BEIJING, Nov. 26, 2019 /PRNewswire/ -- Renren Inc. (NYSE: RENN) ("Renren" or the "Company"), which operates a leading premium used auto business in China through its subsidiary Kaixin Auto Holdings (NASDAQ: KXIN) as well as several U.S.-based SaaS businesses, today announced its unaudited financial results for the second quarter ended June 30, 2019.

Second Quarter 2019 Highlights

  • Total net revenues were US$104.8 million, a 19.3% decrease from the corresponding period in 2018.
    Kaixin revenues (1) were US$100.0 million, an 8.1% decrease from the corresponding period in 2018.
  • Operating loss was US$15.3 million, improved from an operating loss of US$31.9 million in the corresponding period in 2018.
  • Net income attributable to the Company was US$95.7 million, compared to a net income attributable to the Company of US$166.1 million in the corresponding period in 2018.
  • Adjusted loss from continuing operations (2) (non-GAAP) was US$11.2 million, improved from an adjusted loss from continuing operations of US$18.3 million in the corresponding period in 2018.
  • Adjusted net loss (2) (non-GAAP) was US$8.0 million, compared to an adjusted net income of US$177.5 million in the corresponding period in 2018.

(1)  Kaixin revenues are the net revenue from the Company's subsidiary Kaixin Auto Holdings, which are included in the Company's Auto Group segment. Please refer to the table of additional information for details.

(2)  Adjusted loss from continuing operations and net income (loss) are non-GAAP measures, which are defined as loss from operations excluding share-based compensation expenses and amortization of intangible assets and net income (loss) excluding share-based compensation expenses, fair value change of contingent consideration and amortization of intangible assets, respectively. See "About Non-GAAP Financial Measures" below.

"Second quarter revenues remained under pressure from the intensified competition and challenging macroeconomic environment. On the positive side, we are excited that Kaixin successfully listed on Nasdaq in April. Kaixin's separate listing opened a new chapter for Renren. As our premium auto dealership business, Kaixin now enjoys higher brand recognition. Going forward, we will continue to power our dealers with capital, technological systems, and marketing capabilities," commented Mr. Joseph Chen, Chairman and Chief Executive Officer.

Second Quarter 2019 Results

Total net revenues for the second quarter of 2019 were US$104.8 million, representing a 19.3% decrease from the corresponding period in 2018.

Automobile sales revenues for the second quarter of 2019 were US$98.3 million, representing a 19.9% decrease from the corresponding period in 2018. The decrease was mainly due to our reduction in resources allocated to low-performing dealers, as we aim to reallocate resources to better performing dealers for our long-term growth and profitability.

Cost of revenues was US$100.3 million, compared to US$125.5 million from the corresponding period of 2018. The decrease was in line with the decrease of revenue.

Operating expenses were US$19.8 million, a 45.3% decrease from the corresponding period of 2018.

Selling and marketing expenses were US$6.0 million, a 31.9% decrease from the corresponding period of 2018. The decrease was primarily due to the decrease in headcount and personnel-related expenses.  

Research and development expenses were US$6.5 million, a 5.7% increase from the corresponding period in 2018. The increase was primarily due to an increase in headcount and personnel-related expenses.

General and administrative expenses were US$7.3 million, a 65.7% decrease from the corresponding period in 2018. The decrease was primarily due to a decrease in share-based compensation expenses and a decrease in headcount and personnel-related expenses.

Share-based compensation expenses, which were all included in operating expenses, were US$4.1 million, compared to US$13.5 million in the corresponding period in 2018. The decrease was mainly due to a modification which repriced the exercise price with respect to options during the second quarter of 2018, which led to the higher share-based compensation expenses in the three months ended June 30, 2018 compared to the three months ended June 30, 2019.

Loss from operations was US$15.3 million, improved from a loss from operations of US$31.9 million in the corresponding period in 2018.

Net income attributable to Renren Inc. was US$95.7 million, compared to a net income of US$166.1 million in the corresponding period in 2018.

Adjusted loss from continuing operations (non-GAAP) was US$11.2 million, improved from an adjusted loss from continuing operations of US$18.3 million in the corresponding period in 2018. Adjusted loss from operations is defined as loss from operations excluding share-based compensation expenses and amortization of intangible assets.

Adjusted net loss (non-GAAP) was US$8.0 million, compared to an adjusted net income of US$177.5 million in the corresponding period in 2018. The adjusted net income for the second quarter of 2018 was mainly attributable to a one-time gain amounting to US$180.8 million that resulted from the private placement transaction relating to the disposition of Oak Pacific Investment. Adjusted net loss is defined as net loss excluding share-based compensation expenses, fair value change of contingent consideration and amortization of intangible assets.

