Tuniu Announces Unaudited First Quarter 2018 Financial Results
Tuniu Announces Unaudited First Quarter 2018 Financial Results
Non-GAAP([1]) Net Loss in Q1 2018 Decreased by 89.5% Year-Over-Year
Added 51 Offline Retail Stores and 7 Local Tour Operators([2])
NANJING, China, May 24, 2018 /PRNewswire/ -- Tuniu Corporation (NASDAQ:TOUR) ("Tuniu" or the "Company"), a leading online leisure travel company in China, today announced its unaudited financial results for the first quarter ended March 31, 2018.
Highlights for the First Quarter of 2018
-- Revenues from package tours in the first quarter of 2018 increased by
13.1% year-over-year to RMB402.7 million (US$64.2 million([3])).
-- Operating expenses in the first quarter of 2018 decreased by 31.4%
year-over-year to RMB383.8 million (US$61.2 million).
-- Non-GAAP net loss was RMB23.8 million (US$3.8 million) in the first
quarter of 2018, compared to a Non-GAAP net loss of RMB226.2 million in
the first quarter of 2017.
-- As of April 30, 2018, Tuniu added 51 new offline retail stores during
the year.
-- As of April 30, 2018, Tuniu had 21 local tour operators in total,
including 7 newly launched local tour operators in China([4]) during
April.
Mr. Donald Dunde Yu, Tuniu's co-founder, Chairman and Chief Executive Officer, said, "As the leading online leisure travel company in China, we have developed a comprehensive sales network that allows us to efficiently acquire customers through various channels at different departure cities. With a solid foundation established through our sales network, our next step is to replicate the expansion model to our service network at destinations. As China's consumption power continues its upward trend, Chinese travelers are demanding better services and experiences. We believe that many of these demands are still unmet and there continues to be an opportunity for Tuniu to provide products and services consistent with current demands through its service network."
Ms. Maria Yi Xin, Tuniu's Chief Financial Officer, said, "During the first quarter, we were able to continue reducing our net loss. The development of our sales network served a vital role in the reduction of our sales and marketing expenses. Tuniu's new retail model continues to gain traction as customers acquired through our offline retail stores contributed more than 10% of our packaged tour GMV for the first time during this quarter. With our blended user acquisition cost declining from the expansion of our sales network, and bargaining power increasing from the development of our service network, Tuniu's operational efficiency will continue to scale in the future."
1. The section below entitled "About Non-GAAP Financial Measures" provides information about the use of
Non-GAAP financial measures in this press release, and the table captioned "Reconciliations of GAAP and
Non-GAAP Results" set forth at the end of this press release reconciles Non-GAAP financial information with the
Company's financial results under GAAP.
2. The section below entitled "Highlights for the First Quarter of 2018" provides additional information about
some key financial figures and operating data.
3. The conversion of Renminbi ("RMB") into United States dollars ("US$") is based on the exchange rate of
US$1.00=RMB6.2726 on March 30, 2018 as set forth in H.10 statistical release of the U.S. Federal Reserve Board
and available at https://www.federalreserve.gov/releases/h10/default.htm.
4. The 7 newly opened local tour operators are located in Huhehot, Taiyuan, Chengde, Hulunbuir, Harbin, Dalian
and Urumqi in China.
First Quarter 2018 Results
Net revenues were RMB480.5 million (US$76.6 million) in the first quarter of 2018, representing a year-over-year increase of 5.4% from the corresponding period in 2017.
-- Revenues from packaged tours, which are mainly recognized on a net
basis, were RMB402.7 million (US$64.2 million) in the first quarter of
2018, representing a year-over-year increase of 13.1% from the
corresponding period in 2017. The increase was primarily due to the
growth of organized tours and self-guided tours.
-- Other revenues were RMB77.9 million (US$12.4 million) in the first
quarter of 2018, representing a year-over-year decrease of 22.2% from
the corresponding period in 2017. The decrease was primarily due to the
decline in revenues generated from financial services, commission fees
received from air ticketing and service fees received from insurance
companies.
Cost of revenues was RMB217.9 million (US$34.7 million) in the first quarter of 2018, representing a year-over-year increase of 6.4% from the corresponding period in 2017. As a percentage of net revenues, cost of revenues was 45.3% in the first quarter of 2018 compared to 44.9% in the corresponding period in 2017.
