21Vianet Group, Inc. Reports Unaudited First Quarter 2020 Financial Results
BEIJING,
First Quarter 2020 Financial Highlights
- Net revenues increased by 25.1% to
RMB1.09 billion (US$154.1 million ) fromRMB871.9 million in the same period of 2019. - Adjusted cash gross profit (non-GAAP) increased by 2.6% to
RMB417.1 million (US$58.9 million ) fromRMB406.7 million in the same period of 2019. Adjusted cash gross margin (non-GAAP) was 38.2%, compared to 46.6% in the same period of 2019. - Adjusted EBITDA (non-GAAP) increased by 2.3% to
RMB259.4 million (US$36.6 million ) fromRMB253.5 million in the same period of 2019. Adjusted EBITDA margin (non-GAAP) was 23.8%, compared to 29.1% in the same period of 2019.
First Quarter 2020 Operational Highlights
- Retail IDC MRR1 per cabinet decreased slightly to
RMB8,747 in the first quarter of 2020, compared toRMB8,788 in the same period of 2019 andRMB8,822 in the fourth quarter of 2019. - Total cabinets under management increased by 3,355 to 39,646 as of
March 31, 2020 , compared to 36,291 as ofDecember 31, 2019 , and 30,578 as ofMarch 31, 2019 . - Compound utilization rate in the first quarter of 2020 fell to 60.4% from 65.6% in the fourth quarter of 2019, mainly due to the continuous delivery of additional cabinets in the first quarter of 2020. Utilization rate for mature IDCs delivered prior to 2019 improved to 72.3% in the first quarter of 2020 from 71.8% in the fourth quarter of 2019. Utilization rate for newly-built and ramp-up IDCs delivered since 2019 improved to 12.3% in the first quarter of 2020, compared to 8.6% in the fourth quarter of 2019.
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1Retail IDC MRR: Refers to Monthly Recurring Revenues for the retail IDC business.
Mr.
Ms.
First Quarter 2020 Financial Results
REVENUES: Net revenues in the first quarter of 2020 increased by 25.1% to
GROSS PROFIT: Gross profit in the first quarter of 2020 was
ADJUSTED CASH GROSS PROFIT (non-GAAP): Adjusted cash gross profit, which is defined as gross profit excluding depreciation, amortization, and share-based compensation expenses, was
OPERATING EXPENSES: Total operating expenses in the first quarter of 2020 were
Sales and marketing expenses in the first quarter of 2020 increased by 10.5% to
Research and development expenses in the first quarter of 2020 were
General and administrative expenses in the first quarter of 2020 were
ADJUSTED OPERATING EXPENSES (non-GAAP): Adjusted operating expenses, which exclude share-based compensation expenses and impairment of receivables from equity investees, increased by 3.8% to
ADJUSTED EBITDA (non-GAAP): Adjusted EBITDA in the first quarter of 2020 was
NET PROFIT/LOSS: Net loss attributable to ordinary shareholders in the first quarter of 2020 was
PROFIT/LOSS PER SHARE: Basic and diluted loss per share were
As of
Net cash generated from operating activities in the first quarter of 2020 was
In
Financial Outlook
For the second quarter of 2020, the Company expects net revenues to be in the range of
For the full year of 2020, the Company expects net revenues to be in the range of
The forecast reflects the Company’s current and preliminary view on the market and its operational conditions, which do not factor in any of the future impacts potentially caused by the COVID-19 pandemic and are subject to change.
Conference Call
The Company will hold a conference call at
In advance of the conference call, all participants must use the following link to complete the online registration process to receive a unique registrant ID and a set of participant dial-in numbers to join the conference call.
Conference ID: | 8074145 |
Registration Link: | http://apac.directeventreg.com/registration/event/8074145 |
The replay will be accessible through
United States Toll Free: | +1-855-452-5696 |
International: | +61-2-8199-0299 |
Conference ID: | 8074145 |
A live and archived webcast of the conference call will be available through the Company's investor relations website at http://ir.21vianet.com.
