21Vianet Group, Inc. Reports Unaudited Fourth Quarter and Full Year 2019 Financial Results
BEIJING,
Fourth Quarter 2019 Financial Highlights
- Net revenues increased by 16.2% to
RMB1.05 billion (US$150.6 million ) fromRMB901.9 million in the same period of 2018.
- Adjusted cash gross profit increased by 4.1% to
RMB425.9 million (US$61.2 million ) fromRMB409.2 million in the same period of 2018. Adjusted cash gross margin was 40.6%, compared to 45.4% in the same period of 2018.
- Adjusted EBITDA (non-GAAP) increased by 3.3% to
RMB263.8 million (US$37.9 million ) fromRMB255.3 million in the same period of 2018. Adjusted EBITDA margin was 25.2%, compared to 28.3% in the same period of 2018.
- Net cash generated from operating activities was
RMB444.8 million (US$63.9 million ), compared toRMB237.0 million in the same period of 2018.
Full Year 2019 Financial Highlights
- Net revenues increased by 11.4% to
RMB3.79 billion (US$544.3 million ) fromRMB3.40 billion in the full year of 2018.
- Adjusted cash gross profit increased by 8.0% to
RMB1.63 billion (US$234.6 million ) fromRMB1.51 billion in the full year of 2018. Adjusted cash gross margin was 43.1%, compared to 44.5% in the full year of 2018.
- Adjusted EBITDA increased by 14.5% to
RMB1.05 billion (US$150.9 million ) fromRMB917.7 million in the full year of 2018. Adjusted EBITDA margin expanded to 27.7% from 27.0% in the full year of 2018.
- Net cash generated from operating activities was
RMB707.4 million (US$101.6 million ), compared toRMB705.0 million in the full year of 2018.
Fourth Quarter 2019 Operational Highlights
- Hosting MRR1 per cabinet increased to
RMB8,822 in the fourth quarter of 2019, compared toRMB8,457 in the same period of 2018 andRMB8,711 in the third quarter of 2019.
- Total cabinets under management increased to 36,291 as of
December 31, 2019 , compared to 32,116 as ofSeptember 30, 2019 , and 30,654 as ofDecember 31, 2018 . As ofDecember 31, 2019 , the Company had 32,047 cabinets in its self-built data centers and 4,244 cabinets in its partnered data centers.
- Utilization rate in the fourth quarter of 2019 fell slightly to 65.6% from 66.2% in the third quarter of 2019, mainly due to the delivery of a large number of additional cabinets in the fourth quarter of 2019.
Mr.
Ms.
Fourth Quarter 2019 Financial Results
REVENUES: Net revenues in the fourth quarter of 2019 increased by 16.2% to
GROSS PROFIT: Gross profit in the fourth quarter of 2019 was
ADJUSTED CASH GROSS PROFIT, which excludes depreciation, amortization, and share-based compensation expenses, increased by 4.1% to
OPERATING EXPENSES: Total operating expenses in the fourth quarter of 2019 was
Sales and marketing expenses in the fourth quarter of 2019 increased by 28.4% to
Research and development expenses in the fourth quarter of 2019 were
General and administrative expenses in the fourth quarter of 2019 were
ADJUSTED OPERATING EXPENSES, which exclude share-based compensation expenses, changes in the fair value of contingent purchase consideration payables, and impairment of receivables from equity investees, increased by 6.8% to
ADJUSTED EBITDA: Adjusted EBITDA in the fourth quarter of 2019 increased by 3.3% to
NET PROFIT/LOSS: Net loss attributable to ordinary shareholders in the fourth quarter of 2019 was
PROFIT/LOSS PER SHARE: Basic and diluted loss per share were
As of
Net cash generated from operating activities in the fourth quarter of 2019 was
Full Year 2019 Financial Results
