Leju Reports Fourth Quarter and Full Year 2018 Results

BEIJING,March 18,2019 -- Leju Holdings Limited ("Leju" or the "Company") (NYSE: LEJU),a leading online-to-offline ("O2O") real estate services provider in China,today announced its unaudited financial results for the fiscal quarter and full year ended December 31,2018.

Fourth Quarter 2018 Financial Highlights

Total revenues increased by 17% year-on-year to $124.2 million.

- Revenues from e-commerce services increased by 16% year-on-year to $82.4 million.

- Revenues from online advertising services increased by 25% year-on-year to $40.9 million.

Loss from operations was $0.8 million,a decrease of 97% from $25.4 million for the same quarter of 2017.

Non-GAAP[1] income from operations was $3.3 million,compared to non-GAAP loss from operations of $21.7 million for the same quarter of 2017.

Net income attributable to Leju Holdings Limited shareholders was $1.4 million,or $0.01 per diluted American depositary share ("ADS"),compared to net loss attributable to Leju Holdings Limited shareholders of $22.3 million,or $0.16 loss per diluted ADS,for the same quarter of 2017.

Non-GAAP net income attributable to Leju Holdings Limited shareholders was $4.7 million,or $0.03 per diluted ADS,compared to non-GAAP net loss attributable to Leju Holdings Limited shareholders of $19.2 million,or $0.14 loss per diluted ADS,for the same quarter of 2017.

Full Year 2018 Financial Highlights

Total revenues increased by 27% year-on-year to $462.0 million.

- Revenues from e-commerce services increased by 36% year-on-year to $320.3 million.

- Revenues from online advertising services increased by 22% year-on-year to $138.4 million.

Loss from operations was $11.0 million,a decrease of 94% from $183.9 million for 2017.

Non-GAAP income from operations was $6.1 million,compared to non-GAAP loss from operations of $125.9 million for 2017.

Net loss attributable to Leju Holdings Limited shareholders was $13.5 million,or $0.10 loss per diluted ADS,a decrease of 92% from $160.9 million,or $1.19 loss per diluted ADS for 2017.

Non-GAAP net income attributable to Leju Holdings Limited shareholders was $0.4 million,or $0.00 per diluted ADS,compared to non-GAAP net loss attributable to Leju Holdings of $105.0 million,or $0.77 loss per diluted ADS for 2017.

[1] Leju uses in this press release the following non-GAAP financial measures: (1) income (loss) from operations,(2) net income (loss),(3) net income (loss) attributable to Leju shareholders,(4) net income (loss) attributable to Leju shareholders per basic ADS,and (5) net income (loss) attributable to Leju shareholders per diluted ADS,each of which excludes share-based compensation expense,amortization of intangible assets resulting from business acquisitions,goodwill impairment,and income tax impact on the share-based compensation expense,amortization of intangible assets resulting from business combinations,and goodwill impairment. See "About Non-GAAP Financial Measures" and "Unaudited Reconciliation of GAAP and Non-GAAP Results" below for more information about the non-GAAP financial measures included in this press release.

"Leju returned to profitability(Non-GAAP) during 2018 as a result of our ongoing innovation and organizational optimization,despite the lack of significant improvement in the overall market environment," said Mr. Geoffrey He,Leju's Chief Executive Officer. "We successfully implemented our 'New Media,New Ecosystem,and New E-commerce' business strategy formulated at the beginning of 2018. Leju Finance enhanced its media influence through improved content productivity and leveraged its revamped operating model across our new media platform,which integrates content and distributes edited news across multiple channels. We delivered healthy growth in our online advertising segment,which relies on our Cloud-Eye big data capability,Admall open system and mini-app open platform. In addition,our e-commerce services saw a substantial recovery and further increased market share as a result of product innovation and business expansion in lower tier cities,coupled with our top-down strategy,which enables us to grow our project pipeline by entering into framework contracts with property developers."

