Niu Technologies Announces Fourth Quarter and Full Year 2018 Financial Results
-- Fourth Quarter Total volume of e-scooter sales up 77.9% year over year
-- Fourth Quarter Total net revenues of
-- Full Year Total volume of e-scooter sales up 79.2% year over year
-- Full Year Total net revenues of
Fourth Quarter 2018 Financial Highlights
- Net revenues were
RMB 427.5 million , an increase of 95.0% year over year - Gross margin was 13.5%, compared with 4.4% in the fourth quarter of 2017
- Net loss was
RMB 32.0 million , improved byRMB 16.7 million compared with net loss ofRMB 48.7 million in the fourth quarter of 2017 - Adjusted net loss (non-GAAP)1 was
RMB 7.2 million , improved byRMB 20.3 million compared with adjusted net loss ofRMB 27.5 million in the fourth quarter of 2017
Fourth Quarter 2018 Operating Highlights
- The Company sold 93,611 e-scooters, up 77.9% year over year
- Franchised stores in
China reached 760, an increase of 118 sequentially - Overseas sales network expanded to 22 distributors covering 27 countries
- IPO completed on
October 19, 2018
Dr.
Dr. Li continued, “We accomplished much in our first quarter as a publicly-traded company. The IPO helped lift user brand awareness while also deepen distributor commitment. We opened 118 new franchised stores in
Fourth Quarter 2018 Financial Results
Net revenues were
- E-scooter sales represented 92.8% of net revenues, while the accessories and spare parts sales and service revenues represented 7.2% of net revenues
- Higher e-scooter sales were mainly driven by sales of new models launched in earlier quarters, as well as the expanded sales network
- Increased net revenues per e-scooter was mainly driven by higher retail prices for certain e-scooter models and a higher proportion of overseas sales
China represented 85.5% of the net revenues from e-scooter sales, and overseas markets represented 14.5%, compared with 6.9% from overseas markets in the fourth quarter of 2017
Cost of revenues were
Gross margin was 13.5%, a substantial increase from 4.4% in the same period of 2017, mainly driven by higher retail prices, lower raw material costs and a higher proportion of revenue from overseas market.
Operating expenses were
- Selling and marketing expenses were
RMB 41.8 million (includingRMB 0.5 million share-based compensation), an increase of 70.4% fromRMB 24.5 million in the fourth quarter of 2017. The increase was mainly attributable to the increases in advertising and promotion expense ofRMB 10.3 million , depreciation and amortization expense ofRMB 1.5 million and traveling expense ofRMB 1.4 million , which resulted from the growth in e-scooter sales volume, the opening of new franchised stores and branding activities for the Company IPO in October. The selling and marketing expenses as a percentage of net revenues was 9.8% compared with 11.2% in the fourth quarter of 2017. - Research and development expenses were
RMB 22.1 million (includingRMB 9.2 million share-based compensation), an increase of 153.4% fromRMB 8.7 million in the fourth quarter of 2017, mainly attributable to the increases in share-based compensation ofRMB 5.8 million , staff cost ofRMB 4.2 million and design expense ofRMB 2.1 million , which resulted from the Company’s continued efforts to enhance the research and development capability and accelerated vesting of certain restricted ordinary shares. The research and development expenses as a percentage of net revenues was 5.2%, compared with 4.0% in the fourth quarter of 2017. - General and administrative expenses were
RMB 26.7 million (includingRMB 15.0 million share-based compensation), an increase of 33.1% fromRMB 20.1 million in the fourth quarter of 2017, mainly attributable to the increases of share-based compensation expense ofRMB 3.6 million , staff cost ofRMB 1.9 million and professional fees ofRMB 1.5 million as a result of accelerated vesting of certain restricted ordinary shares, increases in number of staff and engagement of professional firms for post-IPO services. General and administrative expenses as a percentage of net revenues was 6.3%, compared with 9.2% in the fourth quarter of 2017.
