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News Releases Ⓒir.yatsenglobal.com / 2021-05-19 - Yatsen - Reports - First - Quarter - 2021 - Financial - Results Conference Call to Be Held at 7:30 A.M. U.S. Eastern Time on May 19 , 2021 GUANGZHOU , China , May 19 , 2021 / PRNewswire / -- Yatsen Holding Limited ( " Yatsen " or the " Company " ) ( NYSE : YSG ) , a leader in the rapidly evolving China beauty market , today announced its unaudited financial results for the first quarter ended March 31 , 2021 . First Quarter 2021 Highlights • Total net revenues for the first quarter 2021 increased 42.7 % to RMB1.44 bill ( US $ 220.5 million ) from RMB1.01 billion for the first quarter of 2020 . • Gross margin for the first quarter of 2021 was 68.6 % compared to 61.7 % for the first quarter of 2020 . • Gross sales [ ¹ ] for the first quarter of 2021 increased 47.0 % to RMB1.69 billion ( US $ 257.3 million ) from RMB1.15 billion for the first quarter of 2020 . • The number of Direct - to - Consumer ( " DTC " ) customers [ 2 ] for the first quarter of 2021 increased 11.6 % to 9.6 million from 8.6 million for the first quarter of 2020 . Average net revenue per DTC customer [ ³ ] for the first quarter of 2021 increased 24.5 % to RMB 122.9 from RMB98.7 for the first quarter of 2020 . Mr. Jinfeng Huang , founder , Chairman and Chief Executive Officer of Yatsen , said , " The year is off to a good start with robust topline growth and continued execution of our multi - brand strategy . Growth in the quarter was driven by stellar performance of our flagship Perfect Diary brand as well as robust growth from Little Ondine , Abby's Choice and other brands under Yatsen's portfolio . We are especially pleased to see increases in revenue per DTC user and gross margin driven by brand premiumization and disciplined pricing and discounts policies . " The launch of our mass market cosmetics brand Pink Bear as well as the acquisition of Eve Lom and DR.WU's mainland China business this quarter propelled our brand portfolio expansion . While we are still in early stages of integration for our newly acquired brands , we already saw signs of success with the relaunch of certain hero products within the Galénic and DR . WU portfolio . Building on our momentum in the first quarter , we will continue to leverage our current unique window of opportunity to identify valuable brands and businesses to further enrich our portfolio and invest in critical research and development and infrastructure capabilities to sustain our competitive advantage over the long term . " Mr. Donghao Yang , Chief Financial Officer and Director of Yatsen , commented , " We have had a solid start to the year , with total net revenues exceeding our guidance to reach RMB1.44 billion , a 42.7 % year - over - year increase . As our top line expands , our gross margin also improved to 68.6 % compared to 61.7 % in the same period last year . We believe our leading market position and stellar operating performance position us well to achieve our strategic objectives this year and further capture the growth potential of China's beauty market . " First Quarter 2021 Financial Results Net Revenues . Total net revenues for the first quarter of 2021 increased by 42.7 % to RMB1.44 billion ( US $ 220.5 million ) from RMB1.01 billion for the first quarter of 2020 , primarily attributable to ( i ) an increase in DTC customers and revenue per DTC customer during the period , ( ii ) an increase in sales from increasingly diversified sales channels , and ( iii ) an increase in the sales contributed by our newly launched and acquired brands . Gross Profit and Gross Margin.Gross profit for the first quarter of 2021 increased by 58.8 % to RMB991.6 million ( US $ 151.3 million ) from RMB624.4 million for the first quarter of 2020. Gross margin for the first quarter of 2021 was 68.6 % compared to 61.7 % for the first quarter of 2020 , attributable to ( i ) disciplined pricing and discounts policies , ( ii ) premiumization of our Perfect Diary brand , and ( iii ) increased sales generated from higher margin brands and through experience stores . Operating Expenses . Total operating expenses for the first quarter of 2021 were RMB1.33 billion ( US $ 203.7 million ) , compared to RMB800.3 million for the first quarter of 2020. As a percentage of total net revenues , total operating expenses for the first quarter of 2021 were 92.4 % , compared to 79.1 % for the first quarter of 2020 . • Fulfillment Expenses . Fulfillment expenses for the first quarter of 2021 were RMB92.7 million ( US $ 14.2 million ) , compared to RMB107.1 million for the first quarter of 2020. As a percentage of total net revenues , fulfillment expenses for the first quarter of 2021 decreased to 6.4 % from 10.6 % for the first quarter of 2020. The decrease in percentage was primarily due to the normalization of logistics expense compared to the first quarter of 2020 during which logistics expenses were higher due to impacts from the COVID 19 pandemic . Selling and Marketing Expenses . Selling and marketing expenses for the first quarter of 2021 were RMB1.04 billion ( US $ 159.1 million ) , compared to RMB556.9 million for the first quarter of 2020. As a percentage of total net revenues , selling and marketing expenses for the first quarter of 2021 increased to 72.1 % from 55.0 % for the first quarter of 2020. The increase in percentage was primarily due to ( i ) investment in promotions and consumer awareness - building for the newer brands , and ( ii ) testing of the effectiveness of new traffic acquisition channels . • General and Administrative Expenses . General and administrative expenses for the first quarter of 2021 were RMB172.3 million ( US $ 26.3 million ) , compared to RMB 124.1 million for the first quarter of 2020. As a percentage of total net reven es , gener and administrative expenses for the first quarter of 2021 decreased to 11.9 % from 12.3 % for the first quarter of 2020. The decrease in percentage was primarily due to increased economy of scale resulting from a higher level of revenue . 1/9