SHANGHAI, Aug. 11 /PRNewswire-Asia/ -- Home Inns & Hotels Management Inc. (Nasdaq: HMIN), a leading economy hotel chain in China, today announced its unaudited financial results for the second quarter ended June 30, 2010.
Second Quarter 2010 Financial Highlights
-- Total revenues for the second quarter increased 25.7% year over year to
RMB 806.9 million (US$119.0 million), at the higher end of the guidance
range of RMB 790 million to RMB 810 million.
-- Net income attributable to Home Inns' shareholders for the quarter was
RMB 135.8 million (US$20.0 million), including share-based compensation
expenses of RMB 14.0 million (US$2.1 million), gain on buy-back of
convertible bonds of RMB 2.0 million (US$0.3 million) and foreign
exchange loss of RMB 0.5 million (US$0.07 million). This compares to a
net income attributable to Home Inns' shareholders of RMB 100.4 million
(US$14.7 million) in the second quarter of 2009, which included gain on
buy-back of convertible bonds of RMB 46.5 million (US$6.8 million),
share-based compensation expenses of RMB 6.4 million (US$0.9 million)
and foreign exchange loss of RMB 0.3 million (US$0.04 million).
-- Income from operations for the quarter was RMB 173.9 million (US$25.6
million), compared to that of RMB 67.7 million (US$9.9 million) in the
same period of 2009. Income from operations excluding share-based
compensation expenses (non-GAAP) was RMB 188.0 million (US$27.7 million)
for the quarter, compared to RMB 74.1 million (US$10.9 million) in the
same period of 2009.
-- EBITDA (non-GAAP) for the quarter was RMB 261.6 million (US$38.6
million). Excluding gain from buy-back of convertible bonds, foreign
exchange loss and share-based compensation expenses, adjusted EBITDA
(non-GAAP) for the quarter was RMB 274.2 million (US$40.4 million),
compared to RMB 149.0 million (US$21.8 million) in the same period of
2009, representing a year-over-year increase of 84.0%.
-- Diluted earnings per ADS for the quarter were RMB 3.18 (US$0.47), while
adjusted diluted earnings per ADS (non-GAAP) for the quarter were RMB
3.52 (US$0.52).
Diluted earnings per ADS and adjusted diluted earnings per ADS (non-GAAP) exclude gain on buy-back of convertible bonds. Adjusted diluted earnings per ADS (non-GAAP) also exclude foreign exchange loss and share-based compensation expenses. Please refer to "Reconciliations of GAAP and Non-GAAP Results" at the end of this press release.
"We have once again delivered a solid quarter. The performance of our entire network improved both year over year and sequentially across all key measures, and our Shanghai-based hotels brought in a better-than-expected premium from the Shanghai World Expo," said Mr. David Sun, Home Inns' Chief Executive Officer. "Our strong results were supported by the steady Chinese economic recovery and increasing domestic travel. Our overall occupancy rate for the quarter exceeded 96% even as we put into effect price increases at the majority of our mature hotels."
Operational Highlights
-- During the second quarter of 2010, Home Inns opened a net of 36
franchised-and-managed hotels. As of June 30, 2010, the Home Inns
hotel chain operated 674 hotels across 126 cities in China, of which
390 were leased-and-operated hotels, including one H Hotel (Home Inns'
premium brand hotel), and 284 were franchised-and-managed hotels. The
average number of guest rooms per hotel was 116.
-- In addition, Home Inns had 34 leased-and-operated hotels and 64
franchised-and-managed hotels contracted or under construction as of
June 30, 2010.
-- As of June 30, 2010, Home Inns had 3.02 million active non-corporate
members, representing a 62% increase from 1.87 million as of June 30,
2009. Room nights sold to non-corporate members consistently represent
over 50% of total room nights sold.
-- The occupancy rate for all hotels in operation was 96.4% in the second
quarter of 2010, compared with 92.4% in the same period in 2009 and
90.5% in the previous quarter. The year-over-year increase was mainly
due to continued improvements and stabilization in macroeconomic
conditions in China and a less dilutive impact due to fewer new hotels
opened this year. The sequential increase in occupancy resulted from
normal seasonality as business activities increased from the first
quarter post Chinese New Year.
