2007'03.11.Sun
eLong Reports Fourth Quarter and Fiscal Year 2006 Unaudited Financial Results
March 09, 2007
BEIJING, March 9 /Xinhua-PRNewswire/ -- eLong, Inc.
(Nasdaq: LONG), a
leading online travel service provider in China, today
reported unaudited
financial results for the fourth quarter and fiscal year
ended December 31,
2006.
(Logo:
http://www.newscom.com/cgi-bin/prnh/20041118/ELONGLOGO )
Business Highlights
Highlights for the fourth quarter of 2006:
* Travel revenues increased 24% year-over-year and
decreased 7%
sequentially to RMB67.1 million (US$8.6 million), and
total revenues
grew 20% year-over-year and decreased 7% sequentially
to RMB69.7 million
(US$8.9 million);
* Hotel commissions increased 23% year-over-year and
decreased 2%
sequentially to RMB56.0 million (US$7.2 million);
* Air ticketing commissions increased 27%
year-over-year and decreased 13%
sequentially to RMB9.6 million (US$1.2 million);
* The Company recorded operating loss of RMB1.3
million(US$165,000) for
the fourth quarter of 2006, which included non-cash
related stock-based
compensation expense and amortization of intangibles
of RMB3.5 million
(US$443,000), as compared to operating loss of
RMB16.8 million
(US$2.1 million) in the same period one year ago and
operating income of
RMB1.7 million (US$215,000) in the third quarter of
2006;
* The Company recorded net loss of RMB1.8 million
(US$234,000) for the
fourth quarter of 2006, as compared to net loss of
RMB8.7 million
(US$1.1 million) in the same period a year ago, and
net income of RMB2.7
million (US$337,000) in the third quarter of 2006;
* The Company recorded adjusted income (a non-GAAP
measure)of RMB13.5
million (US$1.7 million) for the fourth quarter of
2006, as compared to
adjusted loss of RMB1.9 million(US$237,000) in the
same period a year
ago and adjusted income of RMB16.6 million (US$2.1
million) in the third
quarter of 2006; and
* As of December 31, 2006, the Company's cash and cash
equivalents balance
was RMB1,199.3 million (US$153.7 million).
Highlights for fiscal 2006:
* Travel revenues increased 43% year-over-year to
RMB256.0 million
(US$32.8 million), and total revenues increased 39%
year-over-year to
RMB264.5 million (US$33.9 million);
* Hotel commissions increased 38% year-over-year to
RMB209.3 million
(US$26.8 million);
* Air ticketing commissions increased 61%
year-over-year to RMB38.3
million (US$4.9 million);
* The Company recorded operating loss of RMB16.2
million (US$2.1 million)
for fiscal 2006, which included non-cash related
stock-based
compensation expense and amortization of intangibles
of RMB13.1 million
(US$1.7 million), as compared to operating loss of
RMB47.9 million
(US$5.9 million) in fiscal 2005;
* The Company recorded net loss of RMB1.1 million
(US$142,000) for fiscal
2006, as compared to net loss of RMB62.2 million
(US$7.7 million) in
fiscal 2005; and
* The Company recorded adjusted income (a non-GAAP
measure)of
RMB42.1 million (US$5.4 million) for fiscal 2006, as
compared to
adjusted loss of RMB82,000 (US$11,000) in fiscal
2005.
"While we faced a challenging fourth quarter, we
are pleased with the
improvements we have made to our infrastructure during the
period. With the
December launch of our new air search system complementing
our innovative 360-
degree virtual hotel tours, we believe we lead the industry
in leveraging
technology to provide Chinese travelers with enhanced
selection and features.
We made significant operational and financial progress in
2006, achieving 39%
growth in total revenues with only a 10% increase in total
operating expenses.
Service development increased only 15% while we made
demonstrable web
improvements to homepage, hotel and community content, and
to the domestic and
international air booking platform. We are confident that
eLong is
fundamentally stronger than ever and well-positioned to
capture the growth
potential in the online travel market," said Tom
SooHoo, Chief Executive
Officer of eLong.
Separately eLong also announced today the election of
Henrik Kjellberg as
Chairman of the board of directors and the appointment of
Chris Chan as Chief
Financial Officer.
Business Results
Total revenues for the fourth quarter of 2006 were
RMB69.7 million
(US$8.9 million), an increase of 20% from RMB57.9 million
(US$7.2 million)
reported in the same period in 2005, and a decrease of 7%
from RMB74.6 million
(US$9.4 million) reported in the third quarter of 2006.
