ChinaCache International Holdings Ltd. Announces Fourth Quarter and Full Fiscal Year 2013 Financial Results

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| Source: ChinaCache International Holdings Ltd.

Record 2013 net revenues increased 35.6% to RMB1.1 billion

Full-year gross profit increased 36.3% to RMB346.6 million

4Q 2013 net revenues increased 50.8% year-over-year.

BEIJING, March 12, 2014 (GLOBE NEWSWIRE) -- ChinaCache International Holdings Ltd. ("ChinaCache" or the "Company") (NASDAQ: CCIH), the leading total solutions provider of Internet content and application delivery services in China, today announced its unaudited condensed consolidated financial results for the fourth quarter and full fiscal year ended December 31, 2013.

Highlights for the Fourth Quarter of 2013

  • Net revenues in the fourth quarter jumped to RMB339.4 million (US$56.1 million), and exceeded the top end of ChinaCache's guidance by 14%. This represents a 23.2% increase from the previous quarter and a 50.8% increase year-over-year.
  • Gross profit in the fourth quarter was RMB107.2 million (US$17.7 million), an increase of 22.3% from the previous quarter and up 58.4% year-over-year.
  • Adjusted EBITDA (non-GAAP) in the fourth quarter was RMB20.3 million (US$3.4 million), a 421.9% increase from the prior quarter and a year-over-year increase of RMB26.2 million.
  • Net loss attributable to ordinary shareholders in the fourth quarter was RMB11.9 million (US$2.0 million), compared to a net loss attributable to ordinary shareholders of RMB22.7 million in the third quarter of 2013 and a net loss attributable to ordinary shareholders of RMB26.7 million in the corresponding period in 2012.
  • Adjusted net loss (non-GAAP) was RMB5.0 million (US$0.8 million) in the fourth quarter, compared to adjusted net loss of RMB16.0 million in the third quarter and an adjusted net loss of RMB19.9 million in the corresponding period in 2012.

Highlights for the Full Year 2013

  • Net revenues in 2013 reached a record high of RMB1,103.2 million (US$182.2 million), representing a 35.6% increase from the previous year.
  • Gross profit in 2013 was RMB346.6 million (US$57.3 million), up 36.3% from 2012.
  • Adjusted EBITDA (non-GAAP) in 2013 was RMB46.2 million (US$7.6 million), a 33.2% decrease from the previous year.
  • Net loss attributable to ordinary shareholders in 2013 was RMB32.1 million (US$5.3 million), compared to a net loss attributable to ordinary shareholders of RMB17.0 million in 2012.
  • Adjusted net loss (non-GAAP) was RMB15.8 million (US$2.6 million) in 2013, compared to an adjusted net income of RMB3.4 million in 2012.

"2013 was a year of dynamic growth for our Company. We made critical advancements across our operations and reached record revenue for both the year and the fourth quarter," said Mr. Song Wang, Founder, Chairman and Chief Executive Officer of ChinaCache. "During the year, we continued to ramp up our business and made key investments in our ERP and CRM systems, operations platforms, talent and mobile internet. This strategy has enabled us to markedly improve customer engagement and mobile Internet technology development, as well as our international market expansion capabilities and operating efficiency to drive our near- and longer-term success.

China's thriving Internet industry continues to support our growth. Today, we are serving more than 330 million desktop and mobile Internet users, and supporting more than 2.6 billion webpage displays daily through our network. In 2013, we celebrated our 15th anniversary as the leader in China's CDN industry and we are working to expand our global footprint. Along with international expansion ambition, an important part of our growth strategy has been to amass enterprise customers, and we have made a great deal of progress in the past year," Mr. Wang continued. "Our goal is to extend faster and steadier Internet capabilities across China through the build out of next generation mobile network 4G and cloud computing infrastructure. Our mobile initiatives are well underway. Meanwhile, we are committed to improving our internal cloud adoption and external cloud offerings to support the market's evolving needs. With the implementation of our own private cloud planned for later this year, we expect to notably lower our operating costs and increase productivity. We believe there remains a great deal of opportunity for us to expand, riding on the explosive internet traffic growth. In order to service the growing needs, we will continue to focus our resources on developing technologies that enhance mobile internet, video and OTT video, and e-commerce experiences. Cloud adoption is also vigorously driving CDN traffic. And at the same time, we are deepening our cooperation with carriers. These will be our focus areas in 2014 as we continue to meet our growth objectives, while working toward achieving sustainable profitability."

