Yunji Announces First Quarter 2024 Unaudited Financial Results
Yunji (NASDAQ: YJ) announced its unaudited financial results for Q1 2024, ending March 31, 2024. The company's total revenues were RMB 127.9 million (US$17.7 million), a decline compared to RMB 178.7 million in Q1 2023. This drop is attributed to soft consumer confidence and strategic optimization in product selection and supplier management. Despite lower revenues, Yunji achieved a net income of RMB 3.9 million (US$0.5 million), reversing a net loss of RMB 22.9 million in the same period last year. Additionally, the company reported a stable gross margin and decreased total operating expenses by 11% to RMB 75.9 million (US$10.5 million). Yunji also announced the acquisition of land in Hangzhou for new headquarters construction, costing RMB 171.5 million.
- Net income of RMB 3.9 million (US$0.5 million), compared to a net loss of RMB 22.9 million in Q1 2023.
- Stable gross margin maintained during the quarter.
- Total cost of revenues decreased by 30.7% to RMB 64.7 million (US$9.0 million).
- Total operating expenses decreased by 11% to RMB 75.9 million (US$10.5 million).
- Fulfillment expenses decreased by 19.2% to RMB 21.9 million (US$3.0 million).
- Financial income, net was RMB 14.7 million (US$2.0 million), compared with a financial loss of RMB 22.2 million in Q1 2023.
- Acquisition of land in Hangzhou for new headquarters, enhancing future operational capacity.
- Total revenues decreased by 28.5% to RMB 127.9 million (US$17.7 million) from RMB 178.7 million in Q1 2023.
- Revenues from sales of merchandise decreased by 28.7% to RMB 102.0 million (US$14.1 million).
- Revenues from the marketplace business decreased by 26.7% to RMB 24.1 million (US$3.3 million).
- Other revenues decreased by 35.7% to RMB 1.8 million (US$0.3 million).
- Loss from operations was RMB 9.3 million (US$1.3 million), compared with income from operations of RMB 1.0 million in Q1 2023.
- Acquisition and construction costs for the new headquarters expected to be approximately RMB 600.0 million, impacting financials in the near term.
Insights
Yunji's financial results for the first quarter of 2024 show a notable decrease in total revenues from RMB178.7 million in Q1 2023 to RMB127.9 million in Q1 2024. This decrease is linked to soft consumer confidence and the company's strategy to refine its product selection and optimize suppliers and merchants. While the repeat purchase rate remains high at 74.4%, the company faces a significant challenge in restoring revenue growth. Despite a decrease in total operating expenses and cost of revenues, the company's operational loss of RMB9.3 million and a narrower net income of RMB3.9 million indicate a mixed financial health. The acquisition of a land use right for RMB171.5 million and the planned construction of a new headquarters might lead to increased capital expenditures that could strain cash reserves and necessitate bank financing. This could be a concern for investors looking at the company's liquidity and cash flow management. Additionally, the company's use of non-GAAP measures, while providing some valuable insights into core operations, does not fully account for all operational costs, which could potentially mislead less savvy investors regarding the company's true financial health.
The company's strategy shift towards refining product selection and optimizing suppliers has short-term revenue impact but aims for long-term stability and growth. While the reduction in sales and marketing expenses indicates cost control measures, the increased business promotion expenses suggest a strategic push to attract and retain customers. However, the company's performance should be evaluated within the context of the broader e-commerce market in China, which is highly competitive with players like Alibaba and JD.com. The reduced warehousing and logistics expenses are positive, indicating efficiency improvements, but also reflect lower sales volumes. The acquisition of the land use right is a strategic move for long-term growth, but it might come with short-term financial strain given the substantial investment required. Investors should weigh these factors and consider the potential benefits of the new headquarters versus the immediate financial impact.
First Quarter 2024 Highlights
- Total revenues in the first quarter of 2024 were
RMB127.9 million (US ), compared with$17.7 million RMB178.7 million in the same period of 2023. The change was primarily due to soft consumer confidence and the Company's continued strategy to refine its product selection across all categories and optimize its selection of suppliers and merchants, which had a near-term impact on sales. - Repeat purchase rate[2] in the twelve months ended March 31, 2024 was
74.4% .
Mr. Shanglue Xiao, Chairman and Chief Executive Officer of Yunji, said, "Last month, we celebrated Yunji's ninth anniversary, marking this milestone with the unveiling of new initiatives and fresh visions. We are dedicated to working closely with our employees and service managers to further cultivate and grow our business in the beauty and healthcare sectors."
