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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF
THE SECURITIES EXCHANGE ACT OF 1934
For the month of December 2022
Commission file number: 001-39278
Kingsoft Cloud Holdings Limited
(Exact Name of Registrant as Specified in Its Charter)
Building E, Xiaomi Science and Technology Park, No. 33 Xierqi Middle Road,
Haidian District
Beijing, 100085, the People’s Republic of China
(Address of Principal Executive Offices)
Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.
Form 20-F ☒Form 40-F ☐
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ☐
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ☐
This Report on Form 6-K shall be deemed to be incorporated by reference into the registration statement on Form F-3 (File No. 333- 260181) filed by Kingsoft Cloud Holdings Limited with the Securities and Exchange Commission on October 12, 2021 and to be a part thereof from the date on which this report is filed, to the extent not superseded by documents or reports subsequently filed or furnished.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| | | |
| Kingsoft Cloud Holdings Limited |
| |
Date: December 23, 2022 | By: | /s/ Haijian He |
| | Name: | Haijian He |
| | Title: | Chief Financial Officer |
d
0.180.370.063347286795365147341536514734153347286795365147341536514734150.180.370.060001795589--12-31false2022-09-3000P2Y
Exhibit 99.1
KINGSOFT CLOUD HOLDINGS LIMITED
INDEX TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
KINGSOFT CLOUD HOLDINGS LIMITED
AUDITED CONSOLIDATED BALANCE SHEET AS OF DECEMBER 31, 2021 AND UNAUDITED INTERIM
CONDENSED CONSOLIDATED BALANCE SHEET AS OF JUNE 30, 2022
(Amounts in thousands of Renminbi (“RMB”) and U.S. dollars (“US$”),
except for number of shares and per share data)
| | | | | | | | |
| | As at |
| | | | December 31, | | June 30, | | June 30, |
| | Notes | | 2021 | | 2022 | | 2022 |
| | | | RMB | | RMB | | US$ |
| | | | | | (unaudited) | | (unaudited) |
| | | | | | | | |
ASSETS | | | | | | | | |
Current assets: | | | | | | | | |
Cash and cash equivalents | | | | 4,217,528 | | 2,732,331 | | 407,926 |
Restricted cash | | | | 239,093 | | 44,439 | | 6,635 |
Accounts receivable, net of allowance for credit losses of RMB32,265 and RMB42,056 (US$6,279) as of December 31, 2021 and June 30, 2022, respectively | | 5 | | 3,570,975 | | 2,872,904 | | 428,913 |
Short-term investments | | | | 2,491,056 | | 2,619,701 | | 391,111 |
Prepayments and other assets | | 6 | | 1,687,021 | | 1,694,048 | | 252,914 |
Amounts due from related parties | | 18 | | 207,143 | | 357,853 | | 53,426 |
Total current assets | | | | 12,412,816 | | 10,321,276 | | 1,540,925 |
Non-current assets: | | | | | | | | |
Property and equipment, net | | 7 | | 2,364,103 | | 2,449,659 | | 365,724 |
Intangible assets, net | | 8 | | 1,169,767 | | 1,086,514 | | 162,212 |
Goodwill | | 9 | | 4,625,115 | | 4,605,724 | | 687,616 |
Prepayments and other assets | | 6 | | 29,066 | | 22,437 | | 3,350 |
Equity investments | | 2 | | 207,166 | | 271,146 | | 40,481 |
Amounts due from related parties | | 18 | | 5,758 | | 4,889 | | 730 |
Deferred tax assets, net | | 13 | | 7,798 | | 13,464 | | 2,010 |
Operating lease right-of-use assets | | 2,10 | | 256,451 | | 225,225 | | 33,625 |
Total non-current assets | | | | 8,665,224 | | 8,679,058 | | 1,295,748 |
Total assets | | | | 21,078,040 | | 19,000,334 | | 2,836,673 |
