Press Releases

Tuniu Announces Unaudited First Quarter 2020 Financial Results

NANJING, China, June 10, 2020 /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, 2020.

Mr. Donald Dunde Yu, Tuniu's founder, Chairman and Chief Executive Officer, said, "Even though travel restrictions implemented during the COVID-19 pandemic remain in place, we are positive on the long-term prospect as there has been a strong accumulation of demand for travel products. By leveraging our experience in Tuniu-branded products and established network of local tour operators, we will shift our focus on the domestic market to offer high-quality domestic travel products to customers, in order to meet the near-term challenges. We are also utilizing new forms of distributions such as live-streaming and social marketing to stimulate customer interest in various destinations and travel products. Lastly, we remain committed to minimizing our expenditures and optimizing our cash flows in preparation for the full recovery of China's leisure travel market."

First Quarter 2020 Results

Net revenues were RMB174.0 million (US$24.6 million[1]) in the first quarter of 2020, representing a year-over-year decrease of 61.9% from the corresponding period in 2019. The decrease was primarily due to the negative impact brought out by the outbreak and spread of COVID-19.

  • Revenues from packaged tours were RMB120.2 million (US$17.0 million) in the first quarter of 2020, representing a year-over-year decrease of 67.1% from the corresponding period in 2019. The decrease was primarily due to the suspension of sale of packaged tours impacted by the outbreak and spread of COVID-19[2].
  • Other revenues were RMB53.7 million (US$7.6 million) in the first quarter of 2020, representing a year-over-year decrease of 40.9% from the corresponding period in 2019. The decrease was primarily due to the declines in service fees received from insurance companies and revenues generated from financial services.

Cost of revenues was RMB81.5 million (US$11.5 million) in the first quarter of 2020, representing a year-over-year decrease of 60.5% from the corresponding period in 2019. As a percentage of net revenues, cost of revenues was 46.8% in the first quarter of 2020, compared to 45.1% in the corresponding period in 2019.

Gross margin was 53.2% in the first quarter of 2020, compare to a gross margin of 54.9% in the first quarter of 2019.

Operating expenses were RMB308.0 million (US$43.5 million) in the first quarter of 2020, representing a year-over-year decrease of 28.6% from the corresponding period in 2019. Share-based compensation expenses, amortization of acquired intangible assets and impairment of acquired intangible assets, which were allocated to operating expenses, were RMB37.6 million (US$5.3 million) in the first quarter of 2020. Non-GAAP[3] operating expenses, which excluded share-based compensation expenses, amortization of acquired intangible assets and impairment of acquired intangible assets, were RMB270.4 million (US$38.2 million) in the first quarter of 2020, representing a year-over-year decrease of 27.8%.

  • Research and product development expenses were RMB51.0 million (US$7.2 million) in the first quarter of 2020, representing a year-over-year decrease of 36.2%. Non-GAAP research and product development expenses, which excluded share-based compensation expenses and amortization of acquired intangible assets of RMB3.1 million (US$0.4 million), were RMB48.0 million (US$6.8 million) in the first quarter of 2020, representing a year-over-year decrease of 35.6% from the corresponding period in 2019. The decrease was primarily due to the decrease in research and product development personnel related expenses.
  • Sales and marketing expenses were RMB124.7 million (US$17.6 million) in the first quarter of 2020, representing a year-over-year decrease of 43.0%. Non-GAAP sales and marketing expenses, which excluded share-based compensation expenses, amortization of acquired intangible assets and impairment of acquired intangible assets of RMB31.8 million (US$4.5 million), were RMB92.9 million (US$13.1 million) in the first quarter of 2020, representing a year-over-year decrease of 49.3% from the corresponding period in 2019. The decrease was primarily due to the decrease in promotion expenses and sales and marketing personnel related expenses.
  • General and administrative expenses were RMB133.9 million (US$18.9 million) in the first quarter of 2020, representing a year-over-year decrease of 0.9%. The decrease was primarily due to the decrease in general and administrative personnel related expenses. Non-GAAP general and administrative expenses, which excluded share-based compensation expenses and amortization of acquired intangible assets of RMB2.7 million (US$0.4 million), were RMB131.1 million (US$18.5 million) in the first quarter of 2020, representing a year-over-year increase of 9.7% from the corresponding period in 2019. The increase was primarily due to the increase in allowance for doubtful accounts.

