SHANGHAI, November 26, 2014 /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 quarter ended September 30, 2014.

Highlights for the Third Quarter of 2014

  • Net revenues were RMB2.1 billion (US$347 million) for the third quarter of 2014, up 38% year-on-year, exceeding our net revenue guidance for the third quarter 2014 of 30-35% increase year-on-year.
  • Accommodation reservation volume increased 69% year-on-year, exceeding our guidance of 50-60% volume increase year-on year, and accommodation reservation revenues increased 56% year-on-year, reaching RMB950 million (US$155 million) for the third quarter of 2014.
  • Transportation ticketing volume increased 98% year-on-year, exceeding our guidance of 60-70% volume increase year-on year, and transportation ticketing revenues increased 32% year-on-year, reaching RMB800 million (US$130 million) for the third quarter of 2014.
  • Gross margin was 72% for the third quarter of 2014, compared to 75% in the same period in 2013, and remained consistent with that in the previous quarter.
  • Income from operations was RMB88 million (US$14 million) for the third quarter of 2014, down 71% year-on-year. Excluding share-based compensation charges (non-GAAP), income from operations was RMB225 million (US$37 million), down 45% year-on-year.
  • Operating margin was 4% for the third quarter of 2014, compared to 19% in the same period in 2013 and 5% in the previous quarter. Excluding share-based compensation charges (non-GAAP), operating margin was 11%, compared to 27% in the same period in 2013, and 12% in the previous quarter.
  • Net income attributable to Ctrip’s shareholders was RMB217 million (US$35 million) for the third quarter of 2014, down 42% year-on-year. Excluding share-based compensation charges (non-GAAP), net income attributable to Ctrip’s shareholders was RMB354 million (US$58 million), down 27% year-on-year.
  • Diluted earnings per ADS were RMB1.38 (US$0.22) for the third quarter of 2014. Excluding share-based compensation charges (non-GAAP), diluted earnings per ADS were RMB2.24 (US$0.36) for the third quarter of 2014.
  • Share-based compensation charges were RMB137 million (US$22 million), accounting for 6% of the net revenues, or RMB0.86 (US$0.14) per ADS for the third quarter of 2014.

"We are pleased to report the solid performance of Ctrip in the third quarter of 2014," said James Liang, Chairman and Chief Executive Officer of Ctrip. "Accommodation reservation and transportation ticketing services maintained robust growth, reaching 69% and 98% year-over-year in volume respectively. The number of Ctrip mobile app downloads reached 350 million, growing 75% from the previous quarter. We are also encouraged by the progress of our new initiatives. Through the open-platform, we work with around 1,000 hotel agency partners, China’s top 600 air ticketing agencies, and over 800 local travel agencies. Total hotel transactions through the open-platform reached approximately RMB1 billion during the third quarter. We will continue to invest in our open platform strategy and in technology and services to create more value for both our customers and partners."

Third Quarter 2014 Financial Results

For the third quarter of 2014, Ctrip reported total revenues of RMB2.3 billion (US$368 million), representing a 38% increase from the same period in 2013. Total revenues for the third quarter of 2014 increased by 24% from the previous quarter.

Accommodation reservation revenues amounted to RMB950 million (US$155 million) for the third quarter of 2014, representing a 56% increase year-on-year, primarily driven by an increase of 69% in accommodation reservation volume, partially offset by the decrease of commission per room night. Accommodation reservation revenues increased by 26% quarter-on-quarter.

Transportation ticketing revenues for the third quarter of 2014 were RMB800 million (US$130 million), representing a 32% increase year-on-year, driven by an increase of 98% in ticketing volume. Transportation ticketing revenues increased by 10% quarter-on-quarter.

Packaged-tour revenues for the third quarter of 2014 were RMB358 million (US$58 million), representing a 12% increase year-on-year, driven by an increase of 52% in volume of organized tours and self-guided tours. Packaged-tour revenues increased by 74% quarter-on-quarter, primarily due to seasonality.

Corporate travel revenues for the third quarter of 2014 were RMB104 million (US$17 million), representing a 45% increase year-on-year, primarily driven by the increased corporate travel demand from business activities. Corporate travel revenues increased by 15% quarter-on-quarter, primarily due to seasonality.

