GlobeNewswire Inc | Nov 29, 2021 07:34AM EST

November 29, 2021

BEIJING, Nov. 29, 2021 (GLOBE NEWSWIRE) -- Quhuo Limited (NASDAQ: QH) (Quhuo, the Company, we or our), a leading tech-enabled workforce operational solution platform in China, today announced its unaudited financial results for the third quarter ended September 30, 2021.

Financial and Operational Highlights for the Third Quarter of 2021

-- Total revenues were RMB1,105.5 million (US$171.6 million), representing a 43.7% year-over-year increase. -- Revenues from on-demand delivery solutions increased 38.0% year-over-year. -- Revenues from mobility service solutions, consisting of shared-bike maintenance, ride hailing and freight service solutions, increased 364.5% year-over-year.(1) -- Revenues from housekeeping and accommodation solutions increased 538.0% year-over-year. -- Adjusted EBITDA was RMB35.1 million (US$5.4 million), representing a 20.5% quarter-over-quarter increase. -- Adjusted net income was RMB28.2 million (US$4.4 million), representing a 183.5% quarter-over-quarter increase. -- The number of average monthly delivery orders was 53.1 million, representing a 59.1% year-over-year increase. -- We provided services in 1,231 business circles across 131 cities nationwide in the third quarter of 2021, compared with 1,067 business circles across 81 cities in the same period in 2020.

Mr. Leslie Yu, Chairman and Chief Executive Officer of Quhuo, commented, We are very pleased to report another solid quarter that generated total revenues of RMB1.1 billion, representing an increase of 43.7% year-over-year, which was in-line with our prior guidance. All of our three main business lineson-demand food deliveries, mobility service solutions and housekeeping solutionshave continuously manifested solid performance, which was primarily driven by strong market demand and our geographical expansion. Benefiting from our improved operations, we recorded market-leading top-line growth rate. Meanwhile, we made great effort to enhance our technology capability, as evidenced by our R&D expenses that doubled year-over-year. We believe such investment will enable us to expand our services into additional sectors over time, improve our operational efficiency and service quality, and enhance our competitive advantages.___________(1)We commenced our freight service solutions for industry customers in July 2021 by fulfilling end-to-end intra-city and long-distance transportation orders.

Unaudited Third Quarter 2021 Financial Results

Total revenues were RMB1,105.5 million (US$171.6 million), representing an increase of 43.7% year-over-year, primarily due to the rapid growth of our major business lines.

-- Revenues from on-demand delivery solutions were RMB1,047.0million (US$162.5 million), representing an increase of 38.0% from RMB758.8 million in the third quarter of 2020, primarily due to the increase in the number of delivery orders we fulfilled as a result of the industry growth and our continued penetration and expansion into new geographical markets. -- Revenues from mobility service solutions, consisting of shared-bike maintenance, ride hailing and freight service solutions, were RMB34.6 million (US$5.4 million), representing an increase of 364.5% from RMB7.4 million in the third quarter of 2020, primarily due to (1) our enlarged customer base and service scope for shared-bike maintenance solutions, and (2) the commencement of freight service solutions in July 2021. -- Revenues from housekeeping and accommodation solutions were RMB21.9 million (US$3.4 million), representing a significant increase of 538.0% from RMB3.4 million in the third quarter of 2020, primarily because we enlarged our customer base for housekeeping and accommodation solutions to include hotels and B&Bs following our acquisition of Lailai and Chengtu Home.

Cost of revenues was RMB1,055.1 million (US$163.8 million), representing an increase of 53.2% year-over-year, primarily due to (1) our business expansion, which resulted in increased costs proportionate to our revenue growth, and (2) the incremental hiring expenses and equipment costs to expand workforce on our platform and secure additional resources in preparation for the anticipated increased demand of our solutions and our continuous business expansion plan in the fourth quarter.

General and administrative expenses were RMB56.2 million (US$8.7 million), representing a decrease of 45.6% from RMB103.2 million in the third quarter of 2020. The decrease was primarily due to the decrease in share-based compensation expenses from RMB 72.0 million in the third quarter of 2020 to RMB 9.1 million (US$1.4 million) in the third quarter of 2021, primarily because we incurred substantial share-based compensation expenses in the third quarter of 2020 as we satisfied the performance conditions of our share incentive awards upon completion of our initial public offering then. Excluding share-based compensation expenses, general and administrative expenses increased by 51.0% year-over-year, primarily due to the increases in (1) staff cost in line with the rapid development of our housekeeping solutions, and (2) professional services fees and expenditures in connection with our business expansion plan.

Research and development expenses were RMB6.3 million (US$1.0 million), representing an increase of 108.9% from RMB3.0 million in the third quarter of 2020, primarily due to (1) the incurrence of outsourcing expenses to develop a new SaaS system for our housekeeping solutions, and (2) the increase in staff cost as we enlarged our research and development team.

