BEIJING, Aug. 30, 2019 /PRNewswire/ -- Fang Holdings Limited (NYSE: SFUN) ("Fang" or "we"), a leading real estate Internet portal in China, today announced its unaudited financial results for the second quarter and the first half year ended June 30, 2019.
Second Quarter 2019 Highlights
First Half 2019 Highlights
"We are turning around and achieved revenue growth after many quarters of decrease," commented Mr. Jian Liu, CEO of Fang. "The main drivers behind this growth are marketing services and leads generation services, which will continue to generate growth into the coming quarters."
Second Quarter 2019 Results
Revenues
Fang reported total revenues of $67.6 million in the second quarter of 2019, an increase of 6.8% from $63.3 million in the corresponding period of 2018, mainly due to the increase in revenues from marketing services.
Revenue from marketing services was $32.5 million in the second quarter of 2019, an increase of 19.3% from $27.2 million in the corresponding period of 2018, driven by Fang's efforts in customer development.
Revenue from listing services was $19.2 million in the second quarter of 2019, a decrease of 26.0% from $26.0 million in the corresponding period of 2018, mainly due to the decrease of paying members in listing services.
Revenue from leads generation services was $10.8 million in the second quarter of 2019, an increase of 290.2% from $2.8 million in the corresponding period of 2018, driven by the increased effectiveness of the service and customer development.
Revenue from financial services was $2.6 million in the second quarter of 2019, a decrease of 3.2% from $2.7 million in the corresponding period of 2018.
Cost of Revenue
Cost of revenue was $8.3 million in the second quarter of 2019, compared to $8.4 million in the corresponding period of 2018.
Operating Expenses
Operating expenses were $30.3 million in the second quarter of 2019, a decrease of 53.0% from $64.5 million in the corresponding period of 2018, mainly due to the decrease in bad debt and staff costs.
Operating Income/Loss from Continuing Operations
Operating income from continuing operations was $29.0 million in the second quarter of 2019, compared to operating loss from continuing operations of $9.6 million in the corresponding period of 2018, mainly due to the decrease in operating expenses.
Change in Fair Value of Securities
Change in fair value of securities for the second quarter of 2019 was a loss of $48.5 million, compared to a loss of $82.9 million in the corresponding period of 2018, mainly due to the fluctuation in market price of investments in equity securities.
Income Tax Benefits
Income tax benefits were $20.6 million in the second quarter of 2019, a decrease of 27.2% compared to income tax benefits of $28.3 million in the corresponding period of 2018, primarily due to the effect of change in fair value of equity securities and the reversal of previously recorded ASC 740 (FIN 48) income taxes and interest.
Net Income/Loss
Net income was $4.2 million in the second quarter of 2019, compared to net loss of $53.5 million in the corresponding period of 2018.
Cash
As of June 30, 2019, Fang had cash and cash equivalents, restricted cash (current and non-current) and short-term investments of $500.6 million, compared to $439.7 million as of December 31, 2018.
First half year 2019 Results
Revenues
Fang reported total revenues of $102.6 million in the first half year of 2019, a decrease of 8.7% from $112.3 million in the corresponding period of 2018.
Revenue from marketing services was $45.7 million in the first half year of 2019, an increase of 5.3% from $43.4 million in the corresponding period of 2018, driven by Fang's efforts in customer development.
Revenue from listing services was $31.4 million in the first half year of 2019, a decrease of 29.7% from $44.6 million in the corresponding period of 2018, mainly due to the decrease of paying members in listing services.
Revenue from leads generation services was $14.8 million in the second quarter of 2019, an increase of 281.2% from $3.9 million in the corresponding period of 2018, driven by the increased effectiveness of the service and customer development.
Revenue from financial services was $6.1 million in the first half year of 2019, a decrease of 21.1% from $7.8 million in the corresponding period of 2018.
Cost of Revenue
Cost of revenue was $16.7 million in the first half year of 2019, a decrease of 34.2% from $25.4 million in the corresponding period of 2018, primarily due to cost savings from optimizing Fang's core business.