Business Outlook

The Company expects to generate revenues in an amount ranging from US$72 million to US$82 million in the third quarter of 2019. This forecast reflects the Company's current and preliminary view, which is subject to change.

Conference Call Information

The Company will not host a conference call. Please contact our Investor Relations Department if you have any questions. Renren's subsidiary Kaixin Auto Holdings will host an earnings conference call at 9:00 AM U.S. Eastern Time on November 26, 2019 (10:00 PM Beijing/Hong Kong time on November 26, 2019).

Interested parties may participate in the conference call by dialing:

United States:

1-845-675-0437

International:

+65-6713-5090

Hong Kong:

+852-3018-6771

Mainland China:

400-620-8038

Conference ID:

9286069

Additionally, a live and archived webcast of the conference call will be available on its investor relations website at http://ir.kaixin.com.

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

United States:

1-646-254-3697

International:
Hong Kong:
Mainland China:

+61-2-8199-0299
+852-3051-2780
400-632-2162

Replay Access Code:

9286069

About Renren Inc.

Renren Inc. (NYSE: RENN) operates a leading premium used auto business in China through its subsidiary Kaixin Auto Holdings (NASDAQ: KXIN) as well as several US-based SaaS business. Renren's American depositary shares, each of which currently represents fifteen Class A ordinary shares, trade on NYSE under the symbol "RENN".

Safe Harbor Statement

This announcement contains forward-looking statements. These 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," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Among other things, the business outlook for the third quarter of 2019 and quotations from management in this announcement, as well as Renren's strategic and operational plans, contain forward-looking statements. Renren may also make written or oral forward-looking statements in its filings with the U.S. Securities and Exchange Commission ("SEC"), 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 Renren's beliefs 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: Renren's goals and strategies; Renren's future business development, financial condition and results of operations; Renren's expectations regarding demand for and market acceptance of its services; Renren's expectations regarding the retention and strengthening of its relationships with used auto dealerships; Renren's plans to enhance user experience, infrastructure and service offerings; competition in the used auto industry in China; and government policies and regulations relating to the used auto industry in China. Further information regarding these and other risks is included in our annual report on Form 20-F and other documents filed with the SEC. All information provided in this press release and in the attachments is as of the date of this press release, and Renren does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

About Non-GAAP Financial Measures

To supplement Renren's consolidated financial results presented in accordance with United States Generally Accepted Accounting Principles ("GAAP"), Renren uses "adjusted income (loss) from operations" and "adjusted net income (loss)" which are defined as non-GAAP financial measures by the SEC, in evaluating its business. Renren defines adjusted income (loss) from operations as income (loss) from operations excluding share-based compensation expenses and amortization of intangible assets and adjusted net income (loss) as net income (loss) excluding share-based compensation expenses, fair value change of contingent consideration and amortization of intangible assets, respectively. Renren continuously and periodically reviews its operating results and business performance. Starting from the first quarter of 2018, there was a significant impact on net income (loss) due to the material and significant noncash amount of fair value change of contingent consideration relating to the used auto dealerships of the emerging used auto business. Due to the nature of the business, Renren believes that including adjusted income (loss) from operations and excluding the impact of such fair value changes more appropriately reflects Renren's results of operations, and provides investors with a better understanding of Renren's business performance. To facilitate investors and analysts, the aforesaid impact is presented retrospectively in "Reconciliation of non-GAAP results of operations measures to the comparable GAAP financial measures". Renren presents adjusted income (loss) from operations and adjusted net income (loss) because they are used by Renren's management to evaluate its operating performance. Renren also believes that these non-GAAP financial measures provide useful information to investors and others in understanding and evaluating Renren's consolidated results of operations in the same manner as Renren's management and in comparing financial results across accounting periods and to those of Renren's peer companies.

These non-GAAP financial measures are not intended to be considered in isolation from, 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 "Reconciliation of non-GAAP results of operations measures to the comparable GAAP financial measures" at the end of this release.

For more information, please contact:

Cynthia Liu
Investor Relations Department
Renren Inc.
Tel: (86 10) 8448 1818 ext. 1300
Email: ir@renren-inc.com

 

 

 

RENREN INC.






CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(In thousands of US dollars)















December 31,


June 30,




2018


2019







 ASSETS 












 Current assets: 






 Cash and cash equivalents 


$

15,333

$

9,872

 Restricted cash 



5,818


-

 Accounts receivable, net 



2,584


1,490

 Financing receivable, net 



3,486


107

 Prepaid expenses and other current assets 



49,515


51,845

 Amounts due from related parties 



20,829


17,185

 Inventory 



59,197


44,832

 Total current assets 



156,762


125,331







 Non-current assets: 






 Property and equipment, net 



1,555


780

 Goodwill and intangible assets, net 



85,526


85,448

 Long-term investments 



22,341


22,034

 Amount due from related parties- non-current 



133,880


137,539

 Restricted cash – non-current  



36,362


14,406

 Right-of-use lease assets 



-


6,185

 Other non-current assets 



767


726

 Total non-current assets 



280,431


267,118







 TOTAL ASSETS 


$

437,193

$

392,449







 LIABILITIES AND EQUITY 












 Current liabilities: 






 Accounts payable 


$

8,255

$

6,511

 Short-term debt 



49,887


29,657

 Accrued expenses and other current liabilities 



33,055


30,879

 Short-term lease liabilities 



-


3,368

 Payable to investors 



15


15

 Amounts due to related parties 



55


4,899

 Deferred revenue 



3,716


2,394

 Income tax payable 



20,602


20,968

 Contingent consideration  



11,929


2,055

 Total current liabilities 



127,514


100,746







 Non-current liabilities: 






 Long-term debt 



35,000


1,000

 Long-term lease liabilities 



-


1,783

 Long-term contingent consideration 



93,741


16,701

 Total non-current liabilities 



128,741


19,484







 TOTAL LIABILITIES 


$

256,255

$

120,230







 Shareholders' Equity: 






 Class A ordinary shares 



737


743

 Class B ordinary shares 



305


305

 Additional paid-in capital 



709,137


706,062

 Statutory reserves 



6,712


6,712

 Accumulated deficit 



(563,737)


(496,010)

 Accumulated other comprehensive loss 



(5,689)


(6,334)







 Total Renren Inc. shareholders' equity 



147,465


211,478







 Noncontrolling interest 



33,473


60,741







 TOTAL EQUITY 



180,938


272,219







 TOAL LIABILITIES AND EQUITY 


$

437,193

$

392,449

 

 

 

RENREN INC.




CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

(In thousands of US dollars, except share data and per share data, ADS data, and per ADS data)



















For the Three Months Ended


For the Six Months Ended




June 30,



March 31,



June 30,



June 30,



June 30,




2018



2019



2019



2018



2019

 Net revenues: 
















 Automobile sales 


$

122,728


$

102,620


$

98,294


$

246,334


$

200,914

 Others 



7,018



7,743



6,471



17,366



14,214

 Total net revenues 



129,746



110,363



104,765



263,700



215,128

















 Cost of revenues  



(125,503)



(101,537)



(100,336)



(249,022)



(201,873)

















 Gross profit 



4,243



8,826



4,429



14,678



13,255

















 Operating expenses: 
















 Selling and marketing 



(8,841)



(6,745)



(6,024)



(18,813)



(12,769)

 Research and development 



(6,131)



(6,760)



(6,483)



(12,525)



(13,243)

 General and administrative 



(21,188)



(6,387)



(7,270)



(38,966)



(13,657)

















 Total operating expenses 



(36,160)



(19,892)



(19,777)



(70,304)



(39,669)

















 Loss from operations 



(31,917)



(11,066)



(15,348)



(55,626)



(26,414)

















 Other  income  



28,618



771



1,734



28,207



2,505

 Fair value change of contingent consideration 



2,197



(17,733)



105,849



(8,068)



88,116

 Interest income 



411



2,427



1,966



1,214



4,393

 Interest expenses 



(900)



(918)



(550)



(2,164)



(1,468)

 Total non-operating income (loss)  



30,326



(15,453)



108,999



19,189



93,546

















 (Loss) income before provision of income tax and loss in
equity method investments, net of tax 



(1,591)



(26,519)



93,651



(36,437)



67,132

 Income tax expenses 



(116)



(1,100)



472



(947)



(628)

















 (Loss) income before loss in equity method investments
and noncontrolling interest, net of tax 



(1,707)



(27,619)



94,123



(37,384)



66,504

  Loss in equity method investments, net of tax 



(621)



(436)



(474)



(1,429)



(910)

 (Loss) income from continuing operations 



(2,328)



(28,055)



93,649



(38,813)



65,594

















 Discontinued operations: 
















 Loss from operations of discontinued operations, net of
income tax 



(12,482)



-



-



(17,567)



-

 Gain on deconsolidation of subsidiaries, net of income
tax 



180,829



-



-



180,829



-

 Income from discontinued operations, net of tax 



168,347



-



-



163,262



-

















 Net income (loss) 



166,019



(28,055)



93,649



124,449



65,594

 Net loss attributable to noncontrolling interest 



100



108



2,025



120



2,133

















 Net income (loss) attributable to Renren Inc. 