Total revenues for fiscal 2006 were RMB264.5 million
(US$33.9 million), an
increase of 39% from RMB190.3 million (US$23.6 million) in
fiscal 2005.
Revenue from hotel commissions for the fourth quarter
of 2006 totaled
RMB56.0 million (US$7.2 million), an increase of 23% from
RMB45.6 million
(US$5.6 million) year-over-year, and a decrease of 2% from
RMB57.4 million
(US$7.3 million) sequentially.
The year-over-year increase in revenue from hotel
commissions was
primarily due to higher room volumes accompanied by higher
hotel commissions
per room night. Hotel room nights booked through eLong
increased 19% to
860,000 in the fourth quarter from 724,000 room nights in
the corresponding
period a year ago and were down 4% sequentially from
893,000 in the third
quarter of 2006. The sequential decrease in revenue from
hotel commissions was
due to lower room volumes. Hotel commissions per room night
were RMB65 in the
fourth quarter of 2006, up 3% from RMB63 in the
corresponding period a year
ago, and up 2% from RMB64 in the third quarter. Hotel
commissions increased
due to better override as a result of higher room volume.
Revenue from hotel commissions for fiscal 2006 totaled
RMB209.3 million
(US$26.8 million), an increase of 38% from RMB152.0 million
(US$18.8 million)
in fiscal 2005. The total number of hotel room nights
booked through eLong in
fiscal 2006 was 3.25 million compared to 2.54 million in
fiscal 2005, an
increase of 28%. Hotel commissions per room night were
RMB64 in 2006, up 7%
from RMB60 in fiscal 2005 mainly due to higher commissions
associated with
increased volume.
As of December 31, 2006, eLong offered discounted rates
at a choice of
3,505 hotels in 294 cities across China as compared to
slightly fewer than
3,100 hotels in 278 cities a year ago.
Revenue from air ticketing commissions during the
fourth quarter of 2006
totaled RMB9.6 million (US$1.2 million), an increase of 27%
from RMB7.6
million (US$936,000) year-over-year, and a decrease of 13%
from RMB11.0
million (US$1.4 million) sequentially. Volume in air
segment sales totaled
269,000 in the fourth quarter of 2006, an increase of 25%
from 215,000 in the
corresponding period a year ago and a decrease of 1% from
273,000 in the third
quarter. Revenue per air ticket was RMB36 in the fourth
quarter of 2006 as
compared to RMB35 in the corresponding period a year ago
and RMB41 in the
third quarter. The sequential decrease of revenue per air
ticket was primarily
due to a decrease in the average air ticket price.
Revenues from air ticketing commissions for fiscal 2006
totaled RMB38.3
million (US$4.9 million), an increase of 61% from RMB23.8
million
(US$2.9 million) in fiscal 2005. Air segment sales were
1.01 million in fiscal
2006, an increase of 55% from 651,000 air segments sold in
fiscal 2005. Year-
over-year growth in air ticketing revenues was primarily
driven by the
acquisition of new air customers, increased sales of air
tickets to eLong's
existing hotel customer base and better product offerings.
Other travel revenue in the fourth quarter of 2006 was
RMB1.5 million
(US$186,000), an increase of 79% from RMB813,000
(US$101,000) year-over-year,
and a decrease of 62% from RMB3.9 million(US$488,000)
sequentially. The
sequential decrease was attributable to RMB2.6 million
(US$325,000) in revenue
recorded when the related contract was finalized in the
third quarter of 2006
for inventory procurement services provided to Expedia by
eLong for the period
from January 2005 through September 2006.
Other travel revenue for fiscal 2006 was RMB8.4 million
(US$1.1 million)
as compared to RMB2.7 million (US$334,000) in fiscal 2005.
The year-over-year
increase was mainly due to the increased revenues of
vacation packages and as
well as services provided to Expedia as explained above.
Gross margin in the fourth quarter of 2006 was 76%, as
compared to 80% in
the corresponding period a year ago and 77% in the third
quarter. The year-
over-year reduction in gross margin was a result of
reduction in higher-margin
non-travel revenue, additional compensation and benefits
for call center
employees and a slightly increased proportion of revenue
contributed by the
air ticketing business.
Gross margin in fiscal 2006 was 76% as compared to 79%
in fiscal 2005. The
year-over-year reduction in gross margin was due to reasons
similar to those
explained above.
