Quhuo Reports Unaudited Financial Results for the Second Half and Full Year 2023
- Strong revenue growth driven by vehicle export solutions and mobility service services.
- Positive net income growth with a 15.0% increase year-over-year.
- Successful shipment of vehicles by Quhuo International in 2023.
- Strategic expansion into new avenues like vehicle export solutions and SaaS+ services.
- Focus on seizing growth opportunities in global markets for sustained success.
- Decrease in revenues from on-demand food delivery solutions due to reduced COVID-19 impact.
- Decline in revenues from housekeeping and accommodation solutions and other services.
- Decrease in adjusted EBITDA and adjusted net income compared to the previous year.
Insights
The reported financial results by Quhuo Limited indicate a strategic shift in their business model, with a notable pivot towards vehicle export solutions and SaaS+ services. This diversification away from their traditional on-demand food delivery solutions, which saw a decline in revenue, suggests an attempt to mitigate market risks and capitalize on the emerging new energy vehicle sector. The impressive growth in the mobility service solutions revenue, primarily due to vehicle export solutions, signifies a potential new revenue stream that could attract investor interest, particularly as the global market for electric vehicles continues to expand.
However, the decrease in adjusted EBITDA year-over-year could raise concerns about the company's operational efficiency and scalability of its new ventures. The management's focus on leveraging China's manufacturing capabilities in new energy vehicles to penetrate global markets is an ambitious move that could pay dividends in the long-term, provided they maintain a competitive edge in technology and cost-effectiveness. The reduction in general and administrative expenses reflects improved management efficiency, which is a positive sign for operational streamlining.
Quhuo's financial performance, particularly the transition to a positive net income in 2023 from a net loss in 2022, is indicative of a successful turnaround strategy. The significant role of vehicle export solutions in driving revenue growth is a testament to the company's ability to adapt and find new growth avenues. From a financial perspective, the reduction in general and administrative expenses and the consistent positive EBITDA over the last two years demonstrate a strengthening of the company's financial position.
Investors may find the company's cost management strategies and the expansion into SaaS+ services to be promising indicators of future profitability. However, the decline in revenue from the on-demand food delivery service, once a core segment, could be seen as a red flag that needs to be monitored, as it may reflect changing market dynamics or increased competition. The company's balance sheet, with more cash and short-term investments than short-term debt, suggests a solid liquidity position, which is important for sustaining investment in growth initiatives.
Quhuo's report includes a mention of non-GAAP financial measures, which are commonly used by companies to provide a clearer picture of their operational performance by excluding certain one-time costs. While this practice is legal and provides additional insights, it is important for investors to understand that these measures are supplementary and should be considered alongside GAAP measures. The use of adjusted net income and adjusted EBITDA can help in assessing the company's performance without the noise of non-recurring expenses, but they should not be viewed in isolation as they do not reflect the company's cash expenditures or the requirements for capital expenditures.
It is also worth noting that the company's strategic focus on vehicle export solutions and SaaS+ services may have legal and regulatory implications, especially in international trade and intellectual property rights, which could impact future operations. Investors should be aware of these potential legal challenges as the company expands into global markets.
Financial and Operational Highlights for the Second Half of 2023
- Revenues from vehicle export solutions that were launched in May 2023 were
RMB142.5 million (US ), accounting for$20.1 million 81.3% of revenues from mobility solution services, driving a239.6% year-over-year increase in the latter's revenue. - Net income was
RMB11.7 million (US ), representing a year-over-year increase of$1.6 million 15.0% fromRMB10.2 million . - General and administrative expense was
RMB102.7 million (US ), representing a year-over-year decrease of$14.5 million 9.9% fromRMB114.1 million . - Quhuo International has shipped over 1,700 units of vehicles under its vehicle export solutions.