REVENUES: Net revenues in the full year of 2019 increased by 11.4% to
GROSS PROFIT: Gross profit in the full year of 2019 was
ADJUSTED CASH GROSS PROFIT, which excludes depreciation, amortization, and share-based compensation expenses, increased by 8.0% to
OPERATING EXPENSES: Total operating expenses in the full year of 2019 increased by 7.0% to
Sales and marketing expenses in the full year of 2019 were
Research and development expenses in the full year of 2019 were
General and administrative expenses in the full year of 2019 were
ADJUSTED OPERATING EXPENSES, which exclude share-based compensation expenses, changes in the fair value of contingent purchase consideration payables, and impairment of receivables from equity investees, decreased by 0.2% to
ADJUSTED EBITDA: Adjusted EBITDA in the full year of 2019 increased by 14.5% to
NET PROFIT/LOSS ATTRIBUTABLE TO ORDINARY SHAREHOLDERS: Net loss attributable to ordinary shareholders for 2019 was
PROFIT/LOSS PER SHARE: Basic and diluted loss per share were
Net cash generated from operating activities was
In
Financial Outlook
For the first quarter of 2020, the Company expects net revenues to be in the range of
For the full year of 2020, the Company expects net revenues to be in the range of
The forecast reflects the Company’s current and preliminary view on the market and its operational conditions, which do not factor in any of the potential future impacts caused by the COVID-19 epidemic and are subject to change.
Conference Call
The Company will hold a conference call at
Participants may access the call by dialing the following numbers:
United States Toll Free: | +1-866-519-4004 |
International: | +65-6713-5090 |
China Domestic: | 400-620-8038 |
+852-3018-6771 | |
Conference ID: | 2267403 |
The replay will be accessible through
United States Toll Free: | +1-855-452-5696 |
International: | +61-2-8199-0299 |
Conference ID: | 2267403 |
A live and archived webcast of the conference call will be available through the Company's investor relation website at http://ir.21vianet.com.
Non-GAAP Disclosure
In evaluating its business, 21Vianet considers and uses the following non-GAAP measures defined as non-GAAP financial measures by the
The non-GAAP financial measures are provided as additional information to help investors compare business trends among different reporting periods on a consistent basis and to enhance investors' overall understanding of the Company's current financial performance and prospects for the future. These non-GAAP financial measures should be considered in addition to results prepared in accordance with
Exchange Rate
This announcement contains translations of certain RMB amounts into
Statement Regarding Unaudited Condensed Financial Information
The unaudited financial information set forth above is preliminary and subject to potential adjustments. Adjustments to the consolidated financial statements may be identified when audit work has been performed for the Company's year-end audit, which could result in significant differences from this preliminary unaudited condensed financial information.
About 21Vianet
Safe Harbor Statement
This announcement contains forward-looking statements. These forward-looking statements are made under the "safe harbor" provisions of the
Investor Relations Contacts:
+86 10 8456 2121
IR@21Vianet.com
+86 10 8456 2121
IR@21Vianet.com
+1 (646) 405-4922
IR@21Vianet.com
__________________________
1Hosting MRR: Refers to Monthly Recurring Revenues for the hosting business.
