Leju Reports First Half Year 2022 Results

Rhea-AI Summary

Leju Holdings Limited (NYSE: LEJU) reported a 44% year-on-year drop in total revenues for the first half of 2022, totaling $169.4 million. E-commerce services revenue decreased by 43%, while online advertising fell 47%. The company suffered a loss from operations of $64.8 million, worsening from a loss of $49.9 million in the prior year. Net loss attributable to shareholders reached $52.9 million, or $3.86 loss per ADS. Ongoing challenges in China's real estate sector and the impact of COVID-19 contributed to these declines.

Positive

• Cost of revenues decreased by 54% to $14.5 million, indicating improved cost control.
• Selling, general and administrative expenses fell by 31% to $219.8 million, driven by a reduction in bad debt provision.

Negative

• Total revenues dropped by 44% year-on-year, reflecting severe operational challenges in the real estate market.
• Loss from operations worsened to $64.8 million, up from $49.9 million in the previous year.
• Net loss attributable to shareholders increased to $52.9 million, compared to $47.8 million in the same period of 2021.
• E-commerce revenue decreased by 43% to $132.7 million, due to fewer discount coupons redeemed.
• Online advertising revenue fell by 47% to $36.8 million, indicating reduced demand from property developers.

BEIJING, Nov. 30, 2022 /PRNewswire/ -- Leju Holdings Limited ("Leju" or the "Company") (NYSE: LEJU), a leading online-to-offline ("O2O") real estate services provider in China, today announced its unaudited financial results for the six months ended June 30, 2022.

First Half 2022 Financial Highlights

• Total revenues decreased by 44% year on year to $169.4 million.
  - Revenues from e-commerce services decreased by 43% year on year to $132.7 million.
  - Revenues from online advertising services decreased by 47% year on year to $36.8 million.
• Loss from operations was $64.8 million, compared to loss from operations of $49.9 million for the same period of 2021.
• Non-GAAP^[1] loss from operations was $58.6 million, compared to Non-GAAP loss from operations of $43.4 million for the same period of 2021.
• Net loss attributable to Leju Holdings Limited shareholders was $52.9 million, or $3.86 loss per diluted American depositary share ("ADS"), compared to net loss attributable to Leju Holdings Limited shareholders of $47.8 million, or $3.50 loss per diluted ADS^[2], for the same period of 2021.
• Non-GAAP net loss attributable to Leju Holdings Limited shareholders was $48.0 million, or $3.50 loss per diluted ADS, compared to non-GAAP net loss attributable to Leju Holdings Limited shareholders of $42.6 million, or $3.12 loss per diluted ADS, for the same period of 2021.

[1] Leju uses in this press release the following non-GAAP financial measures: (1) income (loss) from operations, (2) net income (loss), (3) net income (loss) attributable to Leju shareholders, (4) net income (loss) attributable to Leju shareholders per basic ADS, and (5) net income (loss) attributable to Leju shareholders per diluted ADS, each of which excludes share-based compensation expense, amortization of intangible assets resulting from business acquisitions, and income tax impact on the share-based compensation expense and amortization of intangible assets resulting from business combinations. See "About Non-GAAP Financial Measures" and "Unaudited Reconciliation of GAAP and Non-GAAP Results" below for more information about the non-GAAP financial measures included in this press release.

[2] On May 10, 2022, Leju announced that it would change its American depositary share ("ADS") to ordinary share ("Share") ratio from one (1) ADS representing one (1) Share to one (1) ADS representing ten (10) Shares. The change in the ADS ratio was effective on May 20, 2022. For Leju's ADS holders, the change in the ADS ratio had the same effect as a one-for-ten reverse ADS split. The ADS ratio change has no impact on Leju's underlying Shares. Loss per ADS for first half of 2021 had been retrospectively adjusted accordingly.

"In the first half of 2022, China's real estate developers experienced significant operational challenges which combined with the impact of the COVID-19 pandemic resurgence caused a decline in both real estate development and sales, largely impacting Leju's online advertising and e-commerce businesses," said Mr. Geoffrey He, Leju's Chief Executive Officer.

First Half 2022 Results

Total revenues were $169.4 million, a decrease of 44% from $301.1 million for the same period of 2021. China's real estate industry experienced a steep downturn since the second half of 2021 and many real estate developers faced severe operational challenges. This had a direct and negative impact on the Company's online advertising and e-commerce businesses. Due to the continuous decline of the real estate industry, the recoverable amount and time of some customers' transaction consideration cannot be reasonably expected. Since January 1, 2022, Leju has not recognized the revenue from such customers until the actual receipt of the transaction consideration.

