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    BEST Inc. Announces Unaudited Second Quarter 2022 Financial Results

    8/17/22 6:05:00 AM ET
    $BEST
    Trucking Freight/Courier Services
    Industrials
    Get the next $BEST alert in real time by email

    HANGZHOU, China, Aug. 17, 2022 /PRNewswire/ -- BEST Inc. (NYSE:BEST) ("BEST" or the "Company"), a leading integrated smart supply chain solutions and logistics services provider in China and Southeast Asia ("SEA"), today announced its unaudited financial results for the second quarter ended June 30, 2022.

    logo (PRNewsfoto/BEST Inc.)

    Johnny Chou, Founder, Chairman and CEO of BEST, commented, "The impact of the COVID-19 pandemic continued to weigh heavily on the overall economy growth in China and SEA. Despite these headwinds in the second quarter, BEST Supply Chain Management ("SCM") achieved profitability while BEST Freight's loss has significantly narrowed compared with the first quarter.  In addition, our U.S. operations continued to be profitable for the period."  

    "We maintained our focus on service quality, customer experience and efficiency improvement during the quarter. BEST Freight increased its on-time delivery rate by 11.4% quarter over quarter.  Freight's net loss narrowed by RMB115.7 million compared with the first quarter as we continued to reduce expenses and improve operating efficiency. BEST SCM achieved profitability due to our continuous focus on high margin key accounts and our cost reduction initiatives."

    "For BEST Global, we have significantly strengthened the quality of our services, including on-time delivery improvement that benefitted from the utilization of information technology and better infrastructure management of Global's operations. We will accelerate our B2B2C and cross border business among PRC, SEA and the U.S. by synergizing with SCM and Freight. With these synergies and our cross-border initiatives, we are confident that BEST Global will return to its growth trajectory by the end of this year."

    "We are encouraged by the progress we have made since the launch of our Strategic Refocusing Program. Today we are operating as a leaner and more focused organization. As the pandemic eases, we are confident that BEST's strength in technology, domestic and global supply chain management and logistics capabilities will allow us to rebound strongly and on the path to profitability." concluded Mr. Chou.

    Gloria Fan, BEST's Chief Financial Officer, added, "While our second quarter revenue was impacted by the pandemic, we are pleased that our net loss from continuing operations narrowed significantly by RMB87.5 million or 27.1% quarter over quarter, excluding the one-time expenses associated with the Capital wind-down and ADS ratio change. We also maintained a strong balance sheet with cash and cash equivalents, restricted cash, and short-term investments of RMB4.4 billion, and a net cash position of RMB1.4 billion at the end of the second quarter. As we drive value for our customers through our Freight, integrated Supply Chain Management and Global logistics solutions, we believe we are on the right path to deliver sustainable growth and profitability."

    FINANCIAL HIGHLIGHTS(1) 

    For the Second Quarter Ended June 30, 2022:(2)

    • Revenue was RMB1,926.4 million (US$287.6 million), compared to RMB3,093.3 million in the second quarter of 2021. The decrease was primarily due to the winding-down of the BEST UCargo business line and lower volume of Freight and Global due to the COVID-19 pandemic. Revenue generated from UCargo was approximately RMB0.2 million (US$0.03 million), compared with RMB860.4 million in the same quarter of 2021.
    • Gross Loss was RMB93.8 million (US$14.0 million), compared to a gross profit of RMB86.2 million in the second quarter of 2021. The decrease was primarily due to the increased unit cost of the Freight and Global businesses and winding-down of the BEST Capital business line. Gross Loss Margin was 4.9%, compared to a Gross Profit Margin of 2.8% in the second quarter of 2021.
    • Net Loss from continuing operations was RMB337.1 million (US$50.3 million), compared to RMB146.9 million in the second quarter of 2021. Non-GAAP Net Loss from continuing operations(3)(4) was RMB317.2 million (US$47.4 million), compared to RMB116.9 million in the second quarter of 2021.
    • Diluted loss per ADS(5) from continuing operations was RMB3.88 (US$0.58), compared to a loss of RMB1.82 in the second quarter of 2021. Non-GAAP diluted loss per ADS(3)(4) from continuing operations was RMB3.63 (US$0.54), compared to a loss of RMB1.43 in the second quarter of 2021.
    • EBITDA(6) from continuing operations was negative RMB287.2 million (US$42.9 million), compared to negative RMB80.6 million in the second quarter of 2021. Adjusted EBITDA(6) from continuing operations was negative RMB267.3 million (US$39.9 million), compared to negative RMB50.6 million in the second quarter of 2021.

    BUSINESS HIGHLIGHTS(7) 

    BEST Freight – In the second quarter of 2022, the Company remained focused on developing its e-commerce related business, which contributed 20.4% of total volume, up 1.2% year over year. Freight's operations were significantly affected by the continued industry-wide logistics disruptions caused by the COVID-19 pandemic. Its volume decreased by 8.8% year over year, as some of its transportation fleet, hubs and sortation centers, have been restricted due to the pandemic.

