Smart Share Global Limited (Nasdaq: EM) (“Energy Monster” or the
“Company”), a consumer tech company providing mobile device
charging service, today announced its unaudited financial results
for the quarter ended March 31, 2024.
HIGHLIGHTS FOR THE
FIRST QUARTER
OF 2024
- As of March 31, 2024, 79.7% of POIs were operated under our
network partner model, compared with 72.8% as of December 31,
2023.
- As of March 31, 2024, the Company’s services were available in
1,245 thousand POIs, compared with 1,234 thousand as of December
31, 2023.
- As of March 31, 2024, the Company’s available-for-use power
banks3 were 9.4 million, compared with 9.2 million as of December
31, 2023.
- As of March 31, 2024, cumulative registered users reached 404.3
million, with 12.8 million newly registered users acquired during
the quarter.
- Mobile device charging orders4 for the first quarter of 2024
was 147.0 million, compared with 153.2 million for the first
quarter of 2023.
“Despite a stable performance this quarter due
to a softer consumption environment, we continue to achieve new
operational milestones,” said Mars Guangyuan Cai, Chairman and
Chief Executive Officer. “We have successfully expanded our POI
coverage to a record-high scale and reached a remarkable milestone
of over 400 million cumulative registered users. Additionally, we
have strategically rebalanced our operational model towards the
network partner model while maintaining our core direct model
portfolios. This transition is anticipated to deliver substantial
economic benefits for the Company in the long term. We remain
steadfast in our commitment to delivering sustainable value to all
our stakeholders and are optimistic about the future prospects of
the mobile device charging service sector in China.”
“Our transition to the network partner model has
been executed with precision, carefully balancing the rate of
transition with quality,” said Peifeng Xu, President. “We are
consistently reducing under-performing POIs and optimizing the
operational efficiency of our direct model. Despite the challenging
environment, we have maintained POI expansion momentum through the
acquisition of new key accounts and by placing increased emphasis
on the network partner model for core expansion. This strategy
ensures that we leverage the strengths of both models to drive our
coverage expansion and profitability.”
“The transition from the direct model to the
network partner model in certain regions has incurred one-off
costs, but it is a strategic move that will benefit the financial
health of the Company in the long run,” said Maria Yi Xin, Chief
Financial Officer. “We continue to maintain a strong balance sheet,
providing us with the flexibility to navigate challenging
environments and explore new opportunities that will drive future
growth. Our focus remains on delivering long-term value for our
shareholders, as exemplified by our previously announced share
repurchase program and special dividend. We are confident that our
initiatives will unlock our growth and value potential in the
foreseeable future.”
PREVIOUS UPDATE ON
CONTRACTUAL ARRANGEMENTStarting in the second quarter of
2023, the Company has updated its contractual arrangement with its
network partners under the network partner model, shifting the
principal role of providing mobile device charging service from the
Company to network partners. Under the new contractual arrangement,
the Company generates revenue by providing mobile device charging
solutions to network partners, including software and system
service, billing and settlement service, customer call center
service and other services. The ownership rights of cabinets and
power banks under the network partner model, which were previously
held by the Company, have also been transferred to the network
partners under the new contractual arrangement.
Starting in the second quarter of 2023, mobile
device charging revenue generated under the network partner model
has therefore been recorded under mobile device charging solution,
which is now net of incentive fees paid to network partners.
Relatedly, all incentive fees paid to network partners have been
excluded from the Company’s sales and marketing expenses under the
new contractual arrangement. Due to the new contractual
arrangement, the Company now also generates revenue from cabinet
and power bank sales to its network partners as a result of the
shift in ownership rights of the cabinets and power banks under the
network partner model from the Company to the network partners, and
cost of cabinets and power banks sold to the network partners will
be recognized accordingly.
Starting in the second quarter of 2023, the
classification of revenue has been updated accordingly to more
clearly reflect the results of the two mobile device charging
models. The Company’s mobile device charging operation now consists
of the direct model and the network partner model. Under the direct
model, the Company generates revenue by offering mobile device
charging service and sales of power banks to users. Under the
network partner model, the Company generates revenue by offering
mobile device charging solutions and sales of power banks and
cabinets to network partners.