Operating Expenses
Operating expenses were $68.6 million in the first half year of 2019, a decrease of 36.0% from $107.2 million in the corresponding period of 2018, mainly due to the decrease in bad debt and staff costs.
Operating Income/Loss from Continuing Operations
Operating income from continuing operations was $17.2 million in the first half year of 2019, compared to an operating loss from continuing operations of $20.2 million in the corresponding period of 2018, mainly due to the decrease in operating expenses.
Change in Fair Value of Securities
Change in fair value of securities for the first half year of 2019 was a loss of $16.5 million, compared to a loss of $125.2 million in the corresponding period of 2018, mainly due to the fluctuation in market price of investments in equity securities.
Income Tax Benefits
Income tax benefits were $9.5 million in the first half year of 2019, a decrease of 71.7% from $33.5 million in the corresponding period of 2018, primarily due to the effect of change in fair value of equity securities and the reversal of previously recorded ASC 740 (FIN 48) income taxes and interest.
Net Income/Loss
Net income was $17.6 million in the first half year of 2019, compared to a net loss of $98.4 million in the corresponding period of 2018.
Business Outlook
Based on current operations and market conditions, Fang's management remains confident that net income is expected to be positive for the fiscal year ending December 31, 2019. This estimate represents management's current and preliminary view, which is subject to change.
Conference Call Information
Fang's management team will host a conference call on the same day at 8:00 AM U.S. EST (8:00 PM Beijing/Hong Kong time). The dial-in details for the live conference call are:
International Toll: |
+65 67135090 |
Toll-Free/Local Toll: |
|
United States |
+1 866-519-4004 / +1 845-675-0437 |
Hong Kong |
+852 800-906-601 / +852 3018-6771 |
Mainland China |
+86 800-819-0121 / +86 400-620-8038 |
Passcode: |
SFUN |
A telephone replay of the call will be available after the conclusion of the conference call from 11:00 AM ET on August 30, 2019 through 9:59 AM ET September 07, 2019. The dial-in details for the telephone replay are:
International Toll: |
+61 2-8199-0299 |
Toll-Free/Local Toll: |
|
United States |
+1 855-452-5696 / +1 646-254-3697 |
Hong Kong |
+852 800-963-117 / +852 3051-2780 |
Mainland China |
+86 400-602-2065 / +86 800-870-0205 |
Conference ID: |
3968246 |
A live and archived webcast of the conference call will be available on Fang's website at http://ir.fang.com.
About Fang
Fang operates a leading real estate Internet portal in China in terms of the number of page views and visitors to its websites. Through its websites, Fang provides primarily marketing, listing, leads generation and financial services for China's fast-growing real estate and home furnishing and improvement sectors. Its user-friendly websites support active online communities and networks of users seeking information on, and value-added services for, the real estate and home furnishing and improvement sectors in China. Fang currently maintains approximately 65 offices to focus on local market needs and its website and database contains real estate related content covering 658 cities in China. For more information about Fang, please visit http://ir.fang.com.
Safe Harbor Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking 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," "is expected to," "anticipates," "aim," "future," "intends," "plans," "believes," "are likely to," "estimates," "may," "should" and similar expressions, and include, without limitation, statements regarding Fang's future financial performance, revenue guidance, growth and growth rates, market position and continued business transformation. Such statements are based upon management's current expectations and current market and operating conditions, and relate to events that involve known or unknown risks, uncertainties and other factors, all of which are difficult to predict and many of which are beyond Fang's control, which may cause its actual results, performance or achievements to differ materially from those in the forward-looking statements. Potential risks and uncertainties include, without limitation, the impact of Fang's transformation back to a technology-driven Internet platform and the impact of current and future government policies affecting China's real estate market. Further information regarding these and other risks, uncertainties or factors is included in Fang's filings with the U.S. Securities and Exchange Commission. Fang does not undertake any obligation to update any forward-looking statement as a result of new information, future events or otherwise, except as required under law.