Financial and Operational Highlights for Full Year 2023
- Revenues from vehicle export solutions that were launched in May 2023 were
RMB154.5 million (US ), accounting for$21.8 million 66.1% of revenues from mobility solution services, driving a year-over-year increase of116.4% in the latter's revenue. - Net income was
RMB6.0 million (US ) in 2023, compared with net loss of$0.8 million RMB16.4 million in 2022. - Adjusted net income was
RMB5.5 million (US ), representing a year-over-year increase of$0.8 million 64.7% fromRMB3.3 million . - General and administrative expense was
RMB184.3 million (US ), representing a year-over-year decrease of$26.0 million 13.7% fromRMB213.6 million . - Quhuo International has signed service contracts for over 3,000 units of vehicles under its vehicle export solutions, of which over 1,900 units have been shipped.
Mr. Leslie Yu, Quhuo's Chairman and Chief Executive Officer, said, "We are pleased to close out fiscal year 2023 with strong financial and operational results. As of the end of 2023, we have achieved positive EBITDA for four consecutive half years, which is a remarkable accomplishment. It signifies the company's consistent profitability over the past two years, demonstrating a stable and sound operational performance."
"In 2023, we strategically pursued a second growth curve for our business by expanding into new avenues through vehicle export solutions and SaaS+ services , following our strategy to enhance profitability following revenue growth initiated in the fiscal year 2021. Our successful export of approximately 1,900 units of new energy vehicles and electric mopeds from
"With a firm belief in the immense opportunities presented by global markets, we are dedicated to seizing these prospects for growth and advancement. Coupled with over a decade of experience in internet operation and technology as well as outstanding last-mile delivery capability achieved through flexible labor practices by Quhuo, the Company will leverage
Unaudited Financial Results of the Second Half of 2023
Total revenues were
- Revenues from on-demand food delivery solutions were
RMB1,763.2 million (US ), representing a decrease of$248.3 million 6.0% fromRMB1,874.9 million in the second half of 2022, primarily because we enjoyed more preferential policies during the second half of 2022 amid the COVID-19 pandemic, which was significantly reduced in the six months ended December 31, 2023 following the relief of the pandemic. - Revenues from mobility service solutions, consisting of shared-bike maintenance, ride-hailing, vehicle export solutions and freight service solutions, were
RMB175.3 million (US ), representing an increase of$24.7 million 239.6% fromRMB51.6 million in the second half of 2022, primarily due to the success of vehicle export solutions, which generated revenue ofRMB 142.5 million (US ).$20.1 million - Revenues from housekeeping and accommodation solutions and other services were
RMB27.5 million (US ), representing a decrease of$3.9 million 8.3% fromRMB30.0 million in the second half of 2022, primarily due to the transition of business model in hotel service.
The cost of revenues was
General and administrative expenses were
Research and development expenses were
We recorded other income, net, of
Income tax expense was
Net income attributable to Quhuo Limited was
Adjusted EBITDA was
Adjusted net income was
Unaudited Financial Results of Full Year 2023
Total revenues were
- Revenues from on-demand food delivery solutions were
RMB3,412.8 million (US ), representing a decrease of$480.7 million 6.2% fromRMB3,638.7 million in 2022, primarily because we enjoyed more preferential policies during 2022 amid the COVID-19 pandemic, which was significantly reduced in 2023 following the relief of the pandemic. - Revenues from mobility service solutions were
RMB233.8 million (US ), representing an increase of$32.9 million 116.4% fromRMB108.1 million in 2022, primarily due to the success of vehicle export solutions, and we exported around 1,900 units of new energy vehicles and electric mopeds fromChina and generated revenue ofRMB 154.5 million (US ) in 2023.$21.8 million - Revenues from housekeeping and accommodation solutions and other services were
RMB55.7 million (US ), representing a decrease of$7.9 million 24.2% fromRMB73.6 million in 2022, primarily due to the transition of business model in hotel service.
Cost of revenues was
General and administrative expenses were
Research and development expenses remained relatively stable at
Other income, net was
Income tax benefit was
Net income attributable to Quhuo Limited was
Adjusted EBITDA was
Adjusted net income was
(1) See "Use of Non-GAAP Financial Measures." |
Balance Sheet
As of December 31, 2023, the Company had cash, short-term investments and restricted cash of
CONFERENCE CALL
Quhuo will hold a conference call on Wednesday, April 3, 2024 at 8:00 a.m.
