21Vianet Group, Inc. Reports First Quarter 2015 Unaudited Financial Results
1Q15 Net Revenues Up 46.8% YOY to
1Q15 Adjusted EBITDA Up 47.8% YOY to
Live Conference Call to be Held at
First Quarter 2015 Financial Highlights
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Net revenues increased by 46.8% to
RMB860.1 million (US$138.7 million ) fromRMB586.0 million in the comparative period in 2014. -
Adjusted EBITDA1 increased by 47.8% to
RMB166.9 million (US$26.9 million ) fromRMB112.9 million in the comparative period in 2014.
Mr.
Mr.
First Quarter 2015 Financial Results
REVENUES: Net revenues for the first quarter of 2015 increased by 46.8% to
Net revenues from hosting and related services increased by 51.6% to
GROSS PROFIT: Gross profit for the first quarter of 2015 increased by 43.4% to
Adjusted gross profit, which excludes share-based compensation expenses and amortization of intangible assets derived from acquisitions, increased by 59.4% to
OPERATING EXPENSES: Total operating expenses decreased by 2.3% to
Sales and marketing expenses increased by 113.2% to
General and administrative expenses decreased by 28.0% to
Research and development expenses increased by 35.0% to
Change in the fair value of contingent purchase consideration payable was a loss of
ADJUSTED EBITDA: Adjusted EBITDA for the first quarter of 2015 increased by 47.8% to
NET PROFIT/LOSS: Net loss for the first quarter of 2015 was
Adjusted net profit for the first quarter of 2015 was
EARNING/LOSS PER SHARE: Diluted loss per ordinary share for the first quarter of 2015 was
As of
BALANCE SHEET: As of
First Quarter 2015 Operational Highlights
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Monthly Recurring Revenues ("MRR") per cabinet was
RMB10,031 in the first quarter of 2015, compared withRMB10,400 in the fourth quarter of 2014. -
Total cabinets under management increased to 22,024 as of
March 31, 2015 , from 21,522 as ofDecember 31, 2014 , with 14,911 cabinets in the Company's self-built data centers and 7,113 cabinets in its partnered data centers. - Utilization rate was 65.0% in the first quarter of 2015, compared with 70.2% in the fourth quarter of 2014.
- Hosting churn rate, which is based on the Company's core IDC business, was 0.19% in the first quarter of 2015, compared with 0.25% in the fourth quarter of 2014.
Recent Developments
On
In
Mr. Erhfei Liu brings to the board extensive experience as a senior executive in the Asian financial markets. From 1999 to 2012,
Mr.
Mr.
Financial Outlook
For the second quarter of 2015, the Company expects net revenues to be in the range of
Conference Call
The Company will hold a conference call on
Participants may access the call by dialing the following numbers:
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+1-845-675-0438 |
International Toll Free: | +1-855-500-8701 |
China Domestic: | 400-1200654 |
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+852-3018-6776 |
Conference ID: | # 30908762 |
The replay will be accessible through
United States Toll Free: | +1-855-452-5696 |
International: | +61-2-90034211 |
Conference ID: | # 30908762 |
A live and archived webcast of the conference call will be available through the Company's investor relation website at http://ir.21vianet.com.
Non-GAAP Disclosure
In evaluating its business, 21Vianet considers and uses the following non-GAAP measures defined as non-GAAP financial measures by the
The non-GAAP financial measures are provided as additional information to help investors compare business trends among different reporting periods on a consistent basis and to enhance investors' overall understanding of the Company's current financial performance and prospects for the future. These non-GAAP financial measures should be considered in addition to results prepared in accordance with U.S. GAAP, but should not be considered a substitute for, or superior to, U.S. GAAP results. In addition, the Company's calculation of the non-GAAP financial measures may be different from the calculation used by other companies, and therefore comparability may be limited.
Exchange Rate
This announcement contains translations of certain RMB amounts into U.S. dollars ("USD") at specified rates solely for the convenience of the reader. Unless otherwise stated, all translations from RMB to USD were made at the rate of RMB6.1990 to
Statement Regarding Unaudited Condensed Financial Information
The unaudited financial information set forth above is preliminary and subject to potential adjustments. Adjustments to the consolidated financial statements may be identified when audit work has been performed for the Company's year-end audit, which could result in significant differences from this preliminary unaudited condensed financial information.