Operating expenses excluding share-based compensation was
- Selling and marketing expenses excluding share-based compensation were
RMB 41.3 million , an increase of 71.3% year over year, and represented 9.7% of net revenues, compared with 11.0% in the fourth quarter of 2017 - Research and development expenses excluding share-based compensation were
RMB 12.9 million , an increase of 142.1% year over year, and represented 3.0% of net revenues, compared with 2.4% in the fourth quarter of 2017 - General and administrative expenses excluding share-based compensation were
RMB 11.7 million , an increase of 35.4% year over year, and represented 2.7% of net revenues, compared with 3.9% in the fourth quarter of 2017
Change in fair value of a convertible loan was nil, compared to a loss of
Share-based compensation was
Net loss was
Adjusted net loss (non-GAAP) was
Basic and diluted net loss per ADS were both
We have recently entered into a definitive Development Collaboration Agreement with
Full Year 2018 Financial Results
Net revenues were
Cost of revenues were
Gross margin was 13.4%, increased substantially from 7.1% in 2017, mainly driven by higher retail prices and change in product mix.
Operating expenses were
Operating expenses excluding share-based compensation was
Change in fair value of a convertible loan was a loss of
Share-based compensation was
Net loss was
Adjusted net loss (non-GAAP) was
Balance Sheet
As of
Business Outlook
For the first quarter of 2019, NIU expects net revenues to be in the range of
The above outlook is based on information available as of the date of this press release and reflects the Company’s current and preliminary expectation, which is subject to change.
Conference Call
The Company will host a conference call at
Participants may access the call via below dial-in details:
United States +1-866-519-4004
Hong Kong +852-800-906-601
Mainland China +86-400-620-8038
Other International +65-6713-5090
Conference ID 8141818
A replay will be accessible through
United States +1-855-452-5696
Hong Kong +852-800-963-117
Mainland China +86-400-602-2065
Other International +61-281-990-299
Replay Access Code 8141818
Additionally, a live and archived webcast of the conference call will also be available through the Company’s investor relations website at https://ir.niu.com/.
About NIU
As the world’s leading provider of smart urban mobility solutions, NIU designs, manufactures and sells high-performance smart e-scooters. NIU has a streamlined product portfolio consisting of three series, N, M and U that address the needs of different segments of the modern urban resident, while being united through a common design language that emphasizes style, freedom and technology. NIU has adopted an omnichannel retail model, integrating the offline and online channels, to sell its products and provide services. For more information, please visit www.niu.com.
Use of Non-GAAP Financial Measures
To supplement NIU’s consolidated financial results presented in accordance with the accounting principles generally accepted in
NIU believes that these non-GAAP financial measures provide meaningful supplemental information regarding its performance and liquidity by excluding certain items that may not be indicative of its operating results. The Company believes that both management and investors benefit from referring to these non-GAAP financial measures in assessing its performance and when planning and forecasting future periods. These non-GAAP financial measures also facilitate management’s internal comparisons to NIU’s historical performance. The Company believes these non-GAAP financial measures are useful to investors in allowing for greater transparency with respect to supplemental information used by management in its financial and operational decision making. A limitation of using these non-GAAP financial measures is that these non-GAAP measures exclude certain items that have been and will continue to be for the foreseeable future a significant component in the Company’s results of operations. These non-GAAP financial measures presented here may not be comparable to similarly titled measures presented by other companies. Other companies may calculate similarly titled measures differently, limiting their usefulness as comparative measures to the Company’s data.
Adjusted net loss is defined as net loss excluding share-based compensation expenses and change in fair value of a convertible loan. Adjusted net loss margin is defined as adjusted net loss as a percentage of the net revenues. Adjusted basic and diluted net loss per ADS is defined as basic and diluted net loss per ADS excluding share-based compensation expenses and change in fair value of a convertible loan.
For more information on non-GAAP financial measures, please see the tables captioned “Reconciliations of non-GAAP financial measures to the nearest comparable GAAP measures.”
