PR Newswire | Aug 20, 2021 06:00AM EDT

08/20 05:00 CDT

Boqii Announces Fiscal 2022 First Quarter Unaudited Financial ResultsFirst Quarter Revenues of RMB321.8 million, up 35.0% year-over-yearFirst Quarter GMV of RMB792.1 million, up 42.9% year-over-year SHANGHAI, Aug. 20, 2021

SHANGHAI, Aug. 20, 2021 /PRNewswire/ -- Boqii Holding Limited ("Boqii" or the "Company") (NYSE: BQ), a leading pet-focused platform in China, today announced its unaudited financial results for the first quarter of fiscal year 2022 (the quarter ended June 30, 2021).

Fiscal Q1 2022 Operational and Financial Highlights

* Total revenues were RMB321.8 million (US$49.8 million), an increase of 35.0% from RMB238.4 million in the same quarter of fiscal year 2021. * Net loss was RMB37.4 million (US$5.8 million), compared to net loss of RMB42.3 million in the same quarter of fiscal year 2021. * Adjusted net loss was RMB31.5 million (US$4.9 million), compared to adjusted net loss of RMB44.4 million in the same quarter of fiscal year 2021. * EBITDA[1] was a loss of RMB35.6 million (US$5.5 million), compared to a loss of RMB35.4 million in the same quarter of fiscal year 2021. * Total GMV[2] was RMB792.1 million (US$122.7 million), an increase of 42.9% from RMB554.5 million in the same quarter of fiscal year 2021. * Active buyers were 1.6 million, an increase of 27.9% from 1.3 million in the same quarter of fiscal year 2021.

^[1] EBITDA refers to net loss excluding income tax expenses, interest expense,interest income, depreciation and amortization expenses, but including all theprofessional expenses in relation to initial public offering in the fiscal yearof 2021. EBITDA is a Non-GAAP financial measurement. Please refer to "Non-GAAPfinancial measurement".

^[2] GMV refers to gross merchandise volume, which is the total value ofconfirmed orders placed with us and sold through distribution model or dropshipping model where we act as a principal in the transaction regardless ofwhether the products are delivered or returned, calculated based on the listedprices of the ordered products without taking into consideration any discounts.The total GMV amount (i) includes GMV of products sold by Xingmu, (ii) excludesproducts sold through consignment model and (iii) excludes the value ofservices offered by us. GMV is subject to future adjustments (such as refunds)and represents only one measure of the Company's performance and should not berelied on as an indicator of our financial results, which depend on a varietyof factors.

CEO & CFO Quote

Mr. Hao Liang, Boqii's Founder, Chairman and Chief Executive Officer commented, "We delivered another strong quarter of solid financial and operational results. Our relentless focus to expand and optimize our portfolio offerings powered solid topline growth and user engagement. GMV continued to see strong growth, with 42.9% year over year increase to RMB792.1 million. Total active buyers increased by 27.9% to 1.6 million, with 11.7% year-over-year growth in average spending per user. We are excited to see this continuous momentum of user development and remain committed to bringing in more buyers and retaining existing ones while growing their average spending over time."

Ms. Yingzhi (Lisa) Tang, Boqii's Co-Founder, Co-CEO and CFO commented: "Our strong user growth continued to fuel topline expansion. In this quarter, total revenues grew 35.0% year over year to RMB321.8 million, with an exceptional revenue growth of nearly 20 times year over year from online marketing and information services and other revenue. Meanwhile, in addition to our topline growth, this quarter, our adjusted net loss narrowed down to RMB31.5 million, compared to adjusted net loss of RMB44.4 million in the same period last year, showing improving operational efficiency. Looking ahead, we are committed to execute on our growth strategies with a focus on quality and improved monetization capability, which we believe will bring long-term value to both our users and shareholders."

Fiscal Q1 2022 Financial Results

Total revenues were RMB321.8 million (US$49.8 million), representing an increase of 35.0% from RMB238.4 million in the same quarter of fiscal year 2021. The increase was primarily due to the continued organic growth of our business.

Three Months Ended June 30% Revenues (in million) 2021 2020 change RMB RMB YoY

Product sales 311.5 237.9 30.9

? Boqii Mall 108.3 89.8 20.5

? Third party e-commerce platforms 203.2 148.1 37.2

Online marketing and information services and other revenue10.3 0.5 1,944.2

Total 321.8 238.4 35.0

Gross profitwas RMB56.4 million (US$8.7 million), an increase of 30.3% from RMB43.3 million in the same quarter of fiscal year 2021.

