On March 13, Beijing time, Wanwuxinsheng (Aihuishou) Group (NYSE: RERE), a leading domestic second-hand consumer electronics trading and service platform, released its fourth-quarter and full-year performance reports for fiscal year 2022.
The financial report shows that in the fourth quarter of 2022, the total revenue of Wanwu Xinsheng Group will be 2.98 billion yuan, a year-on-year increase of 22.4%. In the fourth quarter, All Things Newborn achieved a non-GAAP operating profit of RMB 34.57 million (adjusted, excluding employee equity incentive expenses, amortization of intangible assets and deferred costs arising from acquisitions, deferred costs, goodwill and impairment of intangible assets , the same below), hitting a record high.
Looking at the whole year of 2022, the total revenue of All Things Newborn increased by 26.9% year-on-year to reach 9.87 billion yuan, and the platform's annual second-hand commodity transaction volume reached 32 million orders, with both revenue and business scale hitting new highs. The group's 2022 full-year non-GAAP operating profit is 6.9 million yuan, and the non-GAAP net profit is 50.84 million yuan. Inflow of 200 million yuan. As of the end of 2022, the Group's consolidated cash reserves totaled 2.80 billion yuan.
In the fourth quarter, the revenue hit a new high and the non-GAAP operating level continued to be profitable.
In the fourth quarter of 2022, the revenue of Wanwuxinsheng Group reached a record high of 2.98 billion yuan, a year-on-year increase of 22.4%. From the perspective of revenue composition, despite the adverse impact of the epidemic in the fourth quarter, the sales revenue of 1P (self-operated) products still maintained a relatively high growth rate of 29.5%, reaching 2.69 billion yuan, showing the high degree of certainty of self-operated business. After optimization of platform business efficiency, 3P (platform) service income was 290 million yuan, and the comprehensive platform fee rate was 4.8%.
In terms of profitability, the Group achieved a non-GAAP operating profit of RMB 34.57 million in the fourth quarter, a year-on-year increase of 257.6%. It rose to 1.2%, a record high.
In terms of offline operations, in the fourth quarter, Wanwusheng continued to expand its offline service network, and its stores expanded steadily. As of December 31, 2022, the offline stores of Wanwu Xinsheng Group have covered 266 cities across the country, an increase of 10 compared with the end of the third quarter; 116 new stores were opened in the fourth quarter, and the total number of stores reached 1,920.
(The picture shows Aihuishou offline store)
In 2022, the total revenue will be nearly 10 billion non-GAAP level to achieve full-year profitability
According to the financial report, from the perspective of revenue, the total revenue of All Things New Group will be 9.87 billion yuan in 2022, a year-on-year increase of 26.9%. Among them, 1P business income was 8.68 billion yuan, a year-on-year increase of 30.4%; 3P business income was 1.19 billion yuan, a year-on-year increase of 6.0%. From the perspective of transaction scale, the transaction volume of second-hand goods on the whole platform will reach 32 million in 2022.
In 2022, the Group will further improve its profitability while maintaining a steady growth in revenue. Among them, the non-GAAP operating profit in 2022 is 6.9 million yuan, and the non-GAAP net profit is 50.84 million yuan, which is the first full-year profit at the non-GAAP level. At the same time, the group achieved a positive operating cash flow of 880 million yuan throughout the year, with a net cash flow of 200 million yuan.
As of the end of 2022, the group's cash and cash equivalents, short-term investments and third-party payment platform account balances totaled 2.80 billion yuan, providing financial guarantee for the group's long-term stable operation.
Chen Chen, Chief Financial Officer of All Things Newborn, said: "Although the epidemic situation in the fourth quarter has affected the operating hours of stores and the supply chain, we still rely on our supply chain capabilities to lock in high-quality sources of goods, maintain the stability of the supply of self-operated products, and pass compliance. The maintenance technology increases the supply of standardized products and improves the profit margin of the industrial chain. In terms of platform business, we continue to optimize the platform user structure and marketing strategy, and the platform's comprehensive charging rate has risen steadily to 4.8%. As of December 31, 2022, the Group's comprehensive The cash reserve is 2.8 billion yuan, and the net cash inflow from operating activities during the year is 880 million yuan, forming a solid financial guarantee for sustainable long-term development and stock repurchases in the new year. Looking forward to 2023, we believe that the new development track of the macro economy will be The development of the group has injected new vitality, and we are confident in the non-GAAP operating profit in the first quarter of 2023 and the full year."
Continue to invest in automation capacity building and steadily promote the "multi-category" strategy
In 2022, the new life of all things will continue to drive development with technological innovation, and promote the automation of quality inspection capabilities and the digitization of supply chain capabilities. Based on years of technology accumulation, All Things Newborn accelerates the R&D and implementation of automation equipment. During the reporting period, the South China (Dongguan) Automation Operation Center, the largest and most automated operation center of the Group, was officially put into use. By the end of 2022, Wanwuxinsheng has established an efficient and coordinated automated disposal network system, including 8 regional operation centers, located in Dongguan, Changzhou, Wuhan, Chengdu, Tianjin, Xi'an, Shenyang and Hong Kong, China.