For the third quarter of 2014, net revenues were RMB2.1 billion (US$347 million), representing a 38% increase from the same period in 2013. Net revenues for the third quarter of 2014 increased by 24% from the previous quarter.

Gross margin was 72% for the third quarter of 2014, compared to 75% in the same period in 2013 and remained consistent with that in the previous quarter.

Product development expenses for the third quarter of 2014 increased by 83% to RMB612 million (US$100 million) from the same period in 2013 and 28% from the previous quarter, primarily due to an increase in product development personnel related expenses. Excluding share-based compensation charges (non-GAAP), product development expenses accounted for 26% of the net revenues, increased from 20% in the same period in 2013 and 25% in the previous quarter.

Sales and marketing expenses for the third quarter of 2014 increased by 69% to RMB598 million (US$97 million) from the same period in 2013 and increased by 25% from the previous quarter, primarily due to an increase in sales and marketing related activities. Excluding share-based compensation charges (non-GAAP), sales and marketing expenses accounted for 27% of the net revenues, increased from 22% in the same period in 2013 and remained consistent with that in the previous quarter.

General and administrative expenses for the third quarter of 2014 increased by 40% to RMB242 million (US$39 million) from the same period in 2013 and 25% from the previous quarter primarily due to an increase in administrative personnel related expenses. Excluding share-based compensation charges (non-GAAP), general and administrative expenses accounted for 8% of the net revenues, increased from 7% in the same period in 2013 and remained consistent with that in the previous quarter.

Income from operations for the third quarter of 2014 was RMB88 million (US$14 million), representing a decrease of 71% from the same period in 2013 and a decrease of 3% from the previous quarter. Excluding share-based compensation charges (non-GAAP), income from operations was RMB225 million (US$37 million), representing a decrease of 45% from the same period in 2013 and an increase of 11% from the previous quarter.

Operating margin was 4% for the third quarter of 2014, compared to 19% in the same period in 2013, and 5% in the previous quarter. Excluding share-based compensation charges (non-GAAP), operating margin was 11%, compared to 27% in the same period in 2013 and 12% in the previous quarter.

The effective tax rate for the third quarter of 2014 was 23%, increased from 22% in the same period of 2013, primarily due to the increase in the amount of non-tax-deductible share-based compensation as a percentage to our income as a whole. The effective tax rate for the third quarter of 2014 decreased from 32% in the previous quarter, primarily due to the decrease in the amount of non-tax-deductible share-based compensation as a percentage to our income as a whole.

Net income attributable to Ctrip’s shareholders for the third quarter of 2014 was RMB217 million (US$35 million), representing a decrease of 42% from the same period in 2013 and an increase of 61% from the previous quarter. Excluding share-based compensation charges (non-GAAP), net income attributable to Ctrip’s shareholders was RMB354 million (US$58 million), representing a decrease of 27% from the same period in 2013 and an increase of 44% from the previous quarter.

Diluted earnings per ADS were RMB1.38 (US$0.22) for the third quarter of 2014. Excluding share-based compensation charges (non-GAAP), diluted earnings per ADS were RMB2.24 (US$0.36) for the third quarter of 2014.

As of September 30, 2014, the balance of cash and cash equivalents, restricted cash and short-term investment was RMB11 billion (US$1.8 billion).

Business Outlook

For the fourth quarter of 2014, the Company expects to continue the net revenue growth year-on-year at a rate of approximately 30%. This forecast reflects Ctrip’s current and preliminary view, which is subject to change.

Recent Development

In November, 2014, Ctrip and Royal Caribbean Cruises Ltd. have agreed to form a strategic partnership through SkySea Cruises, a joint venture which is designed to serve the Chinese cruise market. Royal Caribbean and Ctrip will each own 35% of the new company, with the balance being owned by SkySea management and a private equity fund. The transaction is expected to close before the end of November.

Conference Call

Ctrip’s management team will host a conference call at 7:00PM U.S. Eastern Time on November 25, 2014 (or 8:00AM on November 26, 2014 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 92795298#. For pre-registration, please click https://www.theconferencingservice.com/prereg/key.process?key=P6NJ7YH7K.

A telephone replay of the call will be available after the conclusion of the conference call until December 3, 2014. 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 80825457.

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, 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 2014 and 2013. 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 aggregates comprehensive travel related information and offers 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 enables business and leisure travelers to make informed and cost-effective bookings. It 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 12229
Email: iremail@ctrip.com

Ctrip.com International, Ltd.

