HANGZHOU, China, Nov. 16,
2022 /PRNewswire/ -- BEST Inc. (NYSE: BEST)
("BEST" or the "Company"), a leading integrated smart supply chain
solutions and logistics services provider in China and Southeast
Asia ("SEA"), today announced its unaudited financial
results for the third quarter ended September 30, 2022.
Johnny Chou, Founder, Chairman
and CEO of BEST, commented, "Ongoing COVID-19 pandemic-related
restrictions continued to impact the macro environment in
China and SEA, weighing heavily on
the logistics industry. Amid the challenging landscape, we
delivered good progress in our core business lines. BEST Freight's
growth momentum picked up, showing volume increase both quarter
over quarter and year over year. BEST Supply Chain Management
("SCM") delivered strong top line and bottom line results compared
with the same quarter last year.
"In the third quarter of 2022, total Freight volume increased by
4.1% year over year. Its revenue increased by 9.7% and gross
loss narrowed by 58.3% compared with the second quarter of
2022. BEST SCM achieved year-over-year revenue growth of
15.2% and its gross margin reached 7.2%, up 3.5 percentage points
from the same quarter last year, narrowing SCM's net loss by
64.3%.
"Southeast Asia market remained
challenging in the third quarter. While continuing to improve
service quality and efficiency, we focused on expanding small and
medium enterprise customer coverage to reduce customer
concentration. We also continued to synergize with SCM and Freight
in developing cross-border and supply chain business in the region.
Despite the challenging environment, we remain bullish on
long-term growth opportunities in SEA markets.
"Our efforts in cost reduction and service quality improvement
across our business lines have helped us weather the storm. The
measures we have taken make our ecosystem stronger and more
resilient. Moving forward, we are confident that BEST's strength in
technology, domestic and global supply chain management as well as
logistics capabilities will allow us to capture growth
opportunities and create long-term value," concluded Mr.
Chou.
Gloria Fan, BEST's Chief
Financial Officer, added, "Despite the headwinds, our third quarter
performance was encouraging. Our total revenue for the quarter,
excluding UCargo and Capital, decreased slightly by 2.3% year over
year but we significantly narrowed our non-GAAP net loss by 16.0%,
excluding the one-off gain recognized on selling assets in the
third quarter of 2021. We maintained a healthy balance sheet with
cash and cash equivalents, restricted cash, and short-term
investments of RMB3.3 billion after
repurchasing an aggregate principal amount of RMB746.5 million of existing Convertible Senior
Notes. Our net cash position was RMB1.1 billion at the end of the quarter. We
believe we are well positioned for sustainable growth and
profitability as we drive long-term value for our customers through
our Freight, integrated Supply Chain Management and Global
logistics solutions."
FINANCIAL HIGHLIGHTS ([1])
For the Third Quarter Ended September
30, 2022:([2])
- Revenue was RMB2,029.1
million (US$285.3 million),
compared with RMB2,824.1 million in
the third quarter of 2021. The decrease was primarily due to the
winding-down of the BEST UCargo business line and lower Global
parcel volume. Revenue generated from UCargo was approximately
RMB0.4 million (US$0.06 million), compared with RMB729.9 million in the same quarter of
2021.
- Gross Loss was RMB39.0
million (US$5.5 million),
compared with RMB108.9 million in the
third quarter of 2021. The decrease in gross loss was primarily due
to improved gross margin from BEST Freight and BEST Supply Chain
business lines. Gross Loss Margin was 1.9% for the third
quarter of 2022, compared with a Gross Loss Margin of 3.9% in the
same period of 2021.
- Net Loss from continuing operations was
RMB378.9 million (US$53.3 million), compared with RMB191.6 million in the third quarter of 2021.
Non-GAAP Net Loss from continuing
operations([3])([4]) was
RMB363.0 million (US$51.0 million), compared with RMB223.4 million in the third quarter of 2021.
Excluding the one-off gain of RMB208.9
million recognized on selling assets in the third quarter of
2021, non-GAAP net loss has narrowed by RMB69.3 million year over year.
- Diluted loss per ADS([5]) from continuing
operations was RMB4.40
(US$0.62), compared with a loss of
RMB2.30 in the third quarter of 2021.
Non-GAAP diluted loss per ADS(3)(4) from continuing
operations was RMB4.20
(US$0.59), compared with a loss of
RMB2.71 in the third quarter of
2021.
- EBITDA([6]) from continuing operations
was negative RMB335.9 million
(US$47.2 million), compared with
negative RMB116.7 million in the
third quarter of 2021. Adjusted EBITDA(6) from continuing
operations was negative RMB320.0
million (US$45.0 million),
compared with negative RMB148.4
million in the third quarter of 2021.
BUSINESS HIGHLIGHTS([7])
BEST Freight – In the third quarter of 2022, Freight's
volume increased by 4.1% year over year, while its revenue
increased by 9.7% to RMB1,325.8
million compared with the second quarter of 2022. The
Company remained focused on developing its e-commerce related
business, which contributed 21.1% of total volume in the third
quarter of 2022, representing an increase of 0.7% year over year.
Freight's net loss decreased by 36.8% or RMB81.0 million compared with the same quarter of
2021 as we continued to reduce expenses and improve operating
efficiency.
BEST UCargo's operations and financial results are now
consolidated with BEST Freight.
BEST Supply Chain Management – In the third quarter of
2022, BEST SCM continued to terminate low margin legacy accounts
and penetrate new markets with better unit economics. Its
distribution volume increased by 84.5% but total number of orders
fulfilled by Cloud OFCs decreased by 14.8% year over year.
