omniture

Ctrip Reports Unaudited Second Quarter of 2015 Financial Results

2015-08-04 06:00 2425

SHANGHAI, August 4, 2015 /PRNewswire/ -- Ctrip.com International, Ltd. (Nasdaq: CTRP), a leading travel service provider of accommodation reservation, transportation ticketing, packaged tours and corporate travel management in China ("Ctrip" or the "Company"), today announced its unaudited financial results for the second quarter ended June 30, 2015.

Highlights for the Second Quarter of 2015

  • Net revenues were RMB2.53 billion (US$408 million) for the second quarter of 2015, up 47% year-on-year.
  • Net commission earned (non-GAAP) was RMB2.49 billion for the second quarter, up 45% year-on-year. Net commission earned (non-GAAP) is calculated by deducting from the revenues the cost of transactions where the Company undertakes majority of the business risks, including the inventory risks*. The Company accounts for discount offered to the customers as reduction to its revenues, and certain significant discount may result in selling price lower than cost.
  • Accommodation reservation volume increased 55% year-on-year, and accommodation reservation revenues increased 47% year-on-year, reaching RMB1.1 billion (US$178 million) for the second quarter of 2015.
  • Transportation ticketing volume increased 106% year-on-year, and transportation ticketing revenues increased 45% year-on-year, reaching RMB1.1 billion (US$170 million) for the second quarter of 2015.
  • Gross margin was 71% for the second quarter of 2015, compared to 72% in the same period in 2014, and 70% in the previous quarter.
  • Net income attributable to Ctrip's shareholders was RMB143 million (US$23 million) for the second quarter of 2015, compared to RMB135 million (US$22 million) in the same period in 2014. Excluding share-based compensation charges (non-GAAP), net income attributable to Ctrip's shareholders was RMB296 million (US$48 million), compared to RMB246 million (US$40 million) in the same period in 2014.
  • Diluted earnings per ADS were RMB0.90 (US$0.15) for the second quarter of 2015. Excluding share-based compensation charges (non-GAAP), diluted earnings per ADS were RMB1.86 (US$0.30) for the second quarter of 2015.
  • Share-based compensation charges were RMB153 million (US$25 million), accounting for 6% of the net revenues, or RMB0.96 (US$0.15) per ADS for the second quarter of 2015.

*

The Company presents the revenue on a net basis. Revenues are recognized at gross basis when the Company undertakes the majority of the business risks and acts as principal. In the second quarter of 2015, the Company recognized the revenue on gross basis of RMB0.05 billion and associated cost of RMB0.04 billion. Should all these transactions being presented on net basis, the net commission earned was RMB2.49 billion.

"We saw continued robust growth across all business lines," said James Liang, Chairman of the Board and Chief Executive Officer of Ctrip. "Both our accommodation reservation and transportation ticketing businesses reached record-high revenues of over RMB1 billion, a landmark achievement in China's online travel industry. Accommodation reservation, air ticketing and transportation ticketing maintained strong year-over-year volume growth of 55%, 60% and 106% respectively, with high revenue quality and sales and marketing efficiency. Such performance, coupled with increased revenue generation and improved cost control of our new businesses, has allowed us to remain the most profitable travel company in China. We will continue to enhance our core competencies, strengthen our leadership and strive for a balance between investment and profitability in the coming quarters."

Second Quarter of 2015 Financial Results and Business Updates

For the second quarter of 2015, Ctrip reported total revenues of RMB2.7 billion (US$430 million), representing a 46% increase from the same period in 2014. Total revenues for the second quarter of 2015 increased by 9% from the previous quarter.

Accommodation reservation revenues amounted to RMB1.1 billion (US$178 million) for the second quarter of 2015, representing a 47% increase year-on-year, primarily driven by an increase of 55% in accommodation reservation volume. Accommodation reservation revenues increased by 16% quarter-on-quarter.

