Boqii Announces Fiscal 2022 First Quarter Unaudited Financial Results

SHANGHAI,Aug. 20,2021 -- Boqii Holding Limited ("Boqii" or the "Company") (NYSE: BQ),a leading pet-focused platform in China,today announced its unaudited financial results for the first quarter of fiscal year 2022 (the quarter ended June 30,2021).

Fiscal Q1 2022 Operational and Financial Highlights

Total revenues were RMB321.8 million (US$49.8 million),an increase of 35.0% from RMB238.4 million in the same quarter of fiscal year 2021.

Net loss was RMB37.4 million (US$5.8 million),compared to net loss of RMB42.3 million in the same quarter of fiscal year 2021.

Adjusted net loss was RMB31.5 million (US$4.9 million),compared to adjusted net loss of RMB44.4 million in the same quarter of fiscal year 2021.

EBITDA[1] was a loss of RMB35.6 million (US$5.5 million),compared to a loss of RMB35.4 million in the same quarter of fiscal year 2021.

Total GMV[2]was RMB792.1 million (US$122.7 million),an increase of 42.9% from RMB554.5 million in the same quarter of fiscal year 2021.

Active buyers were 1.6 million,an increase of 27.9% from 1.3 million in the same quarter of fiscal year 2021.

[1] EBITDA refers to net loss excluding income tax expenses,interest expense,interest income,depreciation and amortization expenses,but including all the professional expenses in relation to initial public offering in the fiscal year of 2021. EBITDA is a Non-GAAP financial measurement. Please refer to "Non-GAAP financial measurement".

[2] GMV refers to gross merchandise volume,which is the total value of confirmed orders placed with us and sold through distribution model or drop shipping model where we act as a principal in the transaction regardless of whether the products are delivered or returned,calculated based on the listed prices of the ordered products without taking into consideration any discounts. The total GMV amount (i) includes GMV of products sold by Xingmu,(ii) excludes products sold through consignment model and (iii) excludes the value of services offered by us. GMV is subject to future adjustments (such as refunds) and represents only one measure of the Company's performance and should not be relied on as an indicator of our financial results,which depend on a variety of factors.

CEO & CFO Quote

Mr. Hao Liang,Boqii's Founder,Chairman and Chief Executive Officer commented,"We delivered another strong quarter of solid financial and operational results. Our relentless focus to expand and optimize our portfolio offerings powered solid topline growth and user engagement. GMV continued to see strong growth,with 42.9% year over year increase to RMB792.1 million. Total active buyers increased by 27.9% to 1.6 million,with 11.7% year-over-year growth in average spending per user. We are excited to see this continuous momentum of user development and remain committed to bringing in more buyers and retaining existing ones while growing their average spending over time."

Ms. Yingzhi (Lisa) Tang,Boqii's Co-Founder,Co-CEO and CFO commented: "Our strong user growth continued to fuel topline expansion. In this quarter,total revenues grew 35.0% year over year to RMB321.8 million,with an exceptional revenue growth of nearly 20 times year over year from online marketing and information servicesand other revenue. Meanwhile,in addition to our topline growth,this quarter,our adjusted net loss narrowed down to RMB31.5 million,compared to adjusted net loss of RMB44.4 million in the same period last year,showing improving operational efficiency. Looking ahead,we are committed to execute on our growth strategies with a focus on quality and improved monetization capability,which we believe will bring long-term value to both our users and shareholders."

Fiscal Q1 2022 Financial Results

Total revenueswere RMB321.8 million (US$49.8 million),representing an increase of 35.0% from RMB238.4million in the same quarter of fiscal year 2021. The increase was primarily due to the continued organic growth of our business.

Revenues

(in million)

Three Months Ended June 30

%

2021

2020

change

RMB

RMB

YoY

Product sales

311.5

237.9

30.9

• Boqii Mall

108.3

89.8

20.5

• Third party e-commerce platforms

203.2

148.1

37.2

Online marketing and information services and other revenue

10.3

0.5

1,944.2

Total

321.8

238.4

35.0

Gross profit was RMB56.4 million (US$8.7 million),an increase of 30.3% from RMB43.3 million in the same quarter of fiscal year 2021.

Gross marginwas 17.5%,compared with 18.1% in the same quarter of fiscal year 2021. The decrease was mainly due to the increased e-commerce promotions during the 618 Shopping Festival resulting in lower price points.