[1] The conversion of Renminbi ("RMB") into United States dollars ("US$") is based on the exchange rate of US$1.00=RMB7.0808 on March 31, 2020 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] On January 24, 2020, the Ministry of Culture and Tourism of the People's Republic of China issued a notice requiring travel agencies, including online travel agencies throughout the country to suspend the operation of organized tours and the provision of a combination of flight and hotel bookings.

[3] 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.

Loss from operations was RMB215.5 million (US$30.4 million) in the first quarter of 2020, compared to a loss from operations of RMB180.5 million in the first quarter of 2019. Non-GAAP loss from operations, which excluded share-based compensation expenses, amortization of acquired intangible assets and impairment of acquired intangible assets, was RMB177.7 million (US$25.1 million) in the first quarter of 2020.

Net loss was RMB205.2 million (US$29.0 million) in the first quarter of 2020, compared to a net loss of RMB148.2 million in the first quarter of 2019. Non-GAAP net loss, which excluded share-based compensation expenses, amortization of acquired intangible assets and impairment of acquired intangible assets, was RMB167.4 million (US$23.6 million) in the first quarter of 2020.

Net loss attributable to ordinary shareholders was RMB201.5 million (US$28.5 million) in the first quarter of 2020, compared to a net loss attributable to ordinary shareholders of RMB150.6 million in the first quarter of 2019. Non-GAAP net loss attributable to ordinary shareholders, which excluded share-based compensation expenses, amortization of acquired intangible assets and impairment of acquired intangible assets, was RMB163.7 million (US$23.1 million) in the first quarter of 2020.

As of March 31, 2020, the Company had cash and cash equivalents, restricted cash and short-term investments of RMB2.1 billion (US$296.6 million). The COVID-19 pandemic has negatively impacted our business operation and cash flows for the first quarter of 2020, which could continue to impact on subsequent periods. Based on our liquidity assessment and management actions, we believe that our available cash, cash equivalents and cash generated from future operations and maturity of investments will be sufficient to meet our working capital requirements and capital expenditures in the ordinary course of business for the foreseeable future.

Business Outlook

Tuniu's business has been significantly and negatively impacted by the outbreak and spread of COVID-19 since January 2020. As a result of the continued influence by COVID-19, for the second quarter of 2020, the Company expects to generate RMB20.8 million to RMB72.8 million of net revenues, which represents 86% to 96% 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 June 10, 2020, (8:00 pm, Beijing/Hong Kong Time, on June 10, 2020) to discuss the first quarter 2020 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 1Q 2020 Earnings Call

A telephone replay will be available one hour after the end of the conference through June 17, 2020. The dial-in details are as follows:

US:        

+1-877-344-7529

International: 

+1-412-317-0088

Replay Access Code:

10144584

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 a dedicated team of professional customer service representatives, 24/7 call centers, extensive networks of offline retail stores and 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; the impact of the COVID-19 on Tuniu's business operations, the travel industry and the economy of China and elsewhere generally; 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, other operating income, total 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-basic and diluted, which excludes share-based compensation expenses, amortization of acquired intangible assets and impairment 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, amortization of acquired intangible assets and impairment of acquired intangible assets is that share-based compensation expenses, amortization of acquired intangible assets and impairment 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, 2019 


