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VNET Reports Unaudited Fourth Quarter and Full Year 2021 Financial Results
Mar 30,2022

BEIJING, March 30, 2022 /PRNewswire/ -- VNET Group, Inc. (Nasdaq: VNET) ("VNET" or the "Company"), a leading carrier- and cloud-neutral Internet data center services provider in China, today announced its unaudited financial results for the fourth quarter and full year ended December 31, 2021. The Company will hold a conference call at 9:00 PM on March 30, 2022, U.S. Eastern Time (9:00 AM on March 31, 2021, Beijing time) to discuss the financial results. Dial-in details are provided at the end of this release.

Fourth Quarter 2021 Financial Highlights

  • Net revenues increased by 29.4% to RMB1.75 billion (US$273.9 million) from RMB1.35 billion in the same period of 2020.
  • Adjusted cash gross profit (non-GAAP) increased by 22.7% to RMB713.8 million (US$112.0 million) from RMB581.9 million in the same period of 2020. Adjusted cash gross margin (non-GAAP) was 40.9%, compared to 43.2% in the same period of 2020.
  • Adjusted EBITDA (non-GAAP) increased by 18.8% to RMB463.0 million (US$72.7 million) from RMB389.8 million in the same period of 2020. Adjusted EBITDA margin (non-GAAP) was 26.5%, compared to 28.9% in the same period of 2020.

Full Year 2021 Financial Highlights

  • Net revenues increased by 28.2% to RMB6.19 billion (US$971.3 million) from RMB4.83 billion in the full year of 2020.
  • Adjusted cash gross profit (non-GAAP) increased by 32.2% to RMB2.63 billion (US$413.3 million) from RMB1.99 billion in the full year of 2020. Adjusted cash gross margin (non-GAAP) was 42.6%, compared to 41.3% in the full year of 2020.
  • Adjusted EBITDA (non-GAAP) increased by 32.4% to RMB1.75 billion (US$275.2 million) from RMB1.32 billion in the full year of 2020. Adjusted EBITDA margin (non-GAAP) was 28.3%, compared to 27.4% in the full year of 2020.

Fourth Quarter 2021 Operational Highlights

  • Total cabinets under management net increased by 13,276 in the fourth quarter of 2021 to 78,540 as of December 31, 2021, a 46.7% year-over-year growth, compared to 53,553 as of December 31, 2020, and 65,264 as of September 30, 2021.
  • Retail IDC MRR[1] per cabinet was RMB9,301, compared to RMB9,131 in the same period of 2020 and RMB9,296 in the third quarter of 2021.
  • Compound utilization rate was 61.6%, compared to 59.8% in the third quarter of 2021.
    • Utilization rate for mature cabinets, which consisted of cabinet deliveries prior to and during 2019, was 76.7%, compared to 75.5% in the third quarter of 2021.
    • Utilization rate for ramp-up and newly-built cabinets, which consisted of cabinet deliveries in 2020 and 2021, was 39.6%, compared to 34.7% in the third quarter of 2021.

[1] Retail IDC MRR refers to Monthly Recurring Revenues for the retail IDC business.

Mr. Samuel Shen, Chief Executive Officer and Executive Chairman of VNET's Retail IDC, stated, "2021 concluded as a rewarding year for us, as we consistently executed our dual-core growth engine strategy even in the face of numerous external challenges. Underpinned by favorable government policy and longstanding digitalization trends, we continued to deliver robust growth while further diversifying our financing solutions and augmenting the resilience of our business. By committing ourselves to long-term sustainability and effectively implementing our dual-core strategy, we are uniquely and firmly positioned to deliver continued business growth and enhance our leading position in China's data center sector. Given the evolving regulatory environment, we are planning a secondary listing on the Hong Kong Stock Exchange to provide our shareholders with an additional trading venue and protection. The timing of our contemplated secondary listing is subject to market conditions and regulatory approvals."

Mr. Tim Chen, Chief Financial Officer of the Company, commented, "We delivered healthy results this quarter with revenue growth of 29% year-over-year and adjusted EBITDA growth of 19% year-over-year. For the full year of 2021, we met our annual guidance for cabinet delivery despite macro uncertainties and external challenges. Looking ahead, we will continue to explore various financing solutions to enhance the health of our balance sheet, capitalize on rapid growth in IDC demand, and generate increasing value for our shareholders."

