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 second quarter ended June 30, 2021.
Second Quarter and First Half 2021 Financial Highlights
Mr. Jian He, Chief Executive Officer of LightInTheBox, commented, “During the quarter, we continued to deliver healthy financial results. Total revenues increased to $122.2 million in the second quarter of 2021, compared with $113.9 million in the same quarter of 2020. We are facing more and more players in the highly competitive e-commerce market and the impact of COVID-19 and the resulting macro-economic uncertainties continue to pose challenges in certain overseas markets. In the long term, we believe that we are well positioned to adapt to changes in highly competitive markets by staying on course with our values and going beyond our customers’ expectations as a comprehensive and reliable shopping destination.”
Second Quarter 2021 Financial Results
Total revenues increased by 7.3% year-over-year to $122.2 million from $113.9 million in the same quarter of 2020. Revenues generated from product sales were $119.3 million, compared with $107.2 million in the same quarter of 2020. Revenues from service and others were $2.9 million, compared with $6.7 million in the same quarter of 2020. Included in product sales, revenues from apparel increased by 149% to $74.0 million in the second quarter of 2021, compared with $29.7 million in the same quarter of 2020.
Total cost of revenues was $65.1 million in the second quarter of 2021, compared with $64.3 million in the same quarter of 2020. Cost for product sales was $64.0 million in the second quarter of 2021, compared with $59.0 million in the same quarter of 2020. Cost for service and others was $1.1 million in the second quarter of 2021, compared with $5.3 million in the same quarter of 2020.
Gross profit in the second quarter of 2021 was $57.1 million, compared with $49.6 million in the same quarter of 2020. Gross margin was 46.8% in the second quarter of 2021, compared with 43.5% in the same quarter of 2020. The increase in gross margin was a result of the Company’s continuous efforts to optimize the supply chain and product mix.
Total operating expenses in the second quarter of 2021 were $60.6 million, compared with $41.4 million in the same quarter of 2020.
- Fulfillment expenses in the second quarter of 2021 were $7.6 million, compared with $7.4 million in the same quarter of 2020. As a percentage of total revenues, fulfillment expenses were 6.2% in the second quarter of 2021, compared with 6.5% in the same quarter of 2020 and 6.5% in the first quarter of 2021.
- Selling and marketing expenses in the second quarter of 2021 were $43.5 million, compared with $26.5 million in the same quarter of 2020. As a percentage of total revenues, selling and marketing expenses were 35.6% for the second quarter of 2021, compared with 23.3% in the same quarter of 2020 and 31.8% in the first quarter of 2021.
- G&A expenses in the second quarter of 2021 were $9.5 million, compared with $7.5 million in the same quarter of 2020. As a percentage of total revenues, G&A expenses were 7.8% for the second quarter of 2021, compared with 6.6% in the same quarter of 2020 and 7.5% in the first quarter of 2021. Included in G&A expenses, R&D expenses in the second quarter of 2021 were $5.1 million, compared with $3.3 million in the same quarter of 2020 and $4.9 million in the first quarter of 2021.
Loss from operations was $3.5 million in the second quarter of 2021, compared with income from operations of $8.2 million in the same quarter of 2020.
Other income, net in the second quarter of 2021 was $17.2 million, compared with $0.3 million in the same quarter of 2020. Included in other income, net in the second quarter of 2021, $17.1 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 $4.2 million, was $12.9 million.
Net income was $9.5 million in the second quarter of 2021, compared with $8.5 million in the same quarter of 2020.
Net income per American Depository Share (“ADS”) was $0.08 in the second quarter of 2021, compared with $0.08 in the same quarter of 2020. Each ADS represents two ordinary shares. Diluted net income per ADS was $0.08 in the second quarter of 2021, compared with $0.08 in the same quarter of 2020.
In the second quarter of 2021, the Company’s basic weighted average number of ADSs used in computing the net income per ADS was 112,099,326 and the diluted weighted average number of ADSs was 113,372,055.
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 $14.5 million in the second quarter of 2021, compared with $9.1 million in the same quarter of 2020.
As of June 30, 2021, the Company had cash and cash equivalents and restricted cash of $58.2 million, compared with $65.5 million as of December 31, 2020.
First Half 2021 Financial Results
Total revenues increased by 41.6% year-over-year to $234.2 million from $165.4 million in the same half of 2020. Revenues generated from product sales were $228.7 million, compared with $157.2 million in the same half of 2020. Revenues from service and others were $5.5 million, compared with $8.2 million in the same half of 2020. Included in product sales, revenues from apparel increased by 156% to $131.6 million in the first half of 2021, compared with $51.4 million in the same half of 2020.
Total cost of revenues was $124.8 million in the first half of 2021, compared with $91.9 million in the same half of 2020. Cost for product sales was $123.0 million in the first half of 2021, compared with $85.9 million in the same half of 2020. Cost for service and others was $1.8 million in the first half of 2021, compared with $6.0 million in the same half of 2020.
Gross profit in the first half of 2021 was $109.4 million, compared with $73.5 million in the same half of 2020. Gross margin was 46.7% in the first half of 2021, compared with 44.4% in the same half 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 half of 2021 were $111.5 million, compared with $68.5 million in the same half of 2020.
- Fulfillment expenses in the first half of 2021 were $14.9 million, compared with $12.4 million in the same half of 2020. As a percentage of total revenues, fulfillment expenses were 6.3% in the first half of 2021, compared with 7.5% in the same half of 2020.
- Selling and marketing expenses in the first half of 2021 were $79.1 million, compared with $41.3 million in the same half of 2020. As a percentage of total revenues, selling and marketing expenses were 33.8% for the first half of 2021, compared with 25.0% in the same half of 2020.
- G&A expenses in the first half of 2021 were $17.9 million, compared with $14.8 million in the same half of 2020. As a percentage of total revenues, G&A expenses were 7.6% for the first half of 2021, compared with 8.9% in the same half of 2020. Included in G&A expenses, R&D expenses in the first half of 2021 were $10.0 million, compared with $6.8 million in the same half of 2020.
Loss from operations was $2.1 million in the first half of 2021, compared with income from operations of $5.0 million in the same half of 2020.
Other income, net was $17.2 million in the first half of 2021, compared with $4.2 million in the same half of 2020. Included in other income, net, change in fair value on our equity investment was $17.1 million in the first half of 2021, compared with $3.8 million in the same half of 2020. The gain in fair value change on our equity investment, after respective income tax of $4.2 million, was $12.9 million in the first half of 2021.
Net income was $10.9 million in the first half of 2021, compared with $9.2 million in the same half of 2020.
Net income per American Depository Share (“ADS”) was $0.10 in the first half of 2021, compared with $0.09 in the same half of 2020. Each ADS represents two ordinary shares. The diluted net income per ADS for the first half of 2021 was $0.09, compared with $0.08 in the same half of 2020.
In the first half of 2021, the Company’s basic weighted average number of ADSs used in computing the net income per ADS was 112,076,570, and 113,402,531 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 $16.8 million in the first half of 2021, compared with $10.6 million in the same half 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 September 7, 2021 (8:00 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/3376424. Once preregistration has been complete, 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 September 14, 2021. The dial-in details are:
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