Service development, sales and marketing and general
and administrative
expenses for the fourth quarter of 2006 totaled RMB49.7
million
(US$6.4 million), a decrease of 17% from RMB59.7 million
(US$7.4 million)
year-over-year, and a decrease of 3% from RMB51.4 million
(US$6.5 million)
sequentially. These expenses for fiscal 2006 were RMB202.4
million
(US$25.9 million), an increase of 8% from RMB186.7 million
(US$23.1 million)
in fiscal 2005.
Service development expenses were RMB10.6 million
(US$1.4 million) in the
fourth quarter of 2006, a decrease of 14% from RMB12.4
million
(US$1.5 million) year-over-year, and a decrease of 1% from
RMB10.7 million
(US$1.4 million) sequentially. The year-over-year decrease
reflected
improvements in operational efficiencies. Service
development expenses in the
fourth quarter of 2006 were 15% of revenues as compared to
21% in the
corresponding period a year ago and 14% in the third
quarter.
Service development expenses for fiscal 2006 were
RMB41.9 million
(US$5.4 million), an increase of 15% from RMB36.3 million
(US$4.5 million) in
fiscal 2005 due to ramped-up investments to support the
eLong.com website and
the Company's air, hotel and vacation package businesses.
Service development
expenses for fiscal 2006 were 16% of revenues as compared
to 19% in fiscal
2005.
Sales and marketing expenses were RMB26.6 million
(US$3.4 million) in the
fourth quarter of 2006,a decrease of 8% from RMB28.8
million (US$3.6 million)
year-over-year, and an increase of 5% from RMB25.3 million
(US$3.2 million) in
the third quarter. Sales and marketing expenses in the
fourth quarter of 2006
were 38% of revenues as compared to 50% in the
corresponding period a year ago
and 34% in the third quarter.
Sales and marketing expenses for fiscal 2006 were
RMB99.0 million
(US$12.7 million),an increase of 6% from RMB93.2 million
(US$11.5 million) in
fiscal 2005. Sales and marketing expenses for fiscal 2006
were 37% of revenues
as compared to 49% in fiscal 2005.
General and administrative expenses were RMB12.6
million (US$1.6 million)
in the fourth quarter of 2006,a decrease of 32% from
RMB18.6 million
(US$2.3 million) year-over-year, and a decrease of 18% from
RMB15.4 million
(US$1.9 million) sequentially. The year-over-year and
sequential decreases
were due to lower professional fees in the fourth quarter.
General and
administrative expenses in the fourth quarter of 2006 were
18% of revenues as
compared to 32% in the corresponding period a year ago and
21% in the third
quarter.
General and administrative expenses for fiscal 2006
were RMB61.5 million
(US$7.9 million), an increase of 8% from RMB57.2 million
(US$7.1 million) in
fiscal 2005. The rise was due to additional professional
fees, headcount
expenses and other expenditures associated with business
expansion and public
company expenses. General and administrative expenses for
fiscal 2006 were 23%
of revenues as compared to 30% in fiscal 2005.
Operating loss in the fourth quarter of 2006 was RMB1.3
million
(US$165,000), as compared to an operating loss of RMB16.8
million
(US$2.1 million) in the corresponding period of 2005 and an
operating income
of RMB1.7 million (US$215,000) in the third quarter. The
fourth quarter
operating loss included non-cash related stock-based
compensation expense and
amortization of intangibles of RMB3.5 million (US$443,000),
and the comparable
non-cash related stock-based compensation expense and
amortization amount was
RMB3.8 million (US$472,000) for the corresponding period of
2005 and RMB2.6
million (US$330,000) for the third quarter of 2006.
Operating loss for fiscal 2006 was RMB16.2 million
(US$2.1 million), as
compared to an operating loss of RMB47.9 million (US$5.9
million) in fiscal
2005.
Other income, which represents interest income,
unrealized exchange
gains/losses and other income/expenses, was RMB2.3 million
(US$293,000) for
the fourth quarter of 2006, as compared to other income of
RMB6.5 million
(US$805,000) in the corresponding period a year ago, and
other income of
RMB3.4 million (US$424,000) in the third quarter of 2006.
The sequential
decrease in other income was primarily due to a higher
unrealized foreign
exchange loss on the translation for financial reporting
purposes of eLong's
US dollar denominated cash deposits and interest income
into Renminbi. The
unrealized foreign exchange loss was RMB11.9 million
(US$1.5 million) in the
fourth quarter as compared to an unrealized exchange loss
of RMB11.4 million
(US$1.4 million) in the third quarter.