CONSOLIDATED BALANCE SHEETS | ||||||
(Amount in thousands of Renminbi (“RMB”) and US dollars (“US$”)) | ||||||
As of | As of | |||||
RMB | RMB | US$ | ||||
(Audited) | (Unaudited) | (Unaudited) | ||||
Assets | ||||||
Current assets: | ||||||
Cash and cash equivalents | 2,358,556 | 1,808,483 | 259,772 | |||
Restricted cash | 265,214 | 478,873 | 68,786 | |||
Accounts and notes receivable, net | 524,305 | 657,158 | 94,395 | |||
Short-term investments | 245,014 | 363,856 | 52,265 | |||
Prepaid expenses and other current assets | 1,159,574 | 1,618,149 | 232,433 | |||
Amounts due from related parties | 125,446 | 301,665 | 43,331 | |||
Total current assets | 4,678,109 | 5,228,184 | 750,982 | |||
Non-current assets: | ||||||
Property and equipment, net | 4,031,242 | 5,443,565 | 781,919 | |||
Intangible assets, net | 355,313 | 410,595 | 58,978 | |||
Land use rights, net | 147,493 | 233,154 | 33,490 | |||
Operating lease right-of-use assets, net | - | 1,221,616 | 175,474 | |||
989,530 | 989,530 | 142,137 | ||||
Long-term investments | 544,323 | 169,653 | 24,369 | |||
Amounts due from related parties | 34,424 | 20,654 | 2,967 | |||
Restricted cash | 37,251 | 69,821 | 10,029 | |||
Deferred tax assets | 159,441 | 209,366 | 30,074 | |||
Other non-current assets | 173,591 | 277,568 | 39,870 | |||
Total non-current assets | 6,472,608 | 9,045,522 | 1,299,307 | |||
Total assets | 11,150,717 | 14,273,706 | 2,050,289 | |||
Liabilities and Shareholders' Equity | ||||||
Current liabilities: | ||||||
Short-term bank borrowings | 50,000 | 234,500 | 33,684 | |||
Accounts and notes payable | 389,508 | 296,261 | 42,555 | |||
Accrued expenses and other payables | 659,320 | 975,935 | 140,183 | |||
Deferred revenue | 57,754 | 57,625 | 8,277 | |||
Advances from customers | 670,037 | 1,068,692 | 153,508 | |||
Income taxes payable | 13,111 | 48,032 | 6,899 | |||
Amounts due to related parties | 52,328 | 163,247 | 23,449 | |||
Current portion of long-term bank borrowings | 75,284 | 32,500 | 4,668 | |||
Current portion of capital lease obligations | 219,695 | 227,115 | 32,623 | |||
Current portion of deferred government grant | 4,173 | 2,595 | 373 | |||
Bonds payable-current | - | 911,147 | 130,878 | |||
Operating lease liabilities - current | - | 451,372 | 64,835 | |||
Total current liabilities | 2,191,210 | 4,469,021 | 641,932 | |||
Non-current liabilities: | ||||||
Long-term borrowings | 112,000 | 79,500 | 11,419 | |||
Amounts due to related parties | 504,478 | 526,952 | 75,692 | |||
Unrecognized tax benefits | 6,677 | 2,443 | 351 | |||
Deferred tax liabilities | 157,720 | 202,572 | 29,098 | |||
Non-current portion of capital lease obligations | 765,993 | 896,927 | 128,836 | |||
Non-current portion of deferred government grant | 11,619 | 5,906 | 848 | |||
Bonds payable | 2,037,836 | 2,060,708 | 296,002 | |||
Operating lease liabilities - non current | - | 798,049 | 114,633 | |||
Total non-current liabilities | 3,596,323 | 4,573,057 | 656,879 | |||
Shareholders' equity | ||||||
(337,683 | ) | (349,523 | ) | (50,206 | ) | |
Ordinary shares | 46 | 46 | 7 | |||
Additional paid-in capital | 9,141,494 | 9,202,567 | 1,321,866 | |||
Accumulated other comprehensive gain | 85,979 | 77,904 | 11,190 | |||
