SHANGHAI, Nov. 20, 2019 /PRNewswire/ -- JMU Limited (the
"Company" or "JMU") (Nasdaq:
JMU) today announced its unaudited
financial results for the three months ended September 30, 2019.
Third Quarter of Fiscal Year 2019 Highlights
As a result of the Company's divesture of the food supply chain
business and its shift to blockchain business in July 2019,
- Revenues were $580 thousand for
the third quarter of fiscal year 2019.
- Gross profit was $464 thousand
for the third quarter of fiscal year 2019.
- Income from operations for the third quarter of 2019 was
$377 thousand.
Ms. Hua Zhou, Chairperson of the Board of Directors and Chief
Executive Officer, commented, "As part of our on-going efforts to
seek a new direction for the future development of our business, we
have gradually geared our focus towards blockchain technology.
Since the acquisition of our cryptocurrency solutions business in
August, we are committed to expanding our blockchain business by
both conducting internal research and development and acquiring
companies with growth potential in the industry."
"Our efforts are progressing rapidly as we get ready to launch
our very first blockchain product, Mercurity, a provider of
infrastructure and legal expertise for asset digitization. Going
forward, we will continue to focus on the strategic deployment of
our blockchain business and seek to benefit from the growing
blockchain market over the long term," Ms. Zhou concluded.
Development of Current Business
In the third quarter of 2019, the Company achieved substantial
progress in the development of its first blockchain product,
Mercurity, to provide infrastructure and legal services in
connection with assets digitalization. As a connection between
traditional finance and the blockchain world, Mercurity provides
solutions for clients to tokenize their financial or physical
assets and facilitate the digitization, listing and trading of such
assets around the world. At the end of the third quarter of 2019,
JMU has completed the test phase of
Mercurity and is preparing for its official launch.
Third quarter of Fiscal Year 2019 Financial
Performance
Revenues were $580 thousand
in the third quarter of 2019 generated from the Company's new
blockchain business, compared to $28.7
million generated from the food supply chain business in the
same period of last year.
Cost of revenues were $116
thousand in the third quarter of 2019 associated with the
new blockchain business, compared to $28.3
million associated with the food supply chain business in
the same period of last year.
Gross profit for the third quarter of 2019 was
$464 thousand, compared to
$401 thousand in the same period of
last year. Gross margin was 80.0% in the third quarter of 2019
compared to 1.4% in the same period of last year.
Selling and marketing expenses in the third quarter
of 2019 decreased to nil as the Company has not carried out
substantial marketing for the new blockchain business. The Company
expects its selling and marketing expenses to increase in line with
the overall business growth. Selling and marketing expenses were
$805 thousand in the same period of
last year, which were incurred in connection with the food supply
chain business.
General and administrative expenses in the third quarter
of 2019 were $87 thousand that the
Company incurred for the new blockchain business, compared to
$995 thousand in the same period of
last year, which were incurred in connection with the food supply
chain business.
Income from operations in the third quarter of 2019 was
$377 thousand generated from the
blockchain business compared to a loss from operations of
$1.4 million in the same period of
last year, which was incurred by the food supply chain
business.
Income before provision for income taxes in the third
quarter of 2019 was $396 thousand
compared to a net loss attributable to the Company of $1.7 million in the same period of last year.
Non-GAAP net income attributable to the Company, which
excludes amortization of acquired intangible assets, impairment
loss, share-based compensation, and related provision for income
tax benefits, was $0.4 million in the
third quarter of 2019 and non-GAAP net loss attributable to the
Company was $1.5 million in the same
period of last year. For the three months ended September 30, 2019 and 2018, the Company's
weighted average number of ordinary shares used in computing loss
per ordinary share was 1,757,983,781 and 1,476,866,650,
respectively.
As of September 30, 2019, the
Company's cash and cash equivalents were $159 thousand compared to $357 thousand as of December 31, 2018. Total shareholders' equity as
of September 30, 2019, was
$7.8 million, compared to total
shareholders' deficit of $22.2
million as of December 31,
2018.
Non-GAAP Measures
To supplement the Company's consolidated financial statements
presented in accordance with U.S. generally accepted accounting
principles ("U.S. GAAP"), the Company uses various non-GAAP
financial measures that are adjusted from results based on U.S.