Gross margin was 17.5%, compared with 18.1% in the same quarter of fiscal year 2021. The decrease was mainly due to the increased e-commerce promotions during the 618 Shopping Festival resulting in lower price points.

Operating expenseswere RMB97.9 million, an increase of 14.6% from RMB85.4 million in the same quarter of fiscal year 2021. Operating expenses as a percentage of total revenues was 30.4%, down from 35.8% in the same quarter of fiscal year 2021.

* Fulfillment Expenses were RMB32.9 million, a decrease of 2.2% from RMB33.6 million in the same quarter of fiscal year 2021. Fulfillment expenses as a percentage of total revenues were 10.2%, down from 14.1% in the same quarter of fiscal year 2021. The decrease was mainly due to: (i) the improved utilization of warehouses by adjusting inventory mix; (ii) more cost-efficient China warehouse relocations; and (iii) lower delivery service prices through renegotiation with third-party delivery service providers. * Sales and marketing expenses were RMB45.5 million, an increase of 30.2% from RMB34.9 million in the same quarter of fiscal year 2021. The increase was primarily due to: (i) the increased personnel expense of RMB3.2 million and increased advertising fee of RMB4.1 million which was in line with our revenue growth, and (ii) the increased share-based compensation expense of RMB1.3 million. Sales and marketing expenses as a percentage of total revenue were 14.1%, down from 14.7% in the same quarter of fiscal year 2021. * General and administrative expenses were RMB19.6 million, an increase of 16.0% from RMB16.9 million in the same quarter of fiscal year 2021. The increase was primarily due to the increased share-based compensation expense of RMB4.7 million, partially offset by the reduced professional expense of RMB2.2 million with the Company's initial public offering in the same quarter of fiscal year 2021. General and administrative expenses as a percentage of total revenue were 6.1%, down from 7.1% in the same quarter of fiscal year 2021.

Operating losswas RMB41.5 million (US$6.4 million), compared to RMB42.1 million in the same quarter of fiscal year 2021.

EBITDAwas a loss of RMB35.6 million (US$5.5 million), compared to a loss of RMB35.4 million in the same quarter of fiscal year 2021.

Net losswas RMB37.4 million (US$5.8 million), compared to net loss of RMB42.3 million in the same quarter of fiscal year 2021.

Adjustednet loss was RMB31.5 million (US$4.9 million), compared to adjusted net loss of RMB44.4 million in the same quarter of fiscal year 2021.

Diluted net loss per sharewas RMB0.52(US$0.08), compared to diluted net loss per share of RMB4.06 in the same quarter of fiscal year 2021.

Total cash and cash equivalents and short-term investments were RMB415.7 million (US$64.4 million), compared to RMB460.8 million as of March 31, 2021.

Conference Call

Boqii's management will hold a conference call to discuss the financial results at 8:00 AM on Friday, August 20, 2021, U.S. Eastern Time (8:00 PM on Friday, August 20, 2021, Beijing/Hong Kong Time).

To join the conference, please dial in 15 minutes before the conference is scheduled to begin using below numbers.

Phone Number

International 1-412-317-6061

United States 1-888-317-6003

Hong Kong 852 800 963-976

Mainland China86 4001-206115

Passcode 7711990

A replay of the conference call may be accessed by phone at the following numbers until August 27, 2021.

Phone Number

International 1-412-317-0088

United States 1-877-344-7529

Replay Access Code10159611

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

About Boqii Holding Limited

Boqii Holding Limited (NYSE: BQ) is a leading pet-focused platform in China. We are the leading online destination for pet products and supplies in China with our broad selection of high-quality products including global leading brands, local emerging brands, and our own private label, Yoken and Mocare, offered at competitive prices. Our online sales platforms, including Boqii Mall and our flagship stores on third-party e-commerce platforms, provide customers with convenient access to a wide selection of high-quality pet products and an engaging and personalized shopping experience. Our Boqii Community provides an informative and interactive content platform for users to share their knowledge and love for pets.

Safe Harbor Statement

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. Statements that are not historical facts, including statements about the Company's beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties, and a number of factors could cause actual results to differ materially from those contained in any forward-looking statement. In some cases, forward-looking statements can be identified by words or phrases such as "may," "will," "expect," "anticipate," "target," "aim," "estimate," "intend," "plan," "believe," "potential," "continue," "is/are likely to" or other similar expressions. The Company may also make written or oral forward-looking statements in its reports filed with, or furnished to, the U.S. Securities and Exchange Commission, in its annual reports 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 the Company's beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. Further information regarding such risks, uncertainties or factors is included in the Company's filings with the SEC. All information provided in this press release is as of the date of this press release, and the Company does not undertake any duty to update such information, except as required under applicable law.