    However, as a result of continued expense control efforts and operating efficiency improvements in the second quarter, the net loss of Freight narrowed by RMB115.7 million or 66.8% to RMB57.4 million while its on-time delivery rate improved by 11.4% quarter over quarter.

    BEST UCargo's operations and financial results are now consolidated with BEST Freight. 

    BEST Supply Chain Management – During the second quarter of 2022, the Company continued to grow its B2B2C fulfillment network and distribution capabilities ("Cloud OFCs") while prioritizing higher-margin accounts. The total number of orders fulfilled by Cloud OFCs increased by 7.6% quarter over quarter to 94.0 million in the second quarter of 2022, and the total number of orders fulfilled by franchised Cloud OFCs increased by 9.0% quarter over quarter to 58.9 million. SCM's gross margin improved by 3.9% to 8.2%, which led to a net profit of RMB12.1 million versus a net loss of RMB20.8 million in the first quarter of 2022.

    On the year over year basis, the resurgence of the pandemic and its related controls in the second quarter has severely impacted numbers of orders fulfilled by our B2B2C fulfillment network as many of our warehouses were restricted during the quarter. The total number of orders fulfilled by Cloud OFCs decreased by 22.0% to 94.0 million in the second quarter while the total number of orders fulfilled by franchised Cloud OFCs decreased by 19.4% to 58.9 million.

    BEST Global – The pandemic and its related controls significantly impacted e-commerce businesses in SEA and restrained the cross border activities between SEA and China. As a result, Global's parcel volume decreased by 20.6% year over year, which was 30.8 million in the second quarter of 2022.  Despite SEA's lower volume in the second quarter, our U.S. operations continued to be profitable in the second quarter of 2022.

    Others

    As part of its Strategic Refocusing Program, the Company continued to wind down its Capital business line in the second quarter of 2022 and expects such winding-down to be substantially completed by the end of 2022.

    Key Operational Metrics



    Three Months Ended

    % Change YOY



    June 30, 2020



    June 30, 2021



    June 30, 2022



    2021 vs

    2020



    2022 vs

    2021











    Freight Volume (Tonne in '000)

    2,230



    2,438

    2,223



    9.3 %



    (8.8 %)

    Supply Chain Management

    Orders Fulfilled (in '000)

    111,332

    120,471

    93,960



    8.2 %

    (22.0 %)

    Global Parcel Volume in SEA

     (in '000)

    16,100



    38,761



    30,782



    140.7 %



    (20.6 %)























    FINANCIAL RESULTS(8) 

    For the Second Quarter Ended June 30, 2022:

    Revenue

    The following table sets forth a breakdown of revenue by business segment for the periods indicated.

    Table 1 – Breakdown of Revenue by Business Segment







    Three Months Ended





    June 30, 2021



    June 30, 2022





    (In '000, except for %)

    RMB

    % of

    Revenue



    RMB

    US$

    % of

    Revenue



    % Change

    YOY

    Total Freight

    2,259,003

    73.0 %



    1,208,435

    180,415

    62.8 %



    (46.5 %)

      -Freight

    1,398,561

    45.2 %



    1,208,220

    180,383

    62.8 %



    (13.6 %)

      -Legacy UCargo

    860,442

    27.8 %



    215

    32

    0.0 %



    (100.0 %)

    Supply Chain

    Management

    479,555

    15.5 %



    450,984

    67,330

    23.4 %



    (6.0 %)

    Global

    314,602

    10.2 %



    241,171

    36,006

    12.5 %



    (23.3 %)

    Others(9)

    40,171

    1.3 %



    25,855

    3,860

    1.3 %



    (35.6 %)

    Total Revenue

    3,093,331

    100.0 %



    1,926,445

    287,611

    100.0 %



    (37.7 %)

    • Freight Service Revenue was RMB1,208.4 million (US$180.4 million) for the second quarter of 2022, compared with RMB2,259.0 million in the same period last year, of which, RMB0.2 million and RMB860.4 million were from the legacy UCargo business line. Freight service revenue, excluding the legacy UCargo business, decreased by 13.6% year over year, primarily resulting from an 8.8% decrease in freight volume and a 5.0% decrease in average selling price per tonne.
    • Supply Chain Management Service Revenue decreased by 6.0% year over year to RMB451.0 million (US$67.3 million) for the second quarter of 2022 from RMB479.6 million in the same period last year, primarily due to the restrictions on certain warehouses caused by the COVID-19 pandemic and the discontinuation of low-margin legacy accounts.
    • Global Service Revenue decreased by 23.3% year over year to RMB241.2 million (US$36.0 million) for the second quarter of 2022 from RMB314.6 million in the same period last year, primarily due to lower parcel volume, as the pandemic and related controls significantly impacted e-commerce businesses in SEA.

    Cost of Revenue

    The following table sets forth a breakdown of cost of revenue by business segment for the periods indicated.