-- RevPAR, defined as revenue per available room, was RMB 171 in the
second quarter of 2010, compared with RMB 148 in the same period in
2009 and RMB 144 in the previous quarter. The RevPAR increase year
over year was attributable to a higher occupancy rate as well as a
higher average daily rate, or ADR. Starting in the middle of March
2010 and continuing throughout the second quarter, upward price
adjustments were implemented at most of the mature hotels.
-- RevPAR for Home Inns' hotels that had been in operation for at least 18
months was RMB 176 for the second quarter of 2010, compared to RMB 152
for the same group of hotels in the second quarter of 2009. This
positive comparison was attributable to both higher occupancy rate and
higher ADR.
"As we continue to ramp up our development activities following the economic slow-down that lasted throughout the first half of 2009, our new hotel pipeline has become more robust. Based on current visibility, we are confident to open net 65-70 leased-and-operated hotels and 130-135
franchised-and-managed hotels in 2010," continued Mr. Sun. "Our cash performance continued to strengthen. For the past five quarters, we have generated positive operating cash flow minus capital expenditures allowing us to self-fund a profitable growth strategy now and well into the foreseeable future."
Second Quarter 2010 Financial Results
For the second quarter of 2010, Home Inns' total revenues increased by 25.7% year over year to RMB 806.9 million (US$119.0 million).
Total revenues from leased-and-operated hotels for the second quarter of 2010 were RMB 743.8 million (US$109.7 million), representing a 22.1% increase year over year and a 16.7% increase sequentially. The increases were driven by improving performance by a greater number of mature hotels with higher RevPAR, while the sequential increase was also particularly due to a seasonally higher occupancy rate.
Total revenues from franchised-and-managed hotels for the second quarter of 2010 were RMB 63.1 million (US$9.3 million), representing a 91.8% increase year over year and a 37.8% increase sequentially. Revenues from
franchised-and-managed hotels for the quarter increased as a result of the larger number of such hotels in operation, as well as higher RevPAR. Home Inns opened a net of 36 new franchised-and-managed hotels during the second quarter of 2010.
Total operating costs and expenses for the second quarter of 2010 were RMB 584.1 million (US$86.1 million). Total operating costs and expenses excluding share-based compensation expenses (non-GAAP) for the quarter increased 7.9% from the same quarter last year to RMB 570.1 million (US$84.1 million), representing 70.7% of total revenues.
Total leased-and-operated hotel costs for the second quarter of 2010 were RMB 517.7 million (US$76.3 million), representing 69.6% of the
leased-and-operated hotel revenues. This compared to 79.8% for the same quarter in 2009 and 81.9% for the previous quarter. The decrease year over year in leased-and-operated hotel costs as a percentage of leased-and-operated hotel revenue was primarily due to an increased revenue base and lower
pre-opening expenses from fewer hotels under construction in the quarter. The sequential decrease in percentage was mainly due to the larger revenue base and seasonally lower utility costs.
Sales and marketing expenses for the second quarter of 2010 were RMB 8.6 million (US$1.3 million), or 1.1% of total revenues, an increase of 63.5% year over year and an increase of 14.7% sequentially. The year-over-year increase resulted mainly from marketing costs related to the Shanghai World Expo and our corporate initiatives to focus more resources on member loyalty programs. During the economic down-turn in 2009, marketing activities were kept at minimum levels.
General and administrative expenses for the second quarter of 2010 were RMB 57.9 million (US$8.5 million). General and administrative expenses excluding share-based compensation expenses (non-GAAP) were RMB 43.8 million (US$6.5 million), or 5.4% of the total revenues, compared with 5.8% of the total revenues in the same period of 2009 and 6.0% in the previous quarter.
The above resulted in income from operations for the quarter of RMB 173.9 million (US$25.6 million). Income from operations excluding share-based compensation expenses (non-GAAP) was RMB 188.0 million (US$27.7 million), compared to an income from operations of RMB 74.1 million (US$10.9 million) in the same period of 2009 and an income from operations of RMB 71.0 million (US$10.4 million) in the previous quarter. The main reasons for the increase in income from operations year over year were higher revenues and better leased-and-operated hotel expense ratios, while the main reason for the sequential increase in income from operations was higher RevPAR in the quarter.
