Boqii Announces Fiscal 2022 Third Quarter Unaudited Financial Results

Boqii Holding Limited (“Boqii” or the “Company”) (NYSE: BQ), a leading pet-focused platform in China, today announced its unaudited financial results for the third quarter of fiscal year 2022 (the quarter ended December 31, 2021).

Fiscal Q3 2022 Operational and Financial Highlights

  • Total revenues were RMB 332.6 million (US$ 52.2 million), representing an increase of 6.3% from RMB312.9 million in the same quarter of fiscal year 2021.
  • Net loss was RMB28.8 million (US$4.5 million), representing an improvement from net loss of RMB81.9 million in the same quarter of fiscal year 2021.
  • Adjusted net loss was RMB25.4 million (US$4.0 million), representing an improvement from adjusted net loss of RMB30.5 million in the same quarter of fiscal year 2021.
  • EBITDA[1] was a loss of RMB25.6 million (US$4.0 million), representing an improvement from a loss of RMB79.2 million in the same quarter of fiscal year 2021.
  • Total GMV[2] was RMB816.5 million (US$128.1 million), representing an increase of 6.9% from RMB763.8 million in the same quarter of fiscal year 2021.
  • Active buyers were 1.9 million, representing an increase of 26.3% from 1.5 million in the same quarter of fiscal year 2021.

[1]EBITDA refers to net loss excluding income tax expenses, interest expense, interest income, depreciation and amortization expenses. EBITDA is a Non-GAAP financial measurement. Please refer to “Non-GAAP financial measurement”.

[2]GMV refers to gross merchandise volume, which is the total value of confirmed orders placed with us and sold through distribution model or drop shipping model where we act as a principal in the transaction regardless of whether the products are delivered or returned, calculated based on the listed prices of the ordered products without taking into consideration any discounts. The total GMV amount (i) includes GMV of products sold by Xingmu, (ii) excludes products sold through consignment model and (iii) excludes the value of services offered by us. GMV is subject to future adjustments (such as refunds) and represents only one measure of the Company’s performance and should not be relied on as an indicator of our financial results, which depend on a variety of factors.

CEO & CFO Quote

Mr. Hao Liang, Boqii’s Founder, Chairman and Chief Executive Officer commented, “We maintained continuous topline growth in the third fiscal quarter of 2022 amidst challenging market conditions. On top of that, we are pleased to report fast-improving profit margins, highlighting the progress we made in achieving profitability. We also announced a strategic partnership with Evetsoft Pet Hospital Software and furthered our pet care supply chain readiness, to provide pets with better care at more accessible price points.”

Ms. Yingzhi (Lisa) Tang, Boqii’s Co-Founder, Co-CEO and CFO commented: “Continuous growth momentum from online marketing, information services, and other revenue once again exhibited the strength of our vertical platform and unique value propositions to other players in the industry chain. Our improved gross margin also demonstrated our ability to achieve profitability. We are committed to bringing the best-in-class products and services closer to our ever-increasing customer base and industry partners, to capture the enormous opportunities in the pet industry.”

Fiscal Q3 2022 Financial Results

Total revenues were RMB332.6 million (US$52.2 million), representing an increase of 6.3% from RMB312.9 million in the same quarter of fiscal year 2021. The increase was primarily due to the continued organic growth of our business.

Revenues
(in million)

Three Months Ended

December 31

%

2021

2020

change

RMB

RMB

YoY

Product sales

317.4

312.3

1.6%

·         Boqii Mall

121.3

114.1

6.3%

·         Third party e-commerce platforms

196.1

198.2

(1.1%)

Online marketing and information services and other revenue

15.2

0.6

2433.3%

Total

322.6

312.9

6.3%

 

Gross profit was RMB76.9 million (US$12.1 million), representing an increase of 37% from RMB56.1 million in the same quarter of fiscal year 2021.

Gross margin was 23.1%, representing an increase from 17.9% in the same quarter of fiscal year 2021.

