BEIJING, March 29, 2019 /PRNewswire/ -- LightInTheBox
Holding Co., Ltd. (NYSE: LITB) ("LightInTheBox" or the
"Company"), a cross-border e-commerce platform that delivers
products directly to consumers around the world, today announced
its unaudited financial results for the fourth quarter ended
December 31, 2018.
Fourth Quarter 2018 Highlights
- The Company generated positive cash flow with cash and cash equivalents of
$38.8 million as of December 31, 2018, a slight increase from
$37.5 million as of September 30, 2018.
- Gross margin improved to 34.6% from 29.7% during the same
period last year.
- Loss from operations decreased significantly to $1.7 million, from $3.6
million in the same period last year.
"I am very pleased with the progress we made during the quarter
in integrating ezbuy and LightInTheBox to improve efficiency and
fully leverage the synergies created by both businesses," commented
Mr. Jian He, Chief Executive Officer
of LightInTheBox. "We began implementing a number of initiatives
during the quarter including shifting our focus towards generating
sales in categories with higher gross margins, launching more
targeted and efficient marketing campaigns during the holiday sales
period, and improving inventory turnover. These initiatives had an
immediate positive impact on our financials which I believe
indicates the direction we are headed in. While net revenues
decreased by 37% year-over-year during the quarter, our gross
margin improved to 34.6%, and we generated positive cash flow which
resulted in cash and cash equivalents increasing slightly to
$39.8 million. Our loss from
operations also narrowed to $1.7
million. These initial results are encouraging and I'm
confident that we have the right strategy in place turn this
business around and regain growth momentum."
Fourth Quarter 2018 Financial Results
Net revenues decreased 37.2% year-over-year to
$57.5 million from $91.6 million in the same quarter of 2017. Net
revenues from product sales were $55.4
million, compared with $83.1
million in the same quarter of 2017. Net revenues from
service and others were $2.1 million,
compared with $8.5 million in the
same quarter of 2017. As a percentage of net revenues, service and
others accounted for 3.6% during the fourth quarter of 2018.
Total orders of product sales were 1.3 million for the fourth
quarter of 2018, compared with 1.7 million in the same quarter of
2017. Total number of customers for product sales was 1.0 million
for the fourth quarter of 2018, compared with 1.4 million in the
same quarter of 2017.
Product sales in the apparel category were $20.3 million for the fourth quarter of 2018,
compared with $25.3 million in the
same quarter of 2017. As a percentage of product sales, apparel
revenues accounted for 36.6% for the fourth quarter of 2018,
compared with 30.4% in the same quarter of 2017. Product sales from
other general merchandise were $35.1
million for the fourth quarter of 2018.
Product sales in Europe were
$29.7 million for the fourth quarter
of 2018, compared with $44.5 million
in the same quarter of 2017, representing 53.6% of total product
sales for the fourth quarter of 2018. Product sales in North America were $16.0 million, compared with $19.0 million in the same quarter of 2017,
representing 28.8% of total product sales for the fourth quarter of
2018. Product sales in Gulf Cooperation Council ("GCC") countries
were $0.9 million for the fourth
quarter of 2018, compared with $1.1
million in the same quarter of 2017, representing 1.5% of
total product sales for the fourth quarter of 2018, while product
sales in other countries were $8.8
million, representing 16.1% of total product sales for the
same quarter.
With the Company's focus now shifting away from geographic
markets and towards generating sales in categories with higher
quality products and gross margins, starting during the first
quarter of 2019, LightInTheBox will no longer be providing a
geographic breakdown of product sales.
Total cost of revenues was $37.6
million in the fourth quarter of 2018, compared with
$64.4 million in the same period of
2017. Cost for product sales was $36.0
million in the fourth quarter of 2018, compared with
$56.7 million in the same period of
2017. Cost for service and others was $1.6
million in the fourth quarter of 2018, compared with
$7.7 million in the same period of
2017.
Gross profit for the fourth quarter of 2018 was
$19.9 million, compared with
$27.2 million in the same period of
2017. Gross margin was 34.6% in the fourth quarter of 2018,
compared with 29.7% in the same quarter of 2017.
Total operating expenses in the fourth quarter of 2018
were $21.6 million, compared with
$30.8 million in the same quarter of
2017.