Other income for fiscal 2006 was RMB18.4 million
(US$2.4 million) as
compared to other income of RMB4.5 million (US$563,000) in
fiscal 2005 due to
higher interest income generated from higher cash balance
and higher interest
rate, partially offset by higher unrealized foreign
exchange losses.
The Company recorded a net loss of RMB1.8 million
(US$234,000) for the
fourth quarter of 2006, as compared to a net loss of RMB8.7
million
(US$1.1 million) in the corresponding period a year ago,
and a net income of
RMB2.7 million (US$337,000) in the third quarter. The US
GAAP diluted loss per
ADS for the fourth quarter of 2006 was RMB0.08 (US$0.011),
as compared to US
GAAP diluted loss per ADS of RMB0.34 (US$0.042) in the
corresponding period a
year ago and US GAAP diluted income per ADS of RMB0.10
(US$0.013) in the third
quarter. Adjusted income for the fourth quarter of 2006 (a
non-GAAP measure)
was RMB13.5 million (US$1.7 million), as compared to
adjusted loss of RMB1.9
million (US$237,000) in the corresponding period a year ago
and adjusted
income of RMB16.6 million (US$2.1 million) in the third
quarter. Diluted
adjusted income per ADS for the fourth quarter (also a
non-GAAP measure) was
RMB0.50 (US$0.064), as compared to diluted adjusted loss
per ADS of RMB0.08
(US$0.010) in the corresponding period a year ago and
diluted adjusted income
per ADS of RMB0.62 (US$0.078) in the third quarter. Please
refer to the
attached table for a reconciliation of net income/loss and
basic and diluted
income/loss per ADS under US GAAP to adjusted income/loss
and basic and
diluted adjusted income/loss per ADS.
The Company recorded a net loss of RMB1.1 million
(US$142,000) for fiscal
2006, as compared to a net loss of RMB62.2 million (US$7.7
million) in fiscal
2005. The US GAAP diluted loss per ADS for fiscal 2006 was
RMB0.06 (US$0.008),
as compared to US GAAP diluted loss per ADS of RMB2.5
(US$0.310) in fiscal
2005. Adjusted income for fiscal 2006 (a non-GAAP measure)
was RMB42.1 million
(US$5.4 million), as compared to adjusted loss of RMB82,000
(US$11,000) in
fiscal 2005. Diluted adjusted income per ADS for fiscal
2006 (also a non-GAAP
measure) was RMB1.56 (US$0.200), compared to diluted
adjusted loss per ADS of
RMB0.00 (US$0.000) in fiscal 2005. Please refer to the
attached table for a
reconciliation of net income/loss and income/loss per ADS
under US GAAP to
adjusted income/loss and basic and diluted adjusted
income/loss per ADS.
As of December 31, 2006, the Company's cash and cash
equivalents balance
was RMB1,199.3 million (US$153.7 million).
"We are pleased with the year-over-year
improvement in operating leverage.
Building on the solid progress eLong has made in the past
year, in 2007 we
will continue to focus on our execution and investment in
the business for
long-term sustained profitability," said Tony Shen,
interim Chief Financial
Officer of eLong.
Business Outlook
eLong expects total revenues for the first quarter of
2007 within the
range of RMB62.0 million (US$8.0 million) to RMB66.0
million (US$8.5 million),
an increase of 16% to 23% from the first quarter of 2006.
Note to the Unaudited Interim Consolidated Financial
Statements
The unaudited financial information disclosed above is
preliminary. The
audit of the financial statements and related notes to be
included in our
annual report on Form 20-F for the year ended December 31,
2006, is still in
progress.
Adjustments to the financial statements may be
identified when the audit
work is completed, which could result in significant
differences between our
audited financial statements and this preliminary unaudited
financial
information.
In the fourth quarter, The Company recognized net
proceeds of RMB94.2
million (US$12.1 million) in equity, which was related to a
sale of a division
operating an interactive online dating community to a
related party purchaser.
The transaction was disclosed in the third quarter earnings
release.
As of December 31, 2006, the Company's additional
paid-in capital was
RMB1,301.3 million (US$166.7 million), the increase of
which was mainly due to
proceeds received as explained above.
Certain 2005 compensation amounts have been
reclassified to conform to the
current year's presentation.
Safe Harbor Statement
It is currently expected that the Business Outlook will
not be updated
until the release of eLong's next quarterly earnings
announcement; however,
eLong reserves the right to update its Business Outlook at
any time for any
reason.