Exchange Rate
This announcement contains translations of certain RMB amounts into U.S. dollars (“US$”) at specified rates solely for the convenience of the readers. Unless otherwise stated, all translations from RMB to US$ were made at the rate of
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. These forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “aims,” “future,” “intends,” “plans,” “believes,” “estimates,” “likely to” and similar statements. Among other things, the business outlook and quotations from management in this announcement, as well as NIU’s strategic and operational plans, contain forward-looking statements. NIU may also make written or oral forward-looking statements in its periodic reports to the
Investor Relations Contacts:
NIU
Investor Relations Manager
E-mail: ir@niu.com
E-mail: gary@blueshirtgroup.com
NIU TECHNOLOGIES | ||||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||
As of December 31, | As of December 31, | |||||
2017 | 2018 | |||||
RMB | RMB | US$ | ||||
ASSETS | ||||||
Current assets | ||||||
Cash | 111,996,325 | 569,059,591 | 82,766,285 | |||
Term deposit | - | 27,452,663 | 3,992,824 | |||
Restricted cash-current | 104,547,200 | 179,262,714 | 26,072,680 | |||
Short-term investments | 85,187,718 | 120,241,425 | 17,488,390 | |||
Accounts receivable, net | 10,382,112 | 54,424,845 | 7,915,765 | |||
Inventories | 88,225,965 | 142,382,205 | 20,708,633 | |||
Prepayments and other current assets | 7,349,583 | 26,919,954 | 3,915,345 | |||
Total current assets | 407,688,903 | 1,119,743,397 | 162,859,922 | |||
Non-current assets | ||||||
Restricted cash-non current | 65,342,000 | - | - | |||
Property and equipment, net | 28,696,602 | 40,985,174 | 5,961,046 | |||
Intangible assets, net | 1,277,467 | 7,717,754 | 1,122,501 | |||
Other non-current assets | 626,605 | 16,805,474 | 2,444,255 | |||
Total non-current assets | 95,942,674 | 65,508,402 | 9,527,802 | |||
Total assets | 503,631,577 | 1,185,251,799 | 172,387,724 | |||
LIABILITIES | ||||||
Current liabilities | ||||||
Short-term bank borrowings | 168,234,207 | 179,978,003 | 26,176,715 | |||
Convertible loan | 151,557,796 | - | - | |||
Accounts payable | 124,937,465 | 249,665,890 | 36,312,398 | |||
Advance from customers | 48,503,389 | 20,505,861 | 2,982,454 | |||
Deferred revenue-current | 9,853,361 | 12,666,330 | 1,842,241 | |||
Accrued expenses and other current liabilities | 75,412,869 | 134,184,026 | 19,516,257 | |||
Total current liabilities | 578,499,087 | 597,000,110 | 86,830,065 | |||
Warranty-non current | 12,378,751 | 17,609,842 | 2,561,245 | |||
Deferred revenue - non current | 144,700 | 234,801 | 34,150 | |||
Total non-current liabilities | 12,523,451 | 17,844,643 | 2,595,395 | |||
Total liabilities | 591,022,538 | 614,844,753 | 89,425,460 | |||
MEZZANINE EQUITY | ||||||
Series A-1 Redeemable Convertible Preferred Shares | 130,684,003 | - | - | |||
Series A-2 Redeemable Convertible Preferred Shares | 39,205,192 | - | - | |||
Series A-3 Redeemable Convertible Preferred Shares | 67,955,320 | - | - | |||
Total mezzanine equity | 237,844,515 | - | - | |||
SHAREHOLDERS’ (DEFICIT)/EQUITY: | ||||||
Ordinary Shares | 39,948 | - | - | |||
Class A ordinary shares | - | 83,120 | 12,089 | |||
Class B ordinary shares | - | 12,839 | 1,867 | |||
