BEIJING, June 24, 2019 /PRNewswire/ -- LightInTheBox
Holding Co., Ltd. (NYSE: LITB) ("LightInTheBox" or the "Company"),
a cross-border e-commerce platform that delivers products directly
to consumers around the world, today announced its unaudited
financial results for the first quarter ended March 31, 2019.
First Quarter 2019 Highlights
- Gross margin improved to 34.8% from 29.2% in the same quarter
of 2018.
- Net loss was $14.1 million,
compared with a net loss of $7.9
million in the same quarter of 2018. The net loss includes
the impact from a $5.3 million net
loss due to the change in fair value of the convertible promissory
notes associated with the acquisition of Ezbuy. Adjusted
EBITDA[1] was
$7.9 million, compared with
$7.4 million in the same quarter of
2018.
- Selling and marketing expenses as a percentage of total revenue
decreased to 18.3% from 23.0% in the same quarter of 2018.
Mr. Jian He, Chief Executive
Officer of LightInTheBox, commented, "The initiatives we
implemented last quarter to stabilize and turn our business around
continue to generate solid results and have strengthened our
confidence going forward. While net revenues decreased 27.4%
year-over-year to $50.9 million, our
gross margin held steady at 34.8%, a significant improvement from
29.2% during the same period last year and essentially flat
sequentially. The integration of operations between Ezbuy and
LightInTheBox is creating new synergies that are optimizing
operational efficiency and increasing our repeat purchase rate.
Sales and marketing expenses as a percentage of revenue also
continues to trend downwards, falling to 18.3%.
Adjusted EBITDA was $7.9 million
in the first quarter of 2019, almost flat when compared with the
same period last year which I believe is more indicative of the
progress we have made in turning the business around."
First Quarter 2019 Financial Results
Total revenues decreased by 27.4% year-over-year to
$50.9 million from $70.1 million in the same quarter of 2018.
Revenues from product sales were $49.8
million, compared with $66.0
million in the same quarter of 2018. Revenues from service
and others were $1.1 million,
compared with $4.1 million in the same quarter of 2018. As a
percentage of total revenues, service and others accounted for 2.2%
in the first quarter of 2019.
The number of orders for product sales was 2.6 million in the
first quarter of 2019, compared with 1.3 million in the same
quarter of 2018. The number of customers for product sales was 0.6
million for the first quarter of 2019, compared with 1.0 million in
the same quarter of 2018.
Product sales from the apparel category were $14.4 million in the first quarter of 2019,
compared with $19.9 million in the
same quarter of 2018. As a percentage of product sales, apparel
revenues accounted for 28.9% in the first quarter of 2019, compared
with 30.2% in the same quarter of 2018. Product sales from other
general merchandise were $35.4
million in the first quarter of 2019.
Total cost of revenues was $33.2
million in the first quarter of 2019, compared with $49.6 million in the same quarter of 2018. Cost
for product sales was $32.8 million
in the first quarter of 2019, compared with $45.9 million in the same quarter of 2018. Cost
for service and others was $0.4
million in the first quarter of 2019, compared with
$3.7 million in the same quarter of
2018.
Gross profit in the first quarter of 2019 was
$17.7 million, compared with
$20.5 million in the same quarter of
2018. Gross margin was 34.8% in the first quarter of 2019, compared
with 29.2% in the same quarter of 2018.
Total operating expenses in the first quarter of 2019
were $26.5 million, compared with
$28.6 million in the same quarter of
2018.
- Fulfillment expenses in the first quarter of 2019 were
$5.2 million, compared with
$4.5 million in the same quarter of
2018. As a percentage of total revenues, fulfillment expenses was
10.2% in the first quarter of 2019, compared to 6.4% in the same
quarter of 2018 and 6.2% in the fourth quarter of 2018.
- Selling and marketing expenses in the first quarter of
2019 were $9.3 million, compared with
$16.1 million in the same quarter of
2018. As a percentage of total revenues, selling and marketing
expenses was 18.3% for the first quarter of 2019, compared to 23.0%
in the same quarter of 2018 and 20.5% in the fourth quarter of
2018.
- General and administrative (G&A) expenses in the
first quarter of 2019 were $12.0
million, compared with $8.0
million in the same quarter of 2018. As a percentage of
total revenues, G&A expenses was 23.6% for the first quarter of
2019, compared with 11.4% in the same quarter of 2018 and 10.8% in
the fourth quarter of 2018. G&A expenses in the first quarter
of 2019 included $4.2 million in
technology investments, compared with $3.0
million in the same quarter of 2018.
