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): August 4, 2016
MercadoLibre, Inc.
(Exact Name of Registrant as Specified in Charter)
Delaware | 001-33647 | 98-0212790 |
(State or Other Jurisdiction of Incorporation) | (Commission File Number) | (I.R.S. Employer Identification Number) |
Arias 3751, 7th Floor, Buenos Aires, Argentina C1430CRG |
(Address of Principal Executive Offices) (Zip Code) |
011-54-11-4640-8000
(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)) |
Item 2.02. Results of Operations and Financial Condition.
On August 4, 2016, 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 99.1. Press release dated August 4, 2016
SIGNATURE
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 hereunto duly authorized.
MercadoLibre, Inc. | ||
Date: August 4, 2016 | By: | /s/ PEDRO ARNT |
PEDRO ARNT | ||
Chief Financial Officer | ||
EXHIBIT 99.1
MercadoLibre, Inc. Reports Second Quarter 2016 Financial Results
43.7 million Sold Items, up 45%, 31.9 million Total Payment Transactions, up 76%
Net Revenues of $199.6 million, growing 29% in USD, 73% in local currencies
Net Income of $15.9 million, resulting in EPS of $0.36.
BUENOS AIRES, Argentina, Aug. 04, 2016 (GLOBE NEWSWIRE) -- MercadoLibre, Inc. (Nasdaq:MELI) (http://www.mercadolibre.com), Latin America's leading e-commerce technology company, today reported financial results for the three month period ended June 30, 2016.
Pedro Arnt, Chief Financial Officer of Mercado Libre, Inc., commented, “The second quarter of 2016 was one of our strongest quarters ever. Not only have we maintained high growth rates on key operational and financial metrics by executing well, but we are also pleased to report that our enhanced marketplace vision continues to consolidate in our larger markets, and, perhaps more importantly, is starting to materialize outside of those main geographies.”
Second Quarter 2016 Business Highlights
Materializing our enhanced marketplace vision through successful execution
Second Quarter 2016 Financial Highlights
(*) See note on “Non-GAAP Financial Measures”
Second Quarter 2016 Corporate Highlights
The following table summarizes certain key performance metrics for the three months ended June 30, 2016 and 2015.
Three months ended June 30, (in MM) | |||||||||||||
%YoY Local | |||||||||||||
2016 | 2015 | %YoY | Currency | ||||||||||
Total confirmed registered users at the end of period | 158.6 | 132.3 | 19.9 | % | - | ||||||||
New confirmed registered users during the period | 7.1 | 5.6 | 27.2 | % | - | ||||||||
Gross merchandise volume | $ | 2,004.7 | $ | 1,653.5 | 21.2 | % | 67.7 | % | |||||
Items sold | 43.7 | 30.2 | 44.7 | % | - | ||||||||
SI Shipped | 20.3 | 10.0 | 104 | % | |||||||||
Total payment volume | $ | 1,816.9 | $ | 1,206.0 | 50.6 | % | 101.6 | % | |||||
Total payment transactions | 31.9 | 18.1 | 76.0 | % | - | ||||||||
Table of Year-on-Year Local Currency Revenue Growth Rates by Quarter
YoY Growth rates | ||||||||||||||||
Consolidated Net Revenues | ||||||||||||||||
Q2'15 | Q3'15 | Q4'15 | Q1'16 | Q2'16 | ||||||||||||
Brazil | 58 | % | 47 | % | 42 | % | 54 | % | 61 | % | ||||||
Argentina | 90 | % | 83 | % | 79 | % | 71 | % | 89 | % | ||||||
Mexico | 26 | % | 26 | % | 29 | % | 42 | % | 35 | % | ||||||
Ven | 284 | % | 281 | % | 272 | % | 249 | % | 185 | % | ||||||
Others | 12 | % | 3 | % | 14 | % | 19 | % | 30 | % | ||||||
Total | 88 | % | 68 | % | 69 | % | 75 | % | 73 | % | ||||||
Table of Year-on-Year USD Revenue Growth Rates by Quarter
YoY Growth rates | |||||||||||||||
Consolidated Net Revenues | |||||||||||||||
Q2'15 | Q3'15 | Q4'15 | Q1'16 | Q2'16 | |||||||||||
Brazil | 15 | % | -5 | % | -6 | % | 13 | % | 41 | % | |||||
Argentina | 71 | % | 64 | % | 52 | % | 2 | % | 19 | % | |||||
Mexico | 7 | % | 0 | % | 6 | % | 18 | % | 15 | % | |||||
Ven | -65 | % | -4 | % | -7 | % | -13 | % | 31 | % | |||||
Others | -4 | % | -13 | % | -8 | % | -1 | % | 14 | % | |||||
Total | 17 | % | 14 | % | 12 | % | 6 | % | 29 | % | |||||
Conference Call and Webcast
The Company will host a conference call and audio webcast on August 4, 2016 at 4:30 p.m. Eastern Time. The conference call may be accessed by dialing +(970) 315-0420 or +(877) 303-7209 (Conference ID 53806354) and requesting inclusion in the call for Mercado Libre. 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.
