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Jiayuan Announces First Quarter 2012 Financial Results
May 23, 2012 (05:05 PM EDT)


BEIJING, May 23, 2012 /PRNewswire-Asia-FirstCall/ -- Jiayuan.com International Ltd. ("Jiayuan" or "the Company") (NASDAQ: DATE), operator of the largest online dating platform in China, today announced its unaudited financial results for the first quarter ended March 31, 2012.

First Quarter 2012 Highlights[1]

  • Net revenues for the first quarter 2012 were RMB87.4 million (US$13.9 million), a year-over-year increase of 27.8%.
  • Operating income for the first quarter 2012 was RMB3.9 million (US$622,000), compared to operating income of RMB16.5 million for the corresponding quarter of 2011. Excluding share-based compensation, non-GAAP[2] operating income for the first quarter 2012 was RMB7.8 million (US$1.2 million), compared to non-GAAP operating income of RMB19.2 million for the corresponding quarter of 2011.
  • Net income attributable to Jiayuan for the first quarter 2012 was RMB5.2 million (US$831,000), compared to net income attributable to Jiayuan of RMB12.1 million for the corresponding quarter of 2011. Excluding share-based compensation, non-GAAP net income attributable to Jiayuan for the first quarter of 2012 was RMB9.1 million (US$1.4 million), compared to RMB14.8 million for the corresponding quarter of 2011.

[1] This announcement contains translations of certain Renminbi ("RMB") amounts into U.S. dollar ("US$") amounts at specified rates solely for the convenience of readers. Unless otherwise noted, all translations from RMB amounts into US$ amounts as of and for the quarter ended March 31, 2012, were made at an exchange rate of RMB6.2975 to US$1.00, representing the rate as certified by the H.10 weekly statistical release of the Federal Reserve Board on March 30, 2012. Jiayuan's functional currency is U.S. dollar and reporting currency is RMB.


[2] Explanation of Jiayuan's non-GAAP financial measures and related reconciliations to GAAP financial measures are included in the accompanying "Non-GAAP Financial Measures" and "Reconciliations to Unaudited Condensed Consolidated Statements of Operations".

"In an increasingly competitive market environment, our focus on delivering the industry's best user experience enabled Jiayuan to record solid results for the first quarter, particularly in our online services segment," said Ms. Rose Gong, founder and co-CEO of Jiayuan. "This encouraging performance, especially in the important period following the Chinese New Year, sets us up well for the year ahead. Crucially, our wireless offering continues to quickly build momentum. From a standing start last year, we reached 4.6 million activated downloads by the end of March 2012. This and other peerless service offerings, such as our recently launched online desktop client, set Jiayuan a class apart in China's online dating industry and position us for sustained dominance in the long term."

"Strong growth in our online business drove top-line growth, while prudent cost management enabled significantly improved bottom-line performance," commented Shang Koo, CFO of Jiayuan. "Sales and marketing spending was lower than anticipated as we focused our spending on smarter marketing through more effective channels. User response to our wireless platform has exceeded our expectations, and we expect to be able to quickly ramp up monetization of this exciting potential revenue generator. Looking ahead, we aim to build on our leadership in technology and user experience by focusing on research and development, and we expect to see concrete results from these efforts from the second half of this year."

First Quarter 2012 Operational Results

The number of registered user accounts[3] as of March 31, 2012, was 62,606,271, with approximately 6.7 million new users acquired during the quarter.

The number of average monthly active user accounts[4] for the first quarter 2012 was 5,434,692, compared to 4,744,705 for the corresponding period of 2011 and 5,179,713 for the previous quarter.

The number of average monthly paying user accounts for the first quarter 2012 was 1,171,031, compared to 882,471 for the corresponding period of 2011 and 1,172,159 for the previous quarter.

Average monthly revenue per paying user ("ARPU") for online services for the first quarter 2012 was RMB22.0, compared to RMB21.5 for the corresponding period in 2011 and RMB21.5 for the previous quarter.

[3] The number of registered user accounts is an accumulated amount and includes both accounts that are registered on Jiayuan's online platform and those registered on its wireless platforms.