The total revenue for SCM in the third quarter of 2022
increased by 15.2% to RMB461.5
million year over year, and gross margin improved by 3.5
percentage points to 7.2%, narrowing SCM's net loss by RMB17.4 million, or 64.3%.
BEST Global – The market in SEA remained challenging in
the third quarter of 2022. Along with the relaxed COVID-19 pandemic
control measures in the region, there was a noticeable shift in
consumer consumption activities from online to offline, which
negatively impacted the e-commerce logistics industry. Meanwhile,
some major e-commerce platforms increased reliance on their own
logistics capabilities and gradually reduced their reliance on
third-party logistics service providers. As a result,
Global's parcel volume decreased by 27.1% year over year to 27.0
million in the third quarter of 2022. However, parcel volumes
in Vietnam and Singapore increased by 34.4% and 23.5%, and
their revenues increased by 42.3% and 45.2%, respectively.
Others
As part of its Strategic Refocusing Program, the Company
continued to wind down the Capital business line in the third
quarter of 2022 and expects the wind down to be substantially
completed by the end of 2022.
Key Operational Metrics
|
Three Months
Ended
|
% Change
YOY
|
|
|
September 30,
2020
|
|
September 30,
2021
|
|
September
30,
2022
|
|
2021 vs
2020
|
|
2022 vs
2021
|
|
|
|
|
|
Freight Volume (Tonne
in '000)
|
2,464
|
|
2,427
|
2,527
|
|
-1.5 %
|
|
4.1 %
|
Supply Chain
Management
Orders Fulfilled (in '000)
|
102,171
|
103,638
|
88,288
|
|
1.4 %
|
-14.8 %
|
Global Parcel Volume
in SEA (in '000)
|
20,754
|
|
37,082
|
|
27,044
|
|
78.7 %
|
|
-27.1 %
|
|
|
|
|
|
|
|
|
|
|
|
FINANCIAL RESULTS ([8])
For the Third Quarter Ended September
30, 2022:
Revenue
The following table sets forth a breakdown of revenue by
business segment for the periods indicated.
Table 1 – Breakdown of Revenue by Business Segment
|
Three Months
Ended
|
|
|
September 30,
2021
|
|
September 30,
2022
|
|
|
(In '000, except for
%)
|
RMB
|
% of
Revenue
|
|
RMB
|
US$
|
% of
Revenue
|
|
% Change
YOY
|
Total
Freight
|
2,088,228
|
73.9 %
|
|
1,325,833
|
186,383
|
65.3 %
|
|
(36.5 %)
|
-Freight
|
1,358,305
|
48.1 %
|
|
1,325,401
|
186,322
|
65.3 %
|
|
(2.4 %)
|
-Legacy
UCargo
|
729,923
|
25.8 %
|
|
432
|
61
|
0.0 %
|
|
(99.9 %)
|
Supply Chain
Management
|
400,551
|
14.2 %
|
|
461,527
|
64,880
|
22.7 %
|
|
15.2 %
|
Global
|
298,267
|
10.6 %
|
|
211,347
|
29,711
|
10.4 %
|
|
(29.1 %)
|
Others([9])
|
37,046
|
1.3 %
|
|
30,417
|
4,276
|
1.6 %
|
|
(17.9 %)
|
Total
Revenue
|
2,824,092
|
100.0 %
|
|
2,029,124
|
285,250
|
100.0 %
|
|
(28.1 %)
|
- Freight Service Revenue was RMB1,325.8
million (US$186.4 million) for
the third quarter of 2022, compared with RMB2,088.2 million in the same period last year,
of which, RMB0.4 million and
RMB729.9 million were from the legacy
UCargo business line, respectively. Freight service revenue,
excluding the legacy UCargo business, decreased by 2.4% year over
year, primarily due to a 6.1% decrease in average selling price per
tonne.
- Supply Chain Management Service Revenue increased by 15.2% year
over year to RMB461.5 million
(US$64.9 million) for the third
quarter of 2022 from RMB400.6 million
in the same period of 2021, primarily due to newly signed customers
with high unit economics following our customer structure
optimization strategy, as well as improved service capability.
- Global Service Revenue decreased by 29.1% year over year to
RMB211.3 million (US$29.7 million) for the third quarter of 2022
from RMB298.3 million in the same
period of 2021, primarily due to decreased parcel volume in
Thailand and Malaysia. E-commerce businesses in SEA were
impacted by the shift in consumer consumption activities from
online to offline and some major e-commerce platforms reduced their
reliance on services. However, we continued focusing on expanding
our franchisee network and improving service quality, and as a
result, revenues in Vietnam and
Singapore achieved year-over-year
increases of 42.3% and 45.2%, respectively.
Cost of Revenue
The following table sets forth a breakdown of cost of revenue by
business segment for the periods indicated.
