FangDD Reports Second Quarter 2020 Unaudited Financial Results
Second Quarter 2020 Financial Highlights
- Revenue in the second quarter of 2020 decreased by 22.2% year over year to
RMB737.7 million (US$104.4 million ) fromRMB948.2 million in the same period of 2019. - Net loss in the second quarter of 2020 was
RMB14.0 million (US$2.0 million ). - Non-GAAP net income 1 in the second quarter of 2020 was
RMB11.9 million (US$1.7 million ).
Second Quarter 2020 Operating Highlights
- The number of active agents2 in the Company’s marketplace in the second quarter of 2020 was 265.9 thousand, representing an increase of 26.9% from 209.5 thousand in the same period of 2019.
- The number of closed-loop agents3 in the second quarter of 2020 was 18.2 thousand, representing a decrease of 13.7% from 21.1 thousand in the same period of 2019.
- Total closed-loop GMV4 facilitated on the Company’s platform in the second quarter of 2020 decreased by 13.5% to
RMB50.0 billion (US$7.1 billion ) fromRMB57.8 billion in the same period of 2019. New property and resale listings contributedRMB33.6 billion (US$4.8 billion ) andRMB16.4 billion (US$2.3 billion ), respectively, to the total closed-loop GMV in the second quarter of 2020.
Mr.
Mr.
Ms. Jiaorong Pan, Chief Financial Officer of FangDD, added, “Despite the persistence of COVID-19 in the second quarter, we faced the challenges head on and worked to refine our cost structures and operating efficiency in order to prepare for the coming growth cycle. As the outbreak continues to be gradually brought under control, our business has also been able to reaccelerate, and we saw total revenue in June increase by 35.9% year over year. While decreases in both the number of transactions and total closed-loop GMV facilitated on our platform constrained our revenue generation capabilities in the second quarter, we have seen that real estate agent activity is picking up, and we expect these metrics to improve as the pandemic abates. Going forward, we intend to maintain a prudent mindset throughout our capital allocation process and focus on those initiatives capable of supporting our long-term growth objectives, such as our SaaS solutions and other service offerings. Such efforts should serve to fortify our leadership in China’s real estate transaction industry as we enter the post-pandemic period.”
Second Quarter 2020 Financial Results
REVENUE
Revenue in the second quarter of 2020 decreased by 22.2% to
COST OF REVENUE
Cost of revenue in the second quarter of 2020 decreased by 15.1% to
GROSS PROFIT
Gross profit in the second quarter of 2020 decreased by 45.5% to
OPERATING EXPENSES
Operating expenses in the second quarter of 2020, including share-based compensation expenses of
- Sales and marketing expenses in the second quarter of 2020 decreased by 86.4% to
RMB2.9 million (US$0.4 million ) fromRMB21.3 million in the same period of 2019. The decrease in sales and marketing expenses was primarily due to the reduction in spending on brand promotion and marketing activities to attract property listings from real estate sellers to the Company’s marketplace. - Product development expenses in the second quarter of 2020 were
RMB70.5 million (US$10.0 million ) compared toRMB79.1 million in the same period of 2019. The decrease in product development expenses was mainly attributable to the Company’s shifting from expanding the team size to optimizing the operating efficiency of its product development team in response to the outbreak of COVID-19, which led to a decrease in personnel-related expenses in the period. The decrease was partially offset by share-based compensation expenses ofRMB16.3 million (US$2.3 million ) in the second quarter of 2020. - General and administrative expenses in the second quarter of 2020 were
RMB80.5 million (US$11.4 million ), compared toRMB55.3 million in the same period of 2019. The increase in general and administrative expenses in the period included share-based compensation expenses ofRMB9.6 million (US$1.4 million ). The remaining increase ofRMB15.6 million (US$2.2 million ) in general and administrative expenses was primarily attributable to (1) an increased headcount and various expenditures to improve the Company’s corporate governance and ensure compliance in relation to the Company’s status as aU.S. -listed company; and (2) an increase in the account of provisions for doubtful debtors.
