UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of November 2013
Commission File Number: 001-35126
21Vianet Group, Inc.
M5, 1 Jiuxianqiao East Road,
Chaoyang District
Beijing 100016
The People’s Republic of China
(86 10) 8456 2121
(Address, including zip code, and telephone number, including area code, of Registrant’s principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F x Form 40-F ¨
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ¨
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ¨
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| 21Vianet Group, Inc. | ||
| By: | /s/ Shang-Wen Hsiao | |
| Name: | Shang-Wen Hsiao | |
| Title: | Chief Financial Officer | |
Date: November 26, 2013
Exhibit Index
Exhibit 99.1 — Press Release
Exhibit 99.1
21Vianet Group, Inc. Reports Unaudited Third Quarter 2013 Financial Results
3Q13 Net Revenues Up 29.8% YOY to RMB514.0 Million
3Q13 Adjusted EBITDA Up 25.5% YOY to RMB95.4 Million
Live Conference Call to be Held at 8:00 PM U.S. Eastern Time, November 25, 2013
BEIJING, November 25, 2013 (GLOBE NEWSWIRE) — 21Vianet Group, Inc. (Nasdaq: VNET) (“21Vianet” or the “Company”), the largest carrier-neutral internet data center services provider in China, today announced its unaudited financial results for the third quarter of 2013. The Company will hold a conference call at 8:00 p.m. Eastern Time on November 25, 2013. Dial-in details are provided at the end of the release.
Third quarter 2013 Financial Highlights
| • | Net revenues increased by 29.8% to RMB514.0 million (US$84.0 million) from RMB396.1 million in the comparative period in 2012. |
| • | Adjusted EBITDA1 increased by 25.5% to RMB95.4 million (US$15.6 million) from RMB76.0 million in the comparative period in 2012. |
Mr. Josh Chen, Founder, Chairman and Chief Executive Officer of the Company, stated, “During this quarter, we continued to focus on growing our core internet data center business as well as expanding our diversified client offerings, further strengthening our position as China’s leading internet infrastructure provider. We are pleased to add 1,172 cabinets to our self-built data centers this quarter, bringing the total number of cabinets in our self-built data center to 8,576, or 64% of the total 13,307 cabinets under our management. In addition, new initiatives, such as our strategic joint venture with the Dongguan Municipal People’s Government in Guangdong province to build a new internet data center in southern China, will further help us to develop our cloud computing services as well as China’s own interconnection market. These initiatives are expected to further strengthen our position as a leading internet infrastructure and carrier-neutral data center services provider in China. As China’s internet traffic and cloud services continue to grow, we are confident that our business model and on-going initiatives position us well to capitalize on future growth opportunities.”
Mr. Shang-Wen Hsiao, Chief Financial Officer of the Company, commented, “We are pleased with the continued growth in our internet data center related business throughout China. As a result of solid data center demand in China, we increased our total self-built cabinet count by 16% from the second quarter of 2013 while improving our utilization rate to 73.7% from 70.2%. In addition, we are excited about the strong initial interest from potential customers in Microsoft’s Windows Azure and Office 365, which are expected to gradually become a major growth driver alongside our hosting business. Our on-going structural shift to more self-built data centers, as well as our upcoming full commercial launch of our cloud business, will further help improve overall margins over the coming year. With the additional funding from our recent bond offering and the investment from Temasek, we believe we are well-positioned to continue executing our build-out plan for data centers, rollout of our cloud platform with Microsoft, as well as other initiatives that will strengthen our foundation as a leading internet infrastructure company over the long-term.”
Third quarter 2013 Financial Results
REVENUES: Net revenues for the third quarter of 2013 increased by 29.8% to RMB514.0 million (US$84.0 million) from RMB396.1 million in the comparative period in 2012.
Net revenues from hosting and related services increased by 54.3% to RMB337.6 million (US$55.2 million) in the third quarter of 2013 from RMB218.9 million in the comparative period in 2012, primarily due to an increase in the total number of cabinets under management as well as an increase in demand for our CDN services. Net revenues from managed network services decreased by 0.4% to RMB176.4 million (US$28.8 million) in the third quarter of 2013 from RMB177.2 million in the comparative period in 2012, primarily due to a decrease in selling prices as competition intensifies.
