SHANGHAI- 111, Inc. ('111' or the 'Company') (NASDAQ: YI), a leading tech-enabled healthcare platform company committed to digitally connecting patients with medicine and healthcare services in China, today announced its unaudited financial results for the fourth quarter and fiscal year ended December 31, 2022.
Fourth Quarter 2022 Highlights
Net revenues were RMB4.1 billion (US$601.4 million), representing an increase of 19.9% year-over-year.
Gross segment profit (1) increased by 23.8% year-over-year, with B2B segment profit increasing by 31.5% year-over-year.
Loss from operations was RMB108.4 million (US$15.7 million), compared to RMB104.7 million in the same quarter of last year. As a percentage of net revenues, loss from operations decreased to 2.61% from 3.03% in the same quarter of last year.
Non-GAAP loss from operations (2) was RMB39.7 million (US$5.8 million), compared to RMB76.9 million in the same quarter of last year. As a percentage of net revenues, non-GAAP loss from operations decreased to 0.96% from 2.22% in the same quarter of last year.
RMB63.2 million (US$9.2 million) cash flow was generated from operating activities in the quarter. It was the second consecutive quarter that we achieved positive operating cash flow.
Fiscal Year 2022 Highlights
Net revenues were RMB13.5 billion (US$2.0 billion), representing an increase of 8.8% year-over-year.
Gross segment profit increased by 35.2% year-over-year and gross segment margin improved from 5.0% to 6.2%.
Loss from operations was RMB371.0 million (US$53.8 million), compared to RMB642.1 million last year. As a percentage of net revenues, loss from operations decreased to 2.7% this year from 5.2% last year.
Non-GAAP loss from operations was RMB213.6 million (US$31.0 million), compared to RMB496.5 million last year. As a percentage of net revenues, non-GAAP loss from operations decreased to 1.6% this year from 4.0% last year.
Cash and cash equivalents, restricted cash and short-term investments at the end of 2022 amounted to RMB 922.7 million (US$133.8 million) as of December 31, 2022.
(1) Gross segment profit represents net revenues less cost of goods sold.
(2) Non-GAAP loss from operations represents loss from operations excluding share-based compensation expenses.
Mr. Junling Liu, Co-Founder, Chairman, and Chief Executive Officer of 111, commented, 'We are pleased to report another solid quarter and the results brought us very close to profitability. Net revenue increased by 19.9% year-over-year to RMB 4.1 billion, marking the 18th consecutive quarter of year-over-year growth for 111 since the company's NASDAQ IPO. Our gross segment profit for the quarter increased by 23.8% and gross segment margin as a percentage of net revenues improved to 6.1% from 5.9% in the same quarter of last year. Non-GAAP loss from operation narrowed to 0.96% of net revenues as compared to 2.22% in the same quarter of last year. We are also pleased to report positive operating cash flow for the second consecutive quarter.'
Mr. Liu added, 'Despite the disruption from the lockdowns across the country during the year, we managed to achieve net revenues growth at 8.8%, while significantly improving our margin profile. Our gross segment profit for the year increased by 35.2%, which was four times of our revenue growth rate. Gross segment margin for the year improved to 6.2% as compared to 5.0% last year. In addition, we continued to improve our operation efficiency. Our total sales and marketing expenses, G&A expenses and technology expenses, excluding share-based compensation, decreased by 15.5% year over year. As a result, on a full year basis, our Non-GAAP loss from operations as a percentage of net revenues decreased to 1.6% from 4.0% last year.'
'This result came from our consistent strategy to put our customers first and focus on creating value for them. We continue to strengthen our partnerships with pharmaceutical companies. Our market coverage from both upstream and downstream is increasing and customer loyalty continues to grow. We believe that we have achieved our initial strategic target since IPO, which is to rapidly build up suppliers and customers network with competitive pricing in order to achieve reasonable scale to compete in this market. We are now directly working with 500+ pharmaceutical companies and serving more than 435,000 retail pharmacies. Our revenue scale had rapidly increased 14 times in five years from RMB959 million in 2017 to RMB13.5 billion in 2022.'
'We believe that our efforts to achieve margin expansion, as well as to optimize our cost and improve our organizational alignment, have delivered positive results. We reached profitability at Non-GAAP operating income level in the month of December 2022. We are confident that our strong technology capabilities will continue to enable us to build scale, improve efficiency, and deliver profitability, maximizing values for our shareholders.'
Fourth Quarter 2022 Financial Results
Net revenues were RMB4.1 billion (US$601.4 million), representing an increase of 19.9% from RMB3.5 billion in the same quarter of last year.
See full results at: https://ir.111.com.cn/2023-03-23-111,-Inc-Announces-Fourth-Quarter-and-Fiscal-Year-2022-Financial-Results
For more information on 111, please visit: http://ir.111.com.cn/.
For more information, please contact:
111, Inc.
Investor Relations
Email: ir@111.com.cn
111, Inc.
Media Relations
Email: press@111.com.cn
Phone: +86-021-2053 6666 (China)
111, INC. 
