UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 6-K

 

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 UNDER

THE SECURITIES EXCHANGE ACT OF 1934

 

For the month of March 2019

 

 

 

Commission File Number: 001-35147

 

 

 

Renren Inc.

 

5/F, North Wing

18 Jiuxianqiao Middle Road

Chaoyang District, Beijing 100016

People’s Republic of China

+86 (10) 8448-1818

 

(Address of principal executive offices)

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

 

Form 20-F x  Form 40-F ¨

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):________________

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):________________

 

 

 

 

 

 

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

  Renren Inc.  
       
    /s/ Thomas Jintao Ren  
  Name: Thomas Jintao Ren  
  Title: Chief Financial Officer  
       
Date: March 29, 2019      

 

 

 

 

Exhibit Index

 

Exhibit 99.1—Press Release

 

 

 

 

 

Exhibit 99.1

 

 

Renren Announces Unaudited Third Quarter 2018 Financial Results

 

BEIJING, China, March 29, 2019 — Renren Inc. (NYSE: RENN) ("Renren" or the "Company"), which operates a used auto business and SaaS business, today announced its unaudited financial results for the third quarter ended September 30, 2018.

 

Third Quarter 2018 Highlights

 

Total net revenues were US$116.8 million, a 94.1% increase from the corresponding period in 2017.

Used auto sales revenue was US$106.3 million, a 152% increase from the corresponding period in 2017.
Internet Value-Added Services (IVAS) and others net revenues were US$10.5 million, a 7.4% decrease from the corresponding period in 2017.

 

Operating loss was US$44.1 million, compared to an operating loss of US$27.2 million in the corresponding period in 2017.

 

Net loss attributable to the Company was US$28.8 million, compared to a net loss of US$22.8 million in the corresponding period in 2017.

 

Adjusted loss from continuing operations (1) (non-GAAP) was US$41.1 million, compared with an adjusted loss from continuing operations of US$14.9 million in the corresponding period in 2017.

 

Adjusted net loss (1) (non-GAAP) was US$44.0 million, compared to an adjusted net loss of US$10.5 million in the corresponding period in 2017.

 

(1)Adjusted loss from continuing operations and net income (loss) are non-GAAP measures, which are defined as loss from operations excluding share-based compensation expenses and amortization of intangible assets and net income (loss) excluding share-based compensation expenses, fair value change of contingent consideration and amortization of intangible assets, respectively. See “About Non-GAAP Financial Measures” below.

 

Third Quarter 2018 Results

 

Total net revenues for the third quarter of 2018 were US$116.8 million, representing a 94.1% increase from the corresponding period in 2017, due to the rapid growth of our used auto retail business since its launch in the second quarter of 2017.

 

Used auto sales revenues for the third quarter of 2018 were US$106.3 million, representing a 152% increase from the corresponding period in 2017. This is a new business that we initiated in the second quarter of 2017.

 

IVAS and others net revenues were US$10.5 million, representing a 7.4% decrease from the corresponding period of 2017. The decrease was mainly due to decreases in the revenue from both our Renren mobile live streaming service and our SaaS business.

 

Financing income was US$28 thousand for the third quarter of 2018, compared to US$6.6 million in the corresponding period of 2017. Our used auto dealership financing business ceased to extend financing to third parties from January 2018, and instead has focused on internal financing to our own used car dealerships since that time.

 

 

 

 

Cost of revenues was US$119.6 million, compared to US$54.6 million from the corresponding period of 2017. The increase was primarily due to the growth of our used auto sales business, as well as to US$5.7 million in write-offs of inventory we recorded in the third quarter of 2018. These write-offs were due to one of our dealerships having received a notice from a local police station regarding an investigation of the dealership premises in August 2018, which caused certain inventory not to be assessable pursuant to the investigation.

        

Operating expenses were US$41.4 million, a 26.4% increase from the corresponding period of 2017.

 

Selling and marketing expenses were US$9.5 million, a 23.5% increase from the corresponding period of 2017. The increase was primarily due to the increase in headcount and personnel-related expenses for the used auto sales business.  

 

Research and development expenses were US$7.3 million, a 15.7% increase from the corresponding period in 2017. The increase was primarily due to an increase in headcount and personnel-related expenses for the SaaS business.

