PR Newswire | May 19, 2021 06:01AM EDT

05/19 05:00 CDT

Vipshop Reports Unaudited First Quarter 2021 Financial ResultsConference Call to Be Held at 7:30 A.M. U.S. Eastern Time on May 19, 2021 GUANGZHOU, China, May 19, 2021

GUANGZHOU, China, May 19, 2021 /PRNewswire/ -- Vipshop Holdings Limited (NYSE: VIPS), a leading online discount retailer for brands in China ("Vipshop" or the "Company"), today announced its unaudited financial results for the first quarter ended March 31, 2021.

First Quarter 2021 Highlights

* Total net revenue for the first quarter of 2021 increased by 51.1% year over year to RMB28.4 billion (US$4.3 billion) from RMB18.8 billion in the prior year period. * GMV[1] for the first quarter of 2021 increased by 59% year over year to RMB46.1 billion from RMB28.9 billion in the prior year period. * Gross profit for the first quarter of 2021 increased by 54.7% year over year to RMB5.6 billion (US$853.9 million) from RMB3.6 billion in the prior year period. * Net income attributable to Vipshop's shareholders for the first quarter of 2021 increased by 125.7% year over year to RMB1.5 billion (US$235.9 million) from RMB684.8 million in the prior year period. * Non-GAAP net income attributable to Vipshop's shareholders[2] for the first quarter of 2021 increased by 73.7% year over year to RMB1.7 billion (US$261.4 million) from RMB986.1 million in the prior year period. * The number of active customers[3] for the first quarter of 2021 increased by 54% year over year to 45.8 million from 29.6 million in the prior year period. * Total orders[4] for the first quarter of 2021 increased by 44% year over year to 175.5 million from 121.7 million in the prior year period.

Mr. Eric Shen, Chairman and Chief Executive Officer of Vipshop, stated, "We are glad to have delivered another quarter of strong financial and operational results in the first quarter of 2021. Our number of active customers for the quarter grew by 54% year over year to 45.8 million from 29.6 million in the same period last year, demonstrating continued robust customer acquisition trends. We are keenly focused on strengthening our leadership in China's discount retail market through the solid execution of our merchandising strategy. Our close and long-term relationships with our key suppliers in apparel-related categories give us the advantage in continuing to deepen our collaboration with them through Made-for-Vipshop products, which will further differentiate us from other marketplace platforms and increase the stickiness of our customers over time."

Mr. David Cui, Chief Financial Officer of Vipshop, further commented, "During the first quarter of 2021, we delivered strong topline growth and solid profitability, driven by the robust growth in the number of active customers. In addition, we generated robust free cash inflow of RMB10.1 billion for the trailing twelve months ended March 31, 2021, as compared with RMB2.3 billion in the prior year period. Looking ahead, we will continue to balance our topline and bottom-line growth, aiming to grow as fast as possible while keeping our margins stable. We are committed to delivering long-term, sustainable shareholder value."

First Quarter 2021 Financial Results

REVENUE

Total net revenue for the first quarter of 2021 increased by 51.1% year over year to RMB28.4 billion (US$4.3 billion) from RMB18.8 billion in the prior year period, primarily driven by the growth in the number of total active customers.

GROSS PROFIT

Gross profit for the first quarter of 2021 increased by 54.7% year over year to RMB5.6 billion (US$853.9 million) from RMB3.6 billion in the prior year period. Gross margin for the first quarter of 2021 increased to 19.7% from 19.2% in the prior year period.

OPERATING EXPENSES

Total operating expenses for the first quarter of 2021 were RMB4.4 billion (US$668.7 million), as compared with RMB3.0 billion in the prior year period. As a percentage of total net revenue, total operating expenses for the first quarter of 2021 decreased to 15.4% from 15.9% in the prior year period.

