Report of Foreign Issuer (6-k)

Date : 11/13/2018 @ 9:37PM
Source : Edgar (US Regulatory)
Stock : Netshoes (Cayman) Limited (NETS)
Quote : 3.7  0.0 (0.00%) @ 12:00AM
Netshoes (Cayman) Limited share price Chart

Report of Foreign Issuer (6-k)

 

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

OF THE SECURITIES EXCHANGE ACT OF 1934

For the month of November, 2018

Commission File Number 001-38055

 

NETSHOES (CAYMAN) LIMITED

(Exact name of registrant as specified in its charter)

 

 

The Cayman Islands   98-1007784
(State of incorporation or organization)   (I.R.S. Employer Identification No.)

Rua Vergueiro 961, Liberdade

01504-001 São Paulo, São Paulo, Brazil

+55 11 3028-3528

(Address, including zip code, and telephone number, including area code, of registrant’s 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  ☒            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):

Yes  ☐            No  ☒

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):

Yes  ☐            No  ☒

 

 

 

 
 

Third Quarter 2018 Results

São Paulo, Brazil – November 13, 2018 – Netshoes (Cayman) Ltd. (NYSE:NETS) (“Netshoes”), Latin America’s leading online retailer of sporting and lifestyle goods, today reported unaudited consolidated financial results for the nine and three-month period ended September 30, 2018. The results are stated in Brazilian Reais (“R$”) and prepared in accordance with International Accounting Standard 34, “Interim Financial Reporting”.

Comparative information for the nine and three-month period ended September 30, 2017 were restated for the purposes of applying IFRS 5 "Non-current assets held for sale and discontinued operations" after approval by the Board of Directors of the sale of its operations in Mexico.


Third Quarter 2018 Key Highlights

·

Growth in net sales: R$417.8 million, up 0.5% year-on-year on an FX neutral basis

·

Discontinuation of B2B operations to focus on core B2C business with a write-off of R$78.0 million

·

Further increase in GMV: R$605.1 million, up 5.5% year-on-year (FX neutral), with Marketplace GMV up 48.1% year-on-year, accounting for 13.0% of total GMV (+4 p.p. YoY)

·

B2C GMV increased 7.4% year-on-year (FX neutral)

·

Improvement in operations: Total net working capital cycle reduction of 32 days to 13 days over 2Q-2018

·

Operating cash flow generation of R$72.3 million, without contribution from factoring arrangements

Subsequent Events

·

Closing of Netshoes Mexico sale to Grupo Sierra Capital in October 2018.

 

Operating and Financial Metrics Highlights

     

Change %

   

Change %

Operating Data 1

3Q-2017

3Q-2018

YoY

YoY FX Neutral

9M-2017

9M-2018

YoY

YoY FX Neutral

Registered Members (in thousands)

20,160

23,839

18.2%

 

20,160

23,839

18.2%

 

Active Customers (in thousands)

6,025

6,721

11.6%

 

6,025

6,721

11.6%

 

Invoiced Orders (in thousands)

2,827

2,953

4.4%

 

8,046

8,564

6.4%

 

Orders Placed from Mobile Device %

46.7%

58.1%

+11.4p.p

 

43.2%

57.4%

+14.2p.p.

 

Average Basket Size (in R$)

204.9

203.5

(0.7)%

2.9%

204.9

203.9

(0.5)%

2.2%

GMV 2 (in millions)

593.6

605.1

1.9%

5.5%

1,724.0

1,763.7

2.3%

5.0%

B2C GMV (in millions)

579.2

600.9

3.7%

7.4%

1,648.9

1,746.1

5.9%

8.8%

Marketplace GMV (as % of total GMV)

8.9%

13.0%

+4.0p.p.

 

7.1%

12.1%

+5.0p.p.

 

 

 

 

Change %

 

 

Change %

Financial Data (In R$ Millions)

3Q-2017

3Q-2018

YoY

YoY FX Neutral

9M-2017

9M-2018

YoY

YoY FX Neutral

Net Sales

431.4

417.8

(3.2)%

0.5%

1,262.9

1,241.4

(1.7)%

1.0%

Net Sales - Brazil

397.0

383.3

(3.5)%

 

1,160.0

1,144.1

(1.4)%

 

Net Sales - International

34.4

34.5

0.3%

45.6%

102.9

97.3

(5.4)%

28.2%

Gross Margin %

32.7%

8.8%

(23.9)p.p

 

33.2%

23.0%

(10.2)p.p.

 

ADJUSTED EBITDA 3 Margin %

(4.2)%

(26.9)%

(22.8)p.p

 

(1.0)%

(11.4)%

(10.4)p.p.

 

 

(1)     As Mexico operation was discontinued during the third quarter of 2018, operating and financial figures exclude Mexico in 2017 and 2018.

(2)     For a reconciliation of net sales to GMV, see page 11 below.

(3)     For a reconciliation of net loss to Adjusted EBITDA Margin, see page 12 below

1

 


 
 

 

Message from the Founder and CEO, Marcio Kumruian:

 

The third quarter of 2018 marks an important turning point for Netshoes, as we took some decisive steps to streamline our operations and focus on our core B2C business in markets where we are better positioned to secure medium-term profitable growth.

As part of that strategy, we recently announced our decision to discontinue our B2B operations. This difficult but necessary step is a recognition that this diversification attempt generated lower than expected results. In order to minimize further negative results, we adjusted the margins of nutrition supplements products, accelerating sales through our B2C channel. This resulted in a provision of R$59.3 million in existing nutrition supplement inventory. In addition, we terminated our commercial agreement with Midway Labs, filed a lawsuit against them and recorded a provision of R$18.7 million for Midway receivables that may not be collected. This impacted our gross profit and adjusted EBITDA in the quarter, but we believe this discontinuation puts Netshoes on a sounder footing going forward.

In addition, in October we concluded the sale of our operations in Mexico. This will allow us to be even more focused on our core operations in Brazil, where we believe there is significant growth potential, as evidenced by our Q3 performance in those markets.

This quarter also saw us increase our financial flexibility with the successful completion of the renegotiation with banks of our working capital and debenture credit lines, increasing the original maturity of the contracts by one year, to 2021, and obtaining a 12-month grace period on principal amortization. With this renegotiation, the Company eliminated R$107.7 million in debt amortization through the first half of 2019 and brought short-term debt down to 5% of total debt, compared to 46% in 2Q-2018.

These important developments were accompanied by some further advances in our operations that attest to the strength of our underlying business. The number of active customers was up by double digits, to more than 6.7 million. Our net sales rose 0.5% and total GMV rose 5.5% on an FX neutral basis, with higher orders and average basket, reflecting the 48.1% year-on-year increase in marketplace GMV. Thanks to a strong reduction in working capital requirements, we generated a solid R$72.3 million in operating cash flow (without contribution from factoring arrangements).

