Leju Reports Second Quarter 2015 Results

Aug 25, 2015, 05:30 ET from Leju Holdings Limited

BEIJING, Aug. 25, 2015 /PRNewswire/ -- Leju Holdings Limited ("Leju" or the "Company") (NYSE: LEJU), a leading online-to-offline ("O2O") real estate services provider in China, today announced its unaudited financial results for the fiscal quarter ended June 30, 2015.

Second Quarter 2015 Financial Highlights

  • Total revenues increased by 34% year-on-year to $157.8 million
      • Revenues from e-commerce services increased by 72% year-on-year to $117.4 million
      • Revenues from listing services increased by 23% year-on-year to $5.2 million
  • Non-GAAP[1] income from operations decreased by 13% year-on-year to $21.0 million
  • Non-GAAP net income attributable to Leju shareholders decreased by 16% year-on-year to $17.1 million, or $0.12 per diluted ADS

[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 and amortization of intangible assets resulting from business acquisitions. 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.

First Half 2015 Financial Highlights

  • Total revenues increased by 28% year-on-year to $251.2 million
      • Revenues from e-commerce services increased by 56% year-on-year to $184.4 million
      • Revenues from listing services increased by 7% year-on-year to $9.0 million
  • Non-GAAP income from operations decreased by 36% year-on-year to $20.7 million.
  • Non-GAAP net income attributable to Leju shareholders decreased by 36% year-on-year to $18.1 million, or $0.13 per diluted ADS.

"We are pleased with the Company's revenue growth this quarter," said Mr. Geoffrey He, Leju's chief executive officer. "Real estate market activity in major Chinese cities gradually recovered in the second quarter, which benefited all of Leju's businesses lines. We focused on increasing our market share in the e-commerce business and developing new products and services that aim to improve the connectivity between online and offline home purchasing activities. We resumed growth in our secondary verified listing business as a result of increased subscribing agents and steady pricing levels. In addition, our home furnishing contractor platform launched this year continued to gain momentum in attracting new contractors and has recently set up our closed loop transaction platform. We believe our clear strategies across the three business lines will help the Company achieve immediate and long-term success as a leading O2O services platform."

Second Quarter 2015 Results

Total revenues were $157.8 million, an increase of 34% from $117.4 million for the same quarter of 2014, mainly driven by growth of revenues from e-commerce services.

Revenues from e-commerce services were $117.4 million, an increase of 72% from $68.3 million for the same quarter of 2014, primarily due to increases in both the number of discount coupons redeemed and in the average price per discount coupon redeemed.

Revenues from online advertising services were $35.2 million, a decrease of 21% from $44.8 million for the same quarter of 2014, primarily due to a decrease in property developers' online advertising demand.

Revenues from listing services were $5.2 million, an increase of 23% from $4.2 million for the same quarter of 2014, primarily due to growth in secondary home sales.

Cost of revenues was $15.7 million, an increase of 34% from $11.7 million for the same quarter of 2014, primarily due to increased staff cost of editorial department and increased amortization of intangible assets consisting of exclusive rights.

Selling, general and administrative expenses were $127.5 million, an increase of 44% from $88.5 million for the same quarter of 2014, primarily due to increased marketing expenses related to the growth of the Company's e-commerce business.

Income from operations was $15.0 million in the second quarter of 2015, a decrease of 19% from $18.5 million for the same quarter of 2014. Non-GAAP income from operations was $21.0 million, a decrease of 13% from $24.1 million for the same quarter of 2014.

Net income was $11.6 million, a decrease of 26% from $15.6 million for the same quarter of 2014. Non-GAAP net income was $16.9 million, a decrease of 19% from $20.8 million for the same quarter of 2014.

Net income attributable to Leju shareholders was $11.8 million, or $0.09 per diluted ADS, a decrease of 23% from $15.4 million, or $0.12 per diluted ADS, for the same quarter of 2014. Non-GAAP net income attributable to Leju shareholders was $17.1 million, or $0.12 per diluted ADS, a decrease of 16% from $20.5 million, or $0.15 per diluted ADS, for the same quarter of 2014.

First Half 2015 Results

Total revenues were $251.2 million, an increase of 28% from $195.9 million for the same period of 2014, mainly driven by growth of revenues from e-commerce services.

Revenues from e-commerce services were $184.4 million, an increase of 56% from $118.0 million for the same period of 2014, primarily due to an increase in the average price per discount coupon redeemed.

Revenues from online advertising services were $57.8 million, a decrease of 17% from $69.4 million for the same period of 2014, primarily due to a decrease in property developers' online advertising demand.

Revenues from listing services were $9.0 million, an increase of 7% from $8.5 million for the same period of 2014, primarily due to the growth in secondary home sales in the second quarter of 2015.