Operating expenses were RMB108.2 million, representing a decrease of 28.1% from RMB150.5 million in the same quarter of fiscal year 2021. Operating expenses as a percentage of total revenues was 32.5%, representing a decrease from 48.1% in the same quarter of fiscal year 2021. The decrease was primarily due to share-based compensation expenses incurred in fiscal year 2021. Pursuant to the Amended and Restated 2018 Global Share Plan, the performance condition for options granted thereunder was satisfied upon completion of our IPO; and as a result, the company, upon the completion of the IPO, recorded RMB44.1 million of cumulative share-based compensation expenses for those options for which the vesting conditions had been satisfied as of such date.

  • Fulfillment Expenses were RMB37.7 million, representing an increase of 12.2% from RMB33.6 million in the same quarter of fiscal year 2021. Fulfillment expenses as a percentage of total revenues was 11.3%, compared to 10.7% in the same quarter of fiscal year 2021. The increase was primarily due to the increased handling expenses and packaging cost.
  • Sales and marketing expenses were RMB48.3 million, representing a decrease of 12.4% from RMB55.1 million in the same quarter of fiscal year 2021. Sales and marketing expenses as a percentage of total revenue was 14.5%, representing a decrease from 17.6% in the same quarter of fiscal year 2021. The decrease was primarily due to the decrease of share-based compensation expense of RMB11.4 million compared with the same quarter of fiscal year 2021.
  • General and administrative expenses were RMB22.3 million, representing a decrease of 64% from RMB61.8 million in the same quarter of fiscal year 2021. General and administrative expenses as a percentage of total revenue was 6.7%, representing a decrease from 19.8% in the same quarter of fiscal year 2021. The decrease was primarily due to: (i) the decrease of share-based compensation expense of RMB35.7 million compared with the same quarter of fiscal year 2021; (ii) the decrease of professional fees of RMB3.9 million incurred in connection with our IPO in the same quarter of fiscal year 2021.

Operating loss was RMB31.3 million (US$4.9 million), representing an improvement from a loss of RMB93.6 million in the same quarter of fiscal year 2021.

EBITDA was a loss of RMB25.6 million (US$4.0 million), representing an improvement from a loss of RMB79.2 million in the same quarter of fiscal year 2021.

Net loss was RMB28.8 million (US$4.5 million), representing an improvement from to net loss of RMB81.9 million in the same quarter of fiscal year 2021.

Adjusted net loss was RMB25.4 million (US$4.0 million), representing an improvement from adjusted net loss of RMB30.5 million in the same quarter of fiscal year 2021.

Diluted net loss per share was RMB0.41 (US$0.06), representing an improvement from diluted net loss per share of RMB1.61 in the same quarter of fiscal year 2021.

Total cash and cash equivalents and short-term investments were RMB315.7 million (US$49.5 million), compared to RMB339.4 million as of September 30, 2021.

Conference Call

Boqii’s management will hold a conference call to discuss the financial results at 8:00 AM on Wednesday, March 3, 2022, U.S. Eastern Time (9:00 PM on Wednesday, March 3, 2022Beijing/Hong Kong Time).

 

Phone Number

International

1-412-317-6061

United States

1-888-317-6003

Hong Kong

852 800-963976

Mainland China

86 4001-206115

Passcode

9147363

A replay of the conference call may be accessed by phone at the following numbers until March 10, 2022.

Phone Number

International

1-412-317-0088

United States

1-877-344-7529

Replay Access Code

8462589

 

A live and archived webcast of the conference call will be available on the Company’s investor relations website at http://ir.boqii.com/.