NET INCOME (LOSS)
Net loss in the second quarter of 2020 was
Non-GAAP net income in the second quarter of 2020 was
NET INCOME (LOSS) PER ADS
Basic and diluted net loss per American Depositary Share (“ADS”) in the second quarter of 2020 were both
Liquidity
As of
Business Outlook
For the third quarter of 2020, the Company expects its revenue to be between
Conference Call Information
The Company’s management team will hold a Direct Event conference call on
Event Title: | |
Conference ID: | #2783556 |
Registration Link: | http://apac.directeventreg.com/registration/event/2783556 |
Due to the global outbreak of the novel coronavirus, operator assisted conference calls are not available at the moment. All participants must use the link provided above to complete the online registration process in advance of the conference call. Upon registering, each participant will receive a set of participant dial-in numbers, the Direct Event passcode, and a unique access PIN, which can be used to join the conference call.
A replay of the conference call will be accessible through
+1-646-254-3697 | |
+852-3051-2780 | |
Replay Code: | #2783556 |
A live and archived webcast of the conference call will also be available at the Company’s investor relations website at http://ir.fangdd.com/.
Exchange Rate
This press release contains translations of certain Renminbi amounts into
Non-GAAP Financial Measures
To supplement the financial measures prepared in accordance with generally accepted accounting principles in
About FangDD
Safe Harbor Statement
This announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the
Investor Relations Contact
FangDD
Ms.
Director,
Phone: +86-0755-2699-8968
E-mail: ir@fangdd.com
Phone: +1(646) 308-1649
E-mail: FangDD@icrinc.com
SELECTED UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS DATA (All amounts in thousands of Renminbi, except for share and per share data) |
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As of December 31, | As of |
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2019 | 2020 | ||
Assets | |||
Current assets | |||
Cash and cash equivalents | 1,103,747 | 833,688 | |
Restricted cash | 230,125 | 95,315 | |
Short-term investments | 11,500 | 21,202 | |
Accounts receivable, net | 2,189,980 | 2,082,899 | |
Prepayments and other current assets | 194,668 | 413,888 | |
Total current assets | 3,730,020 | 3,446,992 | |
Total assets | 4,372,125 | 4,040,332 | |
LIABILITIES | |||
Current liabilities | |||
Short-term bank borrowings | 490,000 | 361,944 | |
Accounts payable | 1,897,611 | 1,842,511 | |
Customers’ refundable fees | 44,916 | 37,333 | |
Accrued expenses and other payables | 338,626 | 284,844 | |
Taxes payable | 7 | - | |
Total current liabilities | 2,771,160 | 2,526,632 | |
Total liabilities | 2,783,070 | 2,539,581 | |
Total shareholders' equity | 1,589,055 | 1,500,751 | |
Total liabilities and equity | 4,372,125 | 4,040,332 | |
SELECTED UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) DATA (All amounts in thousands of Renminbi, except for share and per share data) |
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For the Three Months Ended |
For the Six Months Ended |
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2019 | 2020 | 2019 | 2020 | |||||||||
Revenue | 948,232 | 737,690 | 1,604,238 | 1,009,798 | ||||||||
Cost of revenue | (726,006 | ) | (616,737 | ) | (1,260,525 | ) | (839,452 | ) | ||||
Gross profit | 222,226 | 120,953 | 343,713 | 170,346 | ||||||||
Operating expenses: | ||||||||||||
Sales and marketing expenses | (21,347 | ) | (2,895 | ) | (27,465 | ) | (4,282 | ) | ||||
Product development expenses | (79,082 | ) | (70,495 | ) | (144,818 | ) | (165,474 | ) | ||||