Revenues from e-commerce services were $132.7 million, a decrease of 43% from $231.4 million for the same period of 2021, primarily due to a decrease in the number of discount coupons redeemed, partially offset by an increase in the average price per discount coupon redeemed.

Revenues from online advertising services were $36.8 million, a decrease of 47% from $69.3 million for the same period of 2021, primarily due to a decrease in property developers' demand for online advertising.

Cost of revenues was $14.5 million, a decrease of 54% from $31.7 million for the same period of 2021, primarily due to decreased cost of advertising resources purchased from media platforms, and decreased editorial personnel related costs.

Selling, general and administrative expenses were $219.8 million, a decrease of 31% from $319.5 million for the same period of 2021, primarily due to bad debt provision which decreased $33.9 million compared to the same period of 2021, and decreased marketing expenses related to the Company's e-commerce business. The bad debt provision recorded in the first half of 2021 was mainly attributable to the recognition of additional loss allowance on expected credit loss of the Company's outstanding online advertising related receivables from certain customer, whose credit quality had worsened.

Loss from operations was $64.8 million, compared to loss from operation of $49.9 million for the same period of 2021. Non-GAAP loss from operations was $58.6 million, compared to non-GAAP loss from operations of $43.4 million for the same period of 2021.

Net loss was $52.8 million, compared to net loss of $46.9 million for the same period of 2021. Non-GAAP net loss was $47.9 million, compared to non-GAAP net loss of $41.7 million for the same period of 2021.

Net loss attributable to Leju Holdings Limited shareholders was $52.9 million, or $3.86 loss per diluted ADS, compared to net loss attributable to Leju Holdings Limited shareholders of $47.8 million, or $3.5 loss per diluted ADS, for the same period of 2021. Non-GAAP net loss attributable to Leju Holdings Limited shareholders was $48.0 million, or $3.50 loss per diluted ADS, compared to non-GAAP net loss attributable to Leju Holdings Limited shareholders of $42.6 million, or $3.12 loss per diluted ADS, for the same period of 2021.

Cash Flow

As of June 30, 2022, the Company's cash and cash equivalents and restricted cash balance was $182.6 million.

First half 2022 net cash used in operating activities was $60.6 million, primarily comprised of non-GAAP net loss of $47.9 million, a decrease in other current liabilities and accrued expenses of $37.7 million, a decrease in income tax payable of $10.8 million, partially offset by a decrease in accounts receivable and contract assets of $19.5 million and a decrease in prepaid expenses and other current assets of $18.5 million.

About Leju

Leju Holdings Limited ("Leju") (NYSE: LEJU) is a leading e-commerce and online media platform for real estate and home furnishing industries in China, offering real estate e-commerce, online advertising and online listing services. Leju's integrated online platform comprises various mobile applications along with local websites covering more than 380 cities, enhanced by complementary offline services to facilitate residential property transactions. In addition to the Company's own websites, Leju operates the real estate and home furnishing websites of SINA Corporation, and maintains a strategic partnership with Tencent Holdings Limited. For more information about Leju, please visit http://ir.leju.com.

Safe Harbor: Forward-Looking Statements

This announcement contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in 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," "target," "going forward," "outlook" and similar statements. Leju may also make written or oral forward-looking statements in its reports filed or furnished with the U.S. Securities and Exchange Commission, in its annual report 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 Leju's beliefs and expectations, are forward-looking statements that involve inherent risks and uncertainties. A number of important factors could cause actual results to differ materially from those contained, either expressly or impliedly, in any of the forward-looking statements. Such factors include, but are not limited to, fluctuations in China's real estate market; the highly regulated nature of, and government measures affecting, the real estate and internet industries in China; Leju's ability to compete successfully against current and future competitors; its ability to continue to develop and expand its content, service offerings and features, and to develop or incorporate the technologies that support them; its reliance on SINA and others with which it has developed, or may develop in the future, strategic partnerships; substantial revenue contribution from a limited number of real estate markets; and relevant government policies and regulations relating to the corporate structure, business and industry of Leju. Further information regarding these and other risks, uncertainties or factors is included in the Company's filings with the U.S. Securities and Exchange Commission. All information provided in this press release is current as of the date of the press release, and the Company does not undertake any obligation to update any forward-looking statement as a result of new information, future events or otherwise, except as required under applicable law.