Definition of Selected Operational Metrics
Blended tax rate – Defined as income and asset tax expense as a percentage of income before income and assets tax.
Excluding Venezuela – Given the current currency distortions and hyperinflation present in Venezuela, the Company’s growth data disclosed above excludes the impact of the results of operations from its Venezuelan subsidiaries. The disclosure of this data enables investors to evaluate the company’s operating performance from period to period without the distortions caused by Venezuela’s hyperinflation and foreign exchange policies.
Free Cash Flow – Defined as cash flows from operating activities less payment and advances for the acquisition of property, equipment, intangible assets net of financial liabilities and payment for acquired business net of cash acquired.
Foreign Exchange (“FX”) Neutral – Calculated by using the average monthly exchange rate of each month of 2015 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 motor vehicles, vessels, aircraft, real estate, and services.
Items sold – Measure of the number of items sold/purchased through the Mercado Libre Marketplace.
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 platform (including Mercado Pago) and confirmed their registration. Since July’12, registration and confirmation take place in the same step of the registration flow.
Operating margin – Defined as income from operations as a percentage of net revenues.
Total confirmed registered users – Measure of the cumulative number of users who have registered on the Mercado Libre platform (including Mercado Pago) and confirmed their registration. Since July ’12, registration and confirmation take place in the same step of the registration flow.
Total payment transactions – Measure of the number of all transactions completed using MercadoPago.
Total payment volume – Measure of total U.S. dollar sum of all transactions paid for using MercadoPago.
About Mercado Libre
Founded in 1999, Mercado Libre is Latin America's leading e-commerce technology company. Through its primary platforms, Mercado Libre.com and Mercado Pago.com, it provides solutions to individuals and companies buying, selling, advertising, and paying for goods and services online.
Mercado Libre.com serves millions of users and creates a market for a wide variety of goods and services in an easy, safe and efficient way. The site is among the top 50 in the world in terms of page views and is the leading retail platform in unique visitors in the major countries in which it operates according to metrics provided by comScore Networks. 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 Mercado Libre, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=4193
Consolidated balance sheets
June 30, | December 31, | ||||||
2016 | 2015 | ||||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 144,016 | $ | 166,881 | |||
Short-term investments | 251,416 | 202,112 | |||||
Accounts receivable, net | 40,055 | 28,428 | |||||
Credit cards receivables, net | 215,437 | 131,946 | |||||
Prepaid expenses | 6,004 | 6,007 | |||||
Inventory | 990 | 222 | |||||
Other assets | 15,349 | 9,577 | |||||
Total current assets | 673,267 | 545,173 | |||||
Non-current assets: | |||||||
Long-term investments | 157,832 | 187,621 | |||||
Property and equipment, net | 104,808 | 81,633 | |||||
Goodwill | 96,150 | 86,545 | |||||
Intangible assets, net | 29,126 | 28,991 | |||||
Deferred tax assets | 36,417 | 29,688 | |||||
Other assets | 42,549 | 43,955 | |||||
Total non-current assets | 466,882 | 458,433 | |||||
Total assets | $ | 1,140,149 | $ | 1,003,606 | |||
Liabilities and Equity | |||||||
Current liabilities: | |||||||
Accounts payable and accrued expenses | $ | 86,068 | $ | 62,038 | |||
Funds payable to customers | 277,528 | 203,247 | |||||
Salaries and social security payable | 32,786 | 32,918 | |||||
Taxes payable | 16,419 | 10,092 | |||||
Loans payable and other financial liabilities | 782 | 1,965 | |||||
Other liabilities | 2,148 | 7,667 | |||||