Statutory reserves | 42,403 | 60,469 | 8,687 | |||
Accumulated deficit | (3,838,032 | ) | (4,038,390 | ) | (580,078 | ) |
Total |
5,094,207 | 4,953,073 | 711,466 | |||
Noncontrolling interest | 268,977 | 278,555 | 40,012 | |||
Total shareholders' equity | 5,363,184 | 5,231,628 | 751,478 | |||
Total liabilities and shareholders' equity | 11,150,717 | 14,273,706 | 2,050,289 | |||
CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||
(Amount in thousands of Renminbi (“RMB”) and US dollars (“US$”) except for number of shares and per share data) | ||||||||||||||
Three months ended | Twelve months ended | |||||||||||||
RMB | RMB | RMB | US$ | RMB | RMB | US$ | ||||||||
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Audited) | (Unaudited) | (Unaudited) | ||||||||
Net revenues | 901,887 | 980,969 | 1,048,119 | 150,553 | 3,401,037 | 3,788,967 | 544,251 | |||||||
Cost of revenues | (655,546 | ) | (758,414 | ) | (800,248 | ) | (114,948 | ) | (2,456,166 | ) | (2,849,518 | ) | (409,308 | ) |
Gross profit | 246,341 | 222,555 | 247,871 | 35,605 | 944,871 | 939,449 | 134,943 | |||||||
Operating expenses | ||||||||||||||
Other operating income | 5,027 | - | 6,862 | 986 | 5,027 | 6,862 | 986 | |||||||
Sales and marketing | (49,210 | ) | (52,399 | ) | (63,188 | ) | (9,076 | ) | (172,176 | ) | (206,309 | ) | (29,634 | ) |
Research and development | (23,583 | ) | (22,518 | ) | (24,920 | ) | (3,580 | ) | (92,109 | ) | (88,792 | ) | (12,754 | ) |
General and administrative | (130,963 | ) | (82,156 | ) | (109,984 | ) | (15,798 | ) | (462,637 | ) | (415,277 | ) | (59,651 | ) |
(Allowance) reversal for doubtful debt | (1,241 | ) | (6 | ) | (1,072 | ) | (154 | ) | 598 | (1,557 | ) | (224 | ) | |
Impairment of receivables from equity investees | - | - | (52,142 | ) | (7,490 | ) | - | (52,142 | ) | (7,490 | ) | |||
Changes in the fair value of contingent purchase consideration payables | 18,528 | - | - | - | 13,905 | - | - | |||||||
Total operating expenses | (181,442 | ) | (157,079 | ) | (244,444 | ) | (35,112 | ) | (707,392 | ) | (757,215 | ) | (108,767 | ) |
Operating profit | 64,899 | 65,476 | 3,427 | 493 | 237,479 | 182,234 | 26,176 | |||||||
Interest income | 14,214 | 15,379 | 14,988 | 2,153 | 45,186 | 54,607 | 7,844 | |||||||
Interest expense | (72,430 | ) | (96,936 | ) | (88,375 | ) | (12,694 | ) | (236,066 | ) | (345,955 | ) | (49,693 | ) |
Gain on deconsolidation of subsidiaries | - | - | - | - | 4,843 | - | - | |||||||
Other income | 7,050 | 2,187 | 22,160 | 3,183 | 58,033 | 36,380 | 5,226 | |||||||
Other expense | (1,875 | ) | (127 | ) | (1,270 | ) | (182 | ) | (4,103 | ) | (5,632 | ) | (809 | ) |
Foreign exchange gain (loss) | 2,488 | (40,192 | ) | 22,512 | 3,234 | (81,055 | ) | (27,995 | ) | (4,021 | ) | |||
Loss on debt extinguishment | - | (969 | ) | (122 | ) | (18 | ) | - | (18,895 | ) | (2,714 | ) | ||
Gain (loss) before income taxes and loss from equity method investments | 14,346 | (55,182 | ) | (26,680 | ) | (3,831 | ) | 24,317 | (125,256 | ) | (17,991 | ) | ||
Income tax benefits (expenses) | 46,350 | (10,039 | ) | 24,686 | 3,546 | (24,411 | ) | (5,437 | ) | (781 | ) | |||
Loss from equity method investments | (158,738 | ) | (1,078 | ) | (20,260 | ) | (2,910 | ) | (186,642 | ) | (50,553 | ) | (7,261 | ) |
