Gogox Holdings (2246) H2 2023 earnings summary

Executive summary

• FY2023 revenue fell 2.6% YoY to RMB752.8m; gross profit declined 1.4% to RMB257.9m, while net loss narrowed 9.0% to RMB1,100.6m.

• Adjusted net loss improved 25.6% to RMB170.3m and adjusted EBITDA improved 31.9% to negative RMB140.5m, reflecting lower expenses and no repeat of major 2022 fair-value and listing charges.

Financial highlights

• Revenue was RMB752.8m, down 2.6% YoY; cost of revenue fell 3.3% to RMB494.9m and gross profit was RMB257.9m, down 1.4%.

• Operating loss widened to RMB1,102.4m from RMB912.3m, primarily reflecting RMB843.5m goodwill impairment; net loss narrowed to RMB1,100.6m from RMB1,209.1m.

• Selling and marketing expenses fell 36.4% to RMB203.9m; G&A fell 66.0% to RMB269.3m; R&D fell 47.0% to RMB38.3m, largely on lower employee and share-based compensation costs.

• Financial-asset impairment rose to RMB17.7m from RMB4.2m, primarily due to older receivables in India; adjusted net loss was RMB170.3m and adjusted EBITDA was negative RMB140.5m.

Outlook and guidance

• 2024 priorities include customer-centric services, continued technology development and strategic expansion, with a stated focus on sustainable growth; no numerical guidance was given.

• Revised five-year goodwill-test assumptions use revenue CAGR of 8% for Chinese mainland and 11% for Hong Kong and overseas, versus 36% and 28% in 2022; long-term growth assumption is 2% for both regions.