Cost of revenues was $30.5 million, an increase of 28% from $23.9 million for the same period of 2014, primarily due to increased staff cost of editorial department as a result of increased headcount and amortization of intangible assets consisting of exclusive rights.

Selling, general and administrative expenses were $213.7 million, an increase of 40% from $153.0 million for the same period of 2014, primarily due to increased marketing expenses related to the growth of the Company's e-commerce business.

Income from operations was $7.5 million in the first half of 2015, a decrease of 63% from $20.5 million for the same period of 2014. Non-GAAP income from operations was $20.7 million, a decrease of 36% from $32.5 million for the same period of 2014.

Net income was $6.2 million, a decrease of 65% from $17.4 million for the same period of 2014. Non-GAAP net income was $17.8 million, a decrease of 37% from $28.0 million for the same period of 2014.

Net income attributable to Leju shareholders was $6.5 million, or $0.05 per diluted ADS, a decrease of 63% from $17.6 million, or $0.14 per diluted ADS, for the same period of 2014. Non-GAAP net income attributable to Leju shareholders was $18.1 million, or $0.13 per diluted ADS, a decrease of 36% from $28.1 million, or $0.22 per diluted ADS, for the same period of 2014.

Cash Flow

As of June 30, 2015, the Company's cash and cash equivalents balance was $263.3 million.

Second quarter 2015 net cash provided by operating activities was $9.3 million, mainly attributable to non-GAAP net income of $16.9 million, an increase in other tax payable and income tax payable of $6.2 million, and an increase in accrued payroll and welfare of $4.4 million, partially offset by an increase in accounts receivable of $9.5 million and a decrease in amount due to related parties of $7.2 million. Net cash used in investing activities was $4.6 million, mainly comprised of a payment of $4.1 million for exclusive rights. Net cash used in financing activities was $29.4 million, mainly comprised of a dividend payment of $26.9 million and a payment of $2.9 million for acquisition of non-controlling interests, which was made in 2014.

Business Outlook

The Company maintains its fiscal year 2015 total revenue guidance of approximately $600 million to $620 million, which would represent an increase of approximately 21% to 25% from $496.0 million in 2014. This forecast reflects the Company's current and preliminary view, which is subject to change.

Conference Call Information

Leju's management will host an earnings conference call on August 25, 2015 at 7 a.m. U.S. Eastern Time (7 p.m. Beijing/Hong Kong time).

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

U.S./International:

+1-855-298-3404

Hong Kong:         

+852-5808-3202

Mainland China:   

+400-120-0539

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 September 1, 2015:

U.S./International:

+1-866-846-0868

Hong Kong:         

+ 800-966-697

Mainland China:   

+ 400-184-2240

Passcode:     

9929582

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 online-to-offline, or O2O, real estate services provider 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 260 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 leading internet companies such as SINA Corporation and Baidu Inc., 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 recent carve-out from E-House and prior reliance on E-House for various corporate services; its reliance on SINA, Baidu 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 controlling interest in 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 and amortization of intangible assets resulting from business acquisitions. 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. Melody Liu Leju Holdings Limited Phone: +86 (10) 5895-1062 E-mail: ir@leju.com

Mr. Derek Mitchell Ogilvy Financial In the U.S.: +1 (646) 867-1888 In China: +86 (10) 8520-6139 E-mail: leju@ogilvy.com

 

 

LEJU HOLDINGS LIMITED

UNAUDITED CONSOLIDATED BALANCE SHEETS

(In thousands of U.S. dollars)

December 31,

June 30,

2014

2015

ASSETS

Current assets

Cash and cash equivalents

317,811

263,348

Accounts receivable, net

119,742

121,679

Deferred tax assets, net

29,858

29,884

Prepaid expenses and other current assets

13,355

22,879

Customer deposits

-

17,804

Amounts due from related parties

1

9

Total current assets

480,767

455,603

Property and equipment, net

7,159

6,910

Intangible assets, net

105,419

105,126

Investment in affiliates

273

118

Goodwill

40,563

40,575

Other non-current assets

4,085

3,029

Total assets

638,266

611,361

LIABILITIES AND EQUITY

Current liabilities

Accounts payable

371

441

Accrued payroll and welfare expenses

48,007

43,915

Income tax payable

57,246

54,167

Other tax payable

27,805

29,480

Amounts due to related parties

5,289

6,969

Advance from customers and deferred revenue

5,054

5,905

Liability for exclusive rights, current

-

8,179

Accrued marketing and advertising expenses

19,270

10,371

Consideration payable of acquiring non-controlling interest

25,646

16,601

Other current liabilities

8,612

8,343

Total current liabilities

197,300

184,371

Deferred tax liabilities

26,042

26,065

Total liabilities

223,342

210,436

Equity

Ordinary shares ($0.001 par value): 500,000,000 shares    authorized, 134,015,621 and 134,656,156 shares issued and    outstanding, as of December 31, 2014 and June 30, 2015,    respectively