Fourth Quarter 2013 Financial Results

Net revenues for the fourth quarter of 2013 were RMB339.4 million (US$56.1 million), representing a 23.2% increase from the third quarter of 2013 and a 50.8% increase from the corresponding period in 2012. The growth in net revenues was across ChinaCache's business, specifically from the Internet & Software, Media & Entertainment and Ecommerce verticals, which increased 40.0%, 23.2% and 23.2% quarter-over-quarter, respectively.

Cost of revenues for the fourth quarter increased by 23.6% quarter-over-quarter, and 47.6% year-over-year to RMB232.2 million (US$38.4 million). Gross margin was 31.6%, compared to 31.8% in the previous quarter and 30.1% in the corresponding period in 2012. Non-GAAP gross margin, which excludes share-based compensation and depreciation and amortization expenses, was 35.7%, compared to 36.3% in the third quarter and 35.1% in the corresponding period in 2012.

Sales and marketing expenses for the fourth quarter increased by 25.7% from the previous quarter to RMB38.0 million (US$6.3 million) and increased by 38.9% year-over-year, reaching 11.2% of net revenues. The increases in sales and marketing expenses were primarily attributable to increased personnel-related expenses and more marketing activities during the end of the year.

General and administrative expenses for the fourth quarter decreased by 10.0% over the previous quarter to RMB43.4 million (US$7.2 million) and increased slightly year-over-year, reaching 12.8% of net revenues. The sequential decrease in general and administrative expenses was primarily attributable to the previous quarter's accrual of bad debt provision.

Research and development expenses for the fourth quarter increased by 16.5% over the previous quarter to RMB30.6 million (US$5.0 million), and increased by 46.5% year-over-year, reaching 9.0% of net revenues. These increases were mainly attributable to increased personnel-related expenses for continued efforts in mobile internet and enterprise solutions development.

Impairment of available-for-sale investment for the fourth quarter was RMB1.2 million (US$0.2 million).

Operating loss was RMB6.0 million (US$1.0 million) in the fourth quarter of 2013, compared to RMB17.1 million in the previous quarter and RMB23.8 million in the corresponding period in 2012. Non-GAAP operating loss, which excludes share-based compensation expenses and impairment of available-for-sale investment, was RMB1.1 million (US$0.2 million), compared with a non-GAAP operating loss of RMB12.2 million in the third quarter of 2013 and a non-GAAP operating loss of RMB20.8 million in the fourth quarter of 2012. These results reflect the Company's investments in its long-term growth initiatives.

Income tax expense was RMB7.3 million (US$1.2 million) in the fourth quarter of 2013, compared to an income tax expense of RMB3.9 million in the third quarter of 2013 and an income tax benefit of RMB0.3 million in the corresponding period in 2012.

Net loss was RMB11.9 million (US$2.0 million) in the fourth quarter of 2013, compared to RMB22.7 million in the third quarter of 2013, and RMB26.7 million in the corresponding period in 2012. Net loss per American depositary share ("ADS") for the fourth quarter of 2013 was RMB0.52 (US$0.09). Each ADS represents 16 ordinary shares of the Company.