Unaudited Condensed Consolidated Balance Sheets

December 31, 2013

September 30, 2014

September 30, 2014

RMB

RMB

USD

(unaudited)

(unaudited)

(unaudited)

ASSETS

Current assets:

Cash and cash equivalents

7,138,344,814

6,969,956,248

1,135,541,911

Restricted cash

739,543,614

821,226,443

133,793,816

Short-term investment

3,635,090,955

3,225,218,438

525,451,033

Accounts receivable, net

1,518,230,029

2,017,679,173

328,719,318

Prepayments and other current assets

1,237,530,956

3,022,529,945

492,429,121

Deferred tax assets, current

96,979,500

137,502,681

22,401,870

Total current assets

14,365,719,868

16,194,112,928

2,638,337,069

Long-term deposits and prepayments

559,185,652

1,623,315,083

264,469,710

Land use rights

107,476,794

105,197,516

17,138,729

Property, equipment and software

1,412,943,693

3,479,457,356

566,871,514

Investment

2,857,213,480

5,067,386,530

825,576,170

Goodwill

972,531,184

1,185,513,074

193,143,218

Intangible assets

356,653,022

425,307,831

69,290,947

Other long-term receviables

186,750,769

187,195,951

30,497,874

Total assets

20,818,474,462

28,267,486,269

4,605,325,231

LIABILITIES

Current liabilities:

Short-term Debt *

774,599,341

2,377,417,044

387,327,638

Accounts payable

1,637,545,824

2,152,769,646

350,728,193

Salary and welfare payable

257,641,763

343,564,283

55,973,327

Taxes payable

315,299,656

366,278,593

59,673,932

Advances from customers

2,451,931,450

3,381,752,999

550,953,568

Accrued liability for customer reward program

284,668,935

410,536,094

66,884,342

Other payables and accruals

646,321,729

1,221,345,494

198,981,019

Total current liabilities

6,368,008,698

10,253,664,153

1,670,522,019

Deferred tax liabilities, non-current

63,197,155

71,791,275

11,696,200

Long-term Debt

5,657,182,650

7,979,400,000

1,300,000,000

Total liabilities

12,088,388,503

18,304,855,428

2,982,218,219

SHAREHOLDERS’ EQUITY

Share capital

3,033,490

3,081,448

502,028

Additional paid-in capital

4,088,484,766

4,680,212,986

762,498,043

Statutory reserves

118,449,230

118,449,230

19,297,691

Accumulated other comprehensive income

372,634,580

541,749,214

88,261,521

Retained Earnings

5,498,934,733

5,966,099,220

971,994,008

Treasury stock

(1,551,141,268)

(1,883,002,778)

(306,777,905)

Total Ctrip’s shareholders’ equity

8,530,395,531

9,426,589,320

1,535,775,386

Noncontrolling interests

199,690,428

536,041,521

87,331,626

Total shareholders’ equity

8,730,085,959

9,962,630,841

1,623,107,012

Total liabilities and shareholders’ equity

20,818,474,462

28,267,486,269

4,605,325,231

* 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

September 30, 2013

June 30, 2014

September 30, 2014

September 30, 2014

RMB

RMB

RMB

USD

(unaudited)

(unaudited)

(unaudited)

(unaudited)

Revenues:

Accommodation reservation **

610,653,418

752,565,453

950,299,334

154,822,309

Transportation ticketing ***

604,272,344

725,513,462

799,796,927

130,302,530

Packaged tour

319,566,156

205,141,896

357,643,161

58,267,051

Corporate travel

71,852,907

90,442,575

103,858,502

16,920,577

Others

34,141,394

45,842,408

47,873,735

7,799,566

Total revenues

1,640,486,219

1,819,505,794

2,259,471,659

368,112,033

Less: business tax and related surcharges

(99,510,607)

(97,244,864)

(129,901,116)

(21,163,427)

Net revenues

1,540,975,612

1,722,260,930

2,129,570,543

346,948,606

Cost of revenues

(379,121,709)

(478,601,393)

(588,980,230)

(95,956,375)

Gross profit

1,161,853,903

1,243,659,537

1,540,590,313

250,992,231

Operating expenses:

Product development *

(335,461,829)

