Jiayuan Announces Third Quarter 2013 Financial Results

            Jiayuan Announces Third Quarter 2013 Financial Results

PR Newswire

BEIJING, Nov. 20, 2013

BEIJING, Nov. 20, 2013 /PRNewswire-FirstCall/ -- Jiayuan.com International
Ltd. ("Jiayuan" or the "Company") (NASDAQ: DATE), operator of the largest
online dating platform in China, today announced its unaudited financial
results for the third quarter ended September 30, 2013.

Third Quarter 2013 Highlights^[1]

  oNet revenues for the third quarter 2013 were RMB128.7 million (US$21.0
    million), representing a year-over-year increase of 13.4% and a sequential
    increase of 7.9%.
  oOperating income for the third quarter 2013 was RMB14.4 million (US$2.3
    million), a decline of 14.1% compared to RMB16.7 million for the
    corresponding quarter of 2012, and an increase of 15.0% compared to
    RMB12.5 million for the previous quarter. Excluding share-based
    compensation, non-GAAP^[2] operating income for the third quarter 2013 was
    RMB16.9 million (US$2.8 million), compared to non-GAAP operating income of
    RMB21.0 million for the corresponding quarter of 2012, representing a
    year-over-year decrease of 19.3% and an increase of 6.0% compared to
    RMB16.0 million for the previous quarter.
  oNet income for the third quarter 2013 was RMB17.6 million (US$2.9
    million), an increase of 10.7% compared to RMB15.9 million for the
    corresponding quarter of 2012, and an increase of 35.1% compared to
    RMB13.1 million for the previous quarter. Excluding share-based
    compensation, non-GAAP net income for the third quarter of 2013 was
    RMB20.2 million (US$3.3 million), flat compared to RMB20.2 million for the
    corresponding quarter of 2012, and an increase of 22.2% compared to
    RMB16.5 million for the previous quarter.

"We were pleased to see solid results in the third quarter with net revenues
increasing 13.4% year-over-year," said Mr. Linguang Wu, CEO of Jiayuan."Our
personalized matchmaking services in particular grew at an exciting pace as we
leveraged China's largest database of marriage minded singles and Jiayuan's
proprietary new CRM system to expand services to additional tier two cities."

"We're also excited to see 3.5% year-over-year growth in our average monthly
active users in the third quarter. Both jiayuan.com and izhenxin.com
contributed to the positive growth, partly due to cross promotional efforts
that helped to increase user engagement on both platforms," added Mr. Wu.
"Executing on our segmentation strategy, we recently launched three new mobile
products which complement our existing product portfolio. We are confident
that our strategy of providing multi-brand, multi-segment products, especially
mobile products, will further strengthen Jiayuan's industry-leading position
over the long term."

"Looking forward, we will be focused on generatinggrowth by introducing new
products targeting specific market segments, expanding our personalized
matchmaking services to new markets, and enhancing existing products to
improve user retention," commented Mr. Shang Koo, CFO of Jiayuan. "In the
quarters ahead we will continue to invest heavily in developing and marketing
new mobile products. Looking to 2014, we expect new mobile products to help
drive user growth."

Third Quarter 2013 Operational Results

The number of average monthly active user accounts^[3] for the third quarter
2013 was 5,428,336, an increase of 3.5% from 5,242,237 in the corresponding
period of 2012 and an increase of 2.0% from 5,321,383 for the previous
quarter.

The number of average monthly paying user accounts^[4] for the third quarter
2013 was 1,368,726, an increase of 7.6% from 1,272,185 in the corresponding
period of 2012 and an increase of 3.2% from 1,326,370 for the previous
quarter.

Average monthly revenue per paying user ("ARPU") for online services for the
third quarter 2013 was RMB25.5, compared to RMB26.5 for the corresponding
period in 2012 and RMB26.6 for the previous quarter.

Third Quarter 2013 Financial Results

Jiayuan reported net revenues of RMB128.7 million (US$21.0 million) for the
third quarter of 2013, representing a year-over-year increase of 13.4% from
RMB113.5 million and an increase of 7.9% from RMB119.3 million in the previous
quarter. This was primarily due to strong growth of personalized matchmaking
services and online services.

  oOnline services contributed RMB108.3 million (US$17.7 million), or 84.2%
    of net revenues for the third quarter of 2013, representing a
    year-over-year increase of 7.1% from RMB101.1 million and an increase of
    2.3% from RMB105.9 million for the previous quarter. The year-over-year
    increase was mainly attributable to the increase in the number of paying
    user accounts.
  oPersonalized matchmaking services and events, previously reported as
    Events and VIP services, contributed RMB19.5 million (US$3.2 million), or
    15.2% of net revenues for the third quarter of 2013, representing a
    year-over-year increase of 61.5% from RMB12.1 million, and an increase of
    51.5% from RMB12.9 million for the previous quarter. Both the
    year-over-year and sequential growth was primarily due to continued
    increase in the number of average monthly personalized matchmaking
    customers served as Jiayuan standardized services, introduced tiered
    pricing, and leveraged its proprietary CRM system.