We remain focused on executing our new strategy aimed at achieving profitability in our B2C online operations, and our teams are fully mobilized to deliver a strong Black Friday and Christmas period with a superior customer experience.

Our actions during the third quarter reaffirm our commitment to our renewed strategy, turning a page to continue to build our medium-term growth on a more solid foundation.

 

2

 


 
 

Overview of Third Quarter 2018 Results

 

     

Change %

   

Change %

Consolidated P&L (In R$ Millions) (1)

3Q-2017

3Q- 2018

YoY

FX Neutral

9M- 2017

9M-2018 (6)

YoY

FX Neutral

                 

GMV (2)

593.6

605.1

1.9 %

5.5 %

1,724.0

1,763.7

2.3 %

5.0 %

                 

Net Sales - Brazil

397.0

383.3

(3.5)%

 

1,160.0

1,144.1

(1.4)%

 

Net Sales - International

34.4

34.5

0.3 %

45.6 %

102.9

97.3

(5.4)%

28.2 %

Net Sales

431.4

417.8

(3.2)%

0.5 %

1,262.9

1,241.4

(1.7)%

1.0 %

Cost of Sales

(290.4)

(381.0)

31.2 %

 

(843.8)

(955.6)

13.2 %

 

Gross Profit

141.0

36.8

(73.9)%

 

419.1

285.8

(31.8)%

 

% Gross Margin

32.7 %

8.8 %

(23.9)p.p.

 

33.2 %

23.0 %

(10.2)p.p.

 

Operating Expenses

(159.0)

(149.3)

(6.1)%

 

(431.3)

(426.7)

(1.1)%

 

% of Sales

(36.8)%

(35.7)%

(1.1)p.p.

 

(34.2)%

(34.4)%

0.2p.p.

 

Selling and Marketing Exp. (ex-A&D)

(127.4)

(110.2)

(13.5)%

 

(341.3)

(322.7)

(5.4)%

 

% of Sales

(29.5)%

(26.4)%

(3.2)p.p.

 

(27.0)%

(26.0)%

(1.0)p.p.

 

General and Administrative Exp. (ex-A&D)

(30.4)

(35.2)

15.8 %

 

(86.8)

(98.1)

13.0 %

 

% of Sales

(7.1)%

(8.4)%

1.4p.p.

 

(6.9)%

(7.9)%

1.0p.p.

 

Other Operating Expenses

(1.1)

(3.8)

256.3 %

 

(3.2)

(5.9)

85.3 %

 

% of Sales

(0.2)%

(0.9)%

0.7p.p.

 

(0.3)%

(0.5)%

0.2p.p.

 

ADJUSTED EBITDA (3)

(17.9)

(112.5)

(527.4)%

 

(12.2)

(140.9)

(1055.1)%

 

% of Sales

(4.2)%

(26.9)%

(22.8)p.p.

 

(1.0)%

(11.4)%

(10.4)p.p.

 

Certain Other Net Financial Result (4)

0.8

(3.2)

(489.9)%

 

(4.3)

(11.5)

164.9 %

 

% of Sales

0.2 %

(0.8)%

(1.0)p.p.

 

(0.3)%

(0.9)%

0.6p.p.

 

EBITDA (3)

(17.1)

(115.7)

(576.3)%

 

(16.5)

(152.4)

(822.1)%

 

% of Sales

(4.0)%

(27.7)%

(23.7)p.p.

 

(1.3)%

(12.3)%

(11.0)p.p.

 

Amortization and Depreciation

(7.2)

(11.6)

61.2 %

 

(22.7)

(45.6)

100.8 %

 

% of Sales

(1.7)%

(2.8)%

1.1p.p.

 

(1.8)%

(3.7)%

1.9p.p.

 

Net Adjusted Financial Result (4)

(19.2)

(11.9)

(37.7)%

 

(69.6)

(38.3)

(44.9)%

 

% of Sales

(4.4)%

(2.9)%

(1.6)p.p.

 

(5.5)%

(3.1)%

(2.4)p.p.

 

Monetary position gain (loss), net (5)

-  

3.4

 

-

6.1

 

% of Sales

-

0.8 %

-

 

-

0.5 %

-

 

Loss Before Income Tax

(43.5)

(135.9)

212.5%

 

(108.8)

(230.3)

111.6 %

 

% of Sales

(10.1)%

(32.5)%

22.4p.p.

 

(8.6)%

(18.5)%

9.9p.p.

 

Current Income Tax

-

(0.7)

 

-

(0.9)

 

Net Loss from continuing operations

(43.5)

(136.6)

214.0%

 

(108.8)

(231.1)

112.4%

 

% of Sales

(10.1)%

(32.7)%

22.6p.p.

 

(8.6)%

(18.6)%

10.0p.p.

 

Net Loss from Descontinued Operations (1)

(4.3)

(4.0)

(6.5)%

 

(11.8)

(10.4)

(12.2)%

 

Net Loss

(47.8)

(140.6)

194.4 %

 

(120.6)

(241.5)

100.2 %

 

% of Sales

(11.1)%

(33.6)%

22.6p.p.

 

(9.6)%

(19.5)%

9.9p.p.

 

 

 

(1)    

Due to the sale of Mexico’s operation in October 2018, Mexico is presented as discontinued operation in 2017 and 2018 figures.

(2)    

For a reconciliation of net sales to GMV, see page 11 below.

(3)    

For a reconciliation of EBITDA and Adjusted EBITDA, please see page 12.

(4)    

For a reconciliation of financial income/expense to Certain Other Net Financial Result and Net Adjusted Financial Result, see page 11.

(5)    

Inflation accounting in accordance with IAS 29 Financial Reporting in Hyperinflationary Economies in the Argentinean subsidiary.

(6)    

Consolidated financial figures for the nine-month period ended September 30, 2018 include the hyperinflation impacts in P&L for the six month-period ended June 30, 2018.This adjustment was not included in the unaudited condensed consolidated financial statements for the six-month period ended June 30, 2018.

 

 

3

 


 
 

Operating Metrics

The Company’s business is organized into two segments: (1) Brazil, which consists of the B2C e-commerce operations of Netshoes (sporting goods) and Zattini (fashion), and the business-to-business (B2B) operation, mainly comprised of supplements sales (discontinued in 3Q-2018); and (2) International, which consists of the B2C e-commerce operation in Argentina.

Registered members (excluding Mexico) increased 18.2% year-on-year to 23.8 million in 3Q-2018. Active customers reached 6.7 million, up 11.6% year-on-year.

The shift of consumer purchasing habits to mobile devices has continued, with 58.1% of total orders placed from mobile devices in 3Q-2018, an 11.4 p.p. increase over 3Q-2017.