(479,262,194)

(612,245,503)

(99,746,742)

Sales and marketing *

(354,501,850)

(479,274,011)

(598,185,788)

(97,456,140)

General and administrative *

(172,348,825)

(194,203,673)

(241,916,476)

(39,412,916)

Total operating expenses

(862,312,504)

(1,152,739,878)

(1,452,347,767)

(236,615,798)

Income from operations

299,541,399

90,919,659

88,242,546

14,376,433

Interest income ****

56,207,564

83,277,622

71,980,305

11,726,997

Interest expense ****

(3,595,298)

(33,693,033)

(45,175,681)

(7,360,000)

Other income

67,808,945

5,265,556

107,538,979

17,520,199

Income before income tax expense and equity in income

419,962,610

145,769,804

222,586,149

36,263,629

Income tax expense

(92,166,420)

(47,090,068)

(50,423,327)

(8,214,944)

Equity in income of affiliates

24,740,697

13,215,687

16,323,840

2,659,472

Net income

352,536,887

111,895,423

188,486,662

30,708,157

Less: Net loss attributable to noncontrolling interests

20,450,829

22,992,757

28,437,892

4,633,088

Net income attributable to Ctrip’s shareholders

372,987,716

134,888,180

216,924,554

35,341,245

Comprehensive income attributable to Ctrip’s shareholders

443,127,464

260,740,944

555,939,645

90,573,419

Earnings per ordinary share

– Basic

11.34

3.97

6.35

1.03

– Diluted

9.74

3.51

5.51

0.90

Earnings per ADS

– Basic

2.84

0.99

1.59

0.26

– Diluted

2.44

0.88

1.38

0.22

Weighted average ordinary shares outstanding

– Basic

32,887,276

33,952,472

34,166,995

34,166,995

– Diluted

38,745,348

39,339,689

39,905,707

39,905,707

* Share-based compensation charges included are as follows:

Product development

34,621,728

41,555,508

48,049,514

7,828,204

Sales and marketing

11,917,951

11,715,564

14,630,609

2,383,612

General and administrative

62,359,499

58,066,756

74,373,595

12,116,910

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

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

**** Interest expenses have been reclassified from interest income 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 September 30, 2014

GAAP Result

% of Net Revenues

Share-based Compensation

% of Net Revenues

Non-GAAP Result

% of Net Revenues

Product development

(612,245,503)

29%

48,049,514

2%

(564,195,989)

26%

Sales and marketing

(598,185,788)

28%

14,630,609

1%

(583,555,179)

27%

General and administrative

(241,916,476)

11%

74,373,595

3%

(167,542,881)

8%

Total operating expenses

(1,452,347,767)

68%

137,053,718

6%

(1,315,294,049)

62%

Income from operations

88,242,546

4%

137,053,718

6%

225,296,264

11%

Net income attributable to Ctrip’s shareholders

216,924,554

10%

137,053,718

6%

353,978,272

17%

Diluted earnings per ordinary share (RMB)

5.51

3.43

8.94

Diluted earnings per ADS (RMB)

1.38

0.86

2.24

Diluted earnings per ADS (USD)

0.22

0.14

0.36

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

Quarter Ended September 30, 2013

GAAP Result

% of Net Revenues

Share-based Compensation

% of Net Revenues

Non-GAAP Result

% of Net Revenues

Product development

(335,461,829)

22%

34,621,728

2%

(300,840,101)

20%

Sales and marketing

(354,501,850)

23%

11,917,951

1%

(342,583,899)

22%

General and administrative

(172,348,825)

11%

62,359,499

4%

(109,989,326)

7%

Total operating expenses

(862,312,504)

56%

108,899,178

7%

(753,413,326)

49%

Income from operations

299,541,399

19%

108,899,178

7%

408,440,577

27%

Net income attributable to Ctrip’s shareholders

372,987,716

24%

108,899,178

7%

481,886,894

31%

Diluted earnings per ordinary share (RMB)

9.74

2.81

12.55

Diluted earnings per ADS (RMB)

2.44

0.70

3.14

Diluted earnings per ADS (USD)

0.40

0.11

0.51

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=RMB6.138 on September 30, 2014 published by the Federal Reserve Board.

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/ctrip-reports-unaudited-third-quarter-2014-financial-results-300000942.html


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