Non-GAAPFinancial Measures

The Company uses non-GAAP financial measures, namely adjusted net loss, adjusted net loss margin, EBITDA and EBITDA margin, in evaluating its operating results and for financial and operational decision-making purposes. The Company defines (i) adjusted net loss as net loss excluding fair value change of derivative liabilities and share-based compensation expenses, (ii) adjusted net loss margin as adjusted net loss as a percentage of total revenues, (iii) EBITDA as net loss excluding income tax expenses, interest expense, interest income, depreciation and amortization expenses, (iv) EBITDA margin as EBITDA as a percentage of total revenues. The Company believes adjusted net loss, adjusted net loss margin, EBITDA and EBITDA margin enhance investors' overall understanding of its financial performance and allow for greater visibility with respect to key metrics used by its management in its financial and operational decision-making.

These non-GAAP financial measures are not defined under U.S. GAAP and are not presented in accordance with U.S. GAAP. As these non-GAAP financial measures have limitations as analytical tools and may not be calculated in the same manner by all companies, they may not be comparable to other similarly titled measures used by other companies. The Company compensates for these limitations by reconciling the non-GAAP financial measures to the nearest U.S. GAAP performance measures, which should be considered when evaluating the Company's performance. For reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures, please see the section of the accompanying tables titled, "Reconciliation of GAAP and Non-GAAP Results." The Company encourages investors and others to review its financial information in its entirety and not rely on any single financial measure.

Exchange Rate

This press release contains translations of certain RMB amounts into U.S. dollars ("USD") at specified rates solely for the convenience of the reader. Unless otherwise stated, all translations from RMB to USD were made at the rate of RMB6.4566 to US$1.00, the noon buying rate in effect on June 30, 2021 in the H.10 statistical release of the Federal Reserve Board. The Company makes no representation that the RMB or USD amounts referred to could be converted into USD or RMB, as the case may be, at any particular rate or at all.

For investor and media inquiries, please contact:

In China:

Boqii Holding LimitedInvestor RelationsTel: +86-21-6882-6051Email: ir@boqii.com

The Blueshirt GroupMs. Susie WangEmail: susie@blueshirtgroup.com

In the United States:

The Blueshirt GroupMs. Julia QianEmail: julia@blueshirtgroup.com

BOQII HOLDING LIMITED

UNAUDITED INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS

(All amounts in thousands, except for share and per share data, unlessotherwise noted)

As of As of As of

March 31, June 30, June 30,

2021 2021 2021

RMB RMB US$

ASSETS

Current assets:

Cash and cash equivalents 292,237 287,060 44,460

Short-term investments 168,546 128,678 19,930

Accounts receivable, net 45,732 74,277 11,504

Inventories, net 91,551 105,809 16,388

Prepayments and other current assets 85,261 74,613 11,556

Amounts due from related parties 11,465 34,294 5,311

Total current assets 694,792 704,731 109,149

Non-current assets:

Property and equipment, net 8,386 8,338 1,291

Intangible assets 29,537 28,540 4,420

Operating lease right-of-use assets 29,234 32,805 5,081

Long-term investments 74,330 79,232 12,271

Goodwill 40,184 40,684 6,301

Other non-current asset 4,111 4,024 624

Total non-current assets 185,782 193,623 29,988

Total assets 880,574 898,354 139,137

LIABILITIES, MEZZANINE EQUITY AND SHAREHOLDERS' DEFICIT

Current liabilities

Short-term borrowings 85,566 103,332 16,004

Accounts payable 71,848 114,384 17,716

Salary and welfare payable 6,309 4,860 753

Accrued liabilities and other current liabilities 30,055 30,096 4,661

Amounts due to related parties, current 910 10,178 1,577

Contract liabilities 3,866 3,474 538

Operating lease liabilities, current 8,063 9,639 1,493

Derivative liabilities 9,996 10,125 1,568

Total current liabilities 216,613 286,088 44,310

Non-current liabilities

Deferred tax liabilities 8,958 8,711 1,349

Operating lease liabilities, non-current 19,997 21,891 3,390

Long-term borrowings 68,075 49,674 7,693

Other debts, non-current 433,292 365,256 56,571

Total non-current liabilities 530,322 445,532 69,003

Total liabilities 746,935 731,620 113,313

Mezzanine equity

Redeemable non-controlling interests 5,946 6,086 943

Total mezzanine equity 5,946 6,086 943

Stockholders' equity:

Class A ordinary shares (US$0.001 par value; 129,500,000 shares authorized, 54,505,108 and 54,556,503 shares issued and outstanding as of March 31 364 365 56 and June 30, 2021, respectively)

