Dingdong maintains profitability with commodity and supply chain strengths
Dingdong, a Chinese online grocery platform, released its Q4 2023 financial report and the annual financial report for 2023 on February 29th, maintaining stable growth and achieving continuous profitability for the fifth consecutive quarter under the Non-GAAP standard. The company also reported its first annual profit under the Non-GAAP standard.
In terms of full-year performance, Dingdong realized GMV of CNY 21.97 billion in 2023, although the scale declined sequentially, but if exclude the partial impact of the epidemic in 2022 and the adjustment of the operating region in 2023, the performance of the core operating data is far beyond expectations.
According to the results meeting held by Dingdong, compared with 2021, the company's overall customer unit price increased by 23% to CNY 72.1; the GMV scale of the East China market has also achieved a compound annual growth of 10%. In addition, both GMV and order volume in the Jiangsu and Zhejiang regions have achieved positive year-on-year growth of more than 8%, even when compared to 2022, when the base is higher.
Specifically, total revenue was CNY 4.9935 billion, compared to CNY 6.2006 billion in the same period in 2022. Net loss was CNY 4.4 million, while net profit in the same period in 2022 was CNY 49.9 million. If not in accordance with the US Generally Accepted Accounting Principles (GAAP), net profit was CNY 16.3 million, compared to CNY 115.8 million in the same period in 2022.
In terms of operational performance, the Gross Merchandise Volume (GMV) during the reporting period was CNY 5.53 billion, with a net profit margin of 0.3% under the Non-GAAP standard. Dingdong achieved a user penetration rate of 73.6% for its own-brand products. The GMV penetration rates for pre-packaged meals, pork, and soy products, three categories with significant market prospects, all exceeded 50% for the entire year.
From a cash flow perspective, Dingdong achieved a net operating cash inflow of CNY 120 million in that quarter. As of the end of the fourth quarter, the balance of cash and cash equivalents, short-term restricted funds, and short-term investments was CNY 5.31 billion.
During the Chinese New Year period, Dingdong delivered impressive performance. Against the backdrop of an increase in consumer mobility during this year's Spring Festival, the company's same-store sales volume increased by 6% during the period from New Year's Eve to the Lantern Festival, with a 9% increase in the Eastern China region. On the Lantern Festival day, February 24th, the company achieved a single-day sales breakthrough of CNY 100 million, reaching the highest level since the pandemic.
The company's solid performance can be attributed to its "efficiency-first, while considering scale" strategy and the "product strength" strategy implemented since 2021. Dingdong has developed a representative portfolio of own-brand and platform popular products, gaining high user stickiness. The supply chain capabilities accumulated during the product development process will further enhance the platform's product performance and user experience.
In the future, Dingdong will leverage its accumulated supply chain advantages, maintain its focus on the "food" theme, continuously expand beyond the dining table into other scenarios and external channels, break category boundaries, seek incremental opportunities, and further increase the quantity and quality of self-developed products.
During the performance meeting, Dingdong executives stated that the company will continue to enhance market penetration through refined operations and site optimization based on its existing coverage area. They aim to provide consumers with more reliable service capabilities, stable quality assurance, and competitive pricing.