GAAP to exclude amortization of acquired intangible assets,
impairment of goodwill, share-based compensation and related
provision for income tax benefits.
The non-GAAP financial information is 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 historical and current
financial performance of the Company's operations and prospects for
the future. The non-GAAP financial information 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
financial results. In addition, the Company's calculation of this
non-GAAP financial information may be different from the
calculation used by other companies, and therefore comparability
may be limited.
A limitation of using these non-GAAP financial measures is that
amortization of acquired intangible assets, impairment of goodwill,
share-based compensation and related provision for income tax
benefits have been and may continue to be for the foreseeable
future significant recurring expenses in the Company's results of
operations. The Company compensates for these limitations by
providing reconciliations of non-GAAP financial measures to U.S.
GAAP financial measures. Please see the reconciliation tables at
the end of this earnings release.
Safe Harbor Statement
This announcement contains forward-looking statements. These
statements are made under the "safe harbor" provisions of the U.S.
Private Securities Litigation Reform Act of 1995. These
forward-looking statements can be identified by terminology such as
"aim," "anticipate," "believe," "estimate," "expect," "hope,"
"going forward," "intend," "ought to," "plan," "project,"
"potential," "seek," "may," "might," "can," "could," "will,"
"would," "shall," "should," "is likely to" and the negative form of
these words and other similar expressions. Among other things,
statements that are not historical facts, including statements
about JMU's beliefs and expectations,
the business outlook and quotations from management in this
announcement, as well as JMU's
strategic and operational plans, are or contain 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: The general
economic and business conditions in China may deteriorate. The growth of Internet
and mobile user population in China might not be as strong as expected.
JMU's plan to enhance customer
experience, upgrade infrastructure and increase service offerings
might not be well received. JMU might
not be able to implement all of its strategic plans as expected.
Competition in China may intensify
further. All information provided in this press release is as of
the date of this press release and are based on assumptions that we
believe to be reasonable as of this date, and JMU does not undertake any obligation to update any
forward-looking statement, except as required under applicable
law.
Contact:
Xingyan Gao
JMU Limited
ir@ccjmu.com
Tel: +86 (021) 6015-1166, ext. 8904
For more information about JMU Limited, please visit:
http://ir.ccjmu.com.
JMU LIMITED
FORMERLY KNOWN AS WOWO LIMITED
CONSOLIDATED STATEMENTS OF OPERATIONS
(US dollars in thousands, except for number of shares and per share
(or ADS) data)
|
|
|
For the periods
ended September30
|
2018
|
|
2019
|
|
|
|
|
Related
parties
|
2,821
|
|
0
|
Third
parties
|
25,832
|
|
580
|
Total
Revenues
|
28,653
|
|
580
|
Cost of
revenues
|
(28,252)
|
|
(116)
|
Gross
profit
|
401
|
|
464
|
|
|
|
|
Operating
expenses:
|
|
|
|
Selling and
marketing
|
(805)
|
|
0
|
General and
administrative
|
(995)
|
|
(87)
|
Impairment
loss
|
0
|
|
-
|
Total operating
expenses
|
(1,800)
|
|
(87)
|
Income (Loss) from
operations
|
(1,399)
|
|
377
|
Interest
income/(expense), net
|
(383)
|
|
0
|
Other
income/(expense), net
|
11
|
|
19
|
Income (Loss)