Adjusted net loss (non-GAAP), defined as net loss before share-based compensation expenses, foreign exchange loss, penalties on uncertain tax positions and impairment of available-for-sale investment, was RMB5.0 million (US$0.8 million), compared to RMB16.0 million in the third quarter of 2013 and RMB19.9 million in the corresponding period in 2012. Non-GAAP net loss per ADS for the fourth quarter of 2013 amounted to RMB0.22 (US$0.04).

Adjusted EBITDA (non-GAAP), defined as EBITDA excluding share-based compensation expenses, foreign exchange and impairment of available-for-sale investment, was RMB20.3 million (US$3.4 million), compared to an adjusted EBITDA of RMB3.9 million in the third quarter of 2013, and an adjusted EBITDA loss of RMB5.9 million in the corresponding period in 2012.

Capital Resources

As of December 31, 2013, the Company had cash and cash equivalents of RMB338.1 million (US$55.8 million). In addition, the Company had an available-for-sale investment amounting to RMB24.6 million (US$4.1 million) in an RMB-denominated fund, which is presented as current assets. Capital expenditures for the fourth quarter of 2013 were RMB32.9 million (US$5.4 million).

Share Repurchases

On June 21, 2013, the Company's Board authorized the Company to resume its previously announced US$10 million share repurchase plan. Under the resumed plan, ChinaCache is authorized, but not obligated, to repurchase up to US$8.5 million worth of its ADSs over the next 12 months on the open market or in block trades.

As of March 7, 2014, the Company has not repurchased any ADSs under this buyback program on the open market.

Full Year 2013 Financial Results

For the full year ended December 31, 2013, net revenues were RMB1,103.2 million (US$182.2 million), representing a 35.6% increase from the previous year. Gross profit in 2013 was RMB346.6 million (US$57.3 million), up 36.3% from 2012. Adjusted EBITDA (non-GAAP) in 2013 was RMB46.2 million (US$7.6 million), a 33.2% decrease from the previous year. Net loss in 2013 was RMB32.1 million (US$5.3 million), compared to RMB17.0 million in 2012. Adjusted net loss (non-GAAP) was RMB15.8 million (US$2.6 million) in 2012, compared to an adjusted net income of RMB3.4 million in 2012.

Outlook for the Company's First Quarter of 2014

ChinaCache currently expects to generate total net revenues ranging from RMB303.0 million (US$50.1 million) to RMB308.0 million (US$50.9 million) for the first quarter of 2014, representing 31.3% to 33.5% increase year-over-year. This forecast reflects ChinaCache's current and preliminary view, which is subject to change.

Conference Call Information

The Company has scheduled a conference call to discuss these results at 8:00 PM Eastern Standard Time on March 12, 2014, which corresponds to 8:00 AM Beijing time on March 13, 2014

The dial-in details for the live conference call are as follows:

  • U.S. dial-in number: +1 (845) 675-0438
  • Hong Kong dial-in number: +852 3051-2745
  • International dial-in number: +65 6723-9385
  • China dial-in number: 400-1200-654
  • Conference ID: 1148567

A live and archived webcast of the conference call will be available on the Investor Relations section of ChinaCache's website at www.chinacache.com.

A replay of the conference call will also be available approximately two hours after the conclusion of the live call until March 12, 2014 by dialing:

  • U.S. dial-in number: +1 (855) 452-5696
  • International dial-in number: +61 (2) 8199-0299
  • China dial-in number: 400-1200-932
  • Conference ID: 1148567

About ChinaCache International Holdings Ltd.

ChinaCache International Holdings Ltd. (Nasdaq:CCIH) is the leading total solutions provider of Internet content and application delivery services in China. As a carrier-neutral service provider, ChinaCache's network in China is interconnected with networks operated by all telecom carriers, major non-carriers and local Internet service providers. With more than a decade of experience in developing solutions tailored to China's complex Internet infrastructure, ChinaCache is a partner of choice for businesses, government agencies and other enterprises to enhance the reliability and scalability of online services and applications and improve end-user experience. For more information on ChinaCache, please visit en.chinacache.com.

