China Lodging Group, Limited
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By:
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/s/ Qi Ji
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Name: Qi Ji
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Title: Chief Executive Officer
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Date: March 7, 2013
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Exhibit Number
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Description
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Exhibit 99.1
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China Lodging Group, Limited Reports Fourth Quarter and Full Year 2012 Financial Results
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Ÿ
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Net Revenues increased 35.7% year-over-year for the fourth quarter and 43.3% for the full year of 2012, exceeding the high end of previously announced guidance.
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Ÿ
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Adjusted EBITDA from operating hotels (non-GAAP)1 increased 23.8% for the fourth quarter and 43.6% for the full year of 2012.
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Ÿ
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Net income attributable to China Lodging Group, Limited was RMB18.2 million (US$2.9 million)2 for the fourth quarter and RMB174.9 million (US$28.1 million) for the full year of 2012. Diluted net earnings per ADS3 for the year were RMB2.83 (US$0.45); adjusted diluted net earnings per ADS (non-GAAP) for the year were RMB3.17 (US$0.51), representing a growth of 49.5% from prior year.
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Ÿ
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A total of 1,035 hotels or 113,650 hotel rooms in operation as of December 31, 2012
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Ÿ
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The Company provided guidance for full year 2013 net revenues growth of 26% to 29% and Q1 net revenue growth of 30% to 32%.
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•
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During the fourth quarter of 2012, the Company opened 50 leased (“leased-and- operated”) hotels and 70 net manachised (“franchised-and-managed”) hotels.
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•
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The occupancy rate for all hotels in operation (excluding franchised Starway hotels) was 92% in the fourth quarter of 2012, compared with 93% in the fourth quarter of 2011 and 97% in the previous quarter. The slight year-over-year decrease was mainly because our fast expansion led to a higher percentage of manachised hotels at the ramping-up stage during the fourth quarter of 2012, compared to a year ago. The sequential decrease resulted mainly from seasonality.
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•
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The ADR, which is defined as the average daily rate for all hotels in operation (excluding franchised Starway hotels), was RMB176 in the fourth quarter of 2012, compared with RMB179 in the fourth quarter of 2011 and RMB183 in the previous quarter. The year-over-year decrease was mainly attributable to the city mix shifting toward lower-tier cities, partially offset by an increase in same-hotel ADR. The sequential decrease resulted mainly from seasonality.
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•
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RevPAR, defined as revenue per available room for all hotels in operation (excluding franchised Starway hotels), was RMB162 in the fourth quarter of 2012, compared with RMB167 in the fourth quarter of 2011 and RMB178 in the previous quarter. RevPAR for leased hotels was RMB167 in the fourth quarter of 2012, compared with RMB170 in the fourth quarter of 2011, and RMB183 in the previous quarter.
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•
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For all hotels which had been in operation for at least 18 months (excluding franchised Starway hotels), the same-hotel RevPAR was RMB179 for the fourth quarter of 2012, a 2% increase from RMB175 for the fourth quarter of 2011, with a 1% increase in ADR and a one percentage-point increase in occupancy rate.
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•
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For the full year of 2012, the Company opened 121 net new leased hotels and 221 net new manachised hotels, a total of 342 hotels, exceeding our previously announced guidance. As of December 31, 2012, the Company had 465 leased hotels, 516 manachised hotels, and 54 franchised Starway hotels in operation in 171 cities. The leased and manachised hotel rooms in operation increased by 35% and 72%, respectively, from a year ago.
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•
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As of December 31, 2012, the Company had a total pipeline of 410 new hotels, including 80 leased hotels and 330 manachised hotels.
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•
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For the full year of 2012, the occupancy rate for all hotels in operation (excluding franchised Starway hotels) was 94%, two percentage points higher than 2011.
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•
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For the full year of 2012, the ADR was RMB178, compared to RMB180 in 2011. The decrease was primarily due to the shift of city mix of hotels toward lower-tier cities, partially offset by an increase in same-hotel ADR.
