Ruixing expects that in the third quarter of this year, the company will move toward the break-even point of store operation.
On August 14, Ruixun Coffee (NASDAQ: LK) handed in the first transcript after listing.
The financial report shows that Ruixing Coffee’s total revenue in the second quarter was RMB 909.1 million, a year-on-year increase of 648.2%. Compliant with Bloomberg90 million yuan. Span>; compared with the first quarter, revenue was 480 million yuan, indicates that Ruixing has nearly doubled in a quarter. Among them, Ruixing coffee products net income was 870 million, an increase of 698.4%, and the average monthly sales of goods was 27.6 million.
The net loss was RMB 681.3 million, compared with 333 million yuan in the same period of last year. loss expansion more than doubled;< /strong> The previous quarter’s 550 million yuan, loss continues to expand. After adjustment, the net loss per ADS0.82 yuan, below analysts’ estimate of 3.6 yuan.
It should be noted that since Ruixing was the first financial report listed, only three analysts made predictions. The data is for reference only and is not enough to represent the consensus of the market.
The reason why the loss has not narrowed but expanded has been that “rapidly occupying the market through subsidies” is still the main theme of Ruixing. As early as the beginning of the coffee market, Rui Xing had said that he would make long-term losses and make coffee that the Chinese could afford. In the past two quarters, Ruisheng subsidies were even worse. The result of these money burns is: Ruisheng cumulative trading users surged from 2.9 million in the same period last year to 22.8 million, compared with 5.9 million new transactions in the previous quarter; the average monthly activity in the quarter was 6.2 million , a year-on-year increase of 410.6%.
With the growth of new users, Ruixing’s expansion rate in stores is also crazy. During the financial period, the total number of Ruixingmen stores was 2,963, an increase of 374.8% from 2,370 in the previous quarter. In Ruixing’s plan, the company will build more than 4,500 total stores by the end of 2019, surpassing Starbucks to become China’s largest coffee chain brand, and build 10,000 stores by the end of 2021.
But while Ruisheng is crazy, he is gradually becoming awake – the company can’t stopStop losses, after all, it is necessary to consider profit. In this quarter’s financial report, Rui Xing first mentioned the profit-related plan: By the third quarter of this year, Rui Xing will move toward the break-even point of store operation. In the past two quarters, Ruixing has achieved initial results, coffee shop operating loss of 55.8 million yuan, down 31.7 from 81.7 million yuan in the same period last year %, close to the breakeven point.
Despite the current, Rui Xun coffee’s aggressive expansion strategy has caused it to suffer huge losses for a long time and is criticized by the market, but Wall Street still chooses to be optimistic about Ruixing. Before the financial report was released, Rui Xing’s documents submitted to the US SEC showed that Wall Street’s top hedge fund Point72 had increased its holding of Ruixing Coffee, holding more than 5%. According to Bloomberg data, private equity giant Capital Group’s fund holds 15.57% of Ruixing, Qatar sovereign wealth fund QIA holds 7.77%, followed by Darsana, Point72 and Melvin.
Reviewing the stock price change of Ruixing listed for 3 months, the listing opened up 47% on the first day of trading, closing at 19.88% compared with the issue price of 17 dollars, but on the fourth day of Below the issue price, shares fell nearly 15%, and the lowest fell to $13.7. However, in the past July, Ruixing’s share price rose by 25%, while the S&P 500 index returned 1.4%.
As of press time, Ruisheng’s share price was reported at US$23.45, a decrease of 4.48% and a market value of US$5.709 billion. Ruisheng expects that by the third quarter of this year, the net income of Ruixing coffee products will reach 1.35.45 billion yuan.
Rui Xun Coffee founder and CEO Qian Zhiya said that in the future, Ruixun Coffee will continue to invest in brands and technologies, enrich product lines, and strengthen supply chain management to achieve the 2019 annual strategic goal.