IFM Investments Limited Reports Fourth Quarter and Fiscal Year 2009 Unaudited Results
Quarterly Net Revenue Increased by 222.5% Year-over-Year
Fiscal Year Net Revenue Increased by 138.4% Year-over-Year
BEIJING, March 15 /PRNewswire-Asia-FirstCall/ -- IFM Investments Limited (NYSE: CTC) ("Century 21 China Real Estate" or the "Company"), a leading comprehensive real estate services provider and the exclusive franchisor for the CENTURY 21(R) brand in China, today announced its unaudited financial results for the fourth quarter and fiscal year ended December 31, 2009.
Fourth Quarter and Fiscal Year 2009 Highlights(1)
-- Net revenue for the fourth quarter of 2009 was RMB208.0 million
(US$30.5 million), a 222.5% increase from the same quarter of 2008.
-- Net revenue for fiscal year ended December 31, 2009 was RMB651.7
million (US$95.5 million), a 138.4% increase from fiscal year 2008.
-- Income from operations for the fourth quarter of 2009 was RMB51.2
million (US$7.5 million), compared to a loss from operations of RMB32.9
million for the same quarter of 2008.
-- Income from operations for fiscal year 2009 was RMB141.5 million
(US$20.7 million), compared to a loss from operations of RMB127.6
million for fiscal year 2008.
-- Net income attributable to IFM Investments Limited for the fourth
quarter of 2009 was RMB46.7 million (US$6.8 million), compared to a
loss of RMB32.6 million for the same quarter of 2008.
-- Net income attributable to IFM Investments Limited for fiscal year 2009
was RMB135.0 million (US$19.8 million), compared to a loss of RMB132.3
million for fiscal year 2008.
"We're very pleased with our strong fourth quarter and full year results for 2009," said Mr. Donald Zhang, chairman and chief executive officer of Century 21 China Real Estate. "With our primary focus on the secondary real estate market in China, we further expanded our nationwide network of regional sub-franchisors during the fourth quarter of 2009 by entering into Taiyuan city, re-signing a regional sub-franchisor in Jinan city, and opening up new company-owned brokerage sales offices. Our recent IPO on the NYSE is a testament of investors' confidence in our leading market position and the long-term prospects of the secondary real estate market in China."
Mr. Harry Lu, vice chairman and president, continued, "Our improved operational efficiency along with the robust growth in transaction volume during fiscal year 2009 demonstrates our ability to execute our expansion strategy. In the fourth quarter of 2009, we established new business units to develop our primary residential and commercial properties markets. Going forward, we will continue to expand our training and recruitment system to support our growth strategy."
Other Recent Developments
As of December 31, 2009, our CENTURY 21(R) China network covered 35 major cities with more than 1,100 sales offices, including 318 company-owned sales offices with 20 offices under renovation, employed more than 15,900 sales professionals and staff and maintained more than 5.3 million property listings.
On January 28, 2010, IFM Investments Limited's initial public offering ("IPO") of its 12,487,500 American Depositary Shares ("ADSs"), priced at US$7.00 per ADS, and its ADSs began trading on the New York Stock Exchange under the symbol "CTC." Each ADS represents 15 Class A ordinary shares of the Company. Upon the completion of the IPO, all convertible and redeemable preferred shares were converted to Class A and Class B ordinary shares, with a total of 686,154,777 ordinary shares or 45,743,652 ADSs outstanding. Net proceeds to the Company were approximately US$79 million, after deducting the estimated underwriting discount and offering expenses payable by the Company.
Fourth Quarter 2009 Results
The Company's total net revenue for the fourth quarter of 2009 was RMB208.0 million (US$30.5 million), representing a 222.5% increase from RMB64.5 million for the same quarter of 2008.
Revenue from company-owned brokerage services for the fourth quarter of 2009 was RMB182.3 million (US$26.7 million), representing 87.7% of total net revenue, a 248.1% increase of from RMB52.4 million for the same quarter of 2008.