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•
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For the full year of 2012, the RevPAR for all hotels in operation, excluding franchised Starway hotels, was RMB168, a 2% increase from RMB165 in 2011. RevPAR for leased hotel was RMB 173, a 4% increase from RMB167 in 2011.
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•
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For all the hotels which had been in operation for at least 18 months, excluding franchised Starway hotels, the same-hotel RevPAR was RMB186 in 2012, a 6% increase from RMB176 in 2011, with a 2% increase in ADR and a three percentage-point increase in occupancy rate.
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•
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As of December 31, 2012, the Company’s loyalty program had more than 8 million members, who contributed more than 80% of room nights sold during the full year of 2012. In 2012, 96% of room nights were sold through the Company’s own channels.
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China Lodging Group, Limited
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Unaudited Condensed Consolidated Balance Sheets
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December 31, 2011
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September 30, 2012
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December 31, 2012
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RMB
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RMB
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RMB
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US$
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(in thousands)
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||||||||||||||||
Assets
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||||||||||||||||
Current assets:
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||||||||||||||||
Cash and cash equivalents
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781,601 | 465,695 | 449,844 | 72,205 | ||||||||||||
Restricted cash
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1,500 | 61,455 | 1,790 | 287 | ||||||||||||
Short-term Investment
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- | - | 8,074 | 1,296 | ||||||||||||
Accounts receivable, net
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37,416 | 48,125 | 50,633 | 8,127 | ||||||||||||
Prepaid rent
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228,087 | 278,276 | 321,305 | 51,573 | ||||||||||||
Inventories
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31,232 | 32,980 | 37,971 | 6,095 | ||||||||||||
Other current assets
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53,862 | 63,886 | 83,058 | 13,332 | ||||||||||||
Deferred tax assets
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40,119 | 40,119 | 44,231 | 7,099 | ||||||||||||
Total current assets
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1,173,817 | 990,536 | 996,906 | 160,014 | ||||||||||||
Property and equipment, net
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2,095,794 | 2,670,518 | 2,951,509 | 473,750 | ||||||||||||
Intangible assets, net
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69,779 | 117,881 | 100,980 | 16,208 | ||||||||||||
Long term investment
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28,129 | 28,129 | 4,515 | |||||||||||||
Goodwill
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42,536 | 42,689 | 64,180 | 10,302 | ||||||||||||
Other assets
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102,056 | 126,508 | 133,536 | 21,434 | ||||||||||||
Deferred tax assets
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40,968 | 40,968 | 54,947 | 8,820 | ||||||||||||
Total assets
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3,524,950 | 4,017,229 | 4,330,187 | 695,043 | ||||||||||||
Liabilities and equity
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||||||||||||||||
Current liabilities:
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||||||||||||||||
Long-term debt, current portion
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- | 240 | - | - | ||||||||||||
Accounts payable
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417,605 | 502,034 | 624,824 | 100,291 | ||||||||||||
Amount due to related parties
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1,030 | 1,168 | 801 | 129 | ||||||||||||
Salary and welfare payable
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80,266 | 60,069 | 117,980 | 18,937 | ||||||||||||
Deferred revenue
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138,148 | 183,703 | 200,515 | 32,185 | ||||||||||||
Accrued expenses and other current liabilities
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142,146 | 176,318 | 187,380 | 30,076 | ||||||||||||