Non-GAAP Disclosure
In evaluating its business, 21Vianet considers and uses the following non-GAAP measures as a supplemental measure to review and assess its operating performance: adjusted cash gross profit, adjusted cash gross margin, adjusted operating expenses, adjusted EBITDA, and adjusted EBITDA margin. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with
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
Exchange Rate
This announcement contains translations of certain RMB amounts into
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
Investor Relations Contacts:
+86 10 8456 2121
IR@21Vianet.com
+86 10 8456 2121
IR@21Vianet.com
+1 (646) 405-4922
IR@21Vianet.com
CONSOLIDATED BALANCE SHEETS | ||||||
(Amount in thousands of Renminbi (“RMB”) and US dollars (“US$”)) | ||||||
As of | As of | |||||
2019 |
2020 |
|||||
RMB | RMB | US$ | ||||
(Audited) | (Unaudited) | (Unaudited) | ||||
Assets | ||||||
Current assets: | ||||||
Cash and cash equivalents | 1,808,483 | 2,862,088 | 404,204 | |||
Restricted cash | 478,873 | 326,413 | 46,098 | |||
Accounts and notes receivable, net | 657,158 | 856,899 | 121,017 | |||
Short-term investments | 363,856 | 228,521 | 32,273 | |||
Prepaid expenses and other current assets | 1,618,149 | 1,788,378 | 252,568 | |||
Amounts due from related parties | 301,665 | 105,769 | 14,937 | |||
Total current assets | 5,228,184 | 6,168,068 | 871,097 | |||
Non-current assets: | ||||||
Property and equipment, net | 5,443,565 | 5,733,414 | 809,713 | |||
Intangible assets, net | 410,595 | 399,888 | 56,475 | |||
Land use rights, net | 233,154 | 261,451 | 36,924 | |||
Operating lease right-of-use assets, net | 1,221,616 | 1,138,779 | 160,826 | |||
989,530 | 989,530 | 139,748 | ||||
Long-term investments | 169,653 | 172,919 | 24,421 | |||
Amounts due from related parties | 20,654 | 21,182 | 2,991 | |||
Restricted cash | 69,821 | 70,256 | 9,922 | |||
Deferred tax assets | 209,366 | 210,371 | 29,710 | |||
Other non-current assets | 277,568 | 294,532 | 41,596 | |||
Total non-current assets | 9,045,522 | 9,292,322 | 1,312,326 | |||
Total assets | 14,273,706 | 15,460,390 | 2,183,423 | |||
Liabilities and Shareholders' Equity | ||||||
Current liabilities: | ||||||
Short-term bank borrowings | 234,500 | 238,500 | 33,683 | |||
Accounts and notes payable | 303,128 | 374,423 | 52,879 | |||
Accrued expenses and other payables | 978,935 | 1,015,817 | 143,460 | |||
Deferred revenue | 57,625 | 73,058 | 10,318 | |||
Advances from customers | 1,068,692 | 1,158,321 | 163,586 | |||
Income taxes payable | 48,032 | 47,366 | 6,689 | |||
Amounts due to related parties | 166,935 | 60,252 | 8,509 | |||
Current portion of long-term bank borrowings | 32,500 | 32,500 | 4,590 | |||
Current portion of finance lease liabilities | 227,115 | 256,894 | 36,280 | |||
Current portion of deferred government grant | 2,595 | 2,157 | 305 | |||
Current portion of bonds payable | 911,147 | 926,842 | 130,895 | |||
Current portion of operating lease liabilities | 437,817 | 496,618 | 70,135 | |||
Total current liabilities | 4,469,021 | 4,682,748 | 661,329 | |||
Non-current liabilities: | ||||||
Long-term borrowings | 79,500 | 268,369 | 37,901 | |||
Amounts due to related parties | 745,899 | 768,086 | 108,474 | |||
Unrecognized tax benefits | 2,443 | 2,538 | 358 | |||
Deferred tax liabilities | 202,572 | 225,945 | 31,910 | |||
Non-current portion of finance lease liabilities | 896,927 | 894,416 | 126,316 | |||
Non-current portion of deferred government grant | 5,906 | 5,454 | 770 | |||
Bonds payable | 2,060,708 | 2,097,332 | 296,200 | |||
Non-current portion of operating lease liabilities | 579,102 | 481,948 | 68,064 | |||
Convertible notes | - | 899,808 | 127,077 | |||
Total non-current liabilities | 4,573,057 | 5,643,896 | 797,070 | |||
Shareholders' equity | ||||||
(349,523 | ) | (349,523 | ) | (49,362 | ) | |
Ordinary shares | 46 | 46 | 6 | |||