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,
and 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,"
"should" and "will" and similar
expressions as
they related to the Company 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.
Furthermore, these statements are, by their nature, subject
to a number of
risks and uncertainties that could cause actual performance
and results to
differ materially from those discussed in the
forward-looking statements as a
result of a number of factors. Factors that could affect
the Company's actual
results and cause actual results to differ materially from
those included in
any forward-looking statement include, but are not limited
to, eLong's
historical operating losses, its limited operating history,
declines or
disruptions in the travel industry, the recurrence of SARS,
an outbreak of
bird flu, eLong's reliance on having good relationships
with hotel suppliers
and airline ticket suppliers, our reliance on the Travelsky
GDS system for our
air business, the possibility that eLong will be unable to
timely comply with
Section 404 of the Sarbanes-Oxley Act of 2002, the risk
that eLong will not be
successful in competing against new and existing
competitors, risks associated
with Expedia, Inc.'s (Nasdaq: EXPE) majority ownership
interest in eLong and
the integration of eLong's business with that of Expedia's,
subsequent
revaluations of the Chinese currency, changes in eLong's
management team and
other key personnel and other risks outlined in eLong's
filings with the U.S.
Securities and Exchange Commission(or SEC), including
eLong's Form 20-F filed
with the SEC in connection with the Company's fiscal year
2005 results.
Readers are cautioned not to place undue reliance on any
forward-looking
statements, which speak only as of their dates.
Conference Call
eLong will host a conference call to discuss its fourth
quarter and fiscal
2006 earnings at 8:00 pm Eastern Time, March 8,
2007(Beijing/Hong Kong time:
March 9, 2007 at 9:00 am). The management team will be on
the call to discuss
quarterly results and highlights and to answer questions.
The toll-free number
for U.S. participants is +1 800 365 8460. The dial-in
number for Hong Kong
participants is +85222584000. The toll number for
international participants
is +1 210 795 0492. The passcode for all participants is
"eLong".
A replay of the call will be available for 1 day
between 9:15 pm Eastern
Time on March 8, 2007 and 9:15 pm Eastern Time on March 9,
2007. The toll-free
number for U.S. callers is +1 8884852361. The dial-in
number for international
callers is +1 203 369 4583. The passcode for the replay is
789530.
Additionally, a live and archived web cast of this call
will be available
on the Investor Relations section of the eLong web site at
http://ir.elong.net
for three months.
About eLong, Inc.
eLong, Inc. (Nasdaq: LONG) is a leading online travel
company in China.
Headquartered in Beijing, eLong has a national presence
across China. eLong
uses web-based distribution technologies and a 24-hour call
center to provide
consumers with access to travel reservation services.
Aiming to enrich
people's lives through the freedom of independent travel,
eLong empowers
consumers to make informed choices by providing a one-stop
travel solution and
consolidated travel tools and information such as maps,
virtual tours and user
ratings. eLong has the capacity to fulfill air ticket
reservations in over 57
major cities across China. In addition to choice of a wide
hotel selection in
the Greater China region, eLong offers Chinese consumers
the ability to make
bookings at international hotels in over 140 destinations
worldwide. eLong
operates the websites http://www.elong.com and
http://www.elong.net.
Investor Contact:
Raymond Huang
eLong, Inc.
