Loss of 1.4 billion in three years, continue to lose in the first quarter! Love recycling is anxious to go on the market to “enrich blood”
China Times (www.chinatimes.net.cn) reporter Lu Xiao reports from Beijing
The new life (Love Recycling) who is engaged in the second-hand electronics business rang his own bell to go to the United States.
On the evening of June 18, Wanwu Xinsheng announced that it would first publicly issue approximately 16.23 million ADS shares and begin trading on the New York Stock Exchange on June 18, U.S. stock time. The price of ADS is 14 US dollars per share, and the total issuance scale is approximately 227 million US dollars.
Love Recycling was established in 2011. At the end of May this year, the renamed Wanwu Xinsheng Group submitted a prospectus for the US.
According to the prospectus, as of March 31, 2021, the overall revenue of Wanwu Xinsheng Group in the past 12 months was 5.68 billion yuan, a year-on-year increase of 49.4%. In 2020, its overall revenue was 4.858 billion yuan, a year-on-year increase of 23.5% compared to 2019.
However, despite the increase in income, the new life, which was founded ten years ago, is still at a loss.
The prospectus shows that from 2018 to 2020, the net losses of New Life will be 208 million yuan, 705 million yuan, and 471 million yuan, totaling about 1.4 billion yuan. In the first quarter of this year, Wanwuxinsheng’s loss was close to 95 million yuan.
According to a reporter from China Times, the main business lines of New Life include the C2B mode of Aihui, B2B mode of shooting, C2B mode of shooting and overseas-oriented AHS Device four major businesses.
“China Times” reporters previously learned from Wanwu Xinsheng that among its 70,000 orders a day, the most profitable is the B2C business that trades more than 10,000 units a day. According to the reporter’s understanding, Wanwu Xinsheng’s B2C business came from the merger with Jingdong’s second-hand trading platform “Pai Pai” in June 2019.
However, compared to the more profitable C-end market, the revenue of All New Life mainly depends on the B-end market. The prospectus shows that Wanwuxin’s revenue is divided into self-operated product revenue and platform revenue. Among them, the revenue of self-operated goods in 2020 is 4.24 billion yuan, accounting for 87% of the total income of the new life. Among them, 88% of merchandise sales are sold to second-hand merchants on the B-end through Paijitang. In addition, the revenue of the B2B platform also reached 280 million yuan in service revenue.
Wanwu Xinsheng’s public financing record before the IPO stayed in the F round. Before the IPO, JD.com held a 34.7% stake in Wanwu Xinsheng, making it its largest shareholder. Its founder Chen Xuefeng holds 10.9% of the shares. When it completed the E+ round of financing of more than 100 million U.S. dollars led by JD.com in September last year, Chen Xuefeng once told reporters such as China Times, “The valuation of Aihuishou must be properly based on 40, 50 IPOs will be considered only on the volume of 100 million U.S. dollars.” However, based on a rough calculation of the price of 14 U.S. dollars, the market value of New Life is less than 4 billion U.S. dollars.
Behind the “anxious” listing of Wanwu Xinsheng, its own hematopoietic ability still needs to be improved. In 2019, 2020 and the first quarter of 2021, its operating cash flow was -62716,600 U.S. dollars, -63,016,600 U.S. dollars and -46,174,400 U.S. dollars. As of March 1, 2021, the cash and cash equivalents on its accounts were only 100 million U.S. dollars.
What needs to be mentioned is that Wanwu Xinsheng stated in the prospectus that the net proceeds from the IPO will be mainly used to further improve technical capabilities, provide more diversified platform services, expand the network of Aihuishou stores, and develop new platforms for the auction platform. Sales channels and used for working capital and general corporate purposes.
As of March 31, 2021, Wanwusheng operates 755 offline stores in 172 cities in China. Among them, 753 are love recycling shops and 2 are photo shops. At the same time, AHS Device, the overseas business brand of Wanwu Xinsheng, also covers Hong Kong, the United States, Japan, India and other regions