BEIJING, April 30, 2015 /PRNewswire/ -- eLong, Inc.
(Nasdaq: LONG), a leading mobile and online travel service provider
in China, today reported unaudited
financial results for the first quarter ended March 31, 2015.
Highlights
- Accommodation reservation* room nights stayed in the
first quarter increased 34% to 9.3 million room nights
compared to 7.0 million in the prior year period.
- Mobile bookings comprised more than 65% of eLong brand
room nights** in the first quarter, and cumulative downloads of
eLong mobile apps reached approximately 200 million.
- Domestic hotel coverage network expanded 180% to over
280,000 domestic hotels as of March 31,
2015, compared to 100,000 as of March
31, 2014.
- More than 35,000 properties have contracted to use the
free, cloud-based, multi-device hotel property management systems,
Yunzhanggui and Zhuzhe, produced by our investee companies.
"Our lodging network has grown to more than 280,000 properties
in China and approximately 510,000
properties worldwide. Facing fierce competition, we are innovating
more quickly and investing more in our products, technology and
marketing than at any time in our history. We will continue to
invest in order to continue to accelerate our room night growth in
the remainder of 2015," said Guangfu
Cui, Chief Executive Officer of eLong.
* "Accommodation
reservation" mainly represents the reservation of hotels,
guesthouses, apartments and other accommodation-related services.
In our previous press releases, we have used "hotel reservation"
when referring to this same operational matrix. We believe that
"accommodation" better describes the diversified lodging and
accommodation services that we offer.
|
|
** "eLong brand room
nights" excludes room nights from non-eLong brand distribution
partners and resellers.
|
Business Results
Total Revenues
Total revenues by product for the first quarter of 2015 as
compared to the same period in 2014 were as follows (in RMB
million):
|
|
Q1
2015
|
|
%
|
|
Q1
2014
|
|
%
|
|
Y/Y
|
Total
|
Total
|
Growth
|
Accommodation
reservation
|
|
190.3
|
|
84%
|
|
204.8
|
|
78%
|
|
(7%)
|
Transportation
ticketing***
|
|
25.1
|
|
11%
|
|
40.0
|
|
15%
|
|
(37%)
|
Other
|
|
10.4
|
|
5%
|
|
17.9
|
|
7%
|
|
(42%)
|
Total
revenues
|
|
225.8
|
|
100%
|
|
262.7
|
|
100%
|
|
(14%)
|
|
*** "Transportation
ticketing" mainly represents the reservation of air tickets, train
tickets, travel insurances, and other transportation-related
services. In view of the diversified transportation-related
services that we offer today, beginning with this press release, we
report our revenues generated from the reservation of air tickets,
train tickets, travel insurance (the revenues of which were
previously reported as "Other" revenues) and other
transportation-related services under "transportation ticketing"
revenues. We also intend to no longer report "air ticketing"
revenues separately from revenues from train tickets, travel
insurances, and other transportation-related services in our
consolidated statements of comprehensive income/(loss).
|
Net Revenues
Net revenues for the first quarter decreased 14% to RMB211.9 million (US$34.2
million), compared to RMB246.1
million (US$39.6 million) in
the first quarter of 2014.
Accommodation Reservation
Accommodation reservation revenues decreased 7% in the first
quarter of 2015 compared to the same period in 2014, primarily due
to lower revenue per room night, partially offset by higher volume.
Room nights stayed in the first quarter increased 34% year-on-year
to 9.3 million, and revenue per room night decreased due to the
lower commission rate room nights for which we recognize revenues
on a net basis, the growth of our aggressive coupon program, and
significant direct discounts in our merchant hotel business,
partially offset by the growth of hotel room night transactions for
which we take inventory risk and recognize revenues on a gross
basis. Accommodation reservation revenues comprised 84% of total
revenues, compared to 78% in the prior year quarter.
Transportation Ticketing
Transportation tickets increased to 1.6 million in the first
quarter, an increase of 95% compared to the prior year period,
primarily due to the growth of train tickets. Transportation
ticketing revenues decreased 37% in the first quarter, primarily
due to a decrease in air commission revenue per ticket. The decline
in air commission revenue per ticket was primarily due to the
lowering by major Chinese airlines of the base air commission rate
from 3% to 2% in July 2014 and
subsequently from 2% to 1% in February
2015. Transportation ticketing revenue decreased to 11% of
our total revenues from 15% in the prior year quarter.
Other
Other revenues are primarily derived from advertising business.
Other revenue decreased 42% year-on-year in the first quarter of
2015, mainly driven by decreased advertising revenue as a result of
our disposition of Nanjing Xici Information Technology Share Co.,
Ltd. ("Nanjing Xici") in the first quarter of 2015. Other revenue
decreased to 5% of total revenues in the first quarter from 7% in
the prior year quarter.
Gross Margin
Gross margin in the first quarter of 2015 decreased to 29% from
73% in the prior year quarter.The decline in gross margin in the
first quarter of 2015 was primarily due to lower revenue per room
night and the growth of hotel room night transactions for which we
take inventory risk and recognize revenue on a gross basis.
Operating Expenses
Operating expenses for the first quarter of 2015 as compared to
the same period in 2014 were as follows (in RMB
million):
|
|
Q1
2015
|
|
% of Net
Revenue
|
|
Q1
2014
|
|
% of Net
Revenue
|
|
Y/Y
Growth
|
Service
development
|
|
92.7
|
|
44%
|
|
55.1
|
|
22%
|
|
68%
|
Sales and
marketing
|
|
167.2
|
|
79%
|
|
136.1
|
|
55%
|
|
23%
|
General and
administrative
|
|
48.4
|
|
23%
|
|
33.3
|
|
14%
|
|
45%
|
Amortization of
intangible assets
|
|
5.3
|
|
3%
|
|
1.7
|
|
1%
|
|
208%
|
Total operating
expenses
|
|
313.6
|
|
149%
|
|
226.2
|
|
92%
|
|
39%
|
Total operating expenses increased 39% for the first quarter of
2015, compared to the prior year period. Operating expenses were
149% of net revenues in the first quarter of 2015, compared to 92%
in the prior year quarter. Operating loss was RMB252.3 million in the first quarter of 2015,
compared to operating loss of RMB46.9
million in the prior year quarter.
Service development expenses are expenses related to technology
and our product offerings, including our mobile applications and
websites, as well as our supplier relations function. In the first
quarter of 2015, service development expenses increased 68%,
primarily due to increased headcount. Service development expenses
increased to 44% of net revenues in the first quarter of 2015,
compared to 22% in the first quarter of 2014.
Sales and marketing expenses for the first quarter of 2015
increased 23% over the prior year quarter, driven by increased
mobile and online marketing expenses. Sales and marketing expenses
increased to 79% of net revenues in the first quarter of 2015 from
55% in the first quarter of 2014.
General and administrative expenses for the first quarter of
2015 increased 45% compared to the prior year quarter, driven by
higher share-based compensation charges and increased professional
fees. General and administrative expenses increased to 23% of net
revenues in the first quarter of 2015 from 14% in the first quarter
of 2014.
Other income was RMB86.3 million
in the first quarter of 2015 compared to other income of
RMB18.3 million in the first quarter
of 2014, primarily due to a gain of RMB71.8
million from our disposition of Nanjing Xici in the first
quarter of 2015.
Income tax expense for the first quarter of 2015 was
RMB16.9 million, compared to income
tax expense of RMB7.7 million during
the prior year quarter, mainly due to income tax expense of
RMB17.9 million on the gain from our
disposition of Nanjing Xici in the first quarter of 2015.
Net loss for the first quarter of 2015 was RMB180.7 million, compared to net loss of
RMB35.4 million during the prior year
quarter.
Basic net loss per ADS and diluted net loss per ADS for the
first quarter of 2015 were each RMB5.02 (US$0.82),
compared to basic net loss per ADS and diluted net loss per ADS of
RMB1.00 (US$0.16) in the prior year quarter.
As of March 31, 2015, eLong held
cash and cash equivalents, short-term investments and restricted
cash of RMB1.7 billion (US$279 million), of which 90% was held in
Renminbi and 10% was held in US dollars.
Safe Harbor Statement
Statements in this press release concerning eLong's future
business, operating results and financial condition are
"forward-looking" statements within the meaning of Section 27A of
the Securities Act of 1933, as amended, Section 21E of the
Securities Exchange Act of 1934, as amended, and as defined in the
Private Securities Litigation Reform Act of 1995. Words such as
"anticipate," "believe," "estimate," "expect," "forecast,"
"intend," "may," "plan," "project," "predict," "future," "is/are
likely to," "should" and "will" and similar expressions as they
relate to eLong are intended to identify such forward-looking
statements, but are not the exclusive means of doing so. These
forward-looking statements are based upon management's current
views and expectations with respect to future events and are not a
guarantee of future performance. Forward-looking statements
include, but are not limited to, statements about our anticipated
growth strategies, our future business development, results of
operations and financial condition, our ability to control costs,
limit losses and/or return to profitability, our ability to attract
customers and leverage our brand, and trends and competition in the
travel industry in China and
globally. Furthermore, these statements are, by their nature,
subject to a number of risks and uncertainties that could cause our
actual performance and results to differ materially from those
discussed in the forward-looking statements. Factors that could
affect our actual results and cause our actual results to differ
materially from those referred to in any forward-looking statement
include, but are not limited to, declines or disruptions in the
travel industry, international financial, political or economic
crises, a slowdown in the PRC economy, an outbreak of bird flu or
other disease, eLong's reliance on maintaining good relationships
with, and stable air and hotel inventory from, hotel suppliers and
airline ticket suppliers, and on establishing new relationships
with suppliers on similar terms, our reliance on the TravelSky GDS
system for our air business, Baidu (and its subsidiary Qunar) and
Qihoo for our search engine marketing, our reliance on maintaining
commercial cooperation with hotel distribution partners, the risk
that eLong will not be able to increase its brand recognition, the
possibility that eLong will be unable to continue timely compliance
with the Sarbanes-Oxley Act or other regulatory requirements, the
risk that eLong will not be successful in competing against new and
existing competitors, the risk that our infrastructure and
technology are damaged, fail or become obsolete, risks associated
with Expedia, Inc.'s (Nasdaq: EXPE) majority ownership interest and
Tencent's shareholding in eLong, risks relating to eLong's
investments in, and acquisitions of, other businesses and assets,
fluctuations in the value of the Renminbi, inflation in
China, changes in eLong's
management team and other personnel, risks relating to
uncertainties in the PRC legal system, including risks relating to
our affiliated Chinese operating entities, risks and uncertainties
relating to litigation and arbitration in China, risks relating to the application of
preferential tax policies, the risk that eLong will continue to
incur substantial losses, and other risks mentioned in eLong's
filings with the U.S. Securities and Exchange Commission, including
eLong's Annual Report on Form 20-F.
If one or more of these risks or uncertainties occur, or if our
underlying assumptions prove to be incorrect, actual events or
results may vary significantly from those implied or projected by
the forward looking-statements. Investors should not rely upon
forward-looking statements as predictions of future events. Except
as required by law, we undertake no obligation to update or revise
publicly any forward-looking statements, whether as a result of new
information, future events or otherwise. All forward-looking
statements contained in this press release are qualified by
reference to this cautionary statement.
Conference Call
eLong will host a conference call to discuss its first quarter
2015 unaudited financial results on May 1,
2015 at 9:00 am Beijing time (April 30,
2015, 9:00 pm ET). The dial-in
number is +1-866-297-1588 for U.S. participants; +852-3001-3842 for
Hong Kong participants; and
86-400-810-4761 for participants in mainland China. International participants can dial
+1-210-795-1143. Participant pass code: 5050672. An archived
web cast of this call will be available for one year on the
Investor Relations section of the eLong web site at
http://elong.investorroom.com/.
About eLong, Inc.
eLong, Inc. (Nasdaq: LONG - News) is a leader in mobile and
online accomodations reservations in China offering consumers a network of
approximately 510,000 properties worldwide. eLong technology
enables travelers to book hotels, guesthouses, apartments and other
accommodations, as well as air and train tickets, through
convenient mobile and tablet applications (m.eLong.com), websites
(www.eLong.com), 24 hour customer service, and easy to use tools
such as destination guides, maps and user reviews. eLong's largest
shareholders are Expedia, Inc. (Nasdaq: EXPE) and Tencent Holdings Ltd. (HKSE: 0700).
For further information, please contact:
eLong, Inc.
Investor Relations
ir@corp.elong.com
+86-10-6436-7570
eLong,
Inc.
|
|
CONSOLIDATED
STATEMENTS OF COMPREHENSIVE LOSS
|
|
(IN THOUSANDS
EXCEPT PER SHARE AND PER ADS AMOUNTS)
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
Mar. 31,
2014
|
Dec. 31,
2014
|
Mar. 31,
2015
|
Mar. 31,
2015
|
|
|
|
RMB
|
RMB
|
RMB
|
USD(1)
|
|
|
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
|
Revenues:
|
|
|
|
|
|
|
Accommodation
reservation*
|
|
204,841
|
210,060
|
190,251
|
30,691
|
|
Transportation
ticketing**
|
|
40,021
|
33,541
|
25,078
|
4,045
|
|
Other
|
|
17,842
|
21,816
|
10,427
|
1,682
|
|
Total
revenues
|
|
262,704
|
265,417
|
225,756
|
36,418
|
|
Business tax, VAT and
surcharges
|
|
(16,581)
|
(19,242)
|
(13,833)
|
(2,231)
|
|
Net
revenues
|
|
246,123
|
246,175
|
211,923
|
34,187
|
|
Cost of
services
|
|
(66,822)
|
(123,423)
|
(150,663)
|
(24,305)
|
|
Gross
profit
|
|
179,301
|
122,752
|
61,260
|
9,882
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
Service
development
|
|
(55,070)
|
(83,986)
|
(92,656)
|
(14,947)
|
|
Sales and
marketing
|
|
(136,093)
|
(180,371)
|
(167,220)
|
(26,976)
|
|
General and
administrative
|
|
(33,329)
|
(40,278)
|
(48,354)
|
(7,800)
|
|
Amortization of
intangible assets
|
|
(1,735)
|
(4,002)
|
(5,339)
|
(861)
|
|
Impairment of
goodwill
|
|
-
|
(5,496)
|
-
|
-
|
|
Total operating
expenses
|
|
(226,227)
|
(314,133)
|
(313,569)
|
(50,584)
|
|
Loss from
operations
|
|
(46,926)
|
(191,381)
|
(252,309)
|
(40,702)
|
|
|
|
|
|
|
|
|
Other
income/(expense):
|
|
|
|
|
|
|
Interest
income
|
|
15,768
|
14,932
|
14,050
|
2,266
|
|
Government
subsidy
|
|
2,819
|
2,074
|
1,339
|
216
|
|
Foreign exchange
losses
|
|
(931)
|
(812)
|
(1,364)
|
(220)
|
|
Net loss on equity
method investments
|
|
-
|
(18,035)
|
-
|
-
|
|
Gain from disposition
of subsidiary
|
|
-
|
-
|
71,762
|
11,577
|
|
Other
|
|
656
|
299
|
509
|
82
|
|
Total other
income/(expense)
|
|
18,312
|
(1,542)
|
86,296
|
13,921
|
|
Loss before income
tax expense
|
(28,614)
|
(192,923)
|
(166,013)
|
(26,781)
|
|
Income tax
expense
|
|
(7,702)
|
(16,537)
|
(16,882)
|
(2,722)
|
|
Share of net loss in
non-consolidated affiliates
|
|
(49)
|
(362)
|
(598)
|
(97)
|
|
Net
loss
|
|
(36,365)
|
(209,822)
|
(183,493)
|
(29,600)
|
|
Net loss attributable
to noncontrolling interests
|
|
996
|
3,091
|
2,786
|
449
|
|
Net loss
attributable to eLong, Inc.
|
|
(35,369)
|
(206,731)
|
(180,707)
|
(29,151)
|
|
Other comprehensive
income
|
|
-
|
-
|
-
|
-
|
|
Total comprehensive
loss
|
|
(35,369)
|
(206,731)
|
(180,707)
|
(29,151)
|
|
|
|
|
|
|
|
|
Basic net loss per
share
|
|
(0.50)
|
(2.89)
|
(2.51)
|
(0.41)
|
|
Diluted net loss
per share
|
|
(0.50)
|
(2.89)
|
(2.51)
|
(0.41)
|
|
|
|
|
|
|
|
|
Basic net loss per
ADS(2)(3)
|
|
(1.00)
|
(5.78)
|
(5.02)
|
(0.82)
|
|
Diluted net loss
per ADS(2)(3)
|
|
(1.00)
|
(5.78)
|
(5.02)
|
(0.82)
|
|
|
|
|
|
|
|
|
Shares used in
computing net loss per share:
|
|
|
|
|
|
|
Basic
|
|
70,486
|
71,573
|
71,967
|
71,967
|
|
Diluted
|
|
70,486
|
71,573
|
71,967
|
71,967
|
|
|
|
|
|
|
|
|
Share-based
compensation charges included in:
|
|
28,858
|
5,307
|
27,338
|
4,410
|
|
Cost of services
|
|
836
|
345
|
138
|
22
|
|
Service development
|
|
6,535
|
2,898
|
3,879
|
626
|
|
Sales and marketing
|
|
3,332
|
725
|
(838)
|
(135)
|
|
General and administrative
|
|
18,155
|
1,339
|
24,159
|
3,897
|
|
|
|
|
|
|
|
|
* Accommodation
reservation revenues mainly represent revenues from the reservation
of hotels, guesthouses, apartments
and other accommodation-related services.
|
|
** Transportation
ticketing revenues mainly represent revenues from the reservation
of air tickets, train tickets, travel insurances,
and other transportation-related services.
|
|
Note 1: The
conversion of Renminbi (RMB) into United States dollars (USD) is
based on the noon buying rate of USD1.00=RMB6.1990
on March 31, 2015 in the City of New York for cable transfers of
Renminbi as certified for customs purposes by the Federal
Reserve.
No representation is made that the RMB amounts could have been, or
could be, converted or settled into USD at the rates stated
herein
on the reporting dates, at any other rates or at all.
|
|
|
|
|
Note 2: 1 ADS = 2
shares.
|
|
Note 3: Non-GAAP
financial measures
Note 4: Certain items
in prior periods' consolidated statements of comprehensive loss
have been reclassified to conform to the current
period's presentation in order to facilitate comparison.
|
|
eLong,
Inc.
CONSOLIDATED
BALANCE SHEETS
(IN
THOUSANDS)
|
|
|
|
|
|
|
|
|
|
Dec. 31,
2014
|
|
Mar. 31,
2015
|
|
Mar. 31,
2015
|
|
|
RMB
|
|
RMB
|
|
USD
|
|
|
(Audited)
|
|
(Unaudited)
|
|
(Unaudited)
|
ASSETS
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
504,890
|
|
370,699
|
|
59,800
|
Short-term
investments
|
|
1,306,634
|
|
1,233,064
|
|
198,913
|
Restricted
cash
|
|
123,937
|
|
123,983
|
|
20,000
|
Accounts receivable,
net
|
|
295,632
|
|
291,513
|
|
47,026
|
Amounts due from
related parties
|
|
52,021
|
|
62,695
|
|
10,114
|
Prepaid
expenses
|
|
55,417
|
|
47,412
|
|
7,648
|
Deferred tax assets,
current
|
|
304
|
|
-
|
|
-
|
Advance to
suppliers
|
|
75,285
|
|
100,753
|
|
16,253
|
Other current
assets
|
|
104,923
|
|
158,184
|
|
25,518
|
Total current
assets
|
|
2,519,043
|
|
2,388,303
|
|
385,272
|
Property and
equipment, net
|
|
112,356
|
|
116,873
|
|
18,854
|
Investment in
non-consolidated affiliates
|
|
96,942
|
|
96,343
|
|
15,542
|
Goodwill
|
|
181,322
|
|
184,252
|
|
29,723
|
Intangible assets,
net
|
|
84,749
|
|
81,161
|
|
13,093
|
Deferred tax assets,
non-current
|
|
516
|
|
-
|
|
-
|
Other non-current
assets
|
|
51,123
|
|
61,308
|
|
9,889
|
Total non-current
assets
|
|
527,008
|
|
539,937
|
|
87,101
|
Total
assets
|
|
3,046,051
|
|
2,928,240
|
|
472,373
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
Accounts
payable
|
|
442,489
|
|
588,848
|
|
94,991
|
Income taxes
payable
|
|
13
|
|
16,894
|
|
2,725
|
Amounts due to related
parties
|
|
127,910
|
|
69,835
|
|
11,266
|
Deferred
revenue
|
|
47,544
|
|
68,526
|
|
11,054
|
Advances and deposits
from customers
|
|
121,934
|
|
107,938
|
|
17,412
|
eCoupon program
virtual cash liability
|
|
135,648
|
|
126,788
|
|
20,453
|
Accrued expenses and
other current liabilities
|
|
292,310
|
|
223,226
|
|
36,010
|
Total current
liabilities
|
|
1,167,848
|
|
1,202,055
|
|
193,911
|
Deferred tax
liabilities, non-current
|
|
21,187
|
|
21,187
|
|
3,418
|
Other
liabilities
|
|
44
|
|
3,927
|
|
633
|
Total non-current
liabilities
|
|
21,231
|
|
25,114
|
|
4,051
|
Total
liabilities
|
|
1,189,079
|
|
1,227,169
|
|
197,962
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
|
|
|
|
|
Ordinary
shares
|
|
2,908
|
|
2,921
|
|
471
|
High-vote ordinary
shares
|
|
2,691
|
|
2,691
|
|
434
|
Additional paid-in
capital
|
|
2,397,868
|
|
2,427,910
|
|
391,661
|
Statutory
reserves
|
|
3,665
|
|
3,665
|
|
592
|
Accumulated
deficit
|
|
(626,810)
|
|
(807,863)
|
|
(130,321)
|
Total eLong Inc.
shareholders' equity
|
|
1,780,322
|
|
1,629,324
|
|
262,837
|
Noncontrolling
interest
|
|
76,650
|
|
71,747
|
|
11,574
|
Total shareholders'
equity
|
|
1,856,972
|
|
1,701,071
|
|
274,411
|
Total liabilities
and shareholders' equity
|
|
3,046,051
|
|
2,928,240
|
|
472,373
|
Non-GAAP Financial Measures
To supplement the financial measures calculated in accordance
with generally accepted accounting principles in the United States, or GAAP, this press release
includes certain non-GAAP financial measures including basic net
income/(loss) per ADS, diluted net income/(loss) per ADS, Adjusted
Earnings Before Interests, Taxes, Depreciation and Amortization
("Adjusted EBITDA"), Adjusted Net Income/(Loss) ("ANI") and
Adjusted Net Income/(Loss) Per Share. We believe these non-GAAP
financial measures may help investors understand eLong's current
financial performance and compare business trends among different
reporting periods. These non-GAAP financial measures should be
considered in addition to financial measures presented in
accordance with GAAP, but should not be considered as a substitute
for, or superior to, financial measures presented in accordance
with GAAP. We seek to compensate for the limitations of the
non-GAAP measures presented by also providing the comparable GAAP
measures, GAAP financial statements, and descriptions of the
reconciling items and adjustments, to derive the non-GAAP
measures.
Adjusted EBITDA is defined as net income/(loss) plus (1)
interest expense (income); (2) income tax expense (benefit); (3)
depreciation; (4) amortization of intangible assets; (5)
share-based compensation charges; (6) foreign exchange losses
(gains); (7) acquisition-related impacts, including (i) goodwill
and intangible asset impairment, and (ii) losses (gains) recognized
on non-controlling investment basis adjustments when we acquire
controlling interests; (8) losses (gains) from disposition of
subsidiary; and (9) certain other items, including restructuring
charges, impairment loss on equity method investment and equity in
net loss/(income) of affiliates. We believe Adjusted EBITDA is a
useful financial metric to assess our operating and financial
performance before the impact of investing and financing
transactions, if any, and income tax expense (benefit). Since
share-based compensation charges are non-cash expenses, we believe
excluding them from our calculation of Adjusted EBITDA allows us to
provide investors with a more useful tool for assessing our
operating and financial performance. In addition, we believe that
Adjusted EBITDA is used by other companies and may be used by
investors as a measure of our financial performance. The
presentation of Adjusted EBITDA should not be construed as an
indication that eLong's future results will be unaffected by other
charges and gains we consider to be outside the ordinary course of
our business. The use of Adjusted EBITDA has certain limitations.
Amortization and depreciation expenses for various non-current
assets, share-based compensation charges, other income/(expenses),
and income tax expense (benefit) have been and will be incurred and
are not reflected in the presentation of Adjusted EBITDA. Each of
these items should also be considered in the overall evaluation of
our results. Additionally, Adjusted EBITDA does not consider
capital expenditures and other investing activities and should not
be considered as a measure of eLong's liquidity. We seek to
compensate for these limitations by providing the relevant
disclosure of our amortization and depreciation expenses, and
share-based compensation charges in the reconciliations to the GAAP
financial measure. The term Adjusted EBITDA is not defined under
GAAP, and Adjusted EBITDA is not a measure of net income/(loss),
income/(loss) from operations, operating performance or liquidity
presented in accordance with GAAP. In addition, eLong's Adjusted
EBITDA may not be comparable to Adjusted EBITDA or similarly titled
measures utilized by other companies since such other companies may
not calculate Adjusted EBITDA in the same manner as we do.
Adjusted EBITDA should be considered in addition to results
prepared in accordance with GAAP, but should not be considered a
substitute for, or superior to, GAAP measures. We present a
reconciliation of this non-GAAP financial measure to GAAP
below.
eLong,
Inc.
|
TABULAR
RECONCILIATION FOR NON-GAAP MEASURE
|
Adjusted
EBITDA
|
(IN
THOUSANDS)
|
|
|
|
|
|
|
|
|
2014
(Unaudited)
|
2015
(Unaudited)
|
|
Q1
|
Q2
|
Q3
|
Q4
|
2014
|
Q1
|
|
RMB
|
RMB
|
RMB
|
RMB
|
RMB
|
RMB
|
|
|
|
|
|
|
|
Net income/(loss)
attributable to eLong, Inc.
|
(35,369)
|
31,462
|
(58,306)
|
(206,731)
|
(268,943)
|
(180,707)
|
Net loss attributable
to noncontrolling interests
|
(996)
|
(1,091)
|
(502)
|
(3,091)
|
(5,680)
|
(2,786)
|
Interest
income
|
(15,767)
|
(15,496)
|
(15,139)
|
(14,932)
|
(61,334)
|
(14,050)
|
Government
subsidy
|
(2,819)
|
(8,776)
|
(2,684)
|
(2,074)
|
(16,353)
|
(1,339)
|
Income tax
expense/(benefit)
|
7,702
|
(6,230)
|
(4,915)
|
16,537
|
13,094
|
16,882
|
Depreciation
|
9,123
|
10,064
|
10,665
|
11,500
|
41,352
|
12,817
|
Amortization of
intangible assets
|
1,736
|
1,467
|
1,465
|
4,002
|
8,670
|
5,339
|
Share-based
compensation charges
|
28,858
|
33,633
|
29,877
|
5,307
|
97,675
|
27,338
|
Impairment of
goodwill
|
-
|
-
|
-
|
5,496
|
5,496
|
-
|
Foreign exchange
losses
|
931
|
2,544
|
(207)
|
812
|
4,079
|
1,364
|
Net loss on equity
method investments
|
-
|
-
|
-
|
18,035
|
18,035
|
-
|
Gain from disposition
of subsidiary
|
-
|
-
|
-
|
-
|
-
|
(71,762)
|
Other
|
(510)
|
(539)
|
2,291
|
63
|
1,305
|
89
|
Adjusted
EBITDA
|
(7,111)
|
47,038
|
(37,455)
|
(165,076)
|
(162,604)
|
(206,815)
|
|
|
|
|
|
|
|
|
Adjusted Net Income/(Loss) generally captures all items
on the statements of operations that occur in normal course
operations and have been, or ultimately will be, settled in cash,
and is defined as net income/(loss) plus net of tax: (1)
share-based compensation charges; (2) acquisition-related impacts,
including (i) amortization of intangible assets, including as part
of equity-method investments, and goodwill and intangible asset
impairment, (ii) losses (gains) recognized on changes in the value
of contingent consideration arrangements, and (iii) losses (gains)
recognized on non-controlling investment basis adjustments when we
acquire controlling interests; (3) foreign exchange losses; (4)
losses (gains) from disposition of subsidiary; and (5) certain
other items, including restructuring charges. We believe Adjusted
Net Income/(Loss) is useful to investors because it represents
eLong's results, taking into account depreciation, which management
believes is an ongoing cost of doing business, but excluding the
impact of other non-cash expenses, infrequently occurring items and
items not directly tied to the core operations of our
businesses.
Adjusted Net Income/(Loss) Per Share is defined as
Adjusted Net Income/(Loss) divided by adjusted weighted average
shares outstanding, which includes dilution from options and
warrants per the treasury stock method and includes all shares
relating to Performance Units in shares outstanding for Adjusted
Net Income/(Loss) Per Share. This differs from the GAAP method for
including Performance Units, which treats them on a treasury stock
method basis. Shares outstanding for Adjusted Net Income/(Loss) Per
Share purposes are therefore higher than shares outstanding for
GAAP Net Income/(Loss) Per Share purposes. We believe Adjusted Net
Income/(Loss) Per Share is useful to investors because it
represents, on a per share basis, eLong's consolidated results,
taking into account depreciation, which we believe is an ongoing
cost of doing business, as well as other items which are not
allocated to the operating businesses such as interest income and
income tax expense/(benefit), but excluding the effects of non-cash
expenses not directly tied to the core operations of our
businesses. Adjusted Net Income/(Loss) and Adjusted Net
Income/(Loss) Per Share have similar limitations as Adjusted
EBITDA. In addition, Adjusted Net Income/(Loss) does not include
all items that affect our net income/(loss) and net income/(loss)
per share for the period. Therefore, we think it is important to
evaluate these measures along with our consolidated statements of
operations.
Adjusted Net Income/(Loss) and Adjusted Net Income/(Loss) Per
Share should be considered in addition to results prepared in
accordance with GAAP, but should not be considered a substitute
for, or superior to, GAAP measures. We present a reconciliation of
these non-GAAP financial measures to GAAP below.
eLong,
Inc.
|
|
TABULAR
RECONCILIATION FOR NON-GAAP MEASURE
|
|
Adjusted Net
Income/(Loss) and Adjusted Net Income/(Loss) Per
Share
|
(IN THOUSANDS EXCEPT
PER SHARE AMOUNTS)
|
|
|
|
|
|
|
|
|
|
2014
(Unaudited)
|
2015
(Unaudited)
|
|
|
Q1
|
Q2
|
Q3
|
Q4
|
2014
|
Q1
|
|
|
RMB
|
RMB
|
RMB
|
RMB
|
RMB
|
RMB
|
|
|
|
|
|
|
|
|
|
Net income/(loss)
attributable to eLong, Inc.
|
(35,369)
|
31,462
|
(58,306)
|
(206,731)
|
(268,943)
|
(180,707)
|
|
Net loss attributable
to noncontrolling interests
|
(996)
|
(1,091)
|
(502)
|
(3,091)
|
(5,680)
|
(2,786)
|
|
Share-based
compensation charges
|
28,858
|
33,633
|
29,877
|
5,307
|
97,675
|
27,338
|
|
Impairment of
goodwill
|
-
|
-
|
-
|
5,496
|
5,496
|
-
|
|
Amortization of
intangible assets
|
1,736
|
1,467
|
1,465
|
4,002
|
8,670
|
5,339
|
|
Foreign exchange
losses
|
931
|
2,544
|
(207)
|
812
|
4,079
|
1,364
|
|
Net loss on equity
method investments
|
-
|
-
|
-
|
18,035
|
18,035
|
-
|
|
Gain from disposition
of subsidiary
|
-
|
-
|
-
|
-
|
-
|
(71,762)
|
|
Income tax expense on
gain from disposition of subsidiary
|
-
|
-
|
-
|
-
|
-
|
17,941
|
|
Other
|
(390)
|
(150)
|
809
|
575
|
844
|
(237)
|
|
Adjusted net
income/(loss)
|
(5,230)
|
67,865
|
(26,864)
|
(175,595)
|
(139,824)
|
(203,510)
|
|
|
|
|
|
|
|
|
|
Shares used in
computing adjusted net income/(loss) per share:
|
|
|
|
|
|
|
|
GAAP diluted weighted
average shares outstanding
|
70,486
|
71,392
|
70,943
|
71,573
|
70,918
|
71,967
|
|
Additional
performance units
|
7,428
|
7,423
|
7,409
|
6,410
|
7,171
|
6,056
|
|
Adjusted weighted
average shares outstanding
|
77,914
|
78,815
|
78,352
|
77,983
|
78,089
|
78,023
|
|
|
|
|
|
|
|
|
|
Adjusted net
income/(loss) per share
|
(0.07)
|
0.86
|
(0.34)
|
(2.25)
|
(1.79)
|
(2.61)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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SOURCE eLong, Inc.