CTRP » Topics » Fourth Quarter and Full Year 2007 Financial Results

This excerpt taken from the CTRP 6-K filed Feb 28, 2008.

Fourth Quarter and Full Year 2007 Financial Results

For the fourth quarter of 2007, Ctrip reported total revenues of RMB383 million (US$53 million), representing a 59% increase from the same period in 2006 and an 11% increase from the previous quarter in 2007.

For the full year ended December 31, 2007, total revenues were RMB1.3 billion (US$176 million), representing a 54% increase from 2006.

Hotel reservation revenues amounted to RMB196 million (US$27 million) for the fourth quarter of 2007, representing a 42% increase from the same period in 2006 and a 12% increase from the previous quarter, primarily due to increased hotel booking volume.

For the full year ended December 31, 2007, hotel reservation revenues were RMB677 million (US$93 million), a 42% increase from 2006. The hotel reservation revenues accounted for 53% of the total revenues in 2007, compared to 57% in 2006.

Air ticket booking revenues for the fourth quarter of 2007 were RMB154 million (US$21 million), representing a 78% increase from the same period in 2006 and a 12% increase from the previous quarter, primarily due to increased air ticketing volume and commission.

For the full year ended December 31, 2007, air ticket booking revenues were RMB503 million (US$69 million), a 72% increase from 2006. The air ticket booking revenues accounted for 39% of the total revenues in 2007, compared to 35% in 2006.

Packaged-tour revenues for the fourth quarter of 2007 were RMB22 million (US$3 million), up 100% from the same period in 2006 and 6% from the previous quarter, primarily due to increased travel demand in the fourth quarter of 2007.

 

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For the full year ended December 31, 2007, packaged tour revenues were RMB71 million (US$10 million), a 71% increase from 2006. The packaged tour revenues accounted for 6% of the total revenues in 2007, compared to 5% in 2006.

For the fourth quarter of 2007, net revenues were RMB356 million (US$49 million), a 58% increase from the same period in 2006. Net revenues increased by 10% from the previous quarter in 2007.

For the full year ended December 31, 2007, net revenues were RMB1.2 billion (US$164 million), a 54% increase from 2006.

Gross margin was 81% in the fourth quarter of 2007, compared to 80% for the same period in 2006 and in the previous quarter.

For the full year ended December 31, 2007, gross margin was 80%, remained consistent with 2006.

Product development expenses for the fourth quarter of 2007 increased by 73% to RMB54 million (US$7 million) from the same period in 2006 and increased by 12% compared to the previous quarter, primarily due to the increase of product development personnel resources. Excluding share-based compensation charges (non-GAAP), product development expenses accounted for 13% of the net revenues, increased slightly from 12% in the same period last year and remained consistent with the previous quarter.

For the full year ended December 31, 2007, product development expenses were RMB177 million (US$24 million), increased by 67% from 2006. Excluding share-based compensation charges (non-GAAP), product development expenses accounted for 13% of the net revenues, increased slightly from 12% in 2006.

Sales and marketing expenses for the fourth quarter of 2007 increased by 49% to RMB72 million (US$10 million) from the same period in 2006 and 14% from the previous quarter, primarily due to the increase of sales and marketing personnel resources. Excluding share-based compensation charges (non-GAAP), sales and marketing expenses accounted for 19% of the net revenues, decreased from 21% in the same period last year and remained consistent with previous quarter.

For the full year ended December 31, 2007, sales and marketing expenses were RMB243 million (US$33 million), increase by 41% from 2006. Excluding share-based compensation charges (non-GAAP), sales and marketing expenses accounted for 19% of the net revenues, decreased from 21% in 2006.

General and administrative expenses for the fourth quarter of 2007 increased by 45% to RMB36 million (US$5 million) from the same period in 2006, primarily due to the increase of personnel resources and share-based compensation charges. General and administrative expenses remained relatively consistent with the previous quarter. Excluding share-based compensation charges (non-GAAP), general and administrative expenses accounted for 7% of the net revenues, decreased from 8% in the same period last year and remained consistent with the previous quarter.

 

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For the full year ended December 31, 2007, general and administrative expenses were RMB138 million (US$19 million), increased by 48% from 2006, primarily due to the increase of personnel resources and share-based compensation charges. Excluding share-based compensation charges (non-GAAP), general and administrative expenses accounted for 7% of the net revenues, decreased slightly from 8% in 2006.

Income from operations for the fourth quarter of 2007 was RMB127 million (US$17 million), increased 69% from the same period in 2006 and 14% from the previous quarter. Excluding share-based compensation charges (non-GAAP), income from operations was RMB149 million (US$20 million), increased 68% from the same period in 2006 and 12% from the pervious quarter.

For the full year ended December 31, 2007, income from operations was RMB404 million (US$55 million), increased 58% from 2006. Excluding share-based compensation charges (non-GAAP), income from operations was RMB491 million (US$67 million), increased 59% from 2006.

Operating margin was 36% in the fourth quarter of 2007, compared to 33% in the fourth quarter of 2006 and 34% in the previous quarter. Excluding share-based compensation charges (non-GAAP), operating margin was 42% compared to 39% in the fourth quarter of 2006 and 41% in the previous quarter.

For the full year ended December 31, 2007, operating margin was 34%, compared to 33% in 2006. Excluding share-based compensation charges (non-GAAP), operating margin was 41% compared to 40% in 2006.

Net income for the fourth quarter of 2007 was RMB135 million (US$19 million), representing a 102% increase from the same period in 2006, and a 24% increase from the previous quarter. Excluding share-based compensation charges (non-GAAP), net income was RMB158 million (US$22 million), representing a 95% increase from the same period in 2006, and a 19% increase from the previous quarter.

For the full year ended December 31, 2007, net income was RMB398 million (US$55 million), representing a 66% increase from 2006. Excluding share-based compensation charges (non-GAAP), net income was RMB485 million (US$67 million), representing a 64% increase from 2006.

Effective tax rate for the fourth quarter of 2007 was 7%, decreased from 14% in the same period of 2006 and 15% in the previous quarter, primarily due to a preferential tax rate granted in the fourth quarter of 2007 and an increase in deferred tax benefit resulting from the application of the tax rate of 25% under the new PRC enterprise income tax law (the “new EIT law”) as of December 31, 2007, as required by applicable accounting guidelines.

Effective tax rate for the full year ended December 31, 2007 was 13%, compared to 15% in 2006, primarily due to an increase in deferred tax benefit resulting from the application of the tax rate of 25% under the new EIT law as of December 31, 2007, as required by applicable accounting guidelines.

 

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The diluted earnings per ADS were RMB1.96 (US$0.27) for the fourth quarter of 2007. Excluding share-based compensation charges (non-GAAP), the diluted earnings per ADS were RMB2.28 (US$0.31).

For the full year ended December 31, 2007, the diluted earnings per ADS were RMB5.84 (US$0.80). Excluding share-based compensation charges (non-GAAP), the diluted earnings per ADS were RMB7.11 (US$0.97), compared to RMB4.44 (US$0.57) in 2006.

As of December 31, 2007, the cash balance was RMB1.1 billion (US$147 million), compared to RMB851 million as of December 31, 2006.

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