[4] Active user accounts are registered user accounts through which registered users have logged in to the Jiayuan.com website at least once within a calendar month, in the case of user accounts registered in prior months, or on at least two separate days within a calendar month, including the day of completion of the registration process, in the case of user accounts newly registered in the calendar month.

First Quarter 2012 Financial Results

Jiayuan reported net revenues of RMB87.4 million (US$13.9 million) for the first quarter of 2012, representing a year-over-year increase of 27.8%, primarily due to strong growth in the Company's online services, and a quarter-over-quarter decrease of 1.3% from RMB88.6 million due to a decline in revenues from events and VIP services.

  • Online services contributed RMB77.3 million (US$12.3 million), or 88.4% of net revenues, for the first quarter of 2012, representing a year-over-year increase of 35.5% from RMB57.0 million, and compared to RMB75.7 million for the previous quarter. The year-over-year increase was primarily attributable to an increase in paying user accounts and ARPU. The quarter-over-quarter increase was attributable to improved ARPU.
  • Events and VIP services contributed RMB10.1 million (US$1.6 million), or 11.6% of net revenues for the first quarter of 2012, representing a year-over-year decrease of 2.1% from RMB10.3 million, and a quarter-over-quarter decrease of 20.3% from RMB12.7 million. The decrease was primarily due to a decline in revenues from VIP services due to higher than expected turnover in VIP sales personnel, as well as a reduction in the number of offline events held during the quarter.

Cost of revenues for the first quarter of 2012 was RMB31.1 million (US$4.9 million), representing a year-over-year increase of 41.6% from RMB22.0 million, and a quarter-over-quarter increase of 5.2% from RMB29.6 million. This increase was mainly attributable to the expansion of online services.

Gross profit for the first quarter of 2012 was RMB56.3 million (US$8.9 million), representing a year-over-year increase of 21.3% from RMB46.4 million, and a quarter-over-quarter decrease of 4.6% from RMB59.0 million.

Selling and marketing expenses were RMB35.4 million (US$5.6 million) for the first quarter of 2012, representing a year-over-year increase of 78.8% from RMB19.8 million, and a quarter-over-quarter decrease of 17.8% from RMB43.0 million. The substantial year-over-year increase was attributable to an increase in marketing activities as well as promotional efforts in support of the Company's wireless platform. The sequential decline was mainly due to a special marketing campaign conducted during the fourth quarter of 2011.

General and administrative expenses
were RMB12.9 million (US$2.1 million) for the first quarter of 2012, representing a year-over-year increase of 58.1% from RMB8.2 million for the corresponding quarter of 2011, and a quarter-over-quarter decrease of 19.4% from RMB16.0 million for the fourth quarter of 2011. The increase was primarily attributable to an increase in headcount in support of business expansion, and an increase in professional fees incurred to comply with the rules and regulations associated with being a public company. The sequential decrease was primarily attributable to year-end bonuses expenses incurred in the fourth quarter of 2011.

Research and development expenses were RMB4.1 million (US$650,000) for the first quarter of 2012, compared to RMB1.9 million for the corresponding quarter of 2011 and RMB4.3 million for the previous quarter. The year-over-year increase was due to an increase in the number of research and development personnel in connection with Jiayuan's strategy to enhance its research and development capabilities.

Operating income for the first quarter of 2012 was RMB3.9 million (US$622,000), compared to operating income of RMB16.5 million for the corresponding quarter of 2011, and an operating loss of RMB4.3 million in the previous quarter. Excluding share-based compensation expenses, non-GAAP operating income for the first quarter of 2012 was RMB7.8 million (US$1.2 million), compared to RMB19.2 million for the first quarter of 2011, and non-GAAP operating loss of RMB322,000 from the fourth quarter of 2011. The decline in operating income was a result of an increase in marketing spending in support of the Company's wireless platform, as well as lower monetization of the wireless platform due to it being in the early stages of development.