GMV from the B2C operation grew 7.4% year-on-year on an FX neutral basis in 3Q-2018 (3.7% on a reported basis), mainly driven by:

·

a 1.8% year-on-year increase in Netshoes Brazil GMV, mainly impacted by the strategic mix of product shift from 1P to 3P (products with lower margin or slower replacement cycle);

·

a 14.8% year-on-year increase in Zattini’s GMV, reflecting the success of the Company’s new strategy in fashion portfolio management.

o

Both Netshoes and Zattini showed GMV growth acceleration throughout the quarter:

GMV - YoY Growth

Jul-18

Aug-18

Sep-18

3Q-18

Netshoes Brazil

(2.1)%

1.6 %

6.3 %

1.8 %

Zattini

(6.2)%

29.2 %

31.5 %

14.8 %

 

·

a 44.6% year-on-year increase (local currency) in Netshoes International GMV (Argentina operation), but down 0.4% on a reported basis, due to the strong FX impact.

·

In 3Q-2018, invoiced orders increased 4.4% year-on-year while average basket size increased 2.9% on an FX neutral basis.

 

As previously announced, in 3Q-2018 the Company discontinued its B2B operation dedicated to the sales of nutrition supplements and vitamins. GMV for the B2B operation amounted to R$4.2 million in 3Q-2018, down 70.4% year-over-year (impacting the consolidated Company’s growth by 1.8 p.p.).

Total consolidated GMV in 3Q-2018 was R$605.1 million, up 5.5% on an FX neutral basis and up 1.9% on a reported basis.

Marketplace GMV (Netshoes & Zattini in Brazil) amounted to R$78.5 million and accounted for 13.0% of total consolidated GMV (14.1% of GMV Brazil), an increase of 48.1% year-on-year. As of September 30, 2018, the Company’s total vendor base comprised 980 qualified third-party B2C vendors, an increase of 320 vendors year-on-year and an increase of 80 vendors over 2Q-2018.

 

Revenue

Consolidated net sales were R$417.8 million in 3Q-2018, a 3.2% decrease year-on-year (+0.5% on an FX neutral basis). Net sales in Brazil decreased 3.5% year-on-year to R$383.3 million.

Net sales for the International business (Argentina) in 3Q-2018 was R$34.5 million, up 45.6% year-on-year in local currency and up 0.3% on a reported basis.

Gross Profit

Gross profit in 3Q-2018 was R$36.8 million, compared to R$141.0 million in the same period last year. Gross margin was 8.8% in 3Q-2018, compared to 32.7% in 3Q-2017. During the quarter the ramp-up of the

4

 


 
 

marketplace operation and other product margin-enhancing initiatives contributed 1.7 p.p. to gross margin, offset by the negative impact from the 1P categories the Company is shifting to the marketplace. However, management’s short-term actions aimed at turning around the operation and other non-operating impacts negatively affected gross margin by 26.2 p.p. These impacts were:

·

(19.9) p.p. due to the discontinuation of the B2B business;

·

(1.7) p.p. related to higher net shipping costs and other cost of sales, mainly affected by the acceleration of supplement sales through the Company’s B2C channel;

·

(1.8) p.p. due to lower tax benefits as a result of 2016 tax change (EC87) and to the shift of Zattini’s operation to the Barueri distribution center, resulting in higher tax charges to the P&L but allowing the use of R$70 million in tax credits over the next 15 months (estimated);

·

(2.2) p.p. impact from APV (Adjustment to Present Value) as a direct result of the Company’s adjustments in procurement activities to reduce inventory levels and hyperinflation accounting adjustment in Argentina.

 

Despite some of the temporary negative impacts on margins, the Company’s gross product margin has started to show a positive evolution throughout 3Q-2018, reflecting the improvements made in inventory planning, commercial negotiations and princing policies. These improvements are still mostly concentrated in fashion, as Zattini has a shorter procurement cycle.

It is important to highlight that the improvements in product margin in Fashion, approximately 6 p.p. from July to September, are accompanied by an acceleration in GMV growth at  Zattini. (as described above).

Gross Product Margin – B2C Brazil

Jul

Aug

Sep

3Q

Year 2017

31.8%

34.2%

33.2%

33.0%

Year 2018

32.4%

33.9%

34.5%

33.6%

 

Operating Expenses

Operating expenses, net of depreciation and amortization, were R$149.3 million in 3Q-2018, 6.1% lower than 3Q-2017. As a percentage of net sales, operating expenses were 35.7%, compared to 36.8% in 3Q-2017. During the quarter the discontinuation of the nutrition supplement B2B business impacted operating expenses by R$5.1 million or 1.2 p.p.

Selling and marketing expenses, net of depreciation and amortization, decreased 13.5% year-on-year in 3Q-2018 to R$110.2 million, representing 26.4% of net sales compared to 29.5% of net sales in 3Q-2017. This decrease was mainly because of a lower allowance for doubtful accounts expenses and lower chargeback expenses, partially offset by the already mentioned R$5.1 million expenses related to the discontinuation of the B2B business.

General and administrative expenses, net of depreciation and amortization, were R$35.2 million in 3Q-2018, 15.8% higher in comparison to 3Q-2017, representing 8.4% of net sales, versus 7.1% of net sales in 3Q-2017. This increase is mainly related to higher SOP, consulting and layoff expenses, most of them being one-off expenses.

 

Adjusted EBITDA and Net Loss

Consolidated Adjusted EBITDA was a negative R$112.5 million in 3Q-2018 (-26.9% Adj. EBITDA margin) compared to negative R$17.9 million in 3Q-2017 (-4.2% Adj. EBITDA margin). This result was due to negative R$84.2 million from the B2B operations, negative R$21.1 million from the Brazilian B2C and Holding operations and negative R$7.2 million from the Argentina operations.

·

Adjusted EBITDA for the Brazilian operation in 3Q-2018 was a negative R$100.3 million (-26.2% Adj. EBITDA margin), which includes the R$84.2 million negative result from the B2B operations and R$16.1 negative result from the B2C operations. The negative R$16.1 million result from B2C

5

 


 
 

operations includes negative R$7.3 million from Midway sales through B2C, negative R$5.3 million from Adjustment to Present Value (APV) and negative R$4.2 million from higher sales taxes in Zattini’s migration to Barueri distribution center.

·

Adjusted EBITDA for the International operation (Argentina only) in 3Q-2018 was a negative R$7.2 million (-20.9% Adj. EBITDA margin), compared to a negative R$4.5 million in 3Q-2017 (-13.1% Adj. EBITDA margin). In 3Q-2018, Adj. EBITDA was negatively impacted by a R$3.6 million non-cash effect of the hyperinflation accounting adjustment in Argentina.  