The table below sets forth the breakdown of
mobile device charging revenue components based on the latest
classification for the periods indicated:
|
2023Q1 |
|
2023Q4 |
|
2024Q1 |
|
thousands RMB |
|
thousands RMB |
|
thousands RMB |
|
|
|
|
|
|
Mobile device charging: |
|
|
|
|
|
Direct Model |
282,625 |
|
215,741 |
|
155,224 |
Mobile device charging service |
275,716 |
|
210,899 |
|
152,108 |
Power bank sales |
6,909 |
|
4,842 |
|
3,116 |
Network Partner Model |
530,420 |
|
249,958 |
|
222,852 |
Mobile device charging service |
518,743 |
|
- |
|
- |
Mobile device charging solution |
- |
|
60,600 |
|
59,016 |
Power bank and cabinet sales |
11,677 |
|
189,358 |
|
163,836 |
Total mobile device charging |
813,045 |
|
465,699 |
|
378,076 |
|
|
|
|
|
|
FINANCIAL RESULTS FOR THE
FIRST QUARTER OF
2024Revenues were
RMB397.2 million (US$55.0 million5) for the first quarter of 2024,
representing a 51.7% decrease from the same period in 2023. The
decrease was primarily due to the decrease in mobile device
charging revenues as a result of the change in the contractual
arrangement with network partners.
- Mobile device charging
revenues, which consist of revenues generated
under both the direct and network partner models, decreased by
53.5% to RMB378.1 million (US$52.4 million) for the first quarter
of 2024, from RMB813.0 million in the same period of 2023.
- Revenues generated under the direct
model, which comprise of mobile device charging service fees of
RMB152.1 million and power bank sales of RMB3.1 million, decreased
by 45.1% to RMB155.2 million for the first quarter of 2024, from
RMB282.6 million in the same period of 2023. The decrease was
primarily due to the decrease in number of POIs operated under the
direct model.
- Revenues generated under the
network partner model, which comprise of mobile device charging
solution fees of RMB59.0 million and sales of cabinets and power
banks of RMB163.8 million, decreased by 58.0% to RMB222.9 million
for the first quarter of 2024, from RMB530.4 million in the same
period of 2023. The decrease was primarily due to the change in the
contractual arrangement with network partners. Under the new
contractual arrangement, mobile device charging revenues generated
under the network partner model are net of incentive fees paid to
network partners. The decrease was partially offset by the increase
in the sales of cabinet and power bank to network
partners.
- Other
revenues, which primarily comprise of revenues from
advertising services and new business initiatives, increased by
95.4% to RMB19.1 million (US$2.6 million) for the first quarter of
2024, from RMB9.8 million in the same period of 2023. The increase
was primarily attributable to new business initiatives as well as
increases in users and advertisement efficiency.
Cost of revenues increased by
31.7% to RMB167.7 million (US$23.2 million) for the first quarter
of 2024, from RMB127.4 million in the same period last year. The
increase was primarily due to the increase in sales of cabinets and
power banks under the new contractual arrangement with network
partners, partially offset by the decrease in depreciation
cost.
Research and development
expenses decreased by 8.3% to RMB19.7 million (US$2.7
million) for the first quarter of 2024, from RMB21.4 million in the
same period last year. The decrease was primarily due to the
decrease in personnel related expenses.
Sales and marketing expenses
decreased by 69.3% to RMB204.5 million (US$28.3 million) for the
first quarter of 2024 from RMB665.3 million in the same period last
year. The decrease was primarily due to the decrease in incentive
fees paid to network partners as a result of the change in the
contractual arrangement with network partners, the decrease in
incentive fees paid to location partners and the reduction in
personnel related expenses under the direct model.
General and administrative
expenses remained relatively stable at RMB26.6 million
(US$3.7 million) for the first quarter of 2024, compared to RMB26.8
million in the same period last year.
Loss from operations for the
first quarter of 2024 was RMB22.8 million (US$3.2 million),
compared to a loss from operations of RMB15.8 million in the same
period last year.
