related parties
|
|
|
17,746
|
|
|
15,153
|
Deferred
revenue and advance from customers
|
|
|
11,489
|
|
|
14,143
|
Income tax
payable
|
|
|
12,652
|
|
|
13,793
|
Contingent
consideration
|
|
|
5,944
|
|
|
7,121
|
Long-term debt
current
|
|
|
52,604
|
|
|
52,604
|
Total
current liabilities
|
|
|
370,547
|
|
|
314,360
|
|
|
|
|
|
|
|
Non-current
liabilities:
|
|
|
|
|
|
|
Long-term
debt
|
|
|
47,665
|
|
|
47,899
|
Long-term
Contingent consideration
|
|
|
60,850
|
|
|
74,398
|
Other
non-current liabilities
|
|
|
6,356
|
|
|
6,123
|
Total
non-current liabilities
|
|
|
114,871
|
|
|
128,420
|
|
|
|
|
|
|
|
TOTAL
LIABILITIES
|
|
$
|
485,418
|
|
$
|
442,780
|
|
|
|
|
|
|
|
Shareholders' Equity:
|
|
|
|
|
|
|
Class A
ordinary shares
|
|
|
727
|
|
|
729
|
Class B
ordinary shares
|
|
|
305
|
|
|
305
|
Additional
paid-in capital
|
|
|
1,303,117
|
|
|
1,322,077
|
Statutory
reserves
|
|
|
6,712
|
|
|
6,712
|
Accumulated
deficit
|
|
|
(653,173)
|
|
|
(694,723)
|
Accumulated
other comprehensive income
|
|
|
17,116
|
|
|
22,747
|
Total Renren
Inc. shareholders' equity
|
|
|
674,804
|
|
|
657,847
|
|
|
|
|
|
|
|
Noncontrolling
Interests
|
|
|
33,942
|
|
|
40,033
|
|
|
|
|
|
|
|
TOTAL
EQUITY
|
|
|
708,746
|
|
|
697,880
|
|
|
|
|
|
|
|
TOAL
LIABILITIES AND EQUITY
|
|
$
|
1,194,164
|
|
$
|
1,140,660
|
RENREN
INC.
|
UNAUDITED
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
|
|
For the Three
Months Ended
|
(Amounts in US
dollars, in thousands, except shares,
|
|
|
March
31,
|
|
|
December
31,
|
|
|
March
31,
|
per shares, ADS, and
per ADS data)
|
|
|
2017
|
|
|
2017
|
|
|
2018
|
|
|
|
|
|
|
|
|
|
|
Net
revenues
|
|
|
|
|
|
|
|
|
|
IVAS and
others
|
|
$
|
11,599
|
|
$
|
14,531
|
|
$
|
14,669
|
Financing
income
|
|
|
9,347
|
|
|
4,733
|
|
|
2,203
|
Used car
sales
|
|
|
-
|
|
|
77,797
|
|
|
123,606
|
Total net
revenues
|
|
|
20,946
|
|
|
97,061
|
|
|
140,478
|
|
|
|
|
|
|
|
|
|
|
Cost of
revenues
|
|
|
(14,499)
|
|
|
(96,878)
|
|
|
(128,550)
|
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
|
|
6,447
|
|
|
183
|
|
|
11,928
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
Selling and
marketing
|
|
|
(6,148)
|
|
|
(8,399)
|
|
|
(11,860)
|
Research and
development
|
|
|
(5,784)
|
|
|
(6,993)
|
|
|
(7,339)
|
General and
administrative
|
|
|
(12,112)
|
|
|
(12,233)
|
|
|
(18,240)
|
|
|
|
|
|
|
|
|
|
|
Total
operating expenses
|
|
|
(24,044)
|
|
|
(27,625)
|
|
|
(37,439)
|
|
|
|
|
|
|
|
|
|
|
Loss from
operations
|
|
|
(17,597)
|
|
|
(27,442)
|
|
|
(25,511)
|
|
|
|
|
|
|
|
|
|
|
Other
expenses
|
|
|
(6)
|
|
|
(5,997)
|
|
|
(10,443)
|
Interest
income
|
|
|
315
|
|
|
623
|
|
|
807
|
Interest
expenses
|
|
|
(2,305)
|
|
|
(2,760)
|
|
|
(2,819)
|
Realized gain
on short-term investments
|
|
|
100
|
|
|
-
|
|
|
-
|
Realized gain
on disposal of long-term investments
|
|
|
-
|
|
|
4,585
|
|
|
-
|
Impairment of
long term investments
|
|
|
-
|
|
|
(17,052)
|
|
|
-
|
Total
non-operating loss
|
|
|
(1,896)
|
|
|
(20,601)
|
|
|
(12,455)
|
|
|
|
|
|
|
|
|
|
|
Loss before
provision of income tax and income (loss) in
equity method investments, net of tax
|
|
|
(19,493)
|
|
|
(48,043)
|
|
|
(37,966)
|
Income tax
expenses
|
|
|
(780)
|
|
|
(1,936)
|
|
|
(831)
|
Loss before
income (loss) in equity method investments, net
of tax
|
|
|
(20,273)
|
|
|
(49,979)
|
|
|
(38,797)
|
Income (loss)
in equity method investments, net of tax
|
|
|
4,095
|
|
|
(4,211)
|
|
|
(2,773)
|
Net
loss
|
|
|
(16,178)
|
|
|
(54,190)
|
|
|
(41,570)
|
Net loss
(income) attributable to noncontrolling
interests
|
|
|
-
|
|
|
(99)
|
|
|
20
|
Net loss
attributable to Renren Inc.
