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21Vianet Group, Inc. Reports Unaudited Second Quarter 2019 Financial Results
Aug 19,2019

BEIJING, Aug. 19, 2019 (GLOBE NEWSWIRE) -- 21Vianet Group, Inc. (Nasdaq: VNET) ("21Vianet" or the "Company"), a leading carrier- and cloud-neutral Internet data center services provider in China, today announced its unaudited financial results for the second quarter ended June 30, 2019. The Company will hold a conference call at 8:00 P.M. on Monday, August 19, 2019, U.S. Eastern Time to discuss the financial results. Dial-in details are provided at the end of this release.

Second Quarter 2019 Financial Highlights

  • Net revenues increased by 7.2% year over year to RMB888.0 million (US$129.4 million).
     
  • Gross profit was RMB228.2 million, remaining flat year over year. Gross margin was 25.7%, compared to 27.7% in the second quarter of 2018. Adjusted cash gross profit (non-GAAP) increased by 10.9% year over year to RMB403.8 million (US$58.8 million) from RMB364.0 million. Adjusted cash gross margin expanded to 45.5% from 43.9% in the same period of 2018.
     
  • Adjusted EBITDA (non-GAAP) increased by 17.9% year over year to RMB260.7 million (US$38.0 million). Adjusted EBITDA margin expanded to 29.4% from 26.7% in the same period of 2018.
     
  • Net cash generated from operating activities was RMB127.1 million (US$18.5 million) compared to RMB111.4 million in the same period of 2018.

Second Quarter 2019 Operational Highlights

  • Hosting MRR1 per cabinet was RMB8,663 in the second quarter of 2019 compared to RMB8,271 in the second quarter of 2018 and RMB8,788 in the first quarter of 2019.
     
  • Total cabinets under management was 31,111 as of June 30, 2019, compared to 29,149 as of June 30, 2018, and 30,578 as of March 31, 2019. As of June 30, 2019, the Company had 26,196 cabinets in its self-built data centers and 4,915 cabinets in its partnered data centers.
     
  • Utilization rate was 66.0% in the second quarter of 2019, compared to 66.2% in the first quarter of 2019.

Mr. Alvin Wang, Chief Executive Officer and President of the Company, stated, “During the second quarter, we capitalized on the growing demand for flexible IDC solutions, bolstered our resource planning initiatives, and expanded our cabinet capacity. Through constant client communication and market analysis, we upsold additional cabinet capacity and value-added services to our existing client base. Additionally, we signed a number of sizable, long-term contracts with prominent clients in the internet and finance industry, demonstrating the effectiveness of our value proposition and enduring market leadership in such high-growth industries. We believe our proven ability to partner with high-level clientele will continue to serve as a vital growth driver throughout the remainder of 2019 and beyond. On the wholesale side, we are glad to have entered into an MoU with a major public cloud provider. This project is an important milestone and testament to our ability to win wholesale customers. We are optimistic that more customers will recognize our strength and expertise in future quarters. Finally, the adjustment to our partnership with Warburg Pincus is making good progress. Both parties are pleased with the adjustment and believe it gives each other greater flexibility to seize market opportunities.”

Ms. Sharon Liu, Chief Financial Officer of the Company, commented, “Due to the increase in client orders for the second quarter of 2019, revenues increased by 7.2% year over year and adjusted EBITDA grew by 17.9% year over year. In addition, adjusted EBITDA margin increased by 2.7 percentage points to 29.4%, compared to 26.7% in the second quarter of 2018. Importantly, our active client engagement throughout the quarter allowed us to enhance our cash position while maintaining a balanced financial leverage.”

Second Quarter 2019 Financial Results

REVENUES: Net revenues increased by 7.2% to RMB888.0 million (US$129.4 million) in the second quarter of 2019 from RMB828.3 million in the same period of 2018 and increased by 1.9% from RMB871.9 million in the first quarter of 2019. The year-over-year increase was primarily attributable to the growing demand for data centers in the domestic market.