Net loss for
the first quarter of 2024 was RMB0.3 million, compared to a net
income of RMB10.8 million in the same period last year.
Adjusted net income for the
first quarter of 2024 was RMB3.8 million (US$0.5 million), compared
to an adjusted net income of RMB17.1 million in the same period
last year.
Net loss
attributable to ordinary shareholders for the
first quarter of 2024 was RMB0.3 million, compared to a net income
attributable to ordinary shareholders of RMB10.8 million in the
same period last year.
As of March 31, 2024, the Company
had cash and cash equivalents, restricted cash and short-term
investments of RMB3.3 billion (US$454.1
million).
CONFERENCE CALL INFORMATIONThe
company will hold a conference call at 8:00 A.M. Eastern Time on
Monday, June 3, 2024 (8:00 P.M. Beijing Time on Monday, June 3,
2024) to discuss the financial results. Upon registration, each
participant will receive dial-in details to join the conference
call.
Event Title: Energy Monster’s First Quarter 2024
Earnings Conference CallPre-registration link:
https://s1.c-conf.com/diamondpass/10039333-8hdt5e.html
Participants may also access the call via webcast:
https://edge.media-server.com/mmc/p/msw8figv
A telephone replay will be available through June
10, 2024. The dial-in details are as follows:
International: |
+61-7-3107-6325 |
United States: |
+1-855-883-1031 |
Mainland China: |
+86-400-120-9216 |
China Hong Kong: |
+852-800-930-639 |
|
|
Access Code: |
10039333 |
|
|
A live and archived webcast of the conference call
will also be available at the Company’s investor relations website
at https://ir.enmonster.com/.
ABOUT SMART SHARE GLOBAL
LIMITEDSmart Share Global Limited (Nasdaq: EM), or Energy
Monster, is a consumer tech company with the mission to energize
everyday life. The Company is the largest provider of mobile device
charging service in China with the number one market share. The
Company provides mobile device charging service through its power
banks, which are placed in POIs such as entertainment venues,
restaurants, shopping centers, hotels, transportation hubs and
public spaces. Users may access the service by scanning the QR
codes on Energy Monster’s cabinets to release the power banks. As
of March 31, 2024, the Company had 9.4 million power banks in
1,245,000 POIs across more than 2,000 counties and county-level
districts in China.
CONTACT USInvestor
RelationsHansen Shiir@enmonster.com
SAFE HARBOR STATEMENTThis press
release contains forward-looking statements. These statements are
made under the “safe harbor” provisions of the U.S. Private
Securities Litigation Reform Act of 1995. In some cases,
forward-looking statements can be identified by words or phrases
such as “may,” “will,” “expect,” “anticipate,” “target,” “aim,”
“estimate,” “intend,” “plan,” “believe,” “potential,” “continue,”
“is/are likely to,” or other similar expressions. Among other
things, the business outlook and quotations from management in this
announcement, as well as the Company’s strategic and operational
plans, contain forward-looking statements. The Company may also
make written or oral forward-looking statements in its reports
filed with, or furnished to, the U.S. Securities and Exchange
Commission (“SEC”), 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 the
Company’s beliefs and expectations, are forward-looking statements.
Forward-looking statements involve inherent risks and
uncertainties, and 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: Energy
Monster’s strategies; its future business development, financial
condition and results of operations; the impact of technological
advancements on the pricing of and demand for its services;
competition in the mobile device charging service industry; Chinese
governmental policies and regulations affecting the mobile device
charging service industry; changes in its revenues, costs or
expenditures; general economic and business conditions globally and
in China and assumptions underlying or related to any of the
foregoing. Further information regarding these and other risks,
uncertainties or factors is included in the Company’s filings with
the SEC. All information provided in this press release is as of
the date of this press release, and the Company does not undertake
any duty to update such information, except as required under
applicable law.
NON-GAAP FINANCIAL MEASUREIn
evaluating its business, the Company considers and uses non-GAAP
adjusted net income in reviewing and assessing its operating
performance. The presentation of this non-GAAP financial measure 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. The Company presents this non-GAAP financial
measure because it is used by management to evaluate operating
performance and formulate business plans. The Company believes that
this non-GAAP financial measure helps identify underlying trends in
its business, provide further information about its results of
operations, and enhance the overall understanding of its past
performance and future prospects.