"Since the end of 2018,we have seen increasing demand for marketing services from developers as a result of changes in real estate market conditions," continued Mr. He. "Looking to the year ahead,we will aim to capture opportunities to further solidify our leading market position in media,advertising and e-commerce services. In addition,we have completed our corporate restructuring,which has helped to improve operational efficiency and lay a solid foundation for our future growth."

Fourth Quarter 2018 Results

Total revenues were $124.2 million,an increase of 17% from $106.4 million for the same quarter of 2017,mainly due to an increase in revenues from e-commerce services and online advertising services.

Revenues from e-commerce services were $82.4 million,an increase of 16% from $71.2 million for the same quarter of 2017,primarily due to an increase in the average price per discount coupon redeemed,partially offset by a decrease in the number of discount coupons redeemed.

Revenues from online advertising services were $40.9 million,an increase of 25% from $32.7 million for the same quarter of 2017,primarily due to an increase in property developers' demand for online advertising.

Revenues from listing services were $1.0 million,a decrease of 61% from $2.4 million for the same quarter of 2017,primarily due to a decrease in secondary real estate brokers' demand.

Cost of revenues was $18.9 million,a decrease of 4% from $19.6 million for the same quarter of 2017,primarily due to decreased staff cost as a result of headcount change,partially offset by increased cost of advertising resources purchased from media platforms.

Selling,general and administrative expenses were $106.1 million,a decrease of 5% from $112.3 million for the same quarter of 2017,and decreased office and other operating expenses,partially offset by increased marketing expenses related to the Company's e-commerce business.

Loss from operations was $0.8 million,compared to $25.4 million for the same quarter of 2017. Non-GAAP income from operations was $3.3 million,compared to non-GAAP loss from operations of $21.7 million for the same quarter of 2017.

Other income,net was $2.1 million,compared to $1.1 million for the same quarter of 2017,primarily due to $1.9 million foreign exchange gain recognized for the fourth quarter of 2018.

Net income was $2.1 million,compared to net loss of $22.5 million for the same quarter of 2017. Non-GAAP net income was $5.4 million,compared to non-GAAP net loss of $19.4 million for the same quarter of 2017.

Net income attributable to Leju Holdings Limited shareholders was $1.4 million,or $0.01 per diluted ADS,for the same quarter of 2017. Non-GAAP net income attributable to Leju Holdings Limited shareholders was $4.7 million,for the same quarter of 2017.

Full Year 2018 Results

Total revenues were $462.0 million,an increase of 27% from $362.5 million for 2017,mainly due to an increase in revenues from e-commerce services and online advertising services.

Revenues from e-commerce services were $320.3 million,an increase of 36% from $234.8 million for 2017,partially offset by a decrease in the number of discount coupons redeemed.

Revenues from online advertising services were $138.4 million,an increase of 22% from $113.2 million for 2017,primarily due to an increase in property developers' demand for online advertising.

Revenues from listing services were $3.4 million,a decrease of 77% from $14.5 million for 2017,primarily due to a decrease in demand from secondary real estate brokers.

Cost of revenues was $72.9 million,a decrease of 2% from $74.1 million for 2017,primarily due to decreased staff costs as a result of headcount changes and decreased amortization expenses of intangible assets,general and administrative expenses were $402.3 million,a decrease of 7% from $434.3 million for 2017,primarily due to decreased staff costs as a result of headcount change,and partially offset by increased marketing expenses related to the Company's e-commerce business.

Loss from operations was $11.0 million,compared to $183.9 million for 2017. Non-GAAP income from operations was $6.1 million,compared to non-GAAP loss from operations of $125.9 million for 2017.

Other loss,net was $4.2 million,compared to other income of $0.5 million for 2017,primarily due to $3.8 million foreign exchange loss recognized for 2018.

Net loss was $12.9 million,compared to $162.0 million for 2017. Non-GAAP net income was $1.0 million,compared to non-GAAP net loss of $106.1 million for 2017.

Net loss attributable to Leju Holdings Limited shareholders was $13.5 million,compared to $160.9 million,or $1.19 loss per diluted ADS for 2017. Non-GAAP net income attributable to Leju Holdings Limited shareholders was $0.4 million,or $0.77 loss per diluted ADS for 2017.