LIABILITIES, NON-CONTROLLING INTETERSTS AND SHAREHOLDERS’ EQUITY | | | | | | | | |
Current liabilities: | | | | | | | | |
Accounts payable (including accounts payable of the consolidated VIEs and their subsidiaries without recourse to the primary beneficiary of RMB2,733,487 and RMB2,223,417 (US$331,947) as of December 31, 2021 and June 30, 2022, respectively) | | | | 2,938,632 | | 2,409,134 | | 359,674 |
Accrued expenses and other liabilities (including accrued expenses and other liabilities of the consolidated VIEs and their subsidiaries without recourse to the primary beneficiary of RMB1,208,868 and RMB703,730 (US$105,064) as of December 31, 2021 and June 30, 2022, respectively) | | 11 | | 2,223,840 | | 2,748,407 | | 410,326 |
Short-term bank loans (including short-term bank loans of the consolidated VIEs and their subsidiaries without recourse to the primary beneficiary of RMB1,348,166 and RMB1,246,126 (US$186,042) as of December 31, 2021 and June 30, 2022, respectively) | | 12 | | 1,348,166 | | 1,266,270 | | 189,049 |
KINGSOFT CLOUD HOLDINGS LIMITED
AUDITED CONSOLIDATED BALANCE SHEET AS OF DECEMBER 31, 2021 AND UNAUDITED INTERIM
CONDENSED CONSOLIDATED BALANCE SHEET AS OF JUNE 30, 2022 (continued)
(Amounts in thousands of Renminbi (“RMB”) and U.S. dollars (“US$”),
except for number of shares and per share data)
| | | | | | | | |
| | As at |
| | | | December 31, | | June 30, | | June 30, |
| | Notes | | 2021 | | 2022 | | 2022 |
| | | | RMB | | RMB | | US$ |
| | | | | | (unaudited) | | (unaudited) |
| | | | | | | | |
Income tax payable (including income tax payable of the consolidated VIEs and their subsidiaries without recourse to the primary beneficiary of RMB1,026 and RMB2,217 (US$331) as of December 31, 2021 and June 30, 2022, respectively) | | 13 | | 60,217 | | 43,163 | | 6,444 |
Amounts due to related parties (including amounts due to related parties of the consolidated VIEs and their subsidiaries without recourse to the primary beneficiary of RMB797,731 and RMB791,908 (US$118,229) as of December 31, 2021 and June 30, 2022, respectively) | | 18 | | 836,435 | | 826,042 | | 123,325 |
Current operating lease liabilities (including current operating lease liabilities of the consolidated VIEs and their subsidiaries without recourse to the primary beneficiary of RMB70,672 and RMB59,432 (US$8,873) as of December 31, 2021 and June 30, 2022, respectively) | | 2,10 | | 108,590 | | 100,620 | | 15,022 |
Total current liabilities | | | | 7,515,880 | | 7,393,636 | | 1,103,840 |
Non-current liabilities: | | | | | | | | |
Amounts due to related parties (including amounts due to related parties of the consolidated VIEs and their subsidiaries without recourse to the primary beneficiary of RMB472,882 and RMB354,392 (US$52,909) as of December 31, 2021 and June 30, 2022, respectively) | | 18 | | 472,882 | | 354,392 | | 52,909 |
Deferred tax liabilities (including deferred tax liabilities of the consolidated VIEs and their subsidiaries without recourse to the primary beneficiary of RMB nil and RMB nil (US$ nil) as of December 31, 2021 and June 30, 2022, respectively) | | 13 | | 205,889 | | 192,004 | | 28,665 |
Other liabilities (including other liabilities of the consolidated VIEs and their subsidiaries without recourse to the primary beneficiary of RMB6,975 and RMB141,819 (US$21,173) as of December 31, 2021 and June 30, 2022, respectively) | | 11 | | 1,232,677 | | 206,611 | | 30,846 |