Foreign currency exchange net gain for the first quarter of 2012 was RMB61,000 (US$10,000), compared to RMB2.8 million for the fourth quarter of 2011 and nil for the corresponding quarter of the previous year. The foreign currency exchange net gain for the fourth quarter of 2011 was mainly attributable to appreciation of the RMB against the U.S. dollar during the period.

Net income attributable to Jiayuan[5] for the first quarter of 2012 was RMB5.2 million (US$831,000), compared to RMB12.1 million for the corresponding quarter of 2011 and net loss attributable to Jiayuan of RMB1.2 million for the fourth quarter of 2011. Excluding share-based compensation expenses, non-GAAP net income attributable to Jiayuan for the first quarter of 2012 was RMB9.1 million (US$1.4 million), compared to RMB14.8 million for the corresponding quarter of 2011, and RMB2.8 million for the fourth quarter of 2011.

Basic and diluted net income per ADS[6] for the first quarter of 2012 were RMB0.17 (US$0.03) and RMB0.16 (US$0.03) respectively, compared to basic and diluted net loss per ADS of RMB0.12(US$0.02) for the first quarter of 2011, and basic and diluted net loss per ADS of RMB0.04(US$0.01), for the fourth quarter of 2011.

Excluding share-based compensation expenses, non-GAAP basic and diluted net income per ADS for the first quarter of 2012 were RMB0.29 (US$0.05) and RMB0.28 (US$0.04) respectively, compared to RMB0.03 (US$0.00) for the first quarter of 2011 and RMB0.09 (US$0.01) for the fourth quarter of 2011.

As of March 31, 2012, Jiayuan had cash and cash equivalents and short-term deposits of RMB600.1 million (US$95.3 million). Cash flows from operating activities for the first quarter of 2012 were RMB15.7 million (US$2.5 million).

The weighted average number of ADSs outstanding used in calculating diluted net income per ADS and non-GAAP diluted net income per ADS in the first quarter of 2012 were 32.9 million. As of March 31, 2012, the Company had 32.3 million ADSs outstanding, including 0.7 million ADSs issued to the depository for future exercise of options.

[5] Since the third quarter of 2011, net income/(loss) attributable to Jiayuan is equivalent to net income/(loss) attributable to ordinary shareholders as all outstanding preferred shares were converted into ordinary shares upon the completion of Jiayuan's IPO in May 2011.


[6] Basic and diluted net income/(loss) per ADS are calculated based on net income/(loss) attributable to ordinary shareholders and the corresponding basic and diluted number of ADSs, assuming that, during each period presented, every two ADSs represent three ordinary shares of Jiayuan.

Management Updates

Jiayuan today announced that the Company's board has accepted the resignation of chief technical officer Mr. Bin Xiao, who is leaving the Company to pursue personal interests, effective June 1, 2012. Mr. Xiao's primary responsibilities will be assumed by Mr. Linguang Wu, co-CEO of Jiayuan.

Second Quarter 2012 Outlook

Jiayuan currently expects to generate net revenues in the range of RMB93 million to RMB95 million for the second quarter of 2012. This forecast reflects Jiayuan's current and preliminary view, which is subject to change.

Conference Call Information

Jiayuan's management will host a conference call to discuss its results and outlook today, at 8 p.m. on May 23, 2012, U.S. Eastern Time (8 a.m. May 24, 2012 Beijing / Hong Kong Time).

Dial-in details for the earnings conference call are as follows:

International:         

 +65-6723-9381

United States:             

 +1-718-3541-231

Hong Kong:                

 +852-2475-0994

United Kingdom:         

 +44-20-3059-8139

China:               

 800-8190-121 (or 400-6208-038 for mobile)



Passcode:    

81282186

A replay of the conference call may be accessed by phone at the following number until May 31, 2012:

International:                      

+61-2-8235-5000



Passcode: 

81282186

A live and archived webcast of the conference call will be available at ir.jiayuan.com.

About Jiayuan

Jiayuan.com International Ltd. ("Jiayuan") (NASDAQ: DATE) operates the largest online dating platform in China. Jiayuan is committed to providing a trusted, effective, and user-focused online dating platform that addresses the dating and marriage needs of China's rapidly growing urban singles population. According to iResearch, Jiayuan.com ranked first in terms of number of unique visitors and time spent among all online dating websites in China in 2011. Every two of Jiayuan's American Depositary Shares represent three ordinary shares.