*Use of Non-GAAP Financial Measures

In evaluating its business, ChinaCache considers and uses the following non-GAAP measures defined as non-GAAP financial measures by the SEC as supplemental measures to review and assess its operating performance: non-GAAP gross profit, non-GAAP sales and marketing expenses, non-GAAP general and administrative expenses, non-GAAP research and development expenses, non-GAAP operating income/(loss), adjusted net income/(loss) (non-GAAP), EBITDA and adjusted EBITDA (non-GAAP). The presentation of these non-GAAP financial measures is not intended to be considered in isolation 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 "Reconciliations of Non-GAAP to GAAP Financial Measures" set forth at the end of this press release.

To present non-GAAP sales and marketing expenses, non-GAAP general and administrative expenses and non-GAAP research and development expenses, the Company excludes share-based compensation expense.

To present non-GAAP gross profit, the Company excludes depreciation and amortization expenses and share-based compensation expense.

To present non-GAAP operating income/(loss), the Company excludes share-based compensation expense and impairment of available-for-sale investment.

The Company defines adjusted net income/(loss) as net income/(loss) before share-based compensation expense, foreign exchange loss or gain, penalties on uncertain tax positions and impairment of available-for-sale investment.

The Company uses EBITDA to assist in reconciliation to adjusted EBITDA. The Company defines EBITDA as net income/(loss) before interest expense, interest income, income tax expense and penalties on uncertain tax positions and depreciation and amortization. The Company defines adjusted EBITDA as EBITDA before share-based compensation expense, foreign exchange loss or gain and impairment of available-for-sale investment that the Company does not consider reflective of its ongoing operations. The Company believes that the use of adjusted EBITDA facilitates investors' use of operating performance comparisons from period to period and company to company by backing out potential differences caused by variations in items such as capital structure (affecting relative interest expense and share-based compensation expense), the book amortization of intangibles (affecting relative amortization expense), the age and book value of facilities and equipment (affecting relative depreciation expense) and other non-cash expenses. The Company also presents adjusted EBITDA because it believes it is frequently used by securities analysts, investors and other interested parties as a measure of the financial performance of companies in its industry.

Those non-GAAP financial measures are not defined under U.S. GAAP and are not measures presented in accordance with U.S. GAAP. Those non-GAAP financial measures have limitations as analytical tools, and when assessing the Company's operating performance, investors should not consider them in isolation, or as a substitute for net income (loss) or other consolidated income statement data prepared in accordance with U.S. GAAP. Some of these limitations include, but are not limited to:

  • Adjusted net income/(loss), EBITDA and adjusted EBITDA do not reflect the Company's cash expenditures or future requirements for capital expenditures or contractual commitments;
  • They do not reflect changes in, or cash requirements for, the Company's working capital needs;
  • They do not reflect the interest expense, or the cash requirements necessary to service interest or principal payments, on the Company's debt;
  • They do not reflect income taxes or the cash requirements for any tax payments;
  • Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized often will have to be replaced in the future, and adjusted net income/(loss), EBITDA and adjusted EBITDA do not reflect any cash requirements for such replacements;
  • While share-based compensation is a component of cost of revenues and operating expenses, the impact on the Company's financial statements compared to other companies can vary significantly due to such factors as assumed life of the options and assumed volatility of the Company's ordinary shares; and
  • Other companies may calculate adjusted net income/(loss), EBITDA and adjusted EBITDA differently than the Company does, limiting their usefulness as comparative measures.

Exchange Rate Information

This announcement 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 based on the effective exchange rate of 6.0537 as of December 31, 2013.

