Luckin Coffee's 2021 Revenue Approaches 8 Billion Yuan and Store Count Surpasses Starbucks China

Luckin Coffee reported total net revenue of 7.965 billion yuan for the 2021 fiscal year, a 97.5% increase. Fourth-quarter revenue reached 2.4327 billion yuan, up 80.7%. By year's end, Luckin operated 6,024 stores, surpassing Starbucks' store count in China. Franchise store revenue surged 312.5%, contributing notably to lower-tier markets. Delivery expenses were 233 million yuan for the quarter, and non-GAAP operating loss narrowed to 23.6 million yuan.

With profitability approaching, Luckin completed its provisional liquidation and expects fraud-related costs to drop significantly in the second quarter of 2022. The company's expansion continues, with franchise stores accounting for 60% of new openings. Urban commuters frequently carry Luckin cups, and former milk tea shops now display Luckin signs. The financial fraud scandal has become a historical footnote, and observers watch closely for a potential return to the Nasdaq main board.

Luckin Coffee's total net revenue for the 2021 fiscal year reached 7.965 billion yuan, a sharp year-on-year increase of 97.5%. Fourth-quarter revenue was 2.4327 billion yuan, up 80.7%. By the end of last year, Luckin had 6,024 stores in total, surpassing Starbucks' store scale in China. Both self-operated stores and franchise stores gained momentum, with annual revenue from franchise stores growing 312.5%, making a notable contribution to lower-tier markets. Delivery expenses were disclosed separately, with quarterly spending of 233 million yuan. Non-GAAP operating loss narrowed to 23.6 million yuan, with profitability just around the corner. After completing the provisional liquidation, Luckin expects costs related to fraudulent transactions in the second quarter of 2022 to drop significantly. The outside world continues to watch closely for its return to the Nasdaq main board.

On the commute, the urban white-collar workers and young men and women almost all have Luckin Coffee in their hands. One cup in the morning to wake up, another in the afternoon for leisure. What was a milk tea shop yesterday has already put up the Luckin sign today. The financial fraud scandal has long since become a turned page in Luckin's history.

Luckin Coffee's unaudited financial report for the fourth quarter and full year of 2021 shows that total net revenue for the 2021 fiscal year reached 7.965 billion yuan, an increase of 97.5% over the previous year; total net revenue for the fourth quarter was 2.4327 billion yuan, a year-on-year increase of 80.7%.

As of the end of last year, Luckin had a total of 6,024 stores, including 4,397 self-operated stores and 1,627 affiliated stores. A net total of 1,221 stores were added for the year, up 25.4% compared with the full year of 2020, and franchise stores accounted for 60% of newly opened stores.

In 2021, revenue from Luckin's self-operated stores was 6.193 billion yuan, up 78.3% year on year; fourth-quarter revenue was 1.837 billion yuan, up 61% year on year. As for franchise stores, revenue in the 2021 fiscal year was 1.306 billion yuan, surging 312.5% year on year.

These non-self-operated franchise stores made outstanding contributions, with many located in third-, fourth-, and fifth-tier cities, providing strong momentum for Luckin's overall revenue growth. A rough estimate puts the average annual revenue of each franchise store at about 800,000 yuan.

In this financial report, Luckin listed fourth-quarter delivery expenses separately, with delivery spending alone reaching 233 million yuan in the quarter, up 83.8% year on year. Luckin explained that the rapid rise in delivery expenses was mainly due to an increase in delivery order volume.

Coffee consumption is spreading with young people from first- and second-tier large cities to third- and fourth-tier county towns, and coffee can even be seen in some small villages and towns. Consumption upgrading and the narrowing of the urban-rural gap are driving explosive growth in coffee consumption in lower-tier markets, attracting more and more young people to return to their hometowns to start businesses. Starbucks' recent series of negative news in China has created more opportunities for Luckin. At present, Luckin's number of stores has surpassed Starbucks' number of stores in China.

The rapid growth of multiple indicators shows that Luckin's profitability has improved substantially, and the day of achieving profitability is close at hand. In the fourth quarter of 2020, the operating loss under Non-GAAP (adjusted net profit) was 369 million yuan; by the same period in 2021, this figure had narrowed to 23.6 million yuan.

In addition, Luckin revealed in its financial report that, with the successful completion of the provisional liquidation in the first quarter of 2022, the company expects losses and expenses related to fraudulent transactions and restructuring to decrease significantly in the second quarter of 2022.

Luckin Coffee has broken away from the control of its former management and is on a growth track, and outsiders had long speculated that it would return to the Nasdaq main board. Although Luckin denied rumors of a return to Nasdaq in late January this year, the public remains full of expectations for Luckin.

Usually, companies entering the Pink Sheets market have no financial disclosure obligations, but Luckin still insists on publishing financial reports on schedule, using transparency to strengthen confidence on all sides. Do you think Luckin's return to Nasdaq is still far away?

Image source: Internet

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The above content is compiled by CoffeeHunters, a coffee news website.