- Fulfillment expenses in the fourth quarter of 2018 were
$3.5 million, compared with
$5.0 million in the same quarter of
2017. As a percentage of total net revenues, fulfillment expenses
were 6.2% for the fourth quarter of 2018, compared to 5.5% in the
same quarter of 2017 and 7.6% in the third quarter of 2018.
- Selling and marketing expenses in the fourth quarter of
2018 were $11.9 million, compared
with $17.8 million in the same
quarter of 2017. As a percentage of total net revenues, selling and
marketing expenses were 20.5% for the fourth quarter of 2018,
compared to 19.4% in the same quarter of 2017 and 25.4% in the
third quarter of 2018.
- General and administrative (G&A) expenses in the
fourth quarter of 2018 were $6.2
million, compared with $8.0
million in the same quarter of 2017. As a percentage of
total net revenues, G&A expenses were 10.8% for the fourth
quarter of 2018, compared with 8.7% in the same quarter of 2017 and
22.7% in the third quarter of 2018. G&A expenses in the fourth
quarter of 2018 included $2.2 million
in technology investments, compared with $2.7 million in the same quarter of 2017.
Loss from operations was $1.7
million in the fourth quarter of 2018, compared with a loss
from operations of $3.6 million in
the same quarter of 2017.
Net loss was $24.4 million
in the fourth quarter of 2018, compared with a net loss of
$3.5 million in the same quarter of
2017. The increase in net loss was mainly due to the change in fair
value of convertible promissory note issued on December 10, 2018 for acquiring total issued
share capital of Ezbuy Holding Co., Ltd. ("ezbuy"). The net loss
due to the change in fair value of the note between the acquisition
date and December 31, 2018 was
$22.8 million.
Net loss per ADS was $0.37
in the fourth quarter of 2018, compared with net loss per ADS of
$0.05 in the same quarter of 2017.
Each ADS represents two ordinary shares.
For the fourth quarter of 2018, the Company's weighted average
number of ADSs used in computing the loss per ADS was
66,692,812.
As of December 31, 2018, the
Company had cash and cash equivalents and restricted cash of
$39.8 million, compared with
$38.3 million as of September 30, 2018.
Full Year 2018 Financial Results
Net revenues decreased 28.9% year-over-year to
$227.5 million from $319.9 million in 2017. Net revenues from product
sales were $216.4 million, compared
with $294.0 million in 2017. Net
revenues from service and others were $11.1
million, compared with $25.9
million in 2017. As a percentage of net revenues, service
and others accounted for 4.9% in 2018.
Total orders of product sales were 4.9 million for the full year
of 2018, compared with 6.7 million in 2017. Total number of
customers for product sales was 2.9 million for the full year of
2018, compared with 4.9 million in 2017.
Product sales in the apparel category were $73.4 million for the full year of 2018, compared
with $99.2 million in 2017. As a
percentage of product sales, apparel revenues accounted for 33.9%
for the full year of 2018, compared with 33.7% in 2017. Product
sales from other general merchandise were $143.0 million for the full year of 2018.
Product sales in Europe were
$109.8 million for the full year of
2018, compared with $153.7 million in
2017, representing 50.7% of total product sales for the full year
of 2018. Product sales in North
America were $51.2 million,
compared with $73.3 million in 2017,
representing 23.7% of total product sales for the full year of
2018.Product sales in Gulf Cooperation Council ("GCC") countries
were $9.4 million for the full year
of 2018, compared with $2.0 million
in 2017, representing 4.4% of total product sales for the full year
of 2018,while product sales in other countries were $46.0 million, representing 21.2% of total
product sales for the full year of 2018.
Total cost of revenues was $166.3
million in the full year of 2018, compared with $214.3 million in 2017. Cost for product sales
was $156.4 million in the full year
of 2018, compared with $189.9 million
in 2017. Cost for service and others was $9.9 million in the full year of 2018, compared
with $24.4 million in 2017.
Gross profit for the full year of 2018 was $61.2 million, compared with $105.6 million in 2017. Gross margin was 26.9% in
the full year of 2018, compared with 33.0% in 2017.
Total operating expenses in the full year of 2018 were
$98.7 million, compared with
$115.8 million in 2017.
