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Leju Reports Third Quarter 2019 Results and Issues Notice of Annual General Meeting

2019-11-25 18:38 5610

BEIJING, Nov. 25, 2019 /PRNewswire/ -- Leju Holdings Limited ("Leju" or the "Company") (NYSE: LEJU), a leading e-commerce and online media platform for real estate and home furnishing industries in China, today announced its unaudited financial results for the fiscal quarter and nine months ended September 30, 2019.

Third Quarter 2019 Financial Highlights

  • Total revenues increased by 39% year-on-year to $185.4 million.
    - Revenues from e-commerce services increased by 58% year-on-year to $153.4 million.
    - Revenues from online advertising services decreased by 13% year-on-year to $31.5 million.
  • Income from operations was $15.8 million, an increase of 40% from $11.3 million for the same quarter of 2018.
  • Non-GAAP[1] income from operations was $19.5 million, an increase of 25% from $15.6 million for the same quarter of 2018.
  • Net income attributable to Leju Holdings Limited shareholders was $11.2 million, or $0.08 per diluted American depositary share ("ADS"), an increase of 63% from $6.8 million, or $0.05 per diluted ADS, for the same quarter of 2018.
  • Non-GAAP net income attributable to Leju Holdings Limited shareholders was $14.1 million, or $0.10 per diluted ADS, an increase of 37% from $10.3 million, or $0.08 per diluted ADS, for the same quarter of 2018.

First Nine Month 2019 Financial Highlights

  • Total revenues increased by 38% year-on-year to $465.8 million.
    - Revenues from e-commerce services increased by 52% year-on-year to $362.6 million.
    - Revenues from online advertising services increased by 4% year-on-year to $101.8 million.
  • Income from operations was $8.7 million, compared to loss from operations of $10.2 million for the same period of 2018.
  • Non-GAAP income from operations was $19.9 million, an increase of 611% from $2.8 million for the same period of 2018.
  • Net income attributable to Leju Holdings Limited shareholders was $7.0 million, or $0.05 per diluted ADS, compared to net loss attributable to Leju Holdings Limited shareholders of $14.9 million, or $0.11 loss per diluted ADS for the same period of 2018.
  • Non-GAAP net income attributable to Leju Holdings Limited shareholders was $15.9 million, or $0.12 per diluted ADS, compared to non-GAAP net loss attributable to Leju Holdings Limited shareholders of $4.4 million, or $0.03 loss per diluted ADS for the same period of 2018.

[1]   Leju uses in this press release the following non-GAAP financial measures: (1) income (loss) from operations, (2) net income (loss), (3) net income (loss) attributable to Leju shareholders, (4) net income (loss) attributable to Leju shareholders per basic ADS, and (5) net income (loss) attributable to Leju shareholders per diluted ADS, each of which excludes share-based compensation expense, amortization of intangible assets resulting from business acquisitions and income tax impact on the share-based compensation expense, amortization of intangible assets resulting from business combinations. See "About Non-GAAP Financial Measures" and "Unaudited Reconciliation of GAAP and Non-GAAP Results" below for more information about the non-GAAP financial measures included in this press release.

"We are pleased that our revenue reached a record high in the third quarter," said Mr. Geoffrey He, Leju's chief executive officer. "Since the second half of this year, increasing demand for marketing services from developers as a result of added pressure to reduce inventories has driven significant growth in our new e-commerce business. Leju's top-down strategy has allowed us to seize market opportunities, expand our customer base and increase the average number of projects under cooperation per customer, all of which provide a solid foundation to grow our project pipeline for the fourth quarter and next year. In addition, in the third quarter, our profit remained stable with continued positive cash inflow generated from operations. In the fourth quarter, Leju will hold our annual gala awards ceremony for China's property industry, which will help to further enhance our media influence and customer relationships. " 

Third Quarter 2019 Results

Total revenues were $185.4 million, an increase of 39% from $133.6 million for the same quarter of 2018, mainly due to an increase in revenues from e-commerce services.

Revenues from e-commerce services were $153.4 million, an increase of 58% from $96.9 million for the same quarter of 2018, primarily due to an increase in the number of discount coupons redeemed, partially offset by a decrease in the average price per discount coupon redeemed.

Revenues from online advertising services were $31.5 million, a decrease of 13% from $36.0 million for the same quarter of 2018, primarily due to a decrease in property developers' demand for online advertising.