Boqii Holding Limited

Unaudited Consolidated Balance Sheets

(In thousands, except share and per share data)

As of
March 31,
2021

As of
December 31,
2021

As of

December 31,
2021

RMB

RMB

US$

ASSETS

Current assets:

Cash and cash equivalents

292,237

176,026

27,622

Short-term investments

168,546

139,648

21,914

Accounts receivable, net

45,732

53,991

8,472

Inventories, net

91,551

123,316

19,351

Prepayments and other current assets

85,261

106,650

16,736

Amounts due from related parties

11,465

23,430

3,677

Total current assets

694,792

623,061

97,772

Non-current assets:

Property and equipment, net

8,386

7,403

1,162

Intangible assets

29,537

26,544

4,165

Operating lease right-of-use assets

29,234

42,065

6,601

Long-term investments

74,330

94,887

14,890

Goodwill

40,184

40,684

6,384

Other non-current asset

4,111

4,140

650

Total non-current assets

185,782

215,723

33,852

Total assets

880,574

838,784

131,624

LIABILITIES, MEZZANINE EQUITY AND SHAREHOLDERS’ DEFICIT

Current liabilities

Short-term borrowings

85,566

152,426

23,919

Accounts payable

71,848

100,235

15,729

Salary and welfare payable

6,309

8,619

1,353

Accrued liabilities and other current liabilities

30,055

35,474

5,567

Amounts due to related parties, current

910

9,981

1,566

Contract liabilities

3,866

10,534

1,653

Operating lease liabilities, current

8,063

10,197

1,600

Derivative liabilities

9,996

9,635

1,512

Total current liabilities

216,613

337,101

52,899

Non-current liabilities

Deferred tax liabilities

8,958

8,216

1,289

Operating lease liabilities, non-current

19,997

30,565

4,796

Long-term borrowings

68,075

Other debts, non-current

433,292

251,141

39,410

Total non-current liabilities

530,322

289,922

45,495

Total liabilities

746,935

627,023

98,394

Mezzanine equity

Redeemable non-controlling interests

5,946

6,374

1,000

Total mezzanine equity

5,946

6,374

1,000

Stockholders’ equity:

Class A ordinary shares (US$0.001 par value; 129,500,000 shares authorized, 54,505,108 and 55,703,708 shares issued and outstanding as of March 31 and December 31, 2021, respectively)

364

372

58

Class B ordinary shares (US$0.001 par value; 15,000,000 shares authorized, 13,037,729 shares issued and outstanding as of March 31 and December, 31, 2021, respectively)

82

82

13

Additional paid-in capital

3,272,612

3,295,010

517,059

Statutory reserves

3,047

3,203

503

Accumulated other comprehensive loss

(20,172)

(33,675)

(5,284)

Accumulated deficit

(2,759,882)

(2,866,435)

(449,807)

Receivable for issuance of ordinary shares

(413,377)

(235,556)

(36,964)

Total Boqii Holding Limited shareholders’ equity

82,674

163,001

25,578

Non-controlling interests

45,019

42,386

6,652

Total shareholders’ equity

127,693

205,387

32,230

Total liabilities, mezzanine equity and shareholders’ equity

880,574

838,784

131,624

Boqii Holding Limited

UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(All amounts in thousands, except for share and per share data, unless otherwise noted)

Three Months Ended December 31,

Nine Months Ended December 31,

2020

2021

2021

2020

2021

2021

RMB

RMB

US$

RMB

RMB

US$

Net revenues:

Product sales

312,371

317,439

49,813

778,186

895,022

140,449

Online marketing and information services

555

15,166

2,380

2,368

41,550

6,520

Total revenues

312,926

332,605

52,193

780,554

936,572

146,969

Total cost of revenue

(256,784)

(255,686)

(40,123)

(638,507)

(747,566)

(117,309)

Gross profit

56,142

76,919

12,070

142,047

189,006

29,659

Operating expenses:

Fulfillment expenses

(33,557)

(37,655)

(5,909)

(96,225)

(100,174)

(15,719)

Sales and marketing expenses

(55,107)

(48,257)

(7,573)

(121,393)

(137,711)

(21,610)

General and administrative expenses

(61,811)

(22,282)

(3,497)

(95,376)

(65,056)

(10,209)

Other income, net

740

20

3

1,045

87

14

Loss from operations

(93,593)

(31,255)

(4,906)

(169,902)

(113,848)

(17,865)

Interest income

5,471

3,470

545

11,674

13,334

2,092

Interest expense

(6,990)

(4,935)

(774)

(20,549)

(16,994)

(2,667)