GROSS PROFIT: Gross profit was RMB228.2 million (US$33.2 million) in the second quarter of 2019, compared to RMB229.4 million in the same period of 2018 and decreased by 5.2% from RMB240.8 million in the first quarter of 2019. Gross margin was 25.7% in the second quarter of 2019 compared to 27.7% in the same period of 2018 and 27.6% in the first quarter of 2019. The year-over-year decrease was mainly due to increased depreciation cost and the sequential decrease was mainly due to higher utility cost in summer months.

ADJUSTED CASH GROSS PROFIT, which excludes depreciation, amortization, and share-based compensation expenses, increased by 10.9% to RMB403.8 million (US$58.8 million) in the second quarter of 2019 from RMB364.0 million in the same period of 2018 and decreased by 0.7% from RMB406.7 million in the first quarter of 2019. Adjusted cash gross margin expanded to 45.5% in the second quarter of 2019 from 43.9% in the same period of 2018 and decreased from 46.6% in the first quarter of 2019. The year-over-year improvement in adjusted cash gross margin was mainly attributable to decreased number of partnered cabinets.
                                                                                                                                                                                            
OPERATING EXPENSES: Total operating expenses decreased by 5.5% to RMB168.2 million (US$24.5 million) in the second quarter of 2019 from RMB177.9 million in the same period of 2018 and decreased by 10.3% from RMB187.5 million in the first quarter of 2019. As a percentage of net revenues, total operating expenses reduced to 18.9% in the second quarter of 2019 from 21.5% in the same period of 2018 and 21.5% in the first quarter of 2019. The reduction of operating expenses as a percentage of net revenues was primarily due to the Company’s continuous efforts in maximizing its operating efficiency.

Sales and marketing expenses were RMB46.6 million (US$6.8 million) in the second quarter of 2019, an increase of 11.5% from RMB41.8 million in the same period of 2018 and an increase of 5.7% from RMB44.1 million in the first quarter of 2019. The increase of sales and marketing expenses was mainly attributable to increased marketing activities and higher sales commissions.

Research and development expenses were RMB18.8 million (US$2.7 million) in the second quarter of 2019 compared to RMB22.2 million in the same period of 2018 and RMB22.6 million in the first quarter of 2019. 

General and administrative expenses were RMB102.3 million (US$14.9 million) in the second quarter of 2019 compared to RMB109.1 million in the same period of 2018 and RMB120.8 million in the first quarter of 2019. The decrease was mainly attributable to the Company’s continuous efforts in maximizing its operating efficiency.

ADJUSTED OPERATING EXPENSES, which exclude share-based compensation expenses and changes in the fair value of contingent purchase consideration payables, decreased by 0.4% to RMB161.3 million (US$23.5 million) in the second quarter of 2019 from RMB161.9 million in the same period of 2018 and decreased by 5.9% from RMB171.3 million in the first quarter of 2019. As a percentage of net revenues, adjusted operating expenses decreased to 18.2% in the second quarter of 2019 from 19.5% in the same period of 2018 and 19.6% in the first quarter of 2019.

ADJUSTED EBITDA: Adjusted EBITDA in the second quarter of 2019 increased by 17.9% to RMB260.7 million (US$38.0 million) from RMB221.1 million in the same period of 2018 and increased by 2.9% from RMB253.5 million in the first quarter of 2019. Adjusted EBITDA in the second quarter of 2019 excluded share-based compensation expenses of RMB7.4 million (US$1.1 million). Adjusted EBITDA margin expanded to 29.4% in the second quarter of 2019 from 26.7% in the same period of 2018 and 29.1% in the first quarter of 2019.

NET PROFIT/LOSS: Net loss attributable to ordinary shareholders in the second quarter of 2019 was RMB102.1 million (US$14.9 million) compared to RMB94.2 million in the same period of 2018 and a net profit of RMB5.6 million in the first quarter of 2019. Net loss attributable to ordinary shareholders in the second quarter of 2019 included a foreign exchange loss of RMB39.9 million (US$5.8 million) compared to RMB73.4 million in the same period of 2018 and a gain of RMB29.5 million in the first quarter of 2019, and an interest expense of RMB91.2 million (US$13.3 million) compared to RMB51.3 million in the same period of 2018 and RMB69.4 million in the first quarter of 2019.

