Jowell Global Ltd. Announces Third Quarter 2022 Unaudited Financial Results
Jowell Global Ltd. (NASDAQ: JWEL) announced its third quarter 2022 results, reporting revenues of $51.4 million, marking a 17.2% increase year-over-year. The Gross Merchandise Value (GMV) transacted was $66.8 million, up 7.8% from the previous year. The company saw a net loss of $2.0 million, slightly improved from a loss of $2.1 million in Q3 2021. Total VIP members reached 2.4 million, a 14.4% increase, and LHH stores grew by 1.6% to 26,300. Jowell continues to focus on strategic partnerships and premium product offerings despite ongoing COVID-19 impacts.
- Quarterly revenues increased by 17.2% to $51.4 million.
- GMV rose by 7.8% to $66.8 million.
- Total VIP members increased by 14.4% to 2.4 million.
- LHH stores grew by 1.6% to 26,300.
- Sales of cosmetic products grew by 24.7%.
- Net loss was $2.0 million, indicating ongoing financial challenges.
- Total operating expenses rose by 16.5% to $53.5 million.
- Cost of revenues increased by 20.1% to $48.4 million, impacting profitability.
-- Third quarter Revenue of
-- Third quarter GMV of
SHANGHAI, China, Nov. 07, 2022 (GLOBE NEWSWIRE) -- Jowell Global Ltd. (“Jowell” or the “Company”) (NASDAQ: JWEL), one of the leading cosmetics, health and nutritional supplements, and household products e-commerce platforms in China, today announced its unaudited financial results for the third quarter ended September 30, 2022.
The Company cautioned that these financial results have not been audited or reviewed by the Company’s independent registered public accounting firm and may have discrepancies in connection with further reviews by the independent registered public accounting firm of the Company.
Third Quarter 2022 Financial and Operational Highlights
● Total revenues were
● Net loss was
● Total GMV (Gross Merchandise Value) transacted in the Company’s online shopping mall was
● Total VIP members1 as of September 30, 2022 were 2.4 million, an increase of
● Total LHH stores2 as of September 30, 2022 were 26,300, an increase of
Mr. Zhiwei Xu, Chief Executive Officer and Chairman of Jowell Global Ltd., commented: “Despite the adverse COVID impact in most of the cities in China, we continued to deliver another solid quarter with sustained topline growth. GMV in Q3 were
Mr. Xu continued: “Additionally, we remain committed to collaborate with top global talents and companies to diversify our product offering and introduce premium international brands to Chinese consumers. In September, we announced strategic partnership with Italian based So.Di.Co Group to promote the sales of its organic and natural personal care products in China. In October, we announced another cooperative partnership with a leading European pharmaceutical company STADA,in which Jowell will be the exclusive distributor to sell its Zoflora products on Jowell’s e-commerce platform and accelerate its outreach in the cleaning and consumer products market in China. Looking ahead, we will continue to execute our growth strategies with a focus on optimizing our platform through product offerings catered to consumer needs, as well as acceleration of our partnerships with leading domestic and international brands.”
Ms. Mei Cai, Chief Financial Officer of the Company, added: “In the third quarter, we achieved healthy topline growth through a series of strategic promotional activities. Total revenue grew by
1 “Total VIP members refers to the total number of members registered on Jowell’s platform as of September 30, 2022.
2 LHH stores: the brand name of “Love Home Store”. Authorized retailers may operate as independent stores or store-in-shop (an integrated store), selling products they purchased through Jowell’s online platform LHH Mall under their retailer accounts which provides them with major discounts.
Impact of COVID-19 Pandemic
Due to the outbreak of Omicron variant in China, many cities in China have imposed new restrictions, quarantine and testing requirements and office closures during the first nine months of 2022, including Shanghai, where the Company’s headquarters are located. Employees of the VIE in Shanghai office worked from home from March 30, 2022 to June 1, 2022.
Although COVID-19 has been generally under control in most parts of China, there are still outbreaks and controlling measures imposed by local government in various cities. It is hard to predict the impact of the COVID-19 pandemic on the business operations and financial results for the remainder of 2022, which is highly dependent on numerous factors beyond the Company’s control, such as the duration and the spread of the pandemic, COVID-19 resurgence or new variant outbreak like Omicron, COVID-19 vaccine efficacy and distribution, and COVID-19 containment actions implemented by government authorities or other entities and the implementation of zero COVID policy in China, including restrictions and office closures in Shanghai and other cities in China, almost all of which are beyond the Company’s control.
