21Vianet Shares Drop After Q4 Results

Shares of

dropped more than 4% in pre-market trading after the company reported financial results for the fourth quarter. 21Vianet Group posted a quarterly net loss of RMB155.5 million (US$25.1 million), versus a year-ago net loss of RMB3.9 million. Adjusted net profit slipped to RMB7.1 million (US$1.1 million), from RMB41.0 million. Diluted loss was RMB2.64 (US$0.43) per American Depositary Share in the fourth quarter, while diluted loss per share was US$0.07 per share. Adjusted diluted loss came in at RMB0.18 (US$0.03) per ADS in the quarter. Its net revenue climbed 56.4% to RMB853.9 million (US$137.6 million), compared to RMB545.9 million. Analysts were expecting a profit of 0.26 per share on revenue of $835.92 million. Net revenue from hosting and related services climbed 63.8% to RMB596.2 million (US$96.1 million) in the quarter, while net revenue from managed network services rose 41.6% y/y to RMB257.7 million (US$41.5 million). Gross profit surged 65.0% to RMB238.0 million (US$38.4 million) for the fourth quarter, while gross margin widened to 27.9% from 26.4%. Total operating expenses jumped 162.6% to RMB344.3 million (US$55.5 million) in the fourth quarter, compared to RMB131.1 million in the year-ago period. Adjusted EBITDA gained 55.7% to RMB160.1 million (US$25.8 million) from RMB102.9 million. As of December 31, 2014, 21Vianet Group had RMB1.56 billion (US$250.7 million) in cash and cash equivalents and short-term investment. Mr. Josh Chen, Founder, Chairman and Chief Executive Officer of the Company, said, "We ended 2014 on a strong note, as we saw continued strong growth momentum in our internet data center (IDC), content delivery network (CDN), and cloud businesses. We further expanded our IDC portfolio as we added an additional 3,378 cabinets, allowing our total cabinet count to grow to 21,522, a 53% year-over-year increase." 21Vianet projects Q1 net revenue of RMB883 million to RMB925 million and full-year net revenue of RMB3.91 billion to RMB4.11 billion. 21Vianet shares slipped 4.40% to $16.95 in the after-hours trading session.