Secoo Holding (SECO) Misses Q2 EPS by 2c, Revenues Beat

Secoo Holding (NASDAQ: SECO) reported Q2 EPS of $0.12, $0.02 worse than the analyst estimate of $0.14. Revenue for the quarter came in at $184.4 million versus the consensus estimate of $163.78 million.

• GMV1 reached RMB1,653.4 million (US$249.9 million) for Q2 2018, representing an increase of 44.7% from RMB1,142.6 million for Q2 2017.
• Total number of orders2 was 455.9 thousand for Q2 2018, representing an increase of 49.7% from 304.6 thousand for Q2 2017.
• Number of active customers3 increased by 97.6% to 255.5 thousand for Q2 2018 from 129.3 thousand for Q2 2017.
• Total net revenues reached RMB1,220.1 million (US$184.4 million) for Q2 2018, increasing by 55.5 % from RMB784.7 million in Q2 2017.
• Gross margin was 18.3% for Q2 2018, compared to 16.5% in Q2 2017.
• Net income increased by 26.4% to RMB36.4 million (US$5.5 million) for Q2 2018 from RMB28.8 million for Q2 2017.
• Non-GAAP net income4 increased by 42.4% to RMB41.0 million (US$6.2 million) for Q2 2018 from RMB28.8 million in Q2 2017.
• Basic and diluted net income per share was RMB1.42 (US$0.21) and RMB1.36 (US$0.21), respectively, for Q2 2018, compared to RMB18.93 and RMB6.75, respectively, for Q2 2017. Basic and diluted net income per American Depositary Share ("ADS") was RMB0.71 (US$0.11) and RMB0.68 (US$0.10), respectively, for Q2 2018, compared to RMB9.47 and RMB3.38, respectively, for Q2 2017. Two ADSs represent one ordinary share.
• Basic and diluted non-GAAP net income per share5 was RMB1.62 (US$0.24) and RMB1.56 (US$0.24), respectively, for Q2 2018, compared to RMB3.84 and RMB1.37, respectively, for Q2 2017. Basic and diluted non-GAAP net income per ADS was RMB0.81 (US$0.12) and RMB0.78 (US$0.12), respectively, for Q2 2018, compared to RMB1.92 and RMB0.68, respectively, for Q2 2017.

Mr. Richard Rixue Li, Chairman and Chief Executive Officer of Secoo, said, “We are pleased to continue our strong growth momentum in the second quarter of 2018, highlighted by year-over-year growth in total revenues and GMV of 55.5% and 44.7%, respectively. Our robust results in the second quarter of this year reaffirm our leading position in the Chinese online luxury products and services industry and reflect our achievements to continuously improve the shopping experience on Secoo’s integrated online and offline platforms through a broadened spectrum of upscale products and services and strengthened technological capabilities.

“We remain committed to establishing solid relationships with leading partners to increase our brand awareness and further strengthen Secoo’s leading position in the sector. Notably, we’re thrilled about the recently disclosed investments from L Catterton and JD, along with business collaboration opportunities with these leaders in the world’s consumers, luxury and e-commerce spaces,” continued Mr. Li. “During the second quarter, a significant number of additional well-known fashion and luxury brands joined our integrated online and offline platforms, a further testament to the unique value that Secoo brings to brands targeting China’s luxury consumers. As China’s luxury market continues to drive the global luxury market, we’re confident through our strategic alliances and the superior shopping experience we create for our premium customers position, Secoo will gain even greater industry recognition, attract even more leading fashion brands to our platform and further capture the rising demand for high-end products and services among Chinese consumers. Our multipronged business strategy positions us well to deliver strong growth in the immediate future and over the long run.”

“As we continue to move our expansion strategy forward, we are pleased with our operational and financial performance for the second quarter of 2018, which continued to demonstrate our solid growth trajectory,” said Mr. Shaojun Chen, Chief Financial Officer of Secoo. “During the second quarter, we realized net revenues of RMB1,220.1 million and grew gross margin by 180 basis points from the same period last year. We maintained our focus on improving operating efficiencies and increasing profitability and achieved non-GAAP net income growth of 42.4% year-over-year. As we continue to pursue strong organic growth pathways and explore valuable partnerships that enhance our suite of offerings and strengthen our brand, we anticipate continued top- and bottom-line growth in the coming quarters.”

For earnings history and earnings-related data on Secoo Holding (SECO) click here.

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