GROSS PROFIT: For the third quarter of 2013, gross profit increased by 20.9% to RMB133.4 million (US$21.8 million) from RMB110.4 million in the comparative period in 2012. Gross margin for the third quarter of 2013 was 26.0%, compared with 27.9% in the comparative period in 2012 and 26.1% in the second quarter of 2013. The decrease in gross margin was primarily due to an increase in cost of revenues, resulting from increased depreciation for the Company’s self-built data centers.
Adjusted gross profit, which excludes share-based compensation expenses and amortization of intangible assets derived from acquisitions, increased by 25.2% to RMB148.7 million (US$24.3 million) from RMB118.7 million in the comparative period in 2012. Adjusted gross margin was 28.9% in the third quarter of 2013, compared with 30.0% in the comparative period in 2012 and 28.8% in the second quarter of 2013.
OPERATING EXPENSES: Total operating expenses were RMB118.0 million (US$19.3 million), compared with RMB102.3 million in the comparative period in 2012.
Sales and marketing expenses increased to RMB38.9 million (US$6.4 million) from RMB28.9 million in the comparative period in 2012, primarily due to the expansion of the Company’s sales and service support team and the Company’s marketing efforts associated with the launch of Microsoft’s premier cloud services.
General and administrative expenses increased to RMB47.0 million (US$7.7 million) from RMB42.6 million in the comparative period in 2012, primarily due to an increase in headcount, office rentals and other expansion-related expenses associated with the Company’s efforts to expand its cloud computing service offering.
Research and development expenses increased to RMB21.4 million (US$3.5 million) from RMB18.8 million in the comparative period in 2012, which reflected the Company’s efforts to further strengthen its research and development capabilities and expand its cloud computing service offerings.
Change in the fair value of contingent purchase consideration payable was a loss of RMB10.7 million (US$1.8 million) in the third quarter of 2013, compared with a loss in the change in fair value of contingent purchase consideration payable of RMB12.0 million in the prior year period. This non-cash loss was primarily due to an increase in the market value of the Company’s shares, which resulted in an increase in the fair value of share-based contingent purchase considerations payable as of September 30, 2013 associated with the Company’s past acquisitions.
Adjusted operating expenses, which exclude share-based compensation expenses and the changes in the fair value of contingent purchase consideration payable, increased to RMB91.7 million (US$15.0 million) from RMB68.8 million in the comparative period in 2012. As a percentage of net revenue, adjusted operating expenses were 17.8%, compared with 17.4% in the comparative period in 2012 and 18.2% in the second quarter of 2013. The decrease in adjusted operating expense as a percentage of net revenue from the second of quarter of 2013 was mainly due to increase of operation efficiency.
ADJUSTED EBITDA: Adjusted EBITDA for the third quarter of 2013 increased by 25.5% to RMB95.4 million (US$15.6 million) from RMB76.0 million in the comparative period in 2012. Adjusted EBITDA margin for the quarter was 18.6%, compared with 19.2% in the comparative period in 2012 and 18.5% in the second quarter of 2013. Adjusted EBITDA in the third quarter of 2013 excludes share-based compensation expenses of RMB18.5 million (US$3.0 million) and changes in the fair value of contingent purchase consideration payable of RMB10.7 million (US$1.8 million).
NET PROFIT/LOSS: Net loss for the third quarter of 2013 was RMB12.9 million (US$2.1 million), compared to a net profit of RMB12.2 million in the comparative period in 2012. The decrease in net profit was mainly due to an increase in interest expense associated with the bond offering.
Adjusted net profit for the third quarter of 2013 was RMB29.5 million (US$4.8 million), compared with RMB52.2 million in the comparative period in 2012. Adjusted net profit in the third quarter of 2013 excludes share-based compensation expenses of RMB18.5 million (US$3.0 million), amortization of intangible assets derived from acquisitions of RMB12.3 million (US$2.0 million), and changes in the fair value of contingent purchase consideration payable and related deferred tax impact of RMB11.5 million (US$1.9 million) in the aggregate. Adjusted net margin was 5.7%, compared to 13.2% in the comparative period in 2012 and 4.0% in the second quarter of 2013.
