BEIJING, June 17, 2021 /PRNewswire/ -- Waterdrop Inc. ("Waterdrop", the "Company" or "we") (NYSE: WDH), a leading technology platform dedicated to insurance and healthcare service with a positive social impact, today announced its unaudited financial results for the first quarter ended March 31, 2021.
Financial and Operational Highlights for the First Quarter of 2021
Mr. Peng Shen, Founder, Chairman and Chief Executive Officer of Waterdrop, commented, "We are pleased to report strong financial and operational growth for the first quarter of 2021 in our first earnings release as a public company. Since our inception in 2016, we have benefited from robust industry development and achieved above-industry growth, and our unique business model has allowed us to become a leading integrated technology platform for insurance and healthcare service in China. Our business model, strong data insights, and technical capabilities have contributed to improving the overall efficiencies of the broader industry, while also empowering our insurance carrier partners. Moving forward, we are going to continue playing a positive role in advancing the diversified medical payment system in China and partake in the rapid growth of the massive Chinese insurance and healthcare market."
Mr. Guang Yang, Co-founder, Director and General Manager of Insurance Marketplace, commented, "On the product side, we continued to develop customized products through deeper collaborations with our partner insurance companies. Among all products we offer to customers and by FYP contribution, over 90% are customized and co-designed by us and insurance carriers. In light of the introduction of the new regulatory definition of critical illness, we shifted our product offerings to adapt to the new definition and requirements to better cater to customer needs, and ensure our sustainable growth. In addition, we consistently diversify our customer acquisition channels, and the contribution from natural traffic and repeat purchases as a percentage of total FYP continued its upward trend."
Mr. Kangping Shi, Chief Financial Officer of Waterdrop, added, "We had a solid first quarter starting the year with both FYP and net operating revenues up 42.7% and 35.1%, respectively, from the same period of last year. The increase in operating costs and expenses were mainly attributable to expenses related with the cessation of mutual aid business. For 2021, we expect our FYP and top line to grow rapidly, and we will continue to improve our unit economics performance by optimizing our customer acquisition strategy."
Financial Results for the First Quarter of 2021
Operating revenue, net
Net operating revenue for the first quarter of 2021 increased by 35.1% to RMB883.4 million (US$134.8 million) from RMB653.8 million for the same period of 2020, which was primarily due to the growth of insurance brokerage income and technical service income.
Operating costs and expenses
Operating costs and expenses increased by RMB579.1 million, or 75.7%, to RMB1,343.9 million (US$205.1 million) for the first quarter of 2021 from RMB764.9 million for the same period of 2020.
Operating loss for the first quarter of 2021 was RMB460.6 million (US$70.3 million), compared with operating loss of RMB111.1 million for the same period of 2020.
Interest income for the first quarter of 2021 was RMB13.2 million (US$2.0 million), compared with RMB5.3 million for the same period of 2020. The increase was primarily due to the increase in cash balance as a result of the receipt of proceeds from private equity financings and interest income from short-term investment. The Company does not generate interest income from the crowdfunding business.
Income tax benefit for the first quarter of 2021 was RMB74.3 million (US$11.3 million), compared with income tax expense of RMB21.8 million for the same period of 2020.
Net loss attributable to Waterdrop for the first quarter of 2021 was RMB370.2 million (US$56.5 million), compared with net loss of RMB120.7 million for the same period of 2020.
Adjusted net loss attributable to Waterdrop for the first quarter of 2021 was RMB203.1 million (US$31.0 million), compared with RMB106.5 million for the same period of 2020. Adjusted net margin was negative 23.0% for the first quarter of 2021, compared with negative 16.3% for the first quarter of 2020.
Cash and cash equivalents and restricted cash
As of March 31, 2021, the Company had combined cash and cash equivalents and restricted cash of RMB1,705.4 million (US$260.3 million), as compared with RMB1,323.3 million as of December 31, 2020.
Business Outlook
The Company expects the FYP generated through Waterdrop Insurance Marketplace to grow more than 50% year-over-year for the second quarter of 2021. This forecast is based on the current market conditions and reflects the Company's preliminary view and estimates, which are all subject to changes.
Exchange Rate
This announcement contains translations of certain RMB amounts into U.S. dollars ("USD") at specified rates solely for the convenience of the reader. Unless otherwise stated, all translations from RMB to USD were made at the rate of RMB6.5518 to US$1.00, the noon buying rate in effect on March 31, 2021 in the H.10 statistical release of the Federal Reserve Board. The Company makes no representation that the RMB or USD amounts referred could be converted into USD or RMB, as the case may be, at any particular rate or at all. For analytical presentation, all percentages are calculated using the numbers presented in the financial statements contained in this earnings release.
Non-GAAP Financial Measures
The Company use non-GAAP financial measures, such as adjusted net operating revenue and adjusted net loss, in evaluating the Company's operating results and for financial and operational decision-making purposes. Adjusted net operating revenue represents net operating revenue excluding management fee income from mutual aid business. Adjusted net loss represents net loss excluding share-based compensation expense, impact of terminating the mutual aid plan, foreign currency exchange gain or losses, and share of results of equity method investee. Such adjustments have no impact on income tax.