Dividends payable | 6,624 | 4,548 | |||||
Total current liabilities | 422,355 | 322,475 | |||||
Non-current liabilities: | |||||||
Salaries and social security payable | 10,239 | 10,422 | |||||
Loans payable and other financial liabilities | 296,691 | 294,342 | |||||
Deferred tax liabilities | 32,099 | 27,049 | |||||
Other liabilities | 14,198 | 9,860 | |||||
Total non-current liabilities | 353,227 | 341,673 | |||||
Total liabilities | $ | 775,582 | $ | 664,148 | |||
Equity: | |||||||
Common stock, $0.001 par value, 110,000,000 shares authorized, | |||||||
44,157,341 and 44,156,854 shares issued and outstanding at June 30, | |||||||
2016 and December 31, 2015, respectively | $ | 44 | $ | 44 | |||
Additional paid-in capital | 137,979 | 137,923 | |||||
Retained earnings | 473,627 | 440,770 | |||||
Accumulated other comprehensive loss | (247,083 | ) | (239,279 | ) | |||
Total Equity | 364,567 | 339,458 | |||||
Total Liabilities and Equity | $ | 1,140,149 | $ | 1,003,606 | |||
Consolidated statements of income
Six Months Ended June 30, | Three Months Ended June 30, | ||||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||||
(In thousands) | (In thousands) | ||||||||||||||||
Net revenues | $ | 357,274 | $ | 302,417 | $ | 199,644 | $ | 154,314 | |||||||||
Cost of net revenues | (128,794 | ) | (95,019 | ) | (73,346 | ) | (50,311 | ) | |||||||||
Gross profit | 228,480 | 207,398 | 126,298 | 104,003 | |||||||||||||
Operating expenses: | |||||||||||||||||
Product and technology development | (46,157 | ) | (36,885 | ) | (24,216 | ) | (19,639 | ) | |||||||||
Sales and marketing | (68,020 | ) | (55,317 | ) | (35,337 | ) | (29,115 | ) | |||||||||
General and administrative | (37,910 | ) | (38,746 | ) | (20,841 | ) | (20,612 | ) | |||||||||
Impairment of Long-Lived Assets | (13,717 | ) | (16,226 | ) | (13,717 | ) | — | ||||||||||
Total operating expenses | (165,804 | ) | (147,174 | ) | (94,111 | ) | (69,366 | ) | |||||||||
Income from operations | 62,676 | 60,224 | 32,187 | 34,637 | |||||||||||||
Other income (expenses): | |||||||||||||||||
Interest income and other financial gains | 15,300 | 8,991 | 8,049 | 4,683 | |||||||||||||
Interest expense and other financial losses | (12,315 | ) | (10,151 | ) | (6,631 | ) | (5,201 | ) | |||||||||
Foreign currency losses | (240 | ) | (9,217 | ) | (5,387 | ) | (648 | ) | |||||||||
Net income before income / asset tax expense | 65,421 | 49,847 | 28,218 | 33,471 | |||||||||||||
Income / asset tax expense | (19,316 | ) | (28,663 | ) | (12,360 | ) | (14,008 | ) | |||||||||
Net income | $ | 46,105 | $ | 21,184 | $ | 15,858 | $ | 19,463 |
Six Months Ended June 30, | Three Months Ended June 30, | ||||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||||
Basic EPS | |||||||||||||||||
Basic net income | |||||||||||||||||
Shareholders per common share | $ | 1.04 | $ | 0.48 | $ | 0.36 | $ | 0.44 | |||||||||
Weighted average of outstanding common shares | 44,157,151 | 44,155,035 | 44,157,341 | 44,155,271 | |||||||||||||
Diluted EPS | |||||||||||||||||
Diluted net income | |||||||||||||||||
Shareholders per common share | $ | 1.04 | $ | 0.48 | $ | 0.36 | $ | 0.44 | |||||||||
Weighted average of outstanding common shares | 44,157,151 | 44,155,035 | 44,157,341 | 44,155,271 | |||||||||||||
Cash Dividends declared | 0.150 | 0.206 | 0.150 | 0.103 | |||||||||||||
Consolidated statements of cash flows
Six Months Ended June 30, | ||||||||
2016 | 2015 | |||||||
Cash flows from operations: | ||||||||
Net income | $ | 46,105 | $ | 21,184 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Unrealized Devaluation Loss, net | 5,162 | 10,862 | ||||||
Impairment of Long-Lived Assets | 13,717 | 16,226 | ||||||
Depreciation and amortization | 13,178 | 10,970 | ||||||
Accrued interest | (7,918 | ) | (5,769 | ) | ||||
Non cash interest and convertible bonds amortization of debt discount and Amortization of debt issuance costs | 4,705 | 8,562 | ||||||
LTRP accrued compensation | 10,126 | 8,463 | ||||||
Deferred income taxes | (1,981 | ) | 7,736 | |||||