Revenues from listing services were $0.5 million, a decrease of 34% from $0.8 million for the same quarter of 2018, primarily due to a decrease in secondary real estate brokers' demand.

Cost of revenues was $13.2 million, a decrease of 22% from $16.9 million for the same quarter of 2018, primarily due to decreased cost of advertising resources purchased from media platforms related to the Company's online advertising business.

Selling, general and administrative expenses were $157.0 million, an increase of 48% from $106.2 million for the same quarter of 2018, primarily due to increased marketing expenses related to the Company's e-commerce business.

Income from operations was $15.8 million, an increase of 40% from $11.3 million for the same quarter of 2018. Non-GAAP income from operations was $19.5 million, an increase of 25% from $15.6 million for the same quarter of 2018.

Net income was $11.3 million, an increase of 54% from $7.3 million for the same quarter of 2018. Non-GAAP net income was $14.2 million, an increase of 32% from $10.8 million for the same quarter of 2018.

Net income attributable to Leju Holdings Limited shareholders was $11.2 million, or $0.08 per diluted ADS, an increase of 63% from $6.8 million, or $0.05 per diluted ADS, for the same quarter of 2018. Non-GAAP net income attributable to Leju Holdings Limited shareholders was $14.1 million, or $0.10 per diluted ADS, an increase of 37% from $10.3 million, or $0.08 per diluted ADS, for the same quarter of 2018.

First Nine Month 2019 Results

Total revenues were $465.8 million, an increase of 38% from $337.8 million for the same period of 2018, mainly due to an increase in revenues from e-commerce services.

Revenues from e-commerce services were $362.6 million, an increase of 52% from $237.9 million for the same period of 2018, primarily due to an increase in the number of discount coupons redeemed, partially offset by a decrease in the average price per discount coupon redeemed.

Revenues from online advertising services were $101.8 million, an increase of 4% from $97.5 million for the same period of 2018, primarily due to an increase in property developers' demand for online advertising in the first half of 2019.

Revenues from listing services were $1.4 million, a decrease of 44% from $2.4 million for the same period of 2018, primarily due to a decrease in secondary real estate brokers' demand.

Cost of revenues was $55.1 million, an increase of 2% from $54.0 million for the same period of 2018, primarily due to increased cost of advertising resources purchased from media platforms related to the Company's online advertising business in the first half of 2019.

Selling, general and administrative expenses were $403.0 million, an increase of 36% from $296.1 million for the same period of 2018, primarily due to increased marketing expenses related to the Company's e-commerce business.

Income from operations was $8.7 million, compared to loss from operations of $10.2 million for the same period of 2018. Non-GAAP income from operations was $19.9 million, an increase of 611% from $2.8 million for the same period of 2018.

Net income was $7.4 million, compared to net loss of $15.0 million for the same period of 2018. Non-GAAP net income was $16.2 million, compared to non-GAAP net loss of $4.4 million for the same period of 2018.

Net income attributable to Leju Holdings Limited shareholders was $7.0 million, or $0.05 per diluted ADS, compared to net loss attributable to Leju Holdings Limited shareholders of $14.9 million, or $0.11 loss per diluted ADS for the same period of 2018. Non-GAAP net income attributable to Leju Holdings Limited shareholders was $15.9 million, or $0.12 per diluted ADS, compared to non-GAAP net loss attributable to Leju Holdings Limited shareholders of $4.4 million, or $0.03 loss per diluted ADS for the same period of 2018.

Cash Flow

As of September 30, 2019, the Company's cash and cash equivalents balance was $171.0 million.

Third quarter 2019 net cash provided by operating activities was $10.9 million, primarily comprised of non-GAAP net income of $14.2 million, an increase in accrued marketing and advertising expenses and other current liabilities of $21.1 million, an increase in advance from customer of $6.0 million, and an increase in income tax payable and other tax payable of 4.7 million, partially offset by an increase in accounts receivable and contract assets of $18.4 million, and an increase in customer deposits of $18.2 million.

Business Outlook

The Company estimates that its total revenues for the fourth quarter of 2019 will be approximately $200 million to $210 million, which would represent an increase of approximately 61% to 69% from $124.2 million in the same quarter in 2018. This forecast reflects the Company's current and preliminary view, which is subject to change.

