Scienjoy Reports Unaudited First Quarter 2022 Financial Results
Scienjoy Holding Corporation (NASDAQ: SJ) reported a 27.0% year-over-year increase in total net revenues for Q1 2022, reaching RMB 463.4 million (US$73.1 million). Gross profit rose 42.8% to RMB 114.5 million (US$18.1 million), with a gross margin of 24.7%. Net income increased by 17.3% to RMB 83.2 million (US$13.1 million). However, total paying users fell to 248,988 from 291,949 in 2021, and active broadcasters declined from 143,980 to 50,317. The company forecasts Q2 2022 revenues between RMB 438 million and RMB 478 million, subject to market and economic conditions.
- Total net revenues increased by 27.0% to RMB 463.4 million.
- Gross profit increased by 42.8% to RMB 114.5 million.
- Net income rose 17.3% to RMB 83.2 million.
- Gross margin improved to 24.7% from 22.0%.
- Total paying users decreased to 248,988 from 291,949.
- Active broadcasters fell to 50,317 from 143,980.
- Adjusted net income dropped to RMB 77.7 million from RMB 83.5 million.
Revenues up
BEIJING, June 30, 2022 /PRNewswire/ -- Scienjoy Holding Corporation ("Scienjoy", the "Company", or "We") (NASDAQ: SJ), a leading live entertainment mobile streaming platform in China, today announced its financial results for the first quarter ended March 31, 2022.
First Quarter 2022 Operating and Financial Highlights
- Total net revenues increased by
27.0% to RMB 463.4 million (US$73.1 million ) from RMB365.0 million in the same period of 2021, exceeding the high end of the estimated range for total net revenues released by the Company on May 17, 2022. - Gross profit increased by
42.8% to RMB114.5 million (US$18.1 million ) from RMB80.1 million in the same period of 2021. Gross margin increased to24.7% from22.0% in the same period of 2021. - Net income increased by
17.3% to RMB83.2 million (US$13.1 million ) from RMB71.0 million in the same period of 2021. - Adjusted net income decreased to RMB77.7 million (US
$12.3 million ) from RMB83.5 million in the same period of 2021. - Total paying users decreased to 248,988 from 291,949 in the same period of 2021.
- Total number of active broadcasters decreased to 50,317 from 143,980 in the same period of 2021.
- As of March 31, 2022, the Company had RMB205.4 million (US
$32.4 million ) in cash and cash equivalents, which represented a decrease from RMB240.9 million as of December 31, 2021.
Mr. Victor He, Chairman and Chief Executive Officer of Scienjoy, commented, "We started the new fiscal year by delivering solid results amid the resurgence of COVID-19 cases in China and the complex macro environment. In the first quarter of 2022, our financial metrics demonstrated strong resilience against market volatility and were a testimonial to our business strategies as we provided high-quality content across our platforms to our users. The acquisition of Hongle.tv showed the continuing execution in expanding our platform categories. We remain confident in our business model and our ability to add additional value to our broadcasters and users. We will continue to leverage the strengths of our strong position in the market to enhance and expand the relationship with our users and deliver high-quality content to them. Moreover, developing the metaverse project remains a key focus for us, which will integrate user experience with advanced technologies, attract more users, and enhance our brand awareness. Looking ahead to the remainder of 2022, fueled by our continuing focus on research and development (R&D), we believe our multiple live streaming platforms, integrated with our advanced technologies and content investment, will position Scienjoy well to generate more value for our shareholders in the long term."
Mr. Denny Tang, Chief Financial Officer of Scienjoy, added, "In the first quarter of 2022, we delivered a strong financial performance with a
First Quarter 2022 Financial Results
Total net revenues in the first quarter of 2022 increased by
Cost of revenues in the first quarter of 2022 increased by
Gross profit in the first quarter of 2022 increased by
Total operating expenses in the first quarter of 2022 increased by
- Sales and marketing expenses in the first quarter of 2022 decreased by
47.1% to RMB0.6 million (US$92,000) from RMB1.1 million in the same period of 2021, primarily due to fewer marketing activities. - General and administrative expenses in the first quarter of 2022 increased by
116.0% to RMB19.1 million (US$3.0 million ) from RMB8.8 million in the same period of 2021. This increase was mainly caused by more consulting and professional fees due to the expansion of the Company, as well as higher employee salary and welfare as compared to the same period of 2021. - Research and development expenses in the first quarter of 2022 increased by
75.8% to RMB16.8 million (US$2.7 million ) from RMB9.6 million in the same period of 2021. The increase was due to a higher R&D headcount and the Company had share based compensation of RMB2.0 million in the first quarter of 2022, no such expenses were incurred in the same period of 2021. - Recovery of doubtful accounts in the first quarter of 2022 was RMB0.3 million (US
$41,000) as compared to a provision for doubtful accounts of RMB0.4 million in the same period of 2021, as a result of the Company's increased collection efforts.
