Form 6-K 21Vianet Group, Inc. For: Mar 31

March 23, 2021 5:01 PM EDT

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 


 

FORM 6-K

 


 

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 UNDER

THE SECURITIES EXCHANGE ACT OF 1934

 

For the month of March 2021

 

Commission File Number: 001-35126

 


 

21Vianet Group, Inc.

 


 

Guanjie Building, Southeast 1st Floor
10# Jiuxianqiao East Road

Chaoyang District

Beijing 100016

The People’s Republic of China

(Address of principal executive office)

 


 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

 

Form 20-F  x            Form 40-F  o

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):  o

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):  o

 

 

 


 

EXPLANATORY NOTE

 

Exhibit 99.1 to this Current Report on Form 6-K is hereby incorporated by reference into the Registration Statement on Form F-3 of 21Vianet Group, Inc. (File No. 333-240044) and shall form a part thereof from the date on which this Current Report is furnished, to the extent not superseded by documents or reports subsequently filed or furnished.

 

2


 

EXHIBIT INDEX

 

Exhibit No.

 

Description

 

 

 

99.1

 

Press Release

 

3


 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

 

21Vianet Group, Inc.

 

 

 

 

 

 

 

By

/s/ Sharon Xiao Liu

 

Name:

Sharon Xiao Liu

 

Title:

Chief Financial Officer

 

Date: March 23, 2021

 

4


Exhibit 99.1

 

 

21Vianet Group, Inc. Reports Unaudited Fourth Quarter and Full Year 2020 Financial Results

 

BEIJING, March 23, 2021 (GLOBE NEWSWIRE) — 21Vianet Group, Inc. (Nasdaq: VNET) (“21Vianet” or the “Company”), a leading carrier- and cloud-neutral Internet data center services provider in China, today announced its unaudited financial results for the fourth quarter ended December 31, 2020. The Company will hold a conference call at 8:30 P.M. on Tuesday, March 23, 2021, U.S. Eastern Time to discuss the financial results. Dial-in details are provided at the end of this release.

 

Fourth Quarter 2020 Financial Highlights

 

·                  Net revenues increased by 28.6% to RMB1.35 billion (US$206.6 million) from RMB1.05 billion in the same period of 2019.

 

·                  Adjusted cash gross profit (non-GAAP) increased by 36.6% to RMB581.9 million (US$89.2 million) from RMB425.9 million in the same period of 2019. Adjusted cash gross margin (non-GAAP) was 43.2%, compared to 40.6% in the same period of 2019.

 

·                  Adjusted EBITDA (non-GAAP) increased by 47.7% to RMB389.8 million (US$59.7 million) from RMB263.8 million in the same period of 2019. Adjusted EBITDA margin (non-GAAP) was 28.9%, compared to 25.2% in the same period of 2019.

 

Full Year 2020 Financial Highlights

 

·                  Net revenues increased by 27.4% to RMB4.83 billion (US$740.1 million) from RMB3.79 billion in the full year of 2019.

 

·                  Adjusted cash gross profit (non-GAAP) increased by 22.0% to RMB1.99 billion (US$305.4 million) from RMB1.63 billion in the full year of 2019. Adjusted cash gross margin (non-GAAP) was 41.3%, compared to 43.1% in the full year of 2019.

 

·                  Adjusted EBITDA (non-GAAP) increased by 26.0% to RMB1.32 billion (US$202.9 million) from RMB1.05 billion in the full year of 2019. Adjusted EBITDA margin (non-GAAP) was 27.4%, compared to 27.7% in the full year of 2019.

 

Fourth Quarter 2020 Operational Highlights

 

·                  Total cabinets under management net increased by 2,077 to 53,553 as of December 31, 2020, compared to 51,476 as of September 30, 2020, and 36,291 as of December 31, 2019.

 

·                  Retail IDC MRR1 per cabinet increased to RMB9,131 in the fourth quarter of 2020, compared to RMB8,822 in the same period of 2019 and RMB9,074 in the third quarter of 2020.

 

·                  Compound utilization rate was 60.4%, compared to 64.2% in the third quarter of 2020.

 

·                  Utilization rate for mature IDCs delivered prior to 2019 was 77.8%, compared to 77.0% in the third quarter of 2020.

 

·                  Utilization rate for ramp-up and newly-built IDCs was 31.7%, compared to 35.9% in the third quarter of 2020.