Loss from operations was $8.8
million in the first quarter of 2019, compared with a loss
from operations of $8.1 million in
the same quarter of 2018.
Net loss was $14.1 million
in the first quarter of 2019, compared with a net loss of
$7.9 million in the same quarter of
2018. The increase in net loss was mainly due to the change in fair
value of convertible promissory notes issued on December 10, 2018 for acquiring total issued
share capital of Ezbuy Holding Co., Ltd. ("Ezbuy"). The net loss
due to the change in fair value of the convertible promissory notes
in the first quarter of 2019 was $5.3
million.
Net loss per American Depository Share ("ADS") was
$0.21 in the first quarter of 2019,
compared with net loss per ADS of $0.12 in the same quarter of 2018. Each ADS
represents two ordinary shares.
In the first quarter of 2019, the Company's weighted average
number of ADSs used in computing the loss per ADS was
67,229,085.
Adjusted EBITDA, which
represents loss from operations before share-based compensation
expense, change in fair value of convertible promissory notes,
interest income, interest expense, income tax expense and
depreciation and amortization, expenses, was $7.9 million in the first quarter of 2019,
compared with $7.4 million in the
same quarter of 2018.
As of March 31, 2019, the Company
had cash and cash equivalents and restricted cash of $30.3 million, compared with $39.8 million as of December 31, 2018.
Business outlook
For the second quarter of 2019, based on current information
available to the Company and business seasonality, the Company
expects net revenues to be between $57
million and $60 million.
Change in Fair Value of Convertible Promissory Notes
Associated with the Acquisition of Ezbuy
The Company entered into a Share Purchase Agreement ("SPA") on
November 8, 2018 to acquire Ezbuy in
the form of non-interest bearing one-year convertible promissory
notes. This SPA took effect on December 10,
2018 when LITB's closing stock price was $0.64. LITB's closing stock price on December 31, 2018 and March 31, 2019 was $1.22 and $1.35
respectively. The Company adopted Monte-Carlo Simulation based on a
scenario-weighted average method to estimate the fair value of the
convertible promissory notes. The estimate is based on the
probability of each scenario and pay-off of the convertible
promissory notes under each scenario. The scenarios include
different timing and corresponding conversion price of the
convertible promissory notes. The key assumptions adopted in the
convertible promissory notes valuation include risk-free rate of
interest and expected stock price volatility in the conversion
period. The Company recorded a non-cash loss arising from change in
fair value of the convertible promissory notes of $5.3 million in the first quarter of 2019.
Non-GAAP Financial Measures
To supplement our consolidated financial statements, which are
prepared and presented in accordance with U.S. GAAP, we use the
following non-GAAP financial measures to help evaluate our
operating performance:
"Adjusted EBITDA" represents loss from operations before
share-based compensation expense,
change in fair value of convertible promissory notes, interest
income, interest expense, income tax expense and depreciation and
amortization expenses. Although other companies may calculate
adjusted EBITDA differently or not present it at all, we believe
that the adjusted EBITDA helps to identify underlying trends in our
operating results, enhancing their understanding of the past
performance and future prospects.
Conference Call
The Company will hold a conference call at 8:00 a.m. Eastern Time on June 24, 2019 to discuss its financial results
and operating performance for the first quarter 2019. To
participate in the call, please dial the following numbers:
US Toll
Free:
|
1-866-519-4004
|
Hong Kong Toll
Free:
|
800-906-601
|
China:
|
400-620-8038
|
International:
|
+65-6713-5090
|
Passcode:
|
6196338
|
A telephone replay will be available two hours after the
conclusion of the conference call through June 30, 2019. The dial-in details are:
US:
|
+1-646-254-3697
|
Hong Kong:
|
+852-3051-2780
|
International:
|
+61-2-8199-0299
|
Passcode:
|
6196338
|
A live and archived webcast of the conference call will be
available on the Investor Relations section of LightInTheBox's
website at http://ir.lightinthebox.com.
[1] For a
discussion of the use of non-GAAP financial measures, see "Non-GAAP
Financial Measures."
|
About LightInTheBox Holding Co., Ltd.
LightInTheBox is a cross-border e-commerce platform that
delivers products directly to consumers around the world. The
Company offers customers a convenient way to shop for a wide
selection of products at attractive prices through its
www.lightinthebox.com, www.miniinthebox.com, www.ezbuy.com and
other websites and mobile applications, which are available in 23
major languages and cover more than 100 countries.
For more information, please visit www.lightinthebox.com.