EARNING/LOSS PER SHARE: Diluted loss per ordinary share for the third quarter of 2013 was RMB0.04, which represents the equivalent of RMB0.24 (US$0.04) per American Depositary Share (“ADS”). Each ADS represents six ordinary shares. Adjusted diluted earnings per share for the third quarter of 2013 was RMB0.08, which represents the equivalent of RMB0.48 (US$0.08) per ADS. Adjusted earnings per share is calculated using adjusted net profit as discussed above to divide the weighted average shares number.
As of September 30, 2013, the Company had a total of 357.7 million ordinary shares outstanding, or the equivalent of 59.6 million ADSs.
BALANCE SHEET: As of September 30, 2013, the Company’s cash and cash equivalents and short-term investment were RMB2.2 billion (US$362.9 million).
Third quarter 2013 Operational Highlights
| • | Monthly Recurring Revenues (“MRR”) per cabinet was RMB10,520 in the third quarter of 2013, compared to RMB10,559 in the second quarter of 2013. |
| • | Total cabinets under management increased to 13,307 as of September 30, 2013, from 12,226 as of June 30, 2012, with 8,576 cabinets in the Company’s self-built data centers and 4,731 cabinets in its partnered data centers. |
| • | Utilization rate increased to 73.7% in the third quarter of 2013, compared to 70.2% in the second quarter of 2013. |
| • | Churn rate was 1.64% in the third quarter of 2013, compared to 1.47% in the second quarter of 2013. Top 20 customers’ churn rate remained 0%. |
Financial Outlook
For the fourth quarter of 2013, the Company expects net revenues to be in the range of RMB540 million (US$88 million) to RMB550 million (US$90 million), this represents a 30.4% growth in the comparative period in 2012. Adjusted EBITDA is expected to be in the range of RMB100 million (US$16 million) to RMB105 million (US$17 million). These forecasts reflect the Company’s current and preliminary view, which is subject to change.
Conference Call
The Company will hold a conference call on Monday, November 25, 2013 at 8:00 pm Eastern Time, or Tuesday, November 26, 2013 at 9:00 am Beijing Time to discuss the financial results.
Participants may access the call by dialing the following numbers:
| United States: | +1-845-675-0438 | |
| International Toll Free: | +1-855-500-8701 | |
| China Domestic: | 400-1200654 | |
| Hong Kong: | +852-3051-2745 | |
| Conference ID: | #97383626 |
The replay will be accessible through December 2, 2013 by dialing the following numbers:
| United States Toll Free: | +1- 855-452-5696 | |
| International: | +61-2-8199-0299 | |
| Conference ID: | #97383626 |
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 SEC as supplemental measure to review and assess its operating performance: adjusted gross profit, adjusted gross margin, adjusted operating expenses, adjusted net profit, adjusted net margin, adjusted EBITDA, adjusted EBITDA margin, adjusted basic earnings per share, adjusted diluted earnings per share, adjusted basic earnings per ADS and adjusted diluted earnings per ADS. 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 press release contains translations of certain Renminbi amounts into U.S. dollars at specified rates solely for the convenience of readers. Unless otherwise noted, all translations from Renminbi to U.S. dollars, in this press release, were made at a rate of RMB6.1200 to US$1.00, the noon buying rate in effect on September 30, 2013 in the City of New York for cable transfers in Renminbi per U.S. dollar as certified for customs purposes by the Federal Reserve Bank of New York.
