Tuniu Announces Unaudited Third Quarter 2019 Financial Results
NANJING, China, Nov. 19, 2019 /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 third quarter ended September 30, 2019.
Highlights for the Third Quarter of 2019
-- Revenues from packaged tours in the third quarter of 2019 increased by
18.1% year-over-year to RMB747.1 million (US$104.5 million([1]))
-- Non-GAAP([2]) net income was RMB39.0 million (US$5.5 million) in the
third quarter of 2019.
Mr. Donald Dunde Yu, Tuniu's founder, Chairman and Chief Executive Officer, said, "We continue to revolve our strategies around the development of our S2B2C ecosystem. As consumer demand for higher-quality products shifts upwards in accordance with increasing purchasing power, it is crucial for Tuniu to increase our standards. Our emphasis on the continual improvement of our product, our service and our technology will be key to increasing user satisfaction rating, which in turn means higher repurchase rate and pricing power for Tuniu. We will leverage our established networks, consisting of both online and offline channels, to distribute Tuniu's high-quality products, namely Niu Tour and Tuniu Selection, to customers across China. By providing superior experiences to our customers, Tuniu will be able to stimulate repurchase rate and propel our growth into a stable upward trajectory."
Ms. Maria Yi Xin, Tuniu's Chief Financial Officer, said, "During the quarter, growth of packaged tour revenues recovered to double digits. For the third consecutive year, we were able to achieve non-GAAP profitability during our peak season in the third quarter. Our direct-procurement products and local tour operators continue to make increasingly significant financial contribution. Furthermore, Tuniu's commitment to automation has resulted in notable improvements to efficiency and expense control. Going forward, we expect the company to make meaningful steps toward unlocking more value for our customers and shareholders."
[1] The conversion of Renminbi ("RMB") into United States dollars ("US$") is based on the exchange
rate of US$1.00=RMB7.1477 on September 30, 2019 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.
[2] 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.
Third Quarter 2019 Results
Net revenues were RMB852.5 million (US$119.3 million) in the third quarter of 2019, representing a year-over-year increase of 11.7% from the corresponding period in 2018.
-- Revenues from packaged tours were RMB747.1 million (US$104.5 million) in
the third quarter of 2019, representing a year-over-year increase of
18.1% from the corresponding period in 2018. The increase was primarily
due to the growth of organized tours.
-- Other revenues were RMB105.4 million (US$14.7 million) in the third
quarter of 2019, representing a year-over-year decrease of 19.2% from
the corresponding period in 2018. The decrease was primarily due to the
decline in revenues generated from financial services and service fees
received from insurance companies.
Cost of revenues was RMB472.0 million (US$66.0 million) in the third quarter of 2019, representing a year-over-year increase of 27.0% from the corresponding period in 2018. As a percentage of net revenues, cost of revenues was 55.4% in the third quarter of 2019 compared to 48.7% in the corresponding period in 2018.
Gross profit was RMB380.5 million (US$53.2 million) in the third quarter of 2019, representing a year-over-year decrease of 2.8% from the corresponding period in 2018.
Operating expenses were RMB437.3 million (US$61.2 million) in the third quarter of 2019, representing a year-over-year increase of 10.7% from the corresponding period in 2018. Share-based compensation expenses and amortization of acquired intangible assets, which were allocated to operating expenses, were RMB51.6 million (US$7.2 million) in the third quarter of 2019. Non-GAAP operating expenses, which excluded share-based compensation expenses and amortization of acquired intangible assets, were RMB385.7 million (US$54.0 million) in the third quarter of 2019, representing a year-over-year increase of 13.2%.
-- Research and product development expenses were RMB64.3 million (US$9.0
million) in the third quarter of 2019, representing a year-over-year
decrease of 17.8%. Non-GAAP research and product development expenses,
which excluded share-based compensation expenses and amortization of
acquired intangible assets of RMB2.6 million (US$0.4 million), were
RMB61.7 million (US$8.6 million) in the third quarter of 2019,
representing a year-over-year decrease of 16.7% from the corresponding
period in 2018. The decrease was primarily due to the improvement in
efficiency resulting from the increased level of automation applied in
research and product development activities, and optimization of
research and product development personnel.