Gross profit was RMB262.6 million (US$41.9 million) in the first quarter of 2018, representing a year-over-year increase of 4.5% from the corresponding period in 2017. The increase was primarily due to the increase in efficiency resulting from economies of scale.
Operating expenses were RMB383.8 million (US$61.2 million) in the first quarter of 2018, representing a year-over-year decrease of 31.4% from the corresponding period in 2017. Share-based compensation expenses and amortization of acquired intangible assets, which were allocated to operating expenses, were RMB47.5 million (US$7.6 million) in the first quarter of 2018. Non-GAAP operating expenses, which excluded share-based compensation expenses and amortization of acquired intangible assets, were RMB336.3 million (US$53.6 million) in the first quarter of 2018, representing a year-over-year decrease of 32.5%.
-- Research and product development expenses were RMB84.1 million (US$13.4
million) in the first quarter of 2018, representing a year-over-year
decrease of 47.3%. Non-GAAP research and product development expenses,
which excluded share-based compensation expenses and amortization of
acquired intangible assets of RMB1.7 million (US$0.3 million), were
RMB82.4 million (US$13.1 million) in the first quarter of 2018,
representing a year-over-year decrease of 47.6% from the corresponding
period in 2017. Research and product development expenses as a
percentage of net revenues were 17.5% in the first quarter of 2018,
decreasing from 35.0% in the corresponding period in 2017. The decrease
was primarily due to the increase in efficiency resulting from economies
of scale and refined management, and optimization of research and
product development personnel.
-- Sales and marketing expenses were RMB185.8 million (US$29.6 million) in
the first quarter of 2018, representing a year-over-year decrease of
26.8%. Non-GAAP sales and marketing expenses, which excluded share-based
compensation expenses and amortization of acquired intangible assets of
RMB34.3 million (US$5.5 million), were RMB151.5 million (US$24.1
million) in the first quarter of 2018, representing a year-over-year
decrease of 30.9% from the corresponding period in 2017. Sales and
marketing expenses as a percentage of net revenues were 38.7% in the
first quarter of 2018, decreasing from 55.6% in the corresponding period
in 2017. The decrease was primarily due to the optimization of
promotional expense structure and preference for marketing channels with
higher ROI.
-- General and administrative expenses were RMB114.6 million (US$18.3
million) in the first quarter of 2018, representing a year-over-year
decrease of 24.3%. Non-GAAP general and administrative expenses, which
excluded share-based compensation expenses and amortization of acquired
intangible assets of RMB11.5 million (US$1.8 million), were RMB103.1
million (US$16.4 million) in the first quarter of 2018, representing a
year-over-year decrease of 19.0% from the corresponding period in 2017.
General and administrative expenses as a percentage of net revenues were
23.9% in the first quarter of 2018, decreasing from 33.2% in the
corresponding period in 2017. The decrease was primarily due to the
increase in efficiency resulting from economies of scale and decline in
personnel related fees.
Loss from operations was RMB121.1 million (US$19.3 million) in the first quarter of 2018, compared to a loss from operations of RMB308.0 million in the first quarter of 2017. Non-GAAP loss from operations, which excluded share-based compensation expenses and amortization of acquired intangible assets, was RMB73.4 million (US$11.7 million) in the first quarter of 2018.
Net loss was RMB71.6 million (US$11.4 million) in the first quarter of 2018, compared to a net loss of RMB287.4 million in the first quarter of 2017. Non-GAAP net loss, which excluded share-based compensation expenses and amortization of acquired intangible assets, was RMB23.8 million (US$3.8 million) in the first quarter of 2018.
Net loss attributable to ordinary shareholders was RMB74.7 million (US$11.9 million) in the first quarter of 2018, compared to a net loss attributable to ordinary shareholders of RMB288.2 million in the first quarter of 2017. Non-GAAP net loss attributable to ordinary shareholders, which excluded share-based compensation expenses and amortization of acquired intangible assets, was RMB26.9 million (US$4.3 million) in the first quarter of 2018.
As of March 31, 2018, the Company had cash and cash equivalents, restricted cash and short-term investments of RMB3.1 billion (US$500.3 million).
Business Outlook
For the second quarter of 2018, Tuniu expects to generate RMB519.9 million to RMB538.3 million of net revenues, which represents 13% to 17% growth year-over-year. This forecast reflects Tuniu's current and preliminary view on the industry and its operations, which is subject to change.