 

Due to the above-mentioned effects, the consolidated net loss from continuing operations, which excludes Mexico, was R$136.6 million in 3Q-2018 (-32.7% net margin), compared to a net loss of R$43.5 million           (-10.1% net margin) in 3Q-2017. Total impact from the B2B write-offs on Net Loss was R$78.0 million during the quarter, compared to R$14.7 million in 3Q-2017. Argentina hyperinflation adjustments in net loss in 3Q-2018 amounted to negative R$1.8 million.

 

Balance Sheet and Cash Flow

In 3Q-2018, the Company generated R$72.3 million in net cash flow from operating activities excluding the contribution from factoring arrangements (see table below). Considering the lower use of factoring arrangements, operating cash generation was R$30.4 million, reflecting mainly the R$51.5 million improvement in working capital. In comparison to 3Q-2017, the Company recorded a R$16.1 million improvement in operating cash generation, or R$81.1 million without the contribution of the factoring arrangements.

As stated previously, management will continue to adjust factoring arrangements to run the business with available liquidity of around R$50 million. During the quarter, the lower use of the arrangements consumed R$41.8 million of operating cash flow, while in 3Q-2017 they generated R$23.1 million in operating cash flow.

Cash used in investing activities amounted to R$30.8 million in 3Q-2018 and was mainly related to the development of the Company’s information technology infrastructure. In 3Q-2017, cash used in investing activities amounted to R$8.3 million.

Cash used in financing activities amounted to R$14.9 million in 3Q-2018 compared to R$102.9 million in 3Q-2017 as a result of the successful debt renegotiation announced in early August 2018, extending the original maturity of the contracts by one year (to 2021) and establishing a 12-month grace period on principal amortization. This renegotiation eliminated R$107.7 million in debt amortization during the second half of 2018 and first half of 2019.

Consequently, the change in cash and cash equivalents resulted in a consumption of R$24.7 million in 3Q-2018 compared to a R$105.8 million consumption in 3Q-2017. Cash and cash equivalents as of September  30, 2018 were R$50.6 million, compared to R$310.6 million as of September 30, 2017.

It is important to highlight that neither the B2B write-off nor Argentina hyperinflation adjustments made in 3Q-2018 had any cash effect during the period.

 

6

 


 
 

Cash Flow Statement (In R$ Millions) (1)

3Q-2017

3Q-2018

 

9M-2017

9M-2018

           

Net loss from continuing operations

(43.5)

(136.6)

 

(108.8)

(231.1)

Depreciation and amortization

7.2

12.0

 

22.7

46.0

Interest expense, net

22.9

13.9

 

83.8

45.0

Others

16.8

64.4

 

14.9

85.4

Adjusted Net Loss

3.5

(46.3)

 

12.7

(54.8)

           

Trade accounts receivable

27.7

(17.9)

 

112.5

(13.1)

Inventories

(52.1)

26.3

 

(93.1)

48.5

Trade accounts payable / Reverse Factoring

30.4

43.1

 

(22.6)

(138.6)

Changes in Working Capital

5.9

51.5

 

(3.2)

(103.1)

           

Restricted Cash

3.9

3.5

 

7.0

1.3

Recoverable taxes

(14.5)

8.1

 

(49.8)

15.0

Judicial deposits

(7.1)

(2.1)

 

(30.7)

(8.2)

Accrued expenses

1.9

3.2

 

(30.1)

(11.9)

Others

20.7

12.5

 

(2.1)

2.9

Total Changes in Assets and Liabilities

4.9

25.2

 

(105.8)

(0.9)

Net Cash Provided by (Used In) Continuing Operating Activities

14.3

30.4

 

(96.3)

(158.8)

           

Capex

(16.0)

(29.2)

 

(43.1)

(80.7)

Interest received on installment sales

0.9

0.0

 

1.1

1.2

Restricted cash

6.8

(1.6)

 

7.4

(0.3)

Net Cash Provided by (Used in) Investing Activities

(8.3)

(30.8)

 

(34.6)

(79.8)

           

Proceeds / Payment of debt

(80.0)

(2.9)

 

(9.4)

(57.0)

Payments of interest

(21.8)

(12.0)

 

(81.8)

(43.4)

Proceeds from issuance of common stock

(1.1)

0.0

 

423.4

0.0

Net Cash Provided by (Used in) Financing Activities

(102.9)

(14.9)

 

332.2

(100.5)

           

Net cash provided by discontinued operations (1)

3.4

(1.8)

 

3.2

1.3

Effect of exchange rate changes on cash and cash equivalents

(12.2)

(7.7)

 

(5.2)

(7.6)

 

 

 

 

 

 

Change in Cash and Cash Equivalents

(105.8)

(24.7)

 

199.3

(345.4)

           

Cash and cash equivalents, beginning of period

416.4

75.3

 

111.3

396.0

Cash and cash equivalents, end of period

310.6

50.6

 

310.6

50.6

 

(1)      Due to the sale of Mexico’s operation in October 2018, Mexico is presented as discontinued operation in 2017 and 2018.

 

Factoring Arrangements Impact:

3Q-2017

3Q-2018

 

9M-2017

9M-2018

Operating Cash Flow before Factoring Arrangements

(8.8)

72.3

 

(163.5)

(8.2)

(-) Credit card factoring (accounts receivable)

13.1

(28.5)

 

55.7

(80.0)

(-) Reverse factoring (accounts payable)

10.0

(13.4)

 

11.5

(70.6)

Total Factoring Arrangements

23.1

(41.8)

 

67.2

(150.6)

Operating Cash Flow after Factoring Arrangements

14.3

30.4

 

(96.3)

(158.8)

 

In 3Q-2018, the Company’s net working capital cycle was 13 days, 32 days lower than in both  3Q-2017 and 2Q-2018. This reduction was mainly a result of the inventory write-off of R$59.3 million (18 days) related to the discontinuation of the B2B business and of the improved inventory management at both Netshoes and Zattini in Brazil (12 days).

7

 


 
 

The remaining inventory of Midway nutritional products represent R$33.2 million or 10 inventory days at the end of 3Q-2018.

The trade accounts payable cycle was 105 days, compared to 109 days in 3Q-2017 and 101 days in 2Q-2018.

 

In Days (1)

3Q-2017

4Q-2017

1Q-2018

2Q-2018

3Q-2018

Trade Accounts Receivable

13

19

18

17

19

Inventories

140

143

146

129

99

Trade Accounts Payable / Reverse Factoring

109

156

102

101

105

Cash Conversion Cycle

45

5

62

45

13

 

(1)   As Mexico operations were discontinued during the third quarter of 2018, the cash conversion cycle excludes Mexico both in 2017 and 2018 periods.