Revenue from mortgage management services for the fourth quarter of 2009 was RMB10.5 million (US$1.5 million), representing 5.0% of total net revenue, a 280.7% increase from RMB2.7 million for the same quarter of 2008.
Revenue from franchise services for the fourth quarter of 2009 was RMB14.9 million (US$2.2 million), representing 7.2% of total net revenue, a 59.5% increase from RMB9.4 million for the same quarter of 2008.
Commission and other agent-related costs for the fourth quarter of 2009 were RMB91.2 million, (US$13.4 million), representing 43.8% of total net revenue, a 158.3% increase from RMB35.3 million for the same quarter of 2008.
Operating costs for the fourth quarter of 2009 were RMB34.4 million (US$5.0 million), representing 16.6% of total net revenue, a slight decrease of 3.2% from RMB35.6 million for the same quarter of 2008.
Selling, general and administrative expenses for the fourth quarter of 2009 were RMB31.1 million (US$4.6 million), representing 15.0% of total net revenue, a 17.5% increase from RMB26.5 million for the same quarter of 2008.
Income from operations for the fourth quarter of 2009 was RMB51.2 million (US$7.5 million), representing 24.6% of total net revenue, compared to a loss of RMB32.9 million for the same quarter of 2008.
Net income attributable to IFM Investments Limited for the fourth quarter of 2009 was RMB46.7 million (US$6.8 million), representing 22.5% of total net revenue, compared to a loss of RMB32.6 million for the same quarter of 2008. Net income attributable to ordinary shareholders for the fourth quarter of 2009 was RMB19.4 million (US$2.8 million), compared to a loss of RMB36.6 million for the same quarter of 2008. Basic and diluted net income per ADS for the fourth quarter of 2009 was RMB1.12 (US$0.16) and RMB1.02 (US$0.15), respectively(2).
As of December 31, 2009, the Company had cash and cash equivalents of RMB334.6 million (US$49.0 million). Net operating cash inflow and capital expenditure for the fourth quarter of 2009 were RMB74.3 million (US$10.9 million) and RMB5.2 million (US$0.76 million), respectively.
Fiscal Year 2009 Results
The Company's net revenue for fiscal year 2009 was RMB651.7 million (US$95.5 million), representing a 138.4% increase from RMB273.4 million for fiscal year 2008, mainly driven by the robust growth in our company-owned brokerage services and mortgage management services.
Revenue from company-owned brokerage services for fiscal year 2009 was RMB590.2 million (US$86.5 million), representing 90.6% of total net revenue, a 186.4% increase from RMB206.1 million for fiscal year 2008.
Revenue from mortgage management services for fiscal year 2009 was RMB32.9 million (US$4.8 million), representing 5.1% of total net revenue, a 209.2% increase from RMB10.7 million for fiscal year 2008.
Revenue from franchise services for fiscal year 2009 was RMB28.2 million (US$4.1 million), representing 4.3% of total net revenue, a 50.2% decrease from fiscal year 2008.
Commissions and other agent-related costs for fiscal year 2009 were RMB289.1 million (US$42.4 million), representing 44.4% of total net revenue, a 90.8% increase from RMB151.6 million for fiscal year 2008.
Operating costs for fiscal year 2009 were RMB119.6 million (US$17.5 million), representing 18.4% of total net revenue, a decrease of 18.3% from RMB146.5 million for fiscal year 2008.
Selling, general and administrative expenses for fiscal year 2009 were RMB101.4 million (US$14.9 million), representing 15.6% of total net revenue, a decrease of 1.5% from RMB103.0 million for fiscal year 2008.
Income from operations for fiscal year 2009 was RMB141.5 million (US$20.7 million), representing 21.7% of total net revenue, compared to a loss of RMB127.6 million for fiscal year 2008.
Net income attributable to IFM Investments Limited for fiscal year 2009 was RMB135.0 million (US$19.8 million), representing 20.7% of total net revenue, compared to a loss of RMB132.3 million for fiscal year 2008. Net income attributable to ordinary shareholders for fiscal year 2009 was RMB54.0 million (US$7.9 million), compared to a loss of RMB148.1 million for fiscal year 2008. Basic and diluted net income per ADS for fiscal year 2009 was RMB3.11 (US$0.46) and RMB2.92 (US$0.43), respectively(2).