Investor Relations Contact
Christensen
Ms. Xiaoyan Su
Tel: +86 (10) 5900 3429
Email: ir@lightinthebox.com
OR
Christensen
Ms. Linda Bergkamp
Phone: +1-480-614-3004
Email: lbergkamp@ChristensenIR.com
Forward-Looking Statements
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," "potential," "continue," "ongoing,"
"targets" and similar statements. Among other things, statements
that are not historical facts, including statements about
LightInTheBox's beliefs and expectations, the business outlook and
quotations from management in this announcement, as well as
LightInTheBox's strategic and operational plans, are or contain
forward-looking statements.
LightInTheBox may also make written or oral forward-looking
statements in its periodic reports to the U.S. Securities and
Exchange Commission (the "SEC"), in press releases and other
written materials and in oral statements made by its officers,
directors or employees to third parties. 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: LightInTheBox's goals and strategies; LightInTheBox's
future business development, results of operations and financial
condition; the expected growth of the global online retail market;
LightInTheBox's ability to attract customers and further enhance
customer experience and product offerings; LightInTheBox's ability
to strengthen its supply chain efficiency and optimize its
logistics network; LightInTheBox's expectations regarding demand
for and market acceptance of its products; competition;
fluctuations in general economic and business conditions and
assumptions underlying or related to any of the foregoing. Further
information regarding these and other risks is included in
LightInTheBox's filings with the SEC. All information provided in
this press release and in the attachments is as of the date of this
press release, and LightInTheBox does not undertake any obligation
to update any forward-looking statement, except as required under
applicable law.
LightInTheBox
Holding Co., Ltd.
|
Unaudited
Condensed Consolidated Balance Sheets
|
(U.S. dollars in
thousands, or otherwise noted)
|
|
|
|
|
|
|
|
As of December 31,
|
|
As of March 31,
|
|
|
2018
|
|
2019
|
ASSETS
|
|
|
|
|
Current
Assets
|
|
|
|
|
Cash and cash
equivalents
|
|
38,808
|
|
29,525
|
Restricted
cash
|
|
994
|
|
802
|
Accounts receivable,
net of allowance for doubtful
accounts
|
|
1,463
|
|
1,566
|
Inventories
|
|
8,481
|
|
8,209
|
Prepaid expenses and
other current assets
|
|
5,811
|
|
4,388
|
Total current
assets
|
|
55,557
|
|
44,490
|
Property and
equipment, net
|
|
3,652
|
|
3,431
|
Intangible assets,
net
|
|
9,890
|
|
9,572
|
Goodwill
|
|
28,169
|
|
28,169
|
Operating lease
right-of-use assets, net
|
|
-
|
|
7,376
|
Long-term rental
deposits
|
|
1,131
|
|
910
|
Long-term
investments
|
|
5,188
|
|
5,443
|
TOTAL
ASSETS
|
|
103,587
|
|
99,391
|
|
|
|
|
|
LIABILITIES AND
DEFICIT
|
|
|
|
|
Current
Liabilities
|
|
|
|
|
Accounts
payable
|
|
12,941
|
|
10,674
|
Amounts due to
related parties
|
|
4,953
|
|
5,707
|
Convertible
promissory notes
|
|
51,922
|
|
57,259
|
Advance from
customers
|
|
17,732
|
|
19,675
|
Current operating
lease liabilities
|
|
-
|
|
3,916
|
Accrued expenses and
other current liabilities
|
|
22,688
|
|
19,950
|
Total current
liabilities
|
|
110,236
|
|
117,181
|
|
|
|
|
|
Non-current operating
lease liabilities
|
|
-
|
|
3,647
|
Non-current finance
lease liabilities
|
|
1,156
|
|
1,073
|
TOTAL
LIABILITIES
|
|
111,392
|
|
121,901
|
|
|
|
|
|
DEFICIT
|
|
|
|
|
Ordinary
shares
|
|
11
|
|
11
|
Additional paid-in
capital
|
|
239,269
|
|
239,426
|
Treasury shares, at
cost
|
|
(27,261)
|
|
(27,261)
|
Accumulated other
comprehensive loss
|
|
(932)
|
|
(1,684)
|
Accumulated
deficit
|
|
(218,887)
|
|
(233,029)
|
Non-controlling
interests
|
|
(5)
|
|
27
|
TOTAL
DEFICIT
|
|
(7,805)
|
|
(22,510)
|
TOTAL LIABILITIES AND
DEFICIT
|
|
103,587
|
|
99,391
|
|
|
|
|
|
|
|
|
|
|
LightInTheBox
Holding Co., Ltd.