 March 31, 2020 


 March 31, 2020 


 RMB 


 RMB 


 US$ 







ASSETS






Current assets






   Cash and cash equivalents

295,463


590,948


83,458

   Restricted cash 

327,052


111,754


15,783

   Short-term investments

1,305,386


1,397,273


197,333

   Accounts receivable, net

529,983


450,756


63,659

   Amounts due from related parties

65,108


62,727


8,859

   Prepayments and other current assets  

1,300,284


951,691


134,404

Total current assets

3,823,276


3,565,149


503,496







Non-current assets






   Long-term investments

1,305,612


786,646


111,096

   Property and equipment, net

223,340


210,132


29,676

   Intangible assets, net

166,267


130,618


18,447

   Land use right, net

98,774


98,259


13,877

   Operating lease right-of-use assets, net

105,839


87,515


12,359

   Goodwill

232,007


232,007


32,766

   Other non-current assets

83,923


70,856


10,007

   Long-term amounts due from related parties

557,582


554,179


78,265

Total non-current assets

2,773,344


2,170,212


306,493

Total assets

6,596,620


5,735,361


809,989







LIABILITIES AND SHAREHOLDERS' EQUITY






Current liabilities






   Short-term borrowings

203,845


203,672


28,764

   Accounts and notes payable 

1,311,963


1,129,995


159,586

   Amounts due to related parties

29,755


26,594


3,756

   Salary and welfare payable

112,511


75,721


10,694

   Taxes payable

12,207


4,230


597

   Advances from customers

1,113,879


492,277


69,523

   Operating lease liabilities, current

57,490


57,167


8,074

   Accrued expenses and other current liabilities

907,119


1,118,539


157,968

Total current liabilities

3,748,769


3,108,195


438,962







Non-current liabilities






   Operating lease liabilities, non-current

54,718


45,541


6,432

   Deferred tax liabilities

23,658


22,829


3,224

   Long-term borrowings

9,689


10,941


1,545

   Other non-current liabilities

10,947


10,947


1,546

Total non-current liabilities

99,012


90,258


12,747

Total liabilities

3,847,781


3,198,453


451,709







Mezzanine equity






Redeemable noncontrolling interests

37,200


37,200


5,254







Shareholders' equity






   Ordinary shares

249


249


35

   Less: Treasury stock

(310,942)


(310,724)


(43,883)

   Additional paid-in capital

9,113,512


9,117,787


1,287,678

   Accumulated other comprehensive income

293,784


301,875


42,633

   Accumulated deficit*

(6,385,974)


(6,606,860)


(933,067)

Total Tuniu's shareholders' equity

2,710,629


2,502,327


353,396

Noncontrolling interests

1,010


(2,619)


(370)

Total Shareholders' equity

2,711,639


2,499,708


353,026

Total liabilities and shareholders' equity

6,596,620


5,735,361


809,989













*On 1 January 2020, the Company adopted ASU No. 2016-13 (ASU 2016-13), "Financial Instruments – Credit Losses", and recognized a
cumulative-effect adjustment to the opening retained earnings at the adoption date.

 

 

 

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, 2019 


 December 31, 2019 


 March 31, 2020 


 March 31, 2020 






 RMB 


 RMB 


 RMB 


 US$ 

















Revenues












   Packaged tours

365,893


344,325


120,240


16,981





   Others

90,964


106,958


53,741


7,590





Net revenues

456,857


451,283


173,981


24,571





Cost of revenues

(206,019)


(234,623)


(81,460)


(11,504)





Gross profit

250,838


216,660


92,521


13,067

















Operating expenses












   Research and product development

(80,016)


(79,038)


(51,026)


(7,206)





   Sales and marketing

(218,820)


(239,898)


(124,698)


(17,611)





   General and administrative

(135,072)


(341,487)


(133,860)


(18,905)





   Other operating income

2,543


9,545


1,574


222





Total operating expenses

(431,365)


(650,878)


(308,010)


(43,500)





Loss from operations

(180,527)


(434,218)


(215,489)


(30,433)





Other income/(expenses)












   Interest and investment income, net

38,671


38,766


21,852


3,086





   Interest expense

(6,810)


(11,372)


(10,499)


(1,483)





   Foreign exchange (losses)/gains, net

(303)


3,272


(877)


(124)





   Other income/(loss), net

268


2,808


(1,718)


(243)





Loss before income tax expense

(148,701)


(400,744)


(206,731)


(29,197)





Income tax benefit/(expense)

525


(2,910)


817


115





Equity in income of affiliates

-


2,223


744


105





Net loss

(148,176)


(401,431)


(205,170)


(28,977)





Net income/(loss) attributable to noncontrolling interests

1,169


(35,957)


(3,629)


(513)





Net income/(loss) attributable to redeemable noncontrolling
interests

714


123


(81)


(11)





Net loss attributable to Tuniu Corporation

(150,059)


(365,597)


(201,460)


(28,453)





Accretion on redeemable noncontrolling interests

(543)


(1,540)


(81)


(11)





Net loss attributable to ordinary shareholders

(150,602)


(367,137)


(201,541)


(28,464)

















Net loss

(148,176)


(401,431)


(205,170)


(28,977)





Other comprehensive (loss)/income:












   Foreign currency translation adjustment, net of nil tax

(4,742)


(4,939)


8,091


1,143





Comprehensive loss

(152,918)


(406,370)


(197,079)


(27,834)

















Net loss per ordinary share attributable to ordinary
shareholders - basic and diluted

(0.41)


(0.99)


(0.54)


(0.08)





Net loss per ADS - basic and diluted*

(1.23)


(2.97)


(1.62)


(0.24)

















Weighted average number of ordinary shares used in computing basic and diluted loss per share

369,190,766


369,797,249


370,055,731


370,055,731

















Share-based compensation expenses included are as follows:












   Cost of revenues

1,869


258


207


29





   Research and product development

5,041


839


2,136


302





   Sales and marketing

1,416


267


205


29





   General and administrative

14,835


5,500


2,025


286





Total

23,161


6,864


4,573


646

















*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, 2020


 GAAP  


 Share-based 


Amortization of acquired 


Impairment of acquired


 Non-GAAP 


 Result 


 Compensation 


  intangible assets 


  intangible assets 


 Result 











Cost of revenues

(81,460)


207


-


-


(81,253)











Research and product development

(51,026)


2,136


933


-


(47,957)

Sales and marketing

(124,698)


205


22,050


9,554


(92,889)

General and administrative

(133,860)


2,025


709


-


(131,126)

Other operating income

1,574


-


-


-


1,574

Total operating expenses

(308,010)


4,366


23,692


9,554


(270,398)











Loss from operations

(215,489)


4,573


23,692


9,554


(177,670)











Net loss

(205,170)


4,573


23,692


9,554


(167,351)











Net loss attributable to ordinary shareholders

(201,541)


4,573


23,692


9,554


(163,722)











Net loss per ordinary share attributable to ordinary
shareholders - basic and diluted

(0.54)








(0.44)

Net loss per ADS - basic and diluted

(1.62)








(1.32)











Weighted average number of ordinary shares used
in computing basic and diluted loss per share

370,055,731








370,055,731






















 Quarter Ended December 31, 2019


 GAAP  


 Share-based 


Amortization of acquired 


Impairment of acquired


 Non-GAAP 


 Result 


 Compensation 


  intangible assets 


  intangible assets 


 Result 











Cost of revenues

(234,623)


258


-


-


(234,365)











Research and product development

(79,038)


839


793


-


(77,406)

Sales and marketing

(239,898)


267


34,649


32,014


(172,968)

General and administrative

(341,487)


5,500


705


-


(335,282)

Other operating income

9,545


-


-


-


9,545

Total operating expenses

(650,878)


6,606


36,147


32,014


(576,111)











Loss from operations

(434,218)


6,864


36,147


32,014


(359,193)











Net Loss

(401,431)


6,864


36,147


32,014


(326,406)











Net loss attributable to ordinary shareholders

(367,137)


6,864


36,147


32,014


(292,112)











Net loss per ordinary share attributable to ordinary
shareholders - basic and diluted

(0.99)








(0.79)

Net loss per ADS - basic and diluted

(2.97)








(2.37)











Weighted average number of ordinary shares
used in computing basic and diluted loss per
share

369,797,249








369,797,249






















 Quarter Ended March 31, 2019


 GAAP  


 Share-based 


Amortization of acquired 


Impairment of acquired


 Non-GAAP 


 Result 


 Compensation 


  intangible assets 


  intangible assets 


 Result 











Cost of revenues

(206,019)


1,869


-


-


(204,150)











Research and product development

(80,016)


5,041


513


-


(74,462)

Sales and marketing

(218,820)


1,416


34,163


-


(183,241)

General and administrative

(135,072)


14,835


703


-


(119,534)

Other operating income

2,543


-


-


-


2,543

Total operating expenses

(431,365)


21,292


35,379


-


(374,694)











Loss from operations

(180,527)


23,161


35,379


-


(121,987)











Net loss

(148,176)


23,161


35,379


-


(89,636)











Net loss attributable to ordinary shareholders

(150,602)


23,161


35,379


-


(92,062)











Net loss per ordinary share attributable to ordinary
shareholders - basic and diluted

(0.41)








(0.25)

Net loss per ADS - basic and diluted

(1.23)








(0.75)











Weighted average number of ordinary shares used
in computing basic and diluted loss per share

369,190,766








369,190,766





















*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.

 

 

SOURCE Tuniu