BEST Inc (BEST) Misses Q3 EPS by 17c, Revenues Miss

BEST Inc (NYSE: BEST) reported Q3 EPS of ($0.23), $0.17 worse than the analyst estimate of ($0.06). Revenue for the quarter came in at $1.28 billion versus the consensus estimate of $1.37 billion.

For the Quarter Ended September 30, 2020:

• Revenue was RMB8,693.3 million (US$1,280.4 million), a decrease of 0.6% year-over-year ("YoY"). The decrease was primarily due to a decrease in average selling price ("ASP") of Express business, partially offset by an increase in Express volume.
• Gross Profit was RMB37.6 million (US$5.5 million), a decrease of 92.6% YoY compared to gross profit of RMB507.1 million in the same period of 2019. The decrease was primarily due to decreased ASP and increased costs of Express and Freight units. Gross Margin was 0.4%, a decrease of 5.4 percentage points ("ppts") YoY.
• Net Loss was RMB639.5 million (US$94.2 million), compared to a net loss of RMB6.7 million in the same period of 2019. Non-GAAP Net Loss[2] [3] was RMB612.0 million (US$90.1 million), compared to non-GAAP Net Income of RMB16.7 million in the same period of 2019.
• Diluted EPS[4] was negative RMB1.64 (US$0.24), compared to negative RMB0.01 in the same period of 2019. Non-GAAP diluted EPS[3] [5] was negative RMB1.57 (US$0.23), compared to RMB0.05 in the same period of 2019.
• EBITDA[3] [6] was negative RMB462.9 million (US$68.2 million), compared to RMB93.4 million in the same period of 2019. Adjusted EBITDA[3] [6] was negative RMB437.7 million (US$64.5 million), compared to RMB114.3 million in the same period of 2019.

Johnny Chou, Founder, Chairman and Chief Executive Officer of BEST, commented, "We had a challenging third quarter amid intensified industry competition. Our Express segment execution did not meet the fast-changing market dynamics in both operation and pricing strategy, which led to lower volume growth and margin. Facing strong industry headwinds, we are taking steps to make major strategic adjustments and organizational changes to our business, focusing on our core logistics and supply chain management businesses, emphasizing service quality, enhancing operating efficiency, with the goal of putting us back on a path to profitability."

Gloria Fan, BEST's Chief Financial Officer, commented, "Our third-quarter performance reflects both the challenges and resiliency of our business. Revenue was RMB8.7 billion, relatively stable compared with the same period last year, while our gross margin contracted 5.4 percentage points year-over-year due to a challenging pricing environment that offset our volume growth across multiple business units, resulting in a net loss of RMB640 million. Despite the net loss, we generated net operating cash inflow of RMB115 million during the third quarter and maintained a healthy balance of cash and cash equivalents, restricted cash and short-term investments of RMB4.8 billion."

For earnings history and earnings-related data on BEST Inc (BEST) click here.

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