EBITDA (non-GAAP) for the second quarter of 2010 was RMB 261.6 million (US$38.6 million). Excluding gain on buy-back of convertible bonds, foreign exchange loss and share-based compensation expenses, adjusted EBITDA (non-GAAP) was RMB 274.2 million (US$40.4 million), or 34% of total revenues, representing an increase of 84% from the same period a year ago and a margin rate improvement of 10.8 percentage points year over year.
Net income attributable to Home Inns' shareholders for the quarter was RMB 135.8 million (US$20.0 million). Adjusted net income attributable to Home Inns' shareholders (non-GAAP), which excludes gain on buy-back of convertible bonds, share-based compensation expenses and foreign exchange loss, was RMB 148.4 million (US$21.9 million) for the second quarter of 2010, compared with a net income of RMB 60.6 million (US$8.9 million) from the same period a year ago.
For the second quarter of 2010, basic earnings per share were RMB 1.69 (US$0.25), while diluted earnings per share were RMB 1.59 (US$0.23). Basic earnings per ADS were RMB 3.37 (US$0.50), while diluted earnings per ADS were RMB 3.18 (US$0.47). Excluding share-based compensation expenses, gain on
buy-back of convertible bonds and foreign exchange loss, adjusted basic earnings per share (non-GAAP) were RMB 1.84 (US$0.27), while adjusted diluted earnings per share (non-GAAP) were RMB 1.76 (US$0.26). Adjusted basic earnings per ADS (non-GAAP) were RMB 3.69 (US$0.54), and adjusted diluted earnings per ADS (non-GAAP) were RMB 3.52 (US$0.52).
Net operating cash flow for the second quarter of 2010 was RMB 280.0 million (US$41.3 million) representing a 55.1% increase from the second quarter of 2009. Capitalized expenditures for the quarter were RMB 90.0 million (US$13.3 million), while related cash paid for capital expenditures during the quarter was RMB 36.9 million (US$5.4 million).
At the end of the second quarter of 2010, Home Inns had cash and cash equivalents of RMB 913.4 million (US$134.7 million), and the outstanding balance of its convertible bonds was RMB 159.0 million (US$23.4 million) including principal and accrued interest. During the second quarter of 2010, Home Inns repurchased and retired RMB 165.3 million (US$24.4 million) of its convertible bonds.
Outlook for Third Quarter of 2010
Home Inns expects its total revenues in the third quarter of 2010 to be in the range of RMB 875 million (US$129.0 million) to RMB 895 million (US$132.0 million), representing a 20-23% year-over-year increase. This forecast reflects Home Inns' current and preliminary view, which is subject to change.
Conference Call Information
Home Inns' management will hold an earnings conference call at 9 PM on August 10, 2010 U.S. Eastern Daylight Time (9 AM on August 11, 2010 Beijing/Hong Kong time).
Dial-in details for the earnings conference call are as follows:
China Mainland (toll free): +10-800-130-0399
Hong Kong: +852-3002-1672
U.S. (toll free): +1-866-543-6408
U.S. and International: +1-617-213-8899
Passcode for all regions: Home Inns
A replay of the conference call may be accessed by phone at the following numbers until the end of August 18, 2010 U.S. Eastern Daylight Time.
U.S. toll free: +1-888-286-8010
International: +1-617-801-6888
Passcode: 70694065
Live and archived webcasts of this conference call will be available at http://english.homeinns.com .
About Home Inns
Home Inns is a leading economy hotel chain in China based on the number of hotels and hotel rooms, as well as the geographic coverage of the hotel chain. Since Home Inns commenced operations in 2002, it has become one of the
best-known economy hotel brands in China. Home Inns offers a consistent product and high-quality services to primarily serve the fast growing population of value-conscious individual business and leisure travelers who demand clean, comfortable and convenient lodging. Home Inns' ADSs, each of which represents two ordinary shares, are currently trading on the NASDAQ Global Select Market under the symbol "HMIN." For more information about Home Inns, please visit http://english.homeinns.com .