Changes in assets and liabilities: | ||||||||
Accounts receivable | (2,833 | ) | (19,342 | ) | ||||
Credit Card Receivables | (78,334 | ) | (52,553 | ) | ||||
Prepaid expenses | 9 | (2,327 | ) | |||||
Inventory | (637 | ) | — | |||||
Other assets | (7,704 | ) | (4,122 | ) | ||||
Accounts payable and accrued expenses | (15,133 | ) | 40,974 | |||||
Funds payable to customers | 59,309 | 52,006 | ||||||
Other liabilities | (566 | ) | (652 | ) | ||||
Interest received from investments | 7,650 | 4,613 | ||||||
Net cash provided by operating activities | 44,855 | 96,831 | ||||||
Cash flows from investing activities: | ||||||||
Purchase of investments | (1,559,095 | ) | (950,636 | ) | ||||
Proceeds from sale and maturity of investments | 1,565,336 | 926,058 | ||||||
Payment for acquired businesses, net of cash acquired | (7,284 | ) | (45,009 | ) | ||||
Purchases of intangible assets | (49 | ) | (1,367 | ) | ||||
Advance for property and equipment | (4,963 | ) | (7,473 | ) | ||||
Purchases of property and equipment | (32,590 | ) | (16,305 | ) | ||||
Net cash used in investing activities | (38,645 | ) | (94,732 | ) | ||||
Cash flows from financing activities: | ||||||||
Payments on loans payable and other financing | (6,299 | ) | (4,438 | ) | ||||
Dividends paid | (11,172 | ) | (11,878 | ) | ||||
Repurchase of Common Stock | — | (2,714 | ) | |||||
Net cash used in financing activities | (17,471 | ) | (19,030 | ) | ||||
Effect of exchange rate changes on cash and cash equivalents | (11,604 | ) | (35,822 | ) | ||||
Net decrease in cash and cash equivalents | (22,865 | ) | (52,753 | ) | ||||
Cash and cash equivalents, beginning of the period | $ | 166,881 | 223,144 | |||||
Cash and cash equivalents, end of the period | $ | 144,016 | $ | 170,391 | ||||
Financial results of reporting segments
Three Months Ended June 30, 2016 | ||||||||||||||||||||||||||||||
Brazil | Argentina | Mexico | Venezuela | Other Countries | Total | |||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||||||
Net revenues | $ | 102,889 | $ | 67,701 | $ | 11,452 | $ | 7,461 | $ | 10,141 | $ | 199,644 | ||||||||||||||||||
Direct costs | (61,462 | ) | (38,446 | ) | (9,200 | ) | (4,094 | ) | (7,138 | ) | (120,340 | ) | ||||||||||||||||||
Impairment of Long-lived Assets | - | - | - | (13,717 | ) | - | (13,717 | ) | ||||||||||||||||||||||
Direct contribution | 41,427 | 29,255 | 2,252 | (10,350 | ) | 3,003 | 65,587 | |||||||||||||||||||||||
Operating expenses and indirect costs of net revenues | (33,400 | ) | ||||||||||||||||||||||||||||
Income from operations | 32,187 | |||||||||||||||||||||||||||||
Other income (expenses): | ||||||||||||||||||||||||||||||
Interest income and other financial gains | 8,049 | |||||||||||||||||||||||||||||
Interest expense and other financial losses | (6,631 | ) | ||||||||||||||||||||||||||||
Foreign currency losses | (5,387 | ) | ||||||||||||||||||||||||||||
Net income before income / asset tax expense | $ | 28,218 | ||||||||||||||||||||||||||||
Three Months Ended June 30, 2015 | ||||||||||||||||||||||||||||||
Brazil | Argentina | Mexico | Venezuela | Other Countries | Total | |||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||||||
Net revenues | $ | 72,867 | $ | 56,830 | $ | 9,991 | $ | 5,714 | $ | 8,912 | $ | 154,314 | ||||||||||||||||||
Direct costs | (43,995 | ) | (29,057 | ) | (6,646 | ) | (2,631 | ) | (5,912 | ) | (88,241 | ) | ||||||||||||||||||
Direct contribution | 28,872 | 27,773 | 3,345 | 3,083 | 3,000 | 66,073 | ||||||||||||||||||||||||
Operating expenses and indirect costs of net revenues | (31,436 | ) | ||||||||||||||||||||||||||||
Income from operations | 34,637 | |||||||||||||||||||||||||||||
Other income (expenses): | ||||||||||||||||||||||||||||||
Interest income and other financial gains | 4,683 | |||||||||||||||||||||||||||||
Interest expense and other financial losses | (5,201 | ) | ||||||||||||||||||||||||||||
Foreign currency loss | (648 | ) | ||||||||||||||||||||||||||||
Net income before income / asset tax expense | $ | 33,471 | ||||||||||||||||||||||||||||