Non-current operating lease liabilities (including non-current operating lease liabilities of the consolidated VIEs and their subsidiaries without recourse to the primary beneficiary of RMB121,057 and RMB97,927 (US$14,620) as of December 31, 2021 and June 30, 2022, respectively) | | 2,10 | | 158,289 | | 138,433 | | 20,668 |
Total non-current liabilities | | | | 2,069,737 | | 891,440 | | 133,088 |
Total liabilities | | | | 9,585,617 | | 8,285,076 | | 1,236,928 |
KINGSOFT CLOUD HOLDINGS LIMITED
AUDITED CONSOLIDATED BALANCE SHEET AS OF DECEMBER 31, 2021 AND UNAUDITED INTERIM
CONDENSED CONSOLIDATED BALANCE SHEET AS OF JUNE 30, 2022 (continued)
(Amounts in thousands of Renminbi (“RMB”) and U.S. dollars (“US$”),
except for number of shares and per share data)
| | | | | | | | |
| | As at |
| | | | December 31, | | June 30, | | June 30, |
| | Notes | | 2021 | | 2022 | | 2022 |
| | | | RMB | | RMB | | US$ |
| | | | | | (unaudited) | | (unaudited) |
Shareholders’ equity: | | | | | | | | |
Ordinary shares (par value of US$0.001 per share; 40,000,000,000 shares authorized as of December 31, 2021 and June 30, 2022; 3,805,284,810 and 3,805,284,801 shares issued, 3,646,381,840 and 3,663,417,840 shares outstanding as of December 31, 2021 and June 30, 2022, respectively) | | | | 24,782 | | 24,892 | | 3,716 |
Additional paid-in capital | | | | 18,245,801 | | 18,458,178 | | 2,755,733 |
Accumulated deficit | | | | (7,458,752) | | (8,814,998) | | (1,316,045) |
Accumulated other comprehensive (loss) income | | 20 | | (207,882) | | 175,099 | | 26,142 |
Total Kingsoft Cloud Holdings Limited shareholders’ equity | | | | 10,603,949 | | 9,843,171 | | 1,469,546 |
Non-controlling interests | | | | 888,474 | | 872,087 | | 130,199 |
Total equity | | | | 11,492,423 | | 10,715,258 | | 1,599,745 |
Total liabilities, non-controlling interests and shareholders’ equity | | | | 21,078,040 | | 19,000,334 | | 2,836,673 |
| | | | | | | | |
The accompanying notes are an integral part of the unaudited interim condensed consolidated financial statements.
KINGSOFT CLOUD HOLDINGS LIMITED
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS FOR THE SIX MONTHS
ENDED JUNE 30, 2021 AND 2022
(Amounts in thousands of Renminbi (“RMB”) and U.S. dollars (“US$”),
except for number of shares and per share data)
| | | | | | | | |
| | For the six months ended June 30 |
| | Notes | | 2021 | | 2022 | | 2022 |
| | | | RMB | | RMB | | US$ |
| | | | (unaudited) | | (unaudited) | | (unaudited) |
Revenues: | | 4, 18 | | | | | | |
Public cloud services (including related party amounts of RMB453,024 and RMB563,177 (US$84,080) for the six months ended June 30, 2021 and 2022, respectively) | | | | 2,942,610 | | 2,669,951 | | 398,613 |
Enterprise cloud services (including related party amounts of RMB nil and RMB34,707 (US$5,182) for the six months ended June 30, 2021 and 2022, respectively) | | | | 1,042,177 | | 1,409,083 | | 210,371 |
Others | | | | 2,432 | | 1,273 | | 190 |
Total revenues | | | | 3,987,219 | | 4,080,307 | | 609,174 |
Cost of revenues (including related party amounts of RMB62 and RMB nil (US$ nil) for the six months ended June 30, 2021 and 2022, respectively) | | 18 | | (3,752,234) | | (3,935,145) | | (587,502) |
Gross profit | | | | 234,985 | | 145,162 | | 21,672 |
Operating expenses: | | | | | | | | |
Selling and marketing expenses | | | | (208,884) | | (290,615) | | (43,388) |
General and administrative expenses | | | | (201,814) | | (471,836) | | (70,443) |