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
21Vianet Group, Inc. is the largest carrier-neutral internet data center services provider in China. 21Vianet provides hosting and related services, managed network services, cloud infrastructure services, and content delivery network services, improving the reliability, security and speed of its customers’ internet infrastructure. Customers may locate their servers and networking equipment in 21Vianet’s data centers and connect to China’s internet backbone through 21Vianet’s extensive fiber optic network. In addition, 21Vianet’s proprietary smart routing technology enables customers’ data to be delivered across the internet in a faster and more reliable manner. 21Vianet operates in 44 cities throughout China, servicing a diversified and loyal base of more than 2,000 customers that span many 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,” “believes,” “estimates” and similar statements. Among other things, the outlook for the fourth quarter of 2013 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 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 21Vianet’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: 21Vianet’s goals and strategies; 21Vianet’s expansion plans; the expected growth of the data center services market; expectations regarding demand for, and market acceptance of, 21Vianet’s services; 21Vianet’s expectations regarding keeping and strengthening its relationships with customers; 21Vianet’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 21Vianet provides solutions and services. Further information regarding these and other risks is included in 21Vianet’s reports filed with, or furnished to the 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 21Vianet undertakes no duty to update such information, except as required under applicable law.
| 1 | We define adjusted EBITDA as EBITDA excluding share-based compensation expenses and changes in the fair value of contingent purchase consideration payable and EBITDA 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. |
| CONTACT: | Investor Relations Contact: | |
| 21Vianet Group, Inc. | ||
| Joseph Cheng | ||
| +86 10 8456 2121 | ||
| IR@21Vianet.com | ||
| ICR, Inc. | ||
| Jeremy Peruski | ||
| +1 (646) 405-4922 | ||
| IR@21Vianet.com | ||
Source: 21Vianet Group, Inc.
21VIANET GROUP, INC.
CONSOLIDATED BALANCE SHEETS
(Amount in thousands of Renminbi (“RMB”) and US dollars (“US$”))
| As of | As of | |||||||||||
| December 31, 2012 | September 30, 2013 | |||||||||||
| RMB | RMB | US$ | ||||||||||
| (Audited) | (Unaudited) | (Unaudited) | ||||||||||
| Assets |
||||||||||||
| Current assets: |
||||||||||||
| Cash and cash equivalents |
432,254 | 1,381,228 | 225,691 | |||||||||
| Restricted cash |
191,766 | 235,727 | 38,517 | |||||||||
| Accounts receivable, net |
293,369 | 550,148 | 89,893 | |||||||||
| Short-term investments |
222,701 | 840,000 | 137,255 | |||||||||
| Prepaid expenses and other current assets |
95,756 | 125,396 | 20,490 | |||||||||
| Deferred tax assets |
8,585 | 9,675 | 1,581 | |||||||||
| Amount due from related parties |
18,726 | 59,488 | 9,720 | |||||||||
|
|
|
|
|
|
|
|||||||
| Total current assets |
1,263,157 | 3,201,662 | 523,147 | |||||||||
| Non-current assets: |
||||||||||||
| Property and equipment, net |
822,707 | 1,294,386 | 211,501 | |||||||||
| Intangible assets, net |
303,909 | 350,495 | 57,270 | |||||||||
| Deferred tax assets |
11,231 | 13,106 | 2,142 | |||||||||
| Goodwill |
296,688 | 413,500 | 67,565 | |||||||||
| Investment |
57,599 | 56,342 | 9,206 | |||||||||
| Restricted cash |
221,628 | 220,061 | 35,958 | |||||||||
| Other assets |
— | 12,957 | 2,117 | |||||||||
|
|
|
|
|
|
|
|||||||
| Total non-current assets |
1,713,762 | 2,360,847 | 385,759 | |||||||||
|
|
|
|
|
|
|
|||||||
| Total assets |