PROFIT/LOSS PER SHARE: Basic and diluted loss per share were RMB0.15 (US$ 2 cent) in the second quarter of 2019, which represents the equivalent of RMB0.90 (US$12 cent) per American Depositary Share ("ADS"). Each ADS represents six ordinary shares. Diluted loss per share is calculated using net loss attributable to ordinary shareholders divided by the weighted average number of diluted shares outstanding.

As of June 30, 2019, the Company's cash andcash equivalents, restricted cash, and short-term investments were RMB3.25 billion (US$473.1 million).

Net cash generated from operating activities was RMB127.1 million (US$18.5 million) in the second quarter of 2019 compared to RMB111.4 million in the same period of 2018 and RMB32.4 million in the first quarter of 2019.

Recent Development

Signing a Non-binding MoU

In August 2019, the Company signed a non-binding memorandum of understanding (the “MoU”) with a major public cloud service provider in China to provide a number of cabinets, all of which are expected to be delivered by April 2020.

JV Restructuring

The Company has recently reached an agreement with Warburg Pincus to restructure the existing partnership. Pursuant to the agreed arrangement, one of the joint ventures will distribute its assets and projects to the Company and to Princeton Digital Group (PDG), a Warburg Pincus-backed company, on a pro rata basis. 

After distribution, the Company will gain 100% ownership of a project under development in the Shanghai Waigaoqiao Free Trade Zone as well as cash. The project will further increase the Company’s cabinet capacity in phases by over 6,000 cabinets. The first phase with over 2,000 cabinets is expected to be delivered in early 2020.

Financial Outlook

For the third quarter of 2019, the Company expects net revenues to be in the range of RMB950 million to RMB980 million. Adjusted EBITDA is expected to be in the range of RMB250 million to RMB270 million.

For the full year of 2019, the Company expects net revenues to be in the range of RMB3,760 million to RMB3,860 million. Adjusted EBITDA is expected to be in the range of RMB1,000 million to RMB1,100 million. The midpoints of the Company’s updated estimates imply an increase of 12% year over year in total revenues and an increase of 14% year over year in adjusted EBITDA.

The forecast reflects the Company’s current and preliminary view on the market and its operational conditions, which is subject to change.

Conference Call

The Company will hold a conference call at 8:00 P.M. on Monday, August 19, 2019, U.S. Eastern Time, or 8:00 A.M. on Tuesday, August 20, 2019, Beijing Time, to discuss the financial results.

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
Hong Kong: +852-3018-6771
Conference ID:   4625439

The replay will be accessible through August 27, 2019, by dialing the following numbers:

United States Toll Free: +1-855-452-5696
International:  +61-2-8199-0299
Conference ID:  4625439

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 SEC as a supplemental measure to review and assess its operating performance: adjusted cash gross profit, adjusted cash gross margin, adjusted operating expenses, adjusted EBITDA, adjusted EBITDA margin, The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with U.S. GAAP. For more information on these non-GAAP financial measures, please see the table captioned "Reconciliations of GAAP and non-GAAP results" set forth at the end of this press release.

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 U.S. GAAP, but should not be considered a substitute for, or superior to, U.S. GAAP results. In addition, the Company's calculation of the non-GAAP financial measures may be different from the calculation used by other companies, and therefore comparability may be limited.

Exchange Rate

This announcement contains translations of certain RMB amounts into U.S. dollars (“USD”) at specified rates solely for the convenience of the reader. Unless otherwise stated, all translations from RMB to USD were made at the rate of RMB6.8650 to US$1.00, the noon buying rate in effect on June 28, 2019, in the H.10 statistical release of the Federal Reserve Board. The Company makes no representation that the RMB or USD amounts referred could be converted into USD or RMB, as the case may be, at any particular rate or at all. For analytical presentation, all percentages are calculated using the numbers presented in the financial statements contained in this earnings release.