- Fulfillment expenses in the full year of 2018 were
$15.1 million, compared with
$17.3 million in 2017. As a
percentage of total net revenues, fulfillment expenses were 6.6%
for the full year of 2018, compared to 5.4% in 2017.
- Selling and marketing expenses in the full year of 2018
were $50.6 million, compared with
$68.9 million in 2017. As a
percentage of total net revenues, selling and marketing expenses
were 22.2% for the full year of 2018, compared to 21.5% in
2017.
- General and administrative (G&A) expenses in the
full year of 2018 were $33.0 million,
compared with $29.6 million in 2017.
As a percentage of total net revenues, G&A expenses were 14.5%
for the full year of 2018, compared with 9.3% in 2017. G&A
expenses in the full year of 2018 included $10.6 million in technology investments, compared
with $10.4 million in 2017.
Loss from operations was $37.5
million in the full year of 2018, compared with a loss from
operations of $10.2 million in
2017.
Net loss was $59.6 million
in the full year of 2018, compared with a net loss of $9.5 million in 2017. The increase in net loss
was partially due to the change in fair value of convertible
promissory note issued on December 10,
2018 for acquiring total issued share capital of Ezbuy
Holding Co., Ltd. ("ezbuy"). The net loss due to the change in fair
value of the note between the acquisition date and December 31, 2018 was $22.8 million.
Net loss per ADS was $0.89
in the full year of 2018, compared with net loss per ADS of
$0.14 in 2017. Each ADS represents
two ordinary shares.
Business outlook
For the first quarter of 2019, based on current information
available to the Company and business seasonality, the Company
expects net revenues to be between $48 million and
$51 million.
Change in Fair Value of Convertible Promissory Notes Associated with the
Acquisition of ezbuy
The Company entered Share Purchase Agreement ("SPA") on
November 8, 2018 to acquire ezbuy in
the form of non-interest bearing one-year convertible promissory
notes. This SPA took effect on December 10,
2018 where LITB's closing stock price was $0.64. LITB's closing stock price on December 31, 2018 was $1.22. According to the SPA which was filed as an
exhibit to a Form 6-K initially filed on November 8, 2018 and subsequently amended on
November 14, 2018, the change in fair
value of the ADSs was $22.8 million.
As a result, the Company recorded a non-cash loss arising from
change in fair value of the convertible promissory notes of
$22.8 million during the fourth
quarter of 2018.
Conference Call
The Company will hold a conference call at 8:00 a.m. Eastern Time on Friday, March 29, 2019
to discuss its financial results and operating performance for the
fourth quarter 2019. To participate in the call, please dial the
following numbers:
US Toll Free: 1-866-519-4004
Hong Kong Toll Free: 800-906-601
China: 400-620-8038
International: +65-6713-5090
Passcode: 3066439
A telephone replay will be available two hours after the
conclusion of the conference call through April 5, 2019. The dial-in details are:
US: +1-646-254-3697
Hong Kong: +852-3051-2780
International: +61-2-8199-0299
Passcode: 3066439
A live and archived webcast of the conference call will be
available on the Investor Relations section of LightInTheBox's
website at http://ir.lightinthebox.com.
About LightInTheBox Holding Co., Ltd.
LightInTheBox is a cross-border e-commerce platform that
delivers products directly to consumers around the world. The
Company offers customers a convenient way to shop for a wide
selection of products at attractive prices through its
www.lightinthebox.com, www.miniinthebox.com, www.ezbuy.com and
other websites and mobile applications, which are available in 23
major languages and cover more than 100 countries.
For more information, please visit www.lightinthebox.com.
Investor Relations Contact
Christensen
Ms. Xiaoyan Su
Tel: +86 (10) 5900 3429
Email: ir@lightinthebox.com
OR
Christensen
Ms. Linda Bergkamp
Phone: +1-480-614-3004
Email: lbergkamp@ChristensenIR.com
Forward-Looking Statements
This announcement contains forward-looking statements. These
statements are made under the "safe harbor" provisions of the U.S.
Private Securities Litigation Reform Act of 1995. These
forward-looking statements can be identified by terminology such as
"will," "expects," "anticipates," "future," "intends," "plans,"
"believes," "estimates," "potential," "continue," "ongoing,"
"targets" and similar statements. Among other things, statements
that are not historical facts, including statements about
LightInTheBox's beliefs and expectations, the business outlook and
quotations from management in this announcement, as well as
LightInTheBox's strategic and operational plans, are or contain
forward-looking statements. LightInTheBox may also make written or
oral forward-looking statements in its periodic reports to the U.S.