These non-GAAP financial measures should not be considered in isolation or construed as an alternative to net loss or any other measure of performance or as an indicator of our operating performance. Investors are encouraged to review the Company's historical non-GAAP financial measures to the most directly comparable GAAP measures. Adjusted net operating revenue and adjusted net loss presented here may not be comparable to similarly titled measures presented by other companies. Other companies may calculate similarly titled measures differently, limiting their usefulness as comparative measures to our data. The Company encourage investors and others to review its financial information in its entirety and not rely on a single financial measure.
Safe Harbor Statement
This press release contains statements that may constitute "forward-looking" statements pursuant to 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," "aims," "future," "intends," "plans," "believes," "estimates," "likely to" and similar statements. Among other things, quotations in this announcement, contain forward-looking statements. Waterdrop 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 Waterdrop's beliefs, plans 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: Waterdrop's mission, goals and strategies; Waterdrop's future business development, financial condition and results of operations; the expected growth of the insurance and online healthcare industry in China; Waterdrop's expectations regarding demand for and market acceptance of our products and services; Waterdrop's expectations regarding its relationships with consumers, insurance carriers and other partners; competition in the industry and relevant government policies and regulations relating to insurance and online healthcare industry. Further information regarding these and other risks is included in Waterdrop's filings with the SEC. All information provided in this press release is as of the date of this press release, and Waterdrop does not undertake any obligation to update any forward-looking statement, except as required under applicable law.
Conference Call Information
Waterdrop's management team will hold a conference call on June 17, 2021 at 8:00 AM U.S. Eastern Time (8:00 PM Beijing/Hong Kong Time on the same day) to discuss the financial results. Dial-in details for the earnings conference call are as follows:
United States: |
1-888-317-6003 |
Hong Kong: |
852-580-81995 |
Mainland China: |
4001-206115 |
International: |
1-412-317-6061 |
Elite Entry Number: |
8371404 # |
Please dial in 15 minutes before the call is scheduled to begin and provide the Elite Entry Number to join the call.
A telephone replay will be accessible through June 24, 2021 by dialing the following numbers:
United States: |
1- 877-344-7529 |
International: |
1-412-317-0088 |
Access Code: |
10157332 # |
A live and archived webcast of the conference call will also be available at the Company's investor relations website at http://ir.waterdrop-inc.com/.
About Waterdrop Inc.
Waterdrop Inc. (NYSE: WDH) is a leading technology platform dedicated to insurance and healthcare service with a positive social impact. Founded in 2016, with the comprehensive coverage of Waterdrop Insurance Marketplace and Medical Crowdfunding, Waterdrop aims to bring insurance and healthcare service to billions through technology. For more information, please visit www.waterdrop-inc.com.
For investor inquiries, please contact
Waterdrop Inc.
Xiaojiao Cui
IR@shuidi-inc.com
Christensen
In China
Mr. Eric Yuan
Phone: +86-1380-111-0739
E-mail: Eyuan@christensenir.com
In US
Ms. Linda Bergkamp
Phone: +1-480-614-3004
Email: lbergkamp@christensenir.com
WATERDROP INC. |
|||
Unaudited Condensed Consolidated Balance Sheets |
|||
(All amounts in thousands, unless otherwise noted) |
|||
As of |
|||
December 31, 2020 |
March 31, 2021 |
||
RMB |
RMB |
USD |
|
Assets |
|||
Current assets |
|||
Cash and cash equivalents |
1,061,962 |
1,107,394 |
169,021 |
Restricted cash |
261,387 |
598,027 |
91,277 |
Short-term investments |
1,193,160 |
519,661 |
79,316 |
Accounts receivable |
539,791 |
645,463 |
98,517 |
Current contract assets |
824,544 |
820,264 |
125,197 |
Amount due from related parties |
813 |
439 |
67 |
Prepaid expense and other assets |
651,080 |
499,674 |
76,263 |
Total current assets |
4,532,737 |
4,190,922 |
639,658 |
Non-current assets |
|||
Non-current contract assets |
24,006 |
24,215 |
3,696 |
Property, equipment and software, net |
28,724 |
36,873 |
5,628 |
Intangible assets, net |
53,034 |
56,806 |
8,670 |
Long-term investments |
2,741 |
2,749 |
420 |
Right of use assets, net |
60,694 |
57,001 |
8,700 |
Goodwill |
3,119 |
3,119 |