Income tax payable
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14,148 | 2,474 | 23,142 | 3,715 | ||||||||||||
Total current liabilities
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793,343 | 926,006 | 1,154,642 | 185,333 | ||||||||||||
Long-term debt
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- | 640 | - | - | ||||||||||||
Deferred rent
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329,774 | 434,520 | 470,438 | 75,511 | ||||||||||||
Deferred revenue
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71,698 | 93,504 | 99,800 | 16,019 | ||||||||||||
Other long-term liabilities
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61,574 | 85,129 | 92,407 | 14,832 | ||||||||||||
Deferred tax liabilities
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12,677 | 12,677 | 22,335 | 3,585 | ||||||||||||
Total liabilities
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1,269,066 | 1,552,476 | 1,839,622 | 295,280 | ||||||||||||
Equity
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Ordinary shares
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179 | 180 | 180 | 29 | ||||||||||||
Additional paid-in capital
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2,199,954 | 2,234,254 | 2,243,403 | 360,091 | ||||||||||||
Retained earnings
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85,127 | 241,822 | 260,014 | 41,735 | ||||||||||||
Accumulated other comprehensive loss
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(39,166 | ) | (37,648 | ) | (38,408 | ) | (6,165 | ) | ||||||||
Total China Lodging Group, Limited equity
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2,246,094 | 2,438,608 | 2,465,189 | 395,690 | ||||||||||||
Noncontrolling interest
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9,790 | 26,145 | 25,376 | 4,073 | ||||||||||||
Total equity
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2,255,884 | 2,464,753 | 2,490,565 | 399,763 | ||||||||||||
Total liabilities and equity
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3,524,950 | 4,017,229 | 4,330,187 | 695,043 |
China Lodging Group, Limited
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Unaudited Condensed Consolidated Statements of Operations
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Quarter Ended
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Year Ended
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December 31, 2011
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September 30, 2012
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December 31, 2012
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December 31, 2011
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December 31, 2012
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RMB
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RMB
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RMB
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US$
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RMB
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RMB
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US$
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(in thousands, except per share and per ADS data)
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Revenues:
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Leased hotels
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626,738 | 846,687 | 831,104 | 133,401 | 2,172,934 | 3,069,431 | 492,678 | |||||||||||||||||||||
Manachised and franchised hotels
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63,183 | 100,955 | 105,561 | 16,944 | 212,644 | 349,847 | 56,154 | |||||||||||||||||||||
Total revenues
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689,921 | 947,642 | 936,665 | 150,345 | 2,385,578 | 3,419,278 | 548,832 | |||||||||||||||||||||
Less: business tax and related surcharges
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(39,184 | ) | (54,005 | ) | (53,468 | ) | (8,582 | ) | (135,981 | ) | (194,751 | ) | (31,260 | ) | ||||||||||||||
Net revenues
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650,737 | 893,637 | 883,197 | 141,763 | 2,249,597 | 3,224,527 | 517,572 | |||||||||||||||||||||
Operating costs and expenses: | ||||||||||||||||||||||||||||
Hotel operating costs:
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Rents
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(183,367 | ) | (235,729 | ) | (255,967 | ) | (41,085 | ) | (655,247 | ) | (916,357 | ) | (147,085 | ) | ||||||||||||||
Utilities
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(40,514 | ) | (53,340 | ) | (58,166 | ) | (9,336 | ) | (150,865 | ) | (215,768 | ) | (34,633 | ) | ||||||||||||||
Personnel costs