Operating loss was RMB19.3 million (US$3.0 million), compared to operating loss of RMB24.0 million in the third quarter of 2020. Excluding share-based compensation expenses, the adjusted operating loss was RMB10.2 million, compared to adjusted operating profit of RMB48.0 million in the third quarter of 2020.

We recorded other income, net, of RMB39.2 million (US$6.1 million), compared to other income, net, of RMB32.1 million in the third quarter of 2020, primarily due to the increase in fair value change of investment in a mutual fund.

We recorded income tax benefit of RMB0.8 million (US$0.1 million), compared to income tax expense of RMB15.8 million in the third quarter of 2020, primarily due to the lower estimated annual effective tax rate for the third quarter of 2021.

Net income attributable to Quhuo Limited was RMB24.9 million (US$3.9 million), compared to net loss of RMB9.6 million in the third quarter of 2020.

Adjusted EBITDA was RMB35.1 million (US$5.4 million), compared to adjusted EBITDA of RMB85.1 million in the third quarter of 2020.(2)

Adjusted net income was RMB28.2 million (US$4.4 million), compared to adjusted net income of RMB61.3 million in the third quarter of 2020.(2)_____________(2) See Use of Non-GAAP Financial Measures.

Balance Sheet

As of September 30, 2021, the Company had cash, short-term investments and restricted cash of RMB257.1 million (US$39.9 million) and short-term debt of RMB140.6 million (US$21.8 million).

Financial outlook

For the fourth quarter of 2021, the Company expects total revenues to be in the range of RMB1,050 million to RMB1,150 million, representing an increase of 20.6% to 32.0% year-over-year.

The forecast reflects the Companys current and preliminary views on the market and its operational conditions, which is subject to change.

CONFERENCE CALL

Quhuo will hold a conference call on Monday, November 29, 2021 at 8:00 a.m. U.S. Eastern Time (9:00 p.m. Beijing/Hong Kong time on the same day) to discuss the financial results.

Participant can register for the conference call by navigating to http://apac.directeventreg.com/registration/event/3263767. Once preregistration has been completed, participants will receive dial-in numbers, a direct event passcode, and a unique registrant ID.

To join the conference, please dial the number you receive, enter the direct event passcode followed by your unique registrant ID, and you will be joined to the conference instantly.

A live and archived webcast of the conference call will also be available at the Companys investor relations website at https://ir.quhuo.cn/.

A replay will be accessible through 7:59 a.m. U.S. Eastern Time on December 6, 2021 (8:59 p.m. Beijing/Hong Kong time on the same day):

United States: +1-646-254-3697International: +61-2-8199-0299China Domestic: 400-6322-162Hong Kong: +852-3051-2780Conference ID: 3263767#

USE OF NON-GAAP FINANCIAL MEASURES

Quhuo has provided in this press release financial information that has not been prepared in accordance with generally accepted accounting principles in the United States (GAAP).

Quhuo uses adjusted net income (loss) and adjusted EBITDA, which are non-GAAP financial measures, in evaluating our operating results and for financial and operational decision-making purposes. Adjusted net income (loss) represents net income (loss) before share-based compensation expenses. Adjusted EBITDA represents adjusted net income (loss) before income tax benefit (expense), amortization, depreciation and interest. Quhuo believes that these non-GAAP financial measures help identify underlying trends in its business that could otherwise be distorted by the effect of share-based compensation expenses, income tax benefits or expenses, amortization, depreciation and interest. Quhuo believes that such non-GAAP financial measures also provide useful information about its operating results, enhance the overall understanding of its past performance and prospects and allow for greater visibility with respect to key metrics used by its management in its financial and operational decision-making.

The non-GAAP financial measures are not defined under U.S. GAAP and are not presented in accordance with U.S. GAAP. They should not be considered in isolation or construed as alternatives to net loss or any other measure of performance or as an indicator of Quhuos operating performance. Further, these non-GAAP financial measures may not be comparable to similarly titled measures presented by other companies. Other companies may calculate similarly titled measures differently, limiting their usefulness as comparative measures to the Companys data. Quhuo encourages investors and others to review the Companys financial information in its entirety and not rely on a single financial measure. Investors are encouraged to compare the historical non-GAAP financial measures with the most directly comparable GAAP measures. Quhuo mitigates these limitations by reconciling the non-GAAP financial measures to the most comparable U.S. GAAP performance measures, all of which should be considered when evaluating its performance. The following table sets forth a reconciliation of our net income (loss) to adjusted net income and adjusted EBITDA, respectively.