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 outlook for the first quarter of 2014 and quotations from management in this announcement, as well as ChinaCache's strategic and operational plans, contain forward-looking statements. ChinaCache may also make written or oral forward-looking statements in its reports filed 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. 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 statements, including but not limited to the following: the Company's goals and strategies, expansion plans, the expected growth of the content and application delivery services market, the Company's expectations regarding keeping and strengthening its relationships with its customers, and the general economic and business conditions in the regions where the Company provides its solutions and services. Further information regarding these and other risks is included in the Company's filings with the U.S. Securities and Exchange Commission. All information provided in this press release is as of the date of this press release, and ChinaCache undertakes no duty to update such information, except as required under applicable law.

FINANCIAL TABLES

  • Unaudited Condensed Consolidated Balance Sheets
  • Unaudited Condensed Consolidated Statements of Comprehensive Income
  • Supplementary Financial Data
  • Supplementary Operating Metrics
  • Reconciliations of Non-GAAP to GAAP Financial Measures
 
Condensed Consolidated Balance Sheets
(amounts in thousands)
       
  As of Dec 31 As of Dec 31 As of Dec 31
  2012 2013 2013
   RMB   RMB   US$ 
  (Audited) (Unaudited) (Unaudited)
 ASSETS       
 Current assets       
 Cash and cash equivalents  317,137 338,092 55,849
 Restricted Cash   --  60,000 9,911
 Accounts receivable, net  230,199 306,237 50,587
 Prepaid expenses and other current assets  31,240 50,549 8,351
 Available-for-sale investment   --  24,636 4,070
 Deferred tax assets  13,626 7,096 1,172
 Amount due from a related party  8,640 141 23
 Total current assets  600,842 786,751 129,963
       
 Non-current assets       
 Property, plant and equipment, net  179,239 240,650 39,753
 IDC facility construction in progress   --  12,236 2,021
 Intangible assets, net  3,368 5,563 919
 Land use right, net   --  50,730 8,380
 Long term investments  15,136 21,450 3,543
 Available-for-sale investments  82,292 12,240 2,022
 Deferred tax assets  6,166 1,719 284
 Other non-current assets  13,847 35,829 5,919
 Total non-current assets  300,048 380,417 62,841
       
 Total Assets  900,890 1,167,168 192,804
       
 LIABILITIES AND SHAREHOLDERS' EQUITY       
 Current Liabilities       
 Short term loan   --  60,000 9,911
 Accounts payable  106,399 203,750 33,657
 Accrued employee benefits  36,084 43,922 7,255
 Accrued expenses and other payables  57,773 157,075 25,947
 Income tax payable  22,537 10,399 1,718
 Liabilities for uncertain tax positions  11,786 11,540 1,906
 Amounts due to related parties  1,062 862 142
 Deferred government grant   --  24,360 4,024
 Total current liabilities  235,641 511,908 84,560
       
 Non-current liabilities       
 Deferred government grant  3,360  --   -- 
 Total non-current liabilities  3,360  --   -- 
       
 Total Liabilities  239,001 511,908 84,560
       
 Total Shareholders' equity  661,889 655,260 108,244
       
 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY  900,890 1,167,168 192,804

 

Condensed Consolidated Statements of Comprehensive Income
(amounts in thousands, except for number of shares, per share and per ADS data)
               
  For the Three Months Ended For the Twelve Months Ended
  Dec 31, 2012 Sep 30, 2013 Dec 31, 2013 Dec 31, 2013 Dec 31, 2012 Dec 31, 2013 Dec 31, 2013
  RMB RMB RMB US$ RMB RMB US$
  (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Audited) (Unaudited) (Unaudited)
               
Net revenues  225,019  275,392  339,373  56,060  813,732  1,103,243  182,243
Cost of revenues  (157,372)  (187,793)  (232,203)  (38,357)  (559,460)  (756,617)  (124,984)
               
Gross profit  67,647  87,599  107,170  17,703  254,272  346,626  57,259
Sales & marketing expenses  (27,376)  (30,235)  (38,017)  (6,280)  (87,597)  (124,578)  (20,579)
General & administrative expenses  (43,225)  (48,206)  (43,409)  (7,171)  (106,115)  (153,568)  (25,368)
Research & development expenses  (20,856)  (26,228)  (30,555)  (5,047)  (68,523)  (102,704)  (16,965)
Impairment of available-for-sale investment  --   --   (1,217)  (201)  --   (1,217)  (201)
               