Safe Harbor
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 "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Any statements in this press release that are not historical facts are
forward-looking statements that involve factors, risks and uncertainties that could cause actual results to differ materially from those in the
forward-looking statements. Such factors and risks include our anticipated growth strategies; our future results of operations and financial condition; the economic conditions of China; the regulatory environment in China; our ability to attract customers and leverage our brand; trends and competition in the lodging industry; the expected growth of the lodging market in China; and other factors and risks detailed in our filings with the Securities and Exchange Commission. This press release also contains statements or projections that are based upon information available to the public, as well as other information from sources which management believes to be reliable, but it is not guaranteed by us to be accurate, nor do we purport it to be complete. We undertake no obligation to update or revise to the public any forward-looking statements, whether as a result of new information, future events or otherwise, unless required by applicable law.
Non-GAAP Financial Measures
To supplement Home Inns' unaudited consolidated financial results presented in accordance with U.S. GAAP, Home Inns uses the following non-GAAP measures defined as non-GAAP financial measures by the SEC: total operating costs and expenses excluding share-based compensation expenses, general and administrative expenses excluding share-based compensation expenses, income from operations excluding share-based expenses, adjusted net income attributable to shareholders excluding foreign exchange gain or loss,
share-based compensation and gain on buy-back of convertible bonds, adjusted basic and diluted earnings per ADS and per share excluding foreign exchange gain or loss, share-based compensation and gain on buy-back of convertible bonds, EBITDA and adjusted EBITDA excluding foreign exchange gain or loss, share-based compensation and gain on buy-back of convertible bonds. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with U.S. GAAP. For more information on these non-GAAP financial measures, please see the table captioned "Reconciliations of GAAP and non-GAAP results" set forth at the end of this press release.
Home Inns believes that in conjunction with GAAP financial measures, these non-GAAP financial measures provide meaningful supplemental information regarding its performance and liquidity and both management and investors benefit from referring to these non-GAAP financial measures in assessing its performance and when planning and forecasting future periods. Management believes that EBITDA, defined as earnings before interest, income tax expense, depreciation and amortization, is a useful financial metric to assess Home Inns' operating and financial performance before the impact of investing and financing transactions and income taxes. In addition, management believes that EBITDA is widely used by other companies in the lodging industry and may be used as an analysis tool by both management and investors to measure and compare Home Inns' operational and financial performance with industry peers.
One of the limitations of using non-GAAP adjusted gross profit, adjusted EBITDA and adjusted net income is that they do not include all items that impact Home Inns' net income for the period. These non-GAAP measures exclude share-based compensation expenses, which have been and will continue to be a significant recurring expense in its business. In addition, its EBITDA and adjusted EBITDA may not be comparable to EBITDA or similarly titled measures utilized by other companies since such other companies may not calculate EBITDA in the same manner as Home Inns does. Management compensates for this and other limitations by providing specific information regarding the GAAP amounts excluded from each non-GAAP measure. Home Inns computes the non-GAAP financial measures using the same consistent method from quarter to quarter. Reconciliations of GAAP and non-GAAP results are included at the end of this press release.
The presentation of EBITDA and adjusted EBITDA should not be construed as an indication that Home Inns' future results will be unaffected by other charges and gains Home Inns considers to be outside the ordinary course of its business.
For investor and media inquiries, please contact:
Ethan Ruan
Home Inns & Hotels Management Inc.
Tel: +86-21-3401-9898 x2004
Email: zjruan@homeinns.com
Tom Evrard
FD Beijing
Tel: +86-10-8591-1951
Email: tom.evrard@fd.com
Home Inns & Hotels Management Inc.