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

21Vianet Group, Inc. is a leading carrier- and cloud-neutral Internet data center services provider in China. 21Vianet provides hosting and related services, including IDC services, cloud services, and business VPN services to improve the reliability, security and speed of its customers' Internet infrastructure. Customers may locate their servers and equipment in 21Vianet's data centers and connect to China's Internet backbone. 21Vianet operates in more than 30 cities throughout China, servicing a diversified and loyal base of nearly 5,000 hosting and related enterprise customers that span numerous industries ranging from Internet companies to government entities and blue-chip enterprises to small- to mid-sized enterprises.

Safe Harbor Statement

This announcement contains forward-looking statements. These forward-looking statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Among other things, quotations from management in this announcement as well as 21Vianet's strategic and operational plans contain forward-looking statements. 21Vianet may also make written or oral forward-looking statements in its reports filed with, or furnished to, the U.S. Securities and Exchange Commission, in its annual reports to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about 21Vianet's beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: 21Vianet's goals and strategies; 21Vianet's expansion plans; the expected growth of the data center services market; expectations regarding demand for, and market acceptance of, 21Vianet's services; 21Vianet's expectations regarding keeping and strengthening its relationships with customers; 21Vianet's plans to invest in research and development to enhance its solution and service offerings; and general economic and business conditions in the regions where 21Vianet provides solutions and services. Further information regarding these and other risks is included in 21Vianet's reports filed with, or furnished to, the Securities and Exchange Commission. All information provided in this press release and in the attachments is as of the date of this press release, and 21Vianet undertakes no duty to update such information, except as required under applicable law.

Investor Relations Contacts:

21Vianet Group, Inc.
Rene Jiang
+86 10 8456 2121
IR@21Vianet.com

Julia Jiang
+86 10 8456 2121
IR@21Vianet.com

ICR, Inc.
Jack Wang
+1 (646) 405-4922
IR@21Vianet.com

___________________________

1Hosting MRR: Refers to Monthly Recurring Revenues for the hosting business. 

 

 21VIANET GROUP, INC.   
 CONSOLIDATED BALANCE SHEETS   
 (Amount in thousands of Renminbi (“RMB”) and US dollars (“US$”))   
   As of     As of   
December 31, 2018   June 30, 2019  
   RMB     RMB     US$   
   (Audited)     (Unaudited)     (Unaudited)   
 Assets               
 Current assets:             
 Cash and cash equivalents    2,358,556       2,864,359       417,241    
 Restricted cash    265,214       152,025       22,145    
 Accounts and notes receivable, net    524,305       672,573       97,971    
 Short-term investments    245,014       162,770       23,710    
 Prepaid expenses and other current assets    1,159,574       1,437,382       209,379    
 Amounts due from related parties    125,446       128,579       18,730    
 Total current assets    4,678,109       5,417,688       789,176    
             
 Non-current assets:             
 Property and equipment, net    4,031,242       4,073,865       593,425    
 Intangible assets, net    355,313       429,813       62,609    
 Land use rights, net    147,493       145,704       21,224    
 Operating lease right-of-use assets, net    -        803,016       116,972    
 Goodwill    989,530       989,530       144,141    
 Long-term investments    544,323       506,297       73,750    
 Amounts due from related parties    34,424       99,250       14,457    
 Restricted cash    37,251       69,016       10,053    
 Deferred tax assets    159,441       168,325       24,519    
 Other non-current assets    173,591       227,994       33,211    
 Total non-current assets    6,472,608       7,512,810       1,094,361    
 Total assets    11,150,717       12,930,498       1,883,537    
             