Third Quarter 2022 Financial Results
Total Revenues
Total revenues for the third quarter of 2022 were
Three Months Ended September 30 | % | |||||||||||
Revenues | 2022 | 2021 | change | |||||||||
(in thousand) | US$ | US$ | YoY* | |||||||||
Product sales | ||||||||||||
● Cosmetic products | 24,436.6 | 19,602.3 | 24.7 | % | ||||||||
● Health and nutritional supplements | 9,373.0 | 14,961.4 | -37.4 | % | ||||||||
● Household products | 17,505.0 | 9,243.7 | 89.4 | % | ||||||||
● Others | 46.7 | 6.5 | 618.5 | % | ||||||||
Total | 51,361.3 | 43,813.9 | 17.2 | % |
* YoY – year over year
Total Operating Expenses
Total operating expenses were
● Cost of revenues were
● Fulfillment expenses primarily consist of costs related to order fulfillment, including expenses paid for order preparing, packaging, outbound freight, and physical storage. Fulfillment expenses were
● Marketing expenses primarily consist of targeted online advertising, payroll and related expenses for personnel engaged in marketing and selling activities. Marketing expenses were
● General and administrative expenses mainly consist of payroll, depreciation, office supplies and upkeep expenses. General and administration expenses were
Operating loss
Operating loss was
Net loss
Net loss was
Earnings (Loss) per share
The Company computes earnings (loss) per share (“EPS”) in accordance with ASC 260, “Earnings per Share” (“ASC 260”). Each Preferred Share of the Company has voting rights equal to two Ordinary Shares of the Company and each Preferred Share is convertible into one Ordinary Share at any time by its holder. Except for voting rights and conversion rights, the Ordinary Shares and the Preferred Shares shall rank pari passu with one another and shall have the same rights, preferences, privileges and restrictions. For the third quarter ended September 30, 2022 and 2021, the Company had no potential ordinary shares outstanding that could potentially dilute EPS in the future.
Cash and cash equivalents
As of September 30, 2022, the Company had cash and restricted cash of
For the third quarter of 2022, the Company reported a net loss of
Presently, the Company’s principal sources of liquidity are from its operations, proceeds from its recent private placements of
Based on the latest business plan of the Company, Shanghai Juhao has reduced its promotion efforts and expenditures since the second half of 2022, which will reduce its cash flow used in operating activities. Therefore, management believes that the above-mentioned measures, as well as existing cash and restricted cash on hand of approximately
About Jowell Global Ltd.
Jowell Global Ltd. (the “Company”) is one of the leading cosmetics, health and nutritional supplements and household products e-commerce platforms in China. The Company offers its own brand products to customers; also sells and distributes health and nutritional supplements, cosmetic products and certain household products from other companies on its platform. In addition, the Company allows third parties to open their own stores on its platform for a service fee based upon sale revenues generated from their online stores. The Company provides them with its unique and valuable information about market needs, enabling them to better manage their sales effort, as well as an effective platform to promote their brands. In addition, the Company sells its products through authorized retail stores all across China, which operates under the brand names of “Love Home Store” or “LHH Store” and “Juhao Best Choice Store”. For more information, please visit http://ir.1juhao.com/ .
Exchange Rate
The Company’s financial information is presented in U.S. dollars (“USD”). The functional currency of the Company is the Chinese Yuan, Renminbi (“RMB”), the currency of the PRC. Any transactions which are denominated in currencies other than RMB are translated into RMB at the exchange rate quoted by the People’s Bank of China prevailing at the dates of the transactions, and exchange gains and losses are included in the statements of operations as foreign currency transaction gain or loss. The consolidated financial statements of the Company have been translated into U.S. dollars in accordance with ASC 830, “Foreign Currency Matters”.
This press release contains translations of certain RMB amounts into U.S. dollars (“USD” or “$”) at specified rates solely for the convenience of the reader. The exchange rates in effect as of September 30, 2022 and December 31, 2021 were RMB1 for
Safe Harbor Statement
This press release contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. Statements that are not historical facts, including statements about the Company’s beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties, and a number of factors could cause actual results to differ materially from those contained in any forward-looking statement. In some cases, forward-looking statements can be identified by words or phrases such as “may,” “will,” “expect,” “anticipate,” “target,” “aim,” “estimate,” “intend,” “plan,” “believe,” “potential,” “continue,” “is/are likely to” or other similar expressions. The Company 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. These statements are subject to uncertainties and risks including, but not limited to, the following: the Company’s goals and strategies; the Company’s future business development; financial condition and results of operations; product and service demand and acceptance; reputation and brand; the impact of competition and pricing; changes in technology; government regulations; fluctuations in general economic and business conditions in China and assumptions underlying or related to any of the foregoing and other risks contained in reports filed by the Company with the SEC. For these reasons, among others, investors are cautioned not to place undue reliance upon any forward-looking statements in this press release. Additional factors are discussed in the Company’s filings with the SEC, which are available for review at www.sec.gov. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof.
For investor and media inquiries, please contact:
In China:
Jowell Global Ltd.
Ms. Jessie Zhao
Email: IR@1juhao.com
Seaquant Consulting
Mr. Roye Zhang
Email: roye@sea-quant.com
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