Unaudited Condensed Consolidated Balance Sheet
December 31, 2009 June 30, 2010
RMB '000 RMB '000 US$ '000
ASSETS
Current assets:
Cash and cash equivalents 829,592 913,433 134,695
Accounts receivable 32,069 46,177 6,809
Receivables from related parties 3,136 8,343 1,230
Consumables 15,319 13,610 2,007
Prepayments and other current assets 53,054 65,643 9,680
Deferred tax assets, current 38,918 37,987 5,602
Total current assets 972,088 1,085,193 160,023
Property and equipment, net 1,905,307 1,873,355 276,245
Goodwill 390,882 390,882 57,639
Intangible assets, net 43,184 41,475 6,116
Other assets 33,861 40,260 5,937
Deferred tax assets, non-current 109,626 110,312 16,267
Total assets 3,454,948 3,541,477 522,227
LIABILITIES
Current liabilities:
Accounts payable 21,654 21,705 3,201
Payables to related parties 3,815 3,951 583
Short-term borrowings -- 24,900 3,672
Convertible bond, current 363,506 159,007 23,447
Salaries and welfare payable 103,667 93,921 13,850
Income tax payable 61,764 64,879 9,567
Other taxes payable 15,361 16,968 2,502
Deferred revenues 57,232 65,177 9,611
Accruals for customer reward program 13,331 15,812 2,332
Other unpaid and accruals 67,502 54,128 7,982
Other payables 217,798 249,748 36,826
Total current liabilities 925,630 770,196 113,573
Deferred rental 155,612 163,162 24,060
Deferred revenues, non-current 45,240 49,385 7,282
Deposits 20,735 25,706 3,791
Unfavorable lease liability 14,585 13,898 2,049
Deferred tax liability, non-current 11,577 11,093 1,636
Total liabilities 1,173,379 1,033,440 152,391
Commitments and contingencies
Shareholders' equity
Ordinary shares (US$0.005 par value;
200,000,000 shares authorized,
80,303,510 and 80,772,824 shares
issued and outstanding as of
December 31, 2009 and June 30, 2010,
respectively) 3,209 3,225 476
Additional paid-in capital 1,798,086 1,839,285 271,221
Statutory reserves 67,591 67,591 9,967
Retained earnings 399,218 581,112 85,691
Total Home Inns shareholders' equity 2,268,104 2,491,213 367,355
Noncontrolling interests 13,465 16,824 2,481
Total shareholders' equity 2,281,569 2,508,037 369,836
Total liabilities and shareholders'
equity 3,454,948 3,541,477 522,227
Note 1: The conversion of Renminbi (RMB) into United States dollars (US$)
is based on rate of US$1.00=RMB6.7815 on June 30, 2010,
representing the certificated exchange rate published by the
Federal Reserve Board.
Home Inns & Hotels Management Inc.
Unaudited Condensed Consolidated Statement of Operations
Quarter Ended
June 30, March 31, June 30,
2009 2010 2010
RMB '000 RMB '000 RMB '000 US$ '000
Revenues:
Leased-and-operated hotels 609,136 637,073 743,754 109,674
Franchised-and-managed hotels 32,930 45,825 63,145 9,311
Total revenues 642,066 682,898 806,899 118,985
Less: Business tax and related
surcharges (39,507) (41,942) (48,842) (7,202)
Net revenues 602,559 640,956 758,057 111,783
Operating costs and expenses:
Leased-and-operated hotel costs -
Rents and utilities (186,668) (223,723) (197,839) (29,173)
Personnel costs (114,950) (116,702) (128,961) (19,017)
Depreciation and amortization (69,833) (79,982) (75,487) (11,131)
Consumables, food and beverage (42,811) (36,791) (38,920) (5,739)
Others (71,871) (64,579) (76,481) (11,278)
Total leased-and-operated hotel
costs (486,133) (521,777) (517,688) (76,338)
Sales and marketing expenses (5,243) (7,474) (8,574) (1,264)
General and administrative
expenses* (43,474) (50,058) (57,861) (8,532)
Total operating costs and expenses (534,850) (579,309) (584,123) (86,134)
Income from operations 67,709 61,647 173,934 25,649
Interest income 1,002 1,615 1,780 262
Interest expense (3,142) (435) (293) (43)
Gain on buy-back of convertible bond 46,540 500 1,980 292
Other non-operating income 4,672 2,352 10,004 1,475
Foreign exchange loss, net (262) (319) (504) (74)
Income before income tax expense
and noncontrolling interests 116,519 65,360 186,901 27,561
Income tax expense (15,144) (17,796) (49,213) (7,257)
Net income 101,375 47,564 137,688 20,304
Less: Net income attributable to
noncontrolling interests (943) (1,512) (1,847) (272)
Net income attributable to Home
Inns' shareholders 100,432 46,052 135,841 20,032
Earnings per share
- Basic 1.37 0.57 1.69 0.25
- Diluted 0.70 0.54 1.59 0.23
Weighted average ordinary shares
outstanding
- Basic 73,347 80,330 80,517 80,517
- Diluted 77,983 84,873 84,364 84,364
* Share-based compensation expense
was included in the statement of
operations as follows:
General and administrative expenses 6,430 9,361 14,035 2,070
Note 1: The conversion of Renminbi (RMB) into United States dollars (US$)
is based on rate of US$1.00=RMB6.7815 on June 30, 2010,
representing the certificated exchange rate published by the
Federal Reserve Board.