"During the quarter, we maintained a stable gross margin. We will continue to refine our operations while efficiently managing our assets," said Mr. Yeqing Cui, Senior Financial Director of Yunji.
First Quarter 2024 Unaudited Financial Results
Total revenues were
- Revenues from sales of merchandise were
RMB102.0 million (US ), compared with$14.1 million RMB143.0 million in the same period of 2023. - Revenues from the marketplace business were
RMB24.1 million (US ), compared with$3.3 million RMB32.9 million in the same period of 2023. - Other revenues were
RMB1.8 million (US ), compared with$0.3 million RMB2.8 million in the same period of 2023.
Total cost of revenues decreased by
Total operating expenses decreased by
- Fulfillment expenses decreased by
19.2% toRMB21.9 million (US ), or$3.0 million 17.1% of total revenues, fromRMB27.1 million , or15.2% of total revenues, in the same period of 2023. The decrease was mainly due to (i) reduced warehousing and logistics expenses due to lower merchandise sales, and (ii) reduced personnel costs as a result of staffing structure refinements. - Sales and marketing expenses decreased by
12.8% toRMB25.8 million (US ), or$3.6 million 20.2% of total revenues, fromRMB29.6 million , or16.6% of total revenues, in the same period of 2023. The decrease was mainly due to the reduction in member management fees, partially offset by an increase in business promotion expenses. - Technology and content expenses decreased by
0.2% toRMB13.3 million (US ), or$1.8 million 10.4% of total revenues, fromRMB13.4 million , or7.5% of total revenues, in the same period of 2023. - General and administrative expenses decreased by
2.0% toRMB14.9 million (US ), or$2.1 million 11.6% of total revenues, fromRMB15.2 million , or8.5% of total revenues, in the same period of 2023. The decrease was mainly due to the reduction in personnel costs as a result of staffing structure refinements, partially offset by an increase in the allowance for credit losses.
Loss from operations was
Financial income, net was
Net income was
Adjusted net income (non-GAAP)[3] was
Basic and diluted net income per share attributable to ordinary shareholders were both nil, compared with basic and diluted net loss per share of
Acquisition of Land Use Right
In June 2024, the Company won the bid for a parcel of land located in Xiaoshan District,
Use of Non-GAAP Financial Measures
In evaluating the business, the Company considers and uses adjusted net income/(loss) as a supplemental measure to review and assess operating performance. The presentation of this non-GAAP financial measure is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with
The Company presents adjusted net income/(loss) because it is used by management to evaluate operating performance and formulate business plans. Adjusted net income/(loss) enables management to assess operating performance without considering the impact of share-based compensation recorded under ASC 718, "Compensation-Stock Compensation." The Company also believes that the use of this non-GAAP measure facilitates investors' assessment of operating performance.
This non-GAAP financial measure is not defined under
The Company compensates for these limitations by reconciling the non-GAAP financial measure to the nearest
For more information on the non-GAAP financial measures, please see the table captioned "Reconciliation of Non-GAAP Measures to the Most Directly Comparable Financial Measures" set forth at the end of this press release.
Conference Call
The Company will host a conference call on Tuesday, June 11, 2024, at 7:30 A.M. Eastern Time or 7:30 P.M.
International: | 1-412-902-4272 |
United States Toll Free: | 1-888-346-8982 |
Mainland China Toll Free: | 4001-201203 |
Hong Kong Toll Free: | 800-905945 |
Conference ID: | Yunji Inc. |
A telephone replay of the call will be available after the conclusion of the conference call for one week.
Dial-in numbers for the replay are as follows:
United States Toll Free | 1-877-344-7529 |
International | 1-412-317-0088 |
Replay Access Code | 4223382 |
Safe Harbor Statements
This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the
About Yunji Inc.
Yunji Inc. is a leading social e-commerce platform in
For more information, please visit https://investor.yunjiglobal.com/
Investor Relations Contact
Yunji Inc.