Net operating cash inflow and capital expenditure for fiscal year 2009 were RMB171.8 million (US$25.2 million) and RMB14.1 million (US$2.1 million), respectively.
Business Outlook
The Company currently estimates that its total net revenue for the first quarter of 2010 will be in the range of RMB94 million to RMB100 million, based on seasonally slow January and February 2010 transaction volumes and forecasted March 2010 activities. This forecast reflects the Company's current and preliminary view, which is subject to change.
Conference Call Information
Century 21 China Real Estate's management will host an earnings conference call on March 15, 2010 at 8 a.m. U.S. Eastern Time (8 p.m. Beijing/Hong Kong time).
Dial-in details for the earnings conference call are as follows:
U.S./International: +1-857-350-1589
Hong Kong: +852-3002-1672
Mainland China: 10-800-130-0399
Please dial in 10 minutes before the call is scheduled to begin and provide the passcode to join the call. The passcode is "Century 21 China Real Estate earnings call."
A live and archived webcast of the conference call will be available until March 22, 2010 at http://ir.century21cn.com .
About IFM Investments Limited
IFM Investments Limited ("Century 21 China Real Estate") (NYSE: CTC) is a leading comprehensive real estate services provider and the exclusive franchisor for the CENTURY 21(R) brand in China. Century 21 China Real Estate primarily focuses on China's fast-growing and highly fragmented secondary real estate market, providing company-owned brokerage services, franchise services and mortgage management services. Century 21 China Real Estate has experienced substantial growth since it commenced operations in 2000, supported by its information systems and training programs. Over the past ten years, it has received numerous awards and recognition for its service quality and business achievements, including "Highly Appraised Franchisor Award" by the China Chain Store and Franchise Association in 2008 and 2009, "Prominent Real Estate Services Provider" by Sina.com in 2008 and "Most Reputable Real Estate Services Provider" by Sohu.com in 2009. For more information about Century 21 China Real Estate, please visit http://www.century21cn.com/english .
Safe Harbor: Forward-Looking Statements
This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements can be identified by terminology such as "aim," "anticipate," "believe," "confident," "continue," "estimate," "expect," "future," "intend," "is currently reviewing," "it is possible," "likely," "may," "plan," "potential," "will" or other similar expressions or the negative of these words or expressions. The Company has based these forward-looking statements largely on its current expectations and projections about future events and financial trends that it believes may affect its financial condition, results of operations, business strategy and financial needs. Among other things, the Business Outlook section and quotations from management in this press release, as well as the Company's strategic and operational plans, contain forward-looking statements. The Company may also make written or oral forward-looking statements in its reports filed or furnished with the U.S. Securities and Exchange Commission, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about the Company's beliefs and expectations, are forward-looking statements and are subject to change, and such change may be material and may have a material adverse effect on the Company's financial condition and results of operations for one or more periods. Forward-looking statements involve inherent risks and uncertainties. A number of important factors could cause actual results to differ materially from those contained, either expressly or impliedly, in any of the forward- looking statements in this press release. Potential risks and uncertainties include, but are not limited to, a severe or prolonged downturn in the global economy, the Company's susceptibility to fluctuations in the real estate market of China, government measures aimed at China's real estate industry, failure of the real estate services industry in China to develop or mature as quickly as expected, diminution of the value of the Company's brand or image, the Company's inability to successfully execute its strategy of expanding into new geographical markets in China, the Company's failure to manage its growth effectively and efficiently, the Company's failure to successfully execute the business plans for its strategic alliances and other new business initiatives, the Company's loss of its competitive advantage if it fails to maintain and improve its information system or to prevent disruptions or failure in the system's performance, the Company's failure to compete successfully, fluctuations in the Company's results of operations and cash flows, natural disasters or outbreaks of health epidemics such as the H1N1 flu and other risks outlined in the Company's filings with the U.S. Securities and Exchange Commission. Unless otherwise specified, all information provided in this press release and in the attachments is as of the date of this press release, and the Company does not undertake any obligation to update any such information, except as required under applicable law.