Net loss | (98,042 | ) | (66,299 | ) | (22,254 | ) | (3,195 | ) | (186,736 | ) | (181,246 | ) | (26,033 | ) |
Net (profit) loss attributable to noncontrolling interest | (16,020 | ) | (3,157 | ) | 5,838 | 839 | (18,329 | ) | (1,046 | ) | (150 | ) | ||
Net loss attributable to ordinary shareholders | (114,062 | ) | (69,456 | ) | (16,416 | ) | (2,356 | ) | (205,065 | ) | (182,292 | ) | (26,183 | ) |
Loss per share | ||||||||||||||
Basic | (0.17 | ) | (0.10 | ) | (0.02 | ) | (0.00 | ) | (0.30 | ) | (0.27 | ) | (0.04 | ) |
Diluted | (0.17 | ) | (0.10 | ) | (0.02 | ) | (0.00 | ) | (0.30 | ) | (0.27 | ) | (0.04 | ) |
Shares used in loss per share computation | ||||||||||||||
Basic* | 676,361,072 | 679,135,837 | 670,523,195 | 670,523,195 | 674,732,130 | 668,833,756 | 668,833,756 | |||||||
Diluted* | 676,361,072 | 679,135,837 | 670,523,195 | 670,523,195 | 674,732,130 | 668,833,756 | 668,833,756 | |||||||
Loss per ADS (6 ordinary shares equal to 1 ADS) | ||||||||||||||
Basic | (1.02 | ) | (0.60 | ) | (0.12 | ) | (0.02 | ) | (1.80 | ) | (1.62 | ) | (0.24 | ) |
Diluted | (1.02 | ) | (0.60 | ) | (0.12 | ) | (0.02 | ) | (1.80 | ) | (1.62 | ) | (0.24 | ) |
* Shares used in (loss) profit per share/ADS computation were computed under weighted average method. | ||||||||||||||
RECONCILIATIONS OF GAAP AND NON-GAAP RESULTS | ||||||||||||||
(Amount in thousands of Renminbi (“RMB”) and US dollars (“US$”)) | ||||||||||||||
Three months ended | Twelve months ended | |||||||||||||
RMB | RMB | RMB | US$ | RMB | RMB | US$ | ||||||||
Gross profit | 246,341 | 222,555 | 247,871 | 35,605 | 944,871 | 939,449 | 134,943 | |||||||
Plus: depreciation and amortization | 161,201 | 173,712 | 177,529 | 25,500 | 565,101 | 691,764 | 99,366 | |||||||
Plus: share-based compensation expenses | 1,672 | 464 | 487 | 70 | 2,668 | 1,884 | 271 | |||||||
Adjusted cash gross profit | 409,214 | 396,731 | 425,887 | 61,175 | 1,512,640 | 1,633,097 | 234,580 | |||||||
Adjusted cash gross margin | 45.4% | 40.4% | 40.6% | 40.6% | 44.5% | 43.1% | 43.1% | |||||||
Operating expenses | (181,442 | ) | (157,079 | ) | (244,444 | ) | (35,112 | ) | (707,392 | ) | (757,215 | ) | (108,767 | ) |
Plus: share-based compensation expenses | 27,528 | 10,833 | 8,102 | 1,164 | 56,870 | 42,032 | 6,038 | |||||||
Plus: changes in the fair value of contingent purchase consideration payables | (18,528) | - | - | - | (13,905) | - | - | |||||||
Plus: impairment of receivables from equity investees | - | - | 52,142 | 7,490 | - | 52,142 | 7,490 | |||||||
Adjusted operating expenses | (172,442 | ) | (146,246 | ) | (184,200 | ) | (26,458 | ) | (664,427 | ) | (663,041 | ) | (95,239 | ) |
Operating profit | 64,899 | 65,476 | 3,427 | 493 | 237,479 | 182,234 | 26,176 | |||||||
Plus: depreciation and amortization | 179,759 | 195,729 | 199,642 | 28,677 | 634,606 | 772,205 | 110,920 | |||||||
Plus: share-based compensation expenses | 29,200 | 11,297 | 8,589 | 1,234 | 59,538 | 43,916 | 6,309 | |||||||
Plus: changes in the fair value of contingent purchase consideration payables | (18,528 | ) | - | - | - | (13,905 | ) | - | - | |||||
Plus: impairment of receivables from equity investees | - | - | 52,142 | 7,490 | - | 52,142 | 7,490 | |||||||
