meli-20200429x8k
falseAR000109959000010995902020-04-292020-04-29

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event Reported): April 29, 2020

MercadoLibre, Inc.

(Exact name of Registrant as specified in Charter)

Commission file number 001-33647

Delaware

 

98-0212790

(State or other jurisdiction of

incorporation )

 

(I.R.S. Employer

Identification Number)

Arias 3751, 7th Floor

Buenos Aires, Argentina, C1430CRG

(Address of registrant’s principal executive offices) (ZIP Code)

(+5411) 4640-8000

(Registrant’s telephone number, including area code)

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of Class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, $0.001 par value per share

MELI

  Nasdaq Global Select Market  

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2). Emerging growth company ¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨



Item 2.02. Results of Operations and Financial Condition.

On May 5, 2020, the Registrant issued a press release, a copy of which is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

Item 9.01. Financial Statements and Exhibits.

Exhibit Number

Description

99.1

Press release dated May 5, 2020

104

The cover page from this Current Report on Form 8-K, formatted in Inline XBRL



Signatures

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.

MERCADOLIBRE, INC.

Registrant

Date: May 5, 2020

By:

/s/ Pedro Arnt

Pedro Arnt

Chief Financial Officer

Exhibit 99.1



Imagen 2

MercadoLibre, Inc. Reports First Quarter 2020 Financial Results



Net Revenues of $652.1 million, up 70.5% year-over-year on an FX neutral basis

$8.1 billion Total Payment Volume, up 82.2% year-over-year on an FX neutral basis

$3.4 billion Gross Merchandise Volume, up 34.2% year-over-year on an FX neutral basis



BUENOS AIRES, Argentina, May 5th, 2020 (GLOBE NEWSWIRE) -- MercadoLibre, Inc. (Nasdaq: MELI) (http://www.mercadolibre.com), Latin America’s leading e-commerce technology company, today reported financial results for the quarter ended March 31, 2020.

 

Pedro Arnt, Chief Financial Officer of MercadoLibre, Inc., commented, Given the difficult circumstances the world is facing, we are optimistic about the results we've delivered during the first quarter of 2020. Although less affected than others, our business did register this impact, primarily during the first weeks of the imposed lockdowns, with a rebound throughout April. We remain committed to doing our part, by empowering our merchants to continue operating and securing deliveries of goods needed by households. We feel Mercado Libre has the opportunity to emerge from this situation stronger and with an even greater sense of purpose. We trust the dedication and commitment being demonstrated by our entire organization will allow us to continue executing our strategy with no significant interruptions, and in doing so play our part in contributing to making things less difficult to our users during these trying times. Finally, and most importantly, our hearts go out to those individuals and families affected by COVID-19, and our gratitude and appreciation go out to all those brave individuals who are on the front lines working through this unprecedented global health crisis.”



Recent COVID-19 related key trends

·

Government-imposed total or partial lockdowns instituted throughout Latin America in late March impacted geographic segments and business lines differently. Additionally, the magnitude of negative impact was greater in the initial weeks following government mandated lock downs, with gradual improvements as time elapsed.

·

The marketplace KPI’s hit a low point during the week of the 18th to the 24th of March. Year-over-year growth for items sold during that week troughed at 3.3%, with Fx Neutral GMV declining by 1.4%. From then onwards, we have seen a strong rebound, with growth rates accelerating in April to 75.8% year-over-year in Items Sold and 72.6% Fx Neutral year-over-year in GMV for the full month.

·

Initially, consumers seem to have pulled back on expenditures on non-essential items. This led to a mix shift in sales. Categories such as health, consumer packaged goods and toys and games showed strength, with volume growth in those categories exceeding 100% year-over-year on an FX neutral basis in some markets. Conversely, certain higher ticket, non-essential categories such as auto parts and consumer electronics saw marked declines in growth rates.

·

Managed logistics network continued operating normally, guaranteeing timely deliveries for orders shipped through it. Warehouses remain with no significant disruptions, rapidly approaching having half of our shipments already running on our own logistics network, not only improving average cost per order and shipping times but also service levels.

