Fang Announces First Quarter 2020 Unaudited Financial Results and Change in Board of Directors

    BEIJING, June 6, 2020 /PRNewswire/ -- Fang Holdings Limited (NYSE: SFUN) ("Fang" or the "Company"), a leading real estate Internet portal in China, today announced (i) its unaudited financial results for the first quarter ended March 31, 2020, and (ii) a change in board of directors (the "Board").

    First Quarter 2020 Highlights

    • Total revenues were $38.3 million, an increase of 9.4% from $35.0 million in the corresponding period of 2019.
    • Operating income from continuing operations was $2.7 million, compared to an operating loss from continuing operations of $11.8 million in the corresponding period of 2019. 
    • Net loss from continuing operations was $39.1 million, compared to a net income from continuing operations of $5.1 million in the corresponding period of 2019.

    "During the COVID-19 global pandemic, Fang achieved positive operating income in the first quarter of 2020," commented Mr. Jian Liu, CEO of Fang. "Our leads generation services remain a strong growth contributor to our core business. For the coming quarters we look forward to continuing our focus on new initiatives such as live broadcastings, online exhibitions and VR livestreams to better service our customers."

    First Quarter 2020 Financial Results

    Revenues

    Fang reported total revenues of $38.3 million in the first quarter of 2020, an increase of 9.4% from $35.0 million in the corresponding period of 2019.

    • Revenue from marketing services was $17.3 million in the first quarter of 2020, an increase of 30.3% from $13.3 million in the corresponding period of 2019, mainly due to the increase in aggregate market demand.
    • Revenue from listing services was $10.2 million in the first quarter of 2020, a decrease of 16.0% from $12.2 million in the corresponding period of 2019, mainly due to the decrease in the number of paying customers.
    • Revenue from leads generation services was $7.5 million in the first quarter of 2020, an increase of 88.6% from $4.0 million in the corresponding period of 2019, mainly due to an increased acceptance and popularity of our leads generation services.
    • Revenue from financial services was $1.7 million in the first quarter of 2020, a decrease of 50.7% from $3.5 million in the corresponding period of 2019, mainly due to the decrease in average loan receivable balance.

    Cost of Revenue

    Cost of revenue was $5.4 million in the first quarter of 2020, a decrease of 35.9% from $8.4 million in the corresponding period of 2019, primarily due to the decline in sales and the optimization in cost structure.

    Operating Expenses

    Operating expenses were $32.1 million in the first quarter of 2020, a decrease of 17.0% from $38.7 million in the corresponding period of 2019.

    • Selling expenses were $13.6 million in the first quarter of 2020, a decrease of 16.9% from $16.3 million in the corresponding period of 2019, mainly due to the decrease in staff related costs.
    • General and administrative expenses were $18.6 million in the first quarter of 2020, a decrease of 17.1% from $22.4 million in the corresponding period of 2019, mainly due to the decrease in staff related costs.

    Operating Income/(Loss) from Continuing Operations

    Operating income from continuing operations was $2.7 million in the first quarter of 2020, compared to operating loss from continuing operations of $11.8 million in the corresponding period of 2019.

    Change in Fair Value of Securities

    Change in fair value of securities for the first quarter of 2020 was a loss of $42.6 million, compared to a gain of $32.0 million in the corresponding period of 2019, mainly due to the fluctuation in market price of investments in equity securities.

    Income Tax Benefits/Expenses

    Income tax benefits were $2.5 million in the first quarter of 2020, compared to an expense of $11.1 million in the corresponding period of 2019.

    Net (Loss)/income from continuing operations

    Net loss from continuing operations was $39.1 million in the first quarter of 2020, compared to a net income from continuing operations of $5.1 million in the corresponding period of 2019.

    Business Outlook

    Based on current operations and market conditions, Fang's management predicts a positive net income for the year of 2020, which represents management's current and preliminary view and is subject to change.

    Recent Developments

    Change in Board of Directors

    Ms. Hong Qin, an independent director of the Board, has resigned from the Board for personal reason, effective from June 5, 2020. Ms. Qin's resignation did not result from any disagreement with the Company on any matter relating to the Company's operations, policies or practices. Fang thanks Ms. Qin for her efforts and contributions to the Company.

    Fang has appointed Mr. Charles Changming Yan as an independent director of the Board, a member of the audit committee and the compensation committee of the Board, and a member and the chair of the nominating and corporate governance committee of the Board, effective from June 5, 2020. Upon the effectiveness of Ms. Qin's resignation and Mr. Yan's appointment, the Board will consist of five directors, including three independent directors.

