Jiayuan Announces Fourth Quarter and Full Year 2014 Financial Results

BEIJING, March 5, 2015 /PRNewswire/ -- Jiayuan.com International Ltd. ("Jiayuan") DATE, operator of the largest online dating platform in China, today announced its unaudited financial results for the fourth quarter and full year ended December 31, 2014.

Fourth Quarter 2014 Highlights[1]

• Net revenues for the fourth quarter 2014 were RMB172.8 million (US$27.9 million), a year-over-year increase of 29.9%.
• Operating income for the fourth quarter 2014 was RMB14.5 million (US$2.3 million), compared to RMB17.8 million for the corresponding quarter of 2013. Excluding share-based compensation, non-GAAP[2] operating income for the fourth quarter 2014 was RMB19.1 million (US$3.1 million), representing a year-over-year increase of 6.4% from RMB18.0 million for the corresponding quarter of 2013.
• Net income for the fourth quarter 2014 was RMB19.2 million (US$3.1 million), compared to RMB25.0 million for the corresponding quarter of 2013. Excluding share-based compensation, non-GAAP net income for the fourth quarter of 2014 was RMB23.8 million (US$3.8 million), compared to RMB25.2 million for the corresponding quarter of 2013.

Full Year 2014 Highlights

• Net revenues for full year 2014 were RMB614.0 million (US$99.0 million), a year-over-year increase of 24.6%.
• Operating income for full year 2014 was RMB2.2 million (US$361,000), compared to RMB54.0 million for the previous year. Excluding share-based compensation, non-GAAP operating income for full year 2014 was RMB11.8 million (US$1.9 million), compared to RMB64.4 million in the previous year.
• Net income for full year 2014 was RMB20.1 million (US$3.2 million), compared to RMB63.7 million for the previous year. Excluding share-based compensation, non-GAAP net income for full year 2014 was RMB29.7million (US$4.8 million), compared to RMB74.1 million for the previous year.

"We finished 2014 with a very strong quarter, handedly beating guidance for the quarter and the year as our business continues to pick up speed," commented Mr. Linguang Wu, Chief Executive Officer of Jiayuan. "Growth came from our personalized matchmaking services which increased 205.3% year-over-year as we continue to expand service locations and further build out our brand with the launch of another extensive nationwide advertising campaign. With personalized matchmaking growing so quickly, we have temporarily de-emphasized the monetization of our online services in favor of a more rapid transition to our mobile products which accounted for 69.4% of total logins in the quarter, and in particular our shift to chat based communications which increases user stickiness to our platform."

Mr. Wu added, "Looking forward to 2015, our focus for personalized matchmaking services will shift to supporting same store sales growth through further improvements to our CRM system and increased staff training. Leveraging Jiayuan's outstanding brand and China's largest database of available singles, our local partners are rapidly learning to better utilize resources as they become increasingly more confident in their ability to sell our services and expand our business."

Mr. Shang Koo, Chief Financial Officer of Jiayuan commented, "We expect to see personalized matchmaking services continue to grow at a rapid pace as we scale this business and put more focus on same store sales growth. We also just launched another TV branding campaign which we expect will result in selling and marketing expenses to increase next quarter before our focus switches back to profitability for the remaining three quarters of 2015."

Fourth Quarter 2014 Operational Results

The number of average monthly active user accounts[3] for the fourth quarter 2014 was 5,405,739, an increase of 9.9% from 4,920,553 in the corresponding period of 2013.

The number of average monthly paying user accounts[4] for the fourth quarter 2014 was1,526,397, an increase of 10.4% from1,382,873 in the corresponding period of 2013.

Average monthly revenue per paying user ("ARPU") for online services for the fourth quarter 2014 was RMB21.8, down 13.5% from RMB25.3 for the corresponding period in 2013.

Fourth Quarter 2014 Financial Results

Jiayuan reported net revenues of RMB172.8 million (US$27.9 million) for the fourth quarter of 2014, representing a year-over-year increase of 29.9% from RMB133.1 million, and a sequential increase of 7.0% from RMB161.6 million from the third quarter. Both the year-over-year and sequential increase were primarily due to the rapid expansion of personalized matchmaking services.