 


1 Retail IDC MRR: Refers to Monthly Recurring Revenues for the retail IDC business.

 


 

Mr. Samuel Shen, Chief Executive Officer and Executive Chairman of Retail IDC, stated, “We delivered robust financial and operating results in the fourth quarter and full year of 2020 due to the growing market demand as well as our methodical resource expansion, meticulous customer service, and strong sales momentum. During the quarter, we remained committed to expanding our capacity pipeline and growing our resources. We acquired a data center in Beijing which is already under commitment to a public cloud customer. We were able to secure additional wholesale demand in recent months and accumulated our MOU in service or under contract to 180 MW. We are currently preparing an initial ESG report and plan to publish it later this year, to keep in line with our commitment to transparency around our corporate sustainability practices, and to ensure our environmental sustainability while executing expansion initiatives going forward.”

 

Ms. Sharon Liu, Chief Financial Officer of the Company, commented, “In the fourth quarter and full year of 2020, our revenues exceeded the high-end of our previous guidance ranges, while our adjusted EBITDA were both within our previous guidance ranges. Such strong financial results continued to illustrate our on-track and efficient cabinet delivery to customers, as well as our improved operating efficiency. Recognizing the significant potential for future growth and expansion, we made the decision to execute a convertible notes offering in an aggregate principal amount of US$600 million in January 2021. This has further demonstrated our recognized growth prospects, substantial brand value, and potent investor interest. “

 

Fourth Quarter 2020 Financial Results

 

NET REVENUES: Net revenues in the fourth quarter of 2020 increased by 28.6% to RMB1.35 billion (US$206.6 million) from RMB1.05 billion in the fourth quarter of 2019, representing an increase of 8.2% from RMB1.25 billion in the third quarter of 2020. This increase was mainly due to the Company’s increased engagement with existing wholesale customers as well as the addition of new retail IDC customers.

 

GROSS PROFIT: Gross profit in the fourth quarter of 2020 was RMB294.4 million (US$45.1 million), representing an increase of 18.8% from RMB247.9 million in the same period of 2019 and an increase of 7.0% from RMB275.1 million in the third quarter of 2020. Gross margin in the fourth quarter of 2020 was 21.8%, compared to 23.6% in the same period of 2019 and 22.1% in the third quarter of 2020. The year-over-year decrease in gross margin was primarily attributable to the delivery of additional IDC capacity.

 

ADJUSTED CASH GROSS PROFIT, which excludes depreciation, amortization, and share-based compensation expenses, was RMB581.9 million (US$89.2 million) in the fourth quarter of 2020, compared to RMB425.9 million in the same period of 2019 and RMB526.2 million in the third quarter of 2020. Adjusted cash gross margin in the fourth quarter of 2020 was 43.2%, compared to 40.6% in the same period of 2019 and 42.2% in the third quarter of 2020.

 

OPERATING EXPENSES: Total operating expenses in the fourth quarter of 2020 were RMB369.2 million (US$56.6 million), compared to RMB244.4 million in the same period of 2019 and RMB199.3 million in the third quarter of 2020. As a percentage of net revenues, total operating expenses in the fourth quarter of 2020 were 27.4%, compared to 23.3% in the same period of 2019 and 16.0% in the third quarter of 2020.

 

Sales and marketing expenses in the fourth quarter of 2020 were RMB88.9 million (US$13.6 million), compared to RMB63.2 million in the same period of 2019 and RMB45.8 million in the third quarter of 2020. The year-over-year increase in sales and marketing expenses was in line with the Company’s business expansion efforts.

 


 

Research and development expenses in the fourth quarter of 2020 were RMB42.2 million (US$6.5 million), compared to RMB24.9 million in the same period of 2019 and RMB26.1 million in the third quarter of 2020. This increase was primarily due to the Company’s ongoing efforts to explore various technology upgrades and more scalable delivery methods for its cloud-neutral solutions.

 

General and administrative expenses in the fourth quarter of 2020 were RMB162.9 million (US$25.0 million), compared to RMB110.0 million in the same period of 2019 and RMB127.5 million in the third quarter of 2020. The increase in general and administrative expenses was primarily due to share-based compensation recognized.

 

ADJUSTED OPERATING EXPENSES, which exclude share-based compensation expenses, impairment of receivables from equity investees and impairment of long-lived assets , were RMB215.5 million (US$33.0 million) in the fourth quarter of 2020, compared to RMB184.2 million in the same period of 2019 and RMB180.5 million in the third quarter of 2020. As a percentage of net revenues, adjusted operating expenses in the fourth quarter of 2020 were 16.0%, compared to 17.6% in the same period of 2019 and 14.5% in the third quarter of 2020.