On the one hand, the launch of the automated operation system has helped to reduce costs and increase efficiency, coupled with the improvement in the standardization of store recycling and delivery processes brought about by the digital management system, and achieved a year-by-year decline in the non-GAAP performance expense ratio, from 13.7% in 2020 Reduce to 12.9% in 2021, and further reduce to 10.9% in 2022; on the other hand, provide consumers and merchants with a more convenient, high-quality, and fast-acting second-hand electronic product trading experience, and at the same time promote the second-hand 3C industry to become intelligent , large-scale, and low-carbon operation upgrades.
(The picture shows the newborn Dongguan Automation Operation Center)
While consolidating the competitiveness of the second-hand 3C market and increasing the penetration rate, Wanwuxinsheng Group will focus on promoting the "multi-category" strategy from the second quarter of 2022, that is, in addition to the core mobile phone 3C recycling business, it will add video equipment and bags to its stores. , watches, gold, famous wine, shoes and clothing, etc., and provide value-added services such as trade-in, to better meet the various recycling needs of users, and to continuously improve the efficiency of stores. As of the end of 2022, multi-category business has been opened in 63 stores in 14 cities across the country, boosting the performance growth of pilot stores. After adding multi-category business, the average monthly transaction volume of each pilot store increased by 300,000 yuan.
While actively promoting multi-category business, All Things Newborn is based on the "old-for-new" model, deepens brand cooperation, and optimizes user services. In the third quarter, the Group collaborated with JD.com to upgrade the trade-in service again, supporting the trade-in of mobile phones, computer digital, home appliances and other cross-categories, providing users with a more affordable shopping experience and promoting the recycling of idle electronic products. In addition to the cooperation with JD.com, All Things New has also reached a strategic cooperation with the world's leading mobile phone consumer electronics brand for trade-in. Through this strategic cooperation, the Group's 1P recycling supply chain's service capabilities for retail scenarios will be extended, and the recycling penetration rate and user satisfaction in first- and second-tier cities will be boosted.
Adhere to the road of circular economy and practice corporate social responsibility
In 2022, under the background of the "dual carbon" goal, industrial policies favorable to the development of circular economy will be released one after another, which will give birth to new opportunities for industrial development, and the circular economy will enter the fast lane.
In January 2022, the National Development and Reform Commission and other departments jointly issued the "Implementation Plan for Promoting Green Consumption", which requires strengthening green consumption technology and service support, and expanding the sharing and utilization of idle resources and second-hand trading channels. In August 2022, nine departments including the Ministry of Science and Technology jointly issued the "Science and Technology Support Carbon Peak Carbon Neutralization Implementation Plan (2022-2030)", proposing to establish a more complete green and low-carbon technology innovation system. In addition to the national level, various provinces and cities have also intensively issued a series of policies to promote the development of circular economy industries, and made specific action arrangements in the field of circular economy.
As an "Internet + environmental protection" type of circular economy enterprise, besides focusing on its main business, Wanwusheng adheres to the green circular economy development model and is committed to realizing the unity of business practice and social and environmental values. In 2022, the transaction volume of second-hand commodities on the whole platform of Wanwuxinsheng Group will reach 32 million. By extending the life cycle of second-hand consumer electronics products, it will effectively reduce carbon emissions and environmental pollution in the consumer sector. In addition, the new life of all things is also actively exploring low-carbon operating models. Taking Dongguan Automation Operation Center as an example, its highest single-day carbon emission reduction is about 1095 tons.
In addition, as an innovator and leader in the second-hand industry, All Things Newborn actively participates in public welfare activities and undertakes corporate social responsibilities. In 2018, Wanwuxinsheng launched the public welfare project "Recycling Love·Mountain Village Children's Digital Education Program", which aims to collect idle electronic equipment in the city and make targeted donations, build an online teaching system in mountain villages, and help mountain village children through digital online education They expand horizons and extend the life of electronic equipment. As of the end of 2022, the program has supported 56 schools, completed 2,068 hours of teaching, and helped 10,770 students.
Chen Xuefeng, Chairman of the Board of Directors and CEO of All Things Newborn, said: "The external environment in the fourth quarter of 2022 will be full of challenges again, but our team has risen to the challenge and achieved a number of important performance indicators as scheduled-the revenue in the fourth quarter has reached a new high , an increase of 22.4% year-on-year to 2.98 billion yuan, and an adjusted operating profit of nearly 34.6 million yuan; the annual non-GAAP operating profit was 6.9 million yuan. Looking back on 2022, we will put the health of employees and users first and actively respond to the epidemic The operational challenges brought about by repeated operations, and the improvement of efficiency with solid technology-driven supply chain capabilities have proved our own profitability. Looking forward to 2023, we will continue to promote the increase in the penetration rate of the mobile phone 3C recycling market. Continue to make efforts in multi-category recycling, and bring continuous value creation to users, the environment and shareholders in the long cycle of circular economy."