    Table 2 – Breakdown of Cost of Revenue by Business Segment









    Three Months Ended



    % of Revenue

    Change

    YOY





    June 30, 2021



    June 30, 2022



    (In '000, except for %)



    RMB

    % of

    Revenue



    RMB

    US$

    % of

    Revenue



    Freight



    (2,208,103)

    97.7 %



    (1,302,523)

    (194,462)

    107.8 %



    10.1 %

    Supply Chain

    Management



    (436,530)

    91.0 %



    (413,910)

    (61,795)

    91.8 %



    0.8 %

    Global



    (328,597)

    104.4 %



    (276,554)

    (41,288)

    114.7 %



    10.3 %

    Others



    (33,876)

    84.3 %



    (27,273)

    (4,072)

    105.5 %



    21.2 %

    Total Cost of Revenue



    (3,007,106)

    97.2 %



    (2,020,260)

    (301,617)

    104.9 %



    7.7 %

    • Cost of Revenue for Freight was RMB1,302.5 million (US$194.5 million) or 107.8% of revenue in the second quarter of 2022. The 10.1% year-over-year increase in cost of revenue as a percentage of revenue was mainly due to higher fuel cost and additional costs caused by the COVID-19 pandemic.
    • Cost of Revenue for Supply Chain Management was RMB413.9 million (US$61.8 million) or 91.8% of revenue in the second quarter of 2022. The 0.8% year-over-year increase in cost of revenue as a percentage of revenue was primarily due to restrictions on certain warehouses caused by the pandemic.
    • Cost of Revenue for Global was RMB276.6 million (US$41.3 million) or 114.7% of revenue in the second quarter of 2022. The 10.3% year-over-year increase in cost of revenue as a percentage of revenue was primarily due to lower parcel volume. 
    • Cost of Revenue for Others was RMB 27.3 million (US$4.1 million) or 105.5% of revenue in the second quarter of 2022. The 21.2% year-over-year increase in cost of revenue as a percentage of revenue was primarily due to the winding-down of the BEST Capital business line.

    Gross Loss was RMB93.8 million (US$14.0 million) in the second quarter of 2022, compared to a gross profit of RMB86.2 million in the second quarter of 2021; Gross Margin was negative 4.9%, compared to positive 2.8% in the second quarter of 2021.

    Operating Expenses

    Selling, General and Administrative ("SG&A") Expenses were RMB326.2 million (US$48.7 million), or 16.9% of revenue, in the second quarter of 2022, compared to RMB262.3 million, or 8.5% of revenue, in the same quarter of 2021. The increase was primarily due to expenses associated with winding down the Capital business and one-time expenses related to the ADS ratio change.  Excluding these one off expenses, SG&A expenses in the second quarter decreased by 1.9% year over year.

    Research and Development Expenses were RMB42.1 million (US$6.3 million) or 2.2% of revenue in the second quarter of 2022, compared to RMB47.6 million or 1.5% of revenue in the second quarter of 2021, primarily due to reduced headcount and lower revenue.

    Share-based Compensation ("SBC") Expenses included in the cost and expense items above were RMB19.9 million (US$3.0 million) in the second quarter of 2022, compared to RMB30.0 million in the same period of 2021. Of the total SBC expenses, RMB0.1 million (US$0.02 million) was allocated to cost of revenue, RMB1.0 million (US$0.1 million) was allocated to selling expenses, RMB17.6 million (US$2.6 million) was allocated to general and administrative expenses, and RMB1.2 million (US$0.2 million) was allocated to research and development expenses.

    Net Loss and Non-GAAP Net Loss from continuing operations

    Net Loss from continuing operations in the second quarter of 2022 was RMB337.1 million (US$50.3 million), compared to RMB146.9 million in the same period of 2021. Excluding SBC expenses, amortization of intangible assets resulting from business acquisitions and gain from appreciation of investment, Non-GAAP Net Loss from continuing operations in the second quarter of 2022 was RMB317.2 million (US$47.4 million), compared to RMB116.9 million in the second quarter of 2021.

    Diluted loss per ADS and Non-GAAP diluted loss per ADS from continuing operations

    Diluted loss per ADS from continuing operations in the second quarter of 2022 was RMB3.88 (US$0.58), compared to a loss of RMB1.82 in the same period of 2021. Excluding SBC expenses, amortization of intangible assets resulting from business acquisitions and gain from appreciation of investment, Non-GAAP diluted loss per ADS from continuing operations in the second quarter of 2022 was RMB3.63 (US$0.54), compared to a loss of RMB1.43 in the second quarter of 2021. A reconciliation of non-GAAP diluted loss per ADS to diluted loss per ADS is included at the end of this results announcement.

    Adjusted EBITDA and Adjusted EBITDA Margin from continuing operations

    Adjusted EBITDA from continuing operations in the second quarter of 2022 was negative RMB267.3 million (US$39.9million), compared to negative RMB50.6 million in the same period of 2021. Adjusted EBITDA Margin from continuing operations in the second quarter of 2022 was negative 13.9%, compared to negative 1.6% in the same period of 2021.

    Cash and Cash Equivalents, Restricted Cash and Short-term Investments

    As of June 30, 2022, cash and cash equivalents, restricted cash and short-term investments were RMB4,413.0 million (US$658.9 million), compared to RMB2,935.4 million as of June 30, 2021. In June 2022, the Company bought back aggregate principal amount of US$94.8 million (RMB636.5 million) of its existing Convertible Senior Notes due 2024.