 

ADJUSTED EBITDA: Adjusted EBITDA in the fourth quarter of 2020 was RMB389.8 million (US$59.7 million), representing an increase of 47.7% from RMB263.8 million in the same period of 2019 and an increase of 5.8% from RMB368.5 million in the third quarter of 2020. Adjusted EBITDA in the fourth quarter of 2020 excluded share-based compensation expenses of RMB82.0 million (US$12.6 million). Adjusted EBITDA margin was 28.9% in the fourth quarter of 2020, compared to 25.2% in the same period of 2019 and 29.6% in the third quarter of 2020.

 

NET PROFIT/LOSS: Net loss attributable to ordinary shareholders in the fourth quarter of 2020 was RMB1.02 billion (US$155.6 million), compared to net loss attributable to ordinary shareholders of RMB16.4 million in the same period of 2019 and net profit attributable to ordinary shareholders of RMB97.1 million in the third quarter of 2020. The year-over-year increase of loss was primarily attributable to a loss of RMB957.1 million (US$146.7 million) from changes in the fair value of convertible promissory notes.

 

PROFIT/LOSS PER SHARE: Basic and diluted loss per share both were RMB1.28 (US$0.20) in the fourth quarter of 2020, which represents the equivalent of RMB7.68 (US$1.20) per American depositary share (“ADS”). Each ADS represents six Class A ordinary shares. Diluted profit/loss per share is calculated using net profit/loss attributable to ordinary shareholders divided by the weighted average number of diluted shares outstanding.

 

As of December 31, 2020, the aggregate amount of the Company’s cash and cash equivalents, restricted cash, and short-term investments was RMB3.40 billion (US$521.4 million).

 

Net cash generated from operating activities in the fourth quarter of 2020 was RMB283.8 million (US$43.5 million), compared to RMB444.8 million in the same period of 2019 and RMB210.0 million in the third quarter of 2020.

 


 

Full Year 2020 Financial Results

 

NET REVENUES: Net revenues in the full year of 2020 increased by 27.4% to RMB4.83 billion (US$740.1 million) from RMB3.79 billion in the full year of 2019.

 

GROSS PROFIT: Gross profit in the full year of 2020 was RMB1.08 billion (US$164.9 million), representing an increase of 14.5% from RMB939.4 million in the full year of 2019. Gross margin in the full year of 2020 was 22.3%, compared to 24.8% in the full year of 2019.

 

ADJUSTED CASH GROSS PROFIT, which excludes depreciation, amortization, and share-based compensation expenses, was RMB1.99 billion (US$305.4 million) in the full year of 2020, compared to RMB1.63 billion in the full year of 2019. Adjusted cash gross margin in the full year of 2020 was 41.3%, compared to 43.1% in the full year of 2019.

 

OPERATING EXPENSES: Total operating expenses in the full year of 2020 were RMB959.4 million (US$147.0 million), compared to RMB757.2 million in the full year of 2019. As a percentage of net revenues, total operating expenses in the full year of 2020 were 19.9%, compared to 20.0% in the full year of 2019.

 

Sales and marketing expenses in the full year of 2020 were RMB235.0 million (US$36.0 million), representing an increase of 13.9% from RMB206.3 million in the full year of 2019.

 

Research and development expenses in the full year of 2020 were RMB112.9 million (US$17.3 million), representing an increase of 27.1% from RMB88.8 million in the full year of 2019.

 

General and administrative expenses in the full year of 2020 were RMB535.1 million (US$82.0 million), representing an increase of 28.9% from RMB415.3 million in the full year of 2019.

 

ADJUSTED OPERATING EXPENSES, which exclude share-based compensation expenses, impairment of receivables from equity investees and impairment of long-lived assets, were RMB756.2 million (US$115.9 million) in the full year of 2020, compared to RMB663.0 million in the full year of 2019. As a percentage of net revenues, adjusted operating expenses in the full year of 2020 were 15.7%, compared to 17.5% in the full year of 2019.

 

ADJUSTED EBITDA: Adjusted EBITDA in the full year of 2020 was RMB1.32 billion (US$202.9 million), representing an increase of 26.0% from RMB1.05 billion in the full year of 2019. Adjusted EBITDA in the full year of 2020 excluded share-based compensation expenses of RMB136.8 million (US$21.0 million). Adjusted EBITDA margin in the full year of 2020 was 27.4%, compared to 27.7% in the full year of 2019.

 

NET PROFIT/LOSS: Net loss attributable to ordinary shareholders in the full year of 2020 was RMB3.18 billion (US$487.4 million), compared to net loss attributable to ordinary shareholders of RMB182.3 million in the full year of 2019. The increase of loss was primarily attributable to a loss of RMB2.54 billion (US$389.9 million) from changes in the fair value of convertible promissory notes.