Income from operations in the first quarter of 2022 increased by
Change in fair value of contingent consideration in the first quarter of 2022 recorded a gain of RMB4.7 million (US
Change in fair value of warrant liabilities in the first quarter of 2022 recorded a gain of RMB4.5 million (US
Change in fair value of investment in the first quarter of 2022 decreased by
Net income in the first quarter of 2022 increased by
Adjusted net income in the first quarter of 2022, decreased to RMB77.7 million (US
Basic and diluted net income per ordinary share in the first quarter of 2022 were both RMB2.34(US
Adjusted basic and diluted net income per ordinary share in the first quarter of 2022 were both RMB2.18 (US
The Company adopted ASU 2016-02, Leases (Topic 842) on January 1, 2022. The guidance requires the lessee to record operating leases on the balance sheet with a right-of-use asset and corresponding liability for future payment obligations. The Company recognized right of use assets and lease liabilities of approximately RMB12.2 million and RMB11.7 million as of March 31, 2022.
As of March 31, 2022, the Company had cash and cash equivalents of RMB205.4 million (US
Business Outlook
The Company expects its total net revenues to be in the range of RMB 438 million to RMB 478 million in the second quarter of 2022. This forecast reflects the Company's current and preliminary views on the market and operational conditions, which are subject to change, particularly with respect to the potential impact of COVID-19 on the economy in China and other markets around the world.
Recent Developments
On December 29, 2021, the Company has entered into an equity acquisition framework agreement (the "Agreement") to acquire
About Scienjoy Holding Corporation
Founded in 2011, Scienjoy is a leading mobile livestreaming platform in China, and its core mission is to build a livestreaming service ecosystem to delight and entertain users. With over 300 million registered users, Scienjoy currently operates five livestreaming platform brands, including Showself, Lehai, Haixiu, and BeeLive, which features both the Mifeng Chinese version and BeeLive International version, and Hongle.tv. Scienjoy uniquely combines a gamified business approach to livestreaming, in-depth knowledge of the livestreaming industry, and cutting-edge technologies such as blockchain, augmented reality (AR), virtual reality (VR), and big data, to create a unique user experience. Scienjoy is devoted to building a livestreaming Metaverse to provide users with the ultimate immersive experience, a social media network that transcends time and space, a digital community that spans virtual and physical reality, and a content-rich ecosystem. For more information, please visit http://ir.scienjoy.com/.
Use of Non-GAAP Financial Measures
Adjusted net income is calculated as net income adjusted for change in fair value of contingent consideration, change in fair value of warrant liability and share based compensation. Adjusted basic and diluted net income per ordinary share is non-GAAP net income (loss) attributable to ordinary shareholders divided by the weighted average number of ordinary shares used in the calculation of non-GAAP basic and diluted net income per ordinary share. The non-GAAP financial measures are presented to enhance investors' overall understanding of the Company's financial performance and should not be considered a substitute for, or superior to, the financial information prepared and presented in accordance with U.S. GAAP. Investors are encouraged to review the reconciliation of the historical non-GAAP financial measures to its most directly comparable GAAP financial measures. As non-GAAP financial measures have material limitations as analytical metrics and may not be calculated in the same manner by all companies, they may not be comparable to other similarly titled measures used by other companies. In light of the foregoing limitations, you should not consider non-GAAP financial measures as a substitute for, or superior to, such metrics in accordance with US GAAP.
For more information on these non-GAAP financial measures, please see the table captioned "Reconciliations of Non-GAAP Results" near the end of this release.