QUHUO LIMITED Reconciliation of GAAP and Non-GAAP Results For the Three Months Ended For the Nine Months Ended September September September September September September 30, 2020 30, 2021 30, 2021 30, 2020 30, 2021 30, 2021 (RMB) (RMB) (US$) (RMB) (RMB) (US$) Net (loss)/ (10,701 ) 19,066 2,960 (12,600 ) (100,491 ) (15,595 )incomeLess:Share-based (72,047 ) (9,136 ) (1,418 ) (74,627 ) (59,388 ) (9,217 )Compensation Adjusted netincome/ 61,346 28,202 4,378 62,027 (41,103 ) (6,378 )(loss) Less: Incometax (15,822 ) 805 125 (30,258 ) (3,049 ) (473 )(expense)/benefitDepreciation (1,809 ) (138 ) (21 ) (5,921 ) (3,956 ) (614 )Amortization (3,856 ) (5,745 ) (892 ) (9,889 ) (14,872 ) (2,308 )Interest (2,300 ) (1,803 ) (280 ) (6,963 ) (4,900 ) (760 )expense Adjusted 85,133 35,083 5,446 115,058 (14,326 ) (2,223 )EBITDA

EXCHANGE RATE INFORMATION

This press release contains translations of certain RMB amounts into U.S. dollars at a specified rate solely for the convenience of the reader. Unless otherwise noted, all translations from RMB to U.S. dollars are made at a rate of RMB 6.4434 to US$1.00, the rate in effect as of September 30, 2021 as set forth in the H.10 statistical release of the Federal Reserve Board. The Company makes no representation that the RMB or US$ amounts referred could be converted into US$ or RMB, as the case may be, at any particular rate or at all.

SAFE HARBOR STATEMENT

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended and the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical or current fact included in this press release are forward-looking statements, including but not limited to statements regarding Quhuos business development, financial outlook, beliefs and expectations. Forward-looking statements include statements containing words such as expect, anticipate, believe, project, will and similar expressions intended to identify forward-looking statements. These forward-looking statements are based on Quhuos current expectations and involve risks and uncertainties. Quhuos actual results and the timing of events could differ materially from those anticipated in such forward-looking statements as a result of these risks and uncertainties, which include, without limitation, risks and uncertainties related to Quhuos abilities to (1) manage its growth and expand its operations, (2) address any or all of the risks and challenges in the future in light of its limited operating history and evolving business portfolios, (3) remain its competitive position in the on-demand food delivery market or further diversify its solution offerings and customer portfolio, (4) maintain relationships with major customers and to find replacement customers on commercially desirable terms or in a timely manner or at all, (5) maintain relationship with existing industry customers or attract new customers, (6) attract, retain and manage workers on its platform, and (7) maintain its market shares to competitors in existing markets and its success in expansion into new markets, as well as the length and severity of the recent COVID-19 outbreak and its impact on Quhuos business and industry. Other risks and uncertainties are included under the caption Risk Factors and elsewhere in the Companys filings with the Securities and Exchange Commission, including, without limitation, the final prospectus related to the IPO filed with the SEC on July 10, 2020 and the Companys latest annual report on Form 20-F. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. All forward-looking statements are qualified in their entirety by this cautionary statement, and Quhuo undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date hereof.

ABOUT QUHUO LIMITED

Quhuo Limited (NASDAQ: QH) is a leading workforce operational solution platform in China. Quhuo provides tech-enabled, end-to-end operational solutions to blue-chip on-demand consumer service businesses in industries with significant e-commerce exposure, primarily including on-demand delivery, mobility services, housekeeping and accommodation. Quhuos platform helps its industry customers mobilize a large team of workers and utilizes a combination of training, performance monitoring and refinement, and incentives to transform them into skilled workers who can follow industry-specific, standardized and highly efficient service procedures. Within the on-demand consumer service ecosystem, the Company plays a unique and indispensable role as the link between consumer service businesses and the end consumers to enable the delivery of goods, services and experiences to consumers.

For more information about Quhuo, please visit https://ir.quhuo.cn/.

CONTACTS:

Investor RelationsQuhuo LimitedAnnia SunE-mail: ir@meishisong.cn

ChristensenIn ChinaMr. Eric YuanPhone: +86-13801110739E-mail: Eyuan@christensenir.com

