China's Luckin Coffee Inc. this week released its restated unaudited financial results for the second and third quarters ended Jun. 30, 2019, and Sept. 30, 2019, as well as the unaudited results for the fourth quarter ended Dec. 31, 2019. The release of these restated financial reports sheds light on Luckin's accounting fraud committed more than two years ago.
The report shows Luckin's fraudulent transactions began in April 2019, when it inflated operating income by RMB 2.12 billion ($327.7 million) for all of 2019. Its revenue inflation rose throughout the year, totaling RMB 250 million ($38.6 million) in the second quarter of 2019, RMB 700 million ($108.2 million) in the third quarter and RMB 1.17 billion ($172.6 million) in the fourth quarter.
“Today’s disclosure represents an important milestone for Luckin Coffee as we execute on our plan to return to normalized financial reporting," Luckin Coffee chairman and chief executive Dr. Jinyi Guo.
"We have worked diligently to remediate the accounting issues that have delayed our financial filings and led to the review and correction of our historical financial information," Guo continued. “Today, we have a new leadership team and a viable plan that is driving growth for Luckin Coffee and long-term value creation for our shareholders.
"Across the company, our team remains focused on delivering improved financial and operational performance while delivering outstanding products and services for our customers," Guo summed up.
Click here to see Luckin Coffee's restated financial results.
