Ctrip announced its unaudited financial results for fourth quarter and full year 2017.
Highlights for Fourth Quarter and Full Year 2017
- Net revenue increased 26% to RMB 6.4 billion (USD 980 million) in the fourth quarter, and achieved RMB 26.8 billion (USD 4.1 billion) for full year of 2017, representing 39% growth.
- Gross margin was 83% for the quarter, improving from 78% due to further efficiency gain.
- Operating margin for full year was 11%, compared to -8% in 2016.
International businesses sustained robust momentum.
- Non-China related flight ticket volume for fourth quarter continued to grow rapidly, accounting for 30% of total international tickets.
- Skyscanner's direct booking revenue for fourth quarter nearly doubled compared to the same period of 2016.
- Trip.com, achieved triple-digit growth in air ticketing volume for five consecutive quarters, benefiting from Skyscanner's direct booking initiatives.
Progress in penetrating lower-tier cities.
- Penetration rate in targeted cities increased by over 50% on average in 2017.
- The company opened over 1,000 Ctrip and Qunar branded offline stores in 2017. Total gross merchandise volume, or GMV, of these stores, including 5,000 Traveling Bestone stores, grew over 30% in 2017.
"We had strong results in the fourth quarter, even as we transitioned through short-term challenges in certain areas of our business," said Jane Sun, Chief Executive Officer.
"Guided by the fundamental principles of consistency, transparency, and equality, we will continuously improve our products and services," said James Liang, Executive Chairman.
Fourth Quarter and Full Year Results and Business Updates
For the fourth quarter of 2017, Ctrip reported net revenue of RMB 6.4 billion (USD 980 million), representing a 26% increase from the same period in 2016. Net revenue for the fourth quarter of 2017 decreased 19% from the previous quarter, primarily due to seasonality and product change in domestic air ticketing.
For full year 2017, net revenue was RMB 26.8 billion (USD 4.1 billion), representing a 39% increase from 2016.
Accommodation reservation revenue for the fourth quarter of 2017 was RMB 2.3 billion (USD 356 million), representing a 25% increase from the same period in 2016.
For full year 2017, accommodation reservation revenue was RMB 9.5 billion (USD 1.5 billion), representing a 30% increase from 2016. The accommodation reservation revenue accounted for 35% of the total revenue in 2017 and 37% of the total revenue in 2016.
Transportation ticketing revenue for fourth quarter was RMB 2.9 billion (USD 450 million), representing a 20% increase from the same period in 2016, primarily driven by an increase in ticketing volume and the consolidation of Skyscanner's financial results since December 31, 2016. Transportation ticketing revenue decrease 15% from the previous quarter, primarily due to product change in domestic air ticketing.
For full year 2017, transportation ticketing revenue was RMB 12.2 billion (USD 1.9 billion), representing a 38% increase from 2016. The transportation ticketing revenue accounted for 45% of the total revenue in 2017 and remained consistent with 2016.
Packaged tour revenue for fourth quarter was RMB 623 million (USD 96 million), representing a 34% increase from the same period in 2016. Packaged-tour revenue for the fourth quarter of 2017 decreased 40% from the previous quarter, primarily due to seasonality.
For full year 2017, packaged-tour revenue was RMB 3.0 billion (USD 457 million), representing a 29% increase from 2016. The packaged-tour revenue accounted for 11% of the total revenue in 2017 and 12% of the total revenue in 2016.
Corporate travel revenue for fourth quarter was RMB 207 million (USD 32 million), representing a 15% increase from the same period in 2016. Corporate travel revenue for the fourth quarter of 2017 increased 2% from the previous quarter.
For full year 2017, corporate travel revenue was RMB 753 million (USD 116 million), representing a 24% increase from 2016. The corporate travel revenue accounted for 3% of the total revenue in 2017 and remained consistent with 2016.
Gross margin was 83% for fourth quarter, compared to 78% in the same period in 2016, and remained consistent with the previous quarter. For full year 2017, gross margin was 83%, compared to 75% in 2016.
For full year 2017, sales and marketing expenses increased by 42% to RMB 8.3 billion (USD 1.3 billion) from 2016 and accounted for 31% of net revenue.
Net income attributable to Ctrip's shareholders for fourth quarter was RMB 504 million (USD 77 million), compared to RMB 645 million in the same period in 2016 and RMB 1.2 billion in the previous quarter.
For full year 2017, net income attributable to Ctrip's shareholders was RMB 2.1 billion (USD 329 million), compared to net loss of RMB 1.4 billion in 2016.
As of December 31, 2017, the balance of cash and cash equivalents, restricted cash and short-term investment was RMB 48.1 billion (USD 7.4 billion).
Business Outlook
For first quarter of 2018, the company expects net revenue growth to continue at a year-on-year rate of approximately 9~11%, which is estimated based on Crip's new revenue recognition standard while taking into account the revenue reported for the same period in 2017.
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