Leju to Hold Annual General Meeting on December 20, 2019

Leju announced that it will hold its annual general meeting of shareholders (the "AGM") at Room 1120, 11/F, Yinli Building, No. 383 Guangyan Road, Shanghai, the People's Republic of China on December 20, 2019 at 10:00AM (local time). No proposal will be submitted to shareholders for approval at the AGM. Instead, the AGM will serve as an open forum for shareholders and holders of the Company's ADSs to discuss Company affairs with management.

Holders of record of the Company's ordinary shares at the close of business on December 2, 2019 (Eastern Daylight Time) are entitled to receive notice of and attend the annual general meeting or any adjournment or postponement thereof. Holders of the Company's ADSs are welcome to attend the AGM in person.

The notice of the annual general meeting is available on the Company's website at http://ir.leju.com.

Conference Call Information

Leju's management will host an earnings conference call on November 25, 2019 at 7 a.m. U.S. Eastern Time (8 p.m. Beijing/Hong Kong time).

Dial-in details for the earnings conference call are as follows:

U.S./International:

+1-845-675-0437

Hong Kong:

+852-3018-6771

Mainland China:  

400-620-8038

Please dial in 10 minutes before the call is scheduled to begin and provide the passcode to join the call. The passcode is "Leju earnings call".

A replay of the conference call may be accessed by phone at the following number until December 3, 2019:

U.S./International:

+1-855-452-5696

Hong Kong:  

800-963-117

Mainland China:  

400-632-2162

Passcode: 

8377206

Additionally, a live and archived webcast will be available at http://ir.leju.com.

About Leju

Leju Holdings Limited ("Leju") (NYSE: LEJU) is a leading e-commerce and online media platform for real estate and home furnishing industries in China, offering real estate e-commerce, online advertising and online listing services. Leju's integrated online platform comprises various mobile applications along with local websites covering more than 380 cities, enhanced by complementary offline services to facilitate residential property transactions. In addition to the Company's own websites, Leju operates the real estate and home furnishing websites of SINA Corporation, and maintains a strategic partnership with Tencent Holdings Limited. For more information about Leju, please visit http://ir.leju.com.

Safe Harbor: Forward-Looking Statements

This announcement contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in 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," "target," "going forward," "outlook" and similar statements. Leju may also make written or oral forward-looking statements in its reports filed or furnished with the U.S. Securities and Exchange Commission, 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 Leju's beliefs and expectations, are forward-looking statements that involve inherent risks and uncertainties. A number of important factors could cause actual results to differ materially from those contained, either expressly or impliedly, in any of the forward-looking statements. Such factors include, but are not limited to, fluctuations in China's real estate market; the highly regulated nature of, and government measures affecting, the real estate and internet industries in China; Leju's ability to compete successfully against current and future competitors; its ability to continue to develop and expand its content, service offerings and features, and to develop or incorporate the technologies that support them; its limited operating history and lack of experience as a stand-alone public company, given its carve-out from E-House and prior reliance on E-House for various corporate services; its reliance on SINA and others with which it has developed, or may develop in the future, strategic partnerships; substantial revenue contribution from a limited number of real estate markets; complexities resulting from its ongoing relationships with E-House, due to E-House's status as a principal shareholder of Leju; and relevant government policies and regulations relating to the corporate structure, business and industry of Leju. Further information regarding these and other risks, uncertainties or factors is included in the Company's filings with the U.S. Securities and Exchange Commission. All information provided in this press release is current as of the date of the press release, and the Company 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 applicable law.

About Non-GAAP Financial Measures

To supplement Leju's consolidated financial results presented in accordance with United States Generally Accepted Accounting Principles ("GAAP"), Leju uses in this press release the following non-GAAP financial measures: (1) income (loss) from operations, (2) net income (loss), (3) net income (loss) attributable to Leju shareholders, (4) net income (loss) attributable to Leju shareholders per basic ADS, and (5) net income (loss) attributable to Leju shareholders per diluted ADS, each of which excludes share-based compensation expense, amortization of intangible assets resulting from business acquisitions, and income tax impact on the share-based compensation expense and amortization of intangible assets resulting from business combinations. 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 GAAP. For more information on these non-GAAP financial measures, please see the table captioned "Unaudited Reconciliation of GAAP and Non-GAAP Results" set forth at the end of this press release.