2,976,919 | 5,562,509 | 908,906 | |||||||||
|
|
|
|
|
|
|
|||||||
| Liabilities and Shareholders’ Equity |
||||||||||||
| Current liabilities: |
||||||||||||
| Short-term bank borrowings |
176,961 | 159,481 | 26,059 | |||||||||
| Accounts payable |
109,571 | 195,424 | 31,932 | |||||||||
| Accrued expenses and other payables |
167,498 | 294,489 | 48,118 | |||||||||
| Advances from customers |
22,976 | 25,097 | 4,101 | |||||||||
| Income taxes payable |
23,506 | 21,603 | 3,530 | |||||||||
| Amounts due to related parties |
105,037 | 226,145 | 36,952 | |||||||||
| Current portion of long-term bank borrowings |
167,879 | 189,000 | 30,882 | |||||||||
| Current portion of capital lease obligations |
36,719 | 36,994 | 6,045 | |||||||||
|
|
|
|
|
|
|
|||||||
| 810,147 | 1,148,233 | 187,619 | ||||||||||
| Non-current liabilities: |
||||||||||||
| Long-term bank borrowings |
63,000 | 976,740 | 159,598 | |||||||||
| Amounts due to related parties |
86,316 | 75,096 | 12,271 | |||||||||
| Non-current portion of capital lease obligations |
52,352 | 310,062 | 50,664 | |||||||||
| Unrecognized tax benefits |
12,340 | 13,824 | 2,259 | |||||||||
| Deferred tax liabilities |
44,666 | 80,889 | 13,217 | |||||||||
| Deferred government grant |
18,793 | 16,763 | 2,739 | |||||||||
| Bonds payable |
— | 969,863 | 158,474 | |||||||||
| Other non-current liability |
— | 100,000 | 16,340 | |||||||||
|
|
|
|
|
|
|
|||||||
| Total non-current liabilities |
277,467 | 2,543,237 | 415,562 | |||||||||
| Shareholders’ equity |
||||||||||||
| Treasury stock |
(20,702 | ) | (41,124 | ) | (6,720 | ) | ||||||
| Ordinary shares |
23 | 24 | 4 | |||||||||
| Additional paid-in capital |
3,294,855 | 3,362,833 | 549,483 | |||||||||
| Accumulated other comprehensive loss |
(57,367 | ) | (76,630 | ) | (12,521 | ) | ||||||
| Statutory reserves |
25,871 | 25,871 | 4,227 | |||||||||
| Accumulated deficit |
(1,371,877 | ) | (1,415,796 | ) | (231,340 | ) | ||||||
|
|
|
|
|
|
|
|||||||
| Total 21Vianet Group, Inc. shareholders’ equity |
1,870,803 | 1,855,178 | 303,133 | |||||||||
| Non-controlling interest |
18,502 | 15,861 | 2,592 | |||||||||
|
|
|
|
|
|
|
|||||||
| Total shareholders’ equity |
1,889,305 | 1,871,039 | 305,725 | |||||||||
|
|
|
|
|
|
|
|||||||
| Total liabilities and shareholders’ equity |
2,976,919 | 5,562,509 | 908,906 | |||||||||
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|
|
|
|
|
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21VIANET GROUP, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Amount in thousands of Renminbi (“RMB”) and US dollars (“US$”) except for number of shares and per share data)
| Three months ended | Nine months ended September 30 | |||||||||||||||||||||||||||
| September 30, 2012 | June 30, 2013 | September 30, 2013 | 2012 | 2013 | ||||||||||||||||||||||||
| RMB | RMB | RMB | US$ | RMB | RMB | US$ | ||||||||||||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||||||||||||
| Net revenues |
||||||||||||||||||||||||||||
| Hosting and related services |
218,861 | 292,983 | 337,618 | 55,166 | 613,440 | 895,303 | 146,291 | |||||||||||||||||||||
| Managed network services |
177,198 | 178,118 | 176,402 | 28,824 | 492,900 | 525,537 | 85,872 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total net revenues |
396,059 | 471,101 | 514,020 | 83,990 | 1,106,340 | 1,420,840 | 232,163 | |||||||||||||||||||||
| Cost of revenues |
(285,662 | ) | (347,962 | ) | (380,597 | ) | (62,189 | ) | (794,397 | ) | (1,048,201 | ) | (171,275 | ) | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Gross profit |
110,397 | 123,139 | 133,423 | 21,801 | 311,943 | 372,639 | 60,888 | |||||||||||||||||||||
| Operating expenses |
||||||||||||||||||||||||||||
| Sales and marketing |
(28,885 | ) | (36,885 | ) | (38,878 | ) | (6,353 | ) | (78,295 | ) | (106,141 | ) | (17,343 | ) | ||||||||||||||