Dial-in details for the earnings conference call are as follows:
PARTICIPANT DIAL IN (TOLL FREE): | 1-888-346-8982 |
PARTICIPANT INTERNATIONAL DIAL IN: | 1-412-902-4272 |
Hong Kong Toll Free: | 800-905945 |
Hong Kong-Local Toll: | 852-301-84992 |
Mainland China Toll Free: | 4001-201203 |
Conference ID: | QUHUO |
Please dial in ten minutes before the call is scheduled to begin and provide the conference ID to join the call.
A replay of the conference call may be accessed by phone at the following numbers until April 10, 2024:
US Toll Free: | 1-877-344-7529 |
International Toll: | 1-412-317-0088 |
Canada Toll Free: | 855-669-9658 |
Replay Access Code: | 8059541 |
Additionally, a live and archived webcast of the conference call will also be available at the Company's investor relations website at https://ir.quhuo.cn/.
USE OF NON-GAAP FINANCIAL MEASURES
Quhuo has provided in this press release financial information that has not been prepared in accordance with generally accepted accounting principles in
Quhuo uses adjusted net income/loss and adjusted EBITDA, which are non-GAAP financial measures, in evaluating its operating results and for financial and operational decision-making purposes. Adjusted net income/loss represents net income/loss before share-based compensation expenses. Adjusted EBITDA represents adjusted net income/loss before income tax benefit/expense, amortization, depreciation and interest. Quhuo believes that these non-GAAP financial measures help identify underlying trends in its business that could otherwise be distorted by the effect of share-based compensation expenses, income tax benefits or expenses, amortization, depreciation and interest. Quhuo believes that such non-GAAP financial measures also provide useful information about its operating results, enhance the overall understanding of its past performance and prospects and allow for greater visibility with respect to key metrics used by its management in its financial and operational decision-making.
The non-GAAP financial measures are not defined under
For the Six Months Ended | For the Year Ended | |||||||||||
December 31, | December | December | December | December | December | |||||||
(RMB) | (RMB) | (US$) | (RMB) | (RMB) | (US$) | |||||||
Net income/(loss) | 10,172 | 11,698 | 1,647 | (16,414) | 6,008 | 846 | ||||||
Add: Share-based Compensation | 7,259 | (4,348) | (612) | 19,762 | (495) | (70) | ||||||
Adjusted net income | 17,431 | 7,350 | 1,035 | 3,348 | 5,513 | 776 | ||||||
Add: Income tax expense/(benefit) | 14,319 | 1,468 | 207 | 21,002 | (927) | (131) | ||||||
Depreciation | 3,715 | 2,389 | 336 | 7,513 | 5,316 | 749 | ||||||
Amortization | 10,431 | 10,302 | 1,451 | 21,094 | 20,430 | 2,878 | ||||||
Interest | 1,897 | 2,559 | 360 | 5,683 | 4,882 | 688 | ||||||
Adjusted EBITDA | 47,793 | 24,068 | 3,389 | 58,640 | 35,214 | 4,960 | ||||||
EXCHANGE RATE INFORMATION
This press release contains translations of certain Renminbi amounts into
ABOUT QUHUO LIMITED
Quhuo Limited (NASDAQ: QH) ("Quhuo" or the "Company") is a leading gig economy platform focusing on local life services in China. Leveraging Quhuo+, its proprietary technology infrastructure, Quhuo is dedicated to empowering and linking workers and local life service providers and providing end-to-end operation solutions for the life service market. The Company currently provides multiple industry-tailored operational solutions, primarily including on-demand delivery solutions, mobility service solutions, housekeeping and accommodation solutions, and other services, meeting the living needs of hundreds of millions of families in the communities.
With the vision of promoting employment, stabilizing income and empowering entrepreneurship, Quhuo explores multiple scenarios to promote employment of workers, provides, among others, safety and security and vocational training to protect workers, and helps workers plan their career development paths to realize their self-worth.