Series Seed Convertible Preferred Shares | 18,436 | - | - | |||
Additional paid-in capital | 440,265,896 | 1,717,483,548 | 249,797,622 | |||
Accumulated other comprehensive income/(loss) | 5,596,238 | (22,786,922 | ) | (3,314,220 | ) | |
Accumulated deficit | (771,155,994 | ) | (1,124,385,539 | ) | (163,535,094 | ) |
Total shareholders’ (deficit)/equity | (325,235,476 | ) | 570,407,046 | 82,962,264 | ||
Total liabilities, mezzanine equity and shareholders’ (deficit)/equity | 503,631,577 | 1,185,251,799 | 172,387,724 | |||
NIU TECHNOLOGIES | ||||||||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS | ||||||||||||
Three months ended December 31, | Twelve months ended December 31, | |||||||||||
2017 | 2018 | 2017 | 2018 | |||||||||
RMB | RMB | US$ | RMB | RMB | US$ | |||||||
Net revenues | 219,245,438 | 427,505,084 | 62,178,036 | 769,368,001 | 1,477,781,304 | 214,934,376 | ||||||
Cost of revenues(a) | (209,550,877 | ) | (369,961,904 | ) | (53,808,727 | ) | (714,669,718 | ) | (1,279,155,847 | ) | (186,045,502 | ) |
Gross profit | 9,694,561 | 57,543,180 | 8,369,309 | 54,698,283 | 198,625,457 | 28,888,874 | ||||||
Operating expenses: | ||||||||||||
Selling and marketing expenses(a) | (24,525,340 | ) | (41,802,946 | ) | (6,079,986 | ) | (83,064,894 | ) | (150,150,872 | ) | (21,838,539 | ) |
Research and development expenses(a) | (8,724,895 | ) | (22,105,334 | ) | (3,215,087 | ) | (39,492,743 | ) | (91,811,892 | ) | (13,353,486 | ) |
General and administrative expenses(a) | (20,082,841 | ) | (26,733,610 | ) | (3,888,242 | ) | (76,411,871 | ) | (274,110,654 | ) | (39,867,741 | ) |
Operating loss | (43,638,515 | ) | (33,098,710 | ) | (4,814,006 | ) | (144,271,225 | ) | (317,447,961 | ) | (46,170,892 | ) |
Changes in fair value of a convertible loan | (5,873,254 | ) | - | - | (43,006,399 | ) | (34,499,858 | ) | (5,017,796 | ) | ||
Interest expense | (1,250,223 | ) | (1,458,859 | ) | (212,182 | ) | (3,153,521 | ) | (7,721,675 | ) | (1,123,071 | ) |
Interest income | 247,383 | 1,080,106 | 157,095 | 1,006,972 | 2,998,796 | 436,157 | ||||||
Investment income | 917,428 | 1,692,537 | 246,169 | 2,315,536 | 4,601,849 | 669,311 | ||||||
Foreign currency exchange gain/(losses) | 887,229 | (298,349 | ) | (43,393 | ) | 1,612,766 | 1,646,173 | 239,426 | ||||
Government grants | - | 84,100 | 12,232 | 833,000 | 1,395,200 | 202,923 | ||||||
Loss before income taxes | (48,709,952 | ) | (31,999,175 | ) | (4,654,085 | ) | (184,662,871 | ) | (349,027,476 | ) | (50,763,942 | ) |
Income tax expense | - | - | - | - | - | - | ||||||
Net loss | (48,709,952 | ) | (31,999,175 | ) | (4,654,085 | ) | (184,662,871 | ) | (349,027,476 | ) | (50,763,942 | ) |
Other comprehensive income/(losses) | ||||||||||||
Foreign currency translation adjustment, net of nil income taxes | 2,690,014 | (10,117,727 | ) | (1,471,562 | ) | 9,994,461 | (28,436,867 | ) | (4,135,971 | ) | ||
Unrealized gain on available for sale securities, net of nil income taxes | 759,538 | 1,351,839 | 196,617 | 2,415,901 | 4,655,556 | 677,123 | ||||||
Less: reclassification adjustment for gain on available for sale securities realized in net income, net of nil income taxes | (917,428 | ) | (1,692,537 | ) | (246,169 | ) | (2,315,536 | ) | (4,601,849 | ) | (669,311 | ) |