 

In 3Q-2018 total indebtedness was R$228.2 million, compared to R$239.1 million in 2Q-2018.  As previously mentioned, in August 2018, the Company successfully completed the renegotiation with banks of its working capital and debenture credit lines, extending the original maturity of the contracts by one year (to 2021) and establishing a 12-month grace period on principal amortization. With this renegotiation, the Company eliminated R$107.7 million in debt amortization during the the second half of 2018 and the first half of 2019. As a result, as of September 30, 2018, 5% of total debt was short-term, compared to 46% in 2Q-2018.

 

DEBT (In R$ Millions)

3Q-2017

4Q-2017

1Q-2018

2Q-2018

3Q-2018

Working Capital

191.5

175.0

157.1

147.9

138.4

Short-term

67.3

68.3

66.1

72.7

11.1

Long-term

124.2

106.7

91.0

75.2

127.3

Debenture

93.7

84.2

74.9

65.5

64.2

Short-term

38.0

37.7

37.7

37.6

-

Long-term

55.8

46.5

37.2

27.9

64.2

Other

1.5

26.7

25.9

25.7

25.7

Short-term

1.5

0.5

0.3

0.1

1.1

Long-term

-

26.2

25.5

25.6

24.6

           

TOTAL DEBT (R$)

286.7

286.0

257.8

239.1

228.2

Short-term (%)

37%

37%

40%

46%

5%

Long-term (%)

63%

63%

60%

54%

95%

(-) Total Cash

(342.7)

(430.4)

(100.1)

(110.7)

(84.0)

Cash and cash equivalents (1)

(313.9)

(396.0)

(60.7)

(75.3)

(50.6)

Restricted cash

(28.8)

(34.4)

(39.5)

(35.4)

(33.5)

NET DEBT (R$)

(56.0)

(144.4)

157.7

128.4

144.2

(1)      Excludes cash balance from Mexico operation.

 

8

 


 
 

Subsequent Events:

Sale of Netshoes’ operations in Mexico

On October 11, 2018 the Company concluded the sale of its subsidiaries in Mexico to Grupo Sierra Capital, a private equity fund. This divestment is in line with the Company’s strategy of focusing on its core operations in Brazil increasing profitability and creating long-term value for shareholders.

 

Agreement with the Brazilian Federal District Attorney’s Office in connection with previously disclosed personal data incident

In line with principles of transparency and best practices, Netshoes announces that it reached on October 3, 2018 an agreement ( Termo de Ajustamento de Conduta ) with the Brazilian Federal District State Attorney’s Office ( Ministério Público Estadual do Distrito Federal e Territórios ) in connection with the data incident previously disclosed to the market on February 26, 2018. Netshoes agreed to pay a fine in the amount of R$500,000.00. In return, the Brazilian Federal District State Attorney’s Office will terminate its administrative legal proceeding into this incident. This agreement is still subject to ratification by Brazilian courts.

 

 

 

 

 

3Q-2018 Earnings Conference Call

A conference call with live webcast will be held tomorrow, November 14, 2018 at 8:30 am (Eastern Time).

Investors and other interested participants can access the call by dialing 1-877-883-0383 in the U.S. and 1-412-902-6506 internationally. The entry number for the conference line is 4012929. An archived webcast will be available on our IR website. For more information visit: http://investor.netshoes.com.

About Netshoes

Founded in 2000, Netshoes is the leading sports and lifestyle online retailer in Latin America and one of the largest online retailers in the region, with operations in Brazil and Argentina. Through the websites Netshoes, Zattini and Shoestock, as well as through partner-branded store sites the Company manages, it offers customers a wide selection of products and services for sports, fashion and beauty.

 

Core to the Company’s success has been a relentless focus on delivering a superior customer experience. As one of the first companies in Latin America to provide online retail offerings, Netshoes benefits from its early mover advantage, which has allowed the Company to capture significant market share and achieve a leadership position in a large and expanding addressable market. For more information, visit: http://investor.netshoes.com

 

Investor Relations Contact
Otavio Lyra, Investor Relations Officer
São Paulo, Brazil
Phone:   +55 11 3028-3528
Email:   ir@netshoes.com
http://investor.netshoes.com

 

9

 


 
 

Forward-Looking Statements

 

This press release, prepared by Netshoes (Cayman) Limited (the “Company”), contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1993, as amended, and Section 21E of the Securities Exchange of 1934, as amended.  Statements contained herein that are not clearly historical in nature, including statements about the Company’s strategies and business plans, are forward-looking, and the words “anticipate,” “believe,” “continues,” “expect,” “estimate,” “intend,” ”strategy,” “project” and similar expressions and future or conditional verbs such as “will,” “would,” “should,” “could,” “might,” “can,” “may,” or similar expressions are generally intended to identify forward-looking statements. The Company may also make forward-looking statements in its periodic reports filed with the U.S. Securities and Exchange Commission (the “SEC”), in press releases and other written materials and in oral statements made by its officers and directors. These forward-looking statements speak only as of the date they are made and are based on the Company’s current plans and expectations and are subject to a number of known and unknown uncertainties and risks, many of which are beyond the Company’s control. 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: Company’s goals and strategies; Company’s future business development; Company’s ability to maintain sufficient working capital, the continued growth of e-Commerce in Latin America, the Company’s ability to predict and react to changes in consumer demand or shopping patterns, Company’s ability to retain or increase engagement of consumers, Company’s ability to maintain or grow its net sales or business, general economic and political conditions in the countries where it  operates. Further information regarding these and other risks is included in the Company’s filings with the SEC. As a consequence, current plans, anticipated actions and future financial position and results of operations may differ significantly from those expressed in any forward-looking statements in this announcement. You are cautioned not to unduly rely on such forward-looking statements when evaluating the information presented as there is no guarantee that expected events, trends or results will actually occur. We undertake no obligation to update any forward-looking statements, whether as a result of new information or future events or for any other reason.

 

This press release may also contain estimates and other information concerning our industry that are based on industry publications, surveys and forecasts. This information involves a number of assumptions and limitations, and have not independently verified the accuracy or completeness of the information.

 

Non-IFRS Financial Measures

The Company presents non-IFRS measures when it believes that the additional information is useful and meaningful to investors. Non-IFRS financial measures do not have any standardized meaning and are therefore unlikely to be comparable to similar measures presented by other companies. The presentation of non-IFRS financial measures is not intended to be a substitute for, and should not be considered in isolation from, the financial measures reported in accordance with International Financial Reporting Standards (“IFRS”), as issued by the International Accounting Standards Board.

 

This press release includes unaudited non-IFRS financial measures, including GMV, Adjusted Selling and Marketing Expenses, Adjusted General and Administrative Expenses, Net Adjusted Financial Result, Certain Other Net Financial Result, Adjusted Operating Expenses, EBITDA, EBITDA Margin, EBITDA Brazil and EBITDA International.