 

PROFIT/LOSS PER SHARE: Basic and diluted loss per share both were RMB4.47 (US$0.69), which represents the equivalent of RMB26.82 (US$4.14) per ADS. Diluted profit/loss per share is calculated using net profit/loss attributable to ordinary shareholders divided by the weighted average number of diluted shares outstanding.

 


 

Net cash generated from operating activities in the full year of 2020 was RMB714.2 million (US$109.5 million), compared to RMB802.9 million in the full year of 2019.

 

Financial Outlook

 

For the first quarter of 2021, the Company expects net revenues to be in the range of RMB1,375 million to RMB1,395 million. Adjusted EBITDA is expected to be in the range of RMB395 million to RMB415 million.

 

For the full year of 2021, the Company expects net revenues to be in the range of RMB6,100 million to RMB6,300 million. Adjusted EBITDA is expected to be in the range of RMB1,680 million to RMB1,780 million. The midpoints of the Company’s updated estimates imply an increase of 28.4% and 30.7% year over year in net revenues and adjusted EBITDA, respectively.

 

The forecast reflects the Company’s current and preliminary views on the market and its operational conditions, which do not factor in any of the potential future impacts caused by the COVID-19 pandemic, and are subject to change.

 

Conference Call

 

The Company will hold a conference call at 8:30 P.M. on Tuesday, March 23, 2021, U.S. Eastern Time, or 8:30 A.M. on Wednesday, March 24, 2021, Beijing Time, to discuss the financial results.

 

In advance of the conference call, all participants must use the following link to complete the online registration process to receive a unique registrant ID and a set of participant dial-in numbers to join the conference call.

 

Conference ID:

6392518

Registration Link:

http://apac.directeventreg.com/registration/event/6392518

 

The replay will be accessible through March 31, 2021, by dialing the following numbers:

 

United States Toll Free:

+1-855-452-5696

International:

+61-2-8199-0299

Conference ID:

6392518

 

A live and archived webcast of the conference call will be available through the Company’s investor relations website at http://ir.21vianet.com.

 

Non-GAAP Disclosure

 

In evaluating its business, 21Vianet considers and uses the following non-GAAP measures defined as non-GAAP financial measures by the Securities and Exchange Commission as a supplemental measure to review and assess its operating performance: adjusted cash gross profit, adjusted cash gross margin, adjusted operating expenses, adjusted EBITDA and adjusted EBITDA margin. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with U.S. GAAP. For more information on these non-GAAP financial measures, please see the table captioned “Reconciliations of GAAP and non-GAAP results” set forth at the end of this press release.

 


 

The non-GAAP financial measures are provided as additional information to help investors compare business trends among different reporting periods on a consistent basis and to enhance investors’ overall understanding of the Company’s current financial performance and prospects for the future. These non-GAAP financial measures should be considered in addition to results prepared in accordance with U.S. GAAP, but should not be considered a substitute for, or superior to, U.S. GAAP results. In addition, the Company’s calculation of the non-GAAP financial measures may be different from the calculation used by other companies, and therefore comparability may be limited.

 

Exchange Rate

 

This announcement contains translations of certain RMB amounts into U.S. dollars (“USD”) at specified rates solely for the convenience of the reader. Unless otherwise stated, all translations from RMB to USD were made at the rate of RMB6.5250 to US$1.00, the noon buying rate in effect on December 31, 2020, in the H.10 statistical release of the Federal Reserve Board. The Company makes no representation that the RMB or USD amounts referred could be converted into USD or RMB, as the case may be, at any particular rate or at all. For analytical presentation, all percentages are calculated using the numbers presented in the financial statements contained in this earnings release.

 

Statement Regarding Unaudited Condensed Financial Information

 

The unaudited financial information set forth above is preliminary and subject to potential adjustments. Adjustments to the consolidated financial statements may be identified when audit work has been performed for the Company’s year-end audit, which could result in significant differences from this preliminary unaudited condensed financial information.

 

About 21Vianet

 

21Vianet Group, Inc. is a leading carrier- and cloud-neutral Internet data center services provider in China. 21Vianet provides hosting and related services, including IDC services, cloud services, and business VPN services to improve the reliability, security and speed of its customers’ Internet infrastructure. Customers may locate their servers and equipment in 21Vianet’s data centers and connect to China’s Internet backbone. 21Vianet operates in more than 20 cities throughout China, servicing a diversified and loyal base of over 6,000 hosting and related enterprise customers that span numerous industries ranging from Internet companies to government entities and blue-chip enterprises to small- to mid-sized enterprises.