    Capital Expenditures ("CAPEX")

    CAPEX was RMB35.0 million (US$5.3 million) or 1.8% of total revenue in the second quarter of 2022, compared to CAPEX of RMB52.9 million or 1.7% of total revenue in the same period of 2021. 

    SHARES OUTSTANDING

    As of August 8, 2022, the Company had approximately 392.9 million ordinary shares outstanding(10). Each American Depositary Share represents five (5) Class A ordinary shares.

    FINANCIAL GUIDANCE

    Due to the uncertainties relating to the COVID-19 pandemic, the Company is not providing any financial guidance or revenue outlook at this time. We are driving each of our business units toward a speedy recovery as the COVID-19 pandemic eases.

    WEBCAST AND CONFERENCE CALL INFORMATION

    The Company will hold a conference call at 9:00 pm U.S. Eastern Time on August 17, 2022 (9:00 am Beijing Time on August 18, 2022), to discuss its financial results and operating performance for the second quarter of 2022.

    Participants may access the call by dialing the following numbers:

    United States:

    +1-888-317-6003

    Hong Kong:   

    800-963976 or +852-5808-1995

    Mainland China:

    4001-206115

    International: 

    +1-412-317-6061

    Participant Elite Entry Number:   

    3818072

     A replay of the conference call will be accessible through August 24, 2022 by dialing the following numbers:

    United States:                              

    +1-877-344-7529

    International:   

    +1-412-317-0088

    Replay Access Code:       

    8680053

    Please visit the Company's investor relations website to view the earnings release prior to the conference call. A live and archived webcast of the conference call and a corporate presentation will be available at the same site.

    ABOUT BEST INC.

    BEST Inc. (NYSE:BEST) is a leading integrated smart supply chain solutions and logistics services provider in China and SEA. Through its proprietary technology platform and extensive networks, BEST offers a comprehensive set of logistics and value-added services, including freight delivery, supply chain management and global logistics services. BEST's mission is to empower business and enrich life by leveraging technology and business model innovation to create a smarter, more efficient supply chain. For more information, please visit: http://www.best-inc.com/en/.  

    For investor and media inquiries, please contact:

    BEST Inc.

    Investor relations team                         

    [email protected]

    The Piacente Group, Inc.

    Yang Song

    Tel: +86-10-6508-0677

    E-mail: [email protected]

    The Piacente Group, Inc.

    Brandi Piacente

    Tel: +1-212-481-2050

    E-mail:  [email protected]

    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 business outlook and quotations from management in this announcement, as well as BEST's strategic and operational plans, contain forward-looking statements. BEST may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (the "SEC"), in its annual report 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 BEST's 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: BEST's goals and strategies; BEST's future business development, results of operations and financial condition; BEST's ability to maintain and enhance its ecosystem; BEST's ability to compete effectively; BEST's ability to continue to innovate, meet evolving market trends, adapt to changing customer demands and maintain its culture of innovation; fluctuations in general economic and business conditions in China and other countries in which BEST operates, and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in BEST's filings with the SEC. All information provided in this press release and in the attachments is as of the date of this press release, and BEST does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

    USE OF NON-GAAP FINANCIAL MEASURES

    In evaluating its business, BEST considers and uses non-GAAP measures, such as non-GAAP net loss/income, non-GAAP net loss/income margin, adjusted EBITDA, adjusted EBITDA margin, EBITDA, and non-GAAP Diluted earnings/loss per ADS, as supplemental measures in the evaluation of the Company's operating results and in the Company's financial and operational decision-making. The Company believes these non-GAAP financial measures that help identify underlying trends in the Company's business that could otherwise be distorted by the effect of the expenses and gains that the Company includes in loss from operations and net loss. The Company believes that these non-GAAP financial measures provide useful information about its operating results, enhance the overall understanding of its past performance and future prospects and allow for greater visibility with respect to key metrics used by the Company's management in its financial and operational decision-making. 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 Measures to the Nearest Comparable GAAP Measures" in the results announcement.

    The non-GAAP financial measures are provided as additional information to help investors compare business trends among different reporting periods on a consistent basis and to enhance investors' overall understanding of the Company's current financial performance and prospects for the future. These non-GAAP financial measures should be considered in addition to results prepared in accordance with U.S. GAAP, but should not be considered a substitute for, or superior to, U.S. GAAP results. In addition, the Company's calculation of the non-GAAP financial measures may be different from the calculation used by other companies, and therefore comparability may be limited.