General and administrative expenses | (55,250 | ) | (80,517 | ) | (99,774 | ) | (173,580 | ) | ||||
Total operating expenses | (155,679 | ) | (153,907 | ) | (272,057 | ) | (343,336 | ) | ||||
Income (loss) from operations | 66,547 | (32,954 | ) | 71,656 | (172,990 | ) | ||||||
Net income (loss) | 85,510 | (13,987 | ) | 100,307 | (150,432 | ) | ||||||
Accretion of Redeemable Convertible Preferred Shares | (47,845 | ) | - | (114,081 | ) | - | ||||||
Net income (loss) attributable to ordinary shareholders | 37,665 | (13,987 | ) | (13,774 | ) | (150,432 | ) | |||||
Net income (loss) | 85,510 | (13,987 | ) | 100,307 | (150,432 | ) | ||||||
Other comprehensive (loss) income | ||||||||||||
Foreign currency translation adjustment, net of nil income taxes | (63,515 | ) | (1,107 | ) | (3,096 | ) | 9,780 | |||||
Total comprehensive loss, net of income taxes | 21,995 | (15,094 | ) | 97,211 | (140,652 | ) | ||||||
Net income (loss) per share | ||||||||||||
- Basic | 0.04 | (0.01 | ) | (0.01 | ) | (0.08 | ) | |||||
- diluted | 0.04 | (0.01 | ) | (0.01 | ) | (0.08 | ) | |||||
Net income (loss) per ADS | ||||||||||||
- Basic | 1.00 | (0.18 | ) | (0.36 | ) | (1.89 | ) | |||||
- diluted | 1.00 | (0.18 | ) | (0.36 | ) | (1.89 | ) | |||||
Weighted average number of ordinary shares used in computing net loss per share, basic and diluted | ||||||||||||
- Basic | 945,712,030 | 1,996,169,104 | 945,712,030 | 1,990,437,318 | ||||||||
- diluted | 945,712,030 | 1,996,169,104 | 945,712,030 | 1,990,437,318 |
Reconciliation of GAAP and Non-GAAP Results (All amounts in thousands of Renminbi, except for share and per share data) |
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For the Three Months Ended |
For the Six Months Ended |
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2019 | 2020 | 2019 | 2020 | ||||||||
GAAP income/(loss) from operations | 66,547 | (32,954) | 71,656 | (172,990) | |||||||
Share-based compensation expenses | - | 25,916 | - | 52,347 | |||||||
Non-GAAP income/(loss) from operations | 66,547 | (7,038) | 71,656 | (120,643) | |||||||
GAAP net income/(loss) | 85,510 | (13,987) | 100,307 | (150,432) | |||||||
Share-based compensation expenses | - | 25,916 | - | 52,347 | |||||||
Non-GAAP net income/(loss) | 85,510 | 11,929 | 100,307 | (98,085) | |||||||
GAAP operating margin5 | 7.0% | (4.5%) | 4.5% | (17.1%) | |||||||
Share-based compensation expenses | - | 3.5% | - | 5.2% | |||||||
Non-GAAP operating margin | 7.0% | (1.0%) | 4.5% | (11.9%) | |||||||
GAAP net margin6 | 9.0% | (1.9%) | 6.3% | (14.9%) | |||||||
Share-based compensation expenses | - | 3.5% | - | 5.2% | |||||||
Non-GAAP net margin | 9.0% | 1.6% | 6.3% | (9.7%) |
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1 Non-GAAP net income is defined as net loss excluding share-based compensation expenses. For more information on these non-GAAP financial measures, please see the section captioned “Non-GAAP Financial Measures” and the tables captioned “Reconciliation of GAAP and Non-GAAP Results” set forth at the end of this release.
2 “Active agents” refer to real estate agents who have visited the Company’s marketplace and used one or more of its functions within a period of time.
3 Closed-loop agents refer to real estate agents who have completed closed-loop transactions in the Company’s marketplace under the Company’s monitoring and control.
4 “Closed-loop GMV” refers to the GMV of closed-loop transactions facilitated in our marketplace during the specified period.
5 Operating margin is defined as income (loss) from operations divided by revenue.
6 Net margin is defined as net income (loss) attributable to ordinary shareholders divided by revenue.
Source: Fangdd Network Group Ltd