Home Inns & Hotels Management Inc.
Reconciliation of GAAP and Non-GAAP Results
Quarter Ended June 30, 2010
Share-
%of based %of %of
GAAP Total Compen- Total Non-GAAP Total
Result Revenue sation Revenue Result Revenue
RMB '000 RMB '000 RMB '000
(unaudited) (unaudited) (unaudited)
Leased-and-
operated hotel
costs (517,688) 64.2% -- 0.0% (517,688) 64.2%
Sales and marketing
expenses (8,574) 1.1% -- 0.0% (8,574) 1.1%
General and
administrative
expenses (57,861) 7.2% 14,035 1.7% (43,826) 5.4%
Total operating
costs and
expenses (584,123) 72.4% 14,035 1.7% (570,088) 70.7%
Income from
operations 173,934 21.6% 14,035 1.7% 187,969 23.3%
Quarter Ended June 30, 2010
Share-
%of based %of %of
GAAP Total Compen- Total Non-GAAP Total
Result Revenue sation Revenue Result Revenue
US$ '000 US$ '000 US$ '000
(unaudited) (unaudited) (unaudited)
Leased-and-
operated hotel
costs (76,338) 64.2% -- 0.0% (76,338) 64.2%
Sales and marketing
expenses (1,264) 1.1% -- 0.0% (1,264) 1.1%
General and
administrative
expenses (8,532) 7.2% 2,070 1.7% (6,462) 5.4%
Total operating
costs and
expenses (86,134) 72.4% 2,070 1.7% (84,064) 70.7%
Income from
operations 25,649 21.6% 2,070 1.7% 27,719 23.3%
Quarter Ended March 31, 2010
Share-
%of based %of %of
GAAP Total Compen- Total Non-GAAP Total
Result Revenue sation Revenue Result Revenue
RMB '000 RMB '000 RMB '000
(unaudited) (unaudited) (unaudited)
Leased-and-
operated hotel
costs (521,777) 76.4% -- 0.0% (521,777) 76.4%
Sales and marketing
expenses (7,474) 1.1% -- 0.0% (7,474) 1.1%
General and
administrative
expenses (50,058) 7.3% 9,361 1.4% (40,697) 6.0%
Total operating
costs and
expenses (579,309) 84.8% 9,361 1.4% (569,948) 83.5%
Income from
operations 61,647 9.0% 9,361 1.4% 71,008 10.4%
Quarter Ended June 30, 2009
Share-
%of based %of %of
GAAP Total Compen- Total Non-GAAP Net
Result Revenue sation Revenue Result Revenue
RMB '000 RMB '000 RMB '000
(unaudited) (unaudited) (unaudited)
Leased-and-
operated hotel
costs (486,133) 75.7% -- 0.0% (486,133) 75.7%
Sales and marketing
expenses (5,243) 0.8% -- 0.0% (5,243) 0.8%
General and
administrative
expenses (43,474) 6.8% 6,430 1.0% (37,044) 5.8%
Total operating
costs and
expenses (534,850) 83.3% 6,430 1.0% (528,420) 82.3%
Income from
operations 67,709 10.6% 6,430 1.0% 74,139 11.6%
Note 1: The conversion of Renminbi (RMB) into United States dollars (US$)
is based on rate of US$1.00=RMB6.7815 on June 30, 2010,
representing the certificated exchange rate published by the
Federal Reserve Board.
Home Inns & Hotels Management Inc.