Fourth Quarter 2021 Financial Results

NET REVENUES: Net revenues in the fourth quarter of 2021 was RMB1.75 billion (US$273.9 million), representing an increase of 29.4% from RMB1.35 billion in the same period of 2020 and an increase of 11.9% from RMB1.56 billion in the third quarter of 2021. The year-over-year and quarter-over-quarter increase was mainly due to the increased demand from both wholesale and retail IDC customers, as well as the growth of revenue from cloud business.

GROSS PROFIT: Gross profit in the fourth quarter of 2021 was RMB380.0 million (US$59.6 million), representing an increase of 29.1% from RMB294.4 million in the same period of 2020 and an increase of 1.3% from RMB375.2 million in the third quarter of 2021. Gross margin in the fourth quarter of 2021 was 21.8%, compared to 21.8% in the same period of 2020 and 24.0% in the third quarter of 2021. The quarter-over-quarter decrease in gross margin was primarily attributable to the massive delivery of new cabinets in the fourth quarter of 2021, which usually have a ramp-up phase to reach the expected profit level.

ADJUSTED CASH GROSS PROFIT, which excludes depreciation, amortization, and share-based compensation expenses, was RMB713.8 million (US$112.0 million) in the fourth quarter of 2021, compared to RMB581.9 million in the same period of 2020 and RMB674.5 million in the third quarter of 2021. Adjusted cash gross margin in the fourth quarter of 2021 was 40.9%, compared to 43.2% in both the same period of 2020 and the third quarter of 2021.
      
OPERATING EXPENSES: Total operating expenses in the fourth quarter of 2021 were RMB649.7 million (US$102.0 million), compared to RMB369.2 million in the same period of 2020 and RMB261.3 million in the third quarter of 2021. As a percentage of net revenues, total operating expenses in the fourth quarter of 2021 were 37.2%, compared to 27.4% in the same period of 2020 and 16.7% in the third quarter of 2021.

Sales and marketing expenses in the fourth quarter of 2021 were RMB85.5 million (US$13.4 million), compared to RMB88.9 million in the same period of 2020 and RMB36.4 million in the third quarter of 2021.

Research and development expenses in the fourth quarter of 2021 were RMB63.0 million (US$9.9 million), compared to RMB42.2 million in the same period of 2020 and RMB53.6 million in the third quarter of 2021.

General and administrative expenses in the fourth quarter of 2021 were RMB390.9 million (US$61.3 million), compared to RMB162.9 million in the same period of 2020 and RMB161.9 million in the third quarter of 2021. The increase was primarily due to one-off share-based compensation expenses.

ADJUSTED OPERATING EXPENSES, which exclude share-based compensation expenses, compensation for postcombination employment in an acquisition, impairment of loan receivable to potential investee and impairment of long-lived assets, were RMB273.7 million (US$43.0 million) in the fourth quarter of 2021, compared to RMB215.5 million in the same period of 2020 and RMB244.0 million in the third quarter of 2021. As a percentage of net revenues, adjusted operating expenses in the fourth quarter of 2021 were 15.7%, compared to 16.0% in the same period of 2020 and 15.6% in the third quarter of 2021.

ADJUSTED EBITDA: Adjusted EBITDA in the fourth quarter of 2021 was RMB463.0 million (US$72.7 million), representing an increase of 18.8% from RMB389.8 million in the same period of 2020 and an increase of 2.8% from RMB450.4 million in the third quarter of 2021. Adjusted EBITDA in the fourth quarter of 2021 excluded share-based compensation expenses of RMB253.0 million (US$39.7 million). Adjusted EBITDA margin in the fourth quarter of 2021 was 26.5%, compared to 28.9% in both the same period of 2020 and the third quarter of 2021.

NET PROFIT/LOSS: Net loss attributable to ordinary shareholders in the fourth quarter of 2021 was RMB27.3 million (US$4.3 million), compared to a net loss of RMB1.02 billion in the same period of 2020 and a net profit of RMB156.2 million in the third quarter of 2021. Net loss attributable to ordinary shareholders in the fourth quarter of 2021 included impairment of long-lived assets of RMB109.3 million (US$17.1 million) and gains from changes in the fair value of convertible promissory notes of RMB227.8 million (US$35.8 million) due to the decrease in the Company's stock price.