 Liabilities and Shareholders' Equity             
 Current liabilities:             
 Short-term bank borrowings    50,000       30,000       4,370    
 Accounts and notes payable    389,508       392,572       57,185    
 Accrued expenses and other payables    659,320       586,899       85,487    
 Deferred revenue    57,754       44,878       6,537    
 Advances from customers    670,037       892,292       129,977    
 Income taxes payable    13,111       29,020       4,227    
 Amounts due to related parties    52,328       42,725       6,224    
 Current portion of long-term bank borrowings    75,284       73,331       10,682    
 Current portion of capital lease obligations    219,695       179,253       26,111    
 Current portion of deferred government grant    4,173       3,501       510    
 Operating lease liabilities - current    -        102,908       14,990    
 Total current liabilities    2,191,210       2,377,379       346,300    
             
 Non-current liabilities:             
 Long-term borrowings    112,000       96,000       13,984    
 Amounts due to related parties    504,478       533,869       77,767    
 Unrecognized tax benefits    6,677       3,952       576    
 Deferred tax liabilities    157,720       175,289       25,534    
 Non-current portion of capital lease obligations    765,993       691,110       100,672    
 Non-current portion of deferred government grant    11,619       8,751       1,275    
 Bonds payable    2,037,836       3,041,382       443,027    
 Operating lease liabilities - non current    -        697,233       101,563    
 Total non-current liabilities    3,596,323       5,247,586       764,398    
             
 Shareholders' equity             
 Treasury stock    (337,683 )     (337,683 )     (49,189 )  
 Ordinary shares    46       46       7    
 Additional paid-in capital    9,141,494       9,168,796       1,335,586    
 Accumulated other comprehensive gain    85,979       89,630       13,057    
 Statutory reserves    42,403       43,825       6,384    
 Accumulated deficit    (3,838,032 )     (3,935,874 )     (573,325 )  
 Total 21Vianet Group, Inc. shareholders’ equity    5,094,207       5,028,740       732,520    
 Noncontrolling interest    268,977       276,793       40,319    
 Total shareholders' equity    5,363,184       5,305,533       772,839    
 Total liabilities and shareholders' equity    11,150,717       12,930,498       1,883,537    
             

  

 21VIANET GROUP, INC.   
 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     Six months ended   
  June 30, 2018   March 31, 2019   June 30, 2019   June 30, 2018   June 30, 2019  
   RMB     RMB     RMB     US$     RMB     RMB     US$   
   (Unaudited)     (Unaudited)     (Unaudited)     (Unaudited)     (Unaudited)     (Unaudited)     (Unaudited)   
 Net revenues    828,317       871,859       888,020       129,355       1,629,082       1,759,879       256,355    
 Cost of revenues    (598,884 )     (631,084 )     (659,772 )     (96,107 )     (1,171,747 )     (1,290,856 )     (188,034 )  
 Gross profit    229,433       240,775       228,248       33,248       457,335       469,023       68,321    
                             
 Operating expenses                             
 Other operating income    -        -        302       44       -        302       44    
 Sales and marketing    (41,816 )     (44,096 )     (46,626 )     (6,792 )     (83,048 )     (90,722 )     (13,215 )  
 Research and development    (22,163 )     (22,564 )     (18,790 )     (2,737 )     (44,193 )     (41,354 )     (6,024 )  
 General and administrative    (109,091 )     (120,796 )     (102,341 )     (14,908 )     (221,431 )     (223,137 )     (32,504 )  
 Reversal (allowance) for doubtful debt    627       (22 )     (457 )     (67 )     2,482       (479 )     (70 )  
 Changes in the fair value of contingent purchase consideration payables    (5,494 )     -       -       -       (3,210 )     -       -    
 Total operating expenses    (177,937 )     (187,478 )     (168,214 )     (24,504 )     (349,400 )     (355,692 )     (51,813 )  
                             