Table
2 – Breakdown of Cost of Revenue by Business Segment
|
Three Months
Ended
|
|
% of Revenue
Change
YOY
|
|
September 30,
2021
|
|
September 30,
2022
|
|
(In '000, except for
%)
|
RMB
|
% of
Revenue
|
|
RMB
|
US$
|
% of
Revenue
|
|
Freight
|
(2,197,843)
|
105.2 %
|
|
(1,365,074)
|
(191,899)
|
103.0 %
|
|
(2.2 %)
|
Supply Chain
Management
|
(385,443)
|
96.2 %
|
|
(428,190)
|
(60,194)
|
92.8 %
|
|
(3.4 %)
|
Global
|
(318,420)
|
106.8 %
|
|
(255,341)
|
(35,895)
|
120.8 %
|
|
14.0 %
|
Others
|
(31,281)
|
84.4 %
|
|
(19,469)
|
(2,737)
|
64.0 %
|
|
(20.4 %)
|
Total Cost of
Revenue
|
(2,932,987)
|
103.9 %
|
|
(2,068,074)
|
(290,725)
|
101.9 %
|
|
(2.0%)
|
- Cost of Revenue for Freight was RMB1,365.1 million (US$191.9 million), or 103.0% of revenue, in the
third quarter of 2022. The 2.2% year-over-year decrease in cost of
revenue as a percentage of revenue was mainly due to improved
operational efficiency and effective cost control measures.
- Cost of Revenue for Supply Chain Management was RMB428.2 million (US$60.2
million), or 92.8% of revenue, in the third quarter of 2022.
The 3.4% year-over-year decrease in cost of revenue as a percentage
of revenue was primarily due to effective cost control measures and
customer structure optimization.
- Cost of Revenue for Global was RMB255.3
million (US$35.9 million), or
120.8% of revenue, in the third quarter of 2022. The 14.0%
year-over-year increase in cost of revenue as a percentage of
revenue was primarily due to lower parcel volume.
- Cost of Revenue for Others was RMB19.5
million (US$2.7 million), or
64.0% of revenue, in the third quarter of 2022, representing a
20.4% year-over-year decrease.
Gross loss was RMB39.0
million (US$5.5 million) in
the third quarter of 2022, compared with a gross loss of
RMB108.9 million in the third quarter
of 2021; Gross Margin was negative 1.9%, compared with
negative 3.9% in the third quarter of 2021.
Operating Expenses
Selling, General and Administrative ("SG&A") Expenses
were RMB275.2 million (US$38.7 million), or 13.6% of revenue in the
third quarter of 2022, compared with RMB274.8 million, or 9.7% of revenue in the same
quarter of 2021.
Research and Development Expenses were RMB39.6 million (US$5.6
million), or 2.0% of revenue in the third quarter of 2022,
compared with RMB42.3 million, or
1.5% of revenue in the third quarter of 2021, primarily due to
reduced headcounts.
Share-based Compensation ("SBC") Expenses included in the
cost and expense items above were RMB15.9
million (US$2.2 million) in
the third quarter of 2022, compared with RMB26.9 million in the same period of 2021. Of
the total SBC expenses, RMB0.09
million (US$0.01 million) was
allocated to cost of revenue, RMB0.7
million (US$0.1 million) was
allocated to selling expenses, RMB13.9
million (US$2.0 million) was
allocated to general and administrative expenses, and RMB1.2 million (US$0.2
million) was allocated to research and development
expenses.
Net Loss and Non-GAAP Net Loss from continuing
operations
Net Loss from continuing operations in the third quarter
of 2022 was RMB378.9 million
(US$53.3 million), compared with
RMB191.6 million in the same period
of 2021. Excluding SBC expenses and gain from appreciation of
investment, Non-GAAP Net Loss from continuing operations in
the third quarter of 2022 was RMB363.0
million (US$51.0 million),
compared with RMB223.4 million in the
third quarter of 2021.
Diluted loss per ADS and Non-GAAP diluted loss per ADS from
continuing operations
Diluted loss per ADS from continuing operations in the
third quarter of 2022 was RMB4.40
(US$0.62), compared with a loss of
RMB2.30 in the same period of 2021.
Excluding SBC expenses, amortization of intangible assets resulting
from business acquisitions and gain from appreciation of
investment, Non-GAAP diluted loss per ADS from continuing
operations in the third quarter of 2022 was RMB4.20 (US$0.59),
compared with a loss of RMB2.71 in
the third quarter of 2021. A reconciliation of non-GAAP diluted
loss per ADS to diluted loss per ADS is included at the end of this
results announcement.
Adjusted EBITDA and Adjusted EBITDA Margin from continuing
operations
Adjusted EBITDA from continuing operations in the third
quarter of 2022 was negative RMB320.0
million (US$45.0 million),
compared with negative RMB148.4
million in the same period of 2021. Adjusted EBITDA
Margin from continuing operations in the third quarter of 2022
was negative 15.8%, compared with negative 5.3% in the same period
of 2021.
Cash and Cash Equivalents, Restricted Cash and Short-term
Investments
As of September 30, 2022, cash and
cash equivalents, restricted cash and short-term investments were
RMB3.3 billion (US$468.4 million), compared with RMB2.9 billion as of September 30, 2021. In September 2022, the Company bought back an
aggregate principal amount of US$105.1
million (RMB746.5 million) of
its existing 1.75% Convertible Senior Notes due 2024.
Capital Expenditures ("CAPEX")
CAPEX was RMB48.1 million
(US$6.8 million) or 2.4% of total
revenue in the third quarter of 2022, compared with CAPEX of
RMB11.8 million, or 0.4% of total
revenue, in the same period of 2021.
SHARES OUTSTANDING
As of November 8, 2022, the
Company had approximately 393.0 million ordinary shares
outstanding([10]). Each American Depositary Share
represents five (5) Class A ordinary shares.
FINANCIAL GUIDANCE
Due to the uncertainties relating to the macro environment, the
Company is not providing any financial guidance or revenue outlook
at this time. BEST is driving each of its business units toward a
speedy recovery as the COVID-19 pandemic related restrictions
ease.