Exchange Rate Information
This announcement contains translations of certain RMB amounts into U.S. dollars at a specified rate solely for the convenience of the reader. Unless otherwise noted, all translations from RMB to U.S. dollars are made at a rate of RMB6.3393 to US
Safe Harbor Statement
Certain statements made in this release are "forward looking statements" within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995. When used in this press release, the words "estimates," "projected," "expects," "anticipates," "forecasts," "plans," "intends," "believes," "seeks," "may," "will," "should," "future," "propose" and variations of these words or similar expressions (or the negative versions of such words or expressions) are intended to identify forward-looking statements. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside the Company's control, that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements. Important factors, among others, are: the ability to manage growth; ability to identify and integrate other future acquisitions; the ability to obtain additional financing in the future to fund capital expenditures; fluctuations in general economic and business conditions; costs or other factors adversely affecting the Company's profitability; litigation involving patents, intellectual property, and other matters; potential changes in the legislative and regulatory environment; a pandemic or epidemic. The forward-looking statements contained in this release are also subject to other risks and uncertainties, including those more fully described in the Company's filings with the Securities and Exchange Commission ("SEC") from time to time. The Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law. Such information speaks only as of the date of this release.
Investor Relations Contacts
Denny Tang
Chief Financial Officer
Scienjoy Holding Corporation
+86-10-64428188
ir@scienjoy.com
Tina Xiao
Ascent Investor Relations
+1 (917) 609-0333
tina.xiao@ascent-ir.com
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||||||
(All amounts in thousands, except share and per share data or otherwise stated) | ||||||||||||
As of | As of | |||||||||||
2021 | 2022 | 2022 | ||||||||||
RMB | RMB | USD | ||||||||||
ASSETS | ||||||||||||
Current assets | ||||||||||||
Cash and cash equivalents | 240,947 | 205,362 | 32,395 | |||||||||
Accounts receivable, net | 206,307 | 222,375 | 35,079 | |||||||||
Prepaid expenses and other current assets | 165,409 | 79,446 | 12,532 | |||||||||
Amounts due from related parties | 1,059 | 2,052 | 324 | |||||||||
Investment in marketable security | 38,789 | 39,250 | 6,192 | |||||||||
Total current assets | 652,511 | 548,485 | 86,522 | |||||||||
Property and equipment, net | 1,674 | 1,782 | 281 | |||||||||
Intangible assets, net | 235,870 | 424,172 | 66,911 | |||||||||
Goodwill | 92,069 | 172,781 | 27,256 | |||||||||
Long term investments | 101,727 | 176,979 | 27,918 | |||||||||
Long term deposits and other non-current assets | 1,152 | 1,190 | 188 | |||||||||
Deferred tax assets – non-current | 4,352 | 4,145 | 654 | |||||||||
Right of use assets | - | 12,245 | 1,932 | |||||||||
Total non-current assets | 436,844 | 793,294 | 125,140 | |||||||||
TOTAL ASSETS | 1,089,355 | 1,341,779 | 211,662 | |||||||||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||||||
Current liabilities | ||||||||||||
Accounts payable | 85,801 | 61,089 | 9,640 | |||||||||
Accrued salary and employee benefits | 24,533 | 30,182 | 4,761 | |||||||||
Accrued expenses and other current liabilities | 16,181 | 5,710 | 901 | |||||||||
Current portion of contingent consideration – earn-out liability | 10,638 | 17,538 | 2,767 | |||||||||
Warrant liabilities | 10,324 | 5,769 | 910 | |||||||||
Income tax payable | 8,282 | 13,711 | 2,163 | |||||||||
Deferred revenue | 65,405 | 80,891 | 12,760 | |||||||||
Lease liability-current | - | 4,377 | 690 | |||||||||
Total current liabilities | 221,164 | 219,267 | 34,592 | |||||||||
Non-current liabilities | ||||||||||||
Deferred tax liabilities | 58,746 | 62,299 | 9,827 | |||||||||
Contingent consideration – earn-out liability | - | 8,235 | 1,299 | |||||||||