Cash Flow

As of December 31,2018,the Company's cash and cash equivalents balance was $147.3 million.

Fourth quarter 2018 net cash used in operating activities was $20.4 million,primarily comprised of an increase in accounts receivable and contract assets of $13.2 million,an increase in customer deposit of $4.4 million,a decrease in accounts payable of $3.8 million and a decreased in other payables of $3.7 million,partially offset by non-GAAP net income of $5.4 million.

Business Outlook

The Company estimates that its total revenues for the first quarter of 2019 will be approximately $90 million to $94 million,which would represent an increase of approximately 10% to 15% from $81.5 million in the same quarter in 2018. This forecast reflects the Company's current and preliminary view,which is subject to change.

Conference Call Information

Leju's management will host an earnings conference call on March 18,2019 at 7 a.m. U.S. Eastern Time (7 p.m. Beijing/Hong Kong time).

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

U.S./International:

+1-845-675-0437

Hong Kong:

+852-3018-6771

Mainland China:

400-620-8038

Please dial in 10 minutes before the call is scheduled to begin and provide the passcode to join the call. The passcode is "Leju earnings call".

A replay of the conference call may be accessed by phone at the following number until March 26,2019:

U.S./International:

+1-855-452-5696

Hong Kong:

800-963-117

Mainland China:

400-632-2162

Passcode:

9445779

Additionally,a live and archived webcast will be available at http://ir.leju.com.

About Leju

Leju Holdings Limited ("Leju") (NYSE: LEJU) is a leading online-to-offline,or O2O,real estate services provider in China,offering real estate e-commerce,online advertising and online listing services. Leju's integrated online platform comprises various mobile applications along with local websites covering more than 370 cities,enhanced by complementary offline services to facilitate residential property transactions. In addition to the Company's own websites,Leju operates the real estate and home furnishing websites of SINA Corporation,and maintains a strategic partnership with Tencent Holdings Limited. For more information about Leju,please visit http://ir.leju.com.

Safe Harbor: Forward-Looking Statements

This announcement contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934,as amended,and as defined in 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," "target," "going forward," "outlook" and similar statements. Leju may also make written or oral forward-looking statements in its reports filed or furnished with the U.S. Securities and Exchange Commission,in its annual report 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,including statements about Leju's beliefs and expectations,are forward-looking statements that involve inherent risks and uncertainties. A number of important factors could cause actual results to differ materially from those contained,either expressly or impliedly,in any of the forward-looking statements. Such factors include,but are not limited to,fluctuations inChina'sreal estate market; the highly regulated nature of,and government measures affecting,the real estate and internet industries inChina; Leju's ability to compete successfully against current and future competitors; its ability to continue to develop and expand its content,service offerings and features,and to develop or incorporate the technologies that support them; its limited operating history and lack of experience as a stand-alone public company,given its carve-out from E-House and prior reliance on E-House for various corporate services; its reliance on SINA and others with which it has developed,or may develop in the future,strategic partnerships; substantial revenue contribution from a limited number of real estate markets; complexities resulting from its ongoing relationships with E-House,due to E-House's status as a principal shareholder of Leju; and relevant government policies and regulations relating to the corporate structure,business and industry of Leju. Further information regarding these and other risks,uncertainties or factors is included in the Company's filings with the U.S. Securities and Exchange Commission. All information provided in this press release is current as of the date of the press release,and the Company does not undertake any obligation to update any forward-looking statement as a result of new information,future events or otherwise,except as required under applicable law.

About Non-GAAP Financial Measures

To supplement Leju's consolidated financial results presented in accordance with United States Generally Accepted Accounting Principles ("GAAP"),Leju uses in this press release the following non-GAAP financial measures: (1) income (loss) from operations,and goodwill impairment. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. For more information on these non-GAAP financial measures,please see the table captioned "Unaudited Reconciliation of GAAP and Non-GAAP Results" set forth at the end of this press release.

