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LightInTheBox Reports Third Quarter 2021 Financial Results

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SHANGHAI, Dec. 2, 2021 /PRNewswire/ -- LightInTheBox Holding Co., Ltd. (NYSE: LITB) ("LightInTheBox" or the "Company"), a cross-border e-commerce platform that delivers products directly to consumers around the world, today announced its unaudited financial results for the third quarter ended September 30, 2021.

Third Quarter and First Nine Months 2021 Financial Highlights



Three Months Ended


Year-over-
Year %

Change


Nine Months Ended


Year-over-
Year %

Change

In millions, except percentages


September 30,


September 30,



September 30,


September 30,


2020


2021

2020


2021


Total revenues


$

100.0


$

98.7


-1.3%


$

265.4


$

333.0


25.5%

- Apparel sales


$

44.4


$

61.9


39.6%


$

95.7


$

196.3


105.1%

Gross margin


43.1%


44.5%




43.9%


46.0%



Net income / (loss)


$

7.3


$

(6.1)




$

16.5


$

4.7


-71.5%

Adjusted EBITDA


$

12.7


$

(5.1)




$

23.3


$

11.7


-49.8%




























As of December 31,


As of September 30,



In millions


2020


2021



Cash, cash equivalents and restricted cash


$

65.5


$

50.2



Mr. Jian He, Chief Executive Officer of LightInTheBox, commented, "We experienced certain cost pressures and challenging global economic conditions this quarter, which caused our results to be materially affected by external factors including higher than anticipated digital advertising cost, new European laws on VAT and market regulation on certain products, and changes in consumer sentiment and spending. Our operational costs were also affected by rising shipping and delivery cost, and fluctuation in foreign exchange rates. Despite the challenging economic environment, we are always optimizing our product mix especially for the higher margin apparel categories compared to standard categories like electronics. Our strength and experience in apparel has given us the capabilities to quickly respond to market uncertainties and meet the demand of evolving fashion trends. We remain committed to our proven growth strategy that capitalizes on our advantages in value-added services for online purchases and provides consumers with a well curated variety of globally sourced quality products. Total revenues for the third quarter were $98.7 million, compared with $100.0 million in the same quarter of 2020, while gross margin improved to 44.5 percent. During the third quarter, apparel sales represented 64.5% of our total product sales, up by 39.6% to $61.9 million in the third quarter of 2021 compared with $44.4 million of the same quarter in the prior year, which was largely attributed to our continuous efforts in R&D to provide trending fashion insights to our designers and suppliers. We remain firmly on course with our growth momentum and our values and are always reaching beyond our customers' expectations as their comprehensive and reliable shopping destination of choice."

Third Quarter 2021 Financial Results

Total revenues remained relatively stable year-over-year, which were $98.7 million and $100.0 million in the third quarter of 2021 and 2020, respectively. Revenues generated from product sales were $96.0 million, compared with $95.4 million in the same quarter of 2020. Revenues from service and others were $2.7 million, compared with $4.6 million in the same quarter of 2020. Included in product sales, revenues from apparel increased by 39.6% to $61.9 million in the third quarter of 2021, compared with $44.4 million in the same quarter of 2020. Revenues from apparel represented 64.5% of total product sales in the third quarter of 2021, and 46.5% in the same quarter of 2020.

Total cost of revenues was $54.8 million in the third quarter of 2021, compared with $56.9 million in the same quarter of 2020. Cost for product sales was $54.0 million in the third quarter of 2021, compared with $53.9 million in the same quarter of 2020. Cost for service and others was $0.8 million in the third quarter of 2021, compared with $3.1 million in the same quarter of 2020.

Gross profit in the third quarter of 2021 was $43.9 million, compared with $43.1 million in the same quarter of 2020. Gross margin was 44.5% in the third quarter of 2021, compared with 43.1% in the same quarter of 2020. The increase in gross margin was a result of the Company's continuous efforts to optimize our product mix.

Total operating expenses in the third quarter of 2021 were $50.5 million, compared with $41.5 million in the same quarter of 2020.

  • Fulfillment expenses in the third quarter of 2021 were $7.2 million, compared with $6.7 million in the same quarter of 2020. As a percentage of total revenues, fulfillment expenses were 7.3% in the third quarter of 2021, compared with 6.7% in the same quarter of 2020 and 6.2% in the second quarter of 2021.

  • Selling and marketing expenses in the third quarter of 2021 were $34.0 million, compared with $26.9 million in the same quarter of 2020. As a percentage of total revenues, selling and marketing expenses were 34.4% for the third quarter of 2021, compared with 26.9% in the same quarter of 2020 and 35.6% in the second quarter of 2021.