Securities and Exchange Commission (the "SEC"), in press releases
and other written materials and in oral statements made by its
officers, directors or employees to third parties.
Forward-looking statements involve inherent risks and
uncertainties. A number of factors could cause actual results to
differ materially from those contained in any forward-looking
statement, including but not limited to the following:
LightInTheBox's goals and strategies; LightInTheBox's future
business development, results of operations and financial
condition; the expected growth of the global online retail market;
LightInTheBox's ability to attract customers and further enhance
customer experience and product offerings; LightInTheBox's ability
to strengthen its supply chain efficiency and optimize its
logistics network; LightInTheBox's expectations regarding demand
for and market acceptance of its products; competition;
fluctuations in general economic and business conditions and
assumptions underlying or related to any of the foregoing. Further
information regarding these and other risks is included in
LightInTheBox's filings with the SEC. All information provided in
this press release and in the attachments is as of the date of this
press release, and LightInTheBox does not undertake any obligation
to update any forward-looking statement, except as required under
applicable law.
|
LightInTheBox
Holding Co., Ltd.
|
|
Unaudited
Condensed Consolidated Balance Sheets
|
|
(U.S. dollar in
thousands)
|
|
|
|
|
|
|
|
As of December 31,
|
|
As of December 31,
|
|
|
2017
|
|
2018
|
|
ASSETS
|
|
|
|
|
|
Current
Assets
|
|
|
|
|
|
Cash and cash
equivalents
|
|
68,441
|
|
38,808
|
|
Restricted
cash
|
|
1,573
|
|
994
|
|
Accounts receivable,
net of allowance for doubtful
accounts
|
|
3,433
|
|
1,551
|
|
Inventories,
net
|
|
11,841
|
|
8,481
|
|
Prepaid expenses and
other current assets
|
|
15,696
|
|
6,530
|
|
Total current
assets
|
|
100,984
|
|
56,364
|
|
Property and
equipment, net
|
|
920
|
|
3,652
|
|
Acquired intangible
assets, net
|
|
210
|
|
9,890
|
|
Goodwill
|
|
690
|
|
31,140
|
|
Long-term rental
deposit
|
|
671
|
|
1,131
|
|
Long-term
investment
|
|
5,262
|
|
5,188
|
|
TOTAL
ASSETS
|
|
108,737
|
|
107,365
|
|
|
|
|
|
|
LIABILITIES
|
|
|
|
|
|
Current
Liabilities
|
|
|
|
|
|
Accounts
payable
|
|
22,430
|
|
10,832
|
|
Amounts due to
related parties
|
|
-
|
|
4,953
|
|
Convertible
promissory note
|
|
-
|
|
51,922
|
|
Advance from
customers
|
|
10,110
|
|
17,732
|
|
Accrued expenses and
other current liabilities
|
|
20,727
|
|
28,630
|
|
Total
current liabilities
|
|
53,267
|
|
114,069
|
|
|
|
|
|
|
Long-term
payable
|
|
-
|
|
1,156
|
|
Total non-current
liabilities
|
|
-
|
|
1,156
|
|
TOTAL
LIABILITIES
|
|
53,267
|
|
115,225
|
|
|
|
|
|
|
(DEFICIT)
EQUITY
|
|
|
|
|
|
Ordinary
shares
|
|
11
|
|
11
|
|
Treasury shares, at
cost
|
|
(23,907)
|
|
(27,261)
|
|
Additional paid-in
capital
|
|
238,851
|
|
239,269
|
|
Accumulated
deficit
|
|
(159,286)
|
|
(218,888)
|
|
Accumulated other
comprehensive loss
|
|
(199)
|
|
(991)
|
|
TOTAL (DEFICIT)
EQUITY
|
|
55,470
|
|
(7,860)
|
|
TOTAL LIABILITIES AND
EQUITY
|
|
108,737
|
|
107,365
|
|
|
|
|
|
|
LightInTheBox
Holding Co., Ltd.