Additional paid-in capital | 9,202,567 | 9,225,788 | 1,302,930 | |||
Accumulated other comprehensive gain | 77,904 | 94,323 | 13,321 | |||
Statutory reserves | 60,469 | 60,186 | 8,501 | |||
Accumulated deficit | (4,038,390 | ) | (4,176,870 | ) | (589,887 | ) |
Total |
4,953,073 | 4,853,950 | 685,509 | |||
Noncontrolling interest | 278,555 | 279,796 | 39,515 | |||
Total shareholders' equity | 5,231,628 | 5,133,746 | 725,024 | |||
Total liabilities and shareholders' equity | 14,273,706 | 15,460,390 | 2,183,423 | |||
CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||
(Amount in thousands of Renminbi (“RMB”) and US dollars (“US$”) except for number of shares and per share data) | ||||||||
Three months ended | ||||||||
2019 |
2019 |
2020 |
||||||
RMB | RMB | RMB | US$ | |||||
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |||||
Net revenues | 871,859 | 1,048,119 | 1,090,797 | 154,050 | ||||
Cost of revenues | (631,084 | ) | (800,248 | ) | (856,686 | ) | (120,987 | ) |
Gross profit | 240,775 | 247,871 | 234,111 | 33,063 | ||||
Operating expenses | ||||||||
Other operating income | - | 6,862 | - | - | ||||
Sales and marketing | (44,096 | ) | (63,188 | ) | (48,710 | ) | (6,879 | ) |
Research and development | (22,564 | ) | (24,920 | ) | (20,984 | ) | (2,964 | ) |
General and administrative | (120,796 | ) | (109,984 | ) | (125,202 | ) | (17,682 | ) |
Allowance for doubtful debt | (22 | ) | (1,072 | ) | (2,521 | ) | (356 | ) |
Impairment of receivables from equity investees | - | (52,142 | ) | - | - | |||
Total operating expenses | (187,478 | ) | (244,444 | ) | (197,417 | ) | (27,881 | ) |
Operating profit | 53,297 | 3,427 | 36,694 | 5,182 | ||||
Interest income | 11,851 | 14,988 | 9,382 | 1,325 | ||||
Interest expense | (69,442 | ) | (88,375 | ) | (102,258 | ) | (14,442 | ) |
Other income | 3,075 | 22,160 | 859 | 121 | ||||
Other expense | (58 | ) | (1,270 | ) | (21,833 | ) | (3,083 | ) |
Foreign exchange gain (loss) | 29,538 | 22,512 | (41,747 | ) | (5,896 | ) | ||
Loss on debt extinguishment | - | (122 | ) | - | - | |||
Gain (loss) before income taxes and (loss) gain from equity method investments | 28,261 | (26,680 | ) | (118,903 | ) | (16,793 | ) | |
Income tax (expenses) benefits | (10,741 | ) | 24,686 | (22,486 | ) | (3,176 | ) | |
(Loss) gain from equity method investments | (10,938 | ) | (20,260 | ) | 3,867 | 546 | ||
Net gain (loss) | 6,582 | (22,254 | ) | (137,522 | ) | (19,423 | ) | |
Net (gain) loss attributable to noncontrolling interest | (942 | ) | 5,838 | (1,241 | ) | (175 | ) | |
Net gain (loss) attributable to ordinary shareholders | 5,640 | (16,416 | ) | (138,763 | ) | (19,598 | ) | |
Profit (loss) per share | ||||||||
Basic | 0.01 | (0.02 | ) | (0.18 | ) | (0.03 | ) | |
Diluted | 0.01 | (0.02 | ) | (0.18 | ) | (0.03 | ) | |
Shares used in profit (loss) per share computation | ||||||||
Basic* | 677,573,837 | 670,523,195 | 669,545,073 | 669,545,073 | ||||
Diluted* | 690,608,562 | 670,523,195 | 669,545,073 | 669,545,073 | ||||
Profit (loss) per ADS (6 ordinary shares equal to 1 ADS) | ||||||||
Basic | 0.06 | (0.12 | ) | (1.08 | ) | (0.18 | ) | |
Diluted | 0.06 | (0.12 | ) | (1.08 | ) | (0.18 | ) | |
* Shares used in (loss) profit per share/ADS computation were computed under weighted average method. | ||||||||
RECONCILIATIONS OF GAAP AND NON-GAAP RESULTS | ||||||||
(Amount in thousands of Renminbi (“RMB”) and US dollars (“US$”)) | ||||||||
Three months ended | ||||||||
2019 |
2019 |
2020 |
||||||
RMB | RMB | RMB | US$ | |||||
Gross profit | 240,775 | 247,871 | 234,111 | 33,063 | ||||
Plus: depreciation and amortization | 165,421 | 177,529 | 182,556 | 25,782 | ||||
Plus: share-based compensation expenses | 474 | 487 | 460 | 65 | ||||
Adjusted cash gross profit | 406,670 | 425,887 | 417,127 | 58,910 | ||||
Adjusted cash gross margin | 46.6 | % | 40.6 | % | 38.2 | % | 38.2 | % |