Adjusted EBITDA | 255,330 | 272,502 | 263,800 | 37,894 | 917,718 | 1,050,497 | 150,895 | |||||||
Adjusted EBITDA margin | 28.3% | 27.8% | 25.2% | 25.2% | 27.0% | 27.7% | 27.7% | |||||||
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS | |||||||||
(Amount in thousands of Renminbi (“RMB”) and US dollars (“US$”)) | |||||||||
Three months ended | |||||||||
RMB | RMB | RMB | US$ | ||||||
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||||
Net loss | (98,042 | ) | (66,299 | ) | (22,254 | ) | (3,195 | ) | |
Adjustments to reconcile net loss to net cash generated from operating activities: | |||||||||
Depreciation and amortization | 179,759 | 195,729 | 199,642 | 28,677 | |||||
Stock-based compensation expenses | 29,200 | 11,297 | 8,589 | 1,234 | |||||
Others | 95,122 | 33,913 | 11,992 | 1,723 | |||||
Changes in operating assets and liabilities | |||||||||
Accounts and notes receivable | 44,566 | (133,929 | ) | 126,542 | 18,177 | ||||
Prepaid expenses and other current assets | (117,604 | ) | (84,332 | ) | 2,499 | 359 | |||
Accounts and notes payable | (31,734 | ) | (60,121 | ) | (36,190 | ) | (5,198 | ) | |
Accrued expenses and other payables | 96,432 | 105,076 | (23,517 | ) | (3,378 | ) | |||
Deferred revenue | 5,135 | 16,138 | (3,391 | ) | (487 | ) | |||
Advances from customers | 79,968 | 103,772 | 72,628 | 10,432 | |||||
Others | (45,802 | ) | (18,259 | ) | 108,285 | 15,554 | |||
Net cash generated from operating activities | 237,000 | 102,985 | 444,825 | 63,898 | |||||
CASH FLOWS FROM INVESTING ACTIVITIES | |||||||||
Purchases of property and equipment | (129,910 | ) | (448,614 | ) | (458,230 | ) | (65,821 | ) | |
Purchases of intangible assets | (8,199 | ) | (8,278 | ) | (6,919 | ) | (994 | ) | |
Payments for investments | (101,796 | ) | (320,660 | ) | (136,840 | ) | (19,656 | ) | |
Proceeds from other investing activities | 97,917 | 162,811 | 51,283 | 7,366 | |||||
Net cash used in investing activities | (141,988 | ) | (614,741 | ) | (550,706 | ) | (79,105 | ) | |
CASH FLOWS FROM FINANCING ACTIVITIES | |||||||||
Proceeds from short-term bank borrowings | - | 200,000 | 4,500 | 646 | |||||
Repayment of long-term bank borrowings | (42,690 | ) | (44,331 | ) | (13,000 | ) | (1,867 | ) | |
Repayment of short-term bank borrowings | (19,999 | ) | - | - | - | ||||
Payments for capital lease | (104,420 | ) | (83,274 | ) | (91,487 | ) | (13,141 | ) | |
Repurchase of 2020 Notes | - | (126,553 | ) | - | - | ||||
Payment of Issuance cost of 2021 Notes | - | (183 | ) | - | - | ||||
(Payments for) proceeds from other financing activities | (17,324 | ) | 88 | 21,892 | 3,142 | ||||
Net cash used in financing activities | (184,433 | ) | (54,253 | ) | (78,095 | ) | (11,220 | ) | |
Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash | 14,507 | 68,718 | (46,956 | ) | (6,745 | ) | |||
Net decrease in cash, cash equivalents and restricted cash | (74,914 | ) | (497,291 | ) | (230,932 | ) | (33,172 | ) | |
Cash, cash equivalents and restricted cash at beginning of period | 2,735,935 | 3,085,400 | 2,588,109 | 371,759 | |||||
Cash, cash equivalents and restricted cash at end of period | 2,661,021 | 2,588,109 | 2,357,177 | 338,587 | |||||
Source: 21Vianet Group, Inc.