-- Sales and marketing expenses were RMB240.0 million (US$33.6 million) in
the third quarter of 2019, representing a year-over-year increase of
14.5%. Non-GAAP sales and marketing expenses, which excluded share-based
compensation expenses and amortization of acquired intangible assets of
RMB35.0 million (US$4.9 million), were RMB204.9 million (US$28.7
million) in the third quarter of 2019, representing a year-over-year
increase of 17.2% from the corresponding period in 2018. The increase
was primarily due to the expansion of our offline retail stores.
-- General and administrative expenses were RMB138.5 million (US$19.4
million) in the third quarter of 2019, representing a year-over-year
increase of 12.6%. Non-GAAP general and administrative expenses, which
excluded share-based compensation expenses and amortization of acquired
intangible assets of RMB14.0 million (US$2.0 million), were RMB124.5
million (US$17.4 million) in the third quarter of 2019, representing a
year-over-year increase of 15.9% from the corresponding period in 2018.
The increase was primarily due to an increase in general and
administrative personnel related expenses.
Loss from operations was RMB56.9 million (US$8.0 million) in the third quarter of 2019, compared to a loss from operations of RMB3.6 million in the third quarter of 2018. Non-GAAP loss from operations, which excluded share-based compensation expenses and amortization of acquired intangible assets, was RMB5.2 million (US$0.7 million) in the third quarter of 2019.
Net loss was RMB12.6 million (US$1.8 million) in the third quarter of 2019, compared to a net income of RMB28.0 million in the third quarter of 2018. Non-GAAP net income, which excluded share-based compensation expenses and amortization of acquired intangible assets, was RMB39.0 million (US$5.5 million) in the third quarter of 2019.
Net loss attributable to ordinary shareholders was RMB13.5 million (US$1.9 million) in the third quarter of 2019, compared to a net income attributable to ordinary shareholders of RMB31.0 million in the third quarter of 2018. Non-GAAP net income attributable to ordinary shareholders, which excluded share-based compensation expenses and amortization of acquired intangible assets, was RMB38.2 million (US5.3 million) in the third quarter of 2019.
As of September 30, 2019, the Company had cash and cash equivalents, restricted cash and short-term investments of RMB2.2 billion (US$305.7 million).
Business Outlook
For the fourth quarter of 2019, Tuniu expects to generate RMB438.2 million to RMB461.8 million of net revenues, which represents 2% to 7% decrease 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 November 19, 2019, (9:00 pm, Beijing/Hong Kong Time, on November 19, 2019) to discuss the third quarter 2019 financial results.
To participate in the conference call, please dial the following numbers:
US: +1-888-346-8982
Hong Kong: +852-301-84992
Mainland China: 4001-201203
International: +1-412-902-4272
Conference ID: Tuniu 3Q 2019 Earnings Call
A telephone replay will be available one hour after the end of the conference through November 26, 2019. The dial-in details are as follows:
US: +1-877-344-7529
International: +1-412-317-0088
Replay Access Code: 10136878
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 covers 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, including over 3,000 professional customer service representatives, 24/7 call centers, approximately 500 offline retail stores and 34 self-operated local tour operators. 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
(Financial Tables Follow)
Tuniu Corporation
Unaudited Condensed Consolidated Balance Sheets
(All amounts in thousands, except per share information)
December 31, 2018
September 30, 2019
September 30, 2019
RMB
RMB
US$
---
ASSETS
Current assets
Cash and cash equivalents 560,356 411,124 57,518
Restricted cash 270,670 260,232 36,408
Short-term investments 859,211 1,513,781 211,786
Accounts receivable, net 347,547 520,260 72,787
Amounts due from related parties 696,520 118,037 16,514
