Ctrip Reports First Quarter 2010 Financial Results
SHANGHAI, May 11 /PRNewswire-Asia/ -- Ctrip.com International, Ltd. (Nasdaq: CTRP), a leading travel service provider for hotel accommodations, airline tickets, packaged tours, and corporate travel management in China, today announced its unaudited financial results for the first quarter ended March 31, 2010.
Highlights for the First Quarter of 2010
-- Net revenues were RMB587 million (US$86 million) for the first quarter
of 2010, up 46% year-on-year. Excluding net revenues attributable to
ezTravel, Ctrip's net revenues were RMB557 million (US$82 million) for
the first quarter of 2010, up 39% year-on-year.
-- Gross margin was 78% for the first quarter of 2010, remaining
consistent with that in the same period in 2009.
-- Income from operations was RMB196 million (US$29 million) for the first
quarter of 2010, up 45% year-on-year. Excluding share-based
compensation charges (non-GAAP), income from operations was RMB261
million (US$38 million), up 61% year-on-year.
-- Operating margin was 33% for the first quarter of 2010, compared to 34%
in the same period in 2009. Excluding share-based compensation charges
(non-GAAP), operating margin was 44%, compared to 40% in the same
period in 2009.
-- Net income attributable to Ctrip's shareholders was RMB190 million
(US$28 million) in the first quarter of 2010, up 57% year-on-year.
Excluding share-based compensation charges (non-GAAP), net income
attributable to Ctrip's shareholders was RMB255 million (US$37 million),
up 72% year-on-year.
-- Diluted earnings per ADS were RMB1.30 (US$0.19) for the first quarter
of 2010. Excluding share-based compensation charges (non-GAAP), diluted
earnings per ADS were RMB1.74 (US$0.26) for the first quarter of 2010.
-- Share-based compensation charges were RMB64 million (US$9 million),
accounting for 11% of the net revenues, or RMB0.44 (US$0.06) per ADS
for the first quarter of 2010.
"We are pleased that our team delivered strong results in the first quarter of 2010, which marked an inspiring beginning for year 2010," said Min Fan, President and Chief Executive Officer of Ctrip. "We will continuously improve customer service quality, strengthen vendor relationship, and adopt innovative technologies. Through our efforts, Ctrip will extend our leadership in the Greater China travel industry."
First Quarter 2010 Financial Results
For the first quarter of 2010, Ctrip reported total revenues of RMB627 million (US$92 million), representing a 46% increase from the same period in 2009 and a 4% increase from the previous quarter.
Hotel reservation revenues amounted to RMB252 million (US$37 million) for the first quarter of 2010, representing a 36% increase year-on-year, and an 8% decrease quarter-on-quarter. Excluding revenues attributable to ezTravel, Ctrip's hotel reservation revenues were RMB246 million (US$36 million), representing a 33% increase year-on-year, primarily driven by the increase in hotel reservation volume. Excluding revenues attributable to ezTravel, Ctrip's hotel reservation revenues decreased by 9% quarter-on-quarter, primarily due to seasonality.
Air ticket booking revenues for the first quarter of 2010 were RMB265 million (US$39 million), representing a 44% increase year-on-year, and a 12% increase quarter-on-quarter. Excluding revenues attributable to ezTravel, Ctrip's air-ticketing revenues were RMB258 million (US$38 million) for the first quarter of 2010, representing a 40% increase year-on-year, primarily driven by a 31% increase in air ticketing sales volume, and a 7% increase in commission per ticket year-on-year. Excluding revenues attributable to ezTravel, Ctrip's air-ticketing revenues increased by 13% quarter-on-quarter, primarily driven by the increase in air ticketing sales volume.
Packaged-tour revenues for the first quarter of 2010 were RMB72 million (US$11 million), representing a 90% increase year-on-year, and a 48% increase quarter-on-quarter. Excluding revenues attributable to ezTravel, Ctrip's packaged-tour revenues were RMB59 million (US$9 million), representing a 55% increase year-on-year, and a 44% increase quarter-on-quarter due to the increase of leisure travel volume.
Corporate travel revenues for the first quarter of 2010 were RMB26 million (US$4 million), representing a 99% increase year-on-year, primarily driven by the increased corporate travel demand from business activities and lower base in the first quarter of 2009, and remained relatively consistent with the previous quarter.
For the first quarter of 2010, net revenues were RMB587 million (US$86 million), representing a 46% increase from the same period in 2009 and a 4% increase from the previous quarter. Excluding net revenues attributable to ezTravel, net revenues were RMB557 million (US$82 million), representing a 39% increase from the same period in 2009, and a 2% increase from the previous quarter.
Gross margin was 78% in the first quarter of 2010, remained consistent with that in the same period in 2009, and compared to 77% in the previous quarter.