     

     

     

    Summary of Unaudited Condensed Consolidated Income Statements

    (In Thousands)







    Three Months Ended June 30,



    Six Months Ended June 30,





    2021

    2022



    2021

    2022





    RMB

    RMB

    US$



    RMB

    RMB

    US$



    Revenue

















    Freight

    2,259,003

    1,208,435

    180,415



    4,302,189

    2,301,249

    343,567



    -Freight

    1,398,561

    1,208,220

    180,383



    2,573,054

    2,281,680

    340,645



    -Legacy UCargo

    860,442

    215

    32



    1,729,135

    19,569

    2,922



    Supply Chain Management

    479,555

    450,984

    67,330



    927,216

    859,946

    128,387



    Global

    314,602

    241,171

    36,006



    565,024

    509,880

    76,123



    Others

    40,171

    25,855

    3,860



    82,461

    57,955

    8,652



    Total Revenue

    3,093,331

    1,926,445

    287,611



    5,876,890

    3,729,030

    556,729



    Cost of Revenue

















    Freight

    (2,208,103)

    (1,302,523)

    (194,462)



    (4,238,055)

    (2,472,837)

    (369,185)



    Supply Chain Management

    (436,530)

    (413,910)

    (61,795)



    (860,036)

    (805,117)

    (120,201)



    Global

    (328,597)

    (276,554)

    (41,288)



    (593,699)

    (562,232)

    (83,939)



    Others

    (33,876)

    (27,273)

    (4,072)



    (47,183)

    (59,498)

    (8,883)



    Total Cost of Revenue

    (3,007,106)

    (2,020,260)

    (301,617)



    (5,738,973)

    (3,899,684)

    (582,208)



    Gross Profit/(Loss)

    86,225

    (93,815)

    (14,006)



    137,917

    (170,654)

    (25,479)



    Selling Expenses

    (64,790)

    (66,130)

    (9,873)



    (119,871)

    (121,056)

    (18,073)



     General and Administrative

        Expenses

    (197,541)

    (260,079(11)

    (38,829)



    (392,221)

    (460,133)

    (68,696)



    Research and Development

        Expenses

    (47,586)

    (42,127)

    (6,289)



    (87,651)

    (75,302)

    (11,242)



    Other operating income, net

    98,824

    116,975

    17,464



    140,542

    119,615

    17,858



    Loss from Operations

    (124,868)

    (345,176)

    (51,533)



    (321,284)

    (707,530)

    (105,632)



    Interest Income

    12,654

    25,554

    3,815



    24,361

    41,172

    6,147



    Interest Expense

    (38,005)

    (25,738)

    (3,843)



    (73,517)

    (52,160)

    (7,787)



    Foreign Exchange Loss

    (1,511)

    (107,265)

    (16,014)



    (711)

    (102,420)

    (15,291)



    Other Income

    5,525

    19,426

    2,900



    46,260

    21,108

    3,151



    Other Expense

    (3,247)

    20,422

    3,049



    (11,489)

    20,042

    2,992



    Gain on changes in the fair value

        of derivative assets/liabilities

    -

    75,757

    11,310



    -

    63,088

    9,419



    Loss before Income Tax and

        Share of Net Loss of Equity

        Investees

    (149,452)

    (337,020)

    (50,316)



    (336,380)

    (716,700)

    (107,001)



    Income Tax Expense/(Benefits)

    2,643

    (93)

    (14)



    (1,647)

    (312)

    (47)



    Loss before Share of Net loss

        of Equity Investees

    (146,809)

    (337,113)

    (50,330)



    (338,027)

    (717,012)

    (107,048)



    Share of Net Loss of Equity

        Investees

    (42)

    -

    -



    (42)

    -

    -



    Net Loss from continuing

        operations

    (146,851)

    (337,113)

    (50,330)



    (338,069)

    (717,012)

    (107,048)



    Net (loss)/income from

        discontinued operations

    (319,636)

    2,511

    375



    (746,723)

    2,227

    332



    Net Loss

    (466,487)

    (334,602)

    (49,955)



    (1,084,792)

    (714,785)

    (106,716)



    Net Loss from continuing

        operations attributable to non-

        controlling interests

    (5,519)

    (29,256)

    (4,368)



    (10,929)

    (50,134)

    (7,485)



    Net Loss attributable to BEST

         Inc.

    (460,968)

    (305,346)

    (45,587)



    (1,073,863)

    (664,651)

    (99,231)























     

     

     

    Summary of Unaudited Condensed Consolidated Balance Sheets

    (In Thousands)