|
|
$
|
(16,178)
|
|
$
|
(54,289)
|
|
$
|
(41,550)
|
|
|
|
|
|
|
|
|
|
|
Net loss per
share attributable to Renren Inc. shareholders:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
(0.02)
|
|
$
|
(0.05)
|
|
$
|
(0.04)
|
Diluted
|
|
$
|
(0.02)
|
|
$
|
(0.05)
|
|
$
|
(0.04)
|
Net loss
attributable to Renren Inc. shareholders per ADS*:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
(0.24)
|
|
$
|
(0.79)
|
|
$
|
(0.60)
|
Diluted
|
|
$
|
(0.24)
|
|
$
|
(0.79)
|
|
$
|
(0.60)
|
|
|
|
|
|
|
|
|
|
|
Weighted
average number of shares used in calculating net
loss per ordinary share attributable to Renren Inc.
shareholders:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
1,026,375,051
|
|
|
1,030,786,885
|
|
|
1,033,468,103
|
Diluted
|
|
|
1,026,375,051
|
|
|
1,030,786,885
|
|
|
1,033,468,103
|
|
|
|
|
|
|
|
|
|
|
* Each ADS
represents 15 Class A ordinary shares.
|
|
|
|
|
|
|
|
|
|
Reconciliation of Non-GAAP results of
operations measures to the comparable GAAP financial
measures
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
loss from operations and net loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the
Three Months Ended
|
(Amounts in US
dollars, in thousands)
|
|
|
|
March
31,
|
|
|
|
December
31,
|
|
|
March
31,
|
|
|
|
2017
|
|
|
|
2017
|
|
|
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from
opeartions
|
|
|
$
|
(17,597)
|
|
|
$
|
(27,442)
|
|
$
|
(25,511)
|
Add back:
Shared-based compensation expenses
|
|
|
|
5,143
|
|
|
|
5,494
|
|
|
12,327
|
Add back: Amortization of
intangible assets
|
|
|
|
-
|
|
|
|
35
|
|
|
131
|
Adjusted
loss from operations
|
|
|
$
|
(12,454)
|
|
|
$
|
(21,913)
|
|
$
|
(13,053)
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss
|
|
|
$
|
(16,178)
|
|
|
$
|
(54,289)
|
|
$
|
(41,550)
|
Add back:
Shared-based compensation expenses
|
|
|
|
5,143
|
|
|
|
5,494
|
|
|
12,327
|
Add back: Fair
value change of contingent consideration
|
|
|
|
-
|
|
|
|
2,601*
|
|
|
10,265
|
Add back: Amortization of
intangible assets
|
|
|
|
-
|
|
|
|
35
|
|
|
131
|
Adjusted net
loss
|
|
|
$
|
(11,035)
|
|
|
$
|
(46,159)
|
|
$
|
(18,827)
|
|
|
|
|
|
|
|
|
|
|
|
|
* We have retrospectively
presented adjusted net loss (non GAAP) for the three months ended
December 31, 2017, by adding back US$2.6 million of fair value
change of contingent consideration during that quarter. See "About
Non-GAAP Financial Measures".
|
View original
content:http://www.prnewswire.com/news-releases/renren-announces-unaudited-first-quarter-2018-financial-results-and-update-on-potential-financial-impact-of-the-transaction-announced-on-april-30-2018-300668479.html
SOURCE Renren Inc.