About Non-GAAP Financial Measures

To supplement Leju's consolidated financial results presented in accordance with United States Generally Accepted Accounting Principles ("GAAP"), Leju uses in this press release the following non-GAAP financial measures: (1) income (loss) from operations, (2) net income (loss), (3) net income (loss) attributable to Leju shareholders, (4) net income (loss) attributable to Leju shareholders per basic ADS, and (5) net income (loss) attributable to Leju shareholders per diluted ADS, each of which excludes share-based compensation expense, amortization of intangible assets resulting from business acquisitions, and income tax impact on the share-based compensation expense and amortization of intangible assets resulting from business combinations. 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 GAAP. For more information on these non-GAAP financial measures, please see the table captioned "Unaudited Reconciliation of GAAP and Non-GAAP Results" set forth at the end of this press release.

Leju believes that these non-GAAP financial measures provide meaningful supplemental information to investors regarding its operating performance by excluding share-based compensation expense and amortization of intangible assets resulting from business acquisitions, which may not be indicative of Leju's operating performance. These non-GAAP financial measures also facilitate management's internal comparisons to Leju's historical performance and assist its financial and operational decision making. A limitation of using these non-GAAP financial measures is that share-based compensation expense and amortization of intangible assets resulting from business acquisitions may continue to exist in Leju's business for the foreseeable future. Management compensates for these limitations by providing specific information regarding the GAAP amounts excluded from each non-GAAP measure. The accompanying tables provide more details on the reconciliation between non-GAAP financial measures and their most comparable GAAP financial measures.

For investor and media inquiries please contact:

Ms. Christina Wu
Leju Holdings Limited
Phone: +86 (10) 5895-1062
E-mail: ir@leju.com

Philip Lisio
The Foote Group
Phone: +86 135-0116-6560
E-mail: phil@thefootegroup.com

LEJU HOLDINGS LIMITED
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands of U.S. dollars)
			December 31,						June 30,
			2021						2022
ASSETS
Current assets
Cash and cash equivalents				250,314						178,202
Restricted cash				2,082						4,349
Accounts receivable, net				36,071						5,318
Contract assets, net				1,415						—
Marketable securities				1,186						—
Prepaid expenses and other current assets				25,110						7,283
Customer deposits				784						—
Amounts due from related parties				3,913						10,116
Total current assets				320,875						205,268
Property and equipment, net				16,667						15,324
Intangible assets, net				23,298						17,803
Right-of-use assets				23,409						19,822
Investment in affiliates				18						17
Deferred tax assets, net				51,605						49,024
Other non-current assets				1,376						1,712
Total assets				437,248						308,970
LIABILITIES AND EQUITY
Current liabilities
Short-term borrowings				784						1,490
Accounts payable				1,631						1,181
Accrued payroll and welfare expenses				21,517						15,438
Income tax payable				60,952						49,440
Other tax payable				18,046						13,693
Amounts due to related parties				7,632						3,635
Advances from customers				82,788						55,905
Lease liabilities, current				5,582						4,923
Accrued marketing and advertising expenses				43,272						31,825
Other current liabilities				18,504						16,477
Total current liabilities				260,708						194,007
Lease liabilities, non-current				19,438						16,414
Deferred tax liabilities				6,043						4,707
Total liabilities				286,189						215,128
Shareholders' Equity
Ordinary shares ($0.001 par value): 1,000,000,000 shares    authorized, 136,822,601 and 137,172,601 shares issued and    outstanding, as of December 31, 2021 and June 30, 2022,    respectively				137						137
Additional paid-in capital				801,477						802,406
Accumulated deficit				(648,935)						(701,787)
Accumulated other comprehensive loss				(1,424)						(6,726)
Total Leju Holdings Limited shareholders' equity				151,255						94,030
Non-controlling interests				(196)						(188)
Total equity				151,059						93,842
TOTAL LIABILITIES AND EQUITY				437,248						308,970

 

 