Investor Relations Manager
ir@corp.elong.com
86-10-5860-2288 ext. 6633
eLong, Inc. CONSOLIDATED STATEMENT OF OPERATIONS
(UNAUDITED, IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
IN LOCAL CURRENCY
Three Months Ended
Year Ended
Dec. 31, Sep. 30, Dec. 31,
Dec. 31, Dec. 31,
2006 2006 2005
2006 2005
RMB RMB RMB
RMB RMB
Revenues
Hotel commissions 56,026 57,412 45,580
209,275 151,990
Air ticketing commissions 9,593 11,045 7,551
38,288 23,773
Other travel revenue 1,452 3,860 813
8,398 2,696
Total travel revenue 67,071 72,317 53,944
255,961 178,459
Non travel 2,647 2,263 3,991
8,583 11,870
Total revenues 69,718 74,580 57,935
264,544 190,329
Cost of services 16,651 17,124 11,439
62,234 40,447
Gross profit 53,067 57,456 46,496
202,310 149,882
Operating expenses
Service development 10,569 10,718 12,359
41,855 36,298
Sales and marketing 26,555 25,331 28,781
99,038 93,185
General and administrative 12,611 15,376 18,601
61,528 57,212
Amortization of intangibles 265 265 189
1,060 634
Business tax and surcharges 4,347 4,064 3,325
15,067 10,488
Total operating expenses 54,347 55,754 63,255
218,548 197,817
Income/(loss) from operations (1,280) 1,702 (16,759)
(16,238) (47,935)
Other income 2,289 3,353 6,499
18,403 4,547
Income/(loss) before income
tax expense 1,009 5,055 (10,260)
2,165 (43,388)
Income tax expense 1,490 2,199 948
4,475 1,603
Income/(loss) from continuing
operations (481) 2,856 (11,208)
(2,310) (44,991)
Discontinued operations
Income/(loss) from
discontinued operations (1,332) (204) 2,770
(1,423) (16,952)
Income tax expense/(benefit)
of discontinued operations (2) (15) 227
24 281
Gain on sale of discontinued
operations - - -
2,650 -
Total discontinued operations (1,330) (189) 2,543
1,203 (17,233)
Net income/(loss) (1,811) 2,667 (8,665)
(1,107) (62,223)
Basic income/(loss) per share -
-
Continuing operations (0.01) 0.06 (0.22)
(0.05) (0.91)
Discontinued operations (0.03) 0.00 0.05
0.02 (0.35)
Basic income/(loss) per share (0.04) 0.06 (0.17)
(0.03) (1.25)
Diluted income/(loss) per
share
Continuing operations (0.01) 0.05 (0.22)
(0.05) (0.91)
Discontinued operations (0.03) 0.00 0.05
0.02 (0.35)
Diluted income/(loss) per
share (0.04) 0.05 (0.17)
(0.03) (1.25)
Basic income/(loss) per ADS
Continuing operations (0.02) 0.12 (0.45)
(0.10) (1.81)
Discontinued operations (0.06) 0.00 0.10
0.04 (0.68)
Basic income/(loss) per ADS (0.08) 0.12 (0.34)
(0.06) (2.50)
Diluted income/(loss) per ADS
Continuing operations (0.02) 0.10 (0.45)
(0.10) (1.81)
Discontinued operations (0.06) 0.00 0.10
0.04 (0.68)
Diluted income/(loss) per ADS (0.08) 0.10 (0.34)
(0.06) (2.50)
Shares used in computing basic
net income/(loss) per share 50,464 50,374 50,311
50,392 49,638
Shares used in computing
diluted net income/(loss) per
share 50,464 53,878 50,311
50,392 49,638
Note that 1ADS = 2 shares
eLong, Inc. CONSOLIDATED STATEMENT OF OPERATIONS
(UNAUDITED, IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
IN U.S. DOLLARS
Three Months Ended
Year Ended
Dec. 31, Sep. 30, Dec. 31,
Dec. 31, Dec. 31,
2006 2006 2005
2006 2005
US$ US$ US$
US$ US$
Revenues
Hotel commissions 7,179 7,264 5,648
26,816 18,833
Air ticketing
commissions 1,229 1,397 936
4,906 2,946
Other travel revenue 186 488 101
1,076 334
Total travel revenue 8,594 9,149 6,684
32,798 22,113
Non travel 339 286 495
1,100 1,471
Total revenues 8,933 9,435 7,179
33,898 23,584
Cost of services 2,134 2,166 1,417
7,975 5,012
Gross profit 6,799 7,269 5,761
25,923 18,572
Operating expenses
Service development 1,354 1,356 1,531
5,363 4,498
Sales and marketing 3,403 3,205 3,566
12,691 11,547
General and
administrative 1,616 1,945 2,305
7,884 7,089
Amortization of
intangibles 34 34 23
136 79
Business tax and
surcharges 557 514 412
1,931 1,300
Total operating expenses 6,964 7,054 7,838
28,005 24,512
Income/(loss) from
operations (165) 215 (2,077)
(2,082) (5,940)
Other income 293 424 805
2,358 563
Income/(loss) before
income tax expense 128 639 (1,271)