PROFIT/LOSS PER SHARE: Basic and diluted loss per share were RMB0.03 (US$0.005) and RMB0.28 (US$0.04) in the fourth quarter of 2021, respectively, which represented the equivalent of RMB0.18 (US$0.03) and RMB1.68 (US$0.24) per American depositary share ("ADS"), respectively. Each ADS represents six Class A ordinary shares.

As of December 31, 2021, the aggregate amount of the Company's cash and cash equivalents, restricted cash, and short-term investments was RMB1.71 billion (US$268.1 million).

Net cash generated from operating activities, in the fourth quarter of 2021 was RMB664.0 million (US$104.2 million), compared to RMB283.8 million in the same period of 2020 and RMB134.7 million in the third quarter of 2021.

Full Year 2021 Financial Results

NET REVENUES: Net revenues in the full year of 2021 increased by 28.2% to RMB6.19 billion (US$971.3 million) from RMB4.83 billion in the full year of 2020.

GROSS PROFIT: Gross profit in the full year of 2021 was RMB1.44 billion (US$225.7 million), representing an increase of 33.6% from RMB1.08 billion in the full year of 2020. Gross margin in the full year of 2021 was 23.2%, compared to 22.3% in the full year of 2020.

ADJUSTED CASH GROSS PROFIT, which excludes depreciation, amortization, and share-based compensation expenses, was RMB2.63 billion (US$413.3 million) in the full year of 2021, compared to RMB1.99 billion in the full year of 2020. Adjusted cash gross margin in the full year of 2021 was 42.6%, compared to 41.3% in the full year of 2020.

OPERATING EXPENSES: Total operating expenses in the full year of 2021 were RMB1.42 billion (US$222.3 million), compared to RMB959.4 million in the full year of 2020. As a percentage of net revenues, total operating expenses in the full year of 2021 were 22.9%, compared to 19.9% in the full year of 2020.

Sales and marketing expenses in the full year of 2021 were RMB255.4 million (US$40.1 million), representing an increase of 8.7% from RMB235.0 million in the full year of 2020.

Research and development expenses in the full year of 2021 were RMB188.5 million (US$29.6 million), representing an increase of 67.0% from RMB112.9 million in the full year of 2020.

General and administrative expenses in the full year of 2021 were RMB842.4 million (US$132.2 million), representing an increase of 57.4% from RMB535.1 million in the full year of 2020.

ADJUSTED OPERATING EXPENSES, which exclude share-based compensation expenses, compensation for postcombination employment in an acquisition, impairment of loan receivable to potential investee and impairment of long-lived assets, were RMB965.7 million (US$151.5 million) in the full year of 2021, compared to RMB756.2 million in the full year of 2020. As a percentage of net revenues, adjusted operating expenses in the full year of 2021 were 15.6%, compared to 15.7% in the full year of 2020.

ADJUSTED EBITDA: Adjusted EBITDA in the full year of 2021 was RMB1.75 billion (US$275.2 million), representing an increase of 32.4% from RMB1.32 billion in the full year of 2020. Adjusted EBITDA in the full year of 2021 excluded share-based compensation expenses of RMB320.0 million (US$50.2 million). Adjusted EBITDA margin in the full year of 2021 was 28.3%, compared to 27.4% in the full year of 2020.

NET PROFIT/LOSS: Net profit attributable to ordinary shareholders in the full year of 2021 was RMB500.1 million (US$78.5 million), compared to net loss attributable to ordinary shareholders of RMB3.18 billion in the full year of 2020. Net profit attributable to ordinary shareholders in the full year of 2021 included gains from changes in the fair value of convertible promissory notes of RMB829.1 million (US$130.1 million) due to the decrease in the Company's stock price.

PROFIT/LOSS PER SHARE: Basic profit per share and diluted loss per share were RMB0.57 (US$0.09) and RMB0.36 (US$0.06), respectively, which represents the equivalent of RMB3.42 (US$0.54) and RMB2.16 (US$0.36) per ADS. Diluted profit/loss per share is calculated using adjusted net profit/loss attributable to ordinary shareholders divided by the weighted average number of diluted shares outstanding.

Net cash generated from operating activities in the full year of 2021 was RMB1.39 billion (US$217.8 million), compared to RMB714.2 million in the full year of 2020.