Cost of revenues for the third quarter of 2013 was RMB45.9 million (US$7.5
million), representing a year-over-year increase of 15.8% from RMB39.6 million
and an increase of 3.4% from RMB44.4 million for the previous quarter. The
year-over-year and sequential increase was primarily due to the expansion of
personalized matchmaking services as well as costs associated with processing
mobile payments as mobile usage continues to rise.

Gross profit  for the third quarter of 2013 was RMB82.8 million (US$13.5
million), representing a year-over-year increase of 12.2% from RMB73.9 million
and an increase of 10.6% from RMB74.9 million for the previous quarter.

Selling and marketing expenses were RMB50.7 million (US$8.3 million) for the
third quarter of 2013, representing a year-over-year increase of 35.2% from
RMB37.5 million and an increase of 13.8% from RMB44.5 million for the previous
quarter. The year-over-year and sequential increase was primarily related to
the higher cost per advertisement and the launch of new mobile products,
including qiu-ai.com.

General and administrative expenses were RMB12.5 million (US$2.0 million) for
the third quarter of 2013, representing a 17.8% year-over-year decrease from
RMB15.2 million and an increase of 0.8% from RMB12.4 million for the previous
quarter. The year-over-year decrease was primarily due to Jiayuan's self-owned
office space and the Company's on-going efforts on cost-control.

Research and development expenses were RMB5.2 million (US$857,000) for the
third quarter of 2013, representing a year-over-year increase of 19.4% from
RMB4.4 million, and a 3.3% decrease from RMB5.4 million for the previous
quarter. The year-over-year increase was primarily due to new product
development in line with the segmentation strategy and the consistent focus on
improving user experience.

Operating income for the third quarter of 2013 was RMB14.4 million (US$2.3
million), representing a decrease of 14.1% from RMB16.7 million for the
corresponding quarter of 2012, and an increase of 15.0% from RMB12.5 million
for the previous quarter. Excluding share-based compensation expenses,
non-GAAP operating income for the third quarter of 2013 was RMB16.9 million
(US$2.8 million), representing a decrease of 19.3% compared to non-GAAP
operating income of RMB21.0 million for the corresponding quarter of 2012 and
an increase of 6.0% compared to non-GAAP operating income of RMB16.0 million
for the previous quarter. The year-over-year decrease was due to higher
selling and marketing expenses as well as R&D expenses in connection with the
segmentation strategy. The sequential increase was a result of growth in the
online business and incremental contribution from personalized matchmaking
services.

Foreign currency exchange net gain for the third quarter of 2013 was
RMB509,000 (US$83,000), compared to a foreign currency exchange net loss of
RMB1.4 million for the corresponding quarter of 2012 and a foreign currency
exchange net gain of RMB675,000 for the previous quarter. The foreign currency
exchange net gain for the third quarter of 2013 was mainly attributable to RMB
appreciation against the U.S. dollar during the period. Part of the proceeds
from Jiayuan's IPO was converted into RMB and is being held by its overseas
entities whose functional currency is the U.S. dollar. 

Net income for the third quarter of 2013 was RMB17.6 million (US$2.9 million),
compared to RMB15.9 million for the corresponding quarter of 2012 and RMB13.1
million for the previous quarter. Excluding share-based compensation expenses,
non-GAAP net income for the third quarter of 2013 was RMB20.2 million (US$3.3
million), compared to RMB20.2 million for the corresponding quarter of 2012
and RMB16.5 million for the previous quarter.

Basic and diluted net income per ADS^[5] for the third quarter of 2013 were
RMB0.59 (US$0.10) and RMB0.57 (US$0.09), respectively, compared to basic and
diluted net income per ADS of RMB0.52 and RMB0.51 for the corresponding
quarter of 2012 and basic and diluted net income per ADS of RMB0.44 and
RMB0.43, respectively, for the second quarter of 2013.