About 21Vianet
Safe Harbor Statement
This announcement contains forward-looking statements. These forward-looking statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Among other things, the outlook for the second quarter and full year of 2015 and quotations from management in this announcement, as well as 21Vianet's strategic and operational plans, contain forward-looking statements. 21Vianet may also make written or oral forward-looking statements in its reports filed with, or furnished to, the
1 Adjusted EBITDA is a non-GAAP financial measure, which is defined as EBITDA excluding share-based compensation expenses and changes in the fair value of contingent purchase consideration payable and EBITDA is defined as net profit (loss) from operations before income tax expense (benefit), foreign exchange gain, other expenses, other income, interest expense, interest income and depreciation and amortization.
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CONSOLIDATED BALANCE SHEETS | |||
(Amount in thousands of Renminbi ("RMB") and US dollars ("US$")) | |||
As of | As of | ||
2014 |
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RMB | RMB | US$ | |
(Audited) | (Unaudited) | (Unaudited) | |
Assets | |||
Current assets: | |||
Cash and cash equivalents | 644,415 | 1,277,414 | 206,068 |
Restricted cash | 161,649 | 138,196 | 22,293 |
Accounts and notes receivable, net | 739,945 | 747,874 | 120,644 |
Short-term investments | 911,242 | 744,346 | 120,075 |
Inventories | 10,059 | 10,690 | 1,724 |
Prepaid expenses and other current assets | 309,441 | 386,696 | 62,379 |
Deferred tax assets | 35,002 | 35,482 | 5,724 |
Amount due from related parties | 54,867 | 55,200 | 8,905 |
Total current assets | 2,866,620 | 3,395,898 | 547,812 |
Non-current assets: | |||
Property and equipment, net | 3,036,707 | 3,181,138 | 513,170 |
Intangible assets, net | 1,404,453 | 1,373,504 | 221,569 |
Land use right | 66,175 | 65,803 | 10,615 |
Deferred tax assets | 42,573 | 43,591 | 7,032 |
Goodwill | 1,755,970 | 1,755,970 | 283,267 |
Long term investments | 126,307 | 157,847 | 25,463 |
Restricted cash | 121,415 | 122,696 | 19,793 |
Amount due from related parties | 98,500 | 98,500 | 15,890 |
Other non-current assets | 121,461 | 134,250 | 21,657 |
Total non-current assets | 6,773,561 | 6,933,299 | 1,118,456 |
Total assets | 9,640,181 | 10,329,197 | 1,666,268 |
Liabilities and Shareholders' Equity | |||
Current liabilities: | |||
Short-term bank borrowings | 160,181 | 201,000 | 32,425 |
Accounts and notes payable | 386,074 | 427,550 | 68,971 |
Accrued expenses and other payables | 599,491 | 568,662 | 91,734 |
Deferred revenue | 347,441 | 340,421 | 54,915 |
Advances from customers | 97,679 | 106,212 | 17,134 |
Income taxes payable | 35,013 | 46,471 | 7,497 |
Amounts due to related parties | 326,804 | 346,934 | 55,966 |
Current portion of long-term bank borrowings | 955,647 | 955,174 | 154,085 |
Current portion of capital lease obligations | 71,939 | 79,771 | 12,868 |
Current portion of deferred government grant | 6,150 | 7,722 | 1,246 |
Current portion of bonds payable | -- | 264,174 | 42,616 |
Deferred tax liabilities | 2,696 | 263 | 42 |
Total current liabilities | 2,989,115 | 3,344,354 | 539,499 |
Non-current liabilities: | |||
Long-term bank borrowings | 61,673 | 101,281 | 16,338 |
Deferred revenue | 74,044 | 71,686 | 11,564 |
Amounts due to related parties | 280,728 | 273,105 | 44,056 |
Unrecognized tax benefits | 20,453 | 21,739 | 3,507 |
Deferred tax liabilities | 310,340 | 302,139 | 48,740 |
Non-current portion of capital lease obligations | 511,679 | 505,522 | 81,549 |