Operating loss  (23,810)  (17,070)  (6,028)  (996)  (7,963)  (35,441)  (5,854)
Interest income  309  1,273  459  76  1,844  2,513  415
Interest expense  (575)  (1,609)  (1,275)  (211)  (1,340)  (3,584)  (592)
Other (expense)/income   (1,867)  431  3,973  656  (1,758)  6,886  1,137
Foreign exchange loss, net  (994)  (1,913)  (1,735)  (287)  (1,481)  (3,308)  (546)
               
Loss before income taxes  (26,937)  (18,888)  (4,606)  (762)  (10,698)  (32,934)  (5,440)
Income tax benefit/(expense)  266  (3,857)  (7,283)  (1,203)  (6,293)  832  137
               
Net loss attributable to ordinary shareholders  (26,671)  (22,745)  (11,889)  (1,965)  (16,991)  (32,102)  (5,303)
               
Foreign currency translation  77  337  (2,328)  (385)  29  (1,975)  (326)
Unrealized holding gains arising during the period  478  726  175  29  1,537  1,764  291
Reclassification adjustments for gains included in net loss  (167)  (323)  (442)  (73)  (167)  (1,855)  (306)
               
Total other comprehensive income/(loss), net of tax  388  740  (2,595)  (429)  1,399  (2,066)  (341)
               
Comprehensive loss  (26,283)  (22,005)  (14,484)  (2,394)  (15,592)  (34,168)  (5,644)
               
Loss per ordinary share:              
Basic (0.07) (0.06) (0.03) (0.01) (0.05) (0.09)  (0.01)
Diluted (0.07) (0.06) (0.03) (0.01) (0.05) (0.09)  (0.01)
               
Loss per ADS*:              
Basic (1.17) (1.00) (0.52) (0.09) (0.75) (1.42)  (0.23)
Diluted (1.17) (1.00) (0.52) (0.09) (0.75) (1.42)  (0.23)
               
Weighted average number of ordinary shares used in loss per share computation:              
Basic  363,282,183  365,306,073  367,762,251  367,762,251  363,780,875  362,916,540  362,916,540
Diluted  363,282,183  365,306,073  367,762,251  367,762,251  363,780,875  362,916,540  362,916,540
               
*Note1:1 ADS = 16 shares
 Note2: Non-GAAP Financial Measures

 

Supplementary Financial Data
(amounts in thousands, except for percentages)
               
  For the Three Months Ended For the Twelve Months Ended
  Dec 31, 2012 Sep 30, 2013 Dec 31, 2013 Dec 31, 2013 Dec 31, 2012 Dec 31, 2013 Dec 31, 2013
  RMB RMB RMB US$ RMB RMB US$
  (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited)
               
Cost of revenues breakdown:              
Bandwidth, co-location and storage fees  137,313  155,667  202,305  33,418 468,783 640,983 105,883
Depreciation and amortization expenses  10,880  11,769  13,790  2,278 51,911 46,680 7,711
Payroll and other compensation costs of network operations personnel  7,673  12,269  13,371  2,209 25,427 45,763 7,560
Other cost of revenues  1,506  8,088  2,737  452 13,339 23,191 3,830
Total cost of revenues  157,372  187,793  232,203  38,357 559,460 756,617 124,984
               
Allocation of share-based compensation expenses:              
Cost of revenues  545  535  302  50 2,896 1,665 275
Sales and marketing expenses  1,300  1,218  656  108 6,917 3,853 636
General and administrative expenses  605  2,162  2,022  334 3,219 3,833 633
Research and development expenses  574  923  704  116 3,056 2,501 413
Total share-based compensation expenses  3,024  4,838  3,684  608 16,088 11,852 1,957
               