    As of December 31,2021



    As of June 30, 2022



    RMB



    RMB

    US$

    Assets









    Current Assets









    Cash and Cash Equivalents

    3,571,745



    942,335

    140,687

    Restricted Cash

    675,159



    531,386

    79,334

    Accounts and Notes Receivables

    827,631



    816,393

    121,884

    Inventories

    25,622



    22,693

    3,388

    Prepayments and Other Current Assets

    1,172,472



    867,246

    129,479

    Short‑term Investments

    147,359



    1,613,776

    240,930

    Amounts Due from Related Parties

    125,198



    80,100

    11,959

    Lease Rental Receivables

    298,364



    149,309

    22,291

    Total Current Assets

    6,843,550



    5,023,238

    749,952

    Non‑current Assets









    Property and Equipment, Net

    762,642



    739,421

    110,393

    Intangible Assets, Net

    55,684



    65,147

    9,726

    Long‑term Investments

    219,171



    199,171

    29,735

    Goodwill

    54,135



    54,135

    8,082

    Non‑current Deposits

    92,866



    57,445

    8,576

    Other Non‑current Assets

    111,640



    74,927

    11,186

    Restricted Cash

    1,069,244



    1,325,545

    197,899

    Lease Rental Receivables

    235,429



    98,832

    14,755

    Operating Lease Right-of-use Assets

    1,899,522



    1,737,218

    259,360

    Total non‑current Assets

    4,500,333



    4,351,841

    649,712

    Total Assets

    11,343,883



    9,375,079

    1,399,664

    Liabilities and Shareholders' Equity









    Current Liabilities









    Long-term borrowings-current

    287,814



    168,038

    25,087

    Convertible Senior Notes held by related parties

    633,475



    1,676,479

    250,292

    Convertible Senior Notes held by third parties

    633,475



    34,575

    5,162

    Short‑term Bank Loans

    530,495



    295,470

    44,113

    Accounts and Notes Payable

    1,353,150



    1,500,630

    224,038

    Income Tax Payable

    587



    461

    69

    Customer Advances and Deposits and Deferred

        Revenue

    298,353



    270,169

    40,335

    Accrued Expenses and Other Liabilities

    1,591,639



    1,116,512

    166,691

    Financing Lease Liabilities

    1,851



    1,783

    266

    Operating Lease Liabilities

    518,248



    490,091

    73,169

    Amounts Due to Related Parties

    2,763



    2,810

    420

    Total Current Liabilities

    5,851,850



    5,557,018

    829,642















     

     

     

    Summary of Unaudited Condensed Consolidated Balance Sheets (Cont'd)

    (In Thousands)











    As of December 31, 2021



    As of June 30, 2022



    RMB



    RMB

    US$

    Non-current Liabilities









    Convertible senior notes held by

    related parties

    955,097



    -

    -

    Long-term borrowings

    67,080



    21,605

    3,226

    Operating Lease Liabilities

    1,456,843



    1,331,302

    198,758

    Financing Lease Liabilities

    2,121



    1,774

    265

    Other Non‑current Liabilities

    24,261



    27,844

    4,157

    Long-term Bank Loans

    769,767



    891,325

    133,071

    Total Non‑current Liabilities

    3,275,169



    2,273,850

    339,477

    Total Liabilities

    9,127,019



    7,830,868

    1,169,119

    Mezzanine Equity:









    Convertible Non-controlling Interests

    191,865



    191,865

    28,645

    Total mezzanine equity

    191,865



    191,865

    28,645

    Shareholders' Equity









    Ordinary Shares

    25,988



    25,988

    3,880

    Treasury Shares

    (113,031)



    (1,475)

    (220)

    Additional Paid‑In Capital

    19,522,173



    19,451,481

    2,904,030

    Statutory reserves

    167



    -

    -

    Accumulated Deficit

    (17,471,716)



    (18,169,385)(12)

    (2,712,618)

    Accumulated Other

        Comprehensive Income

    107,379



    107,834

    16,099

    BEST Inc. Shareholders' Equity

    2,070,960



    1,414,443

    211,171

    Non-controlling Interests

    (45,961)



    (62,097)

    (9,271)

    Total Shareholders' Equity

    2,024,999



    1,352,346

    201,900

    Total Liabilities, Mezzanine Equity

        and Shareholders' Equity

    11,343,883



    9,375,079

    1,399,664

     

     

     

    Summary of Unaudited Condensed Consolidated Statements of Cash Flows

     (In Thousands)







    Three Months Ended June 30,



    Six Months Ended June 30,



    2021



    2022



    2021



    2022



    RMB



    RMB

    US$



    RMB



    RMB

    US$

    Net cash used in continuing operating

        activities

    (193,898)



    (313,558)

    (46,811)



    (146,011)



    (617,654)

    (92,213)

    Net cash generated from/(used in)

        discontinued operating activities

    102,306



    -

    -



    (603,532)



    -

    -

    Net cash used in operating

        activities

    (91,592)



    (313,558)

    (46,811)



    (749,543)



    (617,654)

    (92,213)

    Net cash generated from/(used in)

        continuing
    investing activities

    443,819



    (100,994)

    (15,078)



    593,893



    (980,536)

    (146,390)

    Net cash used in discontinued

        Investing activities

    (118,462)



    -

    -



    (245,740)



    -

    -

    Net cash generated from/(used in)

        investing activities

    325,357



    (100,994)

    (15,078)



    348,153



    (980,536)

    (146,390)

    Net cash (used in)/generated from 

        continuing financing activities

    (118,894)



    (821,512)

    (122,649)



    155,206



    (966,796)

    (144,339)

    Net cash used in discontinued financing 

        activities

    (340,467)



    -

    -



    (513,120)



    -

    -

    Net cash used in financing activities

    (459,361)



    (821,512)

    (122,649)



    (357,914)



    (966,796)

    (144,339)

    Exchange Rate Effect on Cash and

        Cash Equivalents, and Restricted

        Cash

    (37,131)



    71,659

    10,698



    (30,415)



    48,104

    7,182

    Net decrease in Cash and Cash

        Equivalents, and Restricted Cash

    (262,727)



    (1,164,405)

    (173,840)



    (789,719)



    (2,516,882)

    (375,760)