Research and development expenses | | | | (496,888) | | (467,579) | | (69,808) |
Total operating expenses | | | | (907,586) | | (1,230,030) | | (183,639) |
Operating loss | | | | (672,601) | | (1,084,868) | | (161,967) |
Interest income | | | | 36,673 | | 38,647 | | 5,770 |
Interest expense | | | | (10,555) | | (68,273) | | (10,193) |
Foreign exchange gain (loss) | | | | 22,902 | | (247,978) | | (37,022) |
Other gain (loss), net | | 4 | | 21,139 | | (27,966) | | (4,175) |
Other income, net | | 4 | | 6,390 | | 20,001 | | 2,986 |
Loss before income taxes | | | | (596,052) | | (1,370,437) | | (204,601) |
Income tax (expense) benefit | | 13 | | (6,755) | | 5,153 | | 769 |
Net loss | | | | (602,807) | | (1,365,284) | | (203,832) |
Less: net income (loss) attributable to non-controlling interests | | | | 11 | | (9,038) | | (1,349) |
Net loss attributable to Kingsoft Cloud Holdings Limited | | | | (602,818) | | (1,356,246) | | (202,483) |
The accompanying notes are an integral part of the unaudited interim condensed consolidated financial statements.
KINGSOFT CLOUD HOLDINGS LIMITED
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS FOR THE SIX MONTHS
ENDED JUNE 30, 2021 AND 2022 (continued)
(Amounts in thousands of Renminbi (“RMB”) and U.S. dollars (“US$”),
except for number of shares and per share data)
| | | | | | | | |
| | For the six months ended June 30 |
| | Notes | | 2021 | | 2022 | | 2022 |
| | | | RMB | | RMB | | US$ |
| | | | (unaudited) | | (unaudited) | | (unaudited) |
Net loss per share: | | | | | | | | |
Basic and diluted | | 16 | | (0.18) | | (0.37) | | (0.06) |
Shares used in the net loss per share computation: | | | | | | | | |
Basic and diluted | | 16 | | 3,347,286,795 | | 3,651,473,415 | | 3,651,473,415 |
Other comprehensive income (loss), net of tax of nil: | | | | | | | | |
Foreign currency translation adjustments | | | | (62,115) | | 382,625 | | 57,124 |
Comprehensive loss | | | | (664,922) | | (982,659) | | (146,708) |
Less: Comprehensive income (loss) attributable to non-controlling interests | | | | 11 | | (9,394) | | (1,402) |
Comprehensive loss attributable to Kingsoft Cloud Holdings Limited shareholders | | | | (664,933) | | (973,265) | | (145,306) |
The accompanying notes are an integral part of the unaudited interim condensed consolidated financial statements.
KINGSOFT CLOUD HOLDINGS LIMITED
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’
EQUITY FOR THE SIX MONTHS ENDED JUNE 30, 2021 AND 2022
(Amounts in thousands of Renminbi (“RMB”) and U.S. dollars (“US$”), except for number of shares)
| | | | | | | | | | | | | | | | |
| | | | | | | | | | | | Total Kingsoft | | | | |
| | | | | | | | Accumulated | | | | Cloud Holdings | | | | |
| | Ordinary shares | | Additional | | other | | | | Limited | | | | Total |
| | Number of | | | | paid-in | | comprehensive | | Accumulated | | shareholders’ | | Non-controlling | | shareholders’ |
| | shares* | | Amount | | capital | | (loss) income | | deficit | | equity | | interests | | equity |
| | | | RMB | | RMB | | RMB | | RMB | | RMB | | RMB | | RMB |
Balance as of December 31, 2020 | | 3,339,618,633 | | 22,801 | | 14,149,984 | | (68,440) | | (5,864,356) | | 8,239,989 | | 61 | | 8,240,050 |
Adoption of ASC 326 | | — | | — | | — | | — | | (5,684) | | (5,684) | | — | | (5,684) |
Net loss for the period | | — | | — | | — | | — | | (602,818) | | (602,818) | | 11 | | (602,807) |
Business acquisition | | — | | — | | — | | — | | — | | — | | 27,258 | | 27,258 |