Non-current portion of deferred government grant | 27,422 | 33,450 | 5,396 |
Bonds payable | 2,264,064 | 2,000,000 | 322,633 |
Mandatorily redeemable noncontrolling interests | 100,000 | 100,000 | 16,132 |
Total non-current liabilities | 3,650,403 | 3,408,922 | 549,915 |
Redeemable noncontrolling interests | 773,706 | 773,637 | 124,800 |
Shareholders' equity | |||
Treasury stock | (213,665) | (213,665) | (34,468) |
Ordinary shares | 26 | 33 | 5 |
Additional paid-in capital | 4,225,029 | 6,081,402 | 981,030 |
Accumulated other comprehensive income loss | (65,754) | (63,069) | (10,174) |
Statutory reserves | 52,263 | 55,886 | 9,015 |
Accumulated deficit | (1,794,975) | (1,895,325) | (305,746) |
Receivable for issuance of ordinary shares | -- | (1,181,824) | (190,648) |
Total |
2,202,924 | 2,783,438 | 449,014 |
Non-controlling interest | 24,033 | 18,846 | 3,040 |
Total shareholders' equity | 2,226,957 | 2,802,284 | 452,054 |
Total liabilities and shareholders' equity | 9,640,181 | 10,329,197 | 1,666,268 |
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CONSOLIDATED STATEMENTS OF OPERATIONS | ||||
(Amount in thousands of Renminbi ("RMB") and US dollars ("US$") except for number of shares and per share data) | ||||
Three months ended | ||||
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RMB | RMB | RMB | US$ | |
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |
Net revenues | ||||
Hosting and related services | 404,375 | 596,221 | 613,228 | 98,924 |
Managed network services | 181,620 | 257,689 | 246,879 | 39,825 |
Total net revenues | 585,995 | 853,910 | 860,107 | 138,749 |
Cost of revenues | (425,369) | (615,877) | (629,762) | (101,591) |
Gross profit | 160,626 | 238,033 | 230,345 | 37,158 |
Operating expenses | ||||
Sales and marketing expenses | (42,393) | (100,075) | (90,400) | (14,583) |
General and administrative expenses | (179,394) | (159,576) | (129,208) | (20,843) |
Research and development expenses | (25,205) | (39,906) | (34,031) | (5,490) |
Changes in the fair value of contingent purchase consideration payable | (33,928) | (44,789) | (20,946) | (3,379) |
Total operating expenses | (280,920) | (344,346) | (274,585) | (44,295) |
Operating loss | (120,294) | (106,313) | (44,240) | (7,137) |
Interest income | 21,240 | 12,862 | 13,830 | 2,231 |
Interest expense | (48,977) | (66,531) | (71,867) | (11,593) |
(Loss) gain from equity method investment | (376) | 78 | 11,295 | 1,822 |
Other income | 3,617 | 15,413 | 1,660 | 268 |
Other expense | (21) | (70) | (951) | (153) |
Foreign exchange gain (loss) | 937 | (8,756) | 10,167 | 1,640 |
Loss before income taxes | (143,874) | (153,317) | (80,106) | (12,922) |
Income tax expense | (7,552) | (2,168) | (8,563) | (1,381) |
Consolidated net loss | (151,426) | (155,485) | (88,669) | (14,303) |
Net profit attributable to non-controlling interest | (348) | (18,603) | (8,058) | (1,300) |
Net loss attributable to ordinary shareholders | (151,774) | (174,088) | (96,727) | (15,603) |
Loss per share | ||||
Basic | (0.38) | (0.44) | (0.23) | (0.04) |
Diluted | (0.38) | (0.44) | (0.23) | (0.04) |
Shares used in loss per share computation | ||||
Basic* | 399,728,129 | 400,031,170 | 432,372,059 | 432,372,059 |
Diluted* | 399,728,129 | 400,031,170 | 432,372,059 | 432,372,059 |
Loss per ADS (6 ordinary shares equal to 1 ADS) | ||||
Basic | (2.28) | (2.64) | (1.38) | (0.22) |
Diluted | (2.28) | (2.64) | (1.38) | (0.22) |
* Shares used in loss per share/ADS computation were computed under weighted average method. |
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RECONCILIATIONS OF GAAP AND NON-GAAP RESULTS | ||||