Transportation ticketing revenues for the second quarter of 2015 were RMB1.1 billion (US$170 million), representing a 45% increase year-on-year, primarily driven by an increase of 106% in ticketing volume. Transportation ticketing revenues increased by 11% quarter-on-quarter.

Packaged-tour revenues for the second quarter of 2015 were RMB329 million (US$53 million), representing a 61% increase year-on-year, primarily driven by an increase in volume growth of organized tours and self-guided tours. Packaged-tour revenues decreased by 17% quarter-on-quarter, primarily due to seasonality.

Corporate travel revenues for the second quarter of 2015 were RMB121 million (US$19 million), representing a 34% increase year-on-year, primarily driven by the increased corporate travel demand from business activities. Corporate travel revenues increased by 30% quarter-on-quarter, primarily due to seasonality.

For the second quarter of 2015, net revenues were RMB2.5 billion (US$408 million), representing a 47% increase from the same period in 2014. Net revenues for the second quarter of 2015 increased by 9% from the previous quarter.

Gross margin was 71% for the second quarter of 2015, compared to 72% in the same period in 2014 and 70% in the previous quarter.

Product development expenses for the second quarter of 2015 increased by 66% to RMB797 million (US$128 million) from the same period in 2014, primarily due to an increase in product development personnel related expenses. Product development expenses for the second quarter of 2015 decreased by 1% from the previous quarter. Excluding share-based compensation charges (non-GAAP), product development expenses accounted for 29% of the net revenues, increased from 25% in the same period in 2014 and decreased from 32% in the previous quarter.

Sales and marketing expenses for the second quarter of 2015 increased by 42% to RMB679 million (US$109 million) from the same period in 2014, primarily due to an increase in sales and marketing related activities. Sales and marketing expenses for the second quarter of 2015 decreased by 6% from the previous quarter. Excluding share-based compensation charges (non-GAAP), sales and marketing expenses accounted for 26% of the net revenues, decreased from 27% in the same period in 2014 and 30% in the previous quarter.

General and administrative expenses for the second quarter of 2015 increased by 34% to RMB261 million (US$42 million) from the same period in 2014 primarily due to an increase in amortization expenses for intangible assets of newly acquired entities and other office expenses. General and administrative expenses for the second quarter of 2015 increased by 1% from the previous quarter. Excluding share-based compensation charges (non-GAAP), general and administrative expenses accounted for 8% of the net revenues, remained consistent with the same period in 2014 and the previous quarter.

Income from operations for the second quarter of 2015 was RMB61 million (US$10 million), compared to RMB91 million (US$15 million) in the same period in 2014 and loss from operations of RMB180 million (US$29 million) in the previous quarter. Excluding share-based compensation charges (non-GAAP), income from operations was RMB214 million (US$35 million), compared to RMB202 million (US$33 million) in the same period in 2014 and loss from operations of RMB21 million (US$3 million) in the previous quarter.

Operating margin was 2% for the second quarter of 2015, compared to 5% in the same period in 2014, and -8% in the previous quarter. Excluding share-based compensation charges (non-GAAP), operating margin was 8%, compared to 12% in the same period in 2014 and -1% in the previous quarter.

Income tax expense for the second quarter of 2015 was RMB31 million (US$5 million), compared to income tax expense of RMB47 million (US$8 million) in the same period of 2014 and RMB6 million (US$1 million) in the previous quarter.

Net income attributable to Ctrip's shareholders for the second quarter of 2015 was RMB143 million (US$23 million), compared to RMB135 million (US$22 million) in the same period in 2014 and net loss attributable to Ctrip's shareholders of RMB126 million (US$20 million) in the previous quarter. Excluding share-based compensation charges (non-GAAP), net income attributable to Ctrip's shareholders was RMB296 million (US$48 million), compared to RMB246 million (US$40 million) in the same period in 2014 and RMB33 million (US$5 million) in the previous quarter.

Diluted earnings per ADS were RMB0.90 (US$0.15) for the second quarter of 2015. Excluding share-based compensation charges (non-GAAP), diluted earnings per ADS were RMB1.86 (US$0.30) for the second quarter of 2015.