134

135

Additional paid-in capital

788,247

767,822

Accumulated deficit

(377,876)

(371,905)

Subscription receivables

(689)

-

Accumulated other comprehensive income

5,030

5,146

Total Leju equity

414,846

401,198

Non-controlling interests

78

(273)

Total equity

414,924

400,925

TOTAL LIABILITIES AND EQUITY

638,266

611,361

 

 

LEJU HOLDINGS LIMITED

UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS

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

Three months ended

Six months ended

June 30,

June 30,

2014

2015

2014

2015

Revenues

E-commerce

68,311

117,363

118,032

184,419

Online advertising services

44,814

35,244

69,416

57,786

Listing services

4,238

5,199

8,456

9,032

Total revenues

117,363

157,806

195,904

251,237

Cost of revenues

(11,726)

(15,662)

(23,862)

(30,526)

Selling, general and administrative expenses

(88,485)

(127,457)

(152,952)

(213,736)

Other operating income

1,356

287

1,378

511

Income from operations

18,508

14,974

20,468

7,486

Interest income

216

254

429

643

Other income (expenses), net

77

(38)

63

141

Income before taxes and equity in affiliates

18,801

15,190

20,960

8,270

Income tax expense

(3,102)

(3,484)

(3,458)

(1,943)

Income before equity in affiliates

15,699

11,706

17,502

6,327

Loss from equity in affiliates

(68)

(77)

(114)

(155)

Net income

15,631

11,629

17,388

6,172

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

260

(217)

(225)

(351)

Net income attributable to Leju shareholders

15,371

11,846

17,613

6,523

Earnings per share:

Basic

0.12

0.09

0.14

0.05

Diluted

0.12

0.09

0.14

0.05

Shares used in computation:

Basic

130,126,703

134,574,518

125,063,352

134,341,261

Diluted

133,029,471

136,996,405

127,453,210

136,942,190

Note 1

The conversion of Renminbi ("RMB") amounts into USD amounts is based on the rate of USD1 = RMB6.1136 on June 30, 2015 and USD1 = RMB6.1223 for the three months ended June 30, 2015

 

 

LEJU HOLDINGS LIMITED

UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands of U.S. dollars)

Three months ended

Six months ended

June 30,

June 30,

2014

2015

2014

2015

Net income

15,631

11,629

17,388

6,172

Other comprehensive income (loss), net of tax of nil

Foreign currency translation adjustment

161

594

(654)

117

Comprehensive income

15,792

12,223

16,734

6,289

Less: Comprehensive income (loss) attributable     to non-controlling interest

249

(214)

(335)

(351)

Comprehensive income attributable to Leju shareholders

15,543

12,437

17,069

6,640

 

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

Six months ended

June 30,

June 30,

2014

2015

2014

2015

(unaudited)

(unaudited)

(unaudited)

(unaudited)

GAAP income from operations 

18,508

14,974

20,468

7,486

Share-based compensation expense

2,361

2,879

4,038

6,834

Amortization of intangible assets resulting from business    acquisitions

3,272

3,164

8,021

6,339

Non-GAAP income from operations

24,141

21,017

32,527

20,659

GAAP net income 

15,631

11,629

17,388

6,172

Share-based compensation expense (net of tax)

2,361

2,879

4,038

6,834

Amortization of intangible assets resulting from 

   business acquisitions (net of tax)

2,762

2,373

6,550

4,754

Non-GAAP net income 

20,754

16,881

27,976

17,760

Net income attributable to Leju shareholders

15,371

11,846

17,613

6,523

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

2,361

2,879

4,038

6,834

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

2,732

2,373

6,464

4,754

Non-GAAP net income attributable to Leju    shareholders

20,464

17,098

28,115

18,111

GAAP net income per ADS — basic

0.12

0.09

0.14

0.05

GAAP net income per ADS — diluted

0.12

0.09

0.14

0.05

Non-GAAP net income per ADS — basic

0.16

0.13

0.22

0.13

Non-GAAP net income per ADS — diluted

0.15

0.12

0.22

0.13

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

130,126,703

134,574,518

125,063,352

134,341,261

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

133,029,471

136,996,405

127,453,210

136,942,190

 

 

 

LEJU HOLDINGS LIMITED

SELECTED OPERATING DATA

Three months ended

Six months ended

June 30,

June 30,

2014

2015

2014

2015

Operating data for e-commerce services

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

89,524

94,489

137,964

135,254

Number of discount coupons redeemed (number     of transactions)

49,724

52,413

83,596

84,524

 

 

SOURCE Leju Holdings Limited



RELATED LINKS

http://ir.leju.com