WEBCAST AND CONFERENCE CALL INFORMATION
The Company will hold a conference call at 8:00 pm U.S. Eastern Time on November 16, 2022 (9:00
am Beijing Time on November 17,
2022), to discuss its financial results and operating
performance for the third quarter of 2022.
Participants may access the call by dialing the following
numbers:
United
States
: +1-888-317-6003
Hong
Kong
: 800-963976 or +852-5808-1995
Mainland
China
: 4001-206115
International
: +1-412-317-6061
Participant Elite Entry
Number
: 4725664
A replay of the conference call will be accessible through
November 23, 2022 by dialing the
following numbers:
United
States
: +1-877-344-7529
International
: +1-412-317-0088
Replay Access Code
:
8040204
Please visit the Company's investor relations website to view
the earnings release prior to the conference call. A live and
archived webcast of the conference call and a corporate
presentation will be available at the same site.
ABOUT BEST INC.
BEST Inc. (NYSE: BEST) is a leading integrated smart supply
chain solutions and logistics services provider in China and SEA. Through its proprietary
technology platform and extensive networks, BEST offers a
comprehensive set of logistics and value-added services, including
freight delivery, supply chain management and global logistics
services. BEST's mission is to empower business and enrich life by
leveraging technology and business model innovation to create a
smarter, more efficient supply chain. For more information, please
visit: http://www.best-inc.com/en/.
SAFE HARBOR STATEMENT
This announcement 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," "future," "intends," "plans,"
"believes," "estimates" and similar statements. Among other things,
the business outlook and quotations from management in this
announcement, as well as BEST's strategic and operational plans,
contain forward-looking statements. BEST may also make written or
oral forward-looking statements in its periodic reports to the U.S.
Securities and Exchange Commission (the "SEC"), in its annual
report 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 BEST'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: BEST's goals and strategies; BEST's future business
development, results of operations and financial condition; BEST's
ability to maintain and enhance its ecosystem; BEST's ability to
compete effectively; BEST's ability to continue to innovate, meet
evolving market trends, adapt to changing customer demands and
maintain its culture of innovation; fluctuations in general
economic and business conditions in China and other countries in which BEST
operates, and assumptions underlying or related to any of the
foregoing. Further information regarding these and other risks is
included in BEST's filings with the SEC. All information provided
in this press release and in the attachments is as of the date of
this press release, and BEST does not undertake any obligation to
update any forward-looking statement, except as required under
applicable law.
USE OF NON-GAAP FINANCIAL MEASURES
In evaluating its business, BEST considers and uses non-GAAP
measures, such as non-GAAP net loss/income, non-GAAP net
loss/income margin, adjusted EBITDA, adjusted EBITDA margin,
EBITDA, and non-GAAP Diluted earnings/loss per ADS, as supplemental
measures in the evaluation of the Company's operating results and
in the Company's financial and operational decision-making. The
Company believes these non-GAAP financial measures that help
identify underlying trends in the Company's business that could
otherwise be distorted by the effect of the expenses and gains that
the Company includes in loss from operations and net loss. The
Company believes that these non-GAAP financial measures provide
useful information about its operating results, enhance the overall
understanding of its past performance and future prospects and
allow for greater visibility with respect to key metrics used by
the Company's management in its financial and operational
decision-making. 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 Non-GAAP Measures to the Nearest Comparable GAAP Measures" in
the results announcement.
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.