276 (5,376)
Income tax expense 191 278 117
573 199
Income/(loss) from
continuing operations (63) 361 (1,389)
(297) (5,575)
Discontinued operations
Income/(loss) from
discontinued operations (171) (26) 343
(182) (2,101)
Income tax
expense/(benefit) of
discontinued operations - (2) 28
3 35
Gain on sale of
discontinued operations - - -
340 -
Total discontinued
operations (171) (24) 315
155 (2,135)
Net income/(loss) (234) 337 (1,074)
(142) (7,710)
Basic income/(loss) per
share
Continuing operations (0.001) 0.008 (0.028)
(0.006) (0.112)
Discontinued operations (0.004) 0.000 0.006
0.003 (0.043)
Basic income/(loss) per
share (0.005) 0.008 (0.021)
(0.003) (0.155)
Diluted income/(loss)
per share
Continuing operations (0.001) 0.006 (0.028)
(0.006) (0.112)
Discontinued operations (0.004) 0.000 0.006
0.003 (0.043)
Diluted income/(loss)
per share (0.005) 0.006 (0.021)
(0.003) (0.155)
Basic income/(loss) per
ADS
Continuing operations (0.003) 0.015 (0.055)
(0.013) (0.225)
Discontinued operations (0.008) 0.000 0.013
0.005 (0.085)
Basic income/(loss) per
ADS (0.011) 0.015 (0.042)
(0.008) (0.310)
Diluted income/(loss)
per ADS
Continuing operations (0.003) 0.013 (0.055)
(0.013) (0.225)
Discontinued operations (0.008) 0.000 0.013
0.005 (0.085)
Diluted income/(loss)
per ADS (0.011) 0.013 (0.042)
(0.008) (0.310)
Shares used in computing
basic net income/(loss)
per share 50,464 50,374 50,311
50,392 49,638
Shares used in computing
diluted net
income/(loss) per share 50,464 53,878 50,311
50,392 49,638
Note 1: The conversions of Renminbi (RMB) into United
States dollars (USD)
as at the reporting dates are based on the noon buying
rate of USD1.00 =
RMB7.8041 on December 31,2006, USD1.00 = RMB7.904 on
September 30, 2006
and USD1.00 = RMB8.0702 on December 31, 2005 in the
City of New York for
cable transfers of Renminbi as certified for customs
purposes by the
Federal Reserve. No representation is intended to imply
that the RMB
amounts could have been, or could be, converted,
realized or settled into
U.S. dollars at that rate on the reporting dates.
eLong, Inc.
CONSOLIDATED SUMMARY BALANCE SHEET DATA
(UNAUDITED, IN THOUSANDS)
Dec. 31, Dec. 31,
Dec. 31, Dec. 31,
2006 2005
2006 2005
ASSETS RMB RMB
US$ US$
Current assets
Cash and cash equivalents 1,199,323 988,560
153,679 122,495
Restricted cash equivalents - 76,177
- 9,439
Total Accounts receivable, net 28,493 34,655
3,651 4,294
Investment securities 163 260
21 32
Prepaid expenses and other current
assets 12,772 9,982
1,636 1,237
Total current assets 1,240,751 1,109,634
158,987 137,498
Equipment and software, net 37,809 33,306
4,845 4,127
Goodwill 30,000 34,083
3,844 4,223
Intangibles 3,746 4,806
480 596
Other non-current assets 22,029 6,508
2,823 806
Deferred tax assets 982 84
126 10
Total assets 1,335,317 1,188,421
171,105 147,260
LIABILITIES AND SHAREHOLDERS'
EQUITY
Current liabilities
Accounts payable, accrued expenses
and other payables 112,328 88,013
14,394 10,906
Advances from customers 1,361 736
174 91
Short term loans - 6,000
- 743
Taxes payable 20,735 3,004
2,657 372
Total current liabilities 134,424 97,753
17,225 12,112
Other long term liabilities 980 -
126 -
Deferred Tax Liabilities 132 132
17 16
Total liabilities 135,536 97,885
17,368 12,128
Minority interest - 1,628
- 202
Shareholders' equity
Ordinary shares 4,192 4,167
537 516
Additional paid-in capital 1,301,312 1,216,879
166,747 150,787
Other equity items 2,398
(26,441) 307 (3,276)
Accumulated deficit and other
comprehensive income (108,121)
(105,697) (13,854) (13,097)
Total shareholders' equity 1,199,781 1,088,908
153,737 134,930
Total liabilities and
shareholders' equity 1,335,317 1,188,421
171,105 147,260
eLong, Inc.
RECONCILIATION OF US GAAP INCOME/(LOSS) AND EPS TO
NON-GAAP ADJUSTED
INCOME/(LOSS) AND EPS
(UNAUDITED, IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
IN LOCAL CURRENCY
Three Months Ended
Year Ended
Dec. 31, Sep. 30, Dec.