 


 

Safe Harbor Statement

 

This announcement contains forward-looking statements. These forward-looking statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements can be identified by terminology such as “will,” “expects,” “anticipates,” “future,” “intends,” “plans,” “target,” “believes,” “estimates” and similar statements. Among other things, quotations from management in this announcement as well as 21Vianet’s strategic and operational plans contain forward-looking statements. 21Vianet may also make written or oral forward-looking statements in its reports filed with, or furnished to, the U.S. Securities and Exchange Commission, in its annual reports to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about 21Vianet’s beliefs and expectations, are forward-looking statements. 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: 21Vianet’s goals and strategies; 21Vianet’s expansion plans; the expected growth of the data center services market; expectations regarding demand for, and market acceptance of, 21Vianet’s services; 21Vianet’s expectations regarding keeping and strengthening its relationships with customers; 21Vianet’s plans to invest in research and development to enhance its solution and service offerings; and general economic and business conditions in the regions where 21Vianet provides solutions and services. Further information regarding these and other risks is included in 21Vianet’s reports filed with, or furnished to, the Securities and Exchange Commission. All information provided in this press release and in the attachments is as of the date of this press release, and 21Vianet undertakes no duty to update such information, except as required under applicable law.

 

Investor Relations Contacts:

 

21Vianet Group, Inc.

Rene Jiang

+86 10 8456 2121

IR@21Vianet.com

 

Julia Jiang

+86 10 8456 2121

IR@21Vianet.com

 

ICR, Inc.

Xinran Rao

+1 (646) 405-4922

IR@21Vianet.com

 


 

21VIANET GROUP, INC.

CONSOLIDATED BALANCE SHEETS

(Amount in thousands of Renminbi (“RMB”) and US dollars (“US$”))

 

 

 

As of

 

As of

 

 

 

December 31, 2019

 

December 31, 2020

 

 

 

RMB

 

RMB

 

US$

 

 

 

(Audited)

 

(Unaudited)

 

(Unaudited)

 

Assets

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

Cash and cash equivalents

 

1,808,483

 

2,710,349

 

415,379

 

Restricted cash

 

478,873

 

270,450

 

41,448

 

Accounts and notes receivable, net

 

657,158

 

847,233

 

129,844

 

Short-term investments

 

363,856

 

285,872

 

43,812

 

Prepaid expenses and other current assets

 

1,618,149

 

1,866,184

 

286,005

 

Amounts due from related parties

 

301,665

 

75,519

 

11,574

 

Total current assets

 

5,228,184

 

6,055,607

 

928,062

 

 

 

 

 

 

 

 

 

Non-current assets:

 

 

 

 

 

 

 

Property and equipment, net

 

5,443,565

 

8,104,069

 

1,242,003

 

Intangible assets, net

 

410,595

 

660,551

 

101,234

 

Land use rights, net

 

233,154

 

255,373

 

39,138

 

Operating lease right-of-use assets, net

 

1,221,616

 

1,325,526

 

203,146

 

Goodwill

 

989,530

 

994,993

 

152,489

 

Restricted cash

 

69,821

 

135,638

 

20,787

 

Deferred tax assets

 

209,366

 

185,481

 

28,426

 

Long-term investments

 

169,653

 

135,517

 

20,769

 

Amounts due from related parties

 

20,654

 

20,562

 

3,151

 

Other non-current assets

 

277,568

 

1,500,438

 

229,952

 

Total non-current assets

 

9,045,522

 

13,318,148

 

2,041,095

 

Total assets

 

14,273,706

 

19,373,755

 

2,969,157

 

 

 

 

 

 

 

 

 

Liabilities and Shareholders’ Equity

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

Short-term bank borrowings

 

234,500

 

34,000

 

5,211

 

Accounts and notes payable

 

303,128

 

289,387

 

44,350

 

Accrued expenses and other payables

 

978,935

 

1,631,563

 

250,048

 

Advances from customers

 

1,068,692

 

1,041,594

 

159,631

 

Deferred revenue

 

57,625

 

63,245

 

9,693

 

Income taxes payable

 

48,032

 

29,028

 

4,449

 

Amounts due to related parties

 

166,935

 

51,007

 

7,817

 

Current portion of long-term borrowings

 

32,500

 

180,328

 

27,636

 

Current portion of finance lease liabilities

 

227,115

 

403,843

 

61,892

 

Current portion of deferred government grant

 

2,595

 

2,074

 

318

 

Current portion of bonds payable

 

911,147

 

1,943,619

 

297,873

 

Current portion of operating lease liabilities

 

437,817

 

452,272

 

69,314

 

Total current liabilities

 

4,469,021

 

6,121,960

 

938,232

 

 

 

 

 

 

 

 

 

Non-current liabilities:

 

 

 

 

 

 

 

Long-term borrowings

 