 Operating profit    51,496       53,297       60,034       8,744       107,935       113,331       16,508    
 Interest income    8,961       11,851       12,389       1,805       17,488       24,240       3,531    
 Interest expense    (51,328 )     (69,442 )     (91,202 )     (13,285 )     (102,870 )     (160,644 )     (23,400 )  
 Gain on deconsolidation of subsidiaries    4,843       -       -       -       4,843       -       -    
 Other income    20,386       3,075       8,958       1,305       42,547       12,033       1,753    
 Other expense    (565 )     (58 )     (4,177 )     (608 )     (2,091 )     (4,235 )     (617 )  
 Foreign exchange (loss) gain    (73,360 )     29,538       (39,853 )     (5,805 )     (28,519 )     (10,315 )     (1,503 )  
 Loss on debt extinguishment    -       -       (17,804 )     (2,593 )     -       (17,804 )     (2,593 )  
 (Loss) gain before income taxes and loss from equity method investments    (39,567 )     28,261       (71,655 )     (10,437 )     39,333       (43,394 )     (6,321 )  
 Income tax expenses    (44,305 )     (10,741 )     (9,343 )     (1,361 )     (78,385 )     (20,084 )     (2,925 )  
 Loss from equity method investments    (11,659 )     (10,938 )     (18,277 )     (2,662 )     (21,748 )     (29,215 )     (4,256 )  
 Net (loss) gain    (95,531 )     6,582       (99,275 )     (14,460 )     (60,800 )     (92,693 )     (13,502 )  
 Net loss (profit) attributable to noncontrolling interest    1,321       (942 )     (2,785 )     (406 )     (570 )     (3,727 )     (543 )  
 Net (loss) gain attributable to ordinary shareholders    (94,210 )     5,640       (102,060 )     (14,866 )     (61,370 )     (96,420 )     (14,045 )  
                             
 (Loss) profit per share                             
 Basic    (0.14 )     0.01       (0.15 )     (0.02 )     (0.09 )     (0.14 )     (0.02 )  
 Diluted    (0.14 )     0.01       (0.15 )     (0.02 )     (0.09 )     (0.14 )     (0.02 )  
                             
 Shares used in (loss) profit per share computation                             
 Basic*    675,062,068       677,573,837       677,802,980       677,802,980       673,908,526       677,689,041       677,689,041    
 Diluted*    675,062,068       690,608,562       677,802,980       677,802,980       673,908,526       677,689,041       677,689,041    
                             
(Loss) profit per ADS (6 ordinary shares equal to 1 ADS)                            
Basic (0.84 )   0.06     (0.90 )     (0.12 )   (0.54 )   (0.84 )     (0.12 )  
Diluted (0.84 )   0.06     (0.90 )     (0.12 )   (0.54 )   (0.84 )     (0.12 )  
                             
 * Shares used in (loss) profit per share/ADS computation were computed under weighted average method.   

  

 21VIANET GROUP, INC.   
 RECONCILIATIONS OF GAAP AND NON-GAAP RESULTS   
 (Amount in thousands of Renminbi (“RMB”) and US dollars (“US$”))   
                             
   Three months ended     Six months ended   
  June 30, 2018   March 31, 2019   June 30, 2019   June 30, 2018   June 30, 2019  
   RMB     RMB     RMB     US$     RMB     RMB     US$   
 Gross profit    229,433       240,775       228,248       33,248       457,335       469,023       68,321    
 Plus: depreciation and amortization    134,282       165,421       175,102       25,506       253,844       340,523       49,603    
 Plus: share-based compensation expenses    293       474       459       67       307       933       136    
 Adjusted cash gross profit    364,008       406,670       403,809       58,821       711,486       810,479       118,060    
 Adjusted cash gross margin  43.9 %   46.6 %   45.5 %   45.5 %   43.7 %   46.1 %   46.1 %  
                             
 Operating expenses    (177,937 )     (187,478 )     (168,214 )     (24,503 )     (349,400 )     (355,692 )     (51,812 )  
 Plus: share-based compensation expenses    10,547       16,165       6,932       1,010       17,102       23,097       3,364    
 Plus: changes in the fair value of contingent purchase consideration payables    5,494       -       -       -       3,210       -       -    
 Adjusted operating expenses    (161,896 )     (171,313 )     (161,282 )     (23,493 )     (329,088 )     (332,595 )     (48,448 )  
                             