Excluding share-based compensation expenses, non-GAAP basic and diluted net
income per ADS for the third quarter of 2013 were RMB0.67 (US$0.11) and
RMB0.66 (US$0.11), respectively, compared to non-GAAP basic and diluted net
income per ADS of RMB0.66 and RMB0.64 for the corresponding quarter of 2012
and non-GAAP basic and diluted net income per ADS of RMB0.55 and RMB0.54,
respectively, for the second quarter of 2013.

As of September 30, 2013, Jiayuan had cash and cash equivalents and short-term
deposits of RMB541.4 million (US$88.5 million). Cash flows from operating
activities for the third quarter of 2013 were RMB22.2 million (US$3.6
million).

The weighted average number of ADSs outstanding used in calculating diluted
net income per ADS and non-GAAP diluted net income per ADS in the third
quarter of 2013 was 30.8 million. As of September 30, 2013, the Company had
32.7 million ADSs outstanding, including 0.2 million ADSs issued to the
depository for future exercise of options.

Recent Developments

  oJiayuan launched beta testing of Dali (imdali.com) on November 11, 2013.
    Leveraging juedui100.com's user base, Dali is a mobile-centric product
    targeting younger users in the 18 to 25 age bracket. Dali adopts a Q&A
    approach as conversation starters to encourage greater interaction between
    users.
  oJiayuan launched Qiuyuehui on October 30, 2013 after multiple rounds of
    internal testing. Qiuyuehui is an e-commerce app designed for pre-packaged
    1-on-1 dinner dates and for sending gifts. The platform combines the value
    of Jiayuan's industry expertise in finding potential matches for users
    with the added comfort of Jiayuan-verified locations to help ensure a safe
    dating environment.
  oJiayuan launched qiu-ai.com, an html-based mobile dating platform tailored
    to feature phone users, on September 23, 2013.

Fourth Quarter 2013 Outlook

Jiayuan currently expects to generate net revenues in the range of RMB128
million to RMB130 million for the fourth quarter of 2013. This forecast
reflects Jiayuan's current and preliminary view, which is subject to change.

Conference Call Information

Jiayuan's management will host a conference call to discuss its results and
outlook today, November 20, 2013, at 8:00 p.m. U.S. Eastern Time (9:00 a.m.
November 21, 2013 Beijing/Hong Kong Time).

Dial-in details for the earnings conference call are as follows:

United States:                    +1-845-6750-438
United States (Toll-free):        +1-855-5008-701
Hong Kong:                       +852-3051-2745
China:                           400-1200-654
International/All other regions: +65-6723-9385 
Passcode:                        97377546

A replay of the conference call may be accessed by phone at the following
number until November 27, 2013:

International: +61-2-8199-0299
Passcode:      97377546

A live and archived webcast of the conference call will be available at
http://ir.jiayuan.com.

About Jiayuan

Jiayuan.com International Ltd. ("Jiayuan") (NASDAQ: DATE) operates the largest
online dating platform in China. Jiayuan is committed to providing a trusted,
effective, and user-focused online dating platform that addresses the dating
and marriage needs of China's rapidly growing urban singles population. As a
pioneer in China's online dating market, Jiayuan ranks first in terms of
number of unique visitors, average time spent per user and average page views
per user among all online dating websites in China in 2012, according to
iResearch. Jiayuan recorded an average of 5.4 million monthly active user
accounts in the third quarter of 2013. Every two of Jiayuan's American
Depositary Shares represent three ordinary shares.

For more information, please visit http://ir.jiayuan.com.

Forward-Looking Statements

This press release contains forward-looking statements. These statements are
made under the "safe harbor" provisions of the U.S. Private Securities
Litigation Reform Act of 1995. These forward-looking statements can be
identified by terminology such as "will," "expects," "anticipates," "future,"
"intends," "plans," "believes," "estimates," "confident" and similar
statements. Jiayuan may also make written or verbal forward-looking statements
in its periodic reports to the U.S. Securities and Exchange Commission, in its
annual report to shareholders, in press releases and other written materials
and in verbal statements made by its officers, directors or employees to third
parties. Statements that are not historical facts, including statements about
our beliefs and expectations, are forward-looking statements. Forward-looking
statements involve inherent risks and uncertainties. A number of factors could
cause actual results to differ materially from those contained in any
forward-looking statement, including but not limited to the following: our
growth strategies; our future business development, including development of
new products and services; our ability to attract and retain users;
competition in the Chinese online dating markets; changes in our revenues and
certain cost or expense items as a percentage of our revenues; the outcome of
any litigation or arbitration; the expected growth of the number of Internet
and broadband users in China; Chinese governmental policies relating to the
Internet and online dating websites and general economic conditions in China
and elsewhere. Further information regarding these and other risks is included
in our documents filed with the U.S. Securities and Exchange Commission.
Jiayuan does not undertake any obligation to update any forward-looking
statement, except as required under applicable law. All information provided
in this press release is as of the date of the press release, and Jiayuan
undertakes no duty to update such information, except as required under
applicable law.