Summary of Unaudited
Condensed Consolidated Income Statements
(In
Thousands)
|
|
|
Three Months Ended
September 30,
|
Nine Months Ended
September 30,
|
|
2021
|
2022
|
2021
|
2022
|
|
RMB
|
RMB
|
US$
|
RMB
|
RMB
|
US$
|
Revenue
|
|
|
|
|
|
|
Freight
|
2,088,228
|
1,325,833
|
186,383
|
6,390,417
|
3,627,082
|
509,887
|
-Freight
|
1,358,305
|
1,325,401
|
186,322
|
3,931,359
|
3,607,081
|
507,075
|
-Legacy
UCargo
|
729,923
|
432
|
61
|
2,459,058
|
20,001
|
2,812
|
Supply Chain
Management
|
400,551
|
461,527
|
64,880
|
1,327,767
|
1,321,473
|
185,770
|
Global
|
298,267
|
211,347
|
29,711
|
863,291
|
721,227
|
101,388
|
Others
|
37,046
|
30,417
|
4,276
|
119,507
|
92,895
|
13,059
|
Total
Revenue
|
2,824,092
|
2,029,124
|
285,250
|
8,700,982
|
5,762,677
|
810,104
|
Cost of
Revenue
|
|
|
|
|
|
|
Freight
|
(2,197,843)
|
(1,365,074)
|
(191,899)
|
(6,435,898)
|
(3,837,911)
|
(539,525)
|
Supply Chain
Management
|
(385,443)
|
(428,190)
|
(60,194)
|
(1,245,479)
|
(1,233,307)
|
(173,376)
|
Global
|
(318,420)
|
(255,341)
|
(35,895)
|
(912,119)
|
(817,573)
|
(114,933)
|
Others
|
(31,281)
|
(19,469)
|
(2,737)
|
(78,464)
|
(78,967)
|
(11,101)
|
Total Cost of
Revenue
|
(2,932,987)
|
(2,068,074)
|
(290,725)
|
(8,671,960)
|
(5,967,758)
|
(838,934)
|
Gross
Loss/(Profit)
|
(108,895)
|
(38,950)
|
(5,476)
|
29,022
|
(205,081)
|
(28,830)
|
Selling
Expenses
|
(67,327)
|
(62,241)
|
(8,750)
|
(187,198)
|
(183,297)
|
(25,767)
|
General and
Administrative
Expenses
|
(207,505)
|
(212,921)
|
(29,932)
|
(599,726)
|
(680,607)
|
(95,678)
|
Research and
Development
Expenses
|
(42,259)
|
(39,632)
|
(5,571)
|
(129,910)
|
(114,934)
|
(16,157)
|
Other operating
income/(loss), net
|
7,688
|
(14,185)
|
(1,994)
|
148,230
|
105,430
|
14,821
|
Loss from
Operations
|
(418,298)
|
(367,929)
|
(51,723)
|
(739,582)
|
(1,078,489)
|
(151,612)
|
Interest
Income
|
7,562
|
19,981
|
2,809
|
31,923
|
61,153
|
8,597
|
Interest
Expense
|
(39,924)
|
(20,569)
|
(2,892)
|
(113,441)
|
(72,729)
|
(10,224)
|
Foreign Exchange
Gain/(loss)
|
1,081
|
(98,628)
|
(13,865)
|
370
|
(201,048)
|
(28,263)
|
Other Income
|
268,106
|
2,657
|
374
|
314,366
|
23,765
|
3,341
|
Other
Expense
|
(9,107)
|
(464)
|
(65)
|
(20,596)
|
19,578
|
2,752
|
Gain on changes in the
fair value of
derivative assets/liabilities
|
-
|
86,108
|
12,105
|
-
|
149,196
|
20,974
|
Loss before Income
Tax and
Share of Net Loss of Equity
Investees
|
(190,580)
|
(378,844)
|
(53,257)
|
(526,960)
|
(1,098,574)
|
(154,435)
|
Income Tax
Expense
|
(1,051)
|
(93)
|
(13)
|
(2,698)
|
(405)
|
(57)
|
Loss before Share of
Net loss
of Equity Investees
|
(191,631)
|
(378,937)
|
(53,270)
|
(529,658)
|
(1,098,979)
|
(154,492)
|
Share of Net Loss of
Equity Investees
|
(16)
|
-
|
-
|
(58)
|
-
|
-
|
Net Loss from
continuing operations
|
(191,647)
|
(378,937)
|
(53,270)
|
(529,716)
|
(1,098,979)
|
(154,492)
|
Net loss from
discontinued operations
|
(459,188)
|
(8,904)
|
(1,252)
|
(1,205,911)
|
(6,677)
|
(939)
|
Net
Loss
|
(650,835)
|
(387,841)
|
(54,522)
|
(1,735,627)
|
(1,105,656)
|
(155,431)
|
Net Loss from
continuing
operations attributable to non-
controlling interests
|
(12,623)
|
(33,248)
|
(4,674)
|
(23,552)
|
(83,382)
|
(11,722)
|
Net Loss
attributable to BEST
Inc.
|
(638,212)
|
(354,593)
|
(49,848)
|
(1,712,075)
|
(1,022,274)
|
(143,709)
|
Summary of
Unaudited Condensed Consolidated Balance Sheets
(In
Thousands)
|
|
|
As of December
31,2021
|
|
As of September 30,
2022
|
|
RMB
|
|
RMB
|
US$
|
Assets
|
|
|
|
|
Current
Assets
|
|
|
|
|
Cash and Cash
Equivalents
|
3,571,745
|
|
767,359
|
107,874
|
Restricted
Cash
|
675,159
|
|
251,152
|
35,306
|
Accounts and Notes
Receivables
|
827,631
|
|
821,680
|
115,510
|
Inventories
|
25,622
|
|
20,820
|
2,927
|
Prepayments and Other
Current
Assets
|
1,172,472
|
|
922,893
|
129,738
|
Short‑term
Investments
|
147,359
|
|
836,802
|
117,636
|
Amounts Due from
Related Parties
|
125,198
|
|
59,575
|
8,375
|
Lease Rental
Receivables
|
298,364
|
|
74,127
|
10,421
|
Total Current
Assets
|
6,843,550
|
|
3,754,408
|
527,786
|
Non‑current
Assets
|
|
|
|
|
Property and Equipment,
Net
|
762,642
|
|
757,470
|
106,483
|
Intangible Assets,
Net
|
55,684
|
|
70,233
|
9,873
|
Long‑term
Investments
|
219,171
|
|
189,171