·

The fintech business also experienced an initial slowdown during the third week of March, followed by sequential weekly improvements through the last week of March and into April. Off marketplace TPV growth during the second half of March was 95.4% year-over-year on an FX Neutral basis, and TPN was 87.3% year-over-year. By April these growth rates had accelerated to 155.6% and 119.8% respectively. Deceleration in number and volume of payments processed was a consequence primarily of lower foot traffic in physical retail, which had a direct impact on lower mobile point of sale and QR total payment volume growth partially offset by the relative strength in Merchant Services.

·

By the end of the quarter, the non performing loan ratios had not shown a deterioration due to the COVID-19 crisis.

·

Nonetheless, to manage our exposure to merchant and consumer credits amidst a global pandemic, we slowed credit originations to both cohorts.

·

In terms of liquidity and cash management for the fintech business, all relevant funding sources remained available, drawing on credit facilities to maximize liquidity at a local subsidiary level. The consolidated Balance Sheet currently holds approximately $2.3 billion dollars in cash, cash equivalents and liquid securities.

1

 


 

First Quarter 2020 Business Highlights

·

Unique active users grew 30.9% reaching 43.2 million.

·

Total payment volume (“TPV”) through Mercado Pago reached $8.1 billion, a year-over-year increase of 43.5% in USD and 82.2% on an FX neutral basis. Total payment transactions increased 102.0% year-over-year, totaling 290.7 million transactions for the quarter.

·

Off platform TPV grew 84.2% in USD and 139.5% year-over-year on a FX neutral basis reaching $4.7 billion in transactions and 217.3 million payments, a 146.2% year-over-year growth.

·

On a consolidated basis MPOS TPV grew 103.3% on an FX neutral basis.

·

Mobile wallet delivered this quarter $1.3 billion in transactions on a consolidated basis, leading to a 299.2% year-over-year growth on a FX neutral basis for the full first quarter 2020. Our mobile wallet consumer base grew by 155.1% compared to the first quarter 2019, surpassing the 8 million unique payers mark. TPV from mobile wallet in Argentina, Brazil and Mexico continues to grow by triple digits year-over-year.

·

Our asset management product, Mercado Fondo, is now available in Argentina, Brazil and Mexico. Mexico was launched during the quarter, leading Mercado Fondo with more than $ 350 million under management and more than 7.3 million users across Latin America.

·

Our online off-platform payments solution, Merchant Services, had the lowest deceleration during the quarter growing on a consolidated basis 81.7% year-over-year on a FX Neutral basis.

·

Gross merchandise volume (“GMV”) reached $3.4 billion, representing an increase of 10.6% in USD and 34.2% on an FX neutral basis.

·

Items sold reached 105.7 million, growing 27.6% year-over-year.  

·

Live listings offered on MercadoLibre’s marketplace reached 267.4 million, a 29.8% year-over-year growth.

·

Mobile gross merchandise volume grew 197.6% year-over-year on an FX neutral basis, reaching 69.8% of GMV.

·

Items shipped through Mercado Envios reached 90.2 million, a 44.6% year-over-year increase, driven primarily by optimizations in our free shipping program.

2

 


 



First Quarter 2020 Financial Highlights

·

Net revenues for the first quarter were $652.1 million, a year-over-year increase of 37.6% in USD and 70.5% on an FX neutral basis.

·

Commerce revenues increased 32.7% year-over-year in USD and 62.0% on an FX neutral basis, while Fintech revenues increased 45.2% year-over-year in USD and 83.4% on an FX neutral basis.

·

Gross profit was $312.8 million with a margin of 48.0%, compared to 50.0% in the first quarter of 2019.

·

Total operating expenses were $342.5 million, an increase of 51.0% year-over-year in USD. As a percentage of revenues, operating expenses were 52.5%, compared to 47.9% during the first quarter of 2019. The $34.7 million improvement in operating expenses quarter-over-quarter was mostly driven by a decrease of $60.2 million in marketing expenditure, partially offset by a deterioration in bad debt.

·

Loss from operations was $29.7 million, compared to a loss of $68.9 million during the prior quarter. As a percentage of revenues, the loss from operations reached 4.6% improving 567 bps sequentially.

·

Interest income was $36.8 million, a 50.5% increase year-over-year, as a result of equity offering during March 2019, which generated more invested volume and interest gain, and a higher float in Argentina.