    Cash and Cash Equivalents, and

        Restricted Cash at Beginning of 

        Period

    3,682,129



    3,963,671

    591,760



    4,209,121



    5,316,148

    793,680

    Cash and Cash Equivalents, and

        Restricted Cash at End of
     Period

    3,419,402



    2,799,266

    417,920



    3,419,402



    2,799,266

    417,920

    Less: Cash and Cash Equivalents,

        and Restricted Cash held for sales

        at end of the Period

    484,015



    -

    -



    484,015



    -

    -

    Cash and Cash Equivalents, and

        Restricted Cash from continuing

        operations at End of
     Period

    2,935,387



    2,799,266

    417,920



    2,935,387



    2,799,266

    417,920























     

    RECONCILIATIONS OF NON-GAAP MEASURES TO THE NEAREST COMPARABLE GAAP MEASURES

    For the Company's continuing operations, the table below sets forth a reconciliation of the Company's net (loss)/income to EBITDA, adjusted EBITDA and adjusted EBITDA margin for the periods indicated:

    Table 3 – Reconciliation of EBITDA, Adjusted EBITDA and Adjusted EBITDA Margin







    Three Months Ended June 30, 2022

    (In RMB'000)

    Freight

    Supply Chain

    Global

    Others

    Unallocated(13)

    Total

    Net (Loss)/Income

    (57,418)

    12,094

    (105,085)

    (79,409)

    (107,295)

    (337,113)

    Add













    Depreciation &

    Amortization

    20,188

    9,416

    5,977

    6,706

    7,315

    49,602

    Interest Expense

    -

    -

    -

    -

    25,738

    25,738

    Income Tax Expense

    -

    45

    12

    24

    12

    93

    Subtract













    Interest Income

    -

    -

    -

    -

    (25,554)

    (25,554)

    EBITDA

    (37,230)

    21,555

    (99,096)

    (72,679)

    (99,784)

    (287,234)

    Add













     Share-based

    Compensation

    Expenses

    2,777

    1,686

    1,415

    128

    13,934

    19,940

    Adjusted EBITDA

    (34,453)

    23,241

    (97,681)

    (72,551)

    (85,850)

    (267,294)

    Adjusted EBITDA

        Margin

    (2.9 %)

    5.2 %

    (40.5%)

    (280.6 %)

    -

    (13.9 %)

     



    Three Months Ended  June 30, 2021

    (In RMB'000)

    Freight

    Supply Chain

    Global

    Others       

    Unallocated        

    Total

    Net Income/(Loss)

    16,601

    10,027

    (55,271)

    (10,844)

    (107,364)

    (146,851)

    Add













    Depreciation &

    Amortization

    21,331

    9,812

    5,655

    399

    6,325

    43,522

    Interest Expense

    -

    -

    -

    -

    38,005

    38,005

    Income Tax Expense

    -

    215

    21

    (2,874)

    (5)

    (2,643)

    Subtract













    Interest Income

    -

    -

    -

    -

    (12,654)

    (12,654)

    EBITDA

    37,932

    20,054

    (49,595)

    (13,319)

    (75,693)

    (80,621)

    Add













     Share-based

    Compensation

    Expenses

    3,512

    2,328

    2,320

    167

    21,666

    29,993

    Adjusted EBITDA

    41,444

    22,382

    (47,275)

    (13,152)

    (54,027)

    (50,628)

    Adjusted EBITDA

        Margin

    1.8 %

    4.7 %

    (15.0 %)

    (32.7 %)

    -

    (1.6 %)

    For the Company's continuing operations, the table below sets forth a reconciliation of the Company's net (loss)/income to non-GAAP net Income/(loss), non-GAAP net Income/(loss) margin for the periods indicated:

    Table 4 – Reconciliation of Non-GAAP Net (Loss)/Income and Non-GAAP Net (Loss)/Income Margin







    Three Months Ended June 30, 2022

    (In RMB'000)

    Freight

    Supply Chain

    Global

    Others

    Unallocated

    Total

    Net (Loss)/Income

    (57,418)

    12,094

    (105,085)

    (79,409)

    (107,295)

    (337,113)

    Add













     Share-based

    Compensation

    Expenses

    2,777

    1,686

    1,415

    128

    13,934

    19,940

    Non-GAAP Net

        (Loss)
    /Income

    (54,641)

    13,780

    (103,670)

    (79,281)

    (93,361)

    (317,173)

    Non-GAAP Net

        (Loss)
    /Income 

        Margin

    (4.5 %)

    3.1 %

    (43.0 %)

    (306.6 %)

    -

    (16.5 %)

     



    Three Months  Ended June 30, 2021

    (In RMB'000)

    Freight

    Supply Chain

    Global         

    Others

    Unallocated  

    Total        

    Net Income/(Loss)

    16,601

    10,027

    (55,271)

    (10,844)

    (107,364)

    (146,851)

    Add













     Share-based

    Compensation

    Expenses

    3,512

    2,328

    2,320

    167

    21,666

    29,993

    Non-GAAP Net

       Income/(Loss)

    20,113

    12,355

    (52,951)

    (10,677)

    (85,698)

    (116,858)

    Non-GAAP Net

       Income/(Loss) 