LEJU HOLDINGS LIMITED
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands of U.S. dollars, except share data and per share data)
			Six months ended
			June 30,
			2021				2022
Revenues
E-commerce				231,401				132,654
Online advertising				69,290				36,783
Listing				401				11
Total net revenues				301,092				169,448
Cost of revenues				(31,671)				(14,474)
Selling, general and administrative expenses				(319,472)				(219,762)
Other operating income, net				199				25
Loss from operations				(49,852)				(64,763)
Interest income, net				1,575				1,515
Other income, net				2,128				801
Loss before taxes and loss from equity in affiliates				(46,149)				(62,447)
Income tax benefits (expenses)				(730)				9,642
Loss before loss from equity in affiliates				(46,879)				(52,805)
Loss from equity in affiliates				(8)				—
Net loss				(46,887)				(52,805)
Less: net income attributable to non-controlling interests				885				47
Net loss attributable to Leju Holdings Limited shareholders				(47,772)				(52,852)
Loss per ADS:
Basic				(3.50)				(3.86)
Diluted				(3.50)				(3.86)
ADS used in computation of loss per ADS:
Basic				13,648,534				13,691,216
Diluted				13,648,534				13,691,216
The conversion of Renminbi ("RMB") amounts into reporting currency USD amounts is based on the rate of USD1 = RMB6.7114 on June 30, 2022 and the average rate of USD1 = RMB6.4423 for the six months ended June 30, 2022

 

 

LEJU HOLDINGS LIMITED
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS)
(In thousands of U.S. dollars)
			Six months ended
			June 30,
			2021				2022
Net loss				(46,887)				(52,805)
Other comprehensive income (loss), net of tax of nil
Foreign currency translation adjustment				2,400				(5,341)
Comprehensive loss				(44,487)				(58,146)
Less: Comprehensive income attributable to non-controlling    interest				892				8
Comprehensive loss attributable to Leju Holdings Limited    shareholders				(45,379)				(58,154)

 

 

LEJU HOLDINGS LIMITED
Unaudited Reconciliation of GAAP and Non-GAAP Results
(In thousands of U.S. dollars, except share data and per ADS data)
			Six months ended
			June 30,
			2021				2022
GAAP loss from operations				(49,852)				(64,763)
Share-based compensation expense				1,194				929
Amortization of intangible assets resulting from business    acquisitions				5,279				5,279
Non-GAAP loss from operations				(43,379)				(58,555)
GAAP net loss				(46,887)				(52,805)
Share-based compensation expense				1,194				929
Amortization of intangible assets resulting from business    acquisitions				5,279				5,279
Income tax benefit:
Current				—				—
Deferred[3]				(1,320)				(1,320)
Non-GAAP net loss				(41,734)				(47,917)
Net loss attributable to Leju Holdings Limited shareholders				(47,772)				(52,852)
Share-based compensation expense (net of non-controlling    interests)				1,194				929
Amortization of intangible assets resulting from business    acquisitions (net of non-controlling interests)				5,279				5,279
Income tax benefit:
Current				—				—
Deferred				(1,320)				(1,320)
Non-GAAP net loss attributable to Leju Holdings Limited    shareholders				(42,619)				(47,964)
GAAP net loss per ADS — basic				(3.50)				(3.86)
GAAP net loss per ADS —diluted				(3.50)				(3.86)
Non-GAAP net loss per ADS —basic				(3.12)				(3.50)
Non-GAAP net loss per ADS —diluted				(3.12)				(3.50)
ADS used in calculating basic GAAP/non-GAAP net loss    attributable to Leju Holdings Limited shareholders per ADS				13,648,534				13,691,216
ADS used in calculating diluted GAAP/non-GAAP net loss    attributable to Leju Holdings Limited shareholders per ADS				13,648,534				13,691,216
[3] Amount represents the realization of deferred tax liabilities recognized for the temporary difference between the tax basis of intangible assets recognized from acquisitions and their reported amounts in the financial statements. The income tax impact on the share-based compensation expense is nil.

 

 

LEJU HOLDINGS LIMITED
SELECTED OPERATING DATA
		Six months ended
		June 30,
		2021				2022
Operating data for e-commerce services
Number of discount coupons issued to prospective purchasers    (number of transactions)			92,058				31,456
Number of discount coupons redeemed (number of transactions)			77,378				35,262

 

 

View original content:https://www.prnewswire.com/news-releases/leju-reports-first-half-year-2022-results-301690135.html

SOURCE Leju Holdings Limited

FAQ

What were Leju Holdings' total revenues for the first half of 2022?

Leju Holdings reported total revenues of $169.4 million for the first half of 2022.

How much did Leju's net loss increase in the first half of 2022?

Leju's net loss increased to $52.9 million in the first half of 2022, compared to $47.8 million in the same period of 2021.

What was the loss from operations for Leju in the first half of 2022?

Leju reported a loss from operations of $64.8 million for the first half of 2022.

How did Leju's e-commerce revenue change in the first half of 2022?

E-commerce revenue for Leju decreased by 43% year-on-year to $132.7 million.

What caused the decline in Leju's online advertising revenue?

The decline in Leju's online advertising revenue was primarily due to decreased demand from property developers.