476 |
Total non-current assets |
172,318 |
180,763 |
27,590 |
Total assets |
4,705,055 |
4,371,685 |
667,248 |
Liabilities, Mezzanine Equity and Shareholders' Deficit |
|||
Current liabilities |
|||
Amount due to related parties |
9,789 |
12,295 |
1,877 |
Insurance premium payables |
607,326 |
602,608 |
91,976 |
Deferred revenue |
22,017 |
11,374 |
1,736 |
Accrued expenses and other current liabilities |
595,606 |
702,597 |
107,237 |
Current lease liabilities |
36,551 |
37,497 |
5,723 |
Total current liabilities |
1,271,289 |
1,366,371 |
208,549 |
Non-current liabilities |
|||
Non-current lease liabilities |
27,709 |
23,150 |
3,533 |
Deferred tax liabilities |
225,745 |
151,969 |
23,195 |
Total non-current liabilities |
253,454 |
175,119 |
26,728 |
Total liabilities |
1,524,743 |
1,541,490 |
235,277 |
Total mezzanine equity |
4,837,336 |
4,947,623 |
755,154 |
Shareholders' deficit |
|||
Ordinary shares |
41 |
41 |
6 |
Additional paid-in capital |
- |
- |
- |
Accumulated other comprehensive income |
14,956 |
13,241 |
2,021 |
Accumulated deficit |
(1,672,021) |
(2,130,710) |
(325,210) |
Total shareholders' deficit |
(1,657,024) |
(2,117,428) |
(323,183) |
Total liabilities, mezzanine equity and |
4,705,055 |
4,371,685 |
667,248 |
WATERDROP INC. |
|||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS |
|||
(All amounts in thousands, except for share and per share data, or otherwise noted) |
|||
For the Three Months Ended March 31, |
|||
2020 |
2021 |
||
RMB |
RMB |
USD |
|
Operating revenue, net |
653,795 |
883,367 |
134,828 |
Operating costs and expenses(i) |
|||
Operating costs |
(133,288) |
(300,608) |
(45,882) |
Sales and marketing expenses |
(499,201) |
(837,153) |
(127,775) |
General and administrative expenses |
(64,765) |
(121,287) |
(18,512) |
Research and development expenses |
(67,610) |
(84,875) |
(12,954) |
Total operating costs and expenses |
(764,864) |
(1,343,923) |
(205,123) |
Operating loss |
(111,069) |
(460,556) |
(70,295) |
Other income |
|||
Interest income |
5,312 |
13,215 |
2,017 |
Foreign currency exchange gain |
5,235 |
784 |
120 |
Others, net |
1,632 |
2,101 |
321 |
Loss before income tax, and share of loss in |
(98,890) |
(444,456) |
(67,837) |
Income tax (expense)/benefit |
(21,838) |
74,300 |
11,340 |
Share of loss in equity method investee |
(3) |
- |
- |
Net loss attributable to Waterdrop Inc. |
(120,731) |
(370,156) |
(56,497) |
Preferred shares redemption value accretion |
(53,636) |
(110,287) |
(16,833) |
Net loss attributable to ordinary shareholders |
(174,367) |
(480,443) |
(73,330) |
Net loss |
(120,731) |
(370,156) |
(56,497) |
Other comprehensive (income)/loss: |
|||
Foreign currency translation adjustment, net |
61 |
(2,782) |
(425) |
Unrealized gains on available for sale |
25 |
1,067 |
163 |
Comprehensive loss |
(120,645) |
(371,871) |
(56,759) |
Weighted average number of ordinary shares |
1,193,727,557 |
1,191,599,014 |
1,191,599,014 |
Basic and diluted |
|||
Net loss per share attributable to ordinary |
|||
Basic and diluted |
(0.15) |
(0.40) |
(0.06) |
(i) Share-based compensation expenses are included in the operating costs and expenses as follows: |
|||
For the Three Months Ended March 31, |
|||
2020 |
2021 |
||
RMB |
RMB |
USD |
|
Sales and marketing expenses |
(322) |
(2,981) |
(455) |
General and administrative expenses |
(17,389) |
(62,021) |
(9,466) |
Research and development expenses |
(1,722) |
(6,176) |
(943) |
Total |
(19,433) |
(71,178) |
(10,864) |
WATERDROP INC. |
|||
Reconciliations of GAAP and Non-GAAP Results |
|||
(All amounts in thousands, unless otherwise noted) |
|||
For the Three Months Ended March 31, |
|||
2020 |
2021 |
||
RMB |
RMB |
USD |
|
Net operating revenue |
653,795 |
883,367 |
134,828 |
Less: |
|||
Management fee income |
38,886 |
2,745(ii) |
419 |
Adjusted net operating revenue |
614,909 |
880,622 |
134,409 |
For the Three Months Ended March 31, |
|||
2020 |
2021 |
||
RMB |
RMB |
USD |
|
Net loss |
(120,731) |
(370,156) |
(56,497) |
Add: |
|||
Share-based compensation expense |
19,433 |
71,178 |
10,864 |
Foreign currency exchange gain |
(5,235) |
(784) |
(120) |
Impact of terminating the mutual aid plan (iii) |
- |
96,697 |
14,759 |
Share of results of equity method investee |
3 |
- |
- |
Adjusted net loss |
(106,530) |
(203,065) |
(30,994) |
(ii) This represents management fee revenue related to the mutual aid business for the first quarter of 2021 after recording the |
|||
(iii) This represents the estimated cost of medical expenses and cost of one-year health insurance coverage. RMB19.9 million |
View original content:http://www.prnewswire.com/news-releases/waterdrop-inc-announces-first-quarter-2021-unaudited-financial-results-301314431.html