|
26,593
|
Goodwill
|
54,135
|
|
54,135
|
7,610
|
Non‑current
Deposits
|
92,866
|
|
41,473
|
5,830
|
Other Non‑current
Assets
|
111,640
|
|
75,626
|
10,631
|
Restricted
Cash
|
1,069,244
|
|
1,476,649
|
207,584
|
Lease Rental
Receivables
|
235,429
|
|
71,534
|
10,056
|
Operating Lease
Right-of-use
Assets
|
1,899,522
|
|
1,709,283
|
240,287
|
Total non‑current
Assets
|
4,500,333
|
|
4,445,574
|
624,949
|
Total
Assets
|
11,343,883
|
|
8,199,982
|
1,152,735
|
Liabilities and
Shareholders'
Equity
|
|
|
|
|
Current
Liabilities
|
|
|
|
|
Long-term
borrowings-current
|
287,814
|
|
110,539
|
15,539
|
Convertible Senior
Notes held by
related parties
|
633,475
|
|
1,065,224
|
149,747
|
Convertible Senior
Notes held by
third parties
|
633,475
|
|
78
|
11
|
Short‑term Bank
Loans
|
530,495
|
|
126,288
|
17,753
|
Accounts and Notes
Payable
|
1,353,150
|
|
1,533,502
|
215,576
|
Income Tax
Payable
|
587
|
|
1,543
|
217
|
Customer Advances and
Deposits
and Deferred Revenue
|
298,353
|
|
260,099
|
36,564
|
Accrued Expenses and
Other
Liabilities
|
1,591,639
|
|
1,143,195
|
160,708
|
Financing Lease
Liabilities
|
1,851
|
|
1,872
|
263
|
Operating Lease
Liabilities
|
518,248
|
|
501,296
|
70,471
|
Amounts Due to Related
Parties
|
2,763
|
|
12,443
|
1,749
|
Total Current
Liabilities
|
5,851,850
|
|
4,756,079
|
668,599
|
|
|
|
|
|
Summary of
Unaudited Condensed Consolidated Balance Sheets
(Cont'd)
(In
Thousands)
|
|
|
As of December 31,
2021
|
|
As of September 30,
2022
|
|
RMB
|
|
RMB
|
US$
|
Non-current
Liabilities
|
|
|
|
|
Convertible senior
notes held by
related
parties
|
955,097
|
|
-
|
-
|
Long-term
borrowings
|
67,080
|
|
15,828
|
2,225
|
Operating Lease
Liabilities
|
1,456,843
|
|
1,273,950
|
179,089
|
Financing Lease
Liabilities
|
2,121
|
|
1,428
|
201
|
Other Non‑current
Liabilities
|
24,261
|
|
27,913
|
3,924
|
Long-term Bank
Loans
|
769,767
|
|
944,808
|
132,819
|
Total Non‑current
Liabilities
|
3,275,169
|
|
2,263,927
|
318,258
|
Total
Liabilities
|
9,127,019
|
|
7,020,006
|
986,857
|
Mezzanine
Equity:
|
|
|
|
|
Convertible
Non-controlling Interests
|
191,865
|
|
191,865
|
26,972
|
Total mezzanine
equity
|
191,865
|
|
191,865
|
26,972
|
Shareholders'
Equity
|
|
|
|
|
Ordinary
Shares
|
25,988
|
|
25,988
|
3,653
|
Treasury
Shares
|
(113,031)
|
|
-
|
-
|
Additional Paid‑In
Capital
|
19,522,173
|
|
19,465,841
|
2,736,465
|
Statutory
reserves
|
167
|
|
-
|
-
|
Accumulated
Deficit
|
(17,471,716)
|
|
(18,550,280)
|
(2,607,757)
|
Accumulated Other
Comprehensive Income
|
107,379
|
|
118,635
|
16,677
|
BEST Inc.
Shareholders' Equity
|
2,070,960
|
|
1,060,184
|
149,038
|
Non-controlling
Interests
|
(45,961)
|
|
(72,073)
|
(10,132)
|
Total Shareholders'
Equity
|
2,024,999
|
|
988,111
|
138,906
|
Total Liabilities,
Mezzanine Equity
and Shareholders' Equity
|
11,343,883
|
|
8,199,982
|
1,152,735
|
Summary of
Unaudited Condensed Consolidated Statements of Cash
Flows
(In
Thousands)
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended September
30,
|
|
2021
|
2022
|
|
2021
|
2022
|
|
RMB
|
RMB
|
US$
|
|
RMB
|
RMB
|
US$
|
Net cash used in
continuing
operating activities
|
(236,492)
|
(250,375)
|
(35,197)
|
|
(382,503)
|
(809,772)
|
(113,836)
|
Net cash used in
discontinued
operating activities
|
(921,754)
|
(7,917)
|
(1,113)
|
|
(1,525,286)
|
(66,174)
|
(9,303)
|
Net cash used in
operating
activities
|
(1,158,246)
|
(258,292)
|
(36,310)
|
|
(1,907,789)
|
(875,946)
|
(123,139)
|
Net cash generated
from/(used
in) continuing investing
activities
|
1,159,859
|
891,756
|
125,361
|
|
1,753,752
|
(88,780)
|
(12,480)
|
Net cash used in
discontinued
Investing activities
|
(104,948)
|
-
|
-
|
|
(350,688)
|
-
|
-
|
Net cash
generated
from/(used in) investing
activities
|
1,054,911
|
891,756
|
125,361
|
|
1,403,064
|
(88,780)
|
(12,480)
|
Net cash
(used
in)/generated
from continuing
financing activities
|
353,528
|
(982,052)
|
(138,055)
|
|
508,734
|
(1,948,848)
|
(273,965)
|
Net cash used in
discontinued
financing activities
|
(294,139)
|
-
|
-
|
|
(807,259)
|
-
|
-
|
Net
cash used in financing
activities
|
59,389
|
(982,052)
|
(138,055)
|
|
(298,525)
|
(1,948,848)
|
(273,965)
|
Exchange Rate Effect on
Cash
and Cash Equivalents,
and
Restricted Cash
|
3,895
|