 

General and administrative expenses were US$24.6 million, a 31.2% increase from the corresponding period in 2017. The increase was primarily due to an increase in US$16.1 million write-offs of advance to suppliers. Our management decided to record impairment loss for advance to suppliers because certain suppliers could not fulfill their contractual obligations to us.

 

Share-based compensation expenses, which were all included in operating expenses, were US$2.9 million, compared to US$12.2 million in the corresponding period in 2017. The decrease was mainly due to a modification which repriced the exercise price with respect to outstanding share incentive options in the third quarter of 2017.

 

Loss from operations was US$44.1 million, compared to a loss from operations of US$27.2 million in the corresponding period in 2017.

 

Loss in equity method investments was US$0.7 million, compared to loss of US$1.3 million in the corresponding period in 2017. We disposed of the overwhelming majority of our equity method investments in June 2018.

 

Net loss attributable to the Company was US$28.8 million, compared to a net loss of US$22.8 million in the corresponding period in 2017.

 

Adjusted loss from continuing operations (non-GAAP) was US$41.1 million, compared with an adjusted income from continuing operations of US$14.9 million in the corresponding period in 2017. Adjusted loss from operations is defined as loss from operations excluding share-based compensation expenses and amortization of intangible assets.

 

Adjusted net loss (non-GAAP) was US$44.0 million, compared to an adjusted net loss of US$10.5 million in the corresponding period in 2017. Adjusted net income (loss) is defined as net income (loss) excluding share-based compensation expenses, fair value change of contingent consideration and amortization of intangible assets.

 

 

 

  

Other Information

 

Legal proceedings

 

In August 2018, a notice from the Shandong Luokou police bureau was placed at the location of the Ji’nan Dealership, one of dealerships of the Company. This notice stated that there is an ongoing investigation concerning the Ji'nan dealership premise, and relevant persons were required to cooperate with the investigation. According to the Company's assessment, the investigation is concerning an individual who holds 30% of Ji’nan Dealership’s equity interest, not the Ji’nan Dealership. However, because the Ji’nan Dealership and its 30% minority shareholder, US$5.7 million inventory was written off and US$16.1 million write offs of advances to suppliers of the Ji’nan Dealership was recorded for the quarter ended September 30, 2018.

 

Business Outlook

 

The Company expects to generate revenues in an amount ranging from US$117 million to US$122 million in the fourth quarter of 2018, representing a 30.0% to 35.6% year-over-year increase. This forecast reflects the Company’s current and preliminary view, which is subject to change.

 

Conference Call Information

 

The Company will not host a conference call. Please contact our Investor Relations Department if you have any questions.

 

About Renren Inc.

 

Renren Inc. (NYSE: RENN) operates a used auto business and SaaS business. Renren's American depositary shares, each of which represents fifteen Class A ordinary shares, trade on NYSE under the symbol "RENN".

 

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 for the fourth quarter of 2018 and quotations from management in this announcement, as well as Renren's strategic and operational plans, contain forward-looking statements. Renren may also make written or oral forward-looking statements in its filings with the U.S. Securities and Exchange Commission ("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 Renren'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: our goals and strategies; our future business development, financial condition and results of operations; the expected growth of the social networking site market in China; our expectations regarding demand for and market acceptance of our services; our expectations regarding the retention and strengthening of our relationships with used auto dealerships; our plans to enhance user experience, infrastructure and service offerings; competition in our industry in China; and relevant government policies and regulations relating to our industry. Further information regarding these and other risks is included in our annual report on Form 20-F and other documents filed with the SEC. All information provided in this press release and in the attachments is as of the date of this press release, and Renren does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

 

 

 

  

About Non-GAAP Financial Measures

 

