China’s smart supply chain solutions and logistics services provider Best Inc., which serves e-commerce platforms TMall among others, disclosed that it made a net loss of RMB 233.4 million (USD 4.8 million) in the first quarter of 2019, even though its share in the country’s express delivery market increased to 11% from 9.6% at the end of March last year.
However, losses are declining, said the company’s chairman and CEO Johnny Chou. Losses were down 31.3% year-on-year.
He predicted that the company would become profitable within this year. It delivered revenue of RMB 6.9 billion for the quarter, up 37.4% year-on-year. Gross profit increased by 167.3% year-on-year to RMB 293 million.
Although Best was unprofitable between 2014 and 2018, its net loss has been narrowing since 2017 when it went public in the United States. Net loss for the company was RMB 718.5 million in 2014, RMB 1.06 billion in 2015 and RMB 1.36 billion in 2016. Its net loss decreased to RMB 1.23 billion in 2017. By 2018, net loss was at RMB 508,4 million.
Alibaba, which participated in several rounds of Best’s equity financing, owned 46% of the aggregate voting power of Best‘s issued and outstanding share capital at the end of February, just slightly less than Johnny Chou’s 46.4%, according to Best’s annual report.
The logistics firm confirmed in this report that a significant portion of its revenue is derived from a number of major e-commerce platforms in China, such as Taobao Marketplace and Tmall.
Contact the writer at [email protected]
Editor: Nadine Freischlad