Operating expenses were RMB97.9 million,an increase of 14.6% from RMB85.4 million in the same quarter of fiscal year 2021. Operating expenses as a percentage of total revenues was 30.4%,down from 35.8% in the same quarter of fiscal year 2021.

Fulfillment Expenses were RMB32.9 million,a decrease of 2.2% from RMB33.6 million in the same quarter of fiscal year 2021. Fulfillment expenses as a percentage of total revenues were 10.2%,down from 14.1% in the same quarter of fiscal year 2021. The decrease was mainly due to: (i) the improved utilization of warehouses by adjusting inventory mix; (ii) more cost-efficient China warehouse relocations; and (iii) lower delivery service prices through renegotiation with third-party delivery service providers.

Sales and marketing expenses were RMB45.5 million,an increase of 30.2% from RMB34.9 million in the same quarter of fiscal year 2021. The increase was primarily due to: (i) the increased personnel expense of RMB3.2 million and increased advertising fee of RMB4.1 million which was in line with our revenue growth,and (ii) the increased share-based compensation expense of RMB1.3 million. Sales and marketing expenses as a percentage of total revenue were 14.1%,down from 14.7% in the same quarter of fiscal year 2021.

General and administrative expenses were RMB19.6 million,an increase of 16.0% from RMB16.9 million in the same quarter of fiscal year 2021. The increase was primarily due to the increased share-based compensation expense of RMB4.7 million,partially offset by the reduced professional expense of RMB2.2 million with the Company's initial public offering in the same quarter of fiscal year 2021. General and administrative expenses as a percentage of total revenue were 6.1%,down from 7.1% in the same quarter of fiscal year 2021.

Operating loss was RMB41.5 million (US$6.4 million),compared to RMB42.1 million in the same quarter of fiscal year 2021.

EBITDA was a loss of RMB35.6 million (US$5.5 million),compared to a loss of RMB35.4 million in the same quarter of fiscal year 2021.

Net loss was RMB37.4 million (US$5.8 million),compared to net loss of RMB42.3 million in the same quarter of fiscal year 2021.

Adjustednet loss was RMB31.5million (US$4.9 million),compared to adjusted net loss of RMB44.4 million in the same quarter of fiscal year 2021.

Diluted net loss per sharewas RMB0.52 (US$0.08),compared to diluted net loss per share of RMB4.06 in the same quarter of fiscal year 2021.

Total cash and cash equivalents and short-term investmentswere RMB415.7 million (US$64.4 million),compared to RMB460.8 million as of March 31,2021.

Conference Call

Boqii's management will hold a conference call to discuss the financial results at 8:00 AM on Friday,August 20,2021,U.S. Eastern Time (8:00 PM on Friday,Beijing/Hong Kong Time).

To join the conference,please dial in 15 minutes before the conference is scheduled to begin using below numbers.

Phone Number

International

1-412-317-6061

United States

1-888-317-6003

Hong Kong

852 800 963-976

Mainland China

86 4001-206115

Passcode

7711990

A replay of the conference call may be accessed by phone at the following numbers until August 27,2021.

Phone Number

International

1-412-317-0088

United States

1-877-344-7529

Replay Access Code

10159611

A live and archived webcast of the conference call will be available on the Company's investor relations website at http://ir.boqii.com/.

About Boqii Holding Limited

Boqii Holding Limited (NYSE: BQ) is a leading pet-focused platform in China. We are the leading online destination for pet products and supplies in China with our broad selection of high-quality products including global leading brands,local emerging brands,and our own private label,Yoken and Mocare,offered at competitive prices. Our online sales platforms,including Boqii Mall and our flagship stores on third-party e-commerce platforms,provide customers with convenient access to a wide selection of high-quality pet products and an engaging and personalized shopping experience. Our Boqii Community provides an informative and interactive content platform for users to share their knowledge and love for pets.

Safe Harbor Statement

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. Statements that are not historical facts,including statements about the Company's beliefs and expectations,are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties,and a number of factors could cause actual results to differ materially from those contained in any forward-looking statement. In some cases,forward-looking statements can be identified by words or phrases such as "may," "will," "expect," "anticipate," "target," "aim," "estimate," "intend," "plan," "believe," "potential," "continue," "is/are likely to" or other similar expressions. The Company may also make written or oral forward-looking statements in its reports filed with,or furnished to,the U.S. Securities and Exchange Commission,in its annual reports to shareholders,in press releases and other written materials and in oral statements made by its officers,directors or employees to third parties. Statements that are not historical facts,are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. Further information regarding such risks,uncertainties or factors is included in the Company's filings with the SEC. All information provided in this press release is as of the date of this press release,and the Company does not undertake any duty to update such information,except as required under applicable law.