Conference Call Information
Tuniu's management will hold an earnings conference call at 8:00 am U.S. Eastern Time, on May 24, 2018, (8:00 pm, Beijing/Hong Kong Time, on May 24, 2018) to discuss the first quarter 2018 financial results.
To participate in the conference call, please dial the following numbers:
US: +1-888-346-8982
Hong Kong: 800-905945
China: 4001-201203
International: +1-412-902-4272
Conference ID: Tuniu 1Q 2018 Earnings Call
A telephone replay will be available one hour after the end of the conference through May 31, 2018. The dial-in details are as follows:
US: +1-877-344-7529
International: +1-412-317-0088
Replay Access Code: 10120454
Additionally, a live and archived webcast of the conference call will also be available on the Company's investor relations website at http://ir.tuniu.com.
About Tuniu
Tuniu (Nasdaq:TOUR) is a leading online leisure travel company in China that offers a large selection of packaged tours, including organized and self-guided tours, as well as travel-related services for leisure travelers through its website tuniu.com and mobile platform. Tuniu has over 2,000,000 stock keeping units (SKUs) of packaged tours, covering over 420 departing cities throughout China and all popular destinations worldwide. Tuniu provides one-stop leisure travel solutions and a compelling customer experience through its online platform and offline service network. For more information, please visit http://ir.tuniu.com.
Safe Harbor Statement
This press release contains forward-looking statements made under the "safe harbor" provisions of Section 21E of the Securities Exchange Act of 1934, as amended, and 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," "confident" and similar statements. Tuniu may also make written or oral forward-looking statements in its reports filed with or furnished to the U.S. Securities and Exchange Commission, in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Any statements that are not historical facts, including statements about Tuniu's beliefs and expectations, 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, but are not limited to the following: Tuniu's goals and strategies; the growth of the online leisure travel market in China; the demand for Tuniu's products and services; its relationships with customers and travel suppliers; the Company's ability to offer competitive travel products and services; Tuniu's future business development, results of operations and financial condition; competition in the online travel industry in China; relevant government policies and regulations relating to the Company's structure, business and industry; and the general economic and business condition in China and elsewhere. Further information regarding these and other risks, uncertainties or factors is included in the Company's filings with the U.S. Securities and Exchange Commission. All information provided in this press release is current as of the date of the press release, and Tuniu does not undertake any obligation to update such information, except as required under applicable law.
About Non-GAAP Financial Measures
To supplement the Company's unaudited consolidated financial results presented in accordance with United States Generally Accepted Accounting Principles ("GAAP"), the Company has provided non-GAAP information related to cost of revenues, research and product development expenses, sales and marketing expenses, general and administrative expenses, operating expenses, loss from operations, net loss, net loss attributable to ordinary shareholders, net loss per ordinary share attributable to ordinary shareholders-basic and diluted and net loss per ADS, which excludes share-based compensation expenses and amortization of acquired intangible assets. We believe that the non-GAAP financial measures used in this press release are useful for understanding and assessing underlying business performance and operating trends, and management and investors benefit from referring to these non-GAAP financial measures in assessing our financial performance and when planning and forecasting future periods. 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.
A limitation of using non-GAAP financial measures excluding share-based compensation expenses and amortization of acquired intangible assets is that share-based compensation expenses and amortization of acquired intangible assets have been - and will continue to be - significant recurring expenses in the Company's business. You should not view non-GAAP results on a stand-alone basis or as a substitute for results under GAAP, or as being comparable to results reported or forecasted by other companies.