(1) This announcement contains translations of certain Renminbi ("RMB")
amounts into U.S. dollar ("USD") amounts at specified rates solely for
the convenience of the readers. Unless otherwise noted, all
translations from RMB amounts into USD as of and for the quarter/year
ended December 31, 2009, were made at noon buying rate of RMB6.8259 to
USD1.00 on December 31, 2009 in New York for cable transfers in RMB as
certified in the H.10 weekly statistical release of the Federal
Reserve Board. Our functional and reporting currency is RMB.
(2) Basic and diluted net income (loss) per ADS for the fourth quarter and
fiscal year 2008 and 2009 was calculated based on net income (loss)
attributable to ordinary shareholders and corresponding basic and
diluted number of ADSs, assuming that during each period presented,
each ADS represents 15 Class A ordinary shares of the Company. Refer
to "Unaudited Condensed Consolidated Statements of Operations" for
details.
For investor and media inquiries, please contact:
In China:
Kevin Yung
Executive Vice President
IFM Investments Limited
Phone: +86-10-6561-0345
Email: [email protected]
Melody Liu
Investor Relations Manager
IFM Investments Limited
Phone: +86-10-6561-5982
Email: [email protected]
Michael Tieu
ICR Inc.
Phone: +86-10-6599-7960
Email: [email protected]
In the United States:
William Zima
ICR, Inc.
Phone: +1-203-682-8200
Email: [email protected]
IFM Investments Limited
Unaudited Condensed Consolidated Balance Sheets
(in thousands, except par value)
As of December 31,
2008 2009 2009
RMB RMB US$
ASSETS
Current assets:
Cash and cash equivalents 176,977 334,589 49,018
Restricted cash 17,213 28,784 4,217
Accounts receivable, net 13,633 61,938 9,074
Amounts due from related
parties 38,110 387 57
Prepaid expenses and other
current assets 19,877 25,641 3,756
Total current assets 265,810 451,339 66,122
Non-current assets:
Investment in associates 1,042 880 129
Property and equipment, net 42,954 41,181 6,033
Intangible assets, net 29,796 27,825 4,076
Goodwill 9,281 9,281 1,360
Other non-current assets 12,012 13,328 1,952
Total assets 360,895 543,834 79,672
LIABILITIES AND
SHAREHOLDER'S DEFICIT
Current liabilities:
Accounts payable 6,904 8,695 1,274
Accrued expenses and other
current liabilities 53,597 130,218 19,077
Amounts due to related parties 34,015 700 103
Deferred revenue 5,396 6,664 976
Deferred tax liabilities 533 -- --
Total current liabilities 100,445 146,277 21,430
Long-term deposits payable 10,573 10,710 1,568
Deferred tax liabilities 338 353 52
Total liabilities 111,356 157,340 23,050
Convertible redeemable preferred
shares (US$0.001 par value,
311,367 shares authorized,
issued and outstanding, with
redemption value of RMB566,
470 as of December 31, 2008
and 2009) 501,892 518,318 75,934
Shareholders' deficit:
Ordinary shares (US$0.001
par value, 1,013,747 shares
authorized as of December 31,
2008 and 2009; 260,000 shares
issued and outstanding as of
December 31, 2008 and 2009) 2,152 2,152 315
Additional paid-in capital 13,508 -- --
Accumulated deficit (268,013) (134,032) (19,636)
Total IFM Investments
Limited shareholders'
deficit (252,353) (131,880) (19,321)
Non-controlling interest -- 56 9
Total shareholder's
deficit (252,353) (131,824) (19,312)
TOTAL LIABILITIES,
CONVERTIBLE REDEEMABLE
PREFERRED SHARES AND
SHAREHOLDERS' DEFICIT 360,895 543,834 79,672
IFM Investments Limited
Unaudited Condensed Consolidated Statements of Operations
(in thousands, except per share data)
For the Three Months Ended
December 31,
2008 2009 2009
RMB RMB US$
Net revenue 64,482 207,965 30,467
Costs and expenses:
Commissions and other agent related