44,482
|
6,253
|
|
(26,520)
|
92,586
|
13,016
|
Net
decrease in Cash and
Cash Equivalents, and
Restricted Cash
|
(40,051)
|
(304,106)
|
(42,751)
|
|
(829,770)
|
(2,820,988)
|
(396,568)
|
Cash and Cash
Equivalents,
and Restricted Cash at
Beginning of Period
|
3,419,402
|
2,799,266
|
393,515
|
|
4,209,121
|
5,316,148
|
747,332
|
Cash and Cash
Equivalents,
and Restricted Cash at End
of Period
|
3,379,351
|
2,495,160
|
350,764
|
|
3,379,351
|
2,495,160
|
350,764
|
Less: Cash and Cash
Equivalents, and Restricted
Cash held for sales at end of
the Period
|
511,696
|
-
|
-
|
|
511,696
|
-
|
-
|
Cash and Cash
Equivalents,
and Restricted Cash from
continuing operations at
End of Period
|
2,867,655
|
2,495,160
|
350,764
|
|
2,867,655
|
2,495,160
|
350,764
|
|
|
|
|
|
|
|
|
|
RECONCILIATIONS OF NON-GAAP MEASURES TO THE NEAREST
COMPARABLE GAAP MEASURES
For the Company's continuing operations, the table below sets
forth a reconciliation of the Company's net (loss)/income to
EBITDA, adjusted EBITDA and adjusted EBITDA margin for the periods
indicated:
Table 3 – Reconciliation of EBITDA, Adjusted
EBITDA and Adjusted EBITDA Margin
|
Three Months Ended
September 30, 2022
|
(In
RMB'000)
|
Freight
|
Supply
Chain
|
Global
|
Others
|
Unallocated([11])
|
Total
|
Net
Loss
|
(138,749)
|
(9,664)
|
(110,426)
|
(48,601)
|
(71,497)
|
(378,937)
|
Add
|
|
|
|
|
|
|
Depreciation &
Amortization
|
19,417
|
8,397
|
6,531
|
1,976
|
6,025
|
42,346
|
Interest
Expense
|
-
|
-
|
-
|
-
|
20,569
|
20,569
|
Income Tax
Expense
|
-
|
(22)
|
-
|
115
|
-
|
93
|
Subtract
|
|
|
|
|
|
|
Interest
Income
|
-
|
-
|
-
|
-
|
(19,981)
|
(19,981)
|
EBITDA
|
(119,332)
|
(1,289)
|
(103,895)
|
(46,510)
|
(64,884)
|
(335,910)
|
Add
|
|
|
|
|
|
|
Share-based
Compensation
Expenses
|
2,511
|
1,314
|
1,354
|
23
|
10,694
|
15,896
|
Adjusted
EBITDA
|
(116,821)
|
25
|
(102,541)
|
(46,487)
|
(54,190)
|
(320,014)
|
Adjusted
EBITDA
Margin
|
-8.8 %
|
0.0 %
|
-48.5 %
|
-152.8 %
|
-
|
-15.8 %
|
|
|
|
|
Three Months Ended
September 30, 2021
|
(In
RMB'000)
|
Freight
|
Supply
Chain
|
Global
|
Others
|
Unallocated
|
Total
|
Net
Income/(Loss)
|
(219,708)
|
(27,069)
|
(68,869)
|
(25,181)
|
149,180
|
(191,647)
|
Add
|
|
|
|
|
|
|
Depreciation &
Amortization
|
20,767
|
9,055
|
4,981
|
397
|
6,363
|
41,563
|
Interest
Expense
|
-
|
-
|
-
|
-
|
39,924
|
39,924
|
Income Tax
Expense
|
-
|
(130)
|
-
|
1,182
|
(1)
|
1,051
|
Subtract
|
|
|
|
|
|
|
Interest
Income
|
-
|
-
|
-
|
-
|
(7,562)
|
(7,562)
|
EBITDA
|
(198,941)
|
(18,144)
|
(63,888)
|
(23,602)
|
187,904
|
(116,671)
|
Add
|
|
|
|
|
|
|
Share-based
Compensation
Expenses
|
3,459
|
2,160
|
2,068
|
171
|
19,038
|
26,896
|
Subtract
|
|
|
|
|
|
|
Gain from
appreciation of
investments
|
-
|
-
|
-
|
-
|
(58,643)
|
(58,643)
|
Adjusted
EBITDA
|
(195,482)
|
(15,984)
|
(61,820)
|
(23,431)
|
148,299
|
148,418
|
Adjusted
EBITDA
Margin
|
-9.4 %
|
-4.0 %
|
-20.7 %
|
-63.2 %
|
-
|
-5.3 %
|
For the Company's continuing operations, the table below sets
forth a reconciliation of the Company's net (loss)/income to
non-GAAP net Income/(loss), non-GAAP net Income/(loss) margin for
the periods indicated:
Table 4 – Reconciliation of Non-GAAP Net (Loss)/Income
and Non-GAAP Net (Loss)/Income Margin
|
Three Months Ended
September 30, 2022
|
(In
RMB'000)
|
Freight
|
Supply
Chain
|
Global
|
Others
|
Unallocated
|
Total
|
Net Loss
|
(138,749)
|
(9,664)
|
(110,426)
|
(48,601)
|
(71,497)
|
(378,937)
|
Add
|
|
|
|
|
|
|
Share-based
Compensation
Expenses
|
2,511
|
1,314
|
1,354
|
23
|
10,694
|
15,896
|
Non-GAAP Net
Loss
|
(136,238)
|
(8,350)
|
(109,072)
|
(48,578)
|
(60,803)
|
(363,041)
|
Non-GAAP Net
Loss/Margin
|
-10.3 %
|
-1.8 %
|
-51.6 %
|
-159.7 %
|
-
|
-17.9 %
|
|
|
|
|
|
Three Months Ended
September 30, 2021
|
(In
RMB'000)
|
Freight
|
Supply
Chain
|
Global
|
Others
|
Unallocated
|
Total
|
Net
Income/(Loss)
|
(219,708)
|
(27,069)
|
(68,869)
|
(25,181)
|
149,180
|
(191,647)
|
Add
|
|
|
|
|
|
|
Share-based
Compensation
Expenses
|
3,459
|
2,160
|
2,068
|
171
|
19,038
|
26,896
|
Subtract
|
|
|
|
|
|
|
Gain from
appreciation of
investments
|
-
|
-
|
-
|
-
|
(58,643)
|
(58,643)
|
Non-GAAP Net
(Loss)/Income
|
(216,249)
|
(24,909)
|
(66,801)
|
(25,010)
|
109,575
|
(223,394)
|
Non-GAAP Net