Leju believes that these non-GAAP financial measures provide meaningful supplemental information to investors regarding its operating performance by excluding share-based compensation expense,and goodwill impairment,which may not be indicative of Leju's operating performance. These non-GAAP financial measures also facilitate management's internal comparisons to Leju's historical performance and assist its financial and operational decision making. A limitation of using these non-GAAP financial measures is that share-based compensation expense,and goodwill impairment may continue to exist in Leju's business for the foreseeable future. Management compensates for these limitations by providing specific information regarding the GAAP amounts excluded from each non-GAAP measure. The accompanying tables provide more details on the reconciliation between non-GAAP financial measures and their most comparable GAAP financial measures.

For investor and media inquiries please contact:

Ms. Christina Wu

Leju Holdings Limited

Phone: +86 (10) 5895-1062

E-mail: ir@leju.com

Philip Lisio

Foote Group

Phone: +86 135-0116-6560

E-mail: phil@thefootegroup.com

LEJU HOLDINGS LIMITED

UNAUDITED CONSOLIDATED BALANCE SHEETS

(In thousands of U.S. dollars)

December 31,

December 31,

2017

2018

ASSETS

Current assets

Cash and cash equivalents

150,968

147,263

Restricted cash

337

-

Accounts receivable,net

79,196

102,697

Contract assets

1,410

2,137

Marketable securities

3,077

2,467

Prepaid expenses and other current assets

9,945

8,621

Customer deposits

35,823

10,672

Amounts due from related parties

4,077

6,695

Total current assets

284,833

280,552

Property and equipment,net

14,240

14,058

Intangible assets,net

70,631

57,401

Investment in affiliates

146

63

Deferred tax assets

67,084

62,356

Other non-current assets

2,010

2,297

Total assets

438,944

416,727

LIABILITIES AND EQUITY

Current liabilities

Accounts payable

2,950

803

Accrued payroll and welfare expenses

37,082

30,628

Income tax payable

63,380

58,030

Other tax payable

11,654

12,675

Amounts due to related parties

3,093

3,477

Advance from customers and deferred revenue

10,565

26,873

Accrued marketing and advertising expenses

18,852

14,896

Other current liabilities

16,315

12,999

Total current liabilities

163,891

160,381

Deferred tax liabilities

18,016

14,780

Total liabilities

181,907

175,161

Shareholders' Equity

Ordinary shares ($0.001 par value): 1,000,000 shares

authorized,135,763,962 and 135,962 shares issued and

outstanding,as of December 31,2017 and 2018,

respectively

136

136

Additional paid-in capital

788,589

792,626

Accumulated deficit

(515,344)

(528,825)

Accumulated other comprehensive loss

(13,078)

(19,848)

Total Leju Holdings Limited shareholders' equity

260,303

244,089

Non-controlling interests

(3,266)

(2,523)

Total equity

257,037

241,566

TOTAL LIABILITIES AND EQUITY

438,727

LEJU HOLDINGS LIMITED

UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands of U.S. dollars,except share data and per share data)

Three months ended

Year ended

December 31,

2017

2018

2017

2018

Revenues

E-commerce

71,217

82,377

234,836

320,271

Online advertising services

32,719

40,913

113,235

138,372

Listing services

2,432

954

14,461

3,388

Total revenues

106,368

124,244

362,532

462,031

Cost of revenues

(19,617)

(18,895)

(74,054)

(72,910)

Selling,general and administrative expenses

(112,293)

(106,136)

(434,276)

(402,258)

Goodwill impairment charge

-

-

(41,223)

-

Other operating income

171

5

3,072

2,163

Loss from operations

(25,371)

(782)

(183,949)

(10,974)

Interest income

326

241

1,314

1,086

Other income (loss),net

1,103

2,050

480

(4,219)

Income (loss) before taxes and loss from

equity in affiliates

(23,942)

1,509

(182,155)

(14,107)

Income tax benefits

1,510

602

20,328

1,334

Income (loss) before loss from equity in

affiliates

(22,432)