(Amount in thousands of Renminbi ("RMB") and US dollars ("US$") except for number of shares and per share data) | ||||
Three months ended | ||||
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RMB | RMB | RMB | US$ | |
Gross profit | 160,626 | 238,033 | 230,345 | 37,158 |
Plus: Share-based compensation expense | 1,668 | 3,722 | 2,212 | 357 |
Plus: Amortization of intangible assets derived from acquisitions | 8,798 | 48,953 | 40,169 | 6,480 |
Adjusted gross profit | 171,092 | 290,708 | 272,726 | 43,995 |
Adjusted gross margin | 29.2% | 34.0% | 31.7% | 31.7% |
Operating expenses | (280,920) | (344,346) | (274,585) | (44,295) |
Plus: Share-based compensation expense | 137,047 | 65,144 | 44,244 | 7,137 |
Plus: Changes in the fair value of contingent purchase consideration payable | 33,928 | 44,789 | 20,946 | 3,379 |
Adjusted operating expenses | (109,945) | (234,413) | (209,395) | (33,779) |
Net loss | (151,426) | (155,485) | (88,669) | (14,303) |
Plus: Share-based compensation expense | 138,715 | 68,866 | 46,456 | 7,494 |
Plus: Amortization of intangible assets derived from acquisitions | 8,798 | 48,953 | 40,169 | 6,480 |
Plus: Changes in the fair value of contingent purchase consideration payable and related deferred tax impact | 36,912 | 44,789 | 20,946 | 3,379 |
Adjusted net profit | 32,999 | 7,123 | 18,902 | 3,050 |
Adjusted net margin | 5.6% | 0.8% | 2.2% | 2.2% |
Net loss | (151,426) | (155,485) | (88,669) | (14,303) |
Minus: Provision for income taxes | (7,552) | (2,168) | (8,563) | (1,381) |
Minus: Interest income | 21,240 | 12,862 | 13,830 | 2,231 |
Minus: Interest expense | (48,977) | (66,531) | (71,867) | (11,593) |
Minus: Exchange gain (loss) | 937 | (8,756) | 10,167 | 1,640 |
Minus: (Loss) gain from equity method investment | (376) | 78 | 11,295 | 1,822 |
Minus: Other income | 3,617 | 15,413 | 1,660 | 268 |
Minus: Other expense | (21) | (70) | (951) | (153) |
Plus: Depreciation | 46,326 | 93,240 | 93,878 | 15,144 |
Plus: Amortization | 14,257 | 59,536 | 49,876 | 8,046 |
Plus: Share-based compensation expense | 138,715 | 68,866 | 46,456 | 7,494 |
Plus: Changes in the fair value of contingent purchase consideration payable | 33,928 | 44,789 | 20,946 | 3,379 |
Adjusted EBITDA | 112,932 | 160,118 | 166,916 | 26,926 |
Adjusted EBITDA margin | 19.3% | 18.8% | 19.4% | 19.4% |
Adjusted net profit | 32,999 | 7,123 | 18,902 | 3,050 |
Less: Net profit attributable to non-controlling interest | (348) | (18,603) | (8,058) | (1,300) |
Adjusted net profit (loss) attributable to the Company's ordinary shareholders | 32,651 | (11,480) | 10,844 | 1,750 |
Adjusted earnings (loss) per share | ||||
Basic | 0.08 | (0.03) | 0.02 | 0.00 |
Diluted | 0.08 | (0.03) | 0.02 | 0.00 |
Shares used in adjusted earnings (loss) per share computation: | ||||
Basic* | 399,728,129 | 400,031,170 | 432,372,059 | 432,372,059 |
Diluted* | 414,017,635 | 400,031,170 | 444,663,246 | 444,663,246 |
Earnings (loss) per ADS (6 ordinary shares equal to 1 ADS) | ||||
Basic | 0.48 | (0.18) | 0.12 | 0.02 |
Diluted | 0.48 | (0.18) | 0.12 | 0.02 |
* Shares used in adjusted earnings (loss) per share/ADS computation were computed under weighted average method. |
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CONSOLIDATED STATEMENT OF CASH FLOWS | |||
(Amount in thousands of Renminbi ("RMB") and US dollars ("US$")) | |||
Three months ended | |||
December 31, 2014 |
March 31, 2015 |
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RMB | RMB | US$ | |
(Unaudited) | (Unaudited) | (Unaudited) | |
CASH FLOWS FROM OPERATING ACTIVITIES | |||
Net loss | (155,485) | (88,669) | (14,303) |
Adjustments to reconcile net profit to net cash generated from operating activities: | |||