| General and administrative |
(42,622 | ) | (40,091 | ) | (46,965 | ) | (7,674 | ) | (104,125 | ) | (132,342 | ) | (21,625 | ) | ||||||||||||||
| Research and development |
(18,758 | ) | (19,459 | ) | (21,421 | ) | (3,500 | ) | (46,605 | ) | (56,782 | ) | (9,278 | ) | ||||||||||||||
| Changes in the fair value of contingent purchase consideration payable |
(12,043 | ) | (40,309 | ) | (10,719 | ) | (1,751 | ) | (57,492 | ) | (48,694 | ) | (7,957 | ) | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total operating expenses |
(102,308 | ) | (136,744 | ) | (117,983 | ) | (19,278 | ) | (286,517 | ) | (343,959 | ) | (56,203 | ) | ||||||||||||||
|
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|
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|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Operating profit (loss) |
8,089 | (13,605 | ) | 15,440 | 2,523 | 25,426 | 28,680 | 4,685 | ||||||||||||||||||||
| Interest income |
4,216 | 11,090 | 10,497 | 1,715 | 10,442 | 26,511 | 4,332 | |||||||||||||||||||||
| Interest expense |
(1,592 | ) | (37,625 | ) | (40,123 | ) | (6,556 | ) | (5,391 | ) | (89,720 | ) | (14,660 | ) | ||||||||||||||
| Gain (loss) from equity method investment |
29 | (250 | ) | (505 | ) | (83 | ) | 29 | (1,256 | ) | (205 | ) | ||||||||||||||||
| Other income |
11,209 | 617 | 216 | 35 | 11,616 | 1,681 | 275 | |||||||||||||||||||||
| Other expense |
(107 | ) | (672 | ) | (43 | ) | (7 | ) | (500 | ) | (2,031 | ) | (332 | ) | ||||||||||||||
| Foreign exchange (loss) gain |
(1,213 | ) | 7,070 | 3,119 | 510 | (5,729 | ) | 11,819 | 1,931 | |||||||||||||||||||
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|
|
|
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|
|
|
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|
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|
|||||||||||||||
| Profit (loss) before income taxes |
20,631 | (33,375 | ) | (11,399 | ) | (1,863 | ) | 35,893 | (24,316 | ) | (3,974 | ) | ||||||||||||||||
| Income tax expense |
(8,417 | ) | (8,891 | ) | (1,463 | ) | (239 | ) | (21,371 | ) | (18,768 | ) | (3,067 | ) | ||||||||||||||
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|
|||||||||||||||
| Consolidated net income (loss) |
12,214 | (42,266 | ) | (12,862 | ) | (2,102 | ) | 14,522 | (43,084 | ) | (7,041 | ) | ||||||||||||||||
| Net income attributable to non-controlling interest |
(363 | ) | (334 | ) | (347 | ) | (57 | ) | (935 | ) | (835 | ) | (136 | ) | ||||||||||||||
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| Net income (loss) attributable to ordinary shareholders |
11,851 | (42,600 | ) | (13,209 | ) | (2,159 | ) | 13,587 | (43,919 | ) | (7,177 | ) | ||||||||||||||||
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| Earnings(loss) per share |
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| Basic |
0.03 | (0.12 | ) | (0.04 | ) | (0.01 | ) | 0.04 | (0.12 | ) | (0.02 | ) | ||||||||||||||||
| Diluted |
0.03 | (0.12 | ) | (0.04 | ) | (0.01 | ) | 0.04 | (0.12 | ) | (0.02 | ) | ||||||||||||||||
| Shares used in earnings per share computation |
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| Basic* |
340,885,136 | 355,050,686 | 356,606,277 | 356,606,277 | 341,971,679 | 354,929,078 | 354,078,056 | |||||||||||||||||||||
| Diluted* |
352,729,739 | 367,643,592 | 373,910,204 | 373,910,204 | 353,994,266 | 368,740,566 | 368,740,566 | |||||||||||||||||||||
| Earnings(loss) per ADS (6 ordinary shares equal to 1 ADS) |
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| EPS - Basic |
0.18 | (0.72 | ) | (0.24 | ) | (0.04 | ) | 0.06 | (0.72 | ) | (0.12 | ) | ||||||||||||||||
| EPS - Diluted |
0.18 | (0.72 | ) | (0.24 | ) | (0.04 | ) | 0.06 | (0.72 | ) | (0.12 | ) | ||||||||||||||||
| * | Shares used earnings per share/ADS computation were computed under weighted average method. |
21VIANET GROUP, INC.