  • G&A expenses in the third quarter of 2021 were $9.3 million, compared with $7.9 million in the same quarter of 2020. As a percentage of total revenues, G&A expenses were 9.4% for the third quarter of 2021, compared with 7.9% in the same quarter of 2020 and 7.8% in the second quarter of 2021. Included in G&A expenses, R&D expenses in the third quarter of 2021 were $5.5 million, compared with $3.5 million in the same quarter of 2020 and $5.1 million in the second quarter of 2021.

Loss from operations was $6.6 million in the third quarter of 2021, compared with income from operations of $1.6 million in the same quarter of 2020.

Other income, net in the third quarter of 2021 was $0.4 million, compared with $9.0 million in the same quarter of 2020. Included in other income, net in the third quarter of 2020, $8.9 million was derived from change in fair value on our equity investment. The gain in fair value change on our equity investment, after respective income tax of $3.2 million, was $5.7 million.

Net loss was $6.1 million in the third quarter of 2021, compared with net income of $7.3 million in the same quarter of 2020.

Net loss per American Depository Share ("ADS") was $0.05 in the third quarter of 2021, compared with net income per ADS of $0.07 in the same quarter of 2020. Each ADS represents two ordinary shares.

In the third quarter of 2021, the Company's basic weighted average number of ADSs used in computing the net income per ADS was 112,160,252.

Adjusted EBITDA, which represents income / (loss) from operations before share-based compensation expense, interest income, interest expense, income tax expense and depreciation and amortization expenses, was negative $5.1 million in the third quarter of 2021, compared with $12.7 million in the same quarter of 2020.

As of September 30, 2021, the Company had cash and cash equivalents and restricted cash of $50.2 million, compared with $65.5 million as of December 31, 2020.

First Nine Months of 2021 Financial Results

Total revenues increased by 25.5% year-over-year to $333.0 million from $265.4 million in the same period of 2020. Revenues generated from product sales were $324.7 million, compared with $252.6 million in the same period of 2020. Revenues from service and others were $8.2 million, compared with $12.8 million in the same period of 2020. Included in product sales, revenues from apparel increased by 105.1% to $196.3 million in the first nine months of 2021, compared with $95.7 million in the same period of 2020. Revenues from apparel represented 60.5% of total product sales in the first nine months of 2021, and 37.9% in the same period of 2020.

Total cost of revenues was $179.6 million in the first nine months of 2021, compared with $148.9 million in the same period of 2020. Cost for product sales was $177.0 million in the first nine months of 2021, compared with $139.7 million in the same period of 2020. Cost for service and others was $2.6 million in the first nine months of 2021, compared with $9.2 million in the same period of 2020.

Gross profit in the first nine months of 2021 was $153.3 million, compared with $116.5 million in the same period of 2020. Gross margin was 46.0% in the first nine months of 2021, compared with 43.9% in the same period of 2020. The increase in gross margin was a result of the Company's continuous efforts to drive revenues from product categories with higher margins.

Total operating expenses in the first nine months of 2021 were $161.9 million, compared with $110.0 million in the same period of 2020.

  • Fulfillment expenses in the first nine months of 2021 were $22.1 million, compared with $19.1 million in the same period of 2020. As a percentage of total revenues, fulfillment expenses were 6.6% in the first nine months of 2021, compared with 7.2% in the same period of 2020.

  • Selling and marketing expenses in the first nine months of 2021 were $113.1 million, compared with $68.2 million in the same period of 2020. As a percentage of total revenues, selling and marketing expenses were 34.0% for the first nine months of 2021, compared with 25.7% in the same period of 2020.

  • G&A expenses in the first nine months of 2021 were $27.2 million, compared with $22.7 million in the same period of 2020. As a percentage of total revenues, G&A expenses were 8.2% for the first nine months of 2021, compared with 8.6% in the same period of 2020. Included in G&A expenses, R&D expenses in the first nine months of 2021 were $15.5 million, compared with $10.4 million in the same period of 2020.

Loss from operations was $8.6 million in the first nine months of 2021, compared with income from operations of $6.6 million in the same period of 2020.

Other income, net was $17.6 million in the first nine months of 2021, compared with $13.2 million in the same period of 2020. Included in other income, net, change in fair value on our equity investment was $17.1 million in the first nine months of 2021, compared with $12.7 million in the same period of 2020. The gain in fair value change on our equity investment, after respective income tax of $4.3 million, was $12.8 million in the first nine months of 2021, compared with $9.5 million after respective income tax of $3.2 million in the same period of 2020.