before provision for income taxes
|
(1,771)
|
|
396
|
Income tax
benefits
|
51
|
|
0
|
Net income
(loss)
|
(1,720)
|
|
396
|
|
|
|
|
Net loss per
ordinary share
|
|
|
|
Basic
|
(0.001)
|
|
0.00
|
Diluted
|
(0.001)
|
|
0.00
|
Weighted average
shares used in calculating net loss per ordinary
share
|
|
|
|
Basic
|
1,476,866,650
|
|
1,757,983,781
|
Diluted
|
1,476,866,650
|
|
1,757,983,781
|
JMU LIMITED
FORMERLY KNOWN AS WOWO LIMITED
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(US dollars in thousands)
|
|
|
For the periods
ended December 31
|
2018
|
|
2019
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
(1,720)
|
|
396
|
Other comprehensive
income/(loss)
|
|
|
|
Change in cumulative foreign currency translation
adjustment
|
(847)
|
|
(125)
|
Comprehensive
income/(loss)
|
(2,567)
|
|
271
|
JMU LIMITED
FORMERLY KNOWN AS WOWO LIMITED
CONSOLIDATED BALANCE SHEETS
(US dollars in thousands)
|
|
|
|
|
December 31,
2018
|
|
September 30,
2019
|
ASSETS:
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
|
357
|
|
159
|
Accounts receivable,
net
|
|
176
|
|
510
|
Inventories
|
|
586
|
|
-
|
Prepaid expenses and
other current assets, net
|
|
1,121
|
|
650
|
Amounts due from
related parties
|
|
2,378
|
|
0
|
Total current
assets
|
|
4,618
|
|
1,319
|
Non-current
assets:
|
|
|
|
|
Property and
equipment, net
|
|
406
|
|
0
|
Intangible
assets
|
|
-
|
|
1,208
|
Investment
|
|
-
|
|
-
|
Goodwill
|
|
-
|
|
5,645
|
Deferred tax
assets
|
|
-
|
|
-
|
Other non-current
assets
|
|
-
|
|
-
|
Total non-current
assets
|
|
406
|
|
6,853
|
TOTAL
ASSETS
|
|
5,024
|
|
8,172
|
LIABILITIES AND
SHAREHOLDER'S EQUITY :
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Short-term bank
borrowings
|
|
7,272
|
|
0
|
Accounts and notes
payable
|
|
543
|
|
0
|
Accrued expenses and
other current liabilities
|
|
6,917
|
|
336
|
Advance from
customers
|
|
423
|
|
0
|
Amounts due to
related parties
|
|
5,135
|
|
0
|
Total current
liabilities
|
|
20,290
|
|
336
|
Non-current
liabilities:
|
|
|
|
|
Other non-current
liabilities
|
|
30
|
|
-
|
Deferred tax
liabilities
|
|
-
|
|
-
|
Amount due to related
parties
|
|
6,892
|
|
0
|
Total non-current
liabilities
|
|
6,922
|
|
0
|
TOTAL
LIABILITIES
|
|
27,212
|
|
336
|
Commitments and
contingencies
|
|
|
|
|
Shareholders'equity:
|
|
|
|
|
Ordinary
shares
|
|
15
|
|
21
|
Additional paid-in
capital
|
|
634,016
|
|
646,069
|
Accumulated
deficit
|
|
(637,143)
|
|
(638,253)
|
Accumulated other
comprehensive loss
|
|
(19,076)
|
|
(1)
|
Total
shareholders' equity/(deficit)
|
|
(22,188)
|
|
7,836
|
TOTAL LIABILITIES
AND SHAREHOLDERS'EQUITY
|
|
5,024
|
|
8,172
|
JMU LIMITED
Reconciliation of Non-GAAP financial measures
to comparable GAAP measures
(US dollars in thousands)
|
|
|
|
|
|
|
|
For the periods
ended September30
|
|
|
2018
|
|
2019
|
Income (loss) from
operations
|
|
1399.00
|
|
(377.00)
|
Net income (loss)
attributable to JMU Ltd.
|
|
1720.00
|
|
(396.00)
|
|
|
|
|
|
Amortization of
acquired intangible assets
|
a
|
265.00
|
|
0.00
|
Provision for income
tax (benefits)/expenses
|
b
|
(51.00)
|
|
0.00
|
Share-based
compensation
|
c
|
39.00
|
|
0.00
|
Impairment
loss
|
d
|
0.00
|
|
0.00
|
|
|
|
|
|
Non-GAAP income
(loss) from operation (a)(c)(d)
|
|
1095.00
|
|
(377.00)
|
Non-GAAP net income
(loss) attributable to JMU Ltd.(a)(b)(c)(d)
|
|
1467.00
|
|
(396.00)
|
|
|
|
|
|
Note:
|
|
|
|
|
(a)Adjustment to
exclude amortization of acquired intangible assets
|
|
|
|
(b)Adjustment to
exclude income tax (benefits)/expenses
|
|
|
|
|
(c)Adjustment to
exclude share-based compensation
|
|
|
|
|
(d)Adjustment to
exclude impairment loss
|
|
|
|
|
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SOURCE JMU Ltd