Lease liability-non-current | -- | 7,334 | 1,157 | |||||||||
Total non-current liabilities | 58,746 | 77,868 | 12,283 | |||||||||
TOTAL LIABILITIES | 279,910 | 297,135 | 46,875 | |||||||||
Commitments and contingencies Shareholders' equity | ||||||||||||
Ordinary share, no par value, unlimited shares authorized, 34,743,152 and | ||||||||||||
Class A ordinary shares | 140,196 | 292,205 | 46,094 | |||||||||
Class B ordinary shares | 13,041 | 13,041 | 2,057 | |||||||||
Shares to be issued | 128,119 | 128,119 | 20,210 | |||||||||
Statutory reserves | 31,775 | 35,971 | 5,674 | |||||||||
Retained earnings | 479,199 | 558,229 | 88,058 | |||||||||
Accumulated other comprehensive income | 17,115 | 17,079 | 2,694 | |||||||||
Total shareholders' equity | 809,445 | 1,044,644 | 164,787 | |||||||||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | 1,089,355 | 1,341,779 | 211,662 | |||||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME | ||||||||||||
(All amounts in thousands, except share and per share data or otherwise stated) | ||||||||||||
For three months ended | ||||||||||||
March 31, | March 31, | March 31, | ||||||||||
2021 | 2022 | 2022 | ||||||||||
RMB | RMB | US$ | ||||||||||
Live streaming - consumable virtual items revenue | 354,236 | 445,339 | 70,250 | |||||||||
Live streaming - time based virtual items revenue | 9,098 | 7,465 | 1,178 | |||||||||
Technical services | 1,697 | 10,641 | 1,679 | |||||||||
Total revenues | 365,031 | 463,445 | 73,107 | |||||||||
Cost of revenues | (284,892) | (348,969) | (55,049) | |||||||||
Gross profit | 80,139 | 114,476 | 18,058 | |||||||||
Operating expenses | ||||||||||||
Sales and marketing expenses | (1,104) | (584) | (92) | |||||||||
General and administrative expenses | (8,847) | (19,108) | (3,014) | |||||||||
Recovery of (provision for) doubtful accounts | (448) | 259 | 41 | |||||||||
Research and development expenses | (9,563) | (16,815) | (2,653) | |||||||||
Total operating expenses | (19,962) | (36,248) | (5,718) | |||||||||
Income from operations | 60,177 | 78,228 | 12,340 | |||||||||
Change in fair value of contingent consideration | (11,778) | 4,740 | 748 | |||||||||
Change in fair value of warrants liability | (778) | 4,499 | 710 | |||||||||
Change in fair value of investment | 26,168 | 712 | 112 | |||||||||
Interest income | 738 | 496 | 78 | |||||||||
Interest expense | (117) | - | - | |||||||||
Other expenses, net | - | 60 | 9 | |||||||||
Foreign exchange gain (loss), net | (93) | 60 | 9 | |||||||||
Income before income taxes | 74,317 | 88,795 | 14,006 | |||||||||
Income tax expenses | (3,359) | (5,569) | (878) | |||||||||
Net income | 70,958 | 83,226 | 13,128 | |||||||||
Other comprehensive income - foreign currency translation adjustment | (486) | (36) | (6) | |||||||||
Comprehensive income attributable to the Company's shareholders | 70,472 | 83,190 | 13,122 | |||||||||
Weighted average number of shares | ||||||||||||
Basic | 30,582,611 | 35,612,100 | 35,612,100 | |||||||||
Diluted | 30,582,611 | 35,612,100 | 35,612,100 | |||||||||
Earnings per share | ||||||||||||
Basic | 2.32 | 2.34 | 0.37 | |||||||||
Diluted | 2.32 | 2.34 | 0.37 | |||||||||
Reconciliations of Non-GAAP Results | ||||||||||||
(All amounts in thousands, except share and per share data or otherwise stated) | ||||||||||||
For the three months ended | ||||||||||||
March 31, | March 31, | March 31, | ||||||||||
2021 | 2022 | 2022 | ||||||||||
RMB | RMB | US$ | ||||||||||
Net income | 70,958 | 83,226 | 13,128 | |||||||||
Less: | ||||||||||||
Change in fair value of contingent consideration | (11,778) | 4,740 | 748 | |||||||||
Change in fair value of warrants liability | (778) | 4,499 | 710 | |||||||||
Share based compensation | - | (3,726) | (588) | |||||||||
Adjusted net income * | 83,514 | 77,713 | 12,258 | |||||||||
Adjusted net income per ordinary share* | ||||||||||||
Basic | 2.73 | 2.18 | 0.34 | |||||||||
Diluted | 2.73 | 2.18 | 0.34 | |||||||||
"Adjusted net income" is defined as net income excluding change in fair value of contingent consideration, | ||||||||||||
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SOURCE Scienjoy Holding Corporation
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