* Fulfillment expenses for the first quarter of 2021 were RMB1.8 billion (US$273.7 million), as compared with RMB1.4 billion in the prior year period. As a percentage of total net revenue, fulfillment expenses for the first quarter of 2021 decreased to 6.3% from 7.4% in the prior year period. * Marketing expenses for the first quarter of 2021 were RMB1.3 billion (US$197.5 million), as compared with RMB412.3 million in the prior year period. As a percentage of total net revenue, marketing expenses for the first quarter of 2021 were 4.6%, as compared with 2.2% in the prior year period, primarily attributable to increased investment in advertising activities relating to customer acquisition and retention. * Technology and content expenses for the first quarter of 2021 decreased to RMB337.5 million (US$51.5 million) from RMB338.4 million in the prior year period. As a percentage of total net revenue, technology and content expenses for the first quarter of 2021 decreased to 1.2% from 1.8% in the prior year period. * General and administrative expenses for the first quarter of 2021 were RMB956.7 million (US$146.0 million), as compared with RMB839.2 million in the prior year period. As a percentage of total net revenue, general and administrative expenses for the first quarter of 2021 decreased to 3.4% from 4.5% in the prior year period.

INCOME FROM OPERATIONS

Income from operations for the first quarter of 2021 increased by 93.2% year over year to RMB1.5 billion (US$230.7 million) from RMB782.2 million in the prior year period. Operating margin for the first quarter of 2021 increased to 5.3% from 4.2% in the prior year period.

Non-GAAP income from operations[5]for the first quarter of 2021, which excluded share-based compensation expenses and amortization of intangible assets resulting from business acquisitions, increased by 66.0% year over year to RMB1.7 billion (US$265.2 million) from RMB1.0 billion in the prior year period. Non-GAAP operating income margin[6] for the first quarter of 2021 increased to 6.1% from 5.6% in the prior year period.

NET INCOME

Net income attributable to Vipshop's shareholders for the first quarter of 2021 increased by 125.7% year over year to RMB1.5 billion (US$235.9 million) from RMB684.8 million in the prior year period. Net margin attributable to Vipshop's shareholders for the first quarter of 2021 increased to 5.4% from 3.6% in the prior year period. Net income attributable to Vipshop's shareholders per diluted ADS[7] for the first quarter of 2021 increased to RMB2.18(US$0.33) from RMB1.00 in the prior year period.

Non-GAAP net income attributable to Vipshop's shareholders for the first quarter of 2021, which excluded (i) share-based compensation expenses, (ii) impairment loss of investments, (iii) amortization of intangible assets resulting from business acquisitions, (iv) tax effect of amortization of intangible assets resulting from business acquisitions, (v) investment gain and revaluation of investments excluding dividends, (vi) tax effect of investment gain and revaluation of investments excluding dividends, and (vii) share of loss (gain) in investment of limited partnerships that are accounted for as equity method investees, increased by 73.7% year over year to RMB1.7 billion (US$261.4 million) from RMB986.1 million in the prior year period. Non-GAAP net margin attributable to Vipshop's shareholders[8] for the first quarter of 2021 increased to 6.0% from 5.2% in the prior year period. Non-GAAP net income attributable to Vipshop's shareholders per diluted ADS[9] for the first quarter of 2021 increased to RMB2.41(US$0.37) from RMB1.44 in the prior year period.

For the quarter ended March 31, 2021, the Company's weighted average number of ADSs used in computing diluted income per ADS was 709,213,000.

BALANCE SHEET AND CASH FLOW

As of March 31, 2021, the Company had cash and cash equivalents and restricted cash of RMB15.1 billion (US$2.3 billion) and short term investments of RMB3.7 billion (US$568.2 million).

