Operations

Luckin Coffee improves Q3 2021 sales, earnings

Image courtesy of Luckin Coffee.

December 13, 2021

Luckin Coffee, a pioneer in coffee vending and a competitor to Starbucks in China which recently entered into a restructuring support agreement with shareholders, improved its sales and earnings for the quarter ending Sept. 30, 2021 over the prior year's third quarter, according to an earnings report.

Net revenues rose 105.6% from RMB1.14 billion ($180 million) in Q3 2020 to RMB2.35 billion ($364.7 million) in the third quarter of 2021, primarily driven by the increased average selling price for the company's products, the gain in the number of monthly transacting customers, the growth in store footprint and the number of products sold.

Revenues from product sales increased 83.9% from RMB105 billion ($173.5 million) in Q3 2020 to RMB1.93 billion ($303.7 million) in the comparative quarters.

Revenues from partnership stores increased 355% from RMB91.5 million ($14.37 million) to RMB416.1 million ($64.6 million) in the comparative quarters.

Net loss was RMB23.5 million ($3.6 million) in the third quarter of 2021 including a one-off loss of RMB14.2 million ($2.2 million) on uncollectable deposit due to relocating the Beijing office, representing a decrease of 98.6% from a net loss of RMB1.71 billion ($258.7 million) in the same quarter of 2020.

Basic and diluted net loss per ADS improved from RMB6.80 ($1.07) to RMB0.08 (1 cent) in the comparative quarters.

Non-GAAP basic and diluted net income per ADS improved from a net loss of RMB2.40 (39 cents) to RMB 0.24 (0) in the comparative quarters.

"Our improved profitability is demonstrated through the relatively hot weather (compared to other seasons)," Dr. Jinyi Guo, chairman and CEO, said in the press release. "Further, we continued to execute against our achieving higher average selling price. Specifically, some of our innovative products, such as iced coconut latte, were very well received by our customers, benefiting from the significant reduction in operating losses for the quarter, as well as our store level operating margin increasing to over 25%."

Shares traded today at $12.18 against a 52-week range of $3.60-$17.79.