Other comprehensive loss | | — | | — | | — | | (62,115) | | — | | (62,115) | | — | | (62,115) |
Share-based compensation | | — | | — | | 199,205 | | — | | — | | 199,205 | | — | | 199,205 |
Exercise and vesting of share-based awards | | 16,242,630 | | 106 | | 6,928 | | — | | — | | 7,034 | | — | | 7,034 |
Balance as of June 30, 2021 (unaudited) | | 3,355,861,263 | | 22,907 | | 14,356,117 | | (130,555) | | (6,472,858) | | 7,775,611 | | 27,330 | | 7,802,941 |
Balance as of December 31, 2021 | | 3,646,381,840 | | 24,782 | | 18,245,801 | | (207,882) | | (7,458,752) | | 10,603,949 | | 888,474 | | 11,492,423 |
Net loss for the period | | — | | — | | — | | — | | (1,356,246) | | (1,356,246) | | (9,038) | | (1,365,284) |
Disposal of a subsidiary | | — | | — | | — | | — | | — | | — | | (9,136) | | (9,136) |
Other comprehensive income (loss) | | — | | — | | — | | 382,981 | | — | | 382,981 | | (356) | | 382,625 |
Capital contribution from non-controlling interests | | — | | — | | — | | — | | — | | — | | 2,143 | | 2,143 |
Share-based compensation | | — | | — | | 206,739 | | — | | — | | 206,739 | | — | | 206,739 |
Exercise and vesting of share-based awards | | 17,036,000 | | 110 | | 5,638 | | — | | — | | 5,748 | | — | | 5,748 |
Balance as of June 30, 2022 (unaudited) | | 3,663,417,840 | | 24,892 | | 18,458,178 | | 175,099 | | (8,814,998) | | 9,843,171 | | 872,087 | | 10,715,258 |
Balance as of June 30, 2022, in US$ (unaudited) | | 3,663,417,840 | | 3,716 | | 2,755,733 | | 26,142 | | (1,316,045) | | 1,469,546 | | 130,199 | | 1,599,745 |
* | As of June 30, 2021 and 2022, 190,263,692 and 141,866,961 ordinary shares, respectively, were issued in relation to the share awards. These shares are legally issued but not outstanding. |
The accompanying notes are an integral part of the unaudited interim condensed consolidated financial statements.
KINGSOFT CLOUD HOLDINGS LIMITED
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE SIX MONTHS ENDED
JUNE 30, 2021 AND 2022
(Amounts in thousands of Renminbi (“RMB”) and U.S. dollars (“US$”)
| | | | | | | | |
| | Notes | | For the six months ended June 30 |
| | | | 2021 | | 2022 | | 2022 |
| | | | RMB | | RMB | | US$ |
| | | | (unaudited) | | (unaudited) | | (unaudited) |
CASH FLOWS FROM OPERATING ACTIVITIES | | | | | | | | |
Net loss | | | | (602,807) | | (1,365,284) | | (203,832) |
Adjustments to reconcile net loss to net cash used in operating activities: | | | | | | | | |
Depreciation and amortization | | 7,8 | | 369,589 | | 578,237 | | 86,329 |
Share-based compensation | | 14 | | 199,205 | | 206,739 | | 30,865 |
Provision for credit losses | | | | 17,677 | | 141,331 | | 21,100 |
Gain on disposal of equity investments | | | | (5,651) | | — | | — |
Changes in fair value of financial instruments | | 2,4 | | (15,488) | | 8,825 | | 1,318 |
Impairment of equity investment | | 2,4 | | — | | 5,000 | | 746 |
Changes in fair value of purchase consideration of a business acquisition | | | | — | | 14,018 | | 2,093 |
Impairment of contract costs | | | | — | | 5,336 | | 797 |
Foreign exchange loss (gain) | | | | (22,902) | | 247,978 | | 37,022 |
Deferred income tax | | 13 | | — | | (22,584) | | (3,372) |
Non-cash operating lease expenses | | 10 | | 26,385 | | 36,261 | | 5,414 |
Gain on disposal of property and equipment | | | | (14) | | (3,276) | | (489) |
Loss on disposal of a subsidiary | | | | — | | 123 | | 18 |
Changes in operating assets and liabilities: | | | | | | | | |