       Margin

    0.9 %

    2.6 %

    (16.8 %)

    (26.6 %)

    -

    (3.8 %)

    For the Company's continuing operations, the table below sets forth a reconciliation of the Company's diluted loss per ADS to Non-GAAP diluted loss per ADS for the periods indicated:

    Table 5 – Reconciliation of diluted loss per ADS and Non-GAAP diluted loss per ADS





    Three Months Ended June 30,



    Six Months Ended June 30,



    2022



    2022

    (In '000)

    RMB

    US$



    RMB

    US$

    Net Loss Attributable to Ordinary Shareholders

    (307,857)

    (45,962)



    (666,878)

    (99,563)

    Add











    Share-based Compensation Expenses

    19,940

    2,977



    40,623

    6,064

    Non-GAAP Net Loss Attributable to Ordinary

        Shareholders

    (287,917)

    (42,985)



    (626,255)

    (93,499)

    Weighted Average Diluted Ordinary Shares

        Outstanding During the Quarter











    Diluted

    396,784,104

    396,784,104



    391,368,266

    391,368,266

    Diluted (Non-GAAP)

    396,784,104

    396,784,104



    391,368,266

    391,368,266

    Diluted loss per ordinary share

    (0.78)

    (0.12)



    (1.70)

    (0.25)

    Add











    Non-GAAP adjustment to net loss per

        ordinary share

    0.05

    0.01



    0.10

    0.01

    Non-GAAP diluted loss per ordinary share

    (0.73)

    (0.11)



    (1.60)

    (0.24)













    Diluted loss per ADS

    (3.88)

    (0.58)



    (8.52)

    (1.27)

    Add











    Non-GAAP adjustment to net loss per ADS

    0.25

    0.04



    0.52

    0.08

    Non-GAAP diluted loss per ADS

    (3.63)

    (0.54)



    (8.00)

    (1.19)

     

    (1) All numbers presented have been rounded to the nearest integer, tenth, or hundredth, and year over year comparisons are based on figures before rounding.        

    (2) In December 2021, BEST sold its China express business, the principal terms of which were previously announced. As a result, China express business has been deconsolidated from the Company and its historical financial results are reflected in the Company's consolidated financial statements as discontinued operations accordingly. The financial information and non-GAAP financial information disclosed in this press release is presented on a continuing operations basis, unless otherwise specifically stated.

    (3) Non-GAAP net income/loss represents net income/loss excluding share-based compensation expenses, amortization of intangible assets resulting from business acquisitions, and fair value change of equity investments (if any).

    (4) See the sections entitled "Use of Non-GAAP Financial Measures" and "Reconciliations of Non-GAAP Measures to the Nearest Comparable GAAP Measures" for more information about the non-GAAP measures referred to within this results announcement.

    (5) Diluted earnings/loss per ADS, is calculated by dividing net income/loss attributable to ordinary shareholders as adjusted for the effect of dilutive ordinary equivalent shares, if any, by the weighted average number of ordinary and dilutive ordinary equivalent shares expressed in ADS outstanding during the period.

    (6) EBITDA represents net income/loss excluding depreciation, amortization, interest expense and income tax expense and minus interest income. Adjusted EBITDA represents EBITDA excluding share-based compensation expenses and fair value change of equity investments (if any).

    (7) All numbers presented have been rounded to the nearest integer, tenth, or hundredth, and year over year comparisons are based on figures before rounding.      

    (8) All numbers represented the financial results from continuing operations, unless otherwise stated.     

    (9) "Others" Segment primarily represents Capital business unit. Results from UCargo's legacy contracts with external customers are now reported under "Freight" segment and prior period segment information were retrospectively revised to conform to current period presentation.         

    (10) The total number of shares outstanding excludes shares reserved for future issuances upon exercise or vesting of awards granted under the Company's share incentive plans.

    (11) Including additional expenses associated with winding down the Capital business line and one-time expenses associated with ADS ratio change of RMB77,677 in aggregate.

    (12) Including accumulated accretion to redemption value and deemed dividend in relation to redeemable convertible preferred shares of RMB9,493,807, and accumulated loss from operations of RMB8,675,578.

    (13) Unallocated expenses are primarily related to corporate administrative expenses and other miscellaneous items that are not allocated to individual segments.

     

     

     

    Cision View original content to download multimedia:https://www.prnewswire.com/news-releases/best-inc-announces-unaudited-second-quarter-2022-financial-results-301607514.html

    SOURCE BEST Inc.

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    The Company Plans to Reach Group Profitability by the End of 2023 HANGZHOU, China, May 30, 2023 /PRNewswire/ -- BEST Inc. (NYSE:BEST) ("BEST" or the "Company"), a leading integrated smart supply chain solutions and logistics services provider in China and Southeast Asia, today announced its unaudited financial results for the first quarter ended March 31, 2023. Johnny Chou, Founder, Chairman and CEO of BEST, commented, "We delivered exceptionally strong financial improvements in the first quarter of 2023 despite the traditionally slow first quarter and lingering impact from CO

    5/30/23 6:00:00 PM ET
    $BEST
    Trucking Freight/Courier Services
    Industrials