Leju believes that these non-GAAP financial measures provide meaningful supplemental information to investors regarding its operating performance by excluding share-based compensation expense and amortization of intangible assets resulting from business acquisitions, which may not be indicative of Leju's operating performance. These non-GAAP financial measures also facilitate management's internal comparisons to Leju's historical performance and assist its financial and operational decision making. A limitation of using these non-GAAP financial measures is that share-based compensation expense and amortization of intangible assets resulting from business acquisitions may continue to exist in Leju's business for the foreseeable future. Management compensates for these limitations by providing specific information regarding the GAAP amounts excluded from each non-GAAP measure. The accompanying tables provide more details on the reconciliation between non-GAAP financial measures and their most comparable GAAP financial measures.

For investor and media inquiries please contact:

Ms. Christina Wu
Leju Holdings Limited
Phone: +86 (10) 5895-1062
E-mail: ir@leju.com

Philip Lisio
Foote Group
Phone: +86 135-0116-6560
E-mail: phil@thefootegroup.com

 

 

 

LEJU HOLDINGS LIMITED

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands of U.S. dollars)








December 31,


September 30,



2018


2019

ASSETS









Current assets









Cash and cash equivalents



147,263




171,014


Accounts receivable, net



102,697




134,034


Contract assets



2,137




8,400


Marketable securities



2,467




3,414


Prepaid expenses and other current assets



8,621




7,100


Customer deposits



10,672




27,610


Amounts due from related parties



6,695




9,483


Total current assets



280,552




361,055


Property and equipment, net



14,058




17,968


Intangible assets, net



57,401




48,503


Right-of-use assets[2]






27,624


Investment in affiliates



63




51


Deferred tax assets



62,356




60,507


Other non-current assets



2,297




2,051


Total assets



416,727




517,759











LIABILITIES AND EQUITY









Current liabilities









Accounts payable



803




1,715


Accrued payroll and welfare expenses



30,628




31,943


Income tax payable



58,030




58,329


Other tax payable



12,675




18,000


Amounts due to related parties



3,477




11,399


Advance from customers



26,873




40,710


Lease liabilities, current[2]






5,238


Customer deposit payable






7,069


Accrued marketing and advertising expenses



14,896




29,861


Other current liabilities



12,999




31,465


Total current liabilities



160,381




235,729


Lease liabilities, non-current[2]






22,725


Deferred tax liabilities



14,780




14,342


Total liabilities



175,161




272,796


Shareholders' Equity









Ordinary shares ($0.001 par value): 1,000,000,000 shares
 authorized, 135,763,962 and 135,770,628 shares issued and
 outstanding, as of December 31, 2018 and September 30,
 2019, respectively



136




136


Additional paid-in capital



792,626




794,344


Accumulated deficit



(528,825)




(521,804)


Accumulated other comprehensive loss



(19,848)




(25,629)


Total Leju Holdings Limited shareholders' equity



244,089




247,047


Non-controlling interests



(2,523)




(2,084)


Total equity



241,566




244,963


TOTAL LIABILITIES AND EQUITY



416,727




517,759




[2]  In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which requires lessees to recognize a
right-of-use asset and lease liability on their balance sheet for all leases with a term of more than 12 months. The Group
adopted this ASU on January 1, 2019 using the modified retrospective approach and the financial statements for the
comparative period has not been restated.  

 

 

 

LEJU HOLDINGS LIMITED

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands of U.S. dollars, except share data and per share data)




Three months ended


Nine months ended



September 30,


September 30,



2018


2019


2018


2019


















Revenues

















E-commerce



96,853




153,428




237,894




362,642


Online advertising services



35,968




31,466




97,459




101,798


Listing services



767




505




2,434




1,357


Total revenues



133,588




185,399




337,787




465,797


Cost of revenues



(16,935)




(13,237)




(54,015)




(55,068)


Selling, general and administrative expenses



(106,195)




(156,977)




(296,122)




(402,994)


Other operating income



850




590




2,158




958


Income (loss) from operations



11,308




15,775




(10,192)




8,693


Interest income



286




315




845




900


Interest expenses






(858)







(858)


Other income (loss), net



(3,897)




(191)




(6,269)




1,102


Income (loss) before taxes and loss from equity
     in affiliates



7,697




15,041




(15,616)




9,837


Income tax benefits/(expenses)



(361)




(3,776)




732




(2,469)


Income (loss) before loss from equity in
affiliates



7,336




11,265




(14,884)




7,368


Income (loss) from equity in affiliates



(19)




15




(70)




(11)


Net income (loss)



7,317




11,280




(14,954)




7,357


Less: net income (loss) attributable to
    non-controlling interests



473




121




(52)