Prepayments and other current assets 1,673,584 1,444,967 202,159
Total current assets 4,407,888 4,268,401 597,172
Non-current assets
Long-term investments 1,302,506 1,376,010 192,511
Property and equipment, net 187,360 223,656 31,291
Intangible assets, net 317,885 218,514 30,571
Land use right, net 100,836 99,290 13,891
Operating lease right-of-use assets, net* - 162,662 22,757
Goodwill 159,409 184,569 25,822
Other non-current assets 81,039 86,993 12,171
Long-term amounts due from related parties - 523,269 73,208
Total non-current assets 2,149,035 2,874,963 402,222
Total assets 6,556,923 7,143,364 999,394
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Short-term borrowings 49,312 144,260 20,183
Accounts and notes payable 1,305,610 1,811,032 253,373
Amounts due to related parties 77,159 58,067 8,124
Salary and welfare payable 104,480 91,871 12,853
Taxes payable 23,316 6,665 932
Advances from customers 1,058,946 960,065 134,318
Operating lease liabilities, current* - 83,834 11,729
Accrued expenses and other current liabilities 483,832 698,149 97,675
Total current liabilities 3,102,655 3,853,943 539,187
Non-current liabilities
Operating lease liabilities, non-current* - 81,331 11,379
Deferred tax liabilities 19,855 20,047 2,805
Long-term borrowings 4,492 10,486 1,467
Other non-current liabilities 16,069 12,709 1,778
Total non-current liabilities 40,416 124,573 17,429
Total liabilities 3,143,071 3,978,516 556,616
Mezzanine equity
Redeemable noncontrolling interests 69,319 73,270 10,251
Shareholders' equity
Ordinary shares 249 249 35
Less: Treasury stock (304,535) (311,217) (43,541)
Additional paid-in capital 9,061,979 9,108,243 1,274,290
Accumulated other comprehensive income 284,079 298,723 41,793
Accumulated deficit (5,691,409) (6,020,377) (842,282)
Total Tuniu's shareholders' equity 3,350,363 3,075,621 430,295
Noncontrolling interests (5,830) 15,957 2,232
Total Shareholders' equity 3,344,533 3,091,578 432,527
Total liabilities and shareholders' equity 6,556,923 7,143,364 999,394
*On 1 January 2019, the Company adopted ASC 842, Leases and used the optional transition method to initially apply this
new lease standard at the adoption date. Right-of-use assets and lease liabilities were recognized on the Company's consolidated
financial statements.
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
September 30,
June 30,
September 30,
September 30,
2018 2019 2019 2019
RMB
RMB
RMB
US$
---
Revenues
Packaged tours 632,723 429,482 747,122 104,526
Others 130,408 90,848 105,395 14,745
Net revenues 763,131 520,330 852,517 119,271
Cost of revenues (371,622) (287,330) (472,040) (66,041)
Gross profit 391,509 233,000 380,477 53,230
Operating expenses
Research and product development (78,270) (80,197) (64,310) (8,997)
Sales and marketing (209,563) (224,582) (239,973) (33,573)
General and administrative (122,936) (134,389) (138,456) (19,371)
Other operating income 15,656 6,925 5,406 756
Total operating expenses (395,113) (432,243) (437,333) (61,185)
Loss from operations (3,604) (199,243) (56,856) (7,955)
Other income/(expenses)
Interest and investment income 38,167 36,645 42,780 5,985
Interest expense (1,724) (6,970) (8,900) (1,245)
Foreign exchange (losses)/gains, net (9,030) 1,090 (5,190) (726)
Other income, net 3,017 586 14,847 2,077
Income/(loss) before income tax expense 26,826 (167,892) (13,319) (1,864)
Income tax benefit 1,126 738 698 98
Net income/(loss) 27,952 (167,154) (12,621) (1,766)
Net loss attributable to noncontrolling interests (4,104) (444) (565) (79)
Net income/(loss) attributable to redeemable noncontrolling 831 245 (102) (14)
interests
Net income/(loss) attributable to Tuniu Corporation 31,225 (166,955) (11,954) (1,673)
Accretion on redeemable noncontrolling interest (204) (1,033) (1,518) (212)
Net income/(loss) attributable to ordinary shareholders 31,021 (167,988) (13,472) (1,885)
Net income/(loss) 27,952 (167,154) (12,621) (1,766)
Other comprehensive income:
Foreign currency translation adjustment, net of nil tax 16,342 7,110 12,276 1,717
Comprehensive income/(loss) 44,294 (160,044) (345) (49)
Income/(Loss) per share