Financial Outlook

For the full year of 2022, the Company expects net revenues to be in the range of RMB7,450 million to RMB7,750 million. Adjusted EBITDA is expected to be in the range of RMB1,975 million to RMB2,125 million. The midpoints of the Company's updated estimates imply an increase of 22.8% and 16.9% year over year in net revenues and adjusted EBITDA, respectively.

The forecast reflects the Company's current and preliminary views on the market and its operational conditions, which does not factor in any of the potential future impacts caused by the ongoing COVID-19 pandemic, and is subject to change.

Conference Call

The Company will hold a conference call at 9:00 P.M. on Wednesday, March 30, 2022, U.S. Eastern Time, or 9:00 A.M. on Thursday, March 31, 2022, Beijing Time, to discuss the financial results.

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:

 

7127417

Registration Link:

 

http://apac.directeventreg.com/registration/event/7127417 

     

The replay will be accessible through April 7, 2022, by dialing the following numbers:

     

United States Toll Free:

 

+1-855-452-5696

International: 

 

+61-2-9003-4211

Conference ID:

 

7127417

A live and archived webcast of the conference call will be available through the Company's investor relations website at http://ir.vnet.com.

Non-GAAP Disclosure

In evaluating its business, VNET considers and uses the following non-GAAP measures defined as non-GAAP financial measures by the U.S. Securities and Exchange Commission 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 U.S. GAAP. For more information on these non-GAAP financial measures, please see the table captioned "Reconciliations of GAAP and non-GAAP results" set forth at the end of this press release.

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 RMB6.3726 to US$1.00, the noon buying rate in effect on December 31, 2021, in the H.10 statistical release of the Federal Reserve Board. The Company makes no representation that the RMB or USD amounts referred could be converted into USD or RMB, as the case may be, at any particular rate or at all. For analytical presentation, all percentages are calculated using the numbers presented in the financial statements contained in this earnings release.

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 VNET

VNET Group, Inc. is a leading carrier- and cloud-neutral Internet data center services provider in China. VNET provides hosting and related services, including IDC services, cloud services, and business VPN services to improve the reliability, security, and speed of its customers' internet infrastructure. Customers may locate their servers and equipment in VNET's data centers and connect to China's internet backbone. VNET operates in more than 30 cities throughout China, servicing a diversified and loyal base of over 6,500 hosting and related enterprise customers that span numerous industries ranging from internet companies to government entities and blue-chip enterprises to small- to mid-sized enterprises.

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," "target," "believes," "estimates" and similar statements. Among other things, quotations from management in this announcement as well as VNET's strategic and operational plans contain forward-looking statements. VNET may also make written or oral forward-looking statements in its reports filed with, or furnished to, the U.S. Securities and Exchange Commission, in its annual reports 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 VNET'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: VNET's goals and strategies; VNET's expansion plans; the expected growth of the data center services market; expectations regarding demand for, and market acceptance of, VNET's services; VNET's expectations regarding keeping and strengthening its relationships with customers; VNET's plans to invest in research and development to enhance its solution and service offerings; and general economic and business conditions in the regions where VNET provides solutions and services. Further information regarding these and other risks is included in VNET's reports filed with, or furnished to, the U.S. Securities and Exchange Commission. All information provided in this press release and in the attachments is as of the date of this press release, and VNET undertakes no duty to update such information, except as required under applicable law.

Investor Relations Contact:

Xinyuan Liu
Tel: +86 10 8456 2121
Email: ir@vnet.com

 

 

 

VNET GROUP, INC. 

 CONSOLIDATED BALANCE SHEETS 

 (Amount in thousands of Renminbi ("RMB") and US dollars ("US$")) 

           
 

 As of 

 As of  

December 31, 2020

December 31, 2021

 

 RMB

 

 RMB 

 

 US$ 

 

 (Audited)

 

 (Unaudited) 

 

 (Unaudited) 

 Assets                                                                    

         

 Current assets: 

         

 Cash and cash equivalents 

2,710,349

 

1,372,481

 

215,372

 Restricted cash 

270,450

 

327,767

 

51,434

 Accounts and notes receivable, net 

847,233

 

1,405,997

 

220,632

 Short-term investments 

285,872

 

-

 

-

 Prepaid expenses and other current assets 

1,866,184

 