For more information, please visit http://ir.jiayuan.com.

Forward-Looking Statements

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. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates," "confident" and similar statements. Jiayuan may also make written or verbal forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission, in its annual report to shareholders, in press releases and other written materials and in verbal statements made by its officers, directors or employees to fourth parties. Statements that are not historical facts, including statements about our 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: our growth strategies; our future business development, including development of new products and services; our ability to attract and retain users; competition in the Chinese online dating markets; changes in our revenues and certain cost or expense items as a percentage of our revenues; the outcome of any litigation or arbitration; the expected growth of the number of Internet and broadband users in China; Chinese governmental policies relating to the Internet and online dating websites and general economic conditions in China and elsewhere. Further information regarding these and other risks is included in our documents filed with the U.S. Securities and Exchange Commission. Jiayuan does not undertake any obligation to update any forward-looking statement, except as required under applicable law. All information provided in this press release is as of the date of the press release, and Jiayuan undertakes no duty to update such information, except as required under applicable law.

Non-GAAP Financial Measures

We disclose non-GAAP financial measures of operating income, net income to Jiayuan.com International Ltd, net (loss)/income attributable to ordinary shareholders and net (loss)/income per ADS, each of which is adjusted to exclude share-based compensation expense. We review non-GAAP financial measures to obtain an additional understanding of our operating performance. We also believe it is useful supplemental information for investors and analysts to assess our operating performance without the effect of non-cash share-based compensation expense, which have been and will continue to be significant recurring expenses in our business. For a reconciliation of each of these non-GAAP financial measures to the most directly comparable GAAP financial measures, please see "Reconciliation To Unaudited Condensed Consolidated Statement of Operations" included in this press release.

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 it does not include all items that impact our non-GAAP financial measures during the period. In addition, because non-GAAP financial measures are not calculated in the same manner by all companies, it may not be comparable to other similar titled measures used by other companies. In light of the foregoing limitations, you should not consider non-GAAP financial measures in isolation from or as an alternative to GAAP financial measures. Management compensates for this limitation by providing specific information regarding the GAAP amount excluded from the non-GAAP measure.

For investor and media inquiries, please contact:


Beijing


Melody Liu

Jiayuan.com International Ltd.

+86 (10) 6442-2321

ir@jiayuan.com


Martin Reidy

Brunswick Group LLP

+86 (10) 5960-8600

jiayuan@brunswickgroup.com


New York


Cindy Zheng

Brunswick Group LLP

+1 (212) 333-3810

jiayuan@brunswickgroup.com

 

 JIAYUAN.COM INTERNATIONAL LTD.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(IN THOUSANDS)










March 31,


December 31,


March 31,



2011


2011


2012


2012



RMB


RMB


RMB


US$

ASSETS









Current assets:









Cash and cash equivalents


136,200


181,340


186,999


29,694

Term deposits


30,000


404,500


413,106


65,598

Accounts receivable, net


7,253


16,294


15,413


2,447

Deferred tax assets


1,465


3,045


2,666


423

Prepaid expenses and other current assets


10,377


12,927


15,404


2,446

Total current assets


185,295


618,106


633,588


100,608

Non-current assets:









Term deposit


-


10,000


10,000


1,588

  Property and equipment, net


17,398


27,599


28,249


4,486

Total assets


202,693


655,705


671,837


106,682










LIABILITIES









Current liabilities:









Accounts payable


756


-


2,203


350

Deferred revenue


73,354


78,547


86,452


13,728

Accrued expenses and other current liabilities


14,244


28,817


25,764


4,091

Income tax payable


19,897


14,824


13,605


2,160

Amounts due to a related party


983


-


-


-

Total current liabilities


109,234


122,188


128,024


20,329

Non-current liabilities:









  Deferred revenue – non current portion


-


-


1,234


196

 