Class B ordinary shares (US$0.001 par value; 15,000,000 shares authorized, 13,037,729 shares issued and outstanding as of March 31 and June 30, 82 82 13 2021, respectively)

Additional paid-in capital 3,272,612 3,279,409 507,916

Statutory reserves 3,047 3,117 483

Accumulated other comprehensive loss (20,172) (28,884) (4,474)

Accumulated deficit (2,759,882) (2,794,987) (432,888)

Receivable for issuance of ordinary shares (413,377) (343,068) (53,135)

Total Boqii Holding Limited shareholders' equity 82,674 116,034 17,971

Non-controlling interests 45,019 44,614 6,910

Total shareholders' equity 127,693 160,648 24,881

Total liabilities, mezzanine equity and shareholders' equity 880,574 898,354 139,137

Notes for all the condensed consolidated financial schedules presented:

Note 1: The conversion of Renminbi (RMB) into U.S. dollars (USD) is based onthe certified exchange rate of USD1.00=RMB6.4566on June 30, 2021 published by the Federal Reserve Board.

BOQII HOLDING LIMITED

UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(All amounts in thousands, except for share and per share data, unlessotherwise noted)

Three Months Ended June 30,

2020 2021 2021

RMB RMB US$

Net revenues:

Product sales 237,932 311,493 48,244

Online marketing and information services and other revenue 506 10,353 1,604

Total revenues 238,438 321,846 49,848

Total cost of revenue (195,168) (265,465) (41,115)

Gross profit 43,270 56,381 8,733

Operating expenses:

Fulfillment expenses (33,632) (32,887) (5,094)

Sales and marketing expenses (34,944) (45,485) (7,045)

General and administrative expenses (16,868) (19,571) (3,031)

Other income, net 47 12 2

Loss from operations (42,127) (41,550) (6,435)

Interest income 1,716 5,187 803

Interest expense (7,143) (6,062) (939)

Other gain, net 2,897 3,128 484

Fair value change of derivative liabilities 2,106 162 25

Loss before income tax expenses (42,551) (39,135) (6,062)

Income taxes expenses 309 1,009 156

Share of results of equity investees (57) 766 119

Net loss (42,299) (37,360) (5,787)

Less: Net income/(loss) attributable to the non-controlling 279 (2,467) (382) interest shareholders

Net loss attributable to Boqii Holding Limited (42,578) (34,893) (5,405)

Less: Accretion on convertible redeemable preferred shares to (35,137) - - redemption value

Less: Accretion on redeemable non-controlling interests to - (140) (22) redemption value

Less: Deemed dividend to preferred shareholders (12,547) - -

Net loss attributable to Boqii Holding Limited's ordinary (90,262) (35,033) (5,427) shareholders

Net loss (42,299) (37,360) (5,787)

Other comprehensive loss:

Foreign currency translation adjustment, net of nil tax (801) (8,712) (1,349)

Unrealized securities holding gains 1,195 - -

Total comprehensive loss (41,905) (46,072) (7,136)

Less: Total comprehensive income/(loss) attributable to non- 279 (2,467) (382) controlling interests shareholders

Total comprehensive loss attributable to Boqii Holding (42,184) (43,605) (6,754) Limited

Net loss per share attributable to Boqii Holding Limited's ordinary shareholders

- basic (4.06) (0.52) (0.08)

- diluted (4.06) (0.52) (0.08)

Weighted average number of ordinary shares

- basic 22,238,454 67,640,952 67,640,952

- diluted 22,238,454 67,640,952 67,640,952

Notes for all the condensed consolidated financial schedules presented:

Note 1: The conversion of Renminbi (RMB) into U.S. dollars (USD) is based onthe certified exchange rate ofUSD1.00=RMB6.4566 on June 30, 2021 published by the Federal Reserve Board.

Boqii Holding Limited

Reconciliation of GAAP and Non-GAAP Results

(In thousands)

Three Months Ended June 30,

2020 2021

RMB RMB

Net loss (42,299) (37,360)

Fair value change of derivative liabilities (2,106) (162)

Share-based compensation - 5,986

Adjusted Net Loss (44,405) (31,536)

Adjusted Net Loss Margin (18.6%) (9.8%)

Three Months Ended June 30,

2020 2021

RMB RMB

Net loss (42,299) (37,360)

Income tax expenses (309) (1,009)

Interest expenses 7,143 6,062

Interest income (1,716) (5,187)

Depreciation and amortization 1,750 1,928

EBITDA (35,431) (35,566)

EBITDA Margin (14.9%) (11.1%)

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SOURCE Boqii Holding Limited