Accounts receivable | | | | (1,033,742) | | 564,547 | | 84,286 |
Prepayment and other assets | | | | 70,650 | | 14,289 | | 2,133 |
Amounts due from related parties | | | | 9,310 | | (154,167) | | (23,017) |
Accounts payable | | | | 467,824 | | (504,843) | | (75,371) |
Accrued expenses and other liabilities | | | | (249,439) | | 10,629 | | 1,587 |
Operating lease liabilities | | | | (3,007) | | (32,861) | | (4,906) |
Amounts due to related parties | | | | 7,495 | | (17,584) | | (2,625) |
Income tax payable | | | | 4,114 | | (15,115) | | (2,257) |
Net cash used in operating activities | | | | (760,801) | | (282,401) | | (42,161) |
The accompanying notes are an integral part of the unaudited interim condensed consolidated financial statements.
KINGSOFT CLOUD HOLDINGS LIMITED
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE SIX MONTHS ENDED
JUNE 30, 2021 AND 2022 (continued)
(Amounts in thousands of Renminbi (“RMB”) and U.S. dollars (“US$”)
| | | | | | | | |
| | Notes | | For the six months ended June 30 |
| | | | 2021 | | 2022 | | 2022 |
| | | | RMB | | RMB | | US$ |
| | | | (unaudited) | | (unaudited) | | (unaudited) |
CASH FLOWS FROM INVESTING ACTIVITIES | | | | | | | | |
Purchases of property and equipment | | | | (430,784) | | (1,062,070) | | (158,563) |
Disposals of property and equipment | | | | 91 | | 5,215 | | 779 |
Purchases of intangible assets | | | | (4,388) | | (11,177) | | (1,669) |
Purchases of short-term investments | | | | (1,977,236) | | (2,222,919) | | (331,873) |
Acquisition of equity investments | | | | — | | (63,356) | | (9,459) |
Proceeds from maturities of short-term investments | | | | 2,131,310 | | 2,218,877 | | 331,270 |
Acquisition of business, net of cash acquired | | | | (72,615) | | (130,813) | | (19,530) |
Proceeds from disposal of equity investments | | | | 58,476 | | — | | — |
Disposal of a subsidiary | | | | — | | (2,577) | | (385) |
Asset-related government grants received | | | | 600 | | 11,250 | | 1,680 |
Net cash used in investing activities | | | | (294,546) | | (1,257,570) | | (187,750) |
CASH FLOWS FROM FINANCING ACTIVITIES | | | | | | | | |
Repayment of short-term bank loans | | | | (183,598) | | (573,225) | | (85,580) |
Proceeds from short-term bank loans | | | | 490,018 | | 491,329 | | 73,353 |
Payments of offering costs | | | | — | | (1,458) | | (218) |
Payment of written put options on share repurchases | | 17 | | — | | (33,557) | | (5,010) |
Capital contribution from non-controlling interests | | | | — | | 2,143 | | 320 |
Proceeds from loans due to related parties | | | | 287,850 | | — | | — |
Repayment of loans due to a related party | | | | — | | (110,536) | | (16,503) |
Proceeds from exercise of options | | | | 7,032 | | 10,508 | | 1,569 |
Net cash generated from (used in) financing activities | | | | 601,302 | | (214,796) | | (32,069) |
Effect of exchange rate changes on cash and cash equivalents, and restricted cash | | | | (16,010) | | 74,916 | | 11,185 |
Net decrease in cash and cash equivalents, and restricted cash | | | | (454,045) | | (1,754,767) | | (261,980) |
Cash and cash equivalents, and restricted cash at beginning of period | | | | 3,424,674 | | 4,456,621 | | 665,356 |
Cash and cash equivalents, and restricted cash at end of period | | | | 2,954,619 | | 2,776,770 | | 414,561 |
The accompanying notes are an integral part of the unaudited interim condensed consolidated financial statements.