Operating expenses | (187,478 | ) | (244,444 | ) | (197,417 | ) | (27,881 | ) |
Plus: share-based compensation expenses | 16,165 | 8,102 | 19,628 | 2,772 | ||||
Plus: impairment of receivables from equity investees | - | 52,142 | - | - | ||||
Adjusted operating expenses | (171,313 | ) | (184,200 | ) | (177,789 | ) | (25,109 | ) |
Operating profit | 53,297 | 3,427 | 36,694 | 5,182 | ||||
Plus: depreciation and amortization | 183,532 | 199,642 | 202,607 | 28,614 | ||||
Plus: share-based compensation expenses | 16,639 | 8,589 | 20,088 | 2,837 | ||||
Plus: impairment of receivables from equity investees | - | 52,142 | - | - | ||||
Adjusted EBITDA | 253,468 | 263,800 | 259,389 | 36,633 | ||||
Adjusted EBITDA margin | 29.1 | % | 25.2 | % | 23.8 | % | 23.8 | % |
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS | ||||||||
(Amount in thousands of Renminbi (“RMB”) and US dollars (“US$”)) | ||||||||
Three months ended | ||||||||
2019 |
2019 |
2020 |
||||||
RMB | RMB | RMB | US$ | |||||
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |||||
CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||
Net gain (loss) | 6,582 | (22,254 | ) | (137,522 | ) | (19,423 | ) | |
Adjustments to reconcile net gain (loss) to net cash generated from operating activities: | ||||||||
Depreciation and amortization | 183,532 | 199,642 | 202,607 | 28,614 | ||||
Stock-based compensation expenses | 16,639 | 8,589 | 20,088 | 2,837 | ||||
Others | (31,628 | ) | 11,992 | 42,108 | 5,947 | |||
Changes in operating assets and liabilities | ||||||||
Accounts and notes receivable | (29,603 | ) | 126,542 | (202,262 | ) | (28,565 | ) | |
Prepaid expenses and other current assets | (197,574 | ) | 2,499 | (8,239 | ) | (1,164 | ) | |
Accounts and notes payable | (11,580 | ) | (36,190 | ) | 71,295 | 10,069 | ||
Accrued expenses and other payables | (9,582 | ) | (23,517 | ) | 97,263 | 13,736 | ||
Deferred revenue | (13,812 | ) | (3,391 | ) | 15,433 | 2,180 | ||
Advances from customers | 97,028 | 72,628 | 89,629 | 12,658 | ||||
Others | 22,435 | 108,285 | (131,746 | ) | (18,605 | ) | ||
Net cash generated from operating activities | 32,437 | 444,825 | 58,654 | 8,284 | ||||
CASH FLOWS FROM INVESTING ACTIVITIES | ||||||||
Purchases of property and equipment | (133,470 | ) | (458,230 | ) | (436,034 | ) | (61,580 | ) |
Purchases of intangible assets | (4,328 | ) | (6,919 | ) | (529 | ) | (75 | ) |
(Payments for) proceeds from investments | (62,022 | ) | (136,840 | ) | 207,690 | 29,331 | ||
Proceeds from (payments for) other investing activities | 84,367 | 51,283 | (18,351 | ) | (2,592 | ) | ||
Net cash used in investing activities | (115,453 | ) | (550,706 | ) | (247,224 | ) | (34,916 | ) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||
Proceeds from short-term bank borrowings | 30,000 | 4,500 | 34,000 | 4,802 | ||||
Proceeds from long-term bank borrowings | - | - | 188,869 | 26,673 | ||||
Repayment of long-term bank borrowings | - | (13,000 | ) | - | - | |||
Repayment of short-term bank borrowings | (50,000 | ) | - | (30,000 | ) | (4,237 | ) | |
Payments for finance lease | (92,537 | ) | (91,487 | ) | (77,336 | ) | (10,922 | ) |
Proceeds from issuance of Convertible notes | - | - | 899,808 | 127,077 | ||||
(Payments for) proceeds from other financing activities | (55,474 | ) | 21,892 | 61,008 | 8,617 | |||
Net cash (used in) generated from financing activities | (168,011 | ) | (78,095) | 1,076,349 | 152,010 | |||
Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash | (34,488 | ) | (46,956 | ) | 13,800 | 1,949 | ||
Net (decrease) increase in cash, cash equivalents and restricted cash | (285,515 | ) | (230,932 | ) | 901,580 | 127,327 | ||
Cash, cash equivalents and restricted cash at beginning of period | 2,661,021 | 2,588,109 | 2,357,177 | 332,897 | ||||
Cash, cash equivalents and restricted cash at end of period | 2,375,506 | 2,357,177 | 3,258,757 | 460,224 | ||||
Source: 21Vianet Group, Inc.