Non-GAAPFinancial Measures

The Company uses non-GAAP financial measures,namely adjusted net loss,adjusted net loss margin,EBITDA and EBITDA margin,in evaluating its operating results and for financial and operational decision-making purposes. The Company defines (i) adjusted net loss as net loss excluding fair value change of derivative liabilities and share-based compensation expenses,(ii) adjusted net loss margin as adjusted net loss as a percentage of total revenues,(iii) EBITDA as net loss excluding income tax expenses,(iv) EBITDA margin as EBITDA as a percentage of total revenues. The Company believes adjusted net loss,EBITDA and EBITDA margin enhance investors' overall understanding of its financial performance and allow for greater visibility with respect to key metrics used by its management in its financial and operational decision-making.

These non-GAAP financial measures are not defined under U.S. GAAP and are not presented in accordance with U.S. GAAP. As these non-GAAP financial measures have limitations as analytical tools and may not be calculated in the same manner by all companies,they may not be comparable to other similarly titled measures used by other companies. The Company compensates for these limitations by reconciling the non-GAAP financial measures to the nearest U.S. GAAP performance measures,which should be considered when evaluating the Company's performance. For reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures,please see the section of the accompanying tables titled,"Reconciliation of GAAP and Non-GAAP Results." The Company encourages investors and others to review its financial information in its entirety and not rely on any single financial measure.

Exchange Rate

This press release contains translations of certain RMB amounts into U.S. dollars ("USD") at specified rates solely for the convenience of the reader. Unless otherwise stated,all translations from RMB to USD were made at the rate of RMB6.4566 to US$1.00,the noon buying rate in effect on June 30,2021 in the H.10 statistical release of the Federal Reserve Board. The Company makes no representation that the RMB or USD amounts referred to could be converted into USD or RMB,as the case may be,at any particular rate or at all.

For investor and media inquiries,please contact:

In China:Boqii Holding Limited

Investor Relations

Tel: +86-21-6882-6051

Email:ir@boqii.comThe Blueshirt Group

Ms. Susie Wang

Email: susie@blueshirtgroup.comIn the United States:The Blueshirt Group

Ms. Julia Qian

Email: julia@blueshirtgroup.comBOQII HOLDING LIMITEDUNAUDITED INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS(All amounts in thousands,except for share and per share data,unless otherwise noted)

As of

As of

As of

March 31,

June 30,

2021

2021

2021

RMB

RMB

US$ASSETS

Current assets:

Cash and cash equivalents292,237

287,060

44,460Short-term investments168,546

128,678

19,930Accounts receivable,net45,732

74,277

11,504Inventories,net91,551

105,809

16,388Prepayments and other current assets85,261

74,613

11,556Amounts due from related parties11,465

34,294

5,311Total current assets694,792

704,731

109,149Non-current assets:

Property and equipment,net8,386

8,338

1,291Intangible assets29,537

28,540

4,420Operating lease right-of-use assets29,234

32,805

5,081Long-term investments74,330

79,232

12,271Goodwill40,184

40,684

6,301Other non-current asset4,111

4,024

624Total non-current assets185,782

193,623

29,988Total assets880,574

898,354

139,137LIABILITIES,MEZZANINE EQUITY AND SHAREHOLDERS' DEFICIT

Current liabilities

Short-term borrowings85,566

103,332

16,004Accounts payable71,848

114,384

17,716Salary and welfare payable6,309

4,860

753Accrued liabilities and other current liabilities30,055

30,096

4,661Amounts due to related parties,current910

10,178

1,577Contract liabilities3,866

3,474

538Operating lease liabilities,current8,063

9,639

1,493Derivative liabilities9,996

10,125

1,568Total current liabilities216,613

286,088

44,310Non-current liabilities

Deferred tax liabilities8,958

8,711

1,349Operating lease liabilities,non-current19,997

21,891

3,390Long-term borrowings68,075

49,674

7,693Other debts,non-current433,292

365,256

56,571Total non-current liabilities530,322

445,532

69,003Total liabilities746,935

731,620

113,313

Mezzanine equity

Redeemable non-controlling interests5,946

6,086

943Total mezzanine equity5,086

943Stockholders' equity:

Class A ordinary shares (US$0.001 par value; 129,500,000 shares authorized,

54,505,108 and 54,556,503 shares issued and outstanding as of March 31

and June 30,respectively)364

365

56Class B ordinary shares (US$0.001 par value; 15,000,

13,037,729 shares issued and outstanding as of March 31 and June 30,

2021,respectively)82

82

13Additional paid-in capital3,272,612

3,279,409

507,916Statutory reserves3,047

3,117

483Accumulated other comprehensive loss(20,172)

(28,884)

(4,474)Accumulated deficit(2,759,882)

(2,794,987)

(432,888)Receivable for issuance of ordinary shares(413,377)

(343,068)

(53,135)Total Boqii Holding Limited shareholders' equity82,674

116,034

17,971Non-controlling interests45,019

44,614

6,910Total shareholders' equity127,693

160,648

24,881Total liabilities,mezzanine equity and shareholders' equity880,137

Notes for all the condensed consolidated financial schedules presented:Note 1: The conversion of Renminbi (RMB) into U.S. dollars (USD) is based on the certified exchange rate of USD1.00=RMB6.4566

on June 30,2021 published by the Federal Reserve Board.BOQII HOLDING LIMITEDUNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS(All amounts in thousands,unless otherwise noted)

Three Months Ended June 30,

2020

2021

2021

RMB

RMB

US$

Net revenues:

Product sales237,932

311,493

48,244Online marketing and information services and other revenue506

10,353

1,604Total revenues238,438

321,846

49,848Total cost of revenue(195,168)

(265,465)

(41,115)Gross profit43,270

56,381

8,733Operating expenses:

Fulfillment expenses(33,632)

(32,887)

(5,094)Sales and marketing expenses(34,944)

(45,485)

(7,045)General and administrative expenses(16,868)

(19,571)

(3,031)Other income,net47

12

2Loss from operations(42,127)

(41,550)

(6,435)Interest income1,716

5,187

803Interest expense(7,143)

(6,062)

(939)Other gain,net2,897

3,128

484Fair value change of derivative liabilities2,106

162

25Loss before income tax expenses(42,551)

(39,135)

(6,062)Income taxes expenses309

1,009

156Share of results of equity investees(57)

766

119Net loss(42,299)

(37,360)

(5,787)Less: Net income/(loss) attributable to the non-controlling

interest shareholders279

(2,467)

(382)Net loss attributable to Boqii Holding Limited(42,578)

(34,893)

(5,405)Less: Accretion on convertible redeemable preferred shares to

redemption value(35,137)

-

-Less: Accretion on redeemable non-controlling interests to

redemption value-

(140)

(22)Less: Deemed dividend to preferred shareholders(12,547)

-

-Net lossattributable to Boqii Holding Limited's ordinary

shareholders(90,262)

(35,033)

(5,427)Net loss(42,787)Other comprehensive loss:

Foreign currency translation adjustment,net of nil tax(801)

(8,712)

(1,349)Unrealized securities holding gains1,195

-

-Total comprehensive loss(41,905)

(46,072)

(7,136)Less: Total comprehensive income/(loss) attributable to non-

controlling interests shareholders279

(2,467)

(382)Total comprehensive loss attributable to Boqii Holding

Limited(42,184)

(43,605)

(6,754)Net loss per share attributable to Boqii Holding Limited's

ordinary shareholders

— basic(4.06)

(0.52)

(0.08)— diluted(4.06)

(0.52)

(0.08)Weighted average number of ordinary shares

— basic22,238,454

67,640,952

67,952— diluted22,952

Notes for all the condensed consolidated financial schedules presented:Note 1: The conversion of Renminbi (RMB) into U.S. dollars (USD) is based on the certified exchange rate of

USD1.00=RMB6.4566 on June 30,2021 published by the Federal Reserve Board.Boqii Holding LimitedReconciliation of GAAP and Non-GAAP Results(In thousands)

Three Months Ended June 30,

2020

2021

RMB

RMB

Net loss(42,360)Fair value change of derivative liabilities(2,106)

(162)Share-based compensation-

5,986Adjusted Net Loss (44,405)

(31,536)Adjusted Net Loss Margin(18.6%)

(9.8%)

Three Months Ended June 30,360)Income tax expenses(309)

(1,009)Interest expenses7,143

6,062Interest income(1,716)

(5,187)Depreciation and amortization1,750

1,928EBITDA (35,431)

(35,566)EBITDA Margin(14.9%)

(11.1%)

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