RECONCILIATIONS OF GAAP AND NON-GAAP RESULTS
(Amount in thousands of Renminbi (“RMB”) and US dollars (“US$”) except for number of shares and per share data)
| Three months ended | Nine months ended September 30 | |||||||||||||||||||||||||||
| September 30, 2012 | June 30, 2013 | September 30, 2013 | 2012 | 2013 | ||||||||||||||||||||||||
| RMB | RMB | RMB | US$ | RMB | RMB | US$ | ||||||||||||||||||||||
| Gross profit |
110,397 | 123,139 | 133,423 | 21,801 | 311,943 | 372,639 | 60,888 | |||||||||||||||||||||
| Plus: share-based compensation expense |
1,513 | 1,116 | 2,917 | 477 | 2,987 | 5,437 | 888 | |||||||||||||||||||||
| Plus: amortization of intangible assets derived from acquisitions |
6,788 | 11,589 | 12,314 | 2,012 | 19,133 | 32,063 | 5,239 | |||||||||||||||||||||
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| Adjusted gross profit |
118,698 | 135,844 | 148,654 | 24,290 | 334,063 | 410,139 | 67,015 | |||||||||||||||||||||
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| Adjusted gross margin |
30.0 | % | 28.8 | % | 28.9 | % | 28.9 | % | 30.2 | % | 28.9 | % | 28.9 | % | ||||||||||||||
| Operating expenses |
(102,308 | ) | (136,744 | ) | (117,983 | ) | (19,278 | ) | (286,517 | ) | (343,959 | ) | (56,203 | ) | ||||||||||||||
| Plus: share-based compensation expense |
21,462 | 10,523 | 15,612 | 2,551 | 42,279 | 37,729 | 6,165 | |||||||||||||||||||||
| Plus: changes in the fair value of contingent purchase consideration payable |
12,043 | 40,309 | 10,719 | 1,751 | 57,492 | 48,694 | 7,957 | |||||||||||||||||||||
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| Adjusted operating expenses |
(68,803 | ) | (85,912 | ) | (91,652 | ) | (14,976 | ) | (186,746 | ) | (257,536 | ) | (42,081 | ) | ||||||||||||||
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| Net profit (loss) |
12,214 | (42,266 | ) | (12,862 | ) | (2,102 | ) | 14,522 | (43,084 | ) | (7,041 | ) | ||||||||||||||||
| Plus: share-based compensation expense |
22,975 | 11,639 | 18,529 | 3,028 | 45,266 | 43,166 | 7,053 | |||||||||||||||||||||
| Plus: amortization of intangible assets derived from acquisitions |
6,788 | 11,589 | 12,314 | 2,012 | 19,133 | 32,063 | 5,239 | |||||||||||||||||||||
| Plus: changes in the fair value of contingent purchase consideration payable and related deferred tax impact |
10,237 | 37,886 | 11,541 | 1,886 | 48,868 | 47,310 | 7,730 | |||||||||||||||||||||
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| Adjusted net profit |
52,214 | 18,848 | 29,522 | 4,824 | 127,789 | 79,455 | 12,981 | |||||||||||||||||||||
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| Adjusted net margin |
13.2 | % | 4.0 | % | 5.7 | % | 5.7 | % | 11.6 | % | 5.6 | % | 5.6 | % | ||||||||||||||
| Net profit (loss) |
12,214 | (42,266 | ) | (12,862 | ) | (2,102 | ) | 14,522 | (43,084 | ) | (7,041 | ) | ||||||||||||||||
| Minus: Provision for income taxes |
(8,417 | ) | (8,891 | ) | (1,463 | ) | (239 | ) | (21,371 | ) | (18,768 | ) | (3,067 | ) | ||||||||||||||