In USMs. Linda BergkampPhone: +1-480-614-3004E-mail: lbergkamp@christensenir.com

QUHUO LIMITED UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Amounts in thousands of Renminbi (?RMB?) and U.S. dollars (?US$?), except fornumber of shares and per share data) AsofDecember As As 31, 2020 ofSeptember ofSeptember 30,2021 30,2021 (RMB) (RMB) (US$)Assets Current assets Cash 97,807 57,187 8,875Restricted cash 5,948 2,314 359Short-term investments 201,578 197,594 30,666Accounts receivable, net 381,248 468,159 72,657Prepayments and other current 45,462 70,549 10,949assetsAmounts due from related 2,940 - -partiesTotal current assets 734,983 795,803 123,506 Property and equipment, net 23,390 16,144 2,506Intangible assets, net 111,990 129,382 20,080Long-term investments 1,065 6,105 947Right-of-use assets, net 32,534 8,302 1,288Goodwill 118,724 118,724 18,426Deferred tax assets 2,370 14,548 2,258Other non-current assets 105,501 142,168 22,064Total non-current assets 395,574 435,373 67,569 Total assets 1,130,557 1,231,176 191,075 Liabilities, non-controllinginterests and shareholders? equityCurrent liabilities Accounts payables 268,939 303,965 47,175Short-term lease liabilities 17,707 5,339 829Accrued expenses and other 105,744 149,176 23,150current liabilitiesShort-term debt 73,837 140,574 21,817Amounts due to related parties - 18,887 2,931Total current liabilities 466,227 617,941 95,902 Deferred tax liabilities 727 - -Long-term debt 5,135 420 65Long-term lease liabilities 14,623 1,695 263Other non-current liabilities 41,014 48,996 7,604Total non-current liabilities 61,499 51,111 7,932 Total liabilities 527,726 669,052 103,834

QUHUO LIMITED UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS AsofDecember As As ofSeptember 31, 2020 ofSeptember 30,2021 30,2021 (RMB) (RMB) (US$) Shareholders? equity Ordinary shares 36 36 6 Additional paid-in 1,779,923 1,842,521 285,955 capitalAccumulated deficit (1,208,827 ) (1,295,382 ) (201,040 )Accumulated other (14,843 ) (16,931 ) (2,628 )comprehensive incomeTotalQuhuoLimited 556,289 530,244 82,293 shareholders? equityNon-controlling interests 46,542 31,880 4,948 Total shareholders? 602,831 562,124 87,241 equity Total liabilities and 1,130,557 1,231,176 191,075 shareholders? equity

QUHUO LIMITED UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Amounts in thousands of Renminbi (?RMB?) and U.S. dollars (?US$?), except for number of shares and per share data) For the Three Months Ended For the Nine Months Ended September September September 30, September September September 30, 2020 30, 2021 2021 30, 2020 30, 2021 30, 2021 (RMB) (RMB) (US$) (RMB) (RMB) (US$) Revenues 769,544 1,105,485 171,569 1,709,739 2,943,811 456,872 Cost of (688,638 ) (1,055,133 ) (163,754 ) (1,557,338 ) (2,843,907 ) (441,367 )revenuesGeneral and (103,201 ) (56,182 ) (8,719 ) (160,215 ) (185,085 ) (28,725 )administrativeResearch and (3,029 ) (6,328 ) (982 ) (8,346 ) (15,509 ) (2,407 )developmentGain/(loss) ondisposal of 1,308 (7,134 ) (1,107 ) 2,600 (4,162 ) (646 )assets, net Operating loss (24,016 ) (19,292 ) (2,993 ) (13,560 ) (104,852 ) (16,273 ) Interest income 110 152 24 625 529 82 Interest (2,300 ) (1,803 ) (280 ) (6,963 ) (4,900 ) (760 )expenseOther income, 32,128 39,204 6,084 39,058 11,829 1,836 netForeign (801 ) - - (1,502 ) (48 ) (7 )exchange lossIncome/(Loss)before income 5,121 18,261 2,835 17,658 (97,442 ) (15,122 )taxIncome tax(expense)/ (15,822 ) 805 125 (30,258 ) (3,049 ) (473 )benefitNet (loss)/ (10,701 ) 19,066 2,960 (12,600 ) (100,491 ) (15,595 )income Net lossattributable to 1,096 5,856 909 4,052 13,936 2,163 non-controllinginterestsNet (loss)/incomeattributable toordinary (9,605 ) 24,922 3,869 (8,548 ) (86,555 ) (13,432 )shareholders ofthe Quhuolimited Non-GAAP Financial DataAdjusted net 61,346 28,202 4,378 62,027 (41,103 ) (6,378 )income/(loss)Adjusted EBITDA 85,133 35,083 5,446 115,058 (14,326 ) (2,223 ) (Loss)/earnings per shareBasic (0.24 ) 0.56 0.09 (0.37 ) (1.98 ) (0.31 )Diluted (0.24 ) 0.50 0.08 (0.37 ) (1.98 ) (0.31 )Net(Loss)/incomeused in basic anddiluted (loss)/ (9,605 ) 24,922 3,869 (8,548 ) (86,555 ) (13,432 )earning per sharecalculation Weighted average number of ordinaryshares used in (loss)/earning per share computation:Basic 40,130,720 44,184,514 44,184,514 23,358,747 43,709,910 43,709,910 Diluted 40,130,720 49,591,928 49,591,928 23,358,747 43,709,910 43,709,910