 

(1): “GMV” is defined as the sum of net sales, returns, GMV from marketplace and net sales taxes, less marketplace and NCard activation commission fees;

(2) “Net Adjusted Financial Result” is defined as the sum of financial income and financial expenses less “Certain Other Net Financial Result“;

(3) “Certain Other Net Financial Result” is defined as the sum of foreign exchange gains/losses, derivative financial instruments gains/losses, bank charges and other financial income/expenses;

10

 


 
 

(4) “Adjusted EBITDA” is defined as net income/loss, less net financial result, less income tax, less depreciation and amortization expenses;

(5) “Adjusted EBITDA Brazil” or “EBITDA Brazil” is defined as Adjusted EBITDA or EBITDA for our operation in Brazil;

(6) “Adjusted EBITDA International” or “EBITDA International” is defined as Adjusted EBITDA or EBITDA for our operations in Argentina;

(7) “EBITDA” is defined as Adjusted EBITDA plus Certain Other Net Financial Result;

(8) “Adjusted EBITDA Margin” or “EBITDA Margin” is defined as Adjusted EBITDA or EBITDA divided by net sales for the relevant period, expressed as a percentage.

 

The following table shows the reconciliation for GMV, as described above:

 

GMV – Reconciliation

(In R$ Millions)

3Q-2017

3Q-2018

9M-2017

9M-2018

         

Net sales

431.4

417.8

1,262.9

1,241.4

Add (subtract):

       

Sales taxes, net

75.7

86.6

225.6

251.8

Returns

45.2

37.8

139.8

101.3

Marketplace commission fees

(11.1)

(14.9)

(24.7)

(42.0)

NCard activation commission fees

(0.6)

(0.7)

(1.3)

(1.8)

Sub-Total:

540.6

526.6

1,602.3

1,550.7

         

GMV from marketplace

53.0

78.5

121.7

213.0

         

GMV

593.6

605.1

1,724.0

1,763.7

 

The following table shows the reconciliation for Net Adjusted Financial Result and Certain Other Net Financial Result as described above:

Net Financial Result Reconciliation

(In R$ Millions)

3Q-2017

3Q-2018

9M-2017

9M-2018

         

Financial Income

8.8

7.0

23.6

13.9

Financial Expenses

(27.2)

(22.1)

(97.5)

(63.7)

Net Financial Result

(18.3)

(15.2)

(73.9)

(49.8)

Subtract Certain Other Net Financial Result:

       

Certain Other Financial Income:

       

     Foreign exchange gain

(0.8)

(4.7)

(1.2)

(5.3)

     Derivative financial instruments gain

0.0

0.0

(0.8)

0.0

     Other Financial Income

(0.0)

(0.0)

(0.0)

(0.0)

Certain Other Financial Expenses:

       

     Foreign exchange loss

(1.1)

4.4

0.7

8.9

     Derivative financial instruments loss

0.0

0.0

0.0

0.0

     Bank charges

0.8

1.0

4.8

3.3

     Other Financial Expenses

0.3

2.5

0.7

4.5

Net Adjusted Financial Result

(19.2)

(11.9)

(69.6)

(38.3)

 

1) Net Financial Result: consists of Interest income/expenses, Imputed interest on installment sales, Imputed interest on credit purchases, Debt issuance costs, Foreign exchange gains/loss, Derivative financial instruments gains/loss, Bank charges and Other financial income/expenses.

 

The following table shows the reconciliation for EBITDA, EBITDA Margin, Adjusted EBITDA and Adjusted EBITDA margin as described above:

11

 


 
 

 

Consolidated EBITDA Reconciliation

(In R$ Millions)

3Q-2017

3Q-2018

9M-2017

9M-2018

         

Net loss from continuing Operations

(43.5)

(136.6)

(108.8)

(231.1)

Add (subtract):

 

 

 

 

(-) Income tax expense

-

0.7

-

0.9

(-) Monetary gain (loss), net

-

(3.4)

-

(6.1)

(-) Net Financial Result

18.3

15.2

73.9

49.8

(-) Depreciation and Amortization

7.2

11.6

22.7

45.6

Adjusted EBITDA

(17.9)

(112.5)

(12.2)

(140.9)

(+) Certain Other Net Financial Result

0.8

(3.2)

(4.3)

(11.5)

EBITDA

(17.1)

(115.7)

(16.5)

(152.4)

Net Sales

431.4

417.8

1,262.9

1,241.4

Adjusted EBITDA Margin %

(4.2)%

(26.9)%

(1.0)%

(11.4)%

EBITDA Margin %

(4.0)%

(27.7)%

(1.3)%

(12.3)%

(1) Consolidated EBITDA includes Corporate/Holding expenses not included in EBITDA Brazil and EBITDA International.

 

EBITDA Brazil Reconciliation

(In R$ Millions)

3Q-2017

3Q-2018

9M-2017

9M-2018

         

Net loss from continuing Operations

(32.3)

(122.9)

(71.8)

(181.7)

Add (subtract):

 

 

 

 

(-) Income tax expense

-

-

-

-

(-) Monetary gain (loss), net

-

-

-

-

(-) Net Financial Result

16.3

12.0

66.0

41.5

(-) Depreciation and Amortization

6.3

10.7

19.9

29.7

Adjusted EBITDA

(9.7)

(100.3)

14.1

(110.6)

(+) Certain Other Net Financial Result

1.4

(2.1)

(3.5)

(8.5)

EBITDA

(8.4)

(102.4)

10.6

(119.1)

Net Sales

397.0

383.3

1,160.0

1,144.1

Adjusted EBITDA Margin %

(2.5)%

(26.2)%

1.2 %

(9.7)%

EBITDA Margin %

(2.1)%

(26.7)%

0.9 %

(10.4)%

 

EBITDA International (1) Reconciliation

(In R$ Millions)

3Q-2017

3Q-2018

9M-2017

9M-2018

         

Net loss from continuing Operations

(6.7)

(7.9)

(24.8)

(24.2)

Add (subtract):

 

 

 

 

(-) Income tax expense

-

0.7

-

0.9

(-) Monetary gain (loss), net

-

(3.4)

-

(6.1)

(-) Net Financial Result

2.1

3.0

6.6

8.3

(-) Depreciation and Amortization

0.1

0.4

0.5

0.8

Adjusted EBITDA

(4.5)

(7.2)

(17.7)

(20.4)

(+) Certain Other Net Financial Result

(0.5)

(1.0)

(1.6)

(2.8)

EBITDA

(5.1)

(8.2)

(19.2)

(23.2)

Net Sales

34.4

34.5

102.9

97.3

Adjusted EBITDA Margin %

(13.1)%

(20.9)%

(17.2)%

(21.0)%

EBITDA Margin %

(14.7)%

(23.6)%

(18.7)%

(23.9)%

(1)   Due to the sale of Mexico’s operation in October 2018, Mexico is presented as discontinued operation in 2017 and 2018.