For the quarter ended March 31, 2021, net cash used in operating activities was RMB439.0 million (US$67.0 million), and free cash flow[10], a non-GAAP measurement of liquidity, was as follows:

For the three months ended

Mar 31, Mar 31, Mar 31, 2020 2021 2021



RMB'000 RMB'000 US$'000

Net cash used in operating activities (1,698,611) (439,020) (67,008)

Reconciling items: (645,838) (53,855) (8,220) Net impact from Internet financingactivities^[11]

Capital expenditures (692,045) (733,448) (111,946)

Free cash outflow (3,036,494) (1,226,323) (187,174)

For the trailing twelve months ended

Mar 31, Mar 31, Mar 31, 2020 2021 2021



RMB'000 RMB'000 US$'000

Net cash from operating activities 6,266,508 13,080,035 1,996,403

Reconciling items: (104,832) (634,484) (96,841) Net impact from Internet financingactivities^[11]

Capital expenditures (3,888,818) (2,313,299) (353,078)

Free cash inflow 2,272,858 10,132,252 1,546,484

Business Outlook

For the second quarter of 2021, the Company expects its total net revenue to be between RMB28.9 billion and RMB30.1 billion, representing a year-over-year growth rate of approximately 20% to 25%. These forecasts reflect the Company's current and preliminary view on the market and operational conditions, which is subject to change.

Exchange Rate

The Company's business is primarily conducted in China and the significant majority of revenues generated are denominated in Renminbi. This announcement contains currency conversions of Renminbi amounts into U.S. dollars solely for the convenience of the reader. Unless otherwise noted, all translations from Renminbi to U.S. dollars are made at a rate of RMB6.5518 to US$1.00, the effective noon buying rate on March 31, 2021 as set forth in the H.10 statistical release of the Federal Reserve Board. No representation is made that the Renminbi amounts could have been, or could be, converted, realized or settled into U.S. dollars at that rate on March 31, 2021, or at any other rate.

Conference Call Information

The Company will hold a conference call on Wednesday, May 19, 2021 at 7:30 am Eastern Time or 7:30 pm Beijing Time to discuss its financial results and operating performance for the first quarter of 2021.

All participants wishing to join the conference call must pre-register online using the link provided below. Once pre-registration has been complete, participants will receive dial-in numbers, a passcode, and a unique registrant ID. To join the conference, simply dial the number in the calendar invite you receive after pre-registration, enter the passcode followed by your PIN, and you will join the conference instantly.

Conference ID #7584923

Registration Link http://apac.directeventreg.com/registration/event/7584923

The replay will be accessible through May 27, 2021 by dialing the following numbers:

United States Toll Free: +1-855-452-5696

International: +61-2-8199-0299

Conference ID: #7584923

A live and archived webcast of the conference call will also be available at the Company's investor relations website at http://ir.vip.com.

About Vipshop Holdings Limited

Vipshop Holdings Limited is a leading online discount retailer for brands in China. Vipshop offers high quality and popular branded products to consumers throughout China at a significant discount to retail prices. Since it was founded in August 2008, the Company has rapidly built a sizeable and growing base of customers and brand partners. For more information, please visit www.vip.com.

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 "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Among other things, the business outlook and quotations from management in this announcement, as well as Vipshop's strategic and operational plans, contain forward-looking statements. Vipshop may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (the "SEC"), in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about Vipshop's 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: Vipshop's goals and strategies; Vipshop's future business development, results of operations and financial condition; the expected growth of the online discount retail market in China; Vipshop's ability to attract customers and brand partners and further enhance its brand recognition; Vipshop's expectations regarding demand for and market acceptance of flash sales products and services; competition in the discount retail industry; the potential impact of the COVID-19 to Vipshop's business operations and the economy in China and elsewhere generally; fluctuations in general economic and business conditions in China and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in Vipshop's filings with the SEC. All information provided in this press release is as of the date of this press release, and Vipshop does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