Comprehensive loss | (46,177,828 | ) | (42,457,600 | ) | (6,175,199 | ) | (174,568,045 | ) | (377,410,636 | ) | (54,892,101 | ) |
Net loss per share | ||||||||||||
—Basic and diluted | (1.528 | ) | (0.245 | ) | (0.036 | ) | (7.023 | ) | (5.302 | ) | (0.771 | ) |
Net loss per ADS | ||||||||||||
—Basic and diluted | - | (0.489 | ) | (0.071 | ) | - | (10.603 | ) | (1.542 | ) | ||
Weighted average number of shares outstanding used in computing net loss per share | ||||||||||||
—Basic and diluted | 31,881,510 | 130,780,142 | 130,780,142 | 26,295,181 | 65,834,876 | 65,834,876 | ||||||
Weighted average number of ADS outstanding used in computing net loss per ADS | ||||||||||||
—Basic and diluted | - | 65,390,071 | 65,390,071 | - | 32,917,438 | 32,917,438 | ||||||
Note: | ||||||||||||
(a) Includes share-based compensation expenses as follows: | ||||||||||||
Three months ended December 31, | Twelve months ended December 31, | |||||||||||
2017 | 2018 | 2017 | 2018 | |||||||||
RMB | RMB | US$ | RMB | RMB | US$ | |||||||
Cost of revenues | 62,493 | 62,208 | 9,048 | 253,545 | 246,947 | 35,917 | ||||||
Selling and marketing expenses | 430,998 | 519,621 | 75,576 | 1,611,160 | 2,124,728 | 309,029 | ||||||
Research and development expenses | 3,396,179 | 9,204,100 | 1,338,681 | 13,878,635 | 52,864,313 | 7,688,795 | ||||||
General and administrative expenses | 11,448,415 | 15,046,141 | 2,188,370 | 46,783,758 | 210,638,939 | 30,636,163 | ||||||
Total share-based compensation | 15,338,085 | 24,832,070 | 3,611,675 | 62,527,098 | 265,874,927 | 38,669,904 |
NIU TECHNOLOGIES | ||||||||||||
RECONCILIATION OF GAAP AND NON-GAAP RESULTS | ||||||||||||
Three months ended December 31, | Twelve months ended December 31, | |||||||||||
2017 | 2018 | 2017 | 2018 | |||||||||
RMB | RMB | US$ | RMB | RMB | US$ | |||||||
Net loss | (48,709,952 | ) | (31,999,175 | ) | (4,654,085 | ) | (184,662,871 | ) | (349,027,476 | ) | (50,763,942 | ) |
Add: | ||||||||||||
Share-based compensation | 15,338,085 | 24,832,070 | 3,611,675 | 62,527,098 | 265,874,927 | 38,669,904 | ||||||
Change in fair value of a convertible loan | 5,873,254 | - | - | 43,006,399 | 34,499,858 | 5,017,796 | ||||||
Adjusted net loss | (27,498,613 | ) | (7,167,105 | ) | (1,042,410 | ) | (79,129,374 | ) | (48,652,691 | ) | (7,076,242 | ) |
Adjusted net loss per share | ||||||||||||
—Basic and diluted | (0.863 | ) | (0.055 | ) | (0.008 | ) | (3.009 | ) | (0.739 | ) | (0.107 | ) |
Adjusted net loss per ADS | ||||||||||||
—Basic and diluted | - | (0.110 | ) | (0.016 | ) | - | (1.478 | ) | (0.215 | ) | ||
Weighted average number of shares outstanding used in computing adjusted net loss per share | ||||||||||||
—Basic and diluted | 31,881,510 | 130,780,142 | 130,780,142 | 26,295,181 | 65,834,876 | 65,834,876 | ||||||
Weighted average number of ADS outstanding used in computing adjusted net loss per ADS | ||||||||||||
—Basic and diluted | - | 65,390,071 | 65,390,071 | - | 32,917,438 | 32,917,438 |
_______________________________
1 Adjusted net loss (non-GAAP) is defined as net loss excluding share-based compensation expenses and change in fair value of a convertible loan.
2 Adjusted net loss margin is defined as adjusted net loss as a percentage of the net revenues.
3 Adjusted net loss margin is defined as adjusted net loss as a percentage of the net revenues.
Source: Niu Technologies