Non-GAAP financial measures are not defined
under U.S. GAAP and are not presented in accordance with
U.S. GAAP, and have limitations as analytical tools. The
Company’s non-GAAP financial measure does not reflect all items of
expenses that affect its operations and does not represent the
residual cash flow available for discretionary expenditures.
Further, the Company’s non-GAAP measure may differ from the
non-GAAP information used by other companies, including peer
companies, and therefore its comparability may be limited. The
Company compensates for these limitations by reconciling its
non-GAAP financial measure to the nearest U.S. GAAP
performance measure, which should be considered when evaluating
performance. Investors and others are encouraged to review the
Company’s financial information in its entirety and not rely on a
single financial measure.
The Company defines non-GAAP adjusted net income
as net income excluding share-based compensation expenses. For more
information on the non-GAAP financial measure, please see the table
captioned “Unaudited Reconciliation of GAAP and Non-GAAP Results”
set forth at the end of this press release.
Smart Share Global Limited |
Unaudited Consolidated Balance Sheets |
(In thousands, except share and per share data, unless
otherwise noted) |
|
|
|
|
|
|
|
|
|
|
|
December 31, 2023 |
|
|
March 31, 2024 |
|
|
March 31, 2024 |
RMB |
RMB |
US$ |
|
|
|
ASSETS |
|
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
588,644 |
|
|
|
644,367 |
|
|
|
89,244 |
|
Restricted cash |
|
173,246 |
|
|
|
143,433 |
|
|
|
19,865 |
|
Short-term investments |
|
2,541,889 |
|
|
|
2,470,678 |
|
|
|
342,185 |
|
Accounts receivable, net |
|
269,736 |
|
|
|
278,690 |
|
|
|
38,598 |
|
Inventory |
|
106,530 |
|
|
|
129,661 |
|
|
|
17,958 |
|
Prepayments and other current assets |
|
345,744 |
|
|
|
380,314 |
|
|
|
52,673 |
|
|
|
|
|
|
|
|
|
|
Total current assets |
|
4,025,789 |
|
|
|
4,047,143 |
|
|
|
560,523 |
|
|
|
|
|
|
|
|
|
|
Non-current assets: |
|
|
|
|
|
|
|
|
Long-term restricted cash |
|
20,000 |
|
|
|
20,000 |
|
|
|
2,770 |
|
Property, equipment and software, net |
|
322,806 |
|
|
|
282,660 |
|
|
|
39,148 |
|
Right-of-use assets, net |
|
16,353 |
|
|
|
13,225 |
|
|
|
1,832 |
|
Other non-current assets |
|
21,621 |
|
|
|
20,081 |
|
|
|
2,781 |
|
Deferred tax assets, net |
|
18,804 |
|
|
|
18,804 |
|
|
|
2,604 |
|
|
|
|
|
|
|
|
|
|
Total non-current assets |
|
399,584 |
|
|
|
354,770 |
|
|
|
49,135 |
|
|
|
|
|
|
|
|
|
|
Total assets |
|
4,425,373 |
|
|
|
4,401,913 |
|
|
|
609,658 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
|
|
Accounts and notes payable |
|
764,741 |
|
|
|
726,011 |
|
|
|
100,551 |
|
Salary and welfare payable |
|
143,653 |
|
|
|
136,805 |
|
|
|
18,947 |
|
Taxes payable |
|
214,738 |
|
|
|
213,999 |
|
|
|
29,639 |
|
Current portion of lease liabilities |
|
7,399 |
|
|
|
5,849 |
|
|
|
810 |
|
Accruals and other current liabilities |
|
336,959 |
|
|
|
411,791 |
|
|
|
57,032 |
|
|
|
|
|
|
|
|
|
|
Total current liabilities |
|
1,467,490 |
|
|
|
1,494,455 |
|
|
|
206,979 |
|
|
|
|
|
|
|
|
|