(Loss)/Income
Margin
|
-10.4 %
|
-6.2 %
|
-22.4 %
|
-67.5 %
|
-
|
-7.9 %
|
For the Company's continuing operations, the table below sets
forth a reconciliation of the Company's diluted loss per ADS to
Non-GAAP diluted loss per ADS for the periods indicated:
Table 5 – Reconciliation of
diluted loss per ADS and Non-GAAP diluted loss per ADS
|
Three Months Ended
September 30,
|
|
Nine Months
Ended September 30,
|
|
2022
|
|
2022
|
(In
'000)
|
RMB
|
US$
|
|
RMB
|
US$
|
Net Loss Attributable
to Ordinary Shareholders
|
(345,689)
|
(48,596)
|
|
(1,015,597)
|
(142,770)
|
Add
|
|
|
|
|
|
Share-based
Compensation Expenses
|
15,896
|
2,234
|
|
56,518
|
7,945
|
Non-GAAP Net Loss
Attributable to Ordinary
Shareholders
|
(329,793)
|
(46,362)
|
|
(959,079)
|
(134,825)
|
Weighted Average
Diluted Ordinary
Shares
Outstanding During the Quarter
|
|
|
|
|
|
Diluted
|
392,842,492
|
392,842,492
|
|
388,632,377
|
388,632,377
|
Diluted
(Non-GAAP)
|
392,842,492
|
392,842,492
|
|
388,632,377
|
388,632,377
|
Diluted loss
per ordinary share
|
(0.88)
|
(0.12)
|
|
(2.61)
|
(0.37)
|
Add
|
|
|
|
|
|
Non-GAAP adjustment to
net loss per
ordinary share
|
0.04
|
0.00
|
|
0.14
|
0.02
|
Non-GAAP diluted
loss per ordinary share
|
(0.84)
|
(0.12)
|
|
(2.47)
|
(0.35)
|
|
|
|
|
|
|
Diluted loss
per ADS
|
(4.40)
|
(0.62)
|
|
(13.07)
|
(1.84)
|
Add
|
|
|
|
|
|
Non-GAAP adjustment to
net loss per ADS
|
0.20
|
0.03
|
|
0.73
|
0.11
|
Non-GAAP diluted
loss per ADS
|
(4.20)
|
(0.59)
|
|
(12.34)
|
(1.73)
|
([1]) All numbers
presented have been rounded to the nearest integer, tenth, or
hundredth, and year over year comparisons are based on figures
before
rounding.
|
([2]) In December 2021,
BEST sold its China express business, the principal terms of which
were previously announced. As a result, China express business has
been deconsolidated from the Company and its historical financial
results are reflected in the Company's consolidated financial
statements as discontinued operations accordingly. The financial
information and non-GAAP financial information disclosed in this
press release is presented on a continuing operations basis, unless
otherwise specifically stated.
|
([3]) Non-GAAP net
income/loss represents net income/loss excluding share-based
compensation expenses, amortization of intangible assets resulting
from business acquisitions, and fair value change of equity
investments (if any).
|
([4]) See the sections
entitled "Use of Non-GAAP Financial Measures" and "Reconciliations
of Non-GAAP Measures to the Nearest Comparable GAAP Measures" for
more information about the non-GAAP measures referred to within
this results announcement.
|
([5]) Diluted
earnings/loss per ADS, is calculated by dividing net income/loss
attributable to ordinary shareholders as adjusted for the effect of
dilutive ordinary equivalent shares, if any, by the weighted
average number of ordinary and dilutive ordinary equivalent shares
expressed in ADS outstanding during the period.
|
([6]) EBITDA
represents net income/loss excluding depreciation, amortization,
interest expense and income tax expense and minus interest income.
Adjusted EBITDA represents EBITDA excluding share-based
compensation expenses and fair value change of equity investments
(if any).
|
([7]) All numbers
presented have been rounded to the nearest integer, tenth, or
hundredth, and year over year comparisons are based on figures
before
rounding.
|
([8]) All numbers
represented the financial results from continuing operations,
unless otherwise
stated.
|
([9]) "Others"
Segment primarily represents Capital business units. Results from
UCargo's legacy contracts with external customers are now reported
under "Freight" segment and prior period segment information were
retrospectively revised to conform to current period
presentation.
|
([10]) The total
number of shares outstanding excludes shares reserved for future
issuances upon exercise or vesting of awards granted under the
Company's share incentive plans.
|
([11])
Unallocated expenses are primarily related to corporate
administrative expenses and other miscellaneous items that are not
allocated to individual segments.
|
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SOURCE BEST Inc.