Fang Holdings Limited |
|||
Unaudited Condensed Consolidated Balance Sheets[I] |
|||
(in thousands of U.S. dollars, except share data and per share data) |
|||
ASSETS |
June 30, |
December 31, |
|
2019 |
2018 |
||
Current assets: |
|||
Cash and cash equivalents |
232,119 |
171,183 |
|
Restricted cash, current |
245,064 |
245,474 |
|
Short-term investments |
17,387 |
16,043 |
|
Accounts receivable, net |
67,481 |
58,687 |
|
Funds receivable |
6,576 |
5,474 |
|
Prepayment and other current assets |
29,265 |
27,894 |
|
Commitment deposits |
191 |
191 |
|
Loans receivable, current |
66,264 |
117,602 |
|
Amounts due from related parties |
699 |
- |
|
Current assets of discontinued operations |
- |
26,289 |
|
Total current assets |
665,046 |
668,837 |
|
Non-current assets: |
|||
Property and equipment, net |
716,359 |
727,739 |
|
Land use rights |
32,670 |
33,153 |
|
Loans receivable, non-current |
1,762 |
6,249 |
|
Deferred tax assets |
2,023 |
2,202 |
|
Deposits for non-current assets |
409 |
902 |
|
Restricted cash, non-current portion |
6,002 |
6,990 |
|
Long-term investments |
358,384 |
373,233 |
|
Other non-current assets |
10,404 |
4,558 |
|
Non-current assets of discontinued operations |
- |
573 |
|
Total non-current assets |
1,128,013 |
1,155,599 |
|
Total assets |
1,793,059 |
1,824,436 |
|
LIABILITIES AND SHAREHOLDERS' EQUITY |
|||
Current liabilities: |
|||
Short-term loans |
293,089 |
297,811 |
|
Deferred revenue |
141,252 |
142,473 |
|
Accrued expenses and other liabilities |
111,377 |
118,925 |
|
Customers' refundable fees |
3,529 |
3,976 |
|
Income tax payable |
8,757 |
2,383 |
|
Amounts due to related parties |
135 |
19 |
|
Current liabilities of discontinued operations |
- |
35,326 |
|
Total current liabilities |
558,139 |
600,913 |
|
Non-current liabilities: |
|||
Long-term loans |
119,503 |
123,215 |
|
Convertible senior notes |
253,498 |
254,435 |
|
Deferred tax liabilities |
97,305 |
97,578 |
|
Other non-current liabilities |
133,835 |
150,837 |
|
Non-current liabilities of discontinued operations |
- |
2,258 |
|
Total non-current liabilities |
604,141 |
628,323 |
|
Total Liabilities |
1,162,280 |
1,229,236 |
|
Equity: |
|||
Class A ordinary shares, par value Hong Kong Dollar ("HK$") 1 per share, 71,775,686; outstanding shares as of December 31, 2018 and June 30, 2019: |
9,244 |
9,286 |
|
Class B ordinary shares, par value HK$1 per share, 600,000,000 shares |
3,124 |
3,124 |
|
Treasury stock |
(129,801) |
(136,615) |
|
Additional paid-in capital |
521,494 |
517,802 |
|
Accumulated other comprehensive loss |
(82,351) |
(75,837) |
|
Retained earnings |
308,375 |
276,746 |
|
Total Fang Holdings Limited shareholders' equity |
630,085 |
594,506 |
|
Non controlling interests |
694 |
694 |
|
Total equity |
630,779 |
595,200 |
|
TOTAL LIABILITIES AND EQUITY |
1,793,059 |
1,824,436 |
|
Unaudited Condensed Consolidated Statements of Comprehensive Income[1] |
||||||||
(in thousands of U.S. dollars, except share data and per share data) |
||||||||
Three months ended |
Six months ended |
|||||||
June 30, |
June 30, |
June 30, |
June 30, |
|||||
2019 |
2018 |
2019 |
2018 |
|||||
Revenues: |
||||||||
Marketing services |
32,465 |
27,202 |
45,728 |
43,417 |
||||
Listing services |
19,212 |
25,962 |
31,371 |
44,617 |
||||
Leads generation services |