Other (losses)/gain, net

12,552

3,254

511

16,328

3,659

574

Fair value change of derivative liabilities

920

144

10,409

1,331

209

Loss before income tax expenses

(82,560)

(28,546)

(4,480)

(152,040)

(112,518)

(17,657)

Income taxes expenses

603

159

25

412

1,406

221

Share of results of equity investees

22

(382)

(60)

(55)

452

71

Net loss

(81,935)

(28,769)

(4,515)

(151,683)

(110,660)

(17,365)

Less: Net income/(loss) attributable to the non-controlling interest shareholders

1,242

(1,011)

(159)

2,138

(4,694)

(737)

Net loss attributable to Boqii Holding Limited

(83,177)

(27,758)

(4,356)

(153,821)

(105,966)

(16,628)

Less: Accretion on convertible redeemable preferred shares to redemption value

195,935

120,873

Less: Accretion on redeemable non-controlling interests to redemption value

(145)

(23)

(428)

(67)

Less: Deemed dividend to preferred shareholders

(12,547)

Net income/(loss) attributable to Boqii Holding Limited‘s ordinary shareholders

112,758

(27,903)

(4,379)

(45,495)

(106,394)

(16,696)

Net loss

(81,935)

(28,769)

(4,515)

(151,683)

(110,660)

(17,365)

Other comprehensive loss:

Foreign currency translation adjustment, net of nil tax

(24,062)

(7,738)

(1,214)

(35,579)

(13,503)

(2,119)

Unrealized securities holding gains

1,195

Total comprehensive loss

(105,997)

(36,507)

(5,729)

(186,067)

(124,163)

(19,484)

Less: Total comprehensive income/(loss) attributable to non-controlling interest shareholders

1,242

(1,011)

(159)

2,138

(4,694)

(737)

Total comprehensive loss attributable to Boqii Holding Limited

(107,239)

(35,496)

(5,570)

(188,205)

(119,469)

(18,747)

Net earnings/(loss) per share attributable to Boqii Holding Limited’s ordinary shareholders

— basic

1.68

(0.41)

(0.06)

(0.68)

(1.57)

(0.25)

— diluted

1.61

(0.41)

(0.06)

(0.68)

(1.57)

(0.25)

Weighted average number of ordinary shares 

— basic

67,156,580

67,861,419

67,861,419

67,156,580

67,735,744

67,735,744

— diluted

70,041,375

67,861,419

67,861,419

67,156,580

67,735,744

67,735,744

Boqii Holding Limited

Reconciliation of  GAAP and Non-GAAP Results

(In thousands, except % and per share data)

Three Months Ended
December 31, 2020

Three Months Ended
December 31, 2021

Nine Months Ended
December 31, 2020

Nine Months Ended
December 31, 2021

Net loss

(81,935)

(28,769)

(151,683)

(110,660)

Fair value change of derivative liabilities

(920)

(10,409)

(1,331)

Share-based compensation

51,422

4,312

51,422

14,215

Adjusted Net Loss

(30,513)

(25,377)

(110,670)

(97,776)

Adjusted Net Loss Margin

(9.8%)

(7.6%)

(14.2%)

(10.4%)

Three Months Ended
December 31, 2020

Three Months Ended
December 31, 2021

Nine Months Ended
December 31, 2020

Nine Months Ended
December 31, 2021

Net loss

(81,935)

(28,769)

(151,683)

(110,660)

Income tax expenses

(603)

(159)

(412)

(1,406)

Interest expenses

6,990

4,935

20,549

16,994

Interest income

(5,471)

(3,470)

(11,674)

(13,334)

Depreciation and amortization .

1,784

1,905

5,135

5,790

EBITDA

(79,235)

(25,558)

(138,085)

(102,616)

EBITDA Margin

(25.3%)

(7.7%)

(17.7%)

(11.0%)

Notes for all the condensed consolidated financial schedules presented:

Note 1: The conversion of Renminbi (RMB) into U.S. dollars (USD) is based on the certified exchange rate of USD1.00=RMB6.3726 on December 31, 2021 published by the Federal Reserve Board.

 

Source: Boqii Holding Limited