As of June 30, 2015, the balance of cash and cash equivalents, restricted cash and short-term investment was RMB20.5 billion (US$3.3billion).

Recent Development

As of August 3, 2015, Ctrip had purchased approximately 20 million ADSs in aggregate with a total consideration of US$474 million.

Business Outlook

For the third quarter of 2015, the Company expects to continue the net revenue growth year-on-year at a rate of approximately 45-50%. This forecast reflects Ctrip's current and preliminary view, which is subject to change.

Conference Call

Ctrip's management team will host a conference call at 8:00PM U.S. Eastern Time on August 3, 2015 (or 8:00AM on August 4, 2015 in the Shanghai/Hong Kong Time) following the announcement.

The conference call will be available on Webcast live and replay at: http://ir.ctrip.com. The call will be archived for one month at this website.

The dial-in details for the live conference call: U.S. Toll Free Number +1.800.230.3019, International dial-in number +1.617.597.5413, Passcode 40828276#. For pre-registration, please click

https://www.theconferencingservice.com/prereg/key.process?key=PR96NW7LY.

A telephone replay of the call will be available after the conclusion of the conference call until August 10, 2015. The dial-in details for the replay: U.S. Toll Free Number +1.888.286.8010, International dial-in number +1.617.801.6888, Passcode 50047076.

Safe Harbor Statement

This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "may," "will," "expect," "anticipate," "future," "intend," "plan," "believe," "estimate," "is/are likely to," "confident" or other similar statements. Among other things, quotations from management and the Business Outlook section in this press release, as well as Ctrip's strategic and operational plans, contain forward-looking statements. Ctrip may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission, in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Forward-looking statements involve inherent risks and uncertainties. A number of important factors could cause actual results to differ materially from those contained in any forward-looking statement. Potential risks and uncertainties include, but are not limited to, severe or prolonged downturn in the global or Chinese economy, general declines or disruptions in the travel industry, volatility in the trading price of Ctrip's ADSs, Ctrip's reliance on its relationships and contractual arrangements with travel suppliers and strategic alliances, failure to further increase Ctrip's brand recognition to obtain new business partners and consumers, failure to compete against new and existing competitors, failure to successfully manage current growth and potential future growth, risks associated with any strategic investments or acquisitions, seasonality in the travel industry in mainland China, Hong Kong, Macau or Taiwan, failure to successfully develop Ctrip's corporate travel business, damage to or failure of Ctrip's infrastructure and technology, loss of services of Ctrip's key executives, adverse changes in economic and political policies of the PRC government, inflation in China, risks and uncertainties associated with PRC laws and regulations with respect to the ownership structure of Ctrip's affiliated Chinese entities and the contractual arrangements among Ctrip, its affiliated Chinese entities and their shareholders, and other risks outlined in Ctrip's filings with the U.S. Securities and Exchange Commission, including its annual report on Form 20-F and other filings. All information provided in this press release and in the attachments is as of the date of the issuance, and Ctrip does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

About Non-GAAP Financial Measures

To supplement Ctrip's unaudited condensed consolidated financial statements presented in accordance with United States Generally Accepted Accounting Principles ("GAAP"), Ctrip uses non-GAAP financial information related to product development expenses, sales and marketing expenses, general and administrative expenses, income from operations, operating margin, net income, and diluted earnings per ordinary share and per ADS, each of which is adjusted from the most comparable GAAP result to exclude the share-based compensation charges recorded under ASC 718, "Compensation-Stock Compensation" for 2015 and 2014. Ctrip's management believes the non-GAAP financial measures facilitate better understanding of operating results from quarter to quarter and provide management with a better capability to plan and forecast future periods.

Non-GAAP information is not prepared in accordance with GAAP and may be different from non-GAAP methods of accounting and reporting used by other companies. The presentation of this additional information should not be considered a substitute for GAAP results. A limitation of using non-GAAP financial measures is that non-GAAP measures exclude share-based compensation charges that have been and will continue to be significant recurring expenses in Ctrip's business for the foreseeable future.