|
Non-current liabilities: |
|
|
|
|
|
|
|
|
Non-current lease liabilities |
|
7,641 |
|
|
|
6,497 |
|
|
|
900 |
|
Amounts due to related parties-non-current |
|
1,000 |
|
|
|
1,000 |
|
|
|
138 |
|
Other non-current liabilities |
|
195,585 |
|
|
|
201,019 |
|
|
|
27,841 |
|
|
|
|
|
|
|
|
|
|
Total non-current liabilities |
|
204,226 |
|
|
|
208,516 |
|
|
|
28,879 |
|
|
|
|
|
|
|
|
|
|
Total liabilities |
|
1,671,716 |
|
|
|
1,702,971 |
|
|
|
235,858 |
|
|
|
|
|
|
|
|
|
|
SHAREHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
Ordinary shares |
|
347 |
|
|
|
347 |
|
|
|
48 |
|
Treasury stock |
|
(5,549 |
) |
|
|
(11,756 |
) |
|
|
(1,628 |
) |
Additional paid-in capital |
|
11,791,570 |
|
|
|
11,741,049 |
|
|
|
1,626,117 |
|
Statutory reserves |
|
16,593 |
|
|
|
16,593 |
|
|
|
2,298 |
|
Accumulated other comprehensive income |
|
182,824 |
|
|
|
185,186 |
|
|
|
25,648 |
|
Accumulated deficit |
|
(9,232,128 |
) |
|
|
(9,232,477 |
) |
|
|
(1,278,683 |
) |
|
|
|
|
|
|
|
|
|
Total shareholders' equity |
|
2,753,657 |
|
|
|
2,698,942 |
|
|
|
373,800 |
|
|
|
|
|
|
|
|
|
|
Total liabilities and shareholders' equity |
|
4,425,373 |
|
|
|
4,401,913 |
|
|
|
609,658 |
|
|
|
|
|
|
|
|
|
|
Smart Share
Global Limited |
Unaudited
Consolidated Statements of Comprehensive
(Loss)/Income |
(In
thousands, except share and per share data, unless otherwise
noted) |
|
|
|
|
|
|
|
|
|
Three months ended March 31, |
|
|
2023 |
|
2024 |
|
|
RMB |
|
RMB |
|
US$ |
|
|
|
|
|
|
|
Revenues: |
|
|
|
|
|
|
Mobile device charging |
|
813,045 |
|
|
378,076 |
|
|
52,363 |
|
Others |
|
9,790 |
|
|
19,130 |
|
|
2,649 |
|
|
|
|
|
|
|
|
Total revenues |
|
822,835 |
|
|
397,206 |
|
|
55,012 |
|
|
|
|
|
|
|
|
Cost of revenues |
|
(127,389 |
) |
|
(167,737 |
) |
|
(23,231 |
) |
Research and development expenses |
|
(21,444 |
) |
|
(19,674 |
) |
|
(2,725 |
) |
Sales and marketing expenses |
|
(665,274 |
) |
|
(204,494 |
) |
|
(28,322 |
) |
General and administrative expenses |
|
(26,771 |
) |
|
(26,584 |
) |
|
(3,682 |
) |
Other operating income/(loss) |
|
2,268 |
|
|
(1,474 |
) |
|
(204 |
) |
|
|
|
|
|
|
|
Loss
from operations |
|
(15,775 |
) |
|
(22,757 |
) |
|
(3,152 |
) |
|
|
|
|
|
|
|
Interest and investment income |
|
26,236 |
|
|
30,589 |
|
|
4,237 |
|
Interest expense to third parties |
|
(4,228 |
) |
|
- |
|
|
- |
|
Foreign exchange gain/(loss), net |
|
4,760 |
|
|
(566 |
) |
|
(78 |
) |
Other (loss)/income, net |
|
(183 |
) |
|
73 |
|
|
10 |
|
|
|
|
|
|
|
|
Income before income tax expense |
|
10,810 |
|
|
7,339 |
|
|
1,017 |
|
|
|
|
|
|
|
|
Income tax expense |
|
- |
|
|
(7,688 |
) |
|
(1,065 |
) |
|
|
|
|
|
|
|
Net
income/(loss) |
|
10,810 |
|
|
(349 |
) |
|
(48 |
) |
|
|
|
|
|
|
|
Net
income/(loss) attributable to ordinary shareholders of Smart Share
Global Limited |
|
10,810 |
|
|
(349 |
) |
|
(48 |
) |
|
|
|
|
|
|
|
Other comprehensive (loss)/income |
|
|
|
|
|
|
Foreign currency translation adjustments, net of nil tax |
|
(18,067 |
) |
|
2,362 |
|
|
327 |
|
|
|
|
|
|
|
|
Total comprehensive (loss)/income |
|
(7,257 |
) |
|
2,013 |
|
|
279 |
|
|
|
|
|
|
|
|