KINGSOFT CLOUD HOLDINGS LIMITED
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE SIX MONTHS ENDED
JUNE 30, 2021 AND 2022 (continued)
(Amounts in thousands of Renminbi (“RMB”) and U.S. dollars (“US$”)
| | | | | | | | |
| | Notes | | For the six months ended June 30 |
| | | | 2021 | | 2022 | | 2022 |
| | | | RMB | | RMB | | US$ |
| | | | (unaudited) | | (unaudited) | | (unaudited) |
Supplemental disclosures of cash flow information: | | | | | | | | |
Restricted cash | | | | — | | 44,439 | | 6,635 |
Income taxes paid | | | | 2,642 | | 32,547 | | 4,859 |
Interest expense paid | | | | 9,777 | | 69,686 | | 10,404 |
Non-cash investing and financing activities: | | | | | | | | |
Purchases of property and equipment included in accrued expenses and other liabilities | | 11 | | 70,179 | | 264,385 | | 39,472 |
Purchase consideration included in accrued expenses and other liabilities | | 11 | | — | | 1,219,591 | | 182,080 |
Offering costs included in accrued expenses and other liabilities | | | | — | | 26,551 | | 3,964 |
The accompanying notes are an integral part of the unaudited interim condensed consolidated financial statements.
Table of Contents
KINGSOFT CLOUD HOLDINGS LIMITED
NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
(Amounts in thousands of Renminbi (“RMB”) and US dollars (“US$”)
except for number of shares and per share data)
1. | ORGANIZATION AND BASIS OF PRESENTATION |
Kingsoft Cloud Holdings Limited (the “Company”) is a limited liability company incorporated in the Cayman Islands on January 3, 2012. The Company, its subsidiaries, the variable interest entities and subsidiaries of the variable interest entities are hereinafter collectively referred to as the “Group”. The Group is principally engaged in the provision of cloud services. The Company does not conduct any substantive operations on its own but instead conducts its primary business operations through its subsidiaries, variable interest entities, and subsidiaries of the variable interest entities, which are located in the People’s Republic of China (the “PRC”), Hong Kong (“HK”), Japan and the United States (the “U.S.”).
The Company’s principal subsidiaries, variable interest entities, and subsidiaries of its variable interest entities, are as follows:
| | | | | | | | |
| | | | | | Percentage of | | |
| | | | | | equity | | |
| | | | | | interest | | |
| | | | Date of | | attributable | | |
| | Place of | | establishment/ | | to the | | |
Name | | establishment | | acquisition | | Company | | Principal activities |
Subsidiaries: | | | | | | | | |
Kingsoft Cloud Corporation Limited | | HK | | February 1, 2012 | | 100 | % | Cloud services |
Beijing Kingsoft Cloud Technology Co., Ltd. (“Beijing Kingsoft Cloud”)* | | PRC | | April 9, 2012 | | 100 | % | Research and development |
Beijing Yunxiang Zhisheng Technology Co., Ltd. (“Yunxiang Zhisheng”)* | | PRC | | December 15, 2015 | | 100 | % | Research and development |
Camelot Technology Co., Ltd. (“Beijing Camelot”) | | PRC | | September 3, 2021 | | 82.15 | % | Enterprise digital solutions and related services |
Variable interest entities: | | | | | | | | |
Zhuhai Kingsoft Cloud Technology Co., Ltd. (“Zhuhai Kingsoft Cloud”) | | PRC | | November 9, 2012 | | Nil | | Investment holding |
Kingsoft Cloud (Beijing) Information Technology Co., Ltd. (“Kingsoft Cloud Information”) | | PRC | | April 13, 2018 | | Nil | | Investment holding |
Variable interest entities’ subsidiaries: | | | | | | | | |
Kingsoft Cloud (Tianjin) Technology Development Co., Ltd. | | PRC | | May 30, 2019 | | Nil | | Cloud services |
Wuhan Kingsoft Cloud Information Technology Co., Ltd. | | PRC | | December 26, 2017 | | Nil | | Cloud services |
Beijing Kingsoft Cloud Network Technology Co., Ltd. (“Beijing Kingsoft Cloud Network Technology”) | | PRC | | November 9, 2012 | | Nil | | Cloud services |