·

The Company incurred $23.6 million in financial expenses this quarter, mainly attributable to secured financial loans and interest expenses from our trusts related to our factoring business in Argentina.

·

Net loss before taxes was $16.7 million, up from a loss of $63.0 million during last quarter.

·

Income tax expense was $4.4 million.

·

Net loss was $21.1 million, resulting in basic net loss per share of $0.44.





The following table summarizes certain key performance metrics for the three months periods ended March 31, 2020 and 2019.







 

 

 

 

 

 



  

 

Three-month Periods Ended
March 31, (*)

(in millions)

  

 

2020

2019



  

 

 

  

 

 

Unique active users 

  

 

43.2 

  

 

33.0 

Number of confirmed new registered users during period

  

 

13.0 

  

 

12.3 

Gross merchandise volume 

  

$

3,414.1 

  

$

3,087.8 

Number of successful items sold

  

 

105.7 

  

 

82.8 

Number of successful items shipped 

 

 

90.2 

 

 

62.4 

Total payment volume 

  

$

8,094.5 

  

$

5,639.1 

Total volume of payments on marketplace 

  

$

3,203.3 

  

$

2,896.1 

Total payment transactions 

 

 

290.7 

 

 

143.9 

Capital expenditures

  

$

53.5 

  

$

33.0 

Depreciation and amortization

  

$

21.6 

  

$

15.7 



(*) Figures have been calculated using rounded amounts. Growth calculations based on this table may not total due to rounding.



Year-over-year USD Revenue Growth Rates by Quarter





 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 

 

 

Consolidated Net Revenues

 

Q1’19

 

 

Q2’19

 

Q3’19

 

Q4’19

 

Q1’20

 



 

 

 

 

 

 

 

 

 

 

 

 

Brazil

 

64

%

 

74

%

77

%

61

%

31

%



 

 

 

 

 

 

 

 

 

 

 

 

Argentina

 

(8)

%

 

14

%

39

%

46

%

42

%



 

 

 

 

 

 

 

 

 

 

 

 

Mexico

 

220

%

 

267

%

146

%

86

%

74

%



 

 

 

 

 

 

 

 

 

 

 

 



3

 


 

Year-over-year Local Currency Revenue Growth Rates by Quarter 





 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 

 

 

Consolidated Net Revenues

 

Q1’19

 

 

Q2’19

 

Q3’19

 

Q4’19

 

Q1’20

 



 

 

 

 

 

 

 

 

 

 

 

 

Brazil

 

91

%

 

89

%

77

%

74

%

55

%



 

 

 

 

 

 

 

 

 

 

 

 

Argentina

 

83

%

 

115

%

119

%

133

%

123

%



 

 

 

 

 

 

 

 

 

 

 

 

Mexico

 

227

%

 

261

%

153

%

80

%

81

%



 

 

 

 

 

 

 

 

 

 

 

 













Conference Call and Webcast

The Company will host a conference call and audio webcast on May 5th, 2020 at 4:30 p.m. Eastern Time. The conference call may be accessed by dialing (877) 303-7209 / (970) 315-0420 (Conference ID –6697812–) and requesting inclusion in the call for MercadoLibre. The live conference call can be accessed via audio webcast at the investor relations section of the Company's website, at http://investor.mercadolibre.com. An archive of the webcast will be available for one week following the conclusion of the conference call.

4

 


 

Definition of Selected Operational Metrics

Unique Active User – New or existing user who performed at least one of the following actions during the reported period: (1) made one purchase, or reservation, or asked one question on MercadoLibre Marketplace or Classified Marketplace (2) maintained an active listing on MercadoLibre Marketplace or Classified Marketplace (3) maintained an active account in Mercado Shops (4) made a payment, money transfer, collection and/or advance using Mercado Pago (5) maintained an outstanding credit line through Mercado Credito or (6) maintained a balance of more than $5 invested in a Mercado Fondo asset management account.

Foreign Exchange (“FX”) Neutral – Calculated by using the average monthly exchange rate of each month of 2019 and applying it to the corresponding months in the current year, so as to calculate what the results would have been had exchange rates remained constant. Intercompany allocations are excluded from this calculation. These calculations do not include any other macroeconomic effect such as local currency inflation effects or any price adjustment to compensate local currency inflation or devaluations.

Gross merchandise volume – Measure of the total U.S. dollar sum of all transactions completed through the Mercado Libre Marketplace, excluding Classifieds transactions.

Total payment transactions – Measure of the number of all transactions paid for using Mercado Pago.

Total volume of payments on marketplace - Measure of the total U.S. dollar sum of all marketplace transactions paid for using Mercado Pago, excluding shipping and financing fees.

Total payment volume– Measure of total U.S. dollar sum of all transactions paid for using Mercado Pago, including marketplace and non-marketplace transactions.

Commerce - Revenues from core marketplace fees, shipping fees (net out of shipping subsidies), ad sales, classified fees and other ancillary services

Fintech - Revenues includes fees from payments revenue stream

Items sold – Measure of the number of items that were sold/purchased through the Mercado Libre Marketplace, excluding Classifieds items.

Items shipped – Measure of the number of items that were shipped through our shipping service.

Local Currency Growth Rates – Refer to FX Neutral definition.

Net income margin – Defined as net income as a percentage of net revenues.

New confirmed registered users – Measure of the number of new users who have registered on the Mercado Libre Marketplace and confirmed their registration, excluding Classifieds users.

Operating margin – Defined as income from operations as a percentage of net revenues.

5

 


 



About MercadoLibre

Founded in 1999, MercadoLibre is the largest online commerce ecosystem in Latin America, serving as an integrated regional platform and as a provider of the necessary online and technology- based tools that allow businesses and individuals to trade products and services in the region. The Company enables commerce through its marketplace platform (including online classifieds for motor vehicles, vessels, aircraft, services and real estate), which allows users to buy and sell in most of Latin America.



The Company is listed on NASDAQ (Nasdaq: MELI) following its initial public offering in 2007.



For more information about the Company visit: http://investor.mercadolibre.com.



The MercadoLibre, Inc. logo is available at https://resource.globenewswire.com/Resource/Download/6ab227b7-693f-4b17-b80c-552ae45c76bf?size=0



Forward-Looking Statements

Any statements herein regarding MercadoLibre, Inc. that are not historical or current facts are forward-looking statements. These forward-looking statements convey MercadoLibre, Inc.’s current expectations or forecasts of future events. Forward-looking statements regarding MercadoLibre, Inc. involve known and unknown risks, uncertainties and other factors that may cause MercadoLibre, Inc.’s actual results, performance or achievements to be materially different from any future results, performances or achievements expressed or implied by the forward-looking statements. Certain of these risks and uncertainties are described in the “Risk Factors,” “Forward-Looking Statements” and “Cautionary Note Regarding Forward-Looking Statements” sections of MercadoLibre, Inc.’s annual report on Form 10-K for the year ended December 31, 2019, “Item 1A-Risk Factors” in Part II of our Form 10-Q for the quarter ended March 31, 2020, and any of MercadoLibre, Inc.’s other applicable filings with the Securities and Exchange Commission. Unless required by law, MercadoLibre, Inc. undertakes no obligation to publicly update or revise any forward-looking statements to reflect circumstances or events after the date hereof.

6

 


 





MercadoLibre, Inc.

Consolidated Balance Sheets

(In thousands of U.S. dollars, except par value)



 

 

 



March 31,

 

December 31,



2020

 

2019

Assets

 

 

 

Current assets:

 

 

 

Cash and cash equivalents

$                    1,071,217

 

$                    1,384,740

Restricted cash and cash equivalents

194,166 

 

66,684 

Short-term investments (353,162 and 522,798 held in guarantee)

1,558,325 

 

1,597,241 

Accounts receivable, net

34,060 

 

35,446 

Credit cards receivable, net

366,803 

 

379,969 

Loans receivable, net

141,419 

 

182,105 

Prepaid expenses

35,294 

 

45,309 

Inventory

12,114 

 

8,626 

Other assets

96,876 

 

88,736 

Total current assets

3,510,274 

 

3,788,856 

Non-current assets:

 

 

 

Long-term investments

269,955 

 

263,983 

Loans receivable, net

6,879 

 

6,439 

Property and equipment, net

239,249 

 

244,257 

Operating lease right-of-use assets

183,534 

 

200,449 

Goodwill

82,283 

 

87,609 

Intangible assets, net

17,133 

 

14,275 

Deferred tax assets

102,296 

 

117,582 

Other assets

46,477 

 

58,241 

Total non-current assets

947,806 

 

992,835 

Total assets

$                    4,458,080

 

$                    4,781,691

Liabilities

 

 

 

Current liabilities:

 

 

 

Accounts payable and accrued expenses

$                       295,500

 

$                       372,309

Funds payable to customers

718,454 

 

894,057 

Salaries and social security payable

100,059 

 

101,841 

Taxes payable

46,394 

 

60,247 

Loans payable and other financial liabilities

316,508 

 

186,138 

Operating lease liabilities

23,025 

 

23,259 

Other liabilities

76,560 

 

114,469 

Total current liabilities

1,576,500 

 

1,752,320 

Non-current liabilities:

 

 

 

Salaries and social security payable

16,165 

 

26,803 

Loans payable and other financial liabilities

616,295 

 

631,353 

Operating lease liabilities

169,147 

 

176,673 

Deferred tax liabilities

98,048 

 

99,952 

Other liabilities

16,515 

 

12,627 

Total non-current liabilities

916,170 

 

947,408 

Total liabilities

$                    2,492,670

 

$                    2,699,728



 

 

 

Commitments and Contingencies

 

 

 



 

 

 

Redeemable convertible preferred stock, $0.001 par value, 40,000,000 shares authorized,

 

 

 

100,000 shares issued and outstanding at March 31, 2020 and December 31, 2019

$                         98,843

 

$                         98,843



 

 

 

Equity

 

 

 



 

 

 

Common stock, $0.001 par value, 110,000,000 shares authorized,

 

 

 

49,709,955 shares issued and outstanding at March 31,

 

 

 

2020 and December 31, 2019

$                                50

 

$                                50

Additional paid-in capital

2,068,048 

 

2,067,869 

Treasury stock

(720)

 

(720)

Retained earnings

295,913 

 

322,592 

Accumulated other comprehensive loss

(496,724)

 

(406,671)

Total Equity

1,866,567 

 

1,983,120 

Total Liabilities, Redeemable convertible preferred stock and Equity

$                    4,458,080

 

$                    4,781,691





7

 


 

MercadoLibre, Inc.

Consolidated Statements of Income

For the three-month periods ended March 31, 2020 and 2019

(In thousands of U.S. dollars, except for share data)





 

 

 

 



 

Three Months Ended March 31,



 

2020

 

2019

Net revenues

 

$                  652,091

 

$                  473,770

Cost of net revenues

 

(339,277)

 

(236,766)

Gross profit

 

312,814 

 

237,004 

Operating expenses:

 

 

 

 

Product and technology development

 

(73,435)

 

(52,369)

Sales and marketing

 

(206,507)

 

(130,676)

General and administrative

 

(62,566)

 

(43,820)

Total operating expenses

 

(342,508)

 

(226,865)

(Loss) income from operations

 

(29,694)

 

10,139 



 

 

 

 

Other income (expenses):

 

 

 

 

Interest income and other financial gains

 

36,784 

 

24,444 

Interest expense and other financial losses

 

(23,584)

 

(15,559)

Foreign currency losses

 

(186)

 

(3,669)

Net (loss) income before income tax expense

 

(16,680)

 

15,355 



 

 

 

 

Income tax expense

 

(4,429)

 

(3,491)

Net (loss) income

 

$                  (21,109)

 

$                    11,864







 

 

 

 



 

Three Months Ended March 31,



 

2020

 

2019

Basic EPS

 

 

 

 

Basic net (loss) income

 

 

 

 

Available to shareholders per common share

 

$                     (0.44)

 

$                       0.13

Weighted average of outstanding common shares

 

49,709,955 

 

45,980,255 

Diluted EPS

 

 

 

 

Diluted net (loss) income

 

 

 

 

Available to shareholders per common share

 

$                     (0.44)

 

$                       0.13

Weighted average of outstanding common shares

 

49,709,955 

 

45,980,255 



 

 

 

 







8

 


 

MercadoLibre, Inc.

Consolidated Statement of Cash Flows

For the three months ended March 31, 2020 and 2019







 

 

 

 



 

Three Months Ended March 31,



 

2020

 

2019



 

 

Cash flows from operations:

 

 

 

 

Net (loss) income

 

$                 (21,109)

 

$                   11,864

Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities:

 

 

 

 

Unrealized devaluation loss, net

 

18,505 

 

1,886 

Depreciation and amortization

 

21,550 

 

15,694 

Accrued interest

 

(22,352)

 

(8,699)

Non cash interest, convertible notes amortization of debt discount and amortization of debt issuance costs and other charges

 

20,787 

 

3,018 

Financial results on derivative instruments

 

(16,767)

 

 —

Stock-based compensation expense — restricted shares

 

179 

 

 —

LTRP accrued compensation

 

15,664 

 

13,441 

Deferred income taxes

 

(4,199)

 

(14,456)

Changes in assets and liabilities:

 

 

 

 

Accounts receivable 

 

19,748 

 

337 

Credit card receivables

 

(33,303)

 

35,893 

Prepaid expenses

 

8,560 

 

3,316 

Inventory

 

(5,272)

 

1,652 

Other assets

 

(5,796)

 

(5,085)

Payables and accrued expenses

 

(43,101)

 

(491)

Funds payable to customers

 

(21,344)

 

63,730 

Other liabilities

 

(32,206)

 

12,735 

Interest received from investments

 

14,805 

 

3,536 

Net cash (used in) provided by operating activities

 

(85,651)

 

138,371 

Cash flows from investing activities:

 

 

 

 

Purchase of investments

 

(1,323,631)

 

(1,624,226)

Proceeds from sale and maturity of investments

 

1,249,960 

 

439,712 

Receipts from settlements of derivative instruments

 

3,668 

 

 —

Payment for acquired businesses, net of cash acquired

 

(7,561)

 

 —

Purchases of intangible assets

 

(93)

 

(34)

Changes in principal of loans receivable, net

 

(27,250)

 

(42,609)

Purchases of property and equipment

 

(45,175)

 

(32,928)

Net cash used in investing activities

 

(150,082)

 

(1,260,085)

Cash flows from financing activities:

 

 

 

 

Proceeds from loans payable and other financial liabilities

 

749,617 

 

33,977 

Payments on loans payable and other financing liabilities

 

(593,497)

 

(23,816)

Payment of finance lease obligations

 

(564)

 

(662)

Dividends paid of preferred stock

 

(1,000)

 

 —

Proceeds from issuance of convertible redeemable preferred stock, net

 

 

 

98,688 

Proceeds from issuance of common stock, net

 

 

 

1,866,500 

Net cash provided by financing activities

 

154,556 

 

1,974,687 

Effect of exchange rate changes on cash, cash equivalents, restricted cash and cash equivalents

 

(104,864)

 

(11,407)

Net (decrease) increase in cash, cash equivalents, restricted cash and cash equivalents

 

(186,041)

 

841,566 

Cash, cash equivalents, restricted cash and cash equivalents, beginning of the period

 

$              1,451,424

 

$                 464,695

Cash, cash equivalents, restricted cash and cash equivalents, end of the period

 

$              1,265,383

 

$              1,306,261



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Financial results of reporting segments





 

 

 

 

 

 

 

 

 

 



 

Three Months Ended March 31, 2020



 

Brazil

 

Argentina

 

Mexico

 

Other Countries

 

Total



 

(In thousands)

Net revenues

 

$                        397,447 

 

$                        132,875 

 

$                          94,753 

 

$                          27,016 

 

$                        652,091 

Direct costs

 

(322,628)

 

(101,025)

 

(114,762)

 

(27,604)

 

(566,019)

Direct contribution

 

74,819 

 

31,850 

 

(20,009)

 

(588)

 

86,072 



 

 

 

 

 

 

 

 

 

 

Operating expenses and indirect costs of net revenues

 

 

 

 

 

 

 

 

 

(115,766)

Loss from operations

 

 

 

 

 

 

 

 

 

(29,694)



 

 

 

 

 

 

 

 

 

 

Other income (expenses):

 

 

 

 

 

 

 

 

 

 

Interest income and other financial gains

 

 

 

 

 

 

 

 

 

36,784 

Interest expense and other financial losses

 

 

 

 

 

 

 

 

 

(23,584)

Foreign currency losses

 

 

 

 

 

 

 

 

 

(186)

Net loss before income tax expense

 

 

 

 

 

 

 

 

 

$                       (16,680)









 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 



 

Three Months Ended March 31, 2019



 

Brazil

 

Argentina

 

Mexico

 

Other Countries

 

Total



 

(In thousands)

Net revenues

 

$                        302,384 

 

$                          93,776 

 

$                          54,561 

 

$                          23,049 

 

$                        473,770 

Direct costs

 

(225,343)

 

(67,492)

 

(65,585)

 

(20,447)

 

(378,867)

Direct contribution

 

77,041 

 

26,284 

 

(11,024)

 

2,602 

 

94,903 



 

 

 

 

 

 

 

 

 

 

Operating expenses and indirect costs of net revenues

 

 

 

 

 

 

 

 

 

(84,764)

Income from operations

 

 

 

 

 

 

 

 

 

10,139 



 

 

 

 

 

 

 

 

 

 

Other income (expenses):

 

 

 

 

 

 

 

 

 

 

Interest income and other financial gains

 

 

 

 

 

 

 

 

 

24,444 

Interest expense and other financial losses

 

 

 

 

 

 

 

 

 

(15,559)

Foreign currency losses

 

 

 

 

 

 

 

 

 

(3,669)

Net income before income tax expense

 

 

 

 

 

 

 

 

 

$                          15,355 



10

 


 



Non-GAAP Financial Measures

To supplement our consolidated financial statements presented in accordance with U.S. GAAP, we use foreign exchange (“FX”) neutral measures.

This non-GAAP measure should not be considered in isolation or as a substitute for measures of performance prepared in accordance with U.S. GAAP and may be different from non-GAAP measures used by other companies. In addition, this non-GAAP measure is not based on any comprehensive set of accounting rules or principles. Non-GAAP measures have limitations in that they do not reflect all of the amounts associated with our results of operations as determined in accordance with U.S. GAAP. This non-GAAP financial measure should only be used to evaluate our results of operations in conjunction with the most comparable U.S. GAAP financial measures.

Reconciliation of this non-GAAP financial measure to the most comparable U.S. GAAP financial measures can be found in the tables included in this quarterly report.

The Company believes that reconciliation of FX neutral measures to the most directly comparable GAAP measure provides investors an overall understanding of our current financial performance and its prospects for the future. Specifically, we believe this non-GAAP measure provide useful information to both management and investors by excluding the foreign currency exchange rate impact that may not be indicative of our core operating results and business outlook.

The FX neutral measures were calculated by using the average monthly exchange rates for each month during 2019 and applying them to the corresponding months in 2020, so as to calculate what our results would have been had exchange rates remained stable from one year to the next. The table below excludes intercompany allocation FX effects. Finally, this measure does not include any other macroeconomic effect such as local currency inflation effects, the impact on impairment calculations or any price adjustment to compensate local currency inflation or devaluations.

The following table sets forth the FX neutral measures related to our reported results of the operations for the three-month period ended March 31, 2020:





 

 

 

 

 

 

 

 

 

 

 

 



 

Three-Month Periods Ended
March 31, (*)



 

As reported

 

FX Neutral Measures

 

As reported

 

 

(In millions, except percentages)

 

2020

 

2019

 

Percentage Change

 

2020

 

2019

 

Percentage Change



 

(Unaudited)

 

 

 

(Unaudited)

 

 

Net revenues

 

$                                 652.1

 

$                        473.8

 

37.6% 

 

$                           807.7

 

$                        473.8

 

70.5% 

Cost of net revenues

 

(339.3)

 

(236.8)

 

43.3% 

 

(422.4)

 

(236.8)

 

78.4% 

Gross profit

 

312.8 

 

237.0 

 

32.0% 

 

385.3 

 

237.0 

 

62.6% 



 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses

 

(342.5)

 

(226.9)

 

51.0% 

 

(463.5)

 

(226.9)

 

104.3% 

(Loss) Income from operations

 

(29.7)

 

10.1 

 

-392.9%

 

(78.3)

 

10.1 

 

-871.5%



(*) The table above may not total due to rounding.





CONTACT: MercadoLibre, Inc.

 Investor Relations

investor@mercadolibre.com


 http://investor.mercadolibre.com 

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