Use of Non-GAAP Financial Measures

The condensed consolidated financial information is derived from the Company's unaudited interim condensed consolidated financial statements prepared in conformity with accounting principles generally accepted in the United States of America ("U.S. GAAP"), except that comparative consolidated statements of income and cash flows for the period presented and detailed footnote disclosures required by Accounting Standards Codification 270, Interim Reporting ("ASC270"), have been omitted. Vipshop uses non-GAAP net income attributable to Vipshop's shareholders, non-GAAP net income attributable to Vipshop's shareholders per diluted ADS, non-GAAP income from operations, non-GAAP operating income margin, non-GAAP net margin attributable to Vipshop's shareholders, and free cash flow, each of which is a non-GAAP financial measure. Non-GAAP net income attributable to Vipshop's shareholders is net income attributable to Vipshop's shareholders excluding (i) share-based compensation expenses, (ii) impairment loss of investments, (iii) amortization of intangible assets resulting from business acquisitions, (iv) tax effect of amortization of intangible assets resulting from business acquisitions, (v) investment gain and revaluation of investments excluding dividends, (vi) tax effect of investment gain and revaluation of investments excluding dividends, and (vii) share of loss (gain) in investment of limited partnerships that are accounted for as equity method investees. Non-GAAP net income attributable to Vipshop's shareholders per diluted ADS is computed using non-GAAP net income attributable to Vipshop's shareholders divided by weighted average number of diluted ADS outstanding for computing diluted earnings per ADS. Non-GAAP income from operations is income from operations excluding share-based compensation expenses and amortization of intangible assets resulting from business acquisitions. Non-GAAP operating income margin is non-GAAP income from operations as a percentage of total net revenue. Non-GAAP net margin attributable to Vipshop's shareholders is non-GAAP net income attributable to Vipshop's shareholders as a percentage of total net revenue. Free cash flow is net cash from operating activities adding back the impact from Internet financing activities and less capital expenditures, which include purchase and deposits of property and equipment and land use rights, and purchase of other assets. Impact from Internet financing activities added back or deducted from free cash flow contains changes in the balances of financial products, which are primarily consumer financing and supplier financing that the Company provides to customers and suppliers. The Company believes that separate analysis and exclusion of the non-cash impact of (a) share-based compensation, (b) impairment loss of investments, (c) amortization of intangible assets resulting from business acquisitions, (d) investment gain and revaluation of investments excluding dividends, and (e) share of loss (gain) in investment of limited partnerships that are accounted for as equity method investees add clarity to the constituent parts of its performance. The Company reviews these non-GAAP financial measures together with GAAP financial measures to obtain a better understanding of its operating performance. It uses these non-GAAP financial measures for planning, forecasting and measuring results against the forecast. The Company believes that non-GAAP financial measures are useful supplemental information for investors and analysts to assess its operating performance without the effect of (1) non-cash share-based compensation expenses, (2) impairment loss of investments, (3) amortization of intangible assets resulting from business acquisitions, (4) investment gain and revaluation of investments excluding dividends, and (5) share of loss (gain) in investment of limited partnerships that are accounted for as equity method investees. Free cash flow enables the Company to assess liquidity and cash flow, taking into account the impact from Internet financing activities and the financial resources needed for the expansion of fulfillment infrastructure and technology platform. Share-based compensation expenses and amortization of intangible assets have been and will continue to be significant recurring expenses in its business. 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 they do not include all items that impact the Company's net income for the period. In addition, because non-GAAP financial measures are not measured in the same manner by all companies, they may not be comparable to other similar titled measures used by other companies. One of the key limitations of free cash flow is that it does not represent the residual cash flow available for discretionary expenditures.

The presentation of these non-GAAP financial measures is not intended to be considered in isolation from, or as a substitute for, the financial information prepared and presented in accordance with U.S. GAAP. For more information on these non-GAAP financial measures, please see the table captioned "Vipshop Holdings Limited Reconciliations of GAAP and Non-GAAP Results" at the end of this release.

