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RERE.US Corporate Blog – March 2022
Below is a summary of the recent business development of the Company and the industry headlines in March 2022. Regarding the operational metrics, please refer to the Company’s quarterly earnings release and its filings with the U.S. SEC.
Operational update
The COVID pandemic re-occurred in multiple cities in March, including Shenzhen, Shanghai, and Shenyang, etc. Although some of the regional AHS stores were temporarily shut down in response to municipal requirements, AHS Recycle in other regions and online kept business as usual with high-standard services. This is safely done through pick-up for online orders and safe social distancing in-store fulfillment.
During the recurrences of the COVID, our operation facility strictly adhered to the anti-pandemic requirements of local authorities. We ensure a safe workplace through disinfection of the operation centers three times every day, sanitizing the parcels upon arrival, and checking body temperature and health QR code of our staff on a daily basis. We also leverage our big-data system and direct orders to nearby city-level operation stations to minimize adverse impact on regional operation capability.
In March, ATRenew added 16 new city-level service stations to its operational network, further burgeoning used electronics markets locally in south and southwest China.
In December 2021, ATRenew started a pilot program named “cloud storage”, “云仓” in Chinese, to cover local electronics marketplaces in Suzhou and Shenzhen as a part of the Company’s city-level service integration strategy. It enhances transactions across local markets by leveraging the Company’s inspection capabilities. With Device Hero, a power bank sized inspection device, small POP merchants are able to easily recycle and circulate electronic products. As of the end of March 2022, this pilot program covered 60 cities in China and contributed to the GMV growth of local markets.
Key highlights
Released 4Q21 and FY21 financial results with a quarterly operating income
On March 10, ATRenew reported its beyond-expectation quarterly financial results as the topline beat guidance to over RMB2.4 billion, an increase of 48.2% year-on-year, while highlighting a non-GAAP operation profit of RMB9.7 million. In 2021, total net revenues, GMV and number of transactions increased by 60.1%, 65.8% and 32.2% year-on-year to RMB7.8 billion, RMB32.5 billion and 31.2 million, respectively. The company had sufficient cash on hand by the end of 2021.
Initiated 2021 ESG review and reporting program
In March, assisted by Miotech, ATRenew regathered its annual ESG reporting working group to conduct a yearly review on its ESG performance, benchmarking the GRI standards. The company also quantifies its carbon impact of recycling and remarketing used electronic products. Material topics of this year include responsible recycling of pre-owned electronic devices, data security and privacy protection, as well as safe working conditions and career development for staff during COVID era.
Industry news
China Central Television Finance Channel reports a burgeoning recycling and trade-in market
On April 5, CCTV-2, the finance channel operated by China Central Television, reported that recycling and trade-in services became essential in China’s pre-owned phone market (video link). Through continuous education, the action of giving a second life to idle phones obtained popularity among Chinese consumers. By incorporating online pricing and offline recycling services, e-commerce platforms and service platforms boost the expansion of the recycling rate. According to an estimate by the China Association of Electronics Equipments For Technology Development, the penetration of phones in China was about 1.9 billion in 2021, and the number of idle phones could total 6 billion from 2021 to 2025.