Depreciation and amortization expenses:              
Cost of revenues  10,880  11,769  13,790  2,278 51,911 46,680 7,711
Sales and marketing expenses  262  99  124  20 712 280 46
General and administrative expenses  414  1,667  1,269  210 1,171 6,499 1,074
Research and development expenses  2,464  2,159  2,061  340 6,096 8,309 1,373
Total depreciation and amortization expenses  14,020  15,694  17,244  2,848 59,890 61,768 10,204
               
Capital expenditures  15,977  22,689  32,886 5,432 88,741 139,603 23,061
As a percentage of net revenues 7.1% 8.2% 9.7% 9.7% 10.9% 12.7% 12.7%

 

Supplementary Operating Metrics
(Unaudited)
             
  Sep 30, Dec 31, Mar 31, Jun 30, Sep 30, Dec 31,
  2012 2012 2013 2013 2013  2013
             
Revenues breakdown by industry verticals            
             
Internet and software 20% 21% 20% 20% 22% 25%
Mobile internet 18% 17% 17% 17% 17% 15%
Media and entertainment 29% 30% 30% 29% 27% 27%
E-commerce 24% 23% 22% 22% 21% 21%
Enterprises 5% 6% 8% 9% 10% 10%
Government agencies 4% 3% 3% 3% 3% 2%
Total 100% 100% 100% 100% 100% 100%
             
Revenue contributed by Top 5 customers as a percentage of revenues 22% 27% 28% 33% 33% 39%
             
Number of active customers 1,138 1,265 1,363 1,476 1,589 1,697
             
Number of employees  758 900 1,060 1,257 1,265 1,239
             

 

Supplementary Metrics - Reconciliations of Non-GAAP to GAAP Financial Measures
               
(amounts in thousands, except for percentages, number of shares, per share and per ADS data)
(Unaudited)
               
               
  For the Three Months Ended For the Twelve Months Ended
  Dec 31, 2012 Sep 30, 2013 Dec 31, 2013 Dec 31, 2013 Dec 31, 2012 Dec 31, 2013 Dec 31, 2013
  RMB RMB RMB US$ RMB RMB US$
Adjusted EBITDA — defined as EBITDA before share-based compensation expense, foreign exchange loss and impairment of available-for-sale investment              
               
Net Loss  (26,671)  (22,745)  (11,889)  (1,965)  (16,991)  (32,102)  (5,303)
Depreciation  14,020  15,258  16,613  2,744  59,890  59,877  9,892
Amortization  --   436  631  104  --  1,891  312.00
Interest expense  575  1,609  1,275  211  1,340  3,584  592
Interest income  (309)  (1,273)  (459)  (76)  (1,844)  (2,513)  (415)
Income tax (benefit)/expense  (266)  3,857  7,283  1,203  6,293  (832)  (137)
Share-based compensation  3,024  4,838  3,684  608  16,088  11,852  1,957
Foreign exchange loss  994  1,913  1,735  287  1,481  3,308  546
Penalties on uncertain tax positions  2,775  --   229  38  2,797  (123)  (20)
Impairment of available-for-sale investment  --   --   1,217  201  --   1,217  201
Adjusted EBITDA  (5,858)  3,893  20,319  3,355  69,054  46,159  7,625
Margin% (2.6%) 1.4% 6.0% 6.0% 8.5% 4.2% 4.2%
               
               
Adjusted net income — defined as net loss before share-based compensation, foreign exchange loss, penalties on uncertain tax positions and impairment of available-for-sale Investment              
               