|
Unaudited
Condensed Consolidated Statements of Operations
|
(U.S. dollars in
thousands, except per share data, or otherwise
noted)
|
|
|
|
|
|
|
|
|
Three-month Period Ended
|
|
|
|
March
31,
|
|
March
31,
|
|
2018
|
|
2019
|
Revenues
|
|
|
|
|
|
Product
sales
|
|
65,968
|
|
49,789
|
|
Services and
others
|
|
4,086
|
|
1,084
|
|
Total
revenues
|
|
70,054
|
|
50,873
|
|
Cost of
revenues
|
|
|
|
|
|
Product
sales
|
|
(45,890)
|
|
(32,785)
|
|
Services and
others
|
|
(3,678)
|
|
(357)
|
|
Total Cost of
revenues
|
|
(49,568)
|
|
(33,142)
|
|
Gross
profit
|
|
20,486
|
|
17,731
|
|
Operating
expenses
|
|
|
|
|
|
Fulfillment
|
|
(4,480)
|
|
(5,265)
|
|
Selling and
marketing
|
|
(16,078)
|
|
(9,269)
|
|
General and
administrative
|
|
(7,999)
|
|
(11,984)
|
|
Total operating
expenses
|
|
(28,557)
|
|
(26,518)
|
|
Loss from
operations
|
|
(8,071)
|
|
(8,787)
|
|
Exchange loss on
offshore bank accounts
|
|
(57)
|
|
-
|
|
Interest
income
|
|
218
|
|
123
|
|
Interest
expense
|
|
-
|
|
(20)
|
|
Change in fair value
of convertible promissory notes
|
|
-
|
|
(5,337)
|
|
Total other income /
(loss)
|
|
161
|
|
(5,234)
|
|
Loss before income
taxes and gain from equity method investment
|
|
(7,910)
|
|
(14,021)
|
|
Income tax
expense
|
|
(2)
|
|
(216)
|
|
Gain from equity
method investment
|
|
59
|
|
127
|
|
Net
loss
|
|
(7,853)
|
|
(14,110)
|
|
Less: Net income
attributable to non-controlling interests
|
|
-
|
|
32
|
|
Net loss attributable
to LightInTheBox Holding Co., Ltd.
|
|
(7,853)
|
|
(14,142)
|
|
|
|
|
|
|
|
Weighted average
numbers of shares used in calculating loss per ordinary
share
|
|
|
|
|
|
—Basic
|
|
134,200,859
|
|
134,458,170
|
|
—Diluted
|
|
134,200,859
|
|
134,458,170
|
|
|
|
|
|
|
|
Net loss per ordinary
share
|
|
|
|
|
|
—Basic
|
|
(0.06)
|
|
(0.10)
|
|
—Diluted
|
|
(0.06)
|
|
(0.10)
|
|
|
|
|
|
|
|
Net loss per ADS (2
ordinary shares equal to 1 ADS)
|
|
|
|
|
|
—Basic
|
|
(0.12)
|
|
(0.21)
|
|
—Diluted
|
|
(0.12)
|
|
(0.21)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LightInTheBox
Holding Co., Ltd.
|
Unaudited
Reconciliations of GAAP and Non-GAAP Results
|
(U.S. dollars in
thousands, or otherwise noted)
|
|
|
|
|
|
|
|
|
Three-month Period Ended
|
|
|
|
March
31,
|
|
March
31,
|
|
2018
|
|
2019
|
|
|
|
|
|
|
Net
loss
|
|
(7,853)
|
|
(14,110)
|
|
|
|
|
|
|
|
Less: Interest
income
|
|
218
|
|
123
|
|
Interest expense
|
|
-
|
|
(20)
|
|
Income tax expense
|
|
(2)
|
|
(216)
|
|
Depreciation and amortization
|
|
(152)
|
|
(628)
|
|
EBITDA
|
|
(7,917)
|
|
(13,369)
|
|
|
|
|
|
|
|
Less: Share-based
compensation
|
|
(505)
|
|
(157)
|
|
Change in fair value of convertible promissory notes
|
|
-
|
|
(5,337)
|
|
Adjusted
EBITDA*
|
|
(7,412)
|
|
(7,875)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* Adjusted EBITDA represents
loss from operations before share-based compensation expense,
change in fair value of convertible promissory notes, interest
income, interest expense, income tax
expense and depreciation and amortization
expenses.
|
|
|
|
|
|
|
|
|
|
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SOURCE LightInTheBox Holding Co., Ltd.