Vipshop Holdings Ltd · NYSE:VIPS
Vipshop — Q4 2019 Earnings Presentation
26 slides from Vipshop's earnings presentation, March 2020
Slide 1: Vipshop Holdings Limited Investor Presentation
Vipshop Holdings Limited Investor Presentation March 2020
Slide 2: Disclaimer
Disclaimer This presentation 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,” “fu
Slide 3: Vipshop: China's Leading Online Discount Retailer for Brands
Vipshop China's Leading Online Discount Retailer for Brands 3
Slide 4: China's huge market potential in online discount retail and B2C market
China’s huge market potential in online discount retail and B2C market China’s Online Shopping Market(1) China’s Online B2C Market (1) (RMB in billions) (RMB in billions) 7,214 5,906 4,650 10,800 3,660 2,594 9,100 768 1,263 1,980 7,500 6,100 2013 2014 2015 2016 2017e 2018e 2019e 2020e 4,700 China’s
Slide 5: Massive potential in China's discount retail market
Massive potential in China’s discount retail market China's offline discount retail is extremely underdeveloped U.S. China 24 square feet per capita(1) 2 square feet per capita(1) Poor offline retail infrastructure in China Top 20 retailers account Top 20 retailers account Fragmented retail market i
Slide 6: China: A more attractive market opportunity
China: A more attractive market opportunity U.S. China Mostly focused on high-end and luxury Broad universe of popular brands for mass Market positioning markets market Discount / outlet retail channels saturated for Offline channels Lack of well-developed discount / outlet mass market merchandise;
Slide 7: A unique player in China's e-Commerce landscape
A unique player in China’s e-Commerce landscape Large scalable platforms Marketplace General B2C Online discount retailer Partner with popular and well-known brands by selling their excess inventory at discounted prices Core competency in merchandising, logistics, and customer service 7
Slide 8: Highly engaged and loyal customer base
Highly engaged and loyal customer base High and stable rate of orders from Rapid increase of repeat customers(2) repeat customers (in millions) (in millions) 76.1% 69.0 85.2% 87.2% 71.3% 92.3% 93.9% 93.6% 95.1% 96.6% 97.6% 96.5% 97.2% 66.6% 67.1% 62.4% 566.3 79.7% 552.5 Repeat 60.5 customers Orders
Slide 9: Preferred discount channel for popular brands
Preferred discount channel for popular brands Brand partners growth over time(1) Clear industry leader(2) 18,407 17,097 Fast inventory monetization 2010 – 2019 growth by 45x 13,336 Minimal brand dilution 10,778 One-stop solution for brands 7,110 8,505 Professional team with deep brand know
Slide 10: Operational Expertise
Operational Expertise
Slide 11: Core competency in merchandising
Core competency in merchandising Brand selection Deep brand relationships Sales management capability 1 1,300+ Understanding 31,000+ brands Professional Merchandisers 2 of consumers Consumer insights 3 Deepening Customized marketing brand Business partnership intelligence system Sales events opt
Slide 12: Flash sale requires differentiated logistics system
Flash sale requires differentiated logistics system Additional capabilities on top of traditional B2C e-Commerce(1) Flash sale Traditional B2C e-Commerce Market positioning Short Long Sales process Fast Slow No. of SKUs handled Large Moderate Volume of throughput Large Small Reverse logistics Large
Slide 13: Highly customized and seamlessly integrated IT system for flash sales
Highly customized and seamlessly integrated IT system for flash sales Traf fic 12a m 10a 12p Time m m 12a m Support huge traffic spikes during peak hours Expanding and cross-regional warehouse management system CRM system Big data and business intelligence Merchant platform 13
Slide 14: High entry barriers in China's online discount retail market
High entry barriers 1 Economies of Scale 2 First Mover Advantage Vipshop has established a dominant leadership position in China’s online discount retail market 3 Business Model 4 Operational Expertise 14
Slide 15: Visionary management team with strong execution
Visionary management team with strong execution Eric Ya Shen Arthur Xiaobo Hong Donghao Yang Co-Founder, Chairman, CEO Co-Founder, Vice Chairman, COO Chief Financial Officer 20+ years of experience in 15+ years of experience in 14+ years of experience in consumer electronic products consumer electro
Slide 16: Financial Highlights
Financial Highlights
Slide 17: Solid growth
Solid growth Total orders (1) Total net revenue (in millions) (RMB in millions) 10% 566.3 92,994 29% 16% 84,524 437.4 72,912 31% 29% 24% 335.0 56,591 41% 40% 269.8 40,203 12% 64% 24% 74% 193.1 174.6 29,319 26,083 140.3 23,129 118.0 2014 2015 2016 2017 2018 2019 4Q18 4Q19 2014 2015 2016 2017 2018 201
Slide 18: Steady gross profit margin growth
SteadySteady gross profit margingrowth expansion Quarterly gross profit and gross margin (RMB in millions) 24.9% 24.9% 25.0% 24.9% 24.1% 24.3% 24.1% 24.4% 23.5% 23.2% 23.9% 22.9% 21.6% 22.0% 21.7% 20.4% 20.6% 20.4% 7,001 20.2% 22.4% 19.5% 5,240 5,384 5,089 4,467 4,356 4,009 4,044 4,234 3,694 3,860 3
Slide 19: Operating leverage in fulfillment expenses
Operating leverage in fulfillment expenses Fulfillment expenses (Non-GAAP)(1) (RMB in millions) 10.8% 2,161 2,126 2,084 9.3% 9.3% 9.5% 9.0% 8.9% 9.0% 2,029 8.8% 9.0% 9.8% 8.2% 8.5% 8.5% 8.6% 8.8% 1,876 1,741 9.3% 8.0% 1,742 7.9% 1,636 8.9% 1,624 1,656 1,714 8.6% 1,548 6.9% 1,418 1,257 1,142 1,072 1,
Slide 20: Operating leverage due to the economy of scale
Operating leverage due to the economy of scale Marketing expenses (Non-GAAP)(1) General and administrative expenses (Non-GAAP)(1) (RMB in millions) (RMB in millions) 5.7% 1667 5.3% 5.1% 4.9% 4.9% 1110 4.8% 1008 910 4.5%4.2% 4.3% 4.3% 942 4.2% 888 867 3.6% 770 3.6% 707 719 742 3.8% 710 3.0% 3.0% 2.9%
Slide 21: Sustainable net margin attributable to shareholders
Sustainable net margin attributable to shareholders Net margin attributable to shareholders (Non-GAAP)(1) (RMB in millions) 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1,931 1,203 1,063 970 888 914 799 816 741 728 678 673 62
Slide 22: Balance sheet highlights
Balance sheet highlights Balance Sheet Highlights (in RMB millions) September 30, 2019 December 31, 2019 Cash and Cash Equivalents, Restricted Cash, and Short 6,690 10,772 Term Investments Current Assets 17,993 23,028 Total Assets 42,383 48,583 Current Liabilities 19,476 23,926 Total Liabilities 21,
Slide 23: Growth Strategies
Growth Strategies
Slide 24: Our future growth strategy
Our future growth strategy Leverage merchandising capability to: 1) expand customer base; 2) increase market Enlarge customer share; 3) strengthen the Vipshop brand base Recommendation / personalization, reliable fulfillment service, Super VIP loyalty program, higher customer retention and repeat pu
Slide 25: Key investment highlights
Key investment highlights 1 Strong industry growth fundamentals 2 Market leadership position 3 Highly engaged and loyal customer base 4 Superior operational expertise 5 Strong management team consistently delivering superior results 25
Slide 26: THANK YOU!
THANK YOU!