Net income was $4.7 million in the first nine months of 2021, compared with $16.5 million in the same period of 2020.

Net income per American Depository Share ("ADS") was $0.04 in the first nine months of 2021, compared with $0.15 in the same period of 2020. Each ADS represents two ordinary shares. The diluted net income per ADS for the first nine months of 2021 was $0.04, compared with $0.15 in the same period of 2020.

In the first nine months of 2021, the Company's basic weighted average number of ADSs used in computing the net income per ADS was 112,110,030, and 113,307,665 in diluted weighted average number.

Adjusted EBITDA, which represents income from operations before share-based compensation expense, interest income, interest expense, income tax expense and depreciation and amortization expenses, was $11.7 million in the first nine months of 2021, compared with $23.3 million in the same period of 2020.

Non-GAAP Financial Measures

To supplement our consolidated financial statements, which are prepared and presented in accordance with U.S. GAAP, we use the following non-GAAP financial measures to help evaluate our operating performance:

"Adjusted EBITDA" represents income from operations before share-based compensation expense, interest income, interest expense, income tax expense and depreciation and amortization expenses. Although other companies may calculate adjusted EBITDA differently or not present it at all, we believe that the adjusted EBITDA helps to identify underlying trends in our operating results, and facilitate investors' understanding of the past performance and future prospect.

Conference Call

The Company will hold a conference call to discuss the results at 8:00 a.m. Eastern Time on December 2, 2021 (9:00 p.m. Beijing Time on the same day).

Preregistration Information

Participants can register for the conference call by navigating to http://apac.directeventreg.com/registration/event/5878276. Once preregistration has been completed, participants will receive dial-in numbers, an event passcode, and a unique registrant ID.

To join the conference, simply dial the number in the calendar invite you receive after preregistering, enter the event passcode followed by your unique registrant ID, and you will be joined to the conference instantly.

A telephone replay will be available two hours after the conclusion of the conference call through December 9, 2021. The dial-in details are:

US/Canada:

+1-855-452-5696

Hong Kong:

800-963-117

International:

+61-2-8199-0299

Passcode:

5878276

Additionally, a live and archived webcast of the conference call will be available on the Company's Investor Relations website at http://ir.lightinthebox.com.

About LightInTheBox Holding Co., Ltd.

LightInTheBox is a cross-border e-commerce platform that delivers products directly to consumers around the world. The Company offers customers a convenient way to shop for a wide selection of products at attractive prices through its www.lightinthebox.com, www.miniinthebox.com, www.ezbuy.sg and other websites and mobile applications, which are available in 25 major languages and cover more than 140 countries.

For more information, please visit www.lightinthebox.com.

Investor Relations Contact

Christensen
Ms. Xiaoyan Su
Tel: +86 (10) 5900 1548
Email: ir@lightinthebox.com

OR

Christensen
Ms. Linda Bergkamp
Tel: +1-480-614-3004
Email: lbergkamp@ChristensenIR.com

Forward-Looking Statements

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," "potential," "continue," "ongoing," "targets" and similar statements. Among other things, statements that are not historical facts, including statements about LightInTheBox's beliefs and expectations, the business outlook and quotations from management in this announcement, as well as LightInTheBox's strategic and operational plans, are or contain forward-looking statements.

LightInTheBox may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (the "SEC"), in press releases and other written materials and in oral statements made by its officers, directors or employees to fourth parties. 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: LightInTheBox's goals and strategies; LightInTheBox's future business development, results of operations and financial condition; the expected growth of the global online retail market; LightInTheBox's ability to attract customers and further enhance customer experience and product offerings; LightInTheBox's ability to strengthen its supply chain efficiency and optimize its logistics network; LightInTheBox's expectations regarding demand for and market acceptance of its products; competition; fluctuations in general economic and business conditions and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in LightInTheBox's filings with the SEC. All information provided in this press release and in the attachments is as of the date of this press release, and LightInTheBox does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

LightInTheBox Holding Co., Ltd.