31, Dec. 31, Dec. 31,
2006 2006 2005
2006 2005
RMB RMB RMB
RMB RMB
Net income/(loss) (1,811) 2,667
(8,665) (1,107) (62,223)
Amortization of non-cash stock-
based compensation 3,194 2,341 3,626
12,006 16,507
Amortization of intangibles 265 265 189
1,060 1,190
Other non-cash compensation - - 505
- 1,011
Unrealised foreign exchange
losses on US$ net monetary
assets/liabilities 11,899 11,357 2,439
32,803 25,888
Writedown of subsidiary's
goodwill and intangibles - - -
- 17,545
Gain on disposal of discontinued
operations - - -
(2,650) -
Adjusted income/(loss) 13,547 16,630
(1,906) 42,112 (82)
Basic adjusted income/(loss) per
share 0.27 0.33
(0.04) 0.84 0.00
Diluted adjusted income/(loss)
per share 0.25 0.31
(0.04) 0.78 0.00
Basic adjusted income/(loss) per
ADS 0.54 0.66
(0.08) 1.68 0.00
Diluted adjusted income/(loss)
per ADS 0.50 0.62
(0.08) 1.56 0.00
Shares used in computing adjusted
basic income/(loss) per share 50,464 50,374 50,311
50,392 49,638
Shares used in computing adjusted
diluted income/(loss) per share 53,860 53,878 50,311
53,749 49,638
eLong, Inc.
RECONCILIATION OF US GAAP INCOME/(LOSS) AND EPS TO
NON-GAAP ADJUSTED
INCOME/(LOSS) AND EPS
(UNAUDITED, IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
IN U.S. DOLLARS
Three Months Ended
Year Ended
Dec. 31, Sep. 30, Dec.
31, Dec. 31, Dec. 31,
2006 2006 2005
2006 2005
US$ US$ US$
US$ US$
Net income/(loss) (234) 337
(1,074) (142) (7,710)
Amortization of non-cash stock-
based compensation 409 296
449 1,538 2,045
Amortization of intangibles 34 34
23 136 147
Other non-cash compensation - -
63 - 125
Unrealised foreign exchange losses
on US$ net monetary
assets/liabilities 1,525 1,437
302 4,203 3,208
Writedown of subsidiary's goodwill
and intangibles - - -
- 2,174
Gain on disposal of discontinued
operations - - -
(340) -
Adjusted income/(income) 1,734 2,104
(237) 5,395 (11)
Basic adjusted income/(loss) per
share 0.034 0.042
(0.005) 0.107 (0.000)
Diluted adjusted income/(loss) per
share 0.032 0.039
(0.005) 0.100 (0.000)
Basic adjusted income/(loss) per
ADS 0.068 0.084
(0.009) 0.214 (0.000)
Diluted adjusted income/(loss) per
ADS 0.064 0.078
(0.010) 0.200 (0.000)
Shares used in computing adjusted
basic income/(loss) per share 50,464 50,374
50,311 50,392 49,638
Shares used in computing adjusted
diluted income/(loss) per share 53,860 53,878
50,311 53,749 49,638
Use of Non-GAAP Financial Information
To supplement our consolidated financial statements
presented herein in
accordance with accounting principles generally
accepted in the United
States ("US GAAP"), the Company also uses
non-GAAP measures of adjusted
net income/(loss) and adjusted diluted income/(loss)
per ADS, which are
adjusted from results based on US GAAP to exclude the
impact of (1)
amortization of non-cash stock-based compensation
expense, (2)
amortization of intangible assets, (3) other non-cash
compensation, (4)
unrealised foreign exchange losses on the conversion of
eLong's US$
denominated net monetary assets/liabilities into
Renminbi,(5)writedown of
subsidiary good will and in tangibles, and (6)gain on
disposal of
discontinued operations. Management believes these
non-GAAP financial
measures enhance the user's overall understanding of
our current financial
performance and our prospects for the future and,
additionally, uses these
non-GAAP financial measures internally for the general
purpose of
analyzing and managing the Company's business.
Specifically, we believe
the non-GAAP financial measures provide useful
information to both
management and investors by excluding certain charges
that we believe are
not indicative of our core operating results. The
presentation of this
additional information is not meant to be considered
superior to, in
isolation from or as a substitute for results prepared
in accordance with
US GAAP.
For more information, please contact:
Raymond Huang
eLong, Inc.
Tel: +86-10-5860-2288 ext. 6633
Email: ir@corp.elong.com
PR
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