Non-GAAP Financial Measures
To supplement the condensed consolidated financial statements presented in accordance with U.S. GAAP, the Company uses the following non-GAAP measures: free cash flows, foreign exchange neutral measures, and, for the purpose of excluding Venezuela from consolidated results, “Venezuela adjusted measures” including adjusted net income before income / asset tax, adjusted income / asset tax, adjusted net income, adjusted blended tax rate and adjusted earnings per share. These non-GAAP measures 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, these non-GAAP measures are 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 the Company’s results of operations as determined in accordance with U.S. GAAP. These non-GAAP financial measures should only be used to evaluate the Company’s results of operations in conjunction with the most comparable U.S. GAAP financial measures.
Free cash flow provides useful information to both management and investors by excluding payments for the acquisition of property, equipment, of intangible assets net of financial liabilities and of businesses net of cash acquired that may not be indicative of the Company’s core operating results. In addition, free cash flows are reported to investors because the Company believes that the inclusion of this measure provides consistency in the financial reporting. The Company considers free cash flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by the Company’s operations after the purchases of property, and equipment, of intangible assets and of acquired businesses net of cash acquired. A limitation of the utility of free cash flow as a measure of financial performance is that it does not represent the total increase or decrease in the Company’s cash balance for the period.
The following table shows a reconciliation of Operating Cash Flows to Free Cash Flows:
Three-month Periods Ended | |||||||||||||||||||
June 30, | |||||||||||||||||||
(In millions) | 2016 | 2015 | |||||||||||||||||
Net Cash provided by Operating Activities | $ | 56.7 | $ | 58.6 | |||||||||||||||
Payment for acquired business, net of cash acquired | (5.5 | ) | (45.0 | ) | |||||||||||||||
Advance for property and equipment | (4.1 | ) | (7.5 | ) | |||||||||||||||
Purchase of intangible assets | (0.0 | ) | (0.5 | ) | |||||||||||||||
Purchase of property and equipment | (18.0 | ) | (9.0 | ) | |||||||||||||||
Free cash flow | 29.1 | (3.3 | ) | ||||||||||||||||
(*) The table above may not total due to rounding.
The Company believes that FX neutral measures compared with the most directly GAAP measure provides investors a better understanding of the current financial performance of our business excluding the FX impact in each line of our P&L. Specifically, the Company believes these non-GAAP measures 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 following table sets forth the FX neutral measures related to our reported results of the operations for the three-month period ended June 30, 2016:
Three-months Periods Ended June 30, (*) | ||||||||||||||||||||||||
As reported | FX Neutral Measures | |||||||||||||||||||||||
(In millions, except percentages) | 2016 | 2015 | Percentage Change | 2016 | 2015 | Percentage Change | ||||||||||||||||||
Net revenues | $ | 199.6 | $ | 154.3 | 29.4 | % | $ | 266.2 | $ | 154.3 | 72.5 | % | ||||||||||||
Cost of net revenues | (73.3 | ) | (50.3 | ) | 45.7 | % | (97.5 | ) | (50.3 | ) | 93.7 | % | ||||||||||||
Gross profit | 126.3 | 104.0 | 21.5 | % | 168.8 | 104.0 | 62.3 | % | ||||||||||||||||
Operating expenses: | (80.4 | ) | (69.4 | ) | 15.9 | % | (135.8 | ) | (69.4 | ) | 95.8 | % | ||||||||||||
Impairment of Long-Lived Assets | (13.7 | ) | — | -100.0 | % | (13.7 | ) | — | -100.0 | % | ||||||||||||||
Total operating expenses | (94.1 | ) | (69.4 | ) | 35.7 | % | (149.5 | ) | (69.4 | ) | 115.5 | % | ||||||||||||
Income from operations | 32.2 | 34.6 | -7.1 | % | 19.3 | 34.6 | -44.4 | % | ||||||||||||||||
(*) The table above may not total due to rounding.