Foreign exchange loss (gain) | 8,756 | (10,167) | (1,640) |
Changes in the fair value of contingent purchase consideration payable | 44,789 | 20,946 | 3,379 |
Depreciation of property and equipment | 93,240 | 93,878 | 15,144 |
Amortization of intangible assets | 59,536 | 47,709 | 7,696 |
(Gain) Loss on disposal of property and equipment | (133) | 131 | 21 |
Provision for doubtful accounts and other receivables | 5,946 | 1,335 | 215 |
Share-based compensation expense | 68,866 | 46,456 | 7,494 |
Deferred income taxes benefit | (13,500) | (12,132) | (1,957) |
Gain from equity method investment | (78) | (11,295) | (1,822) |
Changes in operating assets and liabilities | |||
Restricted cash | (28,139) | 14,739 | 2,378 |
Inventories | (1,682) | (631) | (102) |
Accounts and notes receivable | 8,442 | (9,264) | (1,494) |
Unrecognized tax expense | 7,072 | 1,286 | 207 |
Prepaid expenses and other current assets | 62,870 | (86,716) | (13,989) |
Amounts due from related parties | (2,844) | 9,670 | 1,560 |
Accounts and notes payable | (3,321) | 41,476 | 6,691 |
Accrued expenses and other payables | (44,215) | 36,153 | 5,832 |
Deferred revenue | (7,305) | (9,378) | (1,513) |
Advances from customers | 18,114 | 8,533 | 1,377 |
Income taxes payable | (9,897) | 11,458 | 1,848 |
Amounts due to related parties | 3,879 | (1,308) | (211) |
Deferred government grants | (3,133) | 7,600 | 1,226 |
Net cash generated from operating activities | 111,778 | 111,810 | 18,037 |
CASH FLOWS FROM INVESTING ACTIVITIES | |||
Purchases of property and equipment | (191,087) | (305,648) | (49,306) |
Purchases of intangible assets | (18,181) | (16,335) | (2,635) |
Proceeds from disposal of property and equipment | 6,980 | 116 | 19 |
Rental payment of capital leases | (30,716) | -- | -- |
Loans to third parties | (21) | (2,030) | (327) |
Loans to related parties | (185) | -- | -- |
Payments for short-term investments | -- | (733,104) | (118,262) |
Proceeds received from maturity of short-term investments | 55,877 | 900,000 | 145,185 |
Payments for acquisitions, net of cash acquired | 118 | -- | -- |
Payments for long-term investments | -- | (20,245) | (3,266) |
Net cash used in investing activities | (177,215) | (177,246) | (28,592) |
CASH FLOWS FROM FINANCING ACTIVITIES | |||
Restricted cash | (5,105) | 8,714 | 1,406 |
Proceeds from exercise of stock options | 384 | 1,802 | 291 |
Proceeds from shareholders | -- | 626,674 | 101,093 |
Proceeds from long-term bank borrowings | 38,952 | 42,213 | 6,810 |
Proceeds from short-term bank borrowings | 61,000 | 70,000 | 11,292 |
Repayments of short-term bank borrowings | (119,866) | (29,181) | (4,707) |
Repayments of long-term bank borrowings | (12,204) | (3,086) | (498) |
Payments for acquisitions | (503,370) | -- | -- |
Payments for the purchase of noncontrolling interest, net of cash acquired -Ningbo Tech | -- | (8,000) | (1,291) |
Payments for capital leases | -- | (12,341) | (1,991) |
Net cash used in financing activities | (540,209) | 696,795 | 112,405 |
Effect of foreign exchange rate changes on cash and short term investments | (68) | 1,640 | 265 |
Net decrease in cash and cash equivalents | (605,714) | 632,999 | 102,115 |
Cash and cash equivalents at beginning of period | 1,250,129 | 644,415 | 103,953 |
Cash and cash equivalents at end of period | 644,415 | 1,277,414 | 206,068 |
CONTACT: Investor Relations Contacts:21Vianet Group, Inc. Eric Chu , CFA +1 908 707 2062 IR@21Vianet.comJoseph Cheng +86 10 8456 2121 IR@21Vianet.comICR, Inc. Calvin Jiang +1 (646) 405-4922 IR@21Vianet.com
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