 Operating profit    51,496       53,297       60,034       8,745       107,935       113,331       16,509    
 Plus: depreciation and amortization    153,313       183,532       193,302       28,158       288,603       376,834       54,892    
 Plus: share-based compensation expenses    10,840       16,639       7,391       1,077       17,409       24,030       3,500    
 Plus: changes in the fair value of contingent purchase consideration payables    5,494       -        -        -        3,210       -        -     
 Adjusted EBITDA    221,143       253,468       260,727       37,980       417,157       514,195       74,901    
 Adjusted EBITDA margin  26.7 %   29.1 %   29.4 %   29.4 %   25.6 %   29.2 %   29.2 %  

 

 21VIANET GROUP, INC.   
 CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS   
 (Amount in thousands of Renminbi (“RMB”) and US dollars (“US$”))   
                 
   Three months ended   
  June 30, 2018   March 31, 2019   June 30, 2019  
   RMB     RMB     RMB     US$   
   (Unaudited)     (Unaudited)     (Unaudited)     (Unaudited)   
 CASH FLOWS FROM OPERATING ACTIVITIES                 
 Net (loss) profit    (95,531 )     6,582       (99,275 )     (14,460 )  
 Adjustments to reconcile net (loss) profit to net cash generated from operating activities:                 
  Depreciation and amortization    153,313       183,532       193,302       28,158    
  Stock-based compensation expenses    10,840       16,639       7,391       1,077    
  Others    93,201       (31,628 )     69,061       10,060    
 Changes in operating assets and liabilities                 
  Accounts and notes receivable    (29,540 )     (29,603 )     (119,144 )     (17,355 )  
  Prepaid expenses and other current assets    (14,088 )     (197,574 )     (50,381 )     (7,339 )  
  Accounts and notes payable    (4,819 )     (11,580 )     14,644       2,133    
  Accrued expenses and other payables    25,971       (9,582 )     9,996       1,456    
  Deferred revenue    6,217       (13,812 )     936       136    
  Advances from customers    (1,698 )     97,028       125,227       18,241    
  Others    (32,468 )     22,435       (24,647 )     (3,590 )  
 Net cash generated from operating activities    111,398       32,437       127,110       18,517    
                 
 CASH FLOWS FROM INVESTING ACTIVITIES                 
 Purchases of property and equipment    (91,256 )     (133,470 )     (208,520 )     (30,374 )  
 Purchases of intangible assets    (3,756 )     (4,328 )     (6,990 )     (1,018 )  
 Payments for investments    (39,098 )     (62,022 )     (127,148 )     (18,521 )  
 Proceeds from other investing activities    357,302       84,367       11,575       1,686    
 Net cash generated from (used in) investing activities    223,192       (115,453 )     (331,083 )     (48,227 )  
                 
 CASH FLOWS FROM FINANCING ACTIVITIES                 
 Proceeds from short-term bank borrowings    -       30,000       -       -    
 Repayment of long-term bank borrowings    (27,953 )     -       (27,779 )     (4,046 )  
 Repayment of short-term bank borrowings    -       (50,000 )     -       -    
 Payments for capital lease    (95,183 )     (92,537 )     (66,316 )     (9,660 )  
 Repurchase of 2020 Notes    -       -       (1,021,539 )     (148,804 )  
 Proceeds from issuance of 2021 Notes    -       -       2,012,084       293,093    
 Payment of Issuance cost of 2021 Notes    -       -       (35,427 )     (5,161 )  
 Payments for other financing activities    38,801       (55,474 )     (3,542 )     (516 )  
 Net cash (used in) generated from financing activities    (84,335 )     (168,011 )     857,481       124,906    
                 
 Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash    80,660       (34,488 )     56,386       8,214    
 Net increase (decrease) in cash, cash equivalents and restricted cash    330,915       (285,515 )     709,894       103,410    
 Cash, cash equivalents and restricted cash at beginning of period    2,108,237       2,661,021       2,375,506       346,031    
 Cash, cash equivalents and restricted cash at end of period    2,439,152       2,375,506       3,085,400       449,441    
                 

 

Source: 21Vianet Group, Inc.