337


Income (loss) attributable to Leju Holdings
    Limited shareholders



6,844




11,159




(14,902)




7,020



















Earnings (loss) per ADS:

















Basic



0.05




0.08




(0.11)




0.05


Diluted



0.05




0.08




(0.11)




0.05


Shares used in computation of earnings (loss) per
ADS:

















Basic



135,763,962




135,765,158




135,763,962




135,764,361


Diluted



135,763,962




135,769,998




135,763,962




135,767,912




The conversion of functional currency Renminbi ("RMB") amounts into reporting currency USD amounts
is based on the rate of USD1 = RMB7.0729 on September 30, 2019 and USD1 = RMB6.8569 for the nine
months ended September 30, 2019.

 

 

 

LEJU HOLDINGS LIMITED 

UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS)

 (In thousands of U.S. dollars)




Three months ended



Nine months ended



September 30,



September 30,



2018


2019


2018


2019


















Net income (loss)



7,317




11,280




(14,954)




7,357


Other comprehensive loss, net of tax of nil

















Foreign currency translation adjustment



(3,243)




(5,310)




(4,016)




(5,781)



















Comprehensive income (loss)



4,074




5,970




(18,970)




1,576



















Less: Comprehensive income attributable to
    non-controlling interest



551




161




71




377



















Comprehensive income (loss) attributable to Leju
Holdings Limited shareholders



3,523




5,809




(19,041)




1,199



















 

 

 

LEJU HOLDINGS LIMITED

Unaudited Reconciliation of GAAP and Non-GAAP Results

(In thousands of U.S. dollars, except share data and per ADS data)








Three months ended


Nine months ended



September 30,


September 30,



2018


2019


2018


2019















GAAP income (loss) from operations



11,308




15,775



(10,192)



8,693


Share-based compensation expense



1,098




599



3,133



1,770


Amortization of intangible assets resulting from business
    acquisitions



3,204




3,153



9,859



9,459


Non-GAAP income from operations



15,610




19,527



2,800



19,922

















GAAP net income (loss)



7,317




11,280



(14,954)



7,357


Share-based compensation expense



1,098




599



3,133



1,770


Amortization of intangible assets resulting from
   business acquisitions



3,204




3,153



9,859



9,459


Income tax benefit:















   Current











   Deferred[3]



(801)




(788)



(2,465)



(2,364)


Non-GAAP net income (loss)



10,818




14,244



(4,427)



16,222

















Net income (loss) attributable to Leju Holdings Limited shareholder



6,844




11,159



(14,902)



7,020


Share-based compensation expense
    (
net of non-controlling interests)



1,094




599



3,113



1,770


Amortization of intangible assets resulting from business
    acquisitions (net of non-controlling interests)



3,204




3,153



9,859



9,459


Income tax benefit:















   Current











   Deferred



(801)




(788)



(2,465)



(2,364)


Non-GAAP net income (loss) attributable to Leju
    Holdings Limited shareholders



10,341




14,123



(4,395)



15,885

















GAAP net income (loss) per ADS — basic



0.05




0.08



(0.11)



0.05

















GAAP net income (loss) per ADS — diluted



0.05




0.08



(0.11)



0.05

















Non-GAAP net income (loss) per ADS — basic



0.08




0.10



(0.03)



0.12

















Non-GAAP net income (loss) per ADS — diluted



0.08




0.10



(0.03)



0.12

















Shares used in calculating basic GAAP / non-GAAP net
    income (loss) attributable to shareholders per ADS



135,763,962




135,765,158



135,763,962



135,764,361

















Shares used in calculating diluted GAAP / non-GAAP net
    income (loss) attributable to shareholders per ADS



 

135,763,962




135,769,998



135,763,962



135,767,912
































[3]  Amount represents the realization of deferred tax liabilities recognized for the temporary difference between the tax
basis of intangible assets recognized from acquisitions and their reported amounts in the financial statements.
The income tax impact on the share-based compensation expense is nil.

 

 

 

LEJU HOLDINGS LIMITED

SELECTED OPERATING DATA








Three months ended


Nine months ended



September 30,


September 30,



2018


2019


2018


2019


















Operating data for e-commerce services

















Number of discount coupons issued to
    prospective purchasers (number of
    transactions)



31,554




73,259




109,484




167,628


Number of discount coupons redeemed (number of
     transactions)



30,807




51,400




65,494




107,194



















 

 

 

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Source: Leju Holdings Limited
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