79,500

 

886,996

 

135,938

 

Bonds payable

 

2,060,708

 

 

 

Convertible promissory notes

 

 

3,014,057

 

461,924

 

Non-current portion of finance lease liabilities

 

896,927

 

688,128

 

105,460

 

Unrecognized tax benefits

 

2,443

 

68,696

 

10,528

 

Deferred tax liabilities

 

202,572

 

299,093

 

45,838

 

Non-current portion of deferred government grant

 

5,906

 

4,100

 

628

 

Amounts due to related parties

 

745,899

 

747,746

 

114,597

 

Non-current portion of operating lease liabilities

 

579,102

 

645,499

 

98,927

 

Total non-current liabilities

 

4,573,057

 

6,354,315

 

973,840

 

 

 

 

 

 

 

 

 

Shareholders’ equity

 

 

 

 

 

 

 

Treasury stock

 

(349,523

)

(349,523

)

(53,567

)

Ordinary shares

 

46

 

56

 

9

 

Additional paid-in capital

 

9,202,567

 

13,083,119

 

2,005,076

 

Accumulated other comprehensive gain (loss)

 

77,904

 

(55,535

)

(8,511

)

Statutory reserves

 

60,469

 

74,462

 

11,412

 

Accumulated deficit

 

(4,038,390

)

(7,235,113

)

(1,108,830

)

Series A perpetual convertible preferred shares

 

 

1,047,468

 

160,531

 

Total 21Vianet Group, Inc. shareholders’ equity

 

4,953,073

 

6,564,934

 

1,006,120

 

Noncontrolling interest

 

278,555

 

332,546

 

50,965

 

Total shareholders’ equity

 

5,231,628

 

6,897,480

 

1,057,085

 

Total liabilities and shareholders’ equity

 

14,273,706

 

19,373,755

 

2,969,157

 

 


 

21VIANET GROUP, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Amount in thousands of Renminbi (“RMB”) and US dollars (“US$”) except for number of shares and per share data)

 

 

 

Three months ended

 

Twelve months ended

 

 

 

December 31, 2019

 

September 30, 2020

 

December 31, 2020

 

December 31, 2019

 

December 31, 2020

 

 

 

RMB

 

RMB

 

RMB

 

US$

 

RMB

 

RMB

 

US$

 

 

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

(Audited)

 

(Unaudited)

 

(Unaudited)

 

Net revenues

 

1,048,119

 

1,245,794

 

1,348,367

 

206,646

 

3,788,967

 

4,829,019

 

740,080

 

Cost of revenues

 

(800,248

)

(970,651

)

(1,053,942

)

(161,524

)

(2,849,518

)

(3,753,008

)

(575,174

)

Gross profit

 

247,871

 

275,143

 

294,425

 

45,122

 

939,449

 

1,076,011

 

164,906

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other operating income

 

6,862

 

 

7,619

 

1,168

 

6,862

 

7,619

 

1,168

 

Sales and marketing

 

(63,188

)

(45,760

)

(88,890

)

(13,623

)

(206,309

)

(235,012

)

(36,017

)

Research and development

 

(24,920

)

(26,078

)

(42,164

)

(6,462

)

(88,792

)

(112,891

)

(17,301

)

General and administrative

 

(109,984

)

(127,546

)

(162,869

)

(24,961

)

(415,277

)

(535,111

)

(82,009

)

(Allowance) reversal for doubtful debt

 

(1,072

)

111

 

(1,321

)

(202

)

(1,557

)

(2,393

)

(367

)

Impairment of receivables from equity investees

 

(52,142

)

 

 

 

(52,142

)

 

 

Impairment of long-lived assets

 

 

 

(81,619

)

(12,509

)

 

(81,619

)

(12,509

)

Total operating expenses

 

(244,444

)

(199,273

)

(369,244

)

(56,589

)

(757,215

)

(959,407

)

(147,035

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit

 

3,427

 

75,870

 

(74,819

)

(11,467

)

182,234

 

116,604

 

17,871

 

Interest income

 

14,988

 

6,440

 

4,176

 

640

 

54,607

 

31,711

 

4,860

 

Interest expense

 

(88,375

)

(96,366

)

(79,243

)

(12,145

)

(345,955

)

(380,609

)

(58,331

)

Impairment of long-term investment

 

 

 

(13,030

)

(1,997

)

 

(13,030

)

(1,997

)

Other income

 

22,160

 

2,747

 

4,736

 

726

 

36,380

 

16,539

 

2,535

 

Other expense

 

(1,270

)

(4,995

)

(7,926

)

(1,215

)

(5,632

)

(36,912

)

(5,657

)