Total Liabilities


109,234


122,188


129,258


20,525

Series A redeemable convertible preferred shares


94,856


-


-


-

SHAREHOLDERS' EQUITY









Ordinary shares


210


339


341


54

Additional paid-in capital


384


522,470


528,239


83,881

Statutory reserves


392


5,792


5,792


920

(Accumulated deficit)/Retained earnings


(11,741)


7,956


13,184


2,092

Treasury shares


-


-


(1,518)


(241)

Foreign currency translation adjustments


9,358


(3,040)


(3,459)


(549)

Total shareholders' (deficit)/equity


(1,397)


533,517


542,579


86,157










Total liabilities, redeemable convertible preferred shares and shareholders' equity


202,693


655,705


671,837


 

106,682


 

JIAYUAN.COM INTERNATIONAL LTD.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)






Three months ended,



March 31, 2011


December 31, 2011


March 31, 2012



RMB


RMB


RMB


US$










Net revenues


68,392


88,592


87,409


13,880

Cost of revenues


(21,970)


(29,558)


(31,101)


(4,939)










Gross profit


46,422


59,034


56,308


8,941










Operating expenses:









Selling and marketing expenses


(19,788)


(43,041)


(35,386)


(5,619)

General and administrative expenses


(8,167)


(16,021)


(12,912)


(2,050)

Research and development expenses


(1,923)


(4,318)


(4,095)


(650)

Total operating expenses


(29,878)


(63,380)


(52,393)


(8,319)










Operating income/(loss)


16,544


(4,346)


3,915


622










Interest income, net


394


3,031


3,300


524

Foreign currency exchange  gain, net


-


2,761


61


10

Other (loss) / income, net


(278)


1,955


1,637


260

Income before income tax


16,660


3,401


8,913


1,416

Income tax expenses


(4,514)


(4,606)


(3,685)


(585)










Net (loss) / income attributable to Jiayuan.com International Ltd.


12,146


(1,205)


5, 228


831










Accretion of redeemable convertible preferred shares


(2,243)


-


-


-

Income allocated to participating preferred shareholders


(12,033)


-


-


-










Net (loss)/income attributable to ordinary shareholders


(2,130)


(1,205)


5,228


831










Net (loss)/income per ADS – Basic


(0.12)


(0.04)


0.17


0.03

Net (loss)/income per ADS – Diluted


(0.12)


(0.04)


0.16


0.03










ADSs used in computing basic net (loss)/income per ADS


18,181,818


31,296,296


31,443,735


31,443,735

ADSs used in computing diluted net (loss)/income per ADS


18,181,818


31,296,296


32,871,703


32,871,703











 

JIAYUAN.COM INTERNATIONAL LTD.




RECONCILIATIONS TO UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS




(IN RMB THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)















Three Months Ended March 31, 2011



Three Months Ended December 31, 2011



Three Months Ended March 31, 2012



GAAP


Non-GAAP Adjustments(a)


Non-GAAP



GAAP


Non-GAAP Adjustments(a)


Non-GAAP



GAAP


Non-GAAP Adjustments(a)


Non-GAAP

Operating income/(loss)


16,544


2,627


19,171



(4,346)


4,024


(322)



3,915


3,892


7,807

Net income/(loss) attributable to Jiayuan.com International Ltd.


12,146


2,627


14,773



(1,205)


4,024


2,819



5,228


3,892


9,120

Net (loss)/income attributable to ordinary shareholders


(2,130)


2,627


497



(1,205)


4,024


2,819



5,228


3,892


9,120

Basic net (loss)/income per ADS


(0.12)




0.03



(0.04)




0.09



0.17




0.29

Diluted net (loss)/income per ADS


(0.12)




0.03



(0.04)




0.09



0.16




0.28

ADSs used in computing basic net (loss)/income per ADS


18,181,818




18,181,818



31,296,296




31,296,296



31,443,735




31,443.735

ADSs used in computing diluted net (loss)/ income per ADS


18,181,818




19,310,840



31,296,296




32,970,806



32,871,703




32,871,703


Note:

(a)    To adjust for share-based compensation expense.


SOURCE Jiayuan.com International Ltd.