SAFE HARBOR STATEMENT
This press release contains ''forward-looking statements'' within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended and the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical or current fact included in this press release are forward-looking statements, including but not limited to statements regarding Quhuo's business development, financial outlook, beliefs and expectations. Forward-looking statements include statements containing words such as "expect," "anticipate," "believe," "project," "will" and similar expressions intended to identify forward-looking statements. These forward-looking statements are based on Quhuo's current expectations and involve risks and uncertainties. Quhuo's actual results and the timing of events could differ materially from those anticipated in such forward-looking statements as a result of these risks and uncertainties, which include, without limitation, risks and uncertainties related to Quhuo's abilities to (1) manage its growth and expand its operations, (2) address any or all of the risks and challenges in the future in light of its limited operating history and evolving business portfolios, (3) remain its competitive position in the on-demand food delivery market or further diversify its solution offerings and customer portfolio, (4) maintain relationships with major customers and to find replacement customers on commercially desirable terms or in a timely manner or at all, (5) maintain relationship with existing industry customers or attract new customers, (6) attract, retain and manage workers on its platform, and (7) maintain its market shares to competitors in existing markets and its success in expansion into new markets. Other risks and uncertainties are included under the caption "Risk Factors" and elsewhere in the Company's filings with the Securities and Exchange Commission, including, without limitation, the Company's latest annual report on Form 20-F. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. All forward-looking statements are qualified in their entirety by this cautionary statement, and Quhuo undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date hereof.
For more information about Quhuo, please visit https://ir.quhuo.cn/.
QUHUO LIMITED | ||||||
UNAUDITED INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||
(Amounts in thousands of Renminbi ("RMB") and | ||||||
As of December 31, 2022 | As of December 31, 2023 | As of December 31, 2023 | ||||
(RMB) | (RMB) | (US$) | ||||
Assets | ||||||
Current assets | ||||||
Cash | 95,444 | 45,185 | 6,364 | |||
Restricted cash | 5,579 | 1,271 | 179 | |||
Short-term investments | 64,355 | 68,378 | 9,631 | |||
Accounts receivable, net | 495,046 | 475,992 | 67,042 | |||
Prepayments and other current assets | 54,921 | 108,354 | 15,261 | |||
Amounts due from related parties | 3,876 | 253 | 36 | |||
Total current assets | 719,221 | 699,433 | 98,513 | |||
Property and equipment, net | 11,450 | 14,635 | 2,061 | |||
Right-of-use assets, net | 5,562 | 6,217 | 876 | |||
Intangible assets, net | 101,603 | 82,818 | 11,665 | |||
Goodwill | 65,481 | 65,481 | 9,223 | |||
Deferred tax assets | 12,000 | 21,968 | 3,094 | |||
Other non-current assets | 140,300 | 141,384 | 19,914 | |||
Total non-current assets | 336,396 | 332,503 | 46,833 | |||
Total assets | 1,055,617 | 1,031,936 | 145,346 | |||
liabilities, non-controlling interests and shareholders' equity | ||||||
Current liabilities | ||||||
Accounts payables | 293,281 | 254,099 | 35,789 | |||
Accrued expenses and other current liabilities | 125,949 | 108,132 | 15,230 | |||
Short-term debt | 65,434 | 92,653 | 13,050 | |||
Short-term lease liabilities | 3,276 | 3,906 | 550 | |||
Total current liabilities | 487,940 | 458,790 | 64,619 | |||
Long-term debt | 1,303 | 7,533 | 1,061 | |||