Product development expenses for the first quarter of 2010 increased by 59% to RMB101 million (US$15 million) from the same period in 2009 and increased by 14% from the previous quarter, primarily due to an increase of product development personnel and share-based compensation charges. Excluding share-based compensation charges (non-GAAP), product development expenses accounted for 14% of the net revenues, remained consistent with that in the same period in 2009 and increased from 13% in the previous quarter.
Sales and marketing expenses for the first quarter of 2010 increased by 34% to RMB94 million (US$14 million) from the same period in 2009, primarily due to the increase of sales and marketing related activities year-on-year, and decreased by 3% from the previous quarter, primarily due to the decrease of sales and marketing related activities because of seasonality. Excluding share-based compensation charges (non-GAAP), sales and marketing expenses accounted for 15% of the net revenues, decreasing from 17% in the same period in 2009 and 16% in the previous quarter.
General and administrative expenses for the first quarter of 2010 increased by 62% to RMB67 million (US$10 million) from the same period in 2009, and increased by 7% from the previous quarter, primarily due to an increase of administrative personnel and share-based compensation charges. Excluding share-based compensation charges (non-GAAP), general and administrative expenses accounted for 5% of the net revenues, decreasing from 6% in the same period in 2009 and in the previous quarter.
Income from operations for the first quarter of 2010 was RMB196 million (US$29 million), representing an increase of 45% from the same period in 2009 and an increase of 4% from the previous quarter. Excluding share-based compensation charges (non-GAAP), income from operations was RMB261 million (US$38 million), representing an increase of 61% from the same period in 2009 and an increase of 9% from the previous quarter.
Operating margin was 33% in the first quarter of 2010, compared to 34% in the same period in 2009, and remained consistent with that in the previous quarter. Excluding share-based compensation charges (non-GAAP), operating margin was 44%, compared to 40% in the same period in 2009 and 42% in the previous quarter.
Net income attributable to Ctrip's shareholders for the first quarter of 2010 was RMB190 million (US$28 million), representing a 57% increase from the same period in 2009, and remaining consistent with the previous quarter. Excluding share-based compensation charges (non-GAAP), net income attributable to Ctrip's shareholders was RMB255 million (US$37 million), representing an increase of 72% from the same period in 2009, and an increase of 6% from the previous quarter.
The effective tax rate for the first quarter of 2010 was 12%, decreasing from 18% in the same period of 2009 and 20% in the previous quarter, primarily due to certain tax benefit granted by the local tax bureau in the first quarter of 2010.
Diluted earnings per ADS were RMB1.30 (US$0.19) for the first quarter of 2010. Excluding share-based compensation charges (non-GAAP), diluted earnings per ADS were RMB1.74 (US$0.26) for the first quarter of 2010.
As of March 31, 2010, the balance of cash, restricted cash and short-term investment was RMB3.3 billion (US$490 million).
Business Outlook
For the second quarter of 2010, the Company expects to continue the net revenue growth year-on-year at a rate of approximately 30-35%. 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 9:00PM U.S. Eastern Time on May 11, 2010 (or 9:00AM on May 12, 2010 in the Shanghai/HK time zone) 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 +1.888.713.4214, International dial-in number +1.617.213.4866, Passcode 14587692. For pre-registration, please click https://www.theconferencingservice.com/prereg/key.process?key=PH9JVFGQ6 .
A telephone replay of the call will be available after the conclusion of the conference call through May 19, 2010. 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 47897049.
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 on Forms 20-F and 6-K, etc., 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. Statements that are not historical facts, including statements about Ctrip's beliefs and expectations, are forward-looking statements. 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, the slow-down of economic growth in China and the global economic downturn, general declines or disruptions in the travel industry, volatility in the trading price of Ctrip's ADSs, Ctrip's reliance on its relationships 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 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, inflation in China and in other countries, 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 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, "Stock Compensation" for 2010 and 2009. 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 our 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 hotel accommodations, airline tickets, packaged tours, and corporate travel management in China. Ctrip aggregates hotel and flight information to enable business and leisure travelers to make informed and cost-effective bookings. Ctrip also books vacation packages and guided tours. In addition, Ctrip corporate travel management services help 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:
Lin Zhang
Ctrip.com International, Ltd.
Tel: +86-21-3406-4880 x12920
Email: [email protected]
June Zhu
Ctrip.com International, Ltd.
Tel: +86-21-3406-4880 x12258
Email: [email protected]
Ctrip.com International, Ltd.