Unaudited Condensed Consolidated Balance Sheets

(U.S. dollars in thousands, or otherwise noted)








As of December 31,


As of September 30,



2020


2021

ASSETS





Current Assets





Cash and cash equivalents


61,477


47,325

Restricted cash


4,052


2,870

Accounts receivable, net of allowance for doubtful accounts


1,302


497

Amounts due from related parties


2,882


2,762

Inventories


9,919


11,156

Prepaid expenses and other current assets


5,176


6,411

Total current assets


84,808


71,021

Property and equipment, net


3,812


3,461

Intangible assets, net


9,416


8,657

Goodwill


29,745


30,113

Operating lease right-of-use assets


12,243


8,530

Long-term rental deposits


707


781

Long-term investments


17,297


34,730

TOTAL ASSETS


158,028


157,293






LIABILITIES AND EQUITY





Current Liabilities





Accounts payable


16,953


17,444

Amounts due to related parties


167


167

Advance from customers


33,279


23,114

Operating lease liabilities


4,269


2,941

Accrued expenses and other current liabilities


42,183


44,648

Total current liabilities


96,851


88,314






Operating lease liabilities


8,118


5,817

Long-term payable


124


89

Deferred tax liability


3,558


7,907

TOTAL LIABILITIES


108,651


102,127






EQUITY





Ordinary shares


17


17

Additional paid-in capital


282,260


282,515

Treasury shares, at cost


(30,207)


(29,992)

Accumulated other comprehensive income


1,795


2,489

Accumulated deficit


(204,571)


(199,986)

Non-controlling interests


83


123

TOTAL EQUITY


49,377


55,166

TOTAL LIABILITIES AND EQUITY


158,028


157,293

LightInTheBox Holding Co., Ltd.

Unaudited Condensed Consolidated Statements of Operations

(U.S. dollars in thousands, except per share data, or otherwise noted)












Three Months Ended


Nine Months Ended



September 30,


September 30,


September 30,


September 30,

2020


2021

2020


2021

Revenues









Product sales


95,426


95,961


252,597


324,720

Services and others


4,584


2,744


12,809


8,233

Total revenues


100,010


98,705


265,406


332,953

Cost of revenues









Product sales


(53,857)


(54,018)


(139,726)


(177,051)

Services and others


(3,081)


(784)


(9,157)


(2,592)

Total Cost of revenues


(56,938)


(54,802)


(148,883)


(179,643)

Gross profit


43,072


43,903


116,523


153,310

Operating expenses









Fulfillment


(6,661)


(7,196)


(19,124)


(22,061)

Selling and marketing


(26,880)


(33,991)


(68,159)


(113,113)

General and administrative


(7,908)


(9,310)


(22,693)


(27,220)

Other operating income


(56)


37


16


445

Total operating expenses


(41,505)


(50,460)


(109,960)


(161,949)

Income / (Loss) from operations


1,567


(6,557)


6,563


(8,639)

Interest income


4


27


57


47

Interest expense


(35)


(3)


(78)


(11)

Other income, net*


8,960


368


13,174


17,577

Total other income


8,929


392


13,153


17,613

Income / (Loss) before income taxes


10,496


(6,165)


19,716


8,974

Income tax benefit / (expense)


(3,188)


29


(3,187)


(4,260)

Net income / (loss)


7,308


(6,136)


16,529


4,714

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


(98)


(121)


20


40

Net income / (loss) attributable to LightInTheBox
Holding Co., Ltd.


7,406


(6,015)


16,509


4,674










Weighted average numbers of shares used in calculating
income / (loss) per ordinary share









—Basic


220,599,987


224,320,504


217,124,431


224,220,060

—Diluted


223,820,121


224,320,504


224,779,416


226,615,330










Net income / (loss) per ordinary share









—Basic


0.03


(0.03)


0.08


0.02

—Diluted


0.03


(0.03)


0.07


0.02










Net income / (loss) per ADS (2 ordinary shares equal to
1 ADS)









—Basic


0.07


(0.05)


0.15


0.04

—Diluted


0.07


(0.05)


0.15


0.04



















*Other income, net mainly includes change in fair value on our equity investment.

LightInTheBox Holding Co., Ltd.

Unaudited Reconciliations of GAAP and Non-GAAP Results

(U.S. dollars in thousands, or otherwise noted)












Three Months Ended


Nine Months Ended



September 30,


September 30,


September 30,


September 30,

2020


2021

2020


2021










Net income / (loss)


7,308


(6,136)


16,529


4,714










Less: Interest income


4


27


57


47

Interest expense


(35)


(3)


(78)


(11)

Income tax benefit / (expense)


(3,188)


29


(3,187)


(4,260)

Depreciation and amortization


(633)


(990)


(1,770)


(2,482)

EBITDA


11,160


(5,199)


21,507


11,420










Less: Share-based compensation


(1,525)


(57)


(1,754)


(255)

Adjusted EBITDA*


12,685


(5,142)


23,261


11,675



















* Adjusted EBITDA represents income from operations before share-based compensation expense, interest income, interest expense, income tax expense and depreciation and
amortization expenses.

Cision
Cision

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SOURCE LightInTheBox Holding Co., Ltd.