$

166,119


$

(27,947)


$

95,674


$

124,569


$

67,727

















 Net (loss) income per share from continuing operations
attributable to Renren Inc. shareholders:
















 Basic 


$

-


$

(0.03)


$

0.07


$

(0.04)


$

0.06

 Diluted 


$

-


$

(0.03)


$

0.06


$

(0.04)


$

0.04

















 Net income (loss) per share from discontinued
operations attributable to Renren Inc. shareholders: 
















 Basic 


$

0.16


$

-


$

-


$

0.16


$

-

 Diluted 


$

0.15


$

-


$

-


$

0.15


$

-

















 Net income (loss) per share attributable to Renren Inc.
shareholders: 
















 Basic 


$

0.16


$

(0.03)


$

0.07


$

0.12


$

0.06

 Diluted 


$

0.15


$

(0.03)


$

0.06


$

0.11


$

0.04

 Net income (loss) attributable to Renren Inc.
shareholders per ADS*: 
















 Basic 


$

2.41


$

(0.40)


$

1.05


$

1.81


$

0.90

 Diluted 


$

2.21


$

(0.40)


$

0.84


$

1.71


$

0.53

















 Weighted average number of shares used in calculating
net income(loss) per ordinary share attributable to
Renren Inc. shareholders: 
















 Basic 



1,035,143,003



1,043,848,165



1,047,002,854



1,034,310,179



1,045,443,122

 Diluted 



1,130,285,008



1,043,848,165



1,082,360,638



1,093,742,531



1,083,883,429

 Weighted average number of shares used in calculating
net income(loss) per ordinary share from discontinued
operations attributable to Renren Inc. shareholders: 
















 Basic 



1,035,143,003



1,043,848,165



1,047,002,854



1,034,310,179



1,045,443,122

 Diluted 



1,130,285,008



1,043,848,165



1,082,360,638



1,093,742,531



1,083,883,429

















 * Each ADS represents 15 Class A ordinary shares. 
































































































 Reconciliation of Non-GAAP results of operations measures to the comparable GAAP financial measures 

 (In thousands of US dollars) 


































For the Three Months Ended


For the Six Months Ended




June 30,



March 31,



June 30,



June 30,



June 30,



2018



2019



2019



2018



2019

















 Loss from opeartions 


$

(31,917)


$

(11,066)


$

(15,348)


$

(55,626)


$

(26,414)

 Add back: Shared-based compensation expenses 



13,465



2,809



4,060



25,792



6,869

  Add back: Amortization of intangible assets 



131



96



96



262



192

 Adjusted loss from continuing operations 


$

(18,321)


$

(8,161)


$

(11,192)


$

(29,572)


$

(19,353)

















 Net income (loss) 


$

166,119


$

(28,055)


$

93,649


$

124,569


$

65,594

 Add back: Shared-based compensation expenses 



13,465



2,809



4,060



25,792



6,869

  Add back: Fair value change of contingent
consideration  



(2,197)



17,733



(105,849)



8,068



(88,116)

  Add back: Amortization of intangible assets 



131



96



96



262



192

 Adjusted net income (loss) 


$

177,518


$

(7,417)


$

(8,044)


$

158,691


$

(15,461)

 

 

 

RENREN INC.























ADDITIONAL INFORMATION (UNAUDITED)





















(In thousands of US dollars)

















































For the Three Months Ended



June 30, 2018


March 31, 2019


June 30,  2019




Kaixin


Ji'nan
dealership*


Renren


Total



Kaixin


Renren


Total



Kaixin


Renren


Total


























 Net revenues: 
























 Automobile sales 

$

106,700

$

16,028

$

-

$

122,728


$

102,620

$

-

$

102,620


$

98,294

$

-

$

98,294


 Others 


2,052


25


4,941


7,018



2,026


5,717


7,743



1,659


4,812


6,471


 Total 


108,752


16,053


4,941


129,746



104,646


5,717


110,363



99,953


4,812


104,765


















































 Cost of revenues  

$

107,613

$

15,219

$

2,671

$

125,503


$

98,529

$

3,008

$

101,537


$

97,440

$

2,896

$

100,336


















































* Ji'nan dealership was transferred from Kaixin Auto Group to Renren in the fourth quarter of 2018. Ji'nan dealership and Kaixin were included in the Company's Auto Group segment in 2018.

 

 

 

Cision View original content:http://www.prnewswire.com/news-releases/renren-announces-unaudited-second-quarter-2019-financial-results-300965221.html

SOURCE Renren Inc.


Source: Renren Inc.