Non-GAAP Financial Measures

We disclose non-GAAP financial measures of operating income, net income and
net income per ADS, each of which is adjusted to exclude share-based
compensation expense. We review non-GAAP financial measures to obtain an
additional understanding of our operating performance. We also believe it is
useful supplemental information for investors and analysts to assess our
operating performance without the effect of non-cash share-based compensation
expense, which have been and will continue to be significant recurring
expenses in our business. For a reconciliation of each of these non-GAAP
financial measures to the most directly comparable GAAP financial measures,
please see "Reconciliation To Unaudited Condensed Consolidated Statement of
Comprehensive Income" included in this press release.

However, the use of non-GAAP financial measures has material limitations as an
analytical tool. One of the limitations of using non-GAAP financial measures
is that it does not include all items that impact our non-GAAP financial
measures during the period. In addition, because non-GAAP financial measures
are not calculated in the same manner by all companies, it may not be
comparable to other similar titled measures used by other companies. In light
of the foregoing limitations, you should not consider non-GAAP financial
measures in isolation from or as an alternative to GAAP financial measures.
Management compensates for this limitation by providing specific information
regarding the GAAP amount excluded from the non-GAAP measure.

    This announcement contains translations of certain Renminbi ("RMB")
    amounts into U.S. dollar ("US$") amounts at specified rates solely for the
    convenience of readers. Unless otherwise noted, all translations from RMB
[1] amounts into US$ amounts as of and for the quarter ended September 30,
    2013, were made at an exchange rate of RMB6.1200 to US$1.00, representing
    the rate as certified by the H.10 weekly statistical release of the
    Federal Reserve Board on September 30, 2013. Jiayuan's functional currency
    is U.S. dollar and reporting currency is RMB.
    Explanation of Jiayuan's non-GAAP financial measures and related
[2] reconciliations to GAAP financial measures are included in the
    accompanying "Non-GAAP Financial Measures'' and "Reconciliations to
    Unaudited Condensed Consolidated Statements of Comprehensive Income".
    Active user accounts are registered user accounts through which registered
    users have logged in to the Jiayuan platforms at least once within a
    calendar month, in the case of user accounts registered in prior months,
    or on at least two separate days within a calendar month, including the
[3] day of completion of the registration process, in the case of user
    accounts newly registered in the calendar month. In the third quarter of
    2013, average monthly active user accounts include active user accounts
    with Jiayuan.com, izhenxin.com, and juedui100.com for the full three
    months and qiu-ai.com for eight days.
    In the third quarter of 2013, average monthly paying user accounts include
[4] paying user accounts with Jiayuan.com, izhenxin.com, and juedui100.com for
    the full three months and qiu-ai.com for eight days.
    Basic and diluted net income per ADS are calculated based on net income
[5] attributable to ordinary shareholders and the corresponding basic and
    diluted number of ADSs, assuming that, during each period presented, every
    two ADSs represent three ordinary shares of Jiayuan.

For investor and media inquiries, please contact:

Beijing

Shirley Zhang
Jiayuan.com International Ltd.
+86 (10) 6442-2321
ir@jiayuan.com

Yue Yu
Brunswick Group LLP
+86 (10) 5960-8600
jiayuan@brunswickgroup.com

New York

Cindy Zheng
Brunswick Group LLP
+1 (212) 333-3810
jiayuan@brunswickgroup.com



JIAYUAN.COM INTERNATIONAL LTD.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
                                                September30,  June30,  September30,
                                                2012           2013      2013      2013
                                                RMB            RMB       RMB       US$
ASSETS
Current assets:
Cash and cash equivalents                       433,507        434,583   233,412   38,139
Short-term deposits                             159,035        76,443    307,980   50,324
Term deposits, current portion                  10,000         10,000    -         -
Available-for-sale securities                   5,010          5,128     5,175     846
Accounts receivable, net                        28,306         35,328    39,942    6,526
Deferred tax assets                             3,095          4,613     3,729     609
Prepaidexpensesandothercurrentassets       23,269         18,066    19,419    3,173
Total current assets                            662,222        584,161   609,657   99,617
Non-current assets:
Prepaid expenses and other
                                                3,000          -         -         -
receivable – non-current portion
 Property and equipment, net                   23,198         102,030   102,417   16,735
 Intangible assets, net                        -              4,288     4,129     675
 Goodwill                                      -              789       789       129
Total assets                                    688,420        691,268   716,992   117,156
LIABILITIES
Current liabilities:
Deferred revenue, current portion               103,363        120,693   123,335   20,153
Accounts payable                                107            785       201       33
Accruedexpensesandothercurrentliabilities  28,355         35,277    32,821    5,363
Income tax payable                              13,282         20,544    22,613    3,695
Total current liabilities                       145,107        177,299   178,970   29,244
Non-current liabilities:
 Deferred revenue, non-current portion         1,103          725       1,033     169
 Deferred tax liabilities                      -              1,770     2,999     490

                                                146,210        179,794   183,002   29,903
Total liabilities
SHAREHOLDERS' EQUITY
Ordinary shares                                 343            347       349       57
Additional paid-in capital                      531,252        498,800   505,845   82,654
Less:Treasury shares                            (44,064)       (71,740)  (72,864)  (11,906)
Statutory reserves                              5,792          9,502     9,502     1,553
Retained earnings                               49,656         84,179    101,817   16,636
Accumulated other comprehensive loss            (769)          (9,614)   (10,659)  (1,741)
Total shareholders' equity                      542,210        511,474   533,990   87,253
Total liabilities and shareholders' equity      688,420        691,268   716,992   117,156



JIAYUAN.COM INTERNATIONAL LTD.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
                                  Three months ended,
                                  September30,2012  June30,2013  September30,2013
                                  RMB                 RMB            RMB         US$
Net revenues                      113,489             119,270        128,729     21,033
Cost of revenues                  (39,629)            (44,384)       (45,894)    (7,499)
Gross profit                      73,860              74,886         82,835      13,534
Operating expenses:
Sellingandmarketingexpenses    (37,495)            (44,523)       (50,689)    (8,283)
General and administrative
                                  (15,247)            (12,444)       (12,538)    (2,049)
expenses
Research and development
                                  (4,393)             (5,425)        (5,245)     (857)
expenses
Total operating expenses          (57,135)            (62,392)       (68,472)    (11,189)
Operating income                  16,725              12,494         14,363      2,345
Interest income, net              3,442               2,459          3,061       500
Foreigncurrencyexchangegain,
                                  (1,422)             675            509         83
net
Other(expenses) /income, net      (179)               1,501          3,888       635
Income before income tax          18,566              17,129         21,821      3,563
Income tax expenses               (2,632)             (4,069)        (4,183)     (683)
Net income                        15,934              13,060         17,638      2,880
Net income per ADS – Basic        0.52                0.44           0.59        0.10
Net income per ADS – Diluted      0.51                0.43           0.57        0.09
ADSsusedincomputingbasicnet
                                  30,765,750          29,856,349     30,022,164  30,022,164
income per ADS
ADSs used in computing diluted
                                  31,443,850          30,475,950     30,757,601  30,757,601
net income per ADS



JIAYUAN.COM INTERNATIONAL LTD.
RECONCILIATIONS TO UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(IN RMB THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
                                  Three Months Ended September 30, 2012    Three Months Ended June 30, 2013         Three Months Ended September 30, 2013
                                  GAAP        Non-GAAP        Non-GAAP     GAAP        Non-GAAP        Non-GAAP      GAAP        Non-GAAP        Non-GAAP
                                              Adjustment(a)                           Adjustment(a)                            Adjustment(a)
Operating income                  16,725      4,260           20,985       12,494      3,473           15,967        14,363      2,566           16,929
Net income                        15,934      4,260           20,194       13,060      3,473           16,533        17,638      2,566           20,204
Basic net income per ADS          0.52                        0.66         0.44                        0.55          0.59                        0.67
Diluted net income per ADS        0.51                        0.64         0.43                        0.54          0.57                        0.66
ADSsusedincomputingbasicnet
                                  30,765,750                  30,765,750   29,856,349                  29,856,349    30,022,164                  30,022,164
income per ADS
ADSs used in computing diluted
                                  31,443,850                  31,443,850   30,475,950                  30,475,950    30,757,601                  30,757,601
net income per ADS
Note:
(a) To adjust for share-based compensation expense.

SOURCE Jiayuan.com International Ltd.

Website: http://www.Jiayuan.com
Website: http://imdali.com
Website: http://ir.jiayuan.com
 
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