2,049,911

 

321,673

 Amounts due from related parties 

75,519

 

167,967

 

26,358

 Total current assets 

6,055,607

 

5,324,123

 

835,469

           

 Non-current assets: 

         

 Property and equipment, net 

8,106,425

 

10,092,419

 

1,583,721

 Intangible assets, net 

658,195

 

900,335

 

141,282

 Land use rights, net 

255,373

 

337,235

 

52,920

 Operating lease right-of-use assets, net 

1,325,526

 

2,869,338

 

450,262

 Goodwill 

994,993

 

1,339,657

 

210,221

 Restricted cash 

135,638

 

8,225

 

1,291

 Deferred tax assets, net 

185,481

 

168,002

 

26,363

 Long-term investments, net 

135,517

 

98,243

 

15,416

 Amounts due from related parties 

20,562

 

-

 

-

 Other non-current assets 

1,500,438

 

1,957,462

 

307,169

 Total non-current assets 

13,318,148

 

17,770,916

 

2,788,645

 Total assets 

19,373,755

 

23,095,039

 

3,624,114

           

 Liabilities and Shareholders' Equity 

         

 Current liabilities: 

         

 Short-term bank borrowings 

34,000

 

-

 

-

 Accounts and notes payable 

289,387

 

493,506

 

77,442

 Accrued expenses and other payables 

1,631,563

 

2,298,089

 

360,620

 Advances from customers 

1,041,594

 

1,041,902

 

163,497

 Deferred revenue 

63,245

 

55,695

 

8,740

 Income taxes payable 

29,028

 

43,770

 

6,868

 Amounts due to related parties 

51,007

 

8,772

 

1,377

 Current portion of long-term borrowings 

180,328

 

384,158

 

60,283

 Current portion of finance lease liabilities  

403,843

 

244,032

 

38,294

 Current portion of deferred government grant 

2,074

 

2,074

 

325

 Current portion of bonds payable  

1,943,619

 

-

 

-

 Current portion of operating lease liabilities  

452,272

 

607,997

 

95,408

 Total current liabilities 

6,121,960

 

5,179,995

 

812,854

           

 Non-current liabilities: 

         

 Long-term borrowings 

886,996

 

2,215,015

 

347,584

 Convertible promissory notes 

3,014,057

 

4,266,951

 

669,578

 Non-current portion of finance lease liabilities  

688,128

 

1,119,751

 

175,713

 Unrecognized tax benefits 

68,696

 

77,573

 

12,173

 Deferred tax liabilities 

299,093

 

348,404

 

54,672

 Non-current portion of deferred government grant 

4,100

 

2,294

 

360

 Amounts due to related parties 

747,746

 

-

 

-

 Non-current portion of operating lease liabilities 

645,499

 

2,284,055

 

358,418

 Total non-current liabilities 

6,354,315

 

10,314,043

 

1,618,498

           

 Shareholders' equity 

         

 Treasury stock 

(349,523)

 

(349,523)

 

(54,848)

 Ordinary shares  

56

 

60

 

9

 Additional paid-in capital 

13,083,119

 

15,198,055

 

2,384,906

 Accumulated other comprehensive loss 

(55,535)

 

(90,443)

 

(14,192)

 Statutory reserves 

74,462

 

74,462

 

11,685

 Accumulated deficit 

(7,235,113)

 

(7,590,382)

 

(1,191,097)

 Series A perpetual convertible preferred shares 

1,047,468

 

-

 

-

 Total VNET Group, Inc. shareholders' equity 

6,564,934

 

7,242,229

 

1,136,463

 Noncontrolling interest 

332,546

 

358,772

 

56,299

 Total shareholders' equity 

6,897,480

 

7,601,001

 

1,192,762

 Total liabilities and shareholders' equity 

19,373,755

 

23,095,039

 

3,624,114

           

 

 

 VNET GROUP, INC. 