Reconciliation of GAAP and Non-GAAP Results (continued)
Quarter Ended
June 30, March 31, June 30,
2009 2010 2010
RMB '000 RMB '000 RMB '000 US$ '000
(unaudited)(unaudited)(unaudited)(unaudited)
Net income attributable to
Home Inns' shareholders
(GAAP) 100,432 46,052 135,841 20,032
Foreign exchange loss, net 262 319 504 74
Share-based compensation 6,430 9,361 14,035 2,070
Gain on buy-back of
convertible bond (46,540) (500) (1,980) (292)
Adjusted net income attributable
to Home Inns' shareholders
(Non-GAAP)
(Net income attributable to
Home Inns' shareholders
excluding foreign exchange
loss, share-based compensation
and gain on buy-back of
convertible bond) 60,584 55,232 148,400 21,884
Quarter Ended
June 30, March 31, June 30,
2009 2010 2010
RMB '000 RMB '000 RMB '000 US$ '000
(unaudited)(unaudited)(unaudited)(unaudited)
Earnings per share (GAAP)
- Basic 1.37 0.57 1.69 0.25
- Diluted 0.70 0.54 1.59 0.23
Weighted average ordinary shares
outstanding
- Basic 73,347 80,330 80,517 80,517
- Diluted 77,983 84,873 84,364 84,364
Adjusted earnings per share
(Non-GAAP)
(Earnings per share excluding
foreign exchange loss, share-
based compensation and gain on
buy-back of convertible bond)
- Basic 0.83 0.69 1.84 0.27
- Diluted 0.78 0.65 1.76 0.26
Weighted average ordinary
shares outstanding
- Basic 73,347 80,330 80,517 80,517
- Diluted 77,983 84,873 84,364 84,364
Note 1: The conversion of Renminbi (RMB) into United States dollars (US$)
is based on rate of US$1.00=RMB6.7815 on June 30, 2010,
representing the certificated exchange rate published by the
Federal Reserve Board.
Home Inns & Hotels Management Inc.
Reconciliation of GAAP and Non-GAAP Results (continued)
Quarter Ended
June 30, March 31, June 30,
2009 2010 2010
RMB '000 RMB '000 RMB '000 US$ '000
(unaudited)(unaudited)(unaudited)(unaudited)
Net income attributable to
Home Inns' shareholders 100,432 46,052 135,841 20,032
Interest income (1,002) (1,615) (1,780) (262)
Interest expenses 3,142 435 293 43
Income tax expense 15,144 17,796 49,213 7,257
Depreciation and
amortization 71,177 83,008 78,076 11,513
EBITDA (Non-GAAP) 188,893 145,676 261,643 38,583
Foreign exchange loss, net 262 319 504 74
Share-based compensation 6,430 9,361 14,035 2,070
Gain on buy-back of
convertible bond (46,540) (500) (1,980) (292)
Adjusted EBITDA (Non-GAAP)
(EBITDA excluding foreign
exchange loss, share-based
compensation and gain on
buy-back of convertible bond) 149,045 154,856 274,202 40,435
%of total revenue 23.2% 22.7% 34.0% 34.0%
Home Inns & Hotels Management Inc.
Operating Data
As of and for the quarter ended
June 30, March 31, June 30,
2009 2010 2010
Total Hotels in operation: 547 638 674
Leased-and-operated hotels 369 390 390
Franchised-and-managed hotels 178 248 284
Total rooms 63,968 74,256 78,231
Occupancy rate (as a percentage) 92.4% 90.5% 96.4%
Average daily rate (in RMB) 160 159 177
RevPAR (in RMB) 148 144 171
Like-for-like performance for hotels opened for at least 18 months during
the current quarter
As of and for the quarter ended
June 30, 2009 June 30, 2010
Total Hotels in operation: 466 466
Leased-and-operated hotels 326 326
Franchised-and-managed hotels 140 140
Total rooms 55,594 55,594
Occupancy rate (as a percentage) 95% 98%
Average daily rate (in RMB) 162 180
RevPAR (in RMB) 152 176
* "Occupancy rate" refers to the total number of occupied rooms
divided by the total number of available rooms in a given period.
"Average daily rate" refers to total hotel room revenues divided by the
total number of occupied rooms in a given period.
"RevPAR" represents revenue per available room, which is calculated by
dividing total hotel room revenues by the total number of available
rooms in a given period, or by multiplying average daily rates and
occupancy rates in a given period.
Source: Home Inns & Hotels Management Inc.