Reconciliations of Ctrip's non-GAAP financial data to the most comparable GAAP data included in the consolidated statement of operations are included at the end of this press release.

About Ctrip.com International, Ltd.

Ctrip.com International, Ltd. is a leading travel service provider of accommodation reservation, transportation ticketing, packaged tours, and corporate travel management in China. It is the largest online consolidator of accommodations and transportation tickets in China in terms of transaction volume. Ctrip enables business and leisure travelers to make informed and cost-effective bookings by aggregating comprehensive travel related information and offering its services through an advanced transaction and service platform consisting of its mobile apps, Internet websites and centralized, toll-free, 24-hour customer service center. Ctrip also helps customers book vacation packages and guided tours. In addition, through its corporate travel management services, Ctrip helps corporate clients effectively manage their travel requirements. Since its inception in 1999, Ctrip has experienced substantial growth and become one of the best-known travel brands in China.

For further information, please contact:

Investor Relations

Ctrip.com International, Ltd.
Tel: (+86) 21 3406 4880 X 12928
Email: iremail@ctrip.com

Ctrip.com International, Ltd.

Unaudited Condensed Consolidated Balance Sheets


























December 31, 2014



June 30, 2015



June 30, 2015



RMB

RMB

USD















(unaudited)



(unaudited)



(unaudited)




ASSETS











Current assets:











Cash and cash equivalents


5,300,887,799



12,923,666,794



2,084,462,386



Restricted cash


836,394,951



1,167,673,256



188,334,396



Short-term investment


6,438,854,587



6,401,326,452



1,032,472,008



Accounts receivable, net


1,826,765,949



2,708,586,983



436,868,868



Prepayments and other current assets


2,480,276,272



3,223,484,751



519,916,895



Deferred tax assets, current


193,503,366



271,169,275



43,736,980














Total current assets


17,076,682,924



26,695,907,511



4,305,791,533














Long-term deposits and prepayments


306,661,011



415,450,333



67,008,118



Land use rights


104,568,868



103,719,867



16,729,011



Property, equipment and software


5,220,626,461



5,351,060,515



863,074,277



Investment


5,318,756,447



8,558,036,064



1,380,328,397



Goodwill


1,892,507,708



2,535,966,703



409,026,888



Intangible assets


668,202,371



1,063,545,732



171,539,634



Other long-term receviables


702,911,223



1,018,119,578



164,212,835














Total assets


31,290,917,013



45,741,806,303



7,377,710,693














LIABILITIES











Current liabilities:











Short-term Debt *


3,560,488,641



5,924,906,000



955,630,000



Accounts payable


2,304,111,525



3,794,225,569



611,971,866



Salary and welfare payable


525,157,105



694,199,366



111,967,640



Taxes payable


339,452,319



416,539,458



67,183,784



Advances from customers


3,937,477,522



4,767,922,969



769,019,834



Accrued liability for customer reward program


430,852,908



542,975,155



87,576,638



Other payables and accruals


1,617,162,761



1,546,024,508



249,358,789














Total current liabilities


12,714,702,781



17,686,793,025



2,852,708,551














Deferred tax liabilities, non-current


132,506,644



213,202,920



34,387,568



Long-term Debt


8,065,980,000



16,430,000,000



2,650,000,000














Total liabilities


20,913,189,425



34,329,995,945



5,537,096,119














SHAREHOLDERS' EQUITY











Share capital


3,085,272



3,122,255



503,590



Additional paid-in capital


4,828,021,816



5,000,430,292



806,521,015



Statutory reserves


134,098,747



134,098,747



21,628,830



Accumulated other comprehensive income


443,579,376



889,959,877



143,541,916



Retained Earnings


5,726,024,997



5,742,816,738



926,260,764



Treasury stock


(1,605,630,913)



(2,071,146,999)



(334,055,968)














Total Ctrip's shareholders' equity


9,529,179,295



9,699,280,910



1,564,400,147














Noncontrolling interests


848,548,293



1,712,529,448



276,214,427














Total shareholders' equity


10,377,727,588



11,411,810,358



1,840,614,574














Total liabilities and shareholders' equity


31,290,917,013



45,741,806,303



7,377,710,693














* Short-term Debt represents short-term borrowings from commercial banks and Convertible Senior Notes which may be redemeed within one year




Ctrip.com International, Ltd.