Investor Relations Contact

Tel: +86 (20) 2233-0732Email: IR@vipshop.com

[1] "Gross merchandise value (GMV)" is defined as the total Renminbi value ofall products and services sold through the Company's online sales business,online marketplace platform, offline stores, and Shan Shan Outlets during therelevant period, including through the Company's websites and mobile apps,third-party websites and mobile apps, Vipshop offline stores and Vipmaxxoffline stores, as well as Shan Shan Outlets that were fulfilled by either theCompany or its third-party merchants, regardless of whether or not the goodswere delivered or returned. GMV includes shipping charges paid by buyers tosellers. For prudent considerations, the Company does not consider products orservices to be sold if the relevant orders were placed and canceledpre-shipment and only included orders that left the Company's or otherthird-party vendors' warehouses.

^^[2] Non-GAAP net income attributable to Vipshop's shareholders is a non-GAAPfinancial measure, which is defined as net income attributable to Vipshop'sshareholders excluding (i) share-based compensation expenses, (ii) impairmentloss of investments, (iii) amortization of intangible assets resulting frombusiness acquisitions, (iv) tax effect of amortization of intangible assetsresulting from business acquisitions, (v) investment gain and revaluation ofinvestments excluding dividends, (vi) tax effect of investment gain andrevaluation of investments excluding dividends, and (vii) share of loss (gain)in investment of limited partnerships that are accounted for as equity methodinvestees.

[3] "Active customers" is defined as registered members who have purchased fromthe Company's online sales business or the Company's online marketplaceplatforms at least once during the relevant period.

[4] "Total orders" is defined as the total number of orders placed during therelevant period, including the orders for products and services soldthrough the Company's online sales business and the Company's onlinemarketplace platforms (excluding, for the avoidance of doubt, orders from theCompany's offline stores and outlets), net of orders returned.

[5] Non-GAAP income from operations is a non-GAAP financial measure, which isdefined as income from operations excluding share-based compensationexpenses and amortization of intangible assets resulting from businessacquisitions.

[6] Non-GAAP operating income margin is a non-GAAP financial measure, which isdefined as non-GAAP income from operations as a percentage of total netrevenues.

[7] "ADS" means American depositary share, each of which represents 0.2 Class Aordinary share.

[8] Non-GAAP net margin attributable to Vipshop's shareholders is a non-GAAPfinancial measure, which is defined as non-GAAP net income attributable toVipshop's shareholders, as a percentage of total net revenues.

[9] Non-GAAP net income attributable to Vipshop's shareholders per diluted ADSis a non-GAAP financial measure, which is defined as non-GAAP net incomeattributable to Vipshop's shareholders[S:,:S] divided by the weighted averagenumber of diluted ADS outstanding for computing diluted earnings per ADS.

[10] Free cash flow is a non-GAAP financial measure, which is defined as netcash from (used in) operating activities adding back the impact from Internetfinancing activities and less capital expenditures, which include purchase anddeposits of property and equipment and land use rights, and purchase of otherassets.

[11] Net impact from Internet financing activities represents net cash flowrelating to the Company's financial products, which are primarily consumerfinancing and supplier financing that the Company provides to its customers andsuppliers.

Vipshop Holdings Limited

Unaudited Condensed Consolidated Statements of Income and Comprehensive Income

(In thousands, except for share and per share data)

Three Months Ended

March 31,2020 March 31,2021 March 31,2021

RMB'000 RMB'000 USD'000

Product revenues 17,964,195 27,221,752 4,154,851

Other revenues (1) 828,660 1,176,745 179,606

Total net revenues 18,792,855 28,398,497 4,334,457

Cost of revenues (15,175,739) (22,803,674) (3,480,520)

Gross profit 3,617,116 5,594,823 853,937

Operating expenses:

Fulfillment expenses (2) (1,393,690) (1,793,138) (273,686)

Marketing expenses (412,305) (1,294,068) (197,513)

Technology and content expenses (338,398) (337,516) (51,515)

General and administrative expenses (839,220) (956,688) (146,019)

Total operating expenses (2,983,613) (4,381,410) (668,733)

Other operating income 148,688 298,000 45,484

Income from operations 782,191 1,511,413 230,688

Investment gain and revaluation of investments 42,553 97,936 14,948

Impairment loss of investments (5,046) 0 0

Interest expense (35,395) (3,696) (564)