2,111

(161,827)

(12,773)

Loss from equity in affiliates

(28)

(9)

(216)

(79)

Net income (loss)

(22,460)

2,102

(162,043)

(12,852)

Less: net income (loss) attributable to non-

controlling interests

(158)

681

(1,142)

629

Income (loss) attributable to Leju Holdings

Limited shareholders

(22,302)

1,421

(160,901)

(13,481)

Earnings (loss) per ADS:

Basic/ Diluted

(0.16)

0.01

(1.19)

(0.10)

Shares used in computation of earnings (loss) per

ADS:

Basic/ Diluted

135,962

135,708,350

135,962

Note 1

The conversion of functional currency Renminbi ("RMB") amounts into reporting

currency USD amounts is based on the rate of USD1 = RMB6.8632 on December 31,

2018 and USD1 = RMB6.6126 for the year ended December 31,2018

LEJU HOLDINGS LIMITED

UNAUDITED CONSOLIDATED STATEMENT OF COMPREHENSIVE LOSS

(In thousands of U.S. dollars)

Three months ended

Year ended

December 31,

2017

2018

2017

2018

Net income (loss)

(22,852)

Other comprehensive income (loss),net of tax of nil

Foreign currency translation adjustment

3,516

(2,662)

9,137

(6,678)

Comprehensive loss

(18,944)

(560)

(152,906)

(19,530)

Less: Comprehensive income (loss) attributable to

non-controlling interest

(187)

650

(1,249)

721

Comprehensive loss attributable to Leju

Holdings Limited shareholders

(18,757)

(1,210)

(151,657)

(20,251)

LEJU HOLDINGS LIMITED

Unaudited Reconciliation of GAAP and Non-GAAP Results

(In thousands of U.S. dollars,except share data and per ADS data)

Three months ended

Year ended

December 31,

2017

2018

2017

2018

GAAP loss from operations

(25,974)

Share-based compensation expense

151

925

3,525

4,058

Amortization of intangible assets resulting from business

acquisitions

3,485

3,205

13,333

13,064

Goodwill impairment

-

-

41,223

-

Non-GAAP income (loss) from operations

(21,735)

3,348

(125,868)

6,148

GAAP net income (loss)

(22,852)

Share-based compensation expense

151

925

3,058

Amortization of intangible assets resulting from

business acquisitions

3,223

-

Income tax benefit:

Current

-

-

-

-

Deferred[2]

(574)

(801)

(2,144)

(3,266)

Non-GAAP net income (loss)

(19,398)

5,431

(106,106)

1,004

Net income (loss) attributable to Leju Holdings Limited

shareholder

(22,481)

Share-based compensation expense

(net of non-controlling interests)

142

925

3,491

4,038

Amortization of intangible assets resulting from business

acquisitions (net of non-controlling interests)

3,223

-

Income tax benefit:

Current

-

-

-

-

Deferred

(574)

(801)

(2,266)

Non-GAAP net income (loss) attributable to Leju

Holdings Limited shareholders

(19,249)

4,750

(104,998)

355

GAAP net income (loss) per ADS -- basic/diluted

(0.16)

0.01

(1.19)

(0.10)

Non-GAAP net income(loss) per ADS -- basic/diluted

(0.14)

0.03

(0.77)

0.00

Shares used in calculating basic GAAP/non-GAAP net

income (loss) attributable to shareholders per ADS

135,962

[2] Amount represents the realization of deferred tax liabilities recognized for the temporary difference between the tax

basis of intangible assets recognized from acquisitions and their reported amounts in the financial statements. The

income tax impact on the share-based compensation expense,and goodwill impairment are nil.

LEJU HOLDINGS LIMITED

SELECTED OPERATING DATA

Three months ended

Year ended

December 31,

2017

2018

2017

2018

Operating data for e-commerce services

Number of discount coupons issued to

prospective purchasers (number of

transactions)

47,419

34,562

246,318

144,046

Number of discount coupons redeemed (number

of transactions)

31,046

24,144

113,420

89,638

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