Unaudited Condensed Consolidated Statements of Comprehensive Income
































Quarter Ended



Quarter Ended



Quarter Ended



Quarter Ended



June 30, 2014

March 31, 2015

June 30, 2015

June 30, 2015



RMB

RMB

RMB

USD

















(unaudited)



(unaudited)



(unaudited)



(unaudited)




Revenues:














Accommodation reservation **


752,565,453



951,779,930



1,104,440,783



178,135,610



Transportation ticketing ***


725,513,462



947,907,791



1,052,550,664



169,766,236



Packaged tour


205,141,896



395,912,244



329,373,989



53,124,837



Corporate travel


90,442,575



92,713,417



120,746,346



19,475,217



Others


45,842,408



54,989,178



58,377,132



9,415,666

















Total revenues


1,819,505,794



2,443,302,560



2,665,488,914



429,917,566

















Less: business tax and related surcharges


(97,244,864)



(128,526,318)



(138,352,668)



(22,314,946)

















Net revenues


1,722,260,930



2,314,776,242



2,527,136,246



407,602,620

















Cost of revenues


(478,601,393)



(704,606,314)



(730,019,031)



(117,745,005)

















Gross profit


1,243,659,537



1,610,169,928



1,797,117,215



289,857,615

















Operating expenses:














Product development *


(479,262,194)



(808,446,542)



(796,503,880)



(128,468,368)



Sales and marketing *


(479,274,011)



(722,504,606)



(678,719,875)



(109,470,948)



General and administrative *


(194,203,673)



(259,486,138)



(261,010,168)



(42,098,414)

















Total operating expenses


(1,152,739,878)



(1,790,437,286)



(1,736,233,923)



(280,037,730)

















Income/(loss) from operations


90,919,659



(180,267,358)



60,883,292



9,819,885

















Interest income ****


83,277,622



62,633,910



136,364,251



21,994,234



Interest expense ****


(33,693,033)



(53,078,347)



(58,841,079)



(9,490,497)



Other income/(expense)


5,265,556



(15,496,474)



11,924,843



1,923,362

















Income/(loss) before income tax expense and equity in income


145,769,804



(186,208,269)



150,331,307



24,246,984

















Income tax expense


(47,090,068)



(6,289,394)



(31,322,795)



(5,052,064)



Equity in income/(loss) of affiliates


13,215,687



9,391,560



(20,479,317)



(3,303,116)

















Net income/(loss)


111,895,423



(183,106,103)



98,529,195



15,891,804

















Less: Net loss attributable to noncontrolling interests


22,992,757



57,119,422



44,249,227



7,136,972

















Net income/(loss) attributable to Ctrip's shareholders


134,888,180



(125,986,681)



142,778,422



23,028,776

















Comprehensive income/(loss) attributable to Ctrip's shareholders


260,740,944



(245,666,783)



708,839,025



114,328,875

















Earnings per ordinary share














- Basic


3.97



(3.58)



4.01



0.65



- Diluted


3.51



(3.58)



3.61



0.58

















Earnings per ADS














- Basic


0.99



(0.90)



1.00



0.16



- Diluted


0.88



(0.90)



0.90



0.15

















Weighted average ordinary shares outstanding














- Basic


33,952,472



35,178,644



35,646,304



35,646,304



- Diluted


39,339,689



35,178,644



39,940,625



39,940,625

















* Share-based compensation charges included are as follows:














Product development


41,555,508



69,471,054



71,542,652



11,539,137



Sales and marketing


11,715,564



17,634,267



16,189,635



2,611,231



General and administrative


58,066,756



71,805,377



65,361,658



10,542,203

















** Accommodation reservation revenues mainly represent revenues from reservations of hotels, hostels, vacation rentals and other accommodation related services.
