Interest income 81,190 153,424 23,417

Foreign exchange gain 48,754 30,950 4,724

Income before income tax expense and share of gain of equity method investees 914,247 1,790,027 273,213

Income tax expenses (172,716) (306,959) (46,851)

Share of (loss) gain of equity method investees (60,639) 64,642 9,866

Net income 680,892 1,547,710 236,228

Net loss(income) attributable to non-controlling interests 3,933 (2,240) (342)

Net income attributable to Vipshop's shareholders 684,825 1,545,470 235,886

Shares used in calculating earnings per share (3):

Weighted average number of Class A and Class B ordinary shares:

-Basic 134,326,928 136,459,216 136,459,216

-Diluted 136,909,242 141,842,600 141,842,600

Net earnings per Class A and Class B ordinary share

Net income attributable to Vipshop's shareholders--Basic 5.10 11.33 1.73

Net income attributable to Vipshop's shareholders--Diluted 5.00 10.90 1.66

Net earnings per ADS (1 ordinary share equals to 5 ADSs)

Net income attributable to Vipshop's shareholders--Basic 1.02 2.27 0.35

Net income attributable to Vipshop's shareholders--Diluted 1.00 2.18 0.33

(1) Other revenues primarily consist of revenues from third-party logisticsservices, product promotion and online advertising, fees charged to third-partymerchants which the Company provides platform access for sales of theirproducts, interest income from microcredit and consumer financing services,inventory and warehouse management services to certain suppliers, loanfacilitation service income, and lease income earned from the Shan ShanOutlets.

(2) Fulfillment expenses include shipping and handling expenses, which amountedRMB 0.8 billion and RMB 1.2 billion in the three month periods endedMarch 31,2020 and March 31,2021, respectively.

(3) Authorized share capital is re-classified and re-designated into Class Aordinary shares and Class B ordinary shares, with each Class A ordinary sharebeing entitled to one vote and each Class B ordinary share being entitled toten votes on all matters that are subject to shareholder vote.

Three Months Ended

March 31,2020 March 31,2021 March 31,2021

RMB'000 RMB'000 USD'000

Share-based compensation expenses are included in the operating expenses asfollows:

Fulfillment expenses 27,215 19,750 3,014

Marketing expenses 3,939 4,289 655

Technology and content expenses 44,402 52,581 8,025

General and administrative expenses 171,455 143,517 21,905

Total 247,011 220,137 33,599

Vipshop Holdings Limited

Unaudited Condensed Consolidated Balance Sheets

(In thousands, except for share and per share data)