• Online services contributed RMB105.4 million (US$17.0 million), or 61.0% of net revenues for the fourth quarter of 2014, compared to RMB107.7 million for the previous year, and RMB106.5 million for the previous quarter. The slight year-over-year and sequential decrease were primarily due to the growing number of mobile users who prefer micro payments and contribute lower ARPU.
• Personalized matchmaking services contributed RMB60.0 million (US$9.7million), or 34.7% of net revenues for the fourth quarter of 2014, representing a year-over-year increase of 205.3% from RMB19.7 million, and a quarter-over-quarter increase of 21.3% from RMB49.5 million. Both the year-over-year and sequential increase were attributable to the expanded number of service locations and cities in which the Company offers personalized matchmaking services, as well as sales growth of existing service locations.
• Events and others contributed RMB7.4 million (US$1.2 million), or 4.3% of net revenues for the fourth quarter of 2014, representing a year-over-year increase of 28.0% from RMB5.8 million, and a sequential increase of 33.3% from RMB5.5 million for the previous quarter. The year-over-year and sequential increase were mainly attributable to the increased sponsorships the Company introduced for events and an online payment collaboration with Baidu.

Cost of revenues for the fourth quarter of 2014 was RMB86.7 million (US$14.0 million), representing a year-over-year increase of 65.9% from RMB52.3 million and an increase of 16.4% from RMB74.5 million for the previous quarter. Both the year-over-year and sequential increase were primarily due to the increased investment in personalized matchmaking services in line with the revenue growth. 

Gross profit for the fourth quarter of 2014 was RMB86.1 million (US$13.9 million), representing a year-over-year increase of 6.6% from RMB80.8 million and a slight decrease of 1.1% from RMB87.1 million for the previous quarter.

Selling and marketing expenses were RMB49.3 million (US$8.0 million) for the fourth quarter of 2014, representing a year-over-year increase of 11.4% from RMB44.3 million and a quarter-over-quarter decrease of 24.0% from RMB64.9 million. The year-over-year increase was mainly due to the rising cost per advertisement. The sequential decrease was due to a special marketing campaign for Chinese Valentine's Day in the third quarter.

General and administrative expenses were RMB15.5 million (US$2.5 million) for the fourth quarter of 2014, representing a year-over-year increase of 20.7% from RMB12.8 million for the fourth quarter of 2013 and a sequential decrease of 2.9% from RMB15.9 million for the previous quarter. The year-over-year increase was primarily attributable to the increase in employee stock option expenses. The sequential decrease was primarily related to the decrease in travelling expenses.

Research and development expenses were RMB6.8 million (US$1.1 million) for the fourth quarter of 2014, representing a year-over-year increase of 14.4% from RMB5.9 million for the corresponding quarter of 2013 and a quarter-over-quarter increase of 14.8% from RMB5.9 million for the third quarter of 2014.The year-over-year and sequential increases were primarily due to the growth in the number of research and development personnel in connection with Jiayuan's focus on improving user experience and mobile expansion.

Operating income for the fourth quarter of 2014 was RMB14.5 million (US$2.3 million), compared to RMB17.8 million for the corresponding quarter of 2013, and representing a sequential increase of 4,662.0% from RMB305,000 in the previous quarter. The year-over-year decrease was primarily due to the increase in selling and marketing expenses. The sequential increase was primarily due to the decrease in selling and marketing expenses. Excluding share-based compensation expenses, non-GAAP operating income for the fourth quarter of 2014 was RMB19.1 million (US$3.1 million), an increase of 6.4% from RMB18.0 million for the corresponding quarter of 2013 and an increase of 783.0% from RMB2.2 million for the previous quarter.

Foreign currency exchange net gain for the fourth quarter of 2014 was RMB242,000 (US$39,000), compared to a foreign currency exchange net gain of RMB616,000 for the corresponding quarter of 2013 and a foreign currency exchange net loss of RMB172,000 for the previous quarter. The foreign currency exchange net gain for the fourth quarter of 2014 was mainly attributable to RMB appreciation against the U.S. dollar during the period. Part of the proceeds from Jiayuan's IPO has been converted into RMB and is being held by its overseas entities whose functional currencies are the U.S. dollar.

Net income for the fourth quarter of 2014 was RMB19.2 million (US$3.1 million), compared to RMB25.0 million for the corresponding quarter of 2013 and representing a sequential increase of 563.2% from RMB2.9 million for the previous quarter. Excluding share-based compensation expenses, non-GAAP net income for the fourth quarter of 2014 was RMB23.8 million (US$3.8 million), a slight decrease of 5.5% from RMB25.2 million for the corresponding quarter of 2013 and an increase of 400.6% from RMB4.8 million for the previous quarter.