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(97,065 | ) | (128,840 | ) | (143,511 | ) | (23,035 | ) | (329,078 | ) | (505,773 | ) | (81,182 | ) | ||||||||||||||
Depreciation and amortization
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(66,611 | ) | (88,500 | ) | (93,929 | ) | (15,077 | ) | (227,938 | ) | (337,162 | ) | (54,118 | ) | ||||||||||||||
Consumables, food and beverage
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(70,341 | ) | (89,519 | ) | (94,190 | ) | (15,119 | ) | (228,244 | ) | (333,245 | ) | (53,490 | ) | ||||||||||||||
Others
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(35,921 | ) | (34,097 | ) | (48,312 | ) | (7,755 | ) | (111,965 | ) | (145,597 | ) | (23,370 | ) | ||||||||||||||
Total hotel operating costs
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(493,819 | ) | (630,025 | ) | (694,075 | ) | (111,407 | ) | (1,703,337 | ) | (2,453,902 | ) | (393,878 | ) | ||||||||||||||
Selling and marketing expenses
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(29,307 | ) | (24,316 | ) | (28,959 | ) | (4,648 | ) | (94,754 | ) | (102,814 | ) | (16,503 | ) | ||||||||||||||
General and administrative expenses
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(43,792 | ) | (55,734 | ) | (61,044 | ) | (9,798 | ) | (160,062 | ) | (217,388 | ) | (34,893 | ) | ||||||||||||||
Pre-opening expenses
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(49,460 | ) | (63,230 | ) | (69,835 | ) | (11,209 | ) | (184,298 | ) | (230,690 | ) | (37,028 | ) | ||||||||||||||
Total operating costs and expenses
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(616,378 | ) | (773,305 | ) | (853,913 | ) | (137,062 | ) | (2,142,451 | ) | (3,004,794 | ) | (482,302 | ) | ||||||||||||||
Income from operations
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34,359 | 120,332 | 29,284 | 4,701 | 107,146 | 219,733 | 35,270 | |||||||||||||||||||||
Interest income
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5,199 | 3,932 | 3,309 | 531 | 18,111 | 14,554 | 2,336 | |||||||||||||||||||||
Interest expenses
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(213 | ) | (200 | ) | (200 | ) | (32 | ) | (882 | ) | (822 | ) | (132 | ) | ||||||||||||||
Other income
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753 | 377 | 374 | 60 | 2,649 | 2,208 | 354 | |||||||||||||||||||||
Foreign exchange gain/(loss)
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2,734 | (248 | ) | 354 | 57 | 15,930 | (2,000 | ) | (321 | ) | ||||||||||||||||||
Income before income tax
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42,832 | 124,193 | 33,121 | 5,317 | 142,954 | 233,673 | 37,507 | |||||||||||||||||||||
Income tax expense
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(11,192 | ) | (26,289 | ) | (13,311 | ) | (2,137 | ) | (24,816 | ) | (54,169 | ) | (8,695 | ) | ||||||||||||||
Net income
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31,640 | 97,904 | 19,810 | 3,180 | 118,138 | 179,504 | 28,812 | |||||||||||||||||||||
Net income attributable to noncontrolling interests
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(1,340 | ) | (2,112 | ) | (1,618 | ) | (260 | ) | (3,306 | ) | (4,617 | ) | (741 | ) | ||||||||||||||
Net income attributable to China Lodging Group, Limited
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30,300 | 95,792 | 18,192 | 2,920 | 114,832 | 174,887 | 28,071 | |||||||||||||||||||||
Net earnings per share
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— Basic
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0.12 | 0.39 | 0.07 | 0.01 | 0.47 | 0.72 | 0.12 | |||||||||||||||||||||
— Diluted
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0.12 | 0.39 | 0.07 | 0.01 | 0.47 | 0.71 | 0.11 | |||||||||||||||||||||
Net earnings per ADS
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— Basic
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0.50 | 1.57 | 0.30 | 0.05 | 1.90 | 2.88 | 0.46 | |||||||||||||||||||||
— Diluted
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0.49 | 1.55 | 0.29 | 0.05 | 1.87 | 2.83 | 0.45 | |||||||||||||||||||||
Weighted average ordinary shares outstanding
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— Basic
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242,461 | 243,282 | 244,318 | 244,318 | 241,928 | 243,284 | 243,284 | |||||||||||||||||||||
— Diluted
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245,896 | 247,620 | 248,265 | 248,265 | 246,181 | 246,981 | 246,981 | |||||||||||||||||||||
Other comprehensive income/(loss), net of tax | ||||||||||||||||||||||||||||
Foreign currency translation adjustments
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(2,841 | ) | 126 | (760 | ) | (122 | ) | (16,463 | ) | 758 | 122 | |||||||||||||||||
Comprehensive income
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28,799 | 98,030 | 19,050 | 3,058 | 101,675 | 180,262 | 28,934 | |||||||||||||||||||||