 

 

12

 


 
 

Certain Definitions: 

 

Registered members

The sum of all people that have completed the registration form in all the Company’s websites.

 

Active customers

Customers who made purchases online with the Company during the preceding twelve months as of the relevant dates.

 

Invoiced orders

The total number of orders invoiced to active customers during the relevant period (online and offline sales)

 

Orders placed from mobile devices

The sum of total orders placed by active customers through the Company’s mobile site and applications as a percentage of total orders placed by active customers for the relevant period.

 

Average basket size

The sum of invoiced order value in connection with a product sale (online and offline), including shipping fees and taxes, divided by the number of total invoiced orders for the relevant period. Excludes B2B and NCard operations.

 

Gross merchandise volume (“GMV”)

The sum of net sales, returns, GMV from marketplace and net sales taxes. Excludes marketplace and NCard activation commission fees.

 

Net Working Capital Cycle

The sum of the balances of (a) Trade accounts receivable and (b) Inventories, less (c) the balance of Trade accounts payable, plus the balance of (d) Reverse factoring.

 

Partner-branded stores

All partner-branded online stores that the Company manages.

 

Foreign Exchange Neutral (“FX Neutral”)

Growth rate shown on constant local currency basis, in order to demonstrate what the results would have been had exchange rates in Argentina remained constant during the period comparison.

 

 

13

 


 
 

NETSHOES (CAYMAN) LIMITED AND SUBSIDIARIES

Unaudited Condensed Consolidated Statements of Financial Position
As of December 31, 2017 and September 30, 2018

(Reais and Dollars in thousands)

 

 

December 31,

 

September 30,

 
 

Assets

2017

 

2018

 

2018

Current assets:

BRL

 

BRL

 

USD

Cash and cash equivalents

395,962

 

50,569

 

12,630

Restricted cash

19,397

 

18,125

 

4,527

Trade accounts receivables, net

113,168

 

114,361

 

28,562

Inventories, net

456,632

 

331,676

 

82,838

Recoverable taxes

80,047

 

84,423

 

21,085

Other current assets

48,352

 

18,929

 

4,728

 

1,113,558

 

618,083

 

154,370

 

         

Non-current assets held for sale

 -

 

32,590

 

8,139

Total current assets

1,113,558

 

650,673

 

162,509

           

Non-current assets:

         

Restricted cash

15,048

 

15,335

 

3,830

Judicial deposits

106,914

 

115,078

 

28,741

Recoverable taxes

70,765

 

38,597

 

9,640

Other assets

1,950

 

10,189

 

2,545

Due from related parties

12

 

7

 

2

Property and equipment, net

73,039

 

83,202

 

20,780

Intangible assets, net

115,839

 

139,011

 

34,719

Total non-current assets

383,567

 

401,419

 

100,257

           

Total assets

1,497,125

 

1,052,092

 

262,766

 

14

 


 
 

NETSHOES (CAYMAN) LIMITED AND SUBSIDIARIES

Unaudited Condensed Consolidated Statements of Financial Position
As of December 31, 2017 and September 30, 2018

(Reais and Dollars in thousands)

 

 

December 31,

 

September 30,

Liabilities and Shareholders' Equity

2017

 

2018

 

2018

Current liabilities:

BRL

 

BRL

 

USD

Trade accounts payable

365,835

 

272,619

 

68,088

Reverse factoring

148,928

 

78,299

 

19,556

Current portion of long-term debt

106,577

 

11,955

 

2,986

Taxes and contributions payable

19,875

 

24,486

 

6,115

Deferred revenue

3,732

 

4,026

 

1,006

Accrued expenses

120,366

 

96,623

 

24,132

Other current liabilities

31,017

 

30,560

 

7,632

 

796,330

 

518,568

 

129,515

 

         

Liabilities associated with non-current assets held for sale

 -

 

30,700

 

7,667

Total current liabilities

796,330

 

549,268

 

137,182

           

Non-current liabilities:

         

Long-term debt, net of current portion

179,394

 

216,283

 

54,018

Provision for labor, civil and tax risks

12,523

 

16,822

 

4,201

Deferred revenue

25,502

 

23,017

 

5,749

Other non-current liabilities

27

 

629

 

157

Total non-current liabilities

217,446

 

256,751

 

64,125

Total liabilities

1,013,776

 

806,019

 

201,307

           

Shareholders' equity:

         

Share capital

244

 

244

 

61

Additional-paid in capital

1,345,507

 

1,347,120

 

336,452

Treasury shares

(1,533)

 

(1,533)

 

(383)

Accumulated other comprehensive loss

(13,664)

 

(11,893)

 

(2,970)

Accumulated losses

(847,125)

 

(1,087,765)

 

(271,676)

Equity attributable to owners of the parent

483,429

 

246,173

 

61,484

Equity attributable to non-controlling interests

(80)

 

(100)

 

(25)

Total shareholders' equity

483,349

 

246,073

 

61,459

           

Total liabilities and shareholders' equity

1,497,125

 

1,052,092

 

262,766

 

15

 


 
 

 

NETSHOES (CAYMAN) LIMITED AND SUBSIDIARIES

Unaudited Condensed Consolidated Statements of Profit or Loss

For the nine and three months ended September 30, 2017 and 2018
(Reais and Dollars in thousands, except loss per share)

 

 

For the nine months ended September 30,

 

For the three months ended September 30,

 

2017

 

2018

 

2018

 

2017

 

2018

 

2018

 

BRL

 

BRL

 

USD

 

BRL

 

BRL

 

USD

Net Sales

1,262,899

 

1,241,368

 

310,040

 

431,422

 

417,809

 

104,351

Cost of sales

(843,813)

 

(955,593)

 

(238,666)

 

(290,395)

 

(381,028)

 

(95,164)

Gross Profit

419,086

 

285,775

 

71,374

 

141,027

 

36,781

 

9,187

                       

Operating expenses:

                     

Selling and marketing expenses

(344,372)

 

(327,919)

 

(81,900)

 

(128,579)

 

(111,989)

 

(27,970)

General and administrative expenses

(106,447)

 

(138,520)

 

(34,596)

 

(36,521)

 

(45,084)

 

(11,258)

Other operating expenses, net

(3,193)

 

(5,915)

 

(1,478)

 

(1,076)

 

(3,834)

 

(956)

Total operating expenses

(454,012)

 

(472,354)

 

(117,974)

 

(166,176)

 

(160,907)

 

(40,184)

Operating loss

(34,926)

 

(186,579)

 

(46,600)

 

(25,149)

 

(124,126)

 

(30,997)

                       

Financial income

23,628

 

13,930

 

3,480

 

8,808

 

6,972

 

1,741

Financial expenses

(97,515)