    Mr. Yan founded Cada Resource International Limited, a company engaged in high-tech development and mineral resource industry, and has been its president since 1996. Mr.Yan also serves as the President of Tsinghua University Alumni Association (Hong Kong). He was the vice chairman of the Western Returned Scholars Association of China from 2008 to 2013. Mr.Yan had been awarded as one of the top ten overseas returned entrepreneurs in China in 2002. Mr. Yan received a bachelor's degree and a master's degree from Tsinghua University in engineering and a master's degree from University of Ottawa in engineering. 

    Conference Call Information

    Fang's management team will host a conference call on the same day at 8:00 AM U.S. ET (8:00 PM Beijing/Hong Kong time). The dial-in details for the live conference call are:

    International Toll:

    +65 67135600

    Toll-Free/Local Toll:


    United States

    +1 877-440-9253 / +1 631-460-7472

    Hong Kong

    +852 800-906-603 / +852 3018-6773

    Mainland China

    +86 800-870-0075 / +86 400-120-0948

    Direct Event Passcode

    1383200#

    Please register in advance of the conference using the link provided below. Upon registering, you will be provided with participant dial-in numbers, Direct Event passcode (1383200#) and unique registrant ID. Get prompted 10 min prior to the start of the conference. Enter the Direct Event Passcode above (1383200#), and your unique Registrant ID, followed by the pound or hash (#) sign to get into the call.

    Direct Event online registration: http://apac.directeventreg.com/registration/event/6379533 

    A telephone replay of the call will be available after the conclusion of the conference call from 11:00 AM ET on June 4, 2020 through 9:59 AM ET June 12, 2020. The dial-in details for the telephone replay are:

    International Toll:

    +61 2-8199-0299

    Toll-Free/Local Toll:


    United States

    +1 855-452-5696 / +1 646-254-3697

    Hong Kong

    +852 800-963-117 / +852 3051-2780

    Mainland China

    +86 400-602-2065 / +86 800-870-0206

    Conference ID:

    6379533

    A live and archived webcast of the conference call will be available on Fang's website at http://ir.fang.com.

    About Fang

    Fang operates a leading real estate Internet portal in China in terms of the number of page views and visitors to its websites. Through its websites, Fang provides primarily marketing, listing, leads generation and financial services for China's fast-growing real estate and home furnishing and improvement sectors. Its user-friendly websites support active online communities and networks of users seeking information on, and other value-added services for, the real estate and home furnishing and improvement sectors in China. Fang currently maintains approximately 74 offices to focus on local market needs and its website and database contains real estate related content covering 665 cities in China. For more information about Fang, please visit http://ir.fang.com.

    Safe Harbor Statements

    This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking 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," "is expected to," "anticipates," "aim," "future," "intends," "plans," "believes," "are likely to," "estimates," "may," "should" and similar expressions, and include, without limitation, statements regarding Fang's future financial performance, revenue guidance, growth and growth rates, market position and continued business transformation. Such statements are based upon management's current expectations and current market and operating conditions, and relate to events that involve known or unknown risks, uncertainties and other factors, all of which are difficult to predict and many of which are beyond Fang's control, which may cause its actual results, performance or achievements to differ materially from those in the forward-looking statements. Potential risks and uncertainties include, without limitation, the impact of Fang's business development strategies, the impact of the COVID-19 pandemic, and the impact of current and future government policies affecting China's real estate market. Further information regarding these and other risks, uncertainties or factors is included in Fang's filings with the U.S. Securities and Exchange Commission. Fang does not undertake any obligation to update any forward-looking statement as a result of new information, future events or otherwise, except as required under law.

     

     

    Fang Holdings Limited

    Unaudited Condensed Consolidated Balance Sheets

    (in thousands of U.S. dollars, except share data and per share data)


    ASSETS

    March 31,

    December 31,




    2020

    2019


    Current assets:





    Cash and cash equivalents

    107,018

    105,282



    Restricted cash, current

    215,599

    219,096



    Short-term investments

    181,303

    194,720



    Accounts receivable, net

    75,379

    66,379



    Funds receivable

    4,460

    8,372



    Prepayment and other current assets

    37,409

    31,509



    Commitment deposits

    185

    188



    Loans receivable, current

    60,922

    60,490



    Amounts due from related parties

    412

    644


    Total current assets 

    682,687

    686,680


    Non-current assets:





    Property and equipment, net

    629,969

    644,726



    Land use rights

    50,731

    50,731



    Deferred tax assets

    12,109

    6,570



    Deposits for non-current assets

    482

    618



    Restricted cash, non-current portion

    41,409

    42,452



    Long-term investments

    296,003

    341,946



    Other non-current assets

    38,610

    39,179


    Total non-current assets

    1,069,313

    1,126,222


    Total assets

    1,752,000

    1,812,902







    LIABILITIES AND SHAREHOLDERS' EQUITY




    Current liabilities:





    Short-term bank borrowings

    263,045

    264,624



    Bond payable-short term

    101,777

    102,779



    Deferred revenue

    140,690

    134,143



    Accrued expenses and other liabilities

    111,693

    120,244



    Customers' refundable fees

    7,755

    4,981



    Income tax payable

    4,272

    4,207



    Amounts due to related parties

    9,215

    9,227


    Total current liabilities

    638,447

    640,205


    Non-current liabilities:





    Long-term bank borrowings

    175,881

    184,158



    Convertible senior notes

    168,773

    168,929



    Deferred tax liabilities

    89,253

    90,723



    Other non-current liabilities

    138,179

    138,435







    Total non-current liabilities

    572,086

    582,245


    Total Liabilities  

    1,210,533

    1,222,450







    Equity:





    Class A ordinary shares, par value Hong Kong Dollar ("HK$") 1 per share,
    600,000,000 shares authorized for Class A and Class B in aggregate, issued
    shares as of December 31, 2019 and March 31, 2020: 71,775,686 and
    71,775,686; outstanding shares as of December 31, 2019 and March 31,
    2020: 65,403,527 and 65,403,527

    9,244

    9,244



    Class B ordinary shares, par value HK$1 per share, 600,000,000 shares
    authorized for Class A and Class B in aggregate, and 24,336,650 shares and
    24,336,650 shares issued and outstanding as at December 31, 2019 and March
    31, 2020, respectively

    3,124

    3,124



    Treasury stock

    -123,216

    -123,216



    Additional paid-in capital

    534,100

    528,620



    Accumulated other comprehensive loss

    -113,760

    -98,371



    Retained earnings

    231,283

    270,358


    Total Fang Holdings Limited shareholders' equity

    540,775

    589,759



    Non controlling interests

    692

    693


    Total equity

    541,467

    590,452


    TOTAL LIABILITIES AND EQUITY

    1,752,000

    1,812,902


     

     

    Unaudited Condensed Consolidated Statements of Comprehensive Income[1]

    (in thousands of U.S. dollars, except share data and per share data)







     Three months ended




     March 31,

     March 31,




    2020

    2019







    Revenues:





    Marketing services

    17,288

    13,263



    Listing services

    10,216

    12,159



    Leads generation services

    7,518

    3,986



    Value-added services

    1,416

    1,002



    Financial services

    1,726

    3,499



    E-commerce services

    109

    1,081


    Total revenues

    38,273

    34,990







    Cost of revenues:





    Cost of services

    -5,407

    -8,438


    Total cost of revenues

    -5,407

    -8,438







    Gross profit

    32,866

    26,552







    Operating expenses and income:




    Selling expenses

    -13,561

    -16,319



    General and administrative expenses

    -18,556

    -22,393



    Other income

    1,914

    387







    Operating income/(loss) from continuing operations

    2,663

    -11,773



    Foreign exchange gain/(loss)

    1,716

    -262



    Interest income

    3,923

    1,689



    Interest expense

    -8,461

    -6,045



    Investment income, net

    822

    5



    Realized gain on sale of available-for-sale securities

    -

    298



    Change in fair value of securities

    -42,634

    32,049



    Government grants

    369

    235



    Other non-operating loss

    -

    -


    Income (Loss) before income taxes and noncontrolling interests from continuing
    operations

    -41,602

    16,196



    Income tax benefits





    Income tax benefits

    2,527

    -11,119


    Net income from continuing operations, net of income taxes

    -39,075

    5,077



    Income from discontinued operations, net of income taxes

    -

    8,323


    Net (loss)/income

    -39,075

    13,400



    Net income attributable to noncontrolling interests

    -

    -


    Net income attributable to Fang Holdings Limited shareholders




    -39,075

    13,400


    Earnings per share for Class A and Class B ordinary shares and per ADS:



     Basic

    -0.41

    0.15



     Diluted

    -0.41

    0.14


     Earnings from continuing operations per share for Class A and Class B ordinary shares and per ADS:




     Basic

    -0.41

    0.06



     Diluted

    -0.41

    0.05


     Earnings from discontinued operations per share for Class A and Class B ordinary shares and per ADS:




     Basic

    -

    0.09



     Diluted

    -

    0.09


    ________________________

    [1] Impact of the Separation of China Index Holdings Ltd (NASDAQ: CIH) ("CIH") on the Company's Financial Statements: The separation of CIH represents a strategic shift of Fang and has a major effect on Fang's results of operations, the business operated by CIH has been reclassified as discontinued operations. For the periods presented in this press release, the assets and liabilities of the discontinued operations are presented separately on the consolidated balance sheets, and the results of the discontinued operations, less applicable income taxes, are reported as a separate component of income, which is income from discontinued operations, on the consolidated statements of comprehensive income (loss).

     

    Related Links :

    http://www.fang.com

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