 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  

 

 Twelve months ended  

 
 

December 31, 2020

September 30, 2021

December 31, 2021

 

December 31, 2020

December 31, 2021

 
 

 RMB 

 

 RMB 

 

 RMB 

 

 US$ 

 

 RMB 

 

 RMB 

 

 US$ 

 
 

 (Unaudited) 

 

 (Unaudited)

 

 (Unaudited) 

 

 (Unaudited) 

 

 (Audited) 

 

 (Unaudited) 

 

 (Unaudited) 

 

 Net revenues 

1,348,367

 

1,560,460

 

1,745,440

 

273,898

 

4,829,019

 

6,189,801

 

971,315

 

 Cost of revenues 

(1,053,942)

 

(1,185,225)

 

(1,365,472)

 

(214,272)

 

(3,753,008)

 

(4,751,771)

 

(745,657)

 

 Gross profit 

294,425

 

375,235

 

379,968

 

59,626

 

1,076,011

 

1,438,030

 

225,658

 
                             

 Operating income (expense) 

                           

 Other operating income 

7,619

 

-

 

-

 

-

 

7,619

 

-

 

-

 

 Sales and marketing 

(88,890)

 

(36,361)

 

(85,474)

 

(13,413)

 

(235,012)

 

(255,400)

 

(40,078)

 

 Research and development 

(42,164)

 

(53,591)

 

(63,037)

 

(9,892)

 

(112,891)

 

(188,489)

 

(29,578)

 

 General and administrative 

(162,869)

 

(161,930)

 

(390,935)

 

(61,346)

 

(535,111)

 

(842,354)

 

(132,184)

 

 Allowance for doubtful debt 

(1,321)

 

(9,451)

 

(1,028)

 

(161)

 

(2,393)

 

(18,399)

 

(2,887)

 

 Impairment of loan receivable to potential investee 

-

 

-

 

9

 

1

 

-

 

(2,807)

 

(440)

 

 Impairment of long-lived assets 

(81,619)

 

-

 

(109,267)

 

(17,146)

 

(81,619)

 

(109,267)

 

(17,146)

 

 Total operating expenses 

(369,244)

 

(261,333)

 

(649,732)

 

(101,957)

 

(959,407)

 

(1,416,716)

 

(222,313)

 
                             

 Operating (loss) profit 

(74,819)

 

113,902

 

(269,764)

 

(42,331)

 

116,604

 

21,314

 

3,345

 

 Interest income 

4,176

 

9,148

 

8,937

 

1,402

 

31,711

 

31,897

 

5,005

 

 Interest expense 

(79,243)

 

(88,013)

 

(75,363)

 

(11,826)

 

(380,609)

 

(334,950)

 

(52,561)

 

 Impairment of long-term investment  

(13,030)

 

(3,495)

 

-

 

-

 

(13,030)

 

(3,495)

 

(548)

 

 Other income 

4,736

 

4,351

 

22,137

 

3,474

 

16,539

 

33,923

 

5,323

 

 Other expenses 

(7,926)

 

(3,908)

 

(3,498)

 

(549)

 

(36,912)

 

(22,700)

 

(3,562)

 

 Changes in the fair value of convertible promissory notes 

(957,105)

 

185,840

 

227,843

 

35,754

 

(2,544,220)

 

829,149

 

130,112

 

 Foreign exchange gain (loss)  

155,496

 

(16,588)

 

82,444

 

12,937

 

228,125

 

110,036

 

17,267

 

 (Loss) gain before income taxes and gain (loss) from equity method investments 

(967,715)

 

201,237

 

(7,264)

 

(1,139)

 

(2,581,792)

 

665,174

 

104,381

 

 Income tax expenses 

(41,210)

 

(29,060)

 

(15,549)

 

(2,440)

 

(109,336)

 

(111,407)

 

(17,482)

 

 Gain (loss) from equity method investments 

15,194

 

(12,027)

 

(1,729)

 

(271)

 

10,869

 

(38,666)

 

(6,068)

 

 Net (loss) profit 

(993,731)

 

160,150

 

(24,542)

 

(3,850)

 

(2,680,259)

 

515,101

 

80,831

 

 Net gain attributable to noncontrolling interest 

(21,647)

 

(3,967)

 

(2,736)

 

(429)

 

(29,088)

 

(15,003)

 

(2,354)

 

 Net (loss) profit attributable to VNET Group, Inc. 