To supplement Renren's consolidated financial results presented in accordance with United States Generally Accepted Accounting Principles ("GAAP"), Renren uses "adjusted income (loss) from operations" and "net income (loss)" which are defined as non-GAAP financial measures by the SEC, in evaluating its business. We define adjusted income (loss) from operations as income (loss) from operations excluding share-based compensation expenses and amortization of intangible assets and adjusted net income (loss) as net income (loss) excluding share-based compensation expenses, fair value change of contingent consideration and amortization of intangible assets, respectively. Renren continuously and periodically reviews the operating results and business performance from operational perspectives. Starting from the first quarter of 2018, there was a significant impact on net income (loss) due to the material and significant noncash amount of fair value change of contingent consideration relating to the used auto dealerships of the emerging used auto business. Due to the nature of the business, Renren believes that including adjusted income (loss) from operations and excluding the impact of such fair value changes more appropriately reflects Renren’s results of operations, and provides investors with a better understanding of Renren’s business performance. To facilitate investors and analysts, we present the foresaid impact in "Reconciliation of non-GAAP results of operations measures to the comparable GAAP financial measures" retrospectively. We present adjusted income (loss) from operations and net income (loss) because they are used by our management to evaluate our operating performance. We also believe that these non-GAAP financial measures provide useful information to investors and others in understanding and evaluating our consolidated results of operations in the same manner as our management and in comparing financial results across accounting periods and to those of our peer companies.

 

These non-GAAP financial measures are not intended to be considered in isolation from, or as a substitute for, the financial information prepared and presented in accordance with GAAP. For more information on these non-GAAP financial measures, please see the table captioned "Reconciliation of non-GAAP results of operations measures to the comparable GAAP financial measures" at the end of this release.

 

 

For more information, please contact:

 

Cynthia Liu

Investor Relations Department

Renren Inc.

Tel: (86 10) 8448 1818 ext. 1300

Email: ir@renren-inc.com

 

 

 

 

RENREN INC.

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(In thousands of US dollars)

 

   December 31,   September 30, 
   2017   2018 
         
 ASSETS          
 Current assets:          
 Cash and cash equivalents  $125,199   $20,866 
 Restricted cash   47,253    5,824 
 Accounts receivable, net   6,098    1,997 
 Financing receivable, net   125,478    4,396 
 Prepaid expenses and other current assets   48,226    47,541 
 Amounts due from related parties   188    781 
 Inventory, net   95,012    59,918 
 Assets of discontinued operations   20,551    - 
 Total current assets   468,005    141,323 
           
 Non-current assets:          
 Long-term financing receivable, net   8    - 
 Property and equipment, net   29,516    1,787 
 Goodwill and intangible assets, net   104,197    120,037 
 Long-term investments   34,742    24,936 
 Non-current amount due from a related party   -    92,040 
 Other non-current assets   27,033    33,019 
 Non-current assets of discontinued operations   530,663    - 
 Total non-current assets   726,159    271,819 
 TOTAL ASSETS  $1,194,164   $413,142 
           
 LIABILITIES AND EQUITY          
 Current liabilities:          
 Accounts payable  $19,095   $7,850 
 Short-term debt   61,479    49,942 
 Accrued expenses and other current liabilities   31,877    27,893 
 Payable to investors   142,689    3 
 Amounts due to related parties   7,059    44 
 Deferred revenue and advance from customers   11,433    5,143 
 Income tax payable   11,727    13,186 
 Contingent consideration   5,944    7,905 
 Liabilities of discontinued operations   79,244    - 
 Total current liabilities   370,547    111,966 
           
 Non-current liabilities:          
 Long-term debt   47,665    33,000 
 Long-term contingent consideration   60,850    57,775 
 Non-liabilities of discontinued operations   6,356    - 
 Total non-current liabilities   114,871    90,775 
 TOTAL LIABILITIES  $485,418   $202,741 
           
 Shareholders' Equity:          
 Class A ordinary shares   727    734 
 Class B ordinary shares   305    305 
 Additional paid-in capital   1,303,117    706,304 
 Statutory reserves   6,712    6,712 
 Accumulated deficit   (653,173)   (540,468)
 Accumulated other comprehensive income (loss)   17,116    (5,910)
 Total Renren Inc. shareholders' equity   674,804    167,677 
 Noncontrolling interests   33,942    42,724 
 TOTAL EQUITY   708,746    210,401 
 TOTAL LIABILITIES AND EQUITY  $1,194,164   $413,142 

 

 

 

 

RENREN INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

(In thousands of US dollars, except share data and per share data, ADS data, and per ADS data)

 