Changes in the fair value of convertible promissory notes

 

 

24,939

 

(957,105

)

(146,683

)

 

(2,544,220

)

(389,919

)

Foreign exchange gain (loss)

 

22,512

 

114,101

 

155,496

 

23,831

 

(27,995

)

228,125

 

34,962

 

Loss on debt extinguishment

 

(122

)

 

 

 

(18,895

)

 

 

(Loss) gain before income taxes and (loss) gain from equity method investments

 

(26,680

)

122,736

 

(967,715

)

(148,310

)

(125,256

)

(2,581,792

)

(395,676

)

Income tax benefits (expenses)

 

24,686

 

(25,230

)

(41,210

)

(6,316

)

(5,437

)

(109,336

)

(16,756

)

(Loss) gain from equity method investments

 

(20,260

)

2,265

 

15,194

 

2,329

 

(50,553

)

10,869

 

1,666

 

Net (loss) profit

 

(22,254

)

99,771

 

(993,731

)

(152,297

)

(181,246

)

(2,680,259

)

(410,766

)

Net loss (profit) attributable to noncontrolling interest

 

5,838

 

(2,627

)

(21,647

)

(3,318

)

(1,046

)

(29,088

)

(4,458

)

Net (loss) profit attributable to 21 Vianet Group, Inc.

 

(16,416

)

97,144

 

(1,015,378

)

(155,615

)

(182,292

)

(2,709,347

)

(415,224

)

Deemed distribution to Series A perpetual convertible preferred shareholders

 

 

 

 

 

 

(470,643

)

(72,129

)

Net (loss) profit attributable to the Company’s ordinary shareholders

 

(16,416

)

97,144

 

(1,015,378

)

(155,615

)

(182,292

)

(3,179,990

)

(487,353

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Loss) profit per share

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

(0.02

)

0.11

 

(1.28

)

(0.20

)

(0.27

)

(4.47

)

(0.69

)

Diluted

 

(0.02

)

0.08

 

(1.28

)

(0.20

)

(0.27

)

(4.47

)

(0.69

)

Shares used in (loss) profit per share computation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic*

 

670,523,195

 

716,409,506

 

802,963,713

 

802,963,713

 

668,833,756

 

716,888,919

 

716,888,919

 

Diluted*

 

670,523,195

 

805,640,008

 

802,963,713

 

802,963,713

 

668,833,756

 

716,888,919

 

716,888,919

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Loss) profit per ADS (6 ordinary shares equal to 1 ADS)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

(0.12

)

0.66

 

(7.68

)

(1.20

)

(1.62

)

(26.82

)

(4.14

)

Diluted

 

(0.12

)

0.48

 

(7.68

)

(1.20

)

(1.62

)

(26.82

)

(4.14

)

 


* Shares used in (loss) profit per share/ADS computation were computed under weighted average method.

 


 

21VIANET GROUP, INC.

RECONCILIATIONS OF GAAP AND NON-GAAP RESULTS

(Amount in thousands of Renminbi (“RMB”) and US dollars (“US$”))

 

 

 

Three months ended

 

Twelve months ended

 

 

 

December 31, 2019

 

September 30, 2020

 

December 31, 2020

 

December 31, 2019

 

December 31, 2020

 

 

 

RMB

 

RMB

 

RMB

 

US$

 

RMB

 

RMB

 

US$

 

Gross profit

 

247,871

 

275,143

 

294,425

 

45,122

 

939,449

 

1,076,011

 

164,906

 

Plus: depreciation and amortization

 

177,529

 

246,747

 

277,543

 

42,535

 

691,764

 

901,497

 

138,160

 

Plus: share-based compensation expenses

 

487

 

4,340

 

9,882

 

1,514

 

1,884

 

15,251

 

2,337

 

Adjusted cash gross profit

 

425,887

 

526,230

 

581,850

 

89,171

 

1,633,097

 

1,992,759

 

305,403

 

Adjusted cash gross margin

 

40.6

%

42.2

%

43.2

%

43.2

%

43.1

%

41.3

%

41.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses

 

(244,444

)

(199,273

)

(369,244

)

(56,589

)

(757,215

)

(959,407

)

(147,035

)

Plus: share-based compensation expenses

 

8,102

 

18,768

 

72,152

 

11,058

 

42,032

 

121,553

 

18,629

 

Plus: impairment of receivables from equity investees

 

52,142

 

 

 

 

52,142

 

 

 

Plus: impairment of long-lived assets

 

 

 

81,619

 

12,509

 

 

81,619

 

12,509

 

Adjusted operating expenses

 

(184,200

)

(180,505

)

(215,473

)

(33,022

)

(663,041

)