Basic 0.08 (0.45) (0.04) (0.01)
Diluted 0.08 (0.45) (0.04) (0.01)
Income/(Loss) per ADS*
Basic 0.24 (1.35) (0.12) (0.03)
Diluted 0.24 (1.35) (0.12) (0.03)
Weighted average number of ordinary shares used in 370,412,795 369,343,738 369,559,765 369,559,765
computing basic income/(loss) per share
Weighted average number of ordinary shares used in 379,333,481 369,343,738 369,559,765 369,559,765
computing diluted income/(loss) per share
Share-based compensation expenses included are
as follows:
Cost of revenues 614 1,827 52 7
Research and product development 3,790 4,112 2,065 289
Sales and marketing 556 1,519 119 17
General and administrative 14,731 8,723 13,294 1,860
Total 19,691 16,181 15,530 2,173
*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 September 30, 2019
GAAP
Share-based
Amortization of acquired
Non-GAAP
Result
Compensation
intangible assets
Result
---
Cost of revenues (472,040) 52 (471,988)
Research and product development (64,310) 2,065 513 (61,732)
Sales and marketing (239,973) 119 34,907 (204,947)
General and administrative (138,456) 13,294 705 (124,457)
Other operating income 5,406 5,406
Total operating expenses (437,333) 15,478 36,125 (385,730)
Loss from operations (56,856) 15,530 36,125 (5,201)
Net (Loss)/Income (12,621) 15,530 36,125 39,034
Net (Loss)/Income attributable to ordinary (13,472) 15,530 36,125 38,183
shareholders
Net (loss)/income per ordinary share attributable to
ordinary shareholders(RMB)
-Basic (0.04) 0.10
-Diluted (0.04) 0.10
Net (loss)/income per ADS (RMB)
-Basic (0.12) 0.30
-Diluted (0.12) 0.30
Weighted average number of ordinary shares
-Basic 369,559,765 369,559,765
-Diluted 369,559,765 379,770,193
Quarter Ended June 30, 2019
GAAP
Share-based
Amortization of acquired
Non-GAAP
Result
Compensation
intangible assets
Result
---
Cost of revenues (287,330) 1,827 (285,503)
Research and product development (80,197) 4,112 513 (75,572)
Sales and marketing (224,582) 1,519 34,163 (188,900)
General and administrative (134,389) 8,723 704 (124,962)
Other operating income 6,925 6,925
Total operating expenses (432,243) 14,354 35,380 (382,509)
Loss from operations (199,243) 16,181 35,380 (147,682)
Net loss (167,154) 16,181 35,380 (115,593)
Net loss attributable to ordinary shareholders (167,988) 16,181 35,380 (116,427)
Net loss per ordinary share attributable to ordinary (0.45) (0.32)
shareholders - basic and diluted (RMB)
Net loss per ADS - basic and diluted (RMB) (1.35) (0.96)
Weighted average number of ordinary shares used 369,343,738 369,343,738
in computing basic and diluted loss per share
Quarter Ended September 30, 2018
GAAP
Share-based
Amortization of acquired
Non-GAAP
Result
Compensation
intangible assets
Result
---
Cost of revenues (371,622) 614 (371,008)
Research and product development (78,270) 3,790 399 (74,081)
Sales and marketing (209,563) 556 34,163 (174,844)
General and administrative (122,936) 14,731 781 (107,424)
Other operating income 15,656 15,656
Total operating expenses (395,113) 19,077 35,343 (340,693)
(Loss)/Income from operations (3,604) 19,691 35,343 51,430
Net income 27,952 19,691 35,343 82,986
Net income attributable to ordinary shareholders 31,021 19,691 35,343 86,055
Net income per ordinary share attributable to
ordinary shareholders(RMB)
-Basic 0.08 0.23
-Diluted 0.08 0.23
Net income per ADS (RMB)
-Basic 0.24 0.69
-Diluted 0.24 0.69
Weighted average number of ordinary shares
-Basic 370,412,795 370,412,795
-Diluted 379,333,481 379,333,481
*Basic net loss per ordinary share attributable to ordinary shareholders is calculated by dividing net loss attributable to ordinary
shareholders by the weighted average number of ordinary shares outstanding during the periods. Diluted net loss per ordinary
share attributable to ordinary shareholders is calculated by dividing net loss attributable to ordinary shareholders by the weighted
average number of ordinary shares and dilutive potential ordinary shares outstanding during the periods, including the dilutive effect
of share-based awards as determined under the treasury stock method.
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