Beijing Jinxun Ruibo Network Technology Co., Ltd. (“Beijing Jinxun Ruibo”) | | PRC | | December 17, 2015 | | Nil | | Cloud services |
Nanjing Qianyi Shixun Information Technology Co., Ltd. | | PRC | | March 31, 2016 | | Nil | | Cloud services |
* Collectively, the “WFOE”
Table of Contents
KINGSOFT CLOUD HOLDINGS LIMITED
NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS (continued)
(Amounts in thousands of Renminbi (“RMB”) and US dollars (“US$”)
except for number of shares and per share data)
1. | ORGANIZATION AND BASIS OF PRESENTATION (continued) |
These unaudited interim consolidated financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information using accounting policies that are consistent with those used in the preparation of the Company’s audited consolidated financial statements for the year ended December 31, 2021.
In the opinion of management, the accompanying unaudited interim consolidated financial statements contain all normal recurring adjustments necessary to present fairly the financial position, operating results and cash flows of the Company for each of the periods presented. The results of operations for the six months ended June 30, 2022 are not necessarily indicative of results to be expected for any other interim period or for the full year of 2022. The consolidated balance sheet as of December 31, 2021 was derived from the audited consolidated financial statements at that date but does not include all of the disclosures required by U.S. GAAP for annual financial statements. These unaudited interim condensed consolidated financial statements should be read in conjunction with the Company’s consolidated financial statements for the year ended December 31, 2021.
To comply with PRC laws and regulations which prohibit foreign control of companies that engage in value-added telecommunication services, the Group primarily conducts its business in the PRC through its variable interest entities, Zhuhai Kingsoft Cloud and Kingsoft Cloud Information and subsidiaries of its variable interest entities (collectively, the “VIEs”). The equity interests of the VIEs are legally held by PRC shareholders (the “Nominee Shareholders”). Despite the lack of technical majority ownership, the Company through the WFOE has effective control of the VIEs through a series of contractual arrangements (the “Contractual Agreements”). Through the Contractual Agreements, the Nominee Shareholders effectively assigned all of their voting rights underlying their equity interests in the VIEs to the Company and therefore, the Company has the power to direct the activities of the VIEs that most significantly impact its economic performance. The Company also has the ability and obligation to absorb substantially all of the profits and all the expected losses of the VIEs that potentially could be significant to the VIEs. Therefore, the Company is the primary beneficiary of the VIEs. Based on the above, the Company consolidates the VIEs in accordance with SEC Regulation SX-3A-02 and Accounting Standards Codification (“ASC”) 810, Consolidation (“ASC 810”).
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KINGSOFT CLOUD HOLDINGS LIMITED
NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS (continued)
(Amounts in thousands of Renminbi (“RMB”) and US dollars (“US$”)
except for number of shares and per share data)
1. | ORGANIZATION AND BASIS OF PRESENTATION (continued) |
The following table sets forth the assets, liabilities, results of operations and cash flows of the VIEs and VIEs’ subsidiaries included in the Company’s consolidated balance sheets, interim consolidated statements of comprehensive loss and interim consolidated statements of cash flows:
| | | | | | |
| | As at |
| | December 31, | | June 30, | | June 30, |
| | 2021 | | 2022 | | 2022 |
| | RMB | | RMB | | US$ |
| | | |