Consolidated Balance Sheet Information
December March March
31, 2009 31, 2010 31, 2010
RMB RMB USD
(unaudited) (unaudited) (unaudited)
ASSETS
Current assets:
Cash 1,434,618,382 3,093,630,609 453,226,085
Restricted cash 113,150,289 115,341,638 16,897,893
Short-term investment 180,183,917 137,608,859 20,160,107
Accounts receivable, net 420,579,005 501,919,455 73,532,693
Prepayments and other
current assets 134,318,164 137,063,662 20,080,234
Deferred tax assets 23,446,059 31,308,917 4,586,849
Total current assets 2,306,295,816 4,016,873,140 588,483,861
Long-term deposits 143,195,191 145,921,331 21,377,909
Land use rights 108,922,018 108,274,965 15,862,605
Property, equipment and
software 550,506,595 623,460,333 91,338,793
Investment 658,051,285 1,213,145,969 177,729,492
Goodwill 322,936,838 322,936,838 47,311,207
Intangible assets 66,851,954 65,359,778 9,575,402
Total assets 4,156,759,697 6,495,972,354 951,679,269
LIABILITIES
Current liabilities:
Accounts payable 291,045,743 465,865,801 68,250,725
Salary and welfare payable 130,539,660 120,722,117 17,686,149
Taxes payable 142,256,695 102,504,782 15,017,256
Advances from customers 276,792,049 234,044,801 34,288,259
Accrued liability for
customer reward program 88,254,996 95,105,131 13,933,185
Other payables and
accruals 229,652,319 588,212,881 86,174,936
Total current liabilities 1,158,541,462 1,606,455,513 235,350,510
Deferred tax liabilities,
non-current 11,509,937 11,003,872 1,612,100
Total liabilities 1,170,051,399 1,617,459,385 236,962,610
SHAREHOLDERS' EQUITY
Share capital 2,801,334 2,916,471 427,272
Additional paid-in capital 1,219,815,250 2,860,391,679 419,055,888
Statutory reserves 72,489,182 72,489,182 10,619,881
Accumulated other
comprehensive loss (77,742,443) (634,195) (92,912)
Retained Earnings 1,707,684,596 1,898,130,027 278,081,694
Total Ctrip's shareholders'
equity 2,925,047,919 4,833,293,164 708,091,823
Noncontrolling interests 61,660,379 45,219,805 6,624,836
Total shareholders' equity 2,986,708,298 4,878,512,969 714,716,659
Total liabilities and
shareholders' equity 4,156,759,697 6,495,972,354 951,679,269
Ctrip.com International, Ltd.
Consolidated Statement of Operations Information
Quarter Ended Quarter Ended Quarter Ended Quarter Ended
March December March March
31, 2009 31, 2009 31, 2010 31, 2010
RMB RMB RMB USD
(unaudited) (unaudited) (unaudited) (unaudited)
Revenues:
Hotel reservation 185,041,484 274,473,674 251,912,292 36,905,900
Air-ticketing** 184,088,815 236,054,940 264,723,073 38,782,717
Packaged tour 37,717,241 48,458,453 71,781,013 10,516,132
Corporate travel** 13,195,616 26,798,448 26,274,358 3,849,272
Others 8,557,935 17,116,855 12,514,361 1,833,391
Total revenues 428,601,091 602,902,370 627,205,097 91,887,412
Less: business
tax and related
surcharges (28,023,671) (37,188,892) (40,483,224) (5,930,913)
Net revenues 400,577,420 565,713,478 586,721,873 85,956,499
Cost of revenues (89,970,448) (128,218,158) (128,377,508) (18,807,687)
Gross profit 310,606,972 437,495,320 458,344,365 67,148,812
Operating expenses:
Product
development* (63,322,718) (88,084,277) (100,721,820) (14,756,046)
Sales and
marketing* (70,724,071) (97,816,552) (94,439,324) (13,835,642)
General and
administrative* (41,321,278) (62,342,757) (66,741,488) (9,777,826)
Total operating
expenses (175,368,067) (248,243,586) (261,902,632) (38,369,514)
Income from
operations 135,238,905 189,251,734 196,441,733 28,779,298
Interest income 3,363,165 4,687,828 5,337,051 781,894
Other income 9,673,844 30,225,954 581,797 85,235
Income before
income tax
expense and
equity in income 148,275,914 224,165,516 202,360,581 29,646,427
Income tax
expense (26,792,879) (44,662,623) (24,314,306) (3,562,118)
Equity in income
of affiliates -- 14,714,676 11,236,298 1,646,151
Net income 121,483,035 194,217,569 189,282,573 27,730,460
Less: Net
(income) loss
attributable to
noncontrolling
interests (90,755) (4,011,756) 1,162,858 170,362
Net income
attributable to
Ctrip's
shareholders 121,392,280 190,205,813 190,445,431 27,900,822
Earnings per
ordinary share
- Basic 3.62 5.60 5.53 0.81
- Diluted 3.57 5.28 5.21 0.76
Earnings per ADS
- Basic 0.91 1.40 1.38 0.20
- Diluted 0.89 1.32 1.30 0.19
Weighted average
ordinary shares
outstanding
- Basic 33,489,695 33,967,802 34,467,334 34,467,334
- Diluted 33,957,107 36,025,042 36,561,172 36,561,172
* Share-based
compensation
charges included
are as follows:
Product
development 7,242,840 12,319,485 15,993,081 2,343,034
Sales and
marketing 4,025,165 6,896,401 8,843,140 1,295,546
General and
administrative 15,706,497 30,390,027 39,386,817 5,770,286
** Certain prior year amounts have been reclassified with no effect on
net income or retained earnings to conform to the 2010 financial
information presentation. Revenues are presented in accordance with the
definitions below:
Air-ticketing revenues primarily include commissions from air ticket
booking and related services, including sales of aviation casualty
insurance, and revenue generated from air-ticket delivery services.
