BEST Inc., a China-based smart supply chain solutions and logistics services provider, announced on Thursday that it has received notice from the New York Stock Exchange that the company has regained compliance with listing standards.
On January 5, the NYSE notified the company that it was not in compliance with continued listing standards because, as of January 4, the average closing price of the company’s American Depositary Shares (ADSs) was less than $1 apiece over a consecutive 30 trading-day period. On May 20, the company implemented a change to a new ratio of one ADS to five Class A ordinary shares, par value $0.01 per share, which had the same effect as a one-for-five reverse share split.
BEST Inc., established in 2007, officially listed on the New York Stock Exchange in 2017. However, it has been recording losses for a long time since then. In December last year, it transferred its domestic express delivery business to J&T Express, and finally turned losses into profits. In 2021, its net profit was 261.9 million yuan ($39 million), a year-on-year increase of 112.93%, which was also the first time since 2016 that it achieved full-year profit.
However, in the first quarter of this year, BEST Inc. suffered losses again, with total revenue of 1.803 billion yuan, down 35.2% year-on-year, and a net operating loss of 380 million yuan, compared with 191.2 million yuan in the same period last year.
The income of BEST Inc.’s freight business and supply chain business has declined. In the first quarter, revenue from freight operations reached 1.093 billion yuan, down 46.5% year-on-year. Due to the restriction of some transport fleets, hubs and sorting centers, the freight volume was 1.683 million units, down 13.5% year-on-year. In the first quarter, the company remained focused on developing its e-commerce-related business, which contributed 22.2% of total volume during the quarter. Supply chain management services revenue decreased by 8.6% year-on-year to 409 million yuan in the period.
Johnny Chou, Founder, Chairman and CEO of BEST Inc., said: “We believe the activities of supply chain and logistics business will pick up quickly in China and SEA as the pandemic eases. BEST’s strengths in technology, domestic and international end-to-end supply chain and logistics capabilities, as well as our broad customer base in China coupled with strong cash position will allow us to capture this growth opportunity and on the path to profitability.”
Gloria Fan, BEST’s Chief Financial Officer, added: “Our balance of cash and cash equivalents, restricted cash, and short-term investments were 5.3 billion yuan at the end of the first quarter. We will continue to execute our strategic focus to achieve sustainable growth and profitability.”