| Minus: Interest income |
4,216 | 11,090 | 10,497 | 1,715 | 10,442 | 26,511 | 4,332 | |||||||||||||||||||||
| Minus: Interest expenses |
(1,592 | ) | (37,625 | ) | (40,123 | ) | (6,556 | ) | (5,391 | ) | (89,720 | ) | (14,660 | ) | ||||||||||||||
| Minus: Exchange gain/loss |
(1,213 | ) | 7,070 | 3,119 | 510 | (5,729 | ) | 11,819 | 1,931 | |||||||||||||||||||
| Minus: Gain (loss) from equity method investment |
29 | (250 | ) | (505 | ) | (83 | ) | 29 | (1,256 | ) | (205 | ) | ||||||||||||||||
| Minus: Other income |
11,209 | 617 | 216 | 35 | 11,616 | 1,681 | 275 | |||||||||||||||||||||
| Minus: Other expenses |
(107 | ) | (672 | ) | (43 | ) | (7 | ) | (500 | ) | (2,031 | ) | (332 | ) | ||||||||||||||
| Plus: depreciation |
23,724 | 33,971 | 35,101 | 5,735 | 63,218 | 100,328 | 16,393 | |||||||||||||||||||||
| Plus: amortization |
9,176 | 14,881 | 15,636 | 2,555 | 24,492 | 41,894 | 6,845 | |||||||||||||||||||||
| Plus: share-based compensation expense |
22,975 | 11,639 | 18,529 | 3,028 | 45,266 | 43,166 | 7,053 | |||||||||||||||||||||
| Plus: changes in the fair value of contingent purchase consideration payable |
12,043 | 40,309 | 10,719 | 1,751 | 57,492 | 48,694 | 7,957 | |||||||||||||||||||||
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| Adjusted EBITDA |
76,007 | 87,195 | 95,425 | 15,592 | 215,894 | 262,762 | 42,933 | |||||||||||||||||||||
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| Adjusted EBITDA margin |
19.2 | % | 18.5 | % | 18.6 | % | 18.6 | % | 19.5 | % | 18.5 | % | 18.5 | % | ||||||||||||||
| Adjusted net profit |
52,214 | 18,848 | 29,522 | 4,824 | 127,789 | 79,455 | 12,981 | |||||||||||||||||||||
| Less: Net income attributable to non-controlling interest |
(363 | ) | (334 | ) | (347 | ) | (57 | ) | (935 | ) | (835 | ) | (136 | ) | ||||||||||||||
| Adjusted net profit attributable to the Company’s ordinary shareholders |
51,851 | 18,514 | 29,175 | 4,767 | 126,854 | 78,620 | 12,845 | |||||||||||||||||||||
| Adjusted earnings per share |
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| Basic |
0.15 | 0.05 | 0.08 | 0.01 | 0.37 | 0.22 | 0.04 | |||||||||||||||||||||
| Diluted |
0.15 | 0.05 | 0.08 | 0.01 | 0.36 | 0.21 | 0.03 | |||||||||||||||||||||
| Shares used in adjusted earnings per share computation: |
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| Basic* |
340,885,136 | 355,050,686 | 356,606,277 | 356,606,277 | 341,971,679 | 354,929,078 | 354,929,078 | |||||||||||||||||||||
| Diluted* |
352,729,739 | 367,643,592 | 373,910,204 | 373,910,204 | 353,994,266 | 368,740,566 | 368,740,566 | |||||||||||||||||||||
| Earnings per ADS (6 ordinary shares equal to 1 ADS) |
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| EPS - Basic |
0.90 | 0.30 | 0.48 | 0.08 | 2.22 | 1.32 | 0.22 | |||||||||||||||||||||
| EPS - Diluted |
0.90 | 0.30 | 0.48 | 0.08 | 2.16 | 1.26 | 0.21 | |||||||||||||||||||||
| * | Shares used in adjusted earnings/ADS per share computation were computed under weighted average method. |