Moreover, the Company believes that the Venezuela adjusted measures provide useful information to both management and investors by excluding the foreign exchange loss attributable to the devaluation in Venezuela and the impairment of long-lived assets, because it may not be indicative of the ordinary course of our business. In addition, the Venezuela adjusted measures are reported to investors to provide consistency in the Company’s financial reporting and because these financial measures provide useful information to management and investors about what the Venezuela adjusted measures, would have been, had the foreign exchange loss in Venezuela and the impairment of long-lived assets not occurred. A limitation of the utility of the Venezuela measures, as measures of financial performance is that they do not represent the total foreign exchange effect in the Income Statement for the periods presented:
Six-month period ended (**) | Three-month period ended (**) | ||||||||||||||||||||||||||
June 30, 2016 | June 30, 2015 | June 30, 2016 | June 30, 2015 | ||||||||||||||||||||||||
Net income before income / asset tax expense | $ | 65.4 | $ | 49.8 | $ | 28.2 | $ | 33.5 | |||||||||||||||||||
Devaluation loss in Venezuela | 7.2 | 20.4 | 4.9 | — | |||||||||||||||||||||||
Impairment of long-lived assets in Venezuela | 13.7 | 16.2 | 13.7 | — | |||||||||||||||||||||||
Adjusted Net income before income / asset tax expense | $ | 86.3 | $ | 86.5 | $ | 46.8 | $ | 33.5 | |||||||||||||||||||
Income and asset tax expense | $ | (19.3 | ) | $ | (28.7 | ) | $ | (12.4 | ) | $ | (14.0 | ) | |||||||||||||||
Income tax effect on devaluation loss in Venezuela | (4.8 | ) | (3.8 | ) | (1.7 | ) | — | (1 | ) | ||||||||||||||||||
Adjusted Income and asset tax | $ | (24.1 | ) | $ | (32.5 | ) | $ | (14.1 | ) | $ | (14.0 | ) | |||||||||||||||
Net Income | $ | 46.1 | $ | 21.2 | $ | 15.9 | $ | 19.5 | |||||||||||||||||||
Devaluation loss in Venezuela | 7.2 | 20.4 | 4.9 | — | |||||||||||||||||||||||
Impairment of long-lived assets in Venezuela | 13.7 | 16.2 | 13.7 | — | |||||||||||||||||||||||
Income tax effect on devaluation loss in Venezuela | (4.8 | ) | (3.8 | ) | (1.7 | ) | — | (1 | ) | ||||||||||||||||||
Adjusted Net Income | $ | 62.2 | $ | 54.0 | $ | 32.7 | $ | 19.5 | |||||||||||||||||||
Weighted average of outstanding common shares | 44,157,151 | 44,155,035 | 44,157,341 | 44,155,271 | |||||||||||||||||||||||
Adjusted Earnings per share | $ | 1.41 | $ | 1.22 | $ | 0.74 | $ | 0.44 | |||||||||||||||||||
Adjusted Blended Tax Rate (2) | 28.0 | % | 37.5 | % | 30.1 | % | 41.9 | % | |||||||||||||||||||
(**) Stated in millions of U.S. dollars, except for share data. The table above may not total due to rounding.
(1) Income tax charge related to the Venezuela devaluation under local tax regulations. | |||||
(2) Adjusted Income and asset tax over Adjusted Net income before income / asset tax expense. |
CONTACT:
MercadoLibre, Inc.
Investor Relations
investor@mercadolibre.com
http://investor.mercadolibre.com