Basic and diluted net income per ADS[5] for the fourth quarter of 2014 were RMB0.65 (US$0.11) and RMB0.64 (US$0.10), respectively, compared to basic and diluted net income per ADS of RMB0.83 and RMB0.82 for the corresponding quarter of 2013, and basic and diluted net income per ADS of RMB0.10 and RMB0.10, respectively, for the third quarter of 2014.

Excluding share-based compensation expenses, non-GAAP basic and diluted net income per ADS for the fourth quarter of 2014 were RMB0.81 (US$0.13) and RMB0.79 (US$0.13), respectively, compared to RMB0.84 and RMB0.83 for the corresponding quarter of 2013 and non-GAAP basic and diluted net income per ADS of RMB0.16 and RMB0.16, respectively, for the third quarter of 2014.

As of December 31, 2014, Jiayuan had cash and cash equivalents and short-term deposits of RMB436.3 million (US$70.3 million). Cash flows from operating activities for the fourth quarter of 2014 were RMB18.7 million (US$3.0 million).

The weighted average number of ADSs outstanding used in calculating diluted net income per ADS and non-GAAP diluted net income per ADS in the fourth quarter of 2014 was 30.0 million. As of December 31, 2014, the Company had 33.3 million ADSs outstanding, including 0.4 million ADSs issued to the depository for future exercise of options.

Full Year 2014 Financial Results[6]

Jiayuan reported net revenues of RMB614.0 million (US$99.0 million) for full year 2014, representing an increase of 24.6% from RMB492.6 million for full year 2013, primarily due to the strong growth in Jiayuan's personalized matchmaking services.

• Online services contributed RMB425.5 million (US$68.6 million), or 69.3% of net revenues for full year 2014, representing an increase of 0.8% from RMB422.1 million for the previous year due to the steady increase in paying user accounts.
• Personalized matchmaking services contributed RMB164.6 million (US$26.5 million), or 26.8% of net revenues for full year 2014, representing an increase of 213.8% from RMB52.5 million for the previous year due to the expansion in the number of service locations and growth in same store sales of existing locations.
• Events and others contributed RMB23.8 million (US$3.8 million), or 3.9% of net revenues for full year 2014, representing an increase of 32.0% from RMB18.1 million for the previous year due to the increase in events sponsorships that Jiayuan received and an online payment collaboration with Baidu.

Cost of revenues for full year 2014 was RMB277.8 million (US$44.8 million), representing an increase of 53.9% from RMB180.5 million from the previous year. This increase was primarily attributable to the continued development of Jiayuan's online business as well as the rapid expansion of personalized matchmaking services.

Gross profit for full year 2014 was RMB336.2 million (US$54.2 million), representing an increase of 7.7% from RMB312.1 million for the previous year.

Selling and marketing expenses were RMB252.7 million (US$40.7 million) for full year 2014, representing an increase of 37.6% from RMB183.6 million for the previous year. The increase was mainly attributable to the increased marketing activities and the rise in cost per advertisement.

General and administrative expenses were RMB58.1 million (US$9.4 million) for the full year 2014, representing an increase of 10.5% from RMB52.6 million for the previous year. The year-over-year increase was primarily due to the increase in human resources costs.

Research and development expenses were RMB23.1 million (US$3.7 million) for full year 2014, representing an increase of 5.6% from RMB21.9 million for the previous year. This increase was primarily due to continued investment in research and development pertaining to new products and features designed to enhance the user experience.

Operating income for full year 2014 was RMB2.2 million (US$361,000), compared to RMB54.0 million for the previous year, which was primarily attributable to the increase in selling and marketing expenses. Excluding share-based compensation expenses, non-GAAP operating income for full year 2014 was RMB11.8 million (US$1.9 million), compared to RMB64.4 million for the previous year.

Foreign currency exchange net loss for full year 2014 was RMB1.4 million (US$219,000), compared to foreign currency exchange net gain of RMB1.9 million for the previous year. The foreign currency exchange net loss for full year 2014 was mainly attributable to RMB depreciation against the U.S. dollar during the year. Part of the proceeds from Jiayuan's IPO has been converted into RMB and is being held by its overseas entities whose functional currencies are the U.S. dollar.

Net income for full year 2014 was RMB20.1 million (US$3.2 million), compared to RMB63.7 million for the previous year. Excluding share-based compensation expenses, non-GAAP net income for full year 2014 was RMB29.7 million (US$4.8 million), compared to RMB74.1 million for the previous year.