(756,235

)

(115,897

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit (loss)

 

3,427

 

75,870

 

(74,819

)

(11,467

)

182,234

 

116,604

 

17,871

 

Plus: depreciation and amortization

 

199,642

 

269,478

 

300,917

 

46,118

 

772,205

 

988,983

 

151,568

 

Plus: share-based compensation expenses

 

8,589

 

23,108

 

82,034

 

12,572

 

43,916

 

136,804

 

20,966

 

Plus: impairment of receivables from equity investees

 

52,142

 

 

 

 

52,142

 

 

 

Plus: impairment of long-lived assets

 

 

 

81,619

 

12,509

 

 

81,619

 

12,509

 

Adjusted EBITDA

 

263,800

 

368,456

 

389,751

 

59,732

 

1,050,497

 

1,324,010

 

202,914

 

Adjusted EBITDA margin

 

25.2

%

29.6

%

28.9

%

28.9

%

27.7

%

27.4

%

27.4

%

 


 

21VIANET GROUP, INC.

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

(Amount in thousands of Renminbi (“RMB”) and US dollars (“US$”))

 

 

 

Three months ended

 

 

 

December 31, 2019

 

September 30, 2020

 

December 31, 2020

 

 

 

RMB

 

RMB

 

RMB

 

US$

 

 

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

CASH FLOWS FROM OPERATING ACTIVITIES

 

 

 

 

 

 

 

 

 

Net (loss) profit

 

(22,254

)

99,771

 

(993,731

)

(152,297

)

Adjustments to reconcile net (loss) profit to net cash generated from operating activities:

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

199,642

 

269,478

 

300,917

 

46,118

 

Stock-based compensation expenses

 

8,589

 

23,108

 

82,034

 

12,572

 

Others

 

11,992

 

(60,721

)

968,802

 

148,475

 

Changes in operating assets and liabilities

 

 

 

 

 

 

 

 

 

Accounts and notes receivable

 

126,542

 

74,342

 

35,348

 

5,417

 

Prepaid expenses and other current assets

 

2,499

 

438,214

 

(420,382

)

(64,426

)

Accounts and notes payable

 

(36,190

)

(4,676

)

(43,339

)

(6,642

)

Accrued expenses and other payables

 

(23,517

)

8,016

 

(56,107

)

(8,599

)

Deferred revenue

 

(3,391

)

(2,334

)

11,252

 

1,724

 

Advances from customers

 

72,628

 

(559,680

)

413,613

 

63,389

 

Others

 

108,285

 

(75,547

)

(14,576

)

(2,234

)

Net cash generated from operating activities

 

444,825

 

209,971

 

283,831

 

43,497

 

 

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES

 

 

 

 

 

 

 

 

 

Purchases of property and equipment

 

(458,230

)

(786,554

)

(772,513

)

(118,393

)

Purchases of intangible assets

 

(6,919

)

(8,923

)

(4,932

)

(756

)

Payments for investments

 

(136,840

)

(106,368

)

(1,522,143

)

(233,279

)

Proceeds from (payments for) other investing activities

 

51,283

 

(12,626

)

(12,426

)

(1,903

)

Net cash used in investing activities

 

(550,706

)

(914,471

)

(2,312,014

)

(354,331

)

 

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES

 

 

 

 

 

 

 

 

 

Proceeds from issuance of ordinary shares

 

 

2,680,706

 

 

 

Proceeds from bank borrowings

 

4,500

 

24,776

 

160,996

 

24,674

 

Repayment of bank borrowings

 

(13,000

)

(200,000

)

(21,500

)

(3,295

)

Payments for finance lease

 

(91,487

)

(137,982

)

(87,749

)

(13,448

)

Repurchase of 2020 Notes

 

 

(915,543

)

 

 

Payment for shares repurchase and cancellation

 

 

 

(130,472

)

(19,996

)

Proceeds(payments for) from other financing activities

 

21,892

 

(6,628

)

(86,209

)

(13,212

)

Net cash (used in) generated from financing activities

 

(78,095

)

1,445,329

 

(164,934

)

(25,277

)

 

 

 

 

 

 

 

 

 

 

Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash

 

(46,956

)

(108,885

)

(144,757

)

(22,185

)

Net (decrease) increase in cash, cash equivalents and restricted cash

 

(230,932

)

631,944

 

(2,337,874

)

(358,296

)

Cash, cash equivalents and restricted cash at beginning of period

 

2,588,109

 

4,822,367

 

5,454,311

 

835,910

 

Cash, cash equivalents and restricted cash at end of period

 

2,357,177

 

5,454,311

 

3,116,437

 

477,614

 

 




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