(1,015,378)

 

156,183

 

(27,278)

 

(4,279)

 

(2,709,347)

 

500,098

 

78,477

 

 Deemed distribution to Series A perpetual convertible preferred shareholders 

-

 

-

 

-

 

-

 

(470,643)

 

-

 

-

 

 Net (loss) profit attributable to the Company's ordinary shareholders 

(1,015,378)

 

156,183

 

(27,278)

 

(4,279)

 

(3,179,990)

 

500,098

 

78,477

 
                             

 (Loss) profit per share 

                           

 Basic 

(1.28)

 

0.18

 

(0.03)

 

(0.00)

 

(4.47)

 

0.57

 

0.09

 

 Diluted 

(1.28)

 

(0.03)

 

(0.28)

 

(0.04)

 

(4.47)

 

(0.36)

 

(0.06)

 

 Shares used in (loss) profit per share computation 

                           

 Basic* 

802,963,713

 

863,643,659

 

867,823,835

 

867,823,835

 

716,888,919

 

865,352,554

 

865,352,554

 

 Diluted* 

802,963,713

 

897,643,660

 

901,823,836

 

901,823,836

 

716,888,919

 

911,591,433

 

911,591,433

 
                             

(Loss) profit per ADS (6 ordinary shares equal to 1 ADS)

                           

Basic

(7.68)

 

1.08

 

(0.18)

 

(0.03)

 

(26.82)

 

3.42

 

0.54

 

Diluted

(7.68)

 

(0.18)

 

(1.68)

 

(0.24)

 

(26.82)

 

(2.16)

 

(0.36)

 
                             

 * Shares used in (loss) profit per share/ADS computation were computed under weighted average method. 

                     

 

 

 

 VNET GROUP, INC. 

 RECONCILIATIONS OF GAAP AND NON-GAAP RESULTS  

 (Amount in thousands of Renminbi ("RMB") and US dollars ("US$")) 

                           
 

 Three months ended  

 

 Twelve months ended  

 

December 31, 2020

September 30, 2021

December 31, 2021

 

December 31, 2020

December 31, 2021

 

 RMB 

 

 RMB 

 

 RMB 

 

 US$ 

 

 RMB 

 

 RMB 

 

 US$ 

 Gross profit 

294,425

 

375,235

 

379,968

 

59,626

 

1,076,011

 

1,438,030

 

225,658

 Plus: depreciation and amortization 

277,543

 

297,046

 

329,929

 

51,773

 

901,497

 

1,182,114

 

185,499

 Plus: share-based compensation expenses 

9,882

 

2,211

 

3,932

 

617

 

15,251

 

13,713

 

2,152

 Adjusted cash gross profit 

581,850

 

674,492

 

713,829

 

112,016

 

1,992,759

 

2,633,857

 

413,309

 Adjusted cash gross margin 

43.2%

 

43.2%

 

40.9%

 

40.9%

 

41.3%

 

42.6%

 

42.6%

                           

 Operating expenses 

(369,244)

 

(261,333)

 

(649,732)

 

(101,957)

 

(959,407)

 

(1,416,716)

 

(222,313)

 Plus: share-based compensation expenses 

72,152

 

2,397

 

249,108

 

39,090

 

121,553

 

306,297

 

48,065

 Plus: compensation for postcombination employment in an acquisition 

-

 

14,959

 

17,644

 

2,769

 

-

 

32,603

 

5,116

 Plus: impairment of loan receivable to potential investee 

-

 

-

 

(9)

 

(1)

 

-

 

2,807

 

440

 Plus: impairment of long-lived assets 

81,619

 

-

 

109,267

 

17,146

 

81,619

 

109,267

 

17,146

 Adjusted operating expenses 

(215,473)

 

(243,977)

 

(273,722)

 

(42,953)

 

(756,235)

 

(965,742)

 

(151,546)

                           

 Operating (loss) profit 

(74,819)

 

113,902

 

(269,764)

 

(42,331)

 

116,604

 

21,314

 

3,345

 Plus: depreciation and amortization 

300,917

 

316,951

 

352,784

 

55,360

 

988,983

 

1,267,578

 

198,911

 Plus: share-based compensation expenses 

82,034

 

4,608

 

253,040

 

39,707

 

136,804

 

320,010

 

50,217

 Plus: compensation for postcombination employment in an acquisition 

-

 

14,959

 

17,644

 

2,769

 

-

 

32,603

 

5,116

 Plus: impairment of loan receivable to potential investee 

-

 

-

 

(9)

 

(1)

 

-

 

2,807

 

440

 Plus: impairment of long-lived assets 

81,619

 

-

 

109,267

 

17,146

 

81,619

 

109,267

 

17,146

 Adjusted EBITDA 

389,751

 

450,420

 

462,962

 

72,650

 

1,324,010

 

1,753,579

 

275,175

 Adjusted EBITDA margin 

28.9%

 

28.9%

 

26.5%

 

26.5%

 

27.4%

 

28.3%

 

28.3%

 

 

 VNET GROUP, INC. 

 CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS 

 (Amount in thousands of Renminbi ("RMB") and US dollars ("US$")) 

               
 

 Three months ended  

 

December 31, 2020

 

September 30, 2021

 

December 31, 2021

 

 RMB 

 

 RMB 

 

 RMB 

 

 US$ 

 

 (Unaudited) 

 

 (Unaudited) 

 

 (Unaudited) 

 

 (Unaudited) 

 CASH FLOWS FROM OPERATING ACTIVITIES 

             

 Net (loss) profit 

(993,731)

 

160,150

 

(24,542)

 

(3,850)

 Adjustments to reconcile net (loss) profit to net cash generated from operating activities: 

       

     Depreciation and amortization 

300,917

 

316,951

 

352,784

 

55,360

     Stock-based compensation expenses 

82,034

 

4,608

 

253,040

 

39,707

     Others 

968,802

 

(41,287)

 

(8,128)

 

(1,275)

 Changes in operating assets and liabilities 

             

     Accounts and notes receivable 

35,348

 

(245,169)

 

113,974

 

17,885

     Prepaid expenses and other current assets 

(420,382)

 

(148,754)

 

93,473

 

14,668

     Accounts and notes payable 

(43,339)

 

51,462

 

1,399

 

220

     Accrued expenses and other payables 

(56,107)

 

113,093

 

70,162

 

11,010

     Deferred revenue 

11,252

 

5,183

 

(12,799)

 

(2,008)

     Advances from customers 

413,613

 

8,314

 

53,499

 

8,395

     Others 

(14,576)

 

(89,879)

 

(228,871)

 

(35,915)

 Net cash generated from operating activities 

283,831

 

134,672

 

663,991

 

104,197

               

 CASH FLOWS FROM INVESTING ACTIVITIES 

             

 Purchases of property and equipment 

(772,513)

 

(650,599)

 

(935,772)

 

(146,843)

 Purchases of intangible assets 

(4,932)

 

(8,466)

 

(8,625)

 

(1,353)

 Payments for investments 

(1,522,143)

 

(391,522)

 

(566,460)

 

(88,890)

 (Payments for) proceeds from other investing activities 

(12,426)

 

(442,027)

 

374,013

 

58,691

 Net cash used in investing activities 

(2,312,014)

 

(1,492,614)

 

(1,136,844)

 

(178,395)

               

 CASH FLOWS FROM FINANCING ACTIVITIES 

             

 Proceeds from bank borrowings 

160,996

 

385,364

 

490,815

 

77,020

 Repayment of bank borrowings 

(21,500)

 

(7,469)

 

(141,686)

 

(22,234)

 Payments for finance lease 

(87,749)

 

(129,699)

 

(97,772)

 

(15,343)

 Payment for shares repurchase and cancellation 

(130,472)

 

-

 

-

 

-

 Repayment of 2021 Notes 

-

 

-

 

(1,945,620)

 

(305,310)

 (Payments for) proceeds from other financing activities  

(86,209)

 

8,204

 

(48,644)

 

(7,633)

 Net cash (used in) generated from financing activities 

(164,934)

 

256,400

 

(1,742,907)

 

(273,500)

               

 Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash  

(144,757)

 

11,540

 

(7,255)

 

(1,141)

 Net decrease in cash, cash equivalents and restricted cash 

(2,337,874)

 

(1,090,002)

 

(2,223,015)

 

(348,839)

 Cash, cash equivalents and restricted cash at beginning of period 

5,454,311

 

5,021,490

 

3,931,488

 

616,936

 Cash, cash equivalents and restricted cash at end of period 

3,116,437

 

3,931,488

 

1,708,473

 

268,097

               

 

Cision View original content:https://www.prnewswire.com/news-releases/vnet-reports-unaudited-fourth-quarter-and-full-year-2021-financial-results-301513953.html

SOURCE VNET Group, Inc.