Comprehensive (loss)/income attributable to ordinary
shareholders of Smart Share Global Limited |
|
(7,257 |
) |
|
2,013 |
|
|
279 |
|
|
|
|
|
|
|
|
Weighted average number of ordinary shares used in
computing net income/(loss) per share |
|
|
|
|
|
|
-
basic |
|
519,242,751 |
|
|
518,487,159 |
|
|
518,487,159 |
|
-
diluted |
|
519,353,842 |
|
|
518,487,159 |
|
|
518,487,159 |
|
|
|
|
|
|
|
|
Net
income/(loss) per share attributable to ordinary
shareholders |
|
|
|
|
|
|
-
basic |
|
0.02 |
|
|
0.00 |
|
|
0.00 |
|
-
diluted |
|
0.02 |
|
|
0.00 |
|
|
0.00 |
|
|
|
|
|
|
|
|
Net
income/(loss) per ADS attributable to ordinary
shareholders |
|
|
|
|
|
|
-
basic |
|
0.04 |
|
|
0.00 |
|
|
0.00 |
|
-
diluted |
|
0.04 |
|
|
0.00 |
|
|
0.00 |
|
|
|
|
|
|
|
|
Smart Share Global Limited |
Unaudited Reconciliation of GAAP and Non-GAAP
Results |
(In thousands, except share and per share data, unless
otherwise noted) |
|
|
|
|
|
|
|
Three months ended March 31, |
|
2023 |
|
2024 |
|
RMB |
|
RMB |
|
US$ |
|
|
|
|
|
|
Net income/(loss) |
10,810 |
|
(349 |
) |
|
(48 |
) |
Add: |
|
|
|
|
|
Share-based compensation |
6,285 |
|
4,183 |
|
|
579 |
|
Less: |
|
|
|
|
|
Adjusted for tax effects |
- |
|
- |
|
|
- |
|
|
|
|
|
|
|
Adjusted net income (non-GAAP) |
17,095 |
|
3,834 |
|
|
531 |
|
|
|
|
|
|
|
_________________________
1 The Company defines number of points of
interests, or POIs, as of a certain day as the total number of
unique locations whose proprietors (location partners) have entered
into contracts with the Company or its network partners on that day
and have at least one cabinet assigned to the location.2 The
Company defines cumulative registered users as the total number of
users who have agreed to register their mobile phone numbers with
the Company via its mini programs since inception, and the number
of cumulative registered users of the Company on a certain date is
the number of unique mobile phone numbers that have been registered
with the Company since inception on that date.3 The Company defines
available-for-use power banks as of a certain date as the number of
power banks in circulation on that day.4 The Company defines mobile
device charging orders for a given period as the total number of
completed orders placed by registered users of the mobile device
charging business under both the direct and network partner models
in that given period, without any adjustment for orders that may
qualify for discounts or incentives.5 The U.S. dollar (US$) amounts
disclosed in this press release, except for those transaction
amounts that were actually settled in U.S. dollars, are presented
solely for the convenience of the readers. The conversion of
Renminbi (RMB) into US$ in this press release is based on the
exchange rate set forth in the H.10 statistical release of the
Board of Governors of the Federal Reserve System as of March 29,
2024, which was RMB7.2203 to US$1.0000. The percentages stated in
this press release are calculated based on the RMB amounts.
Grafico Azioni Smart Share Global (NASDAQ:EM)
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