Net Loss  (26,671)  (22,745)  (11,889)  (1,965)  (16,991)  (32,102)  (5,303)
Share-based compensation  3,024  4,838  3,684  608  16,088  11,852  1,957
Foreign exchange loss  994  1,913  1,735  287  1,481  3,308  546
Penalties on uncertain tax positions  2,775  --   229  38  2,797  (123)  (20)
Impairment of available-for-sale Investment  --   --   1,217  201  --   1,217  201
Adjusted net (loss)/gain  (19,878)  (15,994)  (5,024)  (831)  3,375  (15,848)  (2,619)
Margin% (8.8%) (5.8%) (1.5%) (1.5%) 0.4% (1.4%) (1.4%)
(Loss)/Earnings per ordinary share:              
Basic (0.05) (0.04) (0.01) 0.00 0.01 (0.04) (0.01)
Diluted (0.05) (0.04) (0.01) 0.00 0.01 (0.04) (0.01)
(Loss)/Earnings per ADS:              
Basic (0.88) (0.70) (0.22) (0.04) 0.15 (0.70) (0.12)
Diluted (0.88) (0.70) (0.22) (0.04) 0.15 (0.70) (0.12)
               
               
Non-GAAP gross profit – defined as gross profit before share-based compensation expense and depreciation and amortization              
               
Gross profit  67,647  87,599  107,170  17,703  254,272  346,626  57,259
Plus: depreciation and amortization  10,880  11,769  13,790  2,278  51,911  46,680  7,711
Plus: Share-based compensation  545  535  302  50  2,896  1,665  275
Non-GAAP gross profit  79,072  99,903  121,262  20,031  309,079  394,971  65,245
Margin% 35.1% 36.3% 35.7% 35.7% 38.0% 35.8% 35.8%
               
               
Non-GAAP operating expense – defined as operating expense before share-based compensation expense              
               
Sales & marketing expenses  27,376  30,235  38,017  6,280  87,597  124,578  20,579
Minus: Share-based compensation  (1,300)  (1,218)  (656)  (108)  (6,917)  (3,853)  (636)
Non-GAAP sales & marketing expenses  26,076  29,017  37,361  6,172  80,680  120,725  19,943
% of net revenues 11.6% 10.5% 11.0% 11.0% 9.9% 10.9% 10.9%
               
General & administrative expenses  43,225  48,206  43,409  7,171  106,115  153,568  25,368
Minus: Share-based compensation  (605)  (2,162)  (2,022)  (334)  (3,219)  (3,833)  (633)
Non-GAAP general & administrative expenses  42,620  46,044  41,387  6,837  102,896  149,735  24,735
% of net revenues 18.9% 16.7% 12.2% 12.2% 12.6% 13.6% 13.6%
               
Research & development expenses  20,856  26,228  30,555  5,047  68,523  102,704  16,965
Minus: Share-based compensation  (574)  (923)  (704)  (116)  (3,056)  (2,501)  (413)
Non-GAAP research & development expenses  20,282  25,305  29,851  4,931  65,467  100,203  16,552
% of net revenues 9.0% 9.2% 8.8% 8.8% 8.0% 9.1% 9.1%
               
               
Non-GAAP operating loss — defined as GAAP operating (loss)/income before share-based compensation expense and impairment of available-for-sale investment              
               
Operating loss  (23,810)  (17,070)  (6,028)  (996)  (7,963)  (35,441)  (5,854)
Plus: Share-based compensation  3,024  4,838  3,684  608  16,088  11,852  1,957
Plus: Impairment of available-for-sale investment  --   --   1,217  201  --   1,217  201
Non-GAAP operating (loss)/income  (20,786)  (12,232)  (1,127)  (187)  8,125  (22,372)  (3,696)
Margin% (9.2%) (4.4%) (0.3%) (0.3%) 1.0% (2.0%) (2.0%)
               
For investor and media inquiries please contact:

Ms. Edith Kwan
Investor Relations
ChinaCache International Holdings
Tel: +86 (10) 6408 5307
Email: 

Ms. Brandi Larsen
The Piacente Group | Investor Relations
Tel: +1 212-481 2050
Email: