Meituan Dianping returns to profit, warns of negative revenue in first quarter

Chinese food deliveries provider Meituan Dianping (3609) said it turned a profit of 2.2 billion yuan for the year ended December 31, 2019, from a loss of 115.5 billion yuan the year before.

The company said it achieved an “important milestone of turning both operating profit and operating cash flow positive first time in our history.''

Revenues increased by 49.5 percent to 97.5 billion yuan from 65.2 billion in 2018.

Food delivery revenues increased by 43.8 percent to 54.8 billion yuan, from 38.1 billion yuan the year before.

Total gross profit increased by 114 percent to 32.3 billion yuan from 15.1 billion yuan in 2018, and operating profit turned positive at 2.7 billion yuan from a negative 11.1 billion yuan the year before.

Adjusted EBITDA and adjusted net profit were 7.3 billion yuan and 4.7 yuan billion in 2019, respectively.

Operating cash flow was a positive 5.6 billion yuan in 2019 from negative 9.2 billion yuan in 2018.

As a result of the coronavirus pandemic, Meituan Dianping said it estimates negative year-over-year revenue growth and operating loss for the first quarter of 2020.

The company said it is “unable to fully ascertain the expected impact on full year 2020 at this stage.''

But, if it takes longer for user demand and merchant operations to recover to normal levels as the pandemic continues, the results of operations for the following quarters could also be adversely impacted, Meituan Dianping said.

In the fourth quarter, Meituan Dianping reported a profit of 1.5 billion yuan from a loss of 3.4 billion yuan in the same period of 2018.