Investor Relations
Email: Yunji.IR@icrinc.com
Phone: +1 (646) 224-6957
ICR, LLC
Robin Yang
Email: Yunji.IR@icrinc.com
Phone: +1 (646) 224-6957
YUNJI INC. | ||||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||
(All amounts in thousands, except for share and per share data, unless otherwise noted) | ||||||
As of | ||||||
December 31, 2023 | March 31, 2024 | |||||
RMB | RMB | US$ | ||||
ASSETS | ||||||
Current Assets | ||||||
Cash and cash equivalents | 517,542 | 478,833 | 66,318 | |||
Restricted cash | 27,169 | 26,196 | 3,628 | |||
Short-term investments | 7,195 | 245 | 34 | |||
Accounts receivable, net (Allowance for | 64,312 | 71,163 | 9,856 | |||
Advance to suppliers | 14,058 | 11,224 | 1,555 | |||
Inventories, net | 42,716 | 35,686 | 4,942 | |||
Amounts due from related parties | 1,361 | 1,990 | 276 | |||
Prepaid expenses and other current assets[4] | 134,247 | 154,614 | 21,414 | |||
Total current assets | 808,600 | 779,951 | 108,023 | |||
Non-current assets | ||||||
Property and equipment, net | 175,451 | 175,259 | 24,273 | |||
Long-term investments | 364,159 | 375,316 | 51,981 | |||
Operating lease right-of-use assets, net | 16,507 | 15,672 | 2,169 | |||
Other non-current assets (Allowance for | 189,067 | 172,301 | 23,863 | |||
Total non-current assets | 745,184 | 738,548 | 102,286 | |||
Total assets | 1,553,784 | 1,518,499 | 210,309 | |||
YUNJI INC. | ||||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (CONTINUED) | ||||||
(All amounts in thousands, except for share and per share data, unless otherwise noted) | ||||||
As of | ||||||
December 31, 2023 | March 31, 2024 | |||||
RMB | RMB | US$ | ||||
LIABILITIES AND SHAREHOLDERS' | ||||||
Current Liabilities | ||||||
Accounts payable | 96,782 | 82,783 | 11,465 | |||
Deferred revenue | 9,412 | 10,538 | 1,459 | |||
Incentive payables to members[5] | 124,889 | 100,027 | 13,854 | |||
Member management fees payable | 4,373 | 3,901 | 540 | |||
Other payable and accrued liabilities | 109,200 | 107,923 | 14,947 | |||
Amounts due to related parties | 3,535 | 3,190 | 442 | |||
Operating lease liabilities - current | 3,376 | 3,416 | 473 | |||
Total current liabilities | 351,567 | 311,778 | 43,180 | |||
Non-current liabilities | ||||||
Operating lease liabilities | 11,122 | 11,252 | 1,558 | |||
Total non-current liabilities | 11,122 | 11,252 | 1,558 | |||
Total Liabilities | 362,689 | 323,030 | 44,738 |
YUNJI INC. | ||||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (CONTINUED) | ||||||
(All amounts in thousands, except for share and per share data, unless otherwise noted) | ||||||
As of | ||||||
December 31, 2023 | March 31, 2024 | |||||
RMB | RMB | US$ | ||||
Shareholders' equity | ||||||
Ordinary shares | 70 | 70 | 10 | |||
Less: Treasury stock | (116,108) | (116,045) | (16,072) | |||
Additional paid-in capital | 7,328,680 | 7,327,734 | 1,014,879 | |||
Statutory reserve | 16,254 | 16,254 | 2,251 | |||
Accumulated other comprehensive income | 85,291 | 86,706 | 12,009 | |||
Accumulated deficit | (6,123,971) | (6,120,131) | (847,628) | |||
Total Yunji Inc. shareholders' equity | 1,190,216 | 1,194,588 | 165,449 | |||
Non-controlling interests | 879 | 881 | 122 | |||
Total shareholders' equity | 1,191,095 | 1,195,469 | 165,571 | |||
Total liabilities and shareholders' equity | 1,553,784 | 1,518,499 | 210,309 |
YUNJI INC. | ||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS)/INCOME | ||||||
(All amounts in thousands, except for share and per share data, unless otherwise noted) | ||||||
For the Three Months Ended | ||||||
March 31, 2023 | March 31, 2024 | |||||
RMB | RMB | US$ | ||||
Revenues: | ||||||
Sales of merchandise, net | 142,958 | 102,046 | 14,133 | |||
Marketplace revenue | 32,957 | 24,057 | 3,332 | |||
Other revenues | 2,829 | 1,755 | 243 | |||
Total revenues | 178,744 | 127,858 | 17,708 | |||
Operating cost and expenses: | ||||||
Cost of revenues | (93,462) | (64,745) | (8,967) | |||
Fulfilment | (27,118) | (21,908) | (3,034) | |||
Sales and marketing | (29,585) | (25,808) | (3,574) | |||
Technology and content | (13,352) | (13,326) | (1,846) | |||
General and administrative | (15,172) | (14,835) | (2,055) | |||
Total operating cost and expenses | (178,689) | (140,622) | (19,476) | |||
Other operating income | 909 | 3,432 | 475 | |||
Income/(loss) from operations | 964 | (9,332) | (1,293) | |||