Corporate travel management revenues primarily include commissions
from hotel reservation, air ticket booking and packaged-tour services
rendered to corporate clients.
Ctrip.com International, Ltd.
Reconciliation of GAAP and Non-GAAP Results
(In RMB, except % and per share information)
Quarter Ended March 31, 2010
GAAP Result % of Share % of Non-GAAP % of
Net -based Net Result Net
Revenue Compensation Revenue Revenue
Product
development (100,721,820) 17% 15,993,081 3% (84,728,739) 14%
Sales and
marketing (94,439,324) 16% 8,843,140 2% (85,596,184) 15%
General and
administrative (66,741,488) 11% 39,386,817 7% (27,354,671) 5%
Total
operating
expenses (261,902,632) 45% 64,223,038 11% (197,679,594) 34%
Income from
operations 196,441,733 33% 64,223,038 11% 260,664,771 44%
Net income
attributable
to Ctrip's
shareholders 190,445,431 32% 64,223,038 11% 254,668,469 43%
Diluted
earnings per
ordinary
share(RMB) 5.21 1.76 6.97
Diluted
earnings
per ADS(RMB) 1.30 0.44 1.74
Diluted
earnings
per ADS(USD) 0.19 0.06 0.26
Quarter Ended December 31, 2009
GAAP Result % of Share % of Non-GAAP % of
Net -based Net Result Net
Revenue Compensation Revenue Revenue
Product
development (88,084,277) 16% 12,319,485 2% (75,764,792) 13%
Sales and
marketing (97,816,552) 17% 6,896,401 1% (90,920,151) 16%
General and
administrative(62,342,757) 11% 30,390,027 5% (31,952,730) 6%
Total
operating
expenses (248,243,586) 44% 49,605,913 9% (198,637,673) 35%
Income from
operations 189,251,734 33% 49,605,913 9% 238,857,647 42%
Net income
attributable
to Ctrip's
shareholders 190,205,813 34% 49,605,913 9% 239,811,726 42%
Diluted
earnings
per ordinary
share(RMB) 5.28 1.38 6.66
Diluted
earnings
per ADS(RMB) 1.32 0.34 1.66
Diluted
earnings
per ADS(USD) 0.19 0.05 0.24
Quarter Ended March 31, 2009
GAAP Result % of Share % of Non-GAAP % of
Net -based Net Result Net
Revenue Compensation Revenue Revenue
Product
development (63,322,718) 16% 7,242,840 2% (56,079,878) 14%
Sales and
marketing (70,724,071) 18% 4,025,165 1% (66,698,906) 17%
General and
administrative(41,321,278) 10% 15,706,497 4% (25,614,781) 6%
Total
operating
expenses (175,368,067) 44% 26,974,502 7% (148,393,565) 37%
Income from
operations 135,238,905 34% 26,974,502 7% 162,213,407 40%
Net income
attributable
to Ctrip's
shareholders 121,392,280 30% 26,974,502 7% 148,366,782 37%
Diluted
earnings per
ordinary
share(RMB) 3.57 0.79 4.37
Diluted
earnings
per ADS(RMB) 0.89 0.20 1.09
Diluted
earnings
per ADS(USD) 0.13 0.03 0.16
Notes for all the 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=RMB6.8258 on March 31,
2010 published by the Federal Reserve Board.
Note 2: Effective on January 21, 2010, Company changed ratio of the
American Depositary Shares ("ADSs") to ordinary shares from two
(2) ADSs representing one (1) ordinary shares to four (4) ADSs
representing one (1) ordinary share. The change is reflected
retroactively in the numbers for all the periods presented above.
SOURCE Ctrip.com International, Ltd.
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