December 31,2020 March 31,2021 March 31,2021

RMB'000 RMB'000 USD'000

ASSETS

CURRENT ASSETS

Cash and cash equivalents 11,995,415 14,435,039 2,203,217

Restricted cash 815,906 652,129 99,534

Short term investments 7,328,719 3,722,773 568,206

Accounts receivable, net 334,529 404,021 61,666

Amounts due from related parties 333,539 377,222 57,575

Other receivables and prepayments,net 2,286,359 2,148,554 327,933

Loan receivables,net 27,258 13,773 2,102

Inventories 7,642,509 5,818,758 888,116

Assets held for sale 408,748 19,528 2,981

Total current assets 31,172,982 27,591,797 4,211,330

NON-CURRENT ASSETS

Property and equipment, net 13,584,459 13,567,591 2,070,819

Deposits for property and equipment 73,718 78,468 11,977

Land use rights, net 6,062,792 5,961,466 909,897

Intangible assets, net 333,022 326,910 49,896

Investment in equity method investees 1,949,787 1,974,677 301,395

Other investments 2,861,034 3,024,524 461,633

Other long-term assets 100,328 303,923 46,388

Goodwill 593,662 593,662 90,611

Deferred tax assets, net 628,267 660,529 100,816

Operating lease right-of-use assets 1,580,763 1,463,294 223,342

Total non-current assets 27,767,832 27,955,044 4,266,774

TOTAL ASSETS 58,940,814 55,546,841 8,478,104

LIABILTIES AND EQUITY

CURRENT LIABILITIES

Short term loans 1,043,426 122,438 18,688

Accounts payable 15,191,313 10,788,863 1,646,702

Advance from customers 1,558,891 1,473,117 224,842

Accrued expenses and other current liabilities 7,696,996 7,489,426 1,143,110

Amounts due to related parties 444,100 512,360 78,201

Deferred income 334,431 324,951 49,597

Operating lease liabilities 299,791 301,109 45,958

Total current liabilities 26,568,948 21,012,264 3,207,098

NON-CURRENT LIABILITIES

Deferred tax liability 432,995 435,485 66,468

Deferred income-non current 1,070,891 1,055,681 161,128

Operating lease liabilities 1,360,946 1,250,183 190,815

Other long term liabilities 121,245 147,622 22,531

Total non-current liabilities 2,986,077 2,888,971 440,942

TOTAL LIABILITIES 29,555,025 23,901,235 3,648,040

EQUITY:

Class A ordinary shares (US$0.0001 par value, 483,489,642 shares authorized,and 119,223,484and 121,962,190 shares issued and outstanding as of December 31, 2020 and March 77 79 1231,2021,respectively)

Class B ordinary shares (US$0.0001 par value, 16,510,358 shares authorized, and16,510,358and 15,560,358 shares issued and outstanding as of December 31, 2020 and March 11 11 231,2021,respectively)

Additional paid-in capital 10,816,185 11,453,486 1,748,143

Retained earnings 17,740,415 19,285,885 2,943,601

Accumulated other comprehensive loss (58,954) (53,783) (8,208)

Non-controlling interests 888,055 959,928 146,514

Total shareholders' equity 29,385,789 31,645,606 4,830,064

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 58,940,814 55,546,841 8,478,104

Vipshop Holdings Limited

Reconciliations of GAAP and Non-GAAP Results

Three Months Ended

March March March 31,2020 31,2021 31,2021

RMB'000 RMB'000 USD'000

Income from operations 782,191 1,511,413 230,688

Share-based compensation expenses 247,011 220,137 33,599

Amortization of intangible assets resulting 17,689 5,896 900from business acquisitions

Non-GAAP income from operations 1,046,891 1,737,446 265,187

Net income attributable to Vipshop's 684,825 1,545,470 235,886shareholders

Share-based compensation expenses 247,011 220,137 33,599

Impairment loss of investments 5,046 0 0

Investment gain and revaluation of (9,895) (54,111) (8,259)investments excluding dividends

Share of loss(gain) in investment oflimited partnerships that are accounted for 56,327 (9,972) (1,522)as an equitymethod investee

Tax effect of investment gain andrevaluation of investments excluding (10,468) 6,747 1,030dividends

Amortization of intangible assets resulting 17,689 5,896 900from business acquisitions

Tax effect of amortization of intangibleassets resulting from business (4,422) (1,474) (225)acquisitions

Non-GAAP net income attributable to 986,113 1,712,693 261,409Vipshop's shareholders

Shares used in calculating earnings pershare:

Weighted average number of Class A andClass B ordinary shares:

-Basic 134,326,928 136,459,216 136,459,216

-Diluted 136,909,242 141,842,600 141,842,600

Non-GAAP net income per Class A and Class Bordinary share

Non-GAAP net income attributable to 7.34 12.55 1.92Vipshop's shareholders--Basic

Non-GAAP net income attributable to 7.20 12.07 1.84Vipshop's shareholders--Diluted

Non-GAAP net income per ADS (1 ordinaryshare equal to 5 ADSs)

Non-GAAP net income attributable to 1.47 2.51 0.38Vipshop's shareholders--Basic

Non-GAAP net income attributable to 1.44 2.41 0.37Vipshop's shareholders--Diluted

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SOURCE Vipshop Holdings Limited