Ctrip Reports Exponential Growth; Provides 70-75% Guidance
LONDON, UK / ACCESSWIRE / June 16, 2016 / ActiveWallSt.com announces its post-earnings coverage on Ctrip.com International, Ltd. (NASDAQ: CTRP). The company announced its Q1 2016 earnings result on Wednesday, June 15, 2016. China's largest online travel agency announced that its Q1 FY16 revenue grew 80% on y-o-y basis. The company also forecasted robust earnings and revenue growth for the upcoming quarter. Register with us now for your free membership and see our complete coverage on this equity at:
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Earnings
For the period ending on March 31, 2016, Ctrip reported net loss of RMB 1.6 billion (US$245 million) or 3.49 Yuan per share ($0.54) as compared to net loss of RMB126 million (US$20 million) in the year ago period, this was primarily attributed to the consolidation of Qunar's Cayman Islands Limited (NASDAQ: QUNR) net loss of RMB1.1 billion (US$167 million). The results topped the analyst's consensus estimate of net loss of 3.62 Yuan per share. Earnings, excluding the charges came at RMB257 million (US$40 million) as compared to earnings of RMB33 million (US$5 million) in Q1 FY15.
For Q1 FY16, Ctrip reported net revenues of RMB4.4 billion (US$682 million), an 80% increase on y-o-y basis, primarily due to the consolidation of the financial results of Qunar. Accommodation reservation revenues came at RMB1.6 billion (US$250 million), a 70% growth on y-o-y basis. Transportation ticketing revenues for Q1FY16 surged to RMB1.9 billion (US$302 million), a 106% hike from the year ago period. Packaged-tour revenues were reported at RMB556 million (US$86 million), a 41% rise on y-o-y basis, while Corporate travel revenues increased by 25%.
Growth Opportunities
The booming tourism industry in China has been one of the fastest growing industry in the past few years, prompting travel agencies to rush to grab a piece of the pie. Ctrip has gained the rewards from this growth, steadily increasing its revenue. However, the market has been hypercompetitive, with price competition crimping profits, and Ctrip has to spend a huge amount of cash in order to maintain its leadership position. However, the merger with one of its biggest competitor Qunar completed in January, 2016, is expected to drive Ctrip's market share in Chinese hotel and airline bookings to about 70%-80%. Meanwhile, The Priceline Group Inc.'s (NASDAQ: PCLN) $500 million investment in Ctrip announced in December 2015, will also bolster the latter's expansion plan in outbound tourism. With Ctrip consolidating its positions in the Chinese tourism market and the growth in foreign travel estimated to continue, it can provide Ctrip the scale and distribution power to increase its profitability.
Outlook
Ctrip also announced its guidance for Q2 FY16, with the company expecting net revenue growth to continue at the y-o-y range of approximately 70% to 75%.
Stock Performance
Ctrip shares saw a correction of 2.14% at the close of yesterday's session. After-market trading session, post the earning release, stocks were up 5.35% at $41.35. The company has been facing a downward trend with the stock losing 11.38% in the past one month.
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