 

(63,733)

 

(15,918)

 

(27,153)

 

(22,122)

 

(5,525)

Monetary position (loss) gain, net

-

 

6,120

 

1,529

 

-

 

3,364

 

840

Loss before income tax

(108,813)

 

(230,262)

 

(57,509)

 

(43,494)

 

(135,912)

 

(33,941)

                       

Income tax expense

-

 

(858)

 

(214)

 

-

 

(676)

 

(169)

Net Loss from continuing operations

(108,813)

 

(231,120)

 

(57,723)

 

(43,494)

 

(136,588)

 

(34,110)

                       

Net Loss from discontinued operations

(11,814)

 

(10,375)

 

(2,591)

 

(4,259)

 

(3,981)

 

(994)

                       

Net Loss

(120,627)

 

(241,495)

 

(60,314)

 

(47,753)

 

(140,569)

 

(35,104)

         

                     

Net loss attributable to:

                     

    Owners of the Parent from continuing operations

(108,398)

 

(230,715)

 

(57,623)

 

(43,381)

 

(136,454)

 

(34,080)

    Owners of the Parent from discontinued operations

(11,814)

 

(10,375)

 

(2,591)

 

(4,259)

 

(3,981)

 

(994)

    Non-controlling interests

(415)

 

(405)

 

(100)

 

(113)

 

(134)

 

(29)

                       

Loss per share attributable to owners of the Parent

                     

          Basic and diluted

(4.63)

 

(7.76)

 

(1.94)

 

(1.83)

 

(4.52)

 

(1.13)

 

 

16

 


 
 

NETSHOES (CAYMAN) LIMITED AND SUBSIDIARIES

Unaudited Condensed Consolidated Statements of Cash Flows

For the nine months ended September 30, 2017 and 2018

(Reais and Dollars in thousands)

 

 

Nine months ended September 30,

 

2017

 

2018

 

2018

 

BRL

 

BRL

 

USD

Cash flows from continuing operating activities:

         

Net loss

(108,813)

 

(231,120)

 

(57,723)

Adjustments to reconcile net loss to net cash used in operating activities:

         

Allowance for doubtful accounts

21,637

 

7,350

 

1,836

Depreciation and amortization

22,724

 

45,979

 

11,484

Loss on disposal of property and equipment, and intangible assets

168

 

307

 

77

Share-based payment

(13,552)

 

4,906

 

1,225

Deferred taxes

   

858

 

214

Provision for contingent liabilities

6,971

 

6,856

 

1,712

Interest expense, net

83,832

 

44,970

 

11,232

Monetary (gain) loss, net

-

 

2,718

 

679

Provision for inventory losses

(454)

 

44,220

 

11,044

Provision for expected losses, Other non-current assets

   

18,152

 

4,534

Other

179

 

3

 

1

Changes in operating assets and liabilities:

         

(Increase) decrease in:

         

Restricted cash

6,994

 

1,272

 

318

Trade accounts receivable

112,512

 

(13,053)

 

(3,260)

Inventories

(93,120)

 

48,482

 

12,109

Recoverable taxes

(49,838)

 

14,969

 

3,739

Judicial deposits

(30,706)

 

(8,165)

 

(2,039)

Other assets

2,319

 

(2,736)

 

(638)

Increase (decrease) in:

         

Derivative financial instruments

(186)

 

-

 

-

Trade accounts payable

(34,078)

 

(67,927)

 

(16,965)

Reverse factoring

11,489

 

(70,629)

 

(17,640)

Taxes and contributions payable

(719)

 

6,652

 

1,661

Deferred revenue

(2,493)

 

(2,192)

 

(547)

Accrued expenses

(30,135)

 

(11,857)

 

(2,961)

Share-based payment

(2,058)

 

(708)

 

(177)

Other liabilities

1,033

 

1,889

 

472

Net cash provided by (used in) operating activities

(96,296)

 

(158,804)

 

(39,658)

Cash flows from investing activities:

         

Purchase of property and equipment

(5,804)

 

(24,794)

 

(6,192)

Purchase of intangible assets

(37,293)

 

(55,873)

 

(13,955)

Interest received on installment sales

1,075

 

1,161

 

290

Restricted cash

7,392

 

(287)

 

(72)

Net cash provided by (used in) investing activities

(34,630)

 

(79,793)

 

(19,929)

Cash flows from financing activities:

         

Proceeds from debt

108,317

 

-

 

-

Payments of debt

(117,682)

 

(57,040)

 

(14,246)

Payments of interest

(81,780)

 

(43,419)

 

(10,844)

Proceeds from issuance of common shares

423,388

 

-

 

-

Net cash provided by (used in) financing activities

332,243

 

(100,459)

 

(25,090)

Net cash provided by discontinued operations

3,171

 

1,306

 

326

Effect of exchange rate changes on cash and cash equivalents

(5,229)

 

(7,643)

 

(1,914)

Change in cash and cash equivalents

199,261

 

(345,393)

 

(86,265)

Cash and cash equivalents, beginning of period

111,304

 

395,962

 

98,894

Cash and cash equivalents, end of period

310,565

 

50,569

 

12,630

 

17

 

 

 

 

SIGNATURE

Pursuant to the requirements of Section 12 of the Securities Exchange Act of 1934, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereto duly authorized.

 

Netshoes (Cayman) Limited
By:   /s/ Marcio Kumruian
Name:   Marcio Kumruian
Title:  

Chief Executive Officer

Date: November 13, 2018

 

Netshoes (Cayman) Limited (NYSE:NETS)
Historical Stock Chart

1 Year : From Nov 2018 to Nov 2019

Click Here for more Netshoes (Cayman) Limited Charts.

Netshoes (Cayman) Limited (NYSE:NETS)
Intraday Stock Chart

Today : Sunday 17 November 2019

Click Here for more Netshoes (Cayman) Limited Charts.

Latest NETS Messages

{{bbMessage.M_Alias}} {{bbMessage.MSG_Date}} {{bbMessage.HowLongAgo}} {{bbMessage.MSG_ID}} {{bbMessage.MSG_Subject}}

Loading Messages....


No posts yet, be the first! No {{symbol}} Message Board. Create One! See More Posts on {{symbol}} Message Board See More Message Board Posts
Your Recent History
LSE
GKP
Gulf Keyst..
LSE
QPP
Quindell
FTSE
UKX
FTSE 100
LSE
IOF
Iofina
FX
GBPUSD
UK Sterlin..
Stocks you've viewed will appear in this box, letting you easily return to quotes you've seen previously.

Register now to create your own custom streaming stock watchlist.

NYSE, AMEX, and ASX quotes are delayed by at least 20 minutes.
All other quotes are delayed by at least 15 minutes unless otherwise stated.

By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions

P: V:us D:20191117 05:26:15