*** Transportation ticketing revenues mainly represent revenues from reservations of air tickets, railway tickets and other transportation related services.
















**** Interest expenses are separately presented and have been reclassified from interest income, net with no effect on net income or retained earnings.

Ctrip.com International, Ltd.

Reconciliation of GAAP and Non-GAAP Results

(In RMB, except % and per share information)

























Quarter Ended June 30, 2015




GAAP Result

% of Net Revenues


Share-based Compensation

% of Net Revenues


Non-GAAP Result

% of Net Revenues














Product development

(796,503,880)

32%


71,542,652

3%


(724,961,228)

29%



Sales and marketing

(678,719,875)

27%


16,189,635

1%


(662,530,240)

26%



General and administrative

(261,010,168)

10%


65,361,658

2%


(195,648,510)

8%



Total operating expenses

(1,736,233,923)

69%


153,093,945

6%


(1,583,139,978)

63%














Income/(loss) from operations

60,883,292

2%


153,093,945

6%


213,977,237

8%














Net income/(loss) attributable to Ctrip's shareholders

142,778,422

6%


153,093,945

6%


295,872,367

12%














Diluted earnings per ordinary share (RMB)

3.61



3.80



7.41















Diluted earnings per ADS (RMB)

0.90



0.96



1.86















Diluted earnings per ADS (USD)

0.15



0.15



0.30



























Quarter Ended March 31, 2015




GAAP Result

% of Net Revenues


Share-based Compensation

% of Net Revenues


Non-GAAP Result

% of Net Revenues














Product development

(808,446,542)

35%


69,471,054

3%


(738,975,488)

32%



Sales and marketing

(722,504,606)

31%


17,634,267

1%


(704,870,339)

30%



General and administrative

(259,486,138)

11%


71,805,377

3%


(187,680,761)

8%



Total operating expenses

(1,790,437,286)

77%


158,910,698

7%


(1,631,526,588)

70%














Income from operations

(180,267,358)

-8%


158,910,698

7%


(21,356,660)

-1%














Net income attributable to Ctrip's shareholders

(125,986,681)

-5%


158,910,698

7%


32,924,017

2%














Diluted earnings per ordinary share (RMB)

(3.58)



4.52



0.94















Diluted earnings per ADS (RMB)

(0.90)



1.13



0.23















Diluted earnings per ADS (USD)

(0.15)



0.19



0.04



























Quarter Ended June 30, 2014




GAAP Result

% of Net Revenues


Share-based Compensation

% of Net Revenues


Non-GAAP Result

% of Net Revenues














Product development

(479,262,194)

28%


41,555,508

2%


(437,706,686)

25%



Sales and marketing

(479,274,011)

28%


11,715,564

1%


(467,558,447)

27%



General and administrative

(194,203,673)

11%


58,066,756

3%


(136,136,917)

8%



Total operating expenses

(1,152,739,878)

67%


111,337,828

6%


(1,041,402,050)

60%














Income from operations

90,919,659

5%


111,337,828

6%


202,257,487

12%














Net income attributable to Ctrip's shareholders

134,888,180

8%


111,337,828

6%


246,226,008

14%














Diluted earnings per ordinary share (RMB)

3.51



2.83



6.34















Diluted earnings per ADS (RMB)

0.88



0.70



1.58















Diluted earnings per ADS (USD)

0.14



0.12



0.26


























Notes for all the condensed consolidated financial schedules presented:













Note 1: The conversion of Renminbi (RMB) into U.S. dollars (USD) is based on the certified exchange rate of USD1.00=RMB6.2 on June 30, 2015 published by the Federal Reserve Board.




To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/ctrip-reports-unaudited-second-quarter-of-2015-financial-results-300122702.html

Source: Ctrip.com International, Ltd.
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