|
|
Unaudited
Condensed Consolidated Statements of Operations
|
|
(U.S. dollar in
thousands, except share data and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
Three-month Period Ended
|
|
Twelve-month
Period Ended
|
|
|
December
31,
|
|
December
31,
|
|
December
31,
|
|
December
31,
|
|
2017
|
|
2018
|
2017
|
|
2018
|
|
Net
revenues
|
|
|
|
|
|
|
|
|
|
Product
sales
|
|
83,140
|
|
55,465
|
|
293,951
|
|
216,407
|
|
Services and
others
|
|
8,471
|
|
2,074
|
|
25,930
|
|
11,132
|
|
Total net
revenues
|
|
91,611
|
|
57,539
|
|
319,881
|
|
227,539
|
|
Cost of
revenues
|
|
|
|
|
|
|
|
|
|
Product
sales
|
|
(56,665)
|
|
(35,940)
|
|
(189,816)
|
|
(156,326)
|
|
Services and
others
|
|
(7,775)
|
|
(1,687)
|
|
(24,445)
|
|
(10,017)
|
|
Total Cost of
revenues
|
|
(64,440)
|
|
(37,627)
|
|
(214,261)
|
|
(166,343)
|
|
Gross
profit
|
|
27,171
|
|
19,912
|
|
105,620
|
|
61,196
|
|
Operating
expenses
|
|
|
|
|
|
|
|
|
|
Fulfillment
|
|
(5,028)
|
|
(3,547)
|
|
(17,291)
|
|
(15,127)
|
|
Selling and
marketing
|
|
(17,756)
|
|
(11,796)
|
|
(68,891)
|
|
(50,508)
|
|
General and
administrative
|
|
(7,978)
|
|
(6,245)
|
|
(29,605)
|
|
(33,042)
|
|
Total operating
expenses
|
|
(30,762)
|
|
(21,588)
|
|
(115,787)
|
|
(98,677)
|
|
Loss from
operations
|
|
(3,591)
|
|
(1,676)
|
|
(10,167)
|
|
(37,481)
|
|
Exchange gain (loss)
on offshore bank accounts
|
|
(46)
|
|
23
|
|
(89)
|
|
-
|
|
Interest
income
|
|
70
|
|
55
|
|
581
|
|
487
|
|
Interest
expense
|
|
-
|
|
(5)
|
|
-
|
|
(5)
|
|
Change in fair value
of convertible promissory note
|
|
-
|
|
(22,791)
|
|
-
|
|
(22,791)
|
|
Loss before income
taxes
|
|
(3,567)
|
|
(24,394)
|
|
(9,675)
|
|
(59,790)
|
|
Income taxes
expenses
|
|
(51)
|
|
(27)
|
|
(81)
|
|
(33)
|
|
Gain from equity
method investment
|
|
79
|
|
24
|
|
208
|
|
221
|
|
Net
loss
|
|
(3,539)
|
|
(24,397)
|
|
(9,548)
|
|
(59,602)
|
|
|
|
|
|
|
|
|
|
|
Weighted average
numbers of shares used in calculating
loss per ordinary share
|
|
|
|
|
|
|
|
|
|
—Basic
|
|
137,131,854
|
|
133,385,624
|
|
137,641,562
|
|
133,467,980
|
|
—Diluted
|
|
137,131,854
|
|
133,385,624
|
|
137,641,562
|
|
133,467,980
|
|
|
|
|
|
|
|
|
|
|
Net loss per ordinary
share
|
|
|
|
|
|
|
|
|
|
—Basic
|
|
(0.03)
|
|
(0.18)
|
|
(0.07)
|
|
(0.45)
|
|
—Diluted
|
|
(0.03)
|
|
(0.18)
|
|
(0.07)
|
|
(0.45)
|
|
|
|
|
|
|
|
|
|
|
Net loss per ADS (2
ordinary shares equal to 1 ADS)
|
|
|
|
|
|
|
|
|
|
—Basic
|
|
(0.05)
|
|
(0.36)
|
|
(0.14)
|
|
(0.90)
|
|
—Diluted
|
|
(0.05)
|
|
(0.36)
|
|
(0.14)
|
|
(0.90)
|
|
|
|
|
|
|
|
|
|
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SOURCE LightInTheBox Holding Co., Ltd.