Financial (loss)/income, net | (22,192) | 14,665 | 2,031 | |||
Foreign exchange income/(loss), net | 2,363 | (241) | (33) | |||
Other non-operating income, net | 486 | - | - | |||
(Loss)/Income before income tax | (18,379) | 5,092 | 705 | |||
Income tax expense | (3,079) | (331) | (46) | |||
Equity in loss of affiliates, net of tax | (1,475) | (896) | (124) | |||
Net (loss)/income | (22,933) | 3,865 | 535 | |||
Less: net income attributable to non- | - | 2 | - | |||
Net (loss)/income attributable to | (22,933) | 3,863 | 535 |
YUNJI INC. | ||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS)/INCOME | ||||||
(All amounts in thousands, except for share and per share data, unless otherwise noted) | ||||||
For the Three Months Ended | ||||||
March 31, 2023 | March 31, 2024 | |||||
RMB | RMB | US$ | ||||
Net (loss)/income attributable to | (22,933) | 3,863 | 535 | |||
Net (loss)/income | (22,933) | 3,865 | 535 | |||
Other comprehensive (loss)/income | ||||||
Foreign currency translation | (11,927) | 1,415 | 196 | |||
Total comprehensive (loss)/income | (34,860) | 5,280 | 731 | |||
Less: total comprehensive income | - | 2 | - | |||
Total comprehensive (loss)/income | (34,860) | 5,278 | 731 | |||
Net (loss)/income attributable to | (22,933) | 3,863 | 535 | |||
Weighted average number of | 1,983,680,743 | 1,967,014,878 | 1,967,014,878 | |||
Net loss per share attributable to | ||||||
Basic | (0.01) | - | - | |||
Diluted | (0.01) | - | - |
YUNJI INC. | ||||||
NOTES TO UNAUDITED FINANCIAL INFORMATION | ||||||
(All amounts in thousands, except for share and per share data, unless otherwise noted) | ||||||
For the Three Months Ended | ||||||
March 31, 2023 | March 31, 2024 | |||||
RMB | RMB | US$ | ||||
Share-based compensation | ||||||
Technology and content | (139) | 420 | 58 | |||
General and administrative | (715) | (1,248) | (173) | |||
Fulfillment | (2,820) | (118) | (16) | |||
Sales and marketing | (631) | 63 | 9 | |||
Total | (4,305) | (883) | (122) |
YUNJI INC. | ||||||
RECONCILIATION OF NON-GAAP MEASURES TO THE MOST DIRECTLY COMPARABLE FINANCIAL MEASURES | ||||||
(All amounts in thousands, except for share and per share data, unless otherwise noted) | ||||||
For the Three Months Ended | ||||||
March 31, 2023 | March 31, 2024 | |||||
RMB | RMB | US$ | ||||
Reconciliation of Net (Loss)/Income to Adjusted Net | ||||||
Net (loss)/income | (22,933) | 3,865 | 535 | |||
Add: Share-based compensation | (4,305) | (883) | (122) | |||
Adjusted net (loss)/income | (27,238) | 2,982 | 413 |
[1]. This announcement contains translations of certain Renminbi (RMB) amounts into |
[2]. "Repeat purchase rate" in a given period is calculated as the number of transacting members who purchased not less than twice divided by the total number of transacting members during such period. "Transacting member" in a given period refers to a member who successfully promotes Yunji's products to generate at least one order or places at least one order on Yunji's platform, regardless of whether any product in such order is ultimately sold or delivered or whether any product in such order is returned. "Repeat purchase rate" only considers orders placed through the Company's app. Repeat purchases made through the Company's mini-programs are excluded from the calculation. |
[3]. Adjusted net income is a non-GAAP financial measure, which is defined as net income excluding share-based compensation expense. See "Reconciliation of Non-GAAP Measures to the Most Directly Comparable Financial Measures" set forth at the end of this press release. |
[4]. As of March 31, 2024, Short-term loan receivables of amount |
[5]. As of March 31, 2024, the decrease in incentive payables was mainly due to derecognition of long-aged payables to inactive members. |
[6]. As of March 31, 2024, the Group, as one of the five co-defendants, was involved in an on-going legal proceeding that arose in the ordinary course of business (the "Case"). The plaintiff sought monetary damages jointly and severally from all co-defendants. As of the date of this earnings release, the Case is still under the appeal trial process and subject to final judgment by the Guangzhou Intermediate People's Court, and the amount involved is approximately |
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SOURCE Yunji Inc.
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