For investor and media inquiries, please contact:
China
Mary Chen
Investor Relations Director
Tuniu Corporation
Phone: +86-25-6960-9988
E-mail: ir@tuniu.com
Tuniu Corporation
Unaudited Condensed Consolidated Balance Sheets
(All amounts in thousands, except per share information)
December 31, 2017 March 31, 2018 March 31, 2018
RMB RMB US$
--- --- ---
ASSETS
Current assets
Cash and cash equivalents 484,101 612,269 97,610
Restricted cash 91,810 145,904 23,261
Short-term investments 3,084,634 2,379,946 379,419
Accounts receivable, net 286,627 327,759 52,252
Amounts due from related parties 171,331 114,310 18,224
Prepayments and other current assets 939,463 990,806 157,958
Yield enhancement products and accrued interest 31,337 6,708 1,069
------ ----- -----
Total current assets 5,089,303 4,577,702 729,793
--------- --------- -------
Non-current assets
Long term investments 484,991 993,319 158,358
Property and equipment, net 148,278 148,919 23,741
Intangible assets, net 460,634 426,076 67,927
Goodwill 147,639 147,639 23,537
Yield enhancement products over one year and 170,505 106,569 16,990
accrued interest
Other non-current assets 156,455 166,558 26,553
Total non-current assets 1,568,502 1,989,080 317,106
--------- --------- -------
Total assets 6,657,805 6,566,782 1,046,899
--------- --------- ---------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable 852,500 1,161,487 185,168
Amounts due to related parties 86,923 83,541 13,318
Salary and welfare payable 187,561 99,822 15,914
Taxes payable 32,036 18,101 2,886
Advances from customers 1,210,615 1,033,293 164,731
Accrued expenses and other current liabilities 373,690 399,541 63,695
Amounts due to the individual investors of yield 177,971 141,012 22,481
enhancement products
Total current liabilities 2,921,296 2,936,797 468,193
--------- --------- -------
Non-current liabilities 42,481 40,842 6,511
------ ------ -----
Total liabilities 2,963,777 2,977,639 474,704
--------- --------- -------
Mezzanine equity
Redeemable noncontrolling interests 96,719 98,528 15,708
Shareholders' equity
Ordinary shares 248 248 40
Less: Treasury stock (185,419) (203,717) (32,477)
Additional paid-in capital 9,013,793 9,025,354 1,438,854
Accumulated other comprehensive income 272,386 243,934 38,889
Accumulated deficit (5,505,897) (5,579,701) (889,536)
---------- ---------- --------
Total Tuniu's shareholders' equity 3,595,111 3,486,118 555,770
Noncontrolling interests 2,198 4,497 717
----- ----- ---
Total Shareholders' equity 3,597,309 3,490,615 556,487
--------- --------- -------
Total liabilities and shareholders' equity 6,657,805 6,566,782 1,046,899
========= ========= =========
Tuniu Corporation
Unaudited Condensed Consolidated Statements of Comprehensive Loss
(All amounts in thousands, except per share information)
Quarter Ended Quarter Ended Quarter Ended Quarter Ended
March 31, 2017 December 31, 2017 March 31, 2018 March 31, 2018
RMB RMB RMB US$
--- --- --- ---
Revenues
Packaged tours 355,948 290,054 402,679 64,197
Others 100,093 179,832 77,854 12,412
------- ------- ------ ------
Net revenues 456,041 469,886 480,533 76,609
Cost of revenues (204,737) (234,733) (217,907) (34,740)
-------- -------- -------- -------
Gross profit 251,304 235,153 262,626 41,869
------- ------- ------- ------
Operating expenses
Research and product development (159,403) (111,151) (84,054) (13,400)
Sales and marketing (253,756) (193,696) (185,831) (29,626)
General and administrative (151,333) (154,490) (114,609) (18,271)
Other operating income 5,223 3,348 735 117
Total operating expenses (559,269) (455,989) (383,759) (61,180)
-------- -------- -------- -------
Loss from operations (307,965) (220,836) (121,133) (19,311)
Other income/(expenses)
Interest income 22,954 44,426 39,474 6,293
Foreign exchange gains/(losses), net (1,370) (2,009) 5,977 953
Other income/(loss), net 429 (147) 7,945 1,267
--- ---- ----- -----
Loss before income tax expense (285,952) (178,566) (67,737) (10,798)
Income tax expense (1,406) (7,569) (3,828) (610)
------ ------ ------ ----
Net loss (287,358) (186,135) (71,565) (11,408)
Net income/(loss) attributable to (751) (2,939) 1,299 207
noncontrolling interests
Net income/(loss) attributable to redeemable 275 (93) 940 150
noncontrolling interests
Net loss attributable to Tuniu Corporation (286,882) (183,103) (73,804) (11,765)
-------- -------- ------- -------
Accretion on redeemable noncontrolling (1,356) (1,757) (869) (139)
interest
Net loss attributable to ordinary (288,238) (184,860) (74,673) (11,904)
shareholders
Net loss (287,358) (186,135) (71,565) (11,408)
Other comprehensive income loss:
Foreign currency translation adjustment, net (19,190) (24,770) (28,452) (4,536)
of nil tax
Comprehensive loss (306,548) (210,905) (100,017) (15,944)
======== ======== ======== =======
Loss per share
Net loss per ordinary share attributable to (0.76) (0.48) (0.19) (0.03)
ordinary shareholders - basic and diluted
Net loss per ADS - basic and diluted* (2.28) (1.44) (0.57) (0.09)
Weighted average number of ordinary shares 378,164,347 387,993,534 388,843,912 388,843,912
used in computing basic and diluted loss per
share
Share-based compensation expenses included are as follows?