   For the Three Months Ended 
   September 30,   June 30,   September 30, 
   2017   2018   2018 
 Net revenues:               
 Used car sales  $42,245   $122,728   $106,338 
 IVAS and others   11,321    12,085    10,478 
 Financing income   6,630    224    28 
 Total net revenues   60,196    135,037    116,844 
 Cost of revenues   (54,597)   (129,605)   (119,561)
 Gross profit   5,599    5,432    (2,717)
 Operating expenses:               
 Selling and marketing   (7,717)   (9,916)   (9,532)
 Research and development   (6,285)   (6,830)   (7,273)
 General and administrative   (18,775)   (21,292)   (24,625)
 Total operating expenses   (32,777)   (38,038)   (41,430)
 Loss from operations   (27,178)   (32,606)   (44,147)
                
 Other income   3,931    30,815    17,144 
 Interest income   718    411    2,387 
 Interest expenses   (1,282)   (900)   (1,861)
 Realized loss on short-term investments   1    -    - 
 Realized gain(loss) on disposal of long-term investments   32,726    -    (2,209)
 Total non-operating income   36,094    30,326    15,461 
                
 Income (loss) before provision of income tax and loss in equity method investments, net of tax   8,916    (2,280)   (28,686)
 Income tax expenses   (1,075)   (116)   (1,096)
 Income (loss) before loss in equity method investments, net of tax   7,841    (2,396)   (29,782)
  Loss in equity method investments, net of tax   (1,317)   (621)   (692)
 Income (loss) from continuing operations   6,524    (3,017)   (30,474)
                
 Discontinued operation:               
 Loss from operations of discontinued operations, net of income tax   (29,464)   (11,793)   - 
 Gain on deconsolidation of the subsidiaries, net of income tax   -    180,829    1,612 
 (Loss) income from discontinued operations, net of tax   (29,464)   169,036    1,612 
 Net (loss) income   (22,940)   166,019    (28,862)
 Net loss attributable to noncontrolling interests   175    100    102 
 Net (loss) income attributable to Renren Inc.  $(22,765)  $166,119   $(28,760)
                
 Net (loss) income per share from discontinued operations attributable to Renren Inc.shareholders:               
 Basic  $(0.03)  $0.16   $0.00 
 Diluted  $(0.03)  $0.15   $0.00 
                
 Net (loss) income per share attributable to Renren Inc. shareholders:               
 Basic  $(0.02)  $0.16   $(0.03)
 Diluted  $(0.02)  $0.15   $(0.03)
 Net (loss) income  attributable to Renren Inc. shareholders per ADS*:               
 Basic  $(0.33)  $2.41   $(0.42)
 Diluted  $(0.33)  $2.21   $(0.42)
                
 Weighted average number of shares used in calculating net (loss) income per ordinary share attributable to Renren Inc. shareholders:               
 Basic   1,029,120,470    1,035,143,003    1,036,609,262 
 Diluted   1,029,120,470    1,130,285,008    1,036,609,262 
 Weighted average number of shares used in calculating net (loss) income per ordinary share from discontinued operations attributable to Renren Inc. shareholders:               
 Basic   1,029,120,470    1,035,143,003    1,036,609,262 
 Diluted   1,029,120,470    1,130,285,008    1,116,051,687 

 

*Each ADS represents 15 Class A ordinary shares.

 

 

 

 

Reconciliation of Non-GAAP results of operations measures to the comparable GAAP financial measures

(In thousands of US dollars)

 

   For the Three Months Ended 
   September 30,   June 30,   September 30, 
   2017   2018   2018 
             
 Loss from opeartions  $(27,178)  $(32,606)  $(44,147)
Add back: Shared-based compensation expenses   12,210    13,465    2,915 
 Add back: Amortization of intangible assets   20    131    131 
 Adjusted loss from continuing operations  $(14,948)  $(19,010)  $(41,101)
 Net (loss) income  $(22,765)  $166,119   $(28,760)
Add back: Shared-based compensation expenses   12,210    13,465    2,915 
Add back: Fair value change of contingent consideration   -    (2,197)   (18,301)
Add back: Amortization of intangible assets   20    131    131 
 Adjusted net (loss) income  $(10,535)  $177,518   $(44,015)