costs (35,300) (91,168) (13,356)
Operating costs (35,568) (34,422) (5,043)
Selling, general and administrative
expenses (26,496) (31,143) (4,562)
Total costs and expenses (97,364) (156,733) (22,961)
(Loss) income from operations (32,882) 51,232 7,506
Interest income 1,733 669 97
Foreign currency exchange loss (1,068) (16) (2)
(Loss) income before income tax and
share of associates' (losses) income (32,217) 51,885 7,601
Income tax (296) (5,454) (799)
Share of associates' (losses) income (76) 31 5
Net (loss) income (32,589) 46,462 6,807
Non-controlling interest -- 246 36
Net (loss) income attributable to
IFM Investments Limited (32,589) 46,708 6,843
Accretion of convertible redeemable
preferred shares (4,024) (4,157) (609)
Income allocated to participating
preferred shareholders -- (23,188) (3,397)
Net (loss) income attributable to
ordinary shareholders (36,613) 19,363 2,837
Net (loss) income per share, basic (0.14) 0.07 0.01
Net (loss) income per share, diluted (0.14) 0.07 0.01
Net (loss) income per ADS, basic (2.11) 1.12 0.16
Net (loss) income per ADS, diluted (2.11) 1.02 0.15
Number of shares used in calculating
net (loss) income per share, basic 260,000 260,000 260,000
Number of shares used in calculating
net (loss) income per share, diluted 260,000 284,668 284,668
Number of ADSs used in calculating
net (loss) income per ADS, basic 17,333 17,333 17,333
Number of ADSs used in calculating
net (loss) income per ADS, diluted 17,333 18,978 18,978
For the Year Ended December 31,
2008 2009 2009
RMB RMB US$
Net revenue 273,359 651,656 95,468
Costs and expenses:
Commissions and other agent related
costs (151,550) (289,146) (42,360)
Operating costs (146,457) (119,605) (17,522)
Selling, general and administrative
expenses (102,952) (101,421) (14,858)
Total costs and expenses (400,959) (510,172) 74,740
(Loss) income from operations (127,600) 141,484 20,728
Interest income 4,441 2,244 329
Foreign currency exchange loss (5,526) (496) (73)
(Loss) income before income tax and
share of associates' (losses) income (128,685) 143,232 20,984
Income tax (2,076) (8,275) (1,212)
Share of associates' (losses) income (1,126) (162) (24)
Net (loss) income (131,887) 134,795 19,748
Non-controlling interest (431) 246 36
Net (loss) income attributable to
IFM Investments Limited (132,318) 135,041 19,784
Accretion of convertible redeemable
preferred shares (15,759) (16,426) (2,406)
Income allocated to participating
preferred shareholders -- (64,639) (9,470)
Net (loss) income attributable to
ordinary shareholders (148,077) 53,976 7,908
Net (loss) income per share, basic (0.57) 0.21 0.03
Net (loss) income per share, diluted (0.57) 0.19 0.03
Net (loss) income per ADS, basic (8.54) 3.11 0.46
Net (loss) income per ADS, diluted (8.54) 2.92 0.43
Number of shares used in calculating net
(loss) income per share, basic 260,000 260,000 260,000
Number of shares used in calculating net
(loss) income per share, diluted 260,000 277,119 277,119
Number of ADSs used in calculating net
(loss) income per ADS, basic 17,333 17,333 17,333
Number of ADSs used in calculating net
(loss) income per ADS, diluted 17,333 18,475 18,475
Unless otherwise noted, all translations from Renminbi ("RMB") amounts into US. Dollar ("USD") amounts as of and for the quarter/year ended December 31, 2009, were made at noon buying rate of RMB6.8259 to USD1.00 on December 31, 2009 in New York for cable transfers in RMB as certified in the H.10 weekly statistical release of the Federal Reserve Board. Our functional and reporting currency is RMB.
SOURCE IFM Investments Limited
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