Long-term lease liabilities | 1,103 | 1,434 | 202 | |||
Deferred tax liabilities | 814 | 4,689 | 660 | |||
Other non-current liabilities | 66,880 | 54,212 | 7,636 | |||
Total non-current liabilities | 70,100 | 67,868 | 9,559 | |||
Total liabilities | 558,040 | 526,658 | 74,178 | |||
QUHUO LIMITED | ||||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||
As of December | As of December | As of December | ||||
(RMB) | (RMB) | (US$) | ||||
Shareholders' equity | ||||||
Ordinary shares | 43 | 43 | 6 | |||
Additional paid-in capital | 1,885,637 | 1,885,142 | 265,517 | |||
Accumulated deficit | (1,379,864) | (1,376,530) | (193,880) | |||
Accumulated other comprehensive income | (4,654) | (2,466) | (347) | |||
Total Quhuo Limited shareholders' equity | 501,162 | 506,189 | 71,296 | |||
Non-controlling interests | (3,585) | (911) | (128) | |||
Total shareholders' equity | 497,577 | 505,278 | 71,168 | |||
Total liabilities and shareholders' equity | 1,055,617 | 1,031,936 | 145,346 | |||
QUHUO LIMITED | ||||||||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS)/INCOME | ||||||||||||
(Amounts in thousands of Renminbi ("RMB") and | ||||||||||||
For the Six Months Ended | For the Year Ended | |||||||||||
December | December | December | December | December | December | |||||||
(RMB) | (RMB) | (US$) | (RMB) | (RMB) | (US$) | |||||||
Revenues | 1,956,583 | 1,966,070 | 276,915 | 3,820,378 | 3,702,387 | 521,470 | ||||||
Cost of revenues | (1,797,823) | (1,866,263) | (262,858) | (3,567,690) | (3,535,778) | (498,004) | ||||||
General and administrative | (114,067) | (102,725) | (14,469) | (213,592) | (184,336) | (25,963) | ||||||
Research and development | (5,379) | (5,733) | (807) | (12,540) | (12,378) | (1,743) | ||||||
Gain on disposal of assets, net | 9,243 | 13,401 | 1,887 | 13,975 | 22,317 | 3,143 | ||||||
Goodwill impairment | (4,882) | - | - | (4,882) | - | - | ||||||
Operating income/(loss) | 43,675 | 4,750 | 668 | 35,649 | (7,788) | (1,097) | ||||||
Interest income | 499 | 305 | 43 | 690 | 1,047 | 147 | ||||||
Interest expense | (1,897) | (2,559) | (360) | (5,683) | (4,882) | (688) | ||||||
Other (loss)/income, net | (17,786) | 10,670 | 1,503 | (26,068) | 16,704 | 2,353 | ||||||
Loss before income tax | 24,491 | 13,166 | 1,854 | 4,588 | 5,081 | 715 | ||||||
Income tax (expense)/benefit | (14,319) | (1,468) | (207) | (21,002) | 927 | 131 | ||||||
Net income/(loss) | 10,172 | 11,698 | 1,647 | (16,414) | 6,008 | 846 | ||||||
Net loss/(income) attributable | 1,651 | 1,284 | 181 | 3,284 | (2,674) | (377) | ||||||
Net income/(loss) attributable | 11,823 | 12,982 | 1,828 | (13,130) | 3,334 | 469 | ||||||
Non-GAAP Financial Data | ||||||||||||
Adjusted net income | 17,431 | 7,350 | 1,035 | 3,348 | 5,513 | 776 | ||||||
Adjusted EBITDA | 47,793 | 24,068 | 3,389 | 58,640 | 35,214 | 4,960 | ||||||
Earnings/(loss) per share for class A and class B ordinary shares | ||||||||||||
Basic | 0.21 | 0.23 | 0.03 | (0.23) | 0.06 | 0.01 | ||||||
Diluted | 0.20 | 0.23 | 0.03 | (0.23) | 0.06 | 0.01 | ||||||
Shares used in earnings/(loss) per share computation: | ||||||||||||
Basic | 56,168,787 | 55,855,737 | 55,855,737 | 56,007,723 | 55,534,919 | 55,534,919 | ||||||
Diluted | 59,123,432 | 55,855,737 | 55,855,737 | 56,007,723 | 55,534,919 | 55,534,919 | ||||||
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SOURCE Quhuo
FAQ
What was the year-over-year increase in revenue from mobility solution services in the second half of 2023?
How many units of vehicles were shipped by Quhuo International in the full year 2023?
What is the focus of Quhuo's strategic expansion in 2023?
What does Quhuo aim to achieve through its global market approach?
What caused the decrease in revenues from on-demand food delivery solutions in the second half of 2023?