Basic and diluted net income per ADS for full year 2014 were RMB0.68 (US$0.11) and RMB0.66 (US$0.11), respectively, compared to basic and diluted net income of RMB2.13 and RMB2.08, respectively, for the previous year.

Excluding share-based compensation expenses, non-GAAP basic and diluted net income per ADS for full year 2014 were RMB1.00 (US$0.16) and RMB0.98 (US$0.16), respectively, compared to non-GAAP basic and diluted net income per ADS of RMB2.47 and RMB2.42 for the previous year.

First Quarter 2015 Outlook

Jiayuan currently expects to generate net revenues in the range of RMB164 million to RMB 166 million for the first quarter of 2015. This forecast reflects Jiayuan's current and preliminary view, which is subject to change.

Conference Call Information

The Company's management team will hold an earnings conference call at 8:00 a.m. on March 5, 2014, U.S. Eastern Standard Time (9:00 p.m. Beijing / Hong Kong Time on the same day).

Dial-in details for the earnings conference call are as follows:

A replay of the conference call may be accessed by phone at the following number until March 12, 2015:

A live and archived webcast of the conference call will be available at http://ir.jiayuan.com.

About Jiayuan

Jiayuan.com International Ltd. ("Jiayuan") DATE operates the largest online dating platform in China. Jiayuan is committed to providing a trusted, effective, and user-focused online dating platform that addresses the dating and marriage needs of China's rapidly growing urban singles population. As a pioneer in China's online dating market, Jiayuan ranks first in terms of number of unique visitors, average time spent per user and average page views per user among all online dating websites in China in 2014, according to iResearch. Jiayuan recorded an average of 5.4 million monthly active user accounts in the fourth quarter of 2014. Every two of Jiayuan's American Depositary Shares represent three ordinary shares.

For more information, please visit http://ir.jiayuan.com.

Forward-Looking Statements

This 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. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates," "confident" and similar statements. Jiayuan may also make written or verbal forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission, in its annual report to shareholders, in press releases and other written materials and in verbal statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about our beliefs and expectations, are 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: our growth strategies; our future business development, including development of new products and services; our ability to attract and retain users; competition in the Chinese online dating markets; changes in our revenues and certain cost or expense items as a percentage of our revenues; the outcome of any litigation or arbitration; the expected growth of the number of Internet and broadband users in China; Chinese governmental policies relating to the Internet and online dating websites and general economic conditions in China and elsewhere. Further information regarding these and other risks is included in our documents filed with the U.S. Securities and Exchange Commission. Jiayuan does not undertake any obligation to update any forward-looking statement, except as required under applicable law. All information provided in this press release is as of the date of the press release, and Jiayuan undertakes no duty to update such information, except as required under applicable law.

Non-GAAP Financial Measures

We disclose non-GAAP financial measures of operating income, net income and net income per ADS, each of which is adjusted to exclude share-based compensation expense. We review non-GAAP financial measures to obtain an additional understanding of our operating performance. We also believe it is useful supplemental information for investors and analysts to assess our operating performance without the effect of non-cash share-based compensation expense, which have been and will continue to be significant recurring expenses in our business. For a reconciliation of each of these non-GAAP financial measures to the most directly comparable GAAP financial measures, please see "Reconciliation To Unaudited Condensed Consolidated Statement of Comprehensive Income" included in this press release.

However, the use of non-GAAP financial measures has material limitations as an analytical tool. One of the limitations of using non-GAAP financial measures is that it does not include all items that impact our non-GAAP financial measures during the period. In addition, because non-GAAP financial measures are not calculated in the same manner by all companies, it may not be comparable to other similar titled measures used by other companies. In light of the foregoing limitations, you should not consider non-GAAP financial measures in isolation from or as an alternative to GAAP financial measures. Management compensates for this limitation by providing specific information regarding the GAAP amount excluded from the non-GAAP measure.

For investor and media inquiries, please contact:

China

Shirley Zhang
Jiayuan.com International Ltd.
+86 (10) 6442-2321
ir@jiayuan.com

Mr. Christian Arnell
Christensen Investor Relations
+86-10-5900-1548
carnell@christensenir.com

US

Ms. Linda Bergkamp
+1-480-614-3004
Email: lbergkamp@Christensenir.com

 

 

 

 

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SOURCE Jiayuan.com International Ltd.