Cost of revenues 321 230 227 36
Research and product development 1,784 1,324 1,260 201
Sales and marketing 477 201 185 29
General and administrative 23,139 17,089 10,709 1,707
Total 25,721 18,844 12,381 1,973
====== ====== ====== =====
*Each ADS represents three of the Company's ordinary shares.
Reconciliations of GAAP and Non-GAAP Results
(All amounts in thousands, except per share information)
Quarter Ended March 31, 2018
----------------------------
GAAP Result Share-based Amortization of acquired Non-GAAP
-----------
Compensation intangible assets Result
------------ ----------------- ------
Cost of revenues (217,907) 227 - (217,680)
Research and product development (84,054) 1,260 399 (82,395)
Sales and marketing (185,831) 185 34,163 (151,483)
General and administrative (114,609) 10,709 781 (103,119)
Other operating income 735 - - 735
Total operating expenses (383,759) 12,154 35,343 (336,262)
======== ====== ====== ========
Loss from operations (121,133) 12,381 35,343 (73,409)
Net loss (71,565) 12,381 35,343 (23,841)
Net loss attributable to ordinary shareholders (74,673) 12,381 35,343 (26,949)
Net loss per ordinary share attributable to (0.19) (0.07)
ordinary shareholders - basic and diluted (RMB)
Net loss per ADS - basic and diluted (RMB) (0.57) (0.21)
Weighted average number of ordinary shares 388,843,912
used in computing basic and diluted loss per
share 388,843,912
Quarter Ended December 31, 2017
-------------------------------
GAAP Result Share-based Amortization of acquired Non-GAAP
-----------
Compensation intangible assets Result
------------ ----------------- ------
Cost of revenues (234,733) 230 - (234,503)
Research and product development (111,151) 1,324 399 (109,428)
Sales and marketing (193,696) 201 34,163 (159,332)
General and administrative (154,490) 17,089 777 (136,624)
Other operating income 3,348 - - 3,348
Total operating expenses (455,989) 18,614 35,339 (402,036)
======== ====== ====== ========
Loss from operations (220,836) 18,844 35,339 (166,653)
Net loss (186,135) 18,844 35,339 (131,952)
Net loss attributable to ordinary shareholders (184,860) 18,844 35,339 (130,677)
Net loss per ordinary share attributable to (0.48) (0.34)
ordinary shareholders - basic and diluted (RMB)
Net loss per ADS - basic and diluted (RMB) (1.44) (1.02)
Weighted average number of ordinary shares 387,993,534 387,993,534
used in computing basic and diluted loss per
share
Quarter Ended March 31, 2017
----------------------------
GAAP Result Share-based Amortization of acquired Non-GAAP
-----------
Compensation intangible assets Result
------------ ----------------- ------
Cost of revenues (204,737) 321 - (204,416)
Research and product development (159,403) 1,783 399 (157,221)
Sales and marketing (253,756) 477 34,163 (219,116)
General and administrative (151,333) 23,139 827 (127,367)
Other operating income 5,223 - - 5,223
Total operating expenses (559,269) 25,399 35,389 (498,481)
======== ====== ====== ========
Loss from operations (307,965) 25,720 35,389 (246,856)
Net loss (287,358) 25,720 35,389 (226,249)
Net loss attributable to ordinary shareholders (288,238) 25,720 35,389 (227,129)
Net loss per ordinary share attributable to (0.76) (0.60)
ordinary shareholders - basic and diluted (RMB)
Net loss per ADS - basic and diluted (RMB) (2.28) (1.80)
Weighted average number of ordinary shares 378,164,347
used in computing basic and diluted loss per
share 378,164,347
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