10,801 |
2,768 |
14,787 |
3,879 |
||||
Value-added services |
1,666 |
1,390 |
2,668 |
2,277 |
||||
Financial services |
2,640 |
2,726 |
6,139 |
7,779 |
||||
E-commerce services |
779 |
3,211 |
1,860 |
10,380 |
||||
Total revenues |
67,563 |
63,259 |
102,553 |
112,349 |
||||
Cost of revenues: |
||||||||
Cost of services |
(8,254) |
(8,365) |
(16,692) |
(25,362) |
||||
Total cost of revenues |
(8,254) |
(8,365) |
(16,692) |
(25,362) |
||||
Gross profit |
59,309 |
54,894 |
85,861 |
86,987 |
||||
Operating expenses and income: |
||||||||
Selling expenses |
(16,137) |
(14,341) |
(32,456) |
(27,766) |
||||
General and administrative expenses |
(15,659) |
(50,716) |
(38,052) |
(80,196) |
||||
Other income |
1,509 |
593 |
1,896 |
752 |
||||
Operating income /(loss) from continuing |
29,022 |
(9,570) |
17,249 |
(20,223) |
||||
Foreign exchange loss |
(371) |
(185) |
(633) |
(187) |
||||
Interest income |
1,632 |
3,334 |
3,321 |
5,939 |
||||
Interest expense |
(5,696) |
(4,815) |
(11,741) |
(10,300) |
||||
Investment income, net |
338 |
4,785 |
343 |
4,887 |
||||
Realized gain on sale of available-for-sale |
573 |
669 |
871 |
361 |
||||
Change in fair value of securities |
(48,514) |
(82,917) |
(16,464) |
(125,161) |
||||
Government grants |
464 |
399 |
699 |
614 |
||||
Other non-operating loss |
- |
(95) |
- |
(465) |
||||
Loss before income taxes and noncontrolling |
(22,552) |
(88,395) |
(6,355) |
(144,535) |
||||
Income tax benefits |
||||||||
Income tax benefits |
20,609 |
28,302 |
9,490 |
33,513 |
||||
Net (loss) income from continuing operations, |
(1,943) |
(60,093) |
3,135 |
(111,022) |
||||
Income from discontinued operations, net of income |
6,123 |
6,553 |
14,446 |
12,607 |
||||
Net income (loss) |
4,180 |
(53,540) |
17,581 |
(98,415) |
||||
Net loss attributable to noncontrolling interests |
- |
- |
- |
- |
||||
Net income (loss) attributable to Fang Holdings |
4,180 |
(53,540) |
17,581 |
(98,415) |
||||
Earnings /(loss) per share for Class A and Class B ordinary shares and per ADS: |
||||||||
Basic |
0.05 |
(0.60) |
0.20 |
(1.11) |
||||
Diluted |
0.05 |
(0.60) |
0.19 |
(1.11) |
||||
Earnings /(loss) from continuing operations per share for Class A and Class B ordinary shares and per ADS: |
||||||||
Basic |
(0.02) |
(0.68) |
0.04 |
(1.25) |
||||
Diluted |
(0.02) |
(0.68) |
0.03 |
(1.25) |
||||
Earnings from discontinued operations per share for Class A and Class B ordinary shares and per ADS: |
||||||||
Basic |
0.07 |
0.08 |
0.16 |
0.14 |
||||
Diluted |
0.07 |
0.08 |
0.16 |
0.14 |
||||
[i] Impact of the Separation of China Index Holdings Ltd (NASDAQ: CIH) ("CIH") on the Company's Financial Statements: The separation of CIH represents a strategic shift of Fang and has a major effect on Fang's results of operations, the business operated by CIH has been reclassified as discontinued operations. For the periods presented in this press release, the assets and liabilities of the discontinued operations are presented separately on the consolidated balance sheets, and the results of the discontinued operations, less applicable income taxes, are reported as a separate component of income, which is income from discontinued operations, on the consolidated statements of comprehensive income (loss). |
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