Lanting Pavilion Rally 2019 Q1 Earnings: Net Revenue Of $50 Million 900 Thousand

Cross border e-commerce company NYSE:LITB (LightInTheBox) released its unaudited results for the first quarter of March 31, 2019. According to the financial report, Lanting Pavilion's net revenue in the first quarter was $50 million 900 thousand.

Highlights of the first quarter of 2019:

In the first quarter, Lanting Pavilion's gross profit margin increased from 29.2% in the same period last year to 34.8%.

The net loss in the first quarter was $14 million 100 thousand, compared with a net loss of $7 million 900 thousand in the same period last year. It is noteworthy that the increase in net loss was mainly due to a loss of $5 million 300 thousand in the fair value of the convertible bonds issued by the company for the acquisition of ezbuy in the first quarter of 2019. The adjusted profit margin before depreciation and amortization (EBITDA) was $7 million 900 thousand, compared with $7 million 400 thousand in 2018.

In addition, sales cost accounted for 18.3% of net revenue from 23% in the same period last year.

Financial results for the first quarter of 2019:

In the first quarter of 2019, Lanting Pavilion's net revenue was $50 million 900 thousand, which was 27.4% lower than that of 70 million 100 thousand US dollars in the same period in 2018. Net sales of product sales amounted to $49 million 800 thousand, compared with $66 million in 2018. Services and other net revenues amounted to $1 million 100 thousand, compared with $4 million 100 thousand in 2018. In the first quarter of 2019, the net revenue of services and other industries accounted for 2.2% of total net revenue.

Total orders for product sales in the first quarter were 2 million 600 thousand, compared with 1 million 300 thousand in 2018. The number of customers for product sales was 600 thousand, compared with 1 million in 2018.

Sales of product sales in the first quarter were $14 million 400 thousand in apparel category, which was $19 million 900 thousand in the same period in 2018. Clothing revenue accounted for 28.9% of sales, compared to 30.2% in 2018. In the first quarter of 2019, sales of other categories of products sold amounted to US $35 million 400 thousand.

The cost of revenue in the first quarter of 2019 was $33 million 200 thousand, compared to $49 million 600 thousand in the same period in 2018. The cost of product sales was $32 million 800 thousand, compared with $45 million 900 thousand in the same period in 2018. Services and other costs amounted to $400 thousand, compared with $3 million 700 thousand in 2018.

Gross profit in the first quarter was $17 million 700 thousand, compared with $20 million 500 thousand in the same period in 2018. The gross profit margin in the first quarter was 34.8%, compared with 29.2% in the same period in 2018.

The operating expenses in the first quarter amounted to $26 million 500 thousand, compared with $28 million 600 thousand in the same period in 2018.

The performance cost in the first quarter was $5 million 200 thousand, compared with $4 million 500 thousand in the same period in 2018. In the first quarter, the ratio of performance fees to net revenues was 10.2%, 6.4% in the same period in 2018 and 6.2% in the fourth quarter of 2018.

The first quarter sales cost was $9 million 300 thousand, compared with $16 million 100 thousand in the same period in 2018. The first quarter sales cost accounted for 18.3% of net revenue, 23% in the same period in 2018, and 20.5% in the fourth quarter of 2018.

The first quarter management fee was $12 million, compared to $8 million in the same period in 2018. In the first quarter, management fees accounted for 23.6% of net revenue, 11.4% in the same period in 2018 and 10.8% in the fourth quarter of 2018. The first quarter management fee includes $4 million 200 thousand in research and development expenses, compared with $3 million in the same period in 2018.

The operating loss in the first quarter was $8 million 800 thousand, compared with a loss of $8 million 100 thousand in the same period in 2018.

The net loss in the first quarter was $14 million 100 thousand, compared with a net loss of $7 million 900 thousand in the same period in 2018. It is noteworthy that the increase in net potential losses in Lanting Pavilion was mainly due to the change in the fair value of the convertible bonds issued by the company in December 10, 2018 in the first quarter of 2019 to $5 million 300 thousand.

In the first quarter of 2019, the weighted average of the US depositary shares was 67229085. The net loss of us depositary shares (US depositary shares representing two common stocks) was $0.21 per share, and the net loss of us depositary shares in 2018 was $0.12.

Among them, the adjusted EBITDA was $7 million 900 thousand, compared with $7 million 400 thousand in 2018.

As of March 31, 2019, the company's cash, cash equivalents and restricted funds amounted to $30 million 300 thousand, while the cash, cash equivalents and restricted funds were $39 million 800 thousand as at December 31, 2018.

Ho Jian, chief executive officer of the Lanting Pavilion group, said that the measures taken to reverse the downturn and stabilize business in the previous quarter have continued to achieve good results in the current quarter. Although net revenue fell 27.4% to 50 million 900 thousand US dollars in the quarter, the gross profit margin was basically flat, steady at 34.8%, a significant improvement over 29.2% in the same period last year.

He said that the integration of ezbuy and Lanting Pavilion integration business is creating new synergy. Lanting Pavilion's operational efficiency and consumer repeat purchase rate have been improved. The proportion of sales expenses to net revenue decreased to 18.3% in the current quarter, showing a continuous downward trend. The adjusted EBITDA is US $7 million 900 thousand, which is basically the same as last year. This shows the success of the Lanting Pavilion in reversing its business.

It is understood that, based on the current information and quarterly factors, Lanting Pavilion is expected to net revenue in the second quarter of 2019 from 57 million US dollars to $60 million.