Comprehensive income attributable to the noncontrolling interest
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(1,340 | ) | (2,112 | ) | (1,618 | ) | (260 | ) | (3,306 | ) | (4,617 | ) | (741 | ) | ||||||||||||||
Comprehensive income attributable to China Lodging Group, Limited
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27,459 | 95,918 | 17,432 | 2,798 | 98,369 | 175,645 | 28,193 |
China Lodging Group, Limited
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Unaudited Condensed Consolidated Statements of Cash Flows
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Quarter Ended
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Year Ended
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December 31, 2011
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September 30, 2012
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December 31, 2012
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December 31, 2011
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December 31, 2012
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RMB
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RMB
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RMB
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US$
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RMB
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RMB
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US$
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(in thousands)
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Operating activities:
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Net income
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31,640 | 97,904 | 19,810 | 3,180 | 118,138 | 179,504 | 28,812 | |||||||||||||||||||||
Adjustments to reconcile net income to net cash provided by operating activities:
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Share-based compensation
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2,858 | 7,789 | 5,103 | 819 | 15,483 | 20,837 | 3,345 | |||||||||||||||||||||
Depreciation and amortization
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70,328 | 90,991 | 96,834 | 15,543 | 236,857 | 347,575 | 55,790 | |||||||||||||||||||||
Deferred taxes
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(35,714 | ) | - | (18,226 | ) | (2,925 | ) | (35,714 | ) | (18,226 | ) | (2,925 | ) | |||||||||||||||
Bad debt expenses
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554 | 618 | (735 | ) | (118 | ) | 667 | 1,238 | 199 | |||||||||||||||||||
Deferred rent
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27,966 | 46,155 | 37,259 | 5,980 | 92,927 | 143,858 | 23,092 | |||||||||||||||||||||
Impairment loss
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710 | - | 4,549 | 730 | 710 | 5,349 | 859 | |||||||||||||||||||||
Excess tax benefit from share-based compensation
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(8,324 | ) | (2,865 | ) | (793 | ) | (127 | ) | (8,324 | ) | (4,302 | ) | (691 | ) | ||||||||||||||
Changes in operating assets and liabilities, net of effect of acquisitions:
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Accounts receivable
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(4,669 | ) | 2,129 | (1,773 | ) | (285 | ) | (16,401 | ) | (12,336 | ) | (1,980 | ) | |||||||||||||||
Prepaid rent
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(34,442 | ) | (21,382 | ) | (43,029 | ) | (6,907 | ) | (75,820 | ) | (93,218 | ) | (14,963 | ) | ||||||||||||||
Inventories
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(4,736 | ) | (1,198 | ) | (4,991 | ) | (801 | ) | (12,792 | ) | (6,714 | ) | (1,078 | ) | ||||||||||||||
Amount due from related parties
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- | - | - | - | 3,267 | - | - | |||||||||||||||||||||
Other current assets
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(14,701 | ) | 926 | (20,616 | ) | (3,309 | ) | (15,684 | ) | (29,404 | ) | (4,720 | ) | |||||||||||||||
Other assets
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176 | (7,705 | ) | (7,030 | ) | (1,128 | ) | (22,102 | ) | (31,482 | ) | (5,053 | ) | |||||||||||||||
Accounts payable
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(627 | ) | (1,775 | ) | 5,493 | 882 | 3,435 | 3,390 | 544 | |||||||||||||||||||
Amount due to related parties
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(290 | ) | (249 | ) | (366 | ) | (59 | ) | 175 | (229 | ) | (37 | ) | |||||||||||||||
Salary and welfare payables
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37,718 | (28,811 | ) | 57,914 | 9,296 | 22,628 | 36,809 | 5,906 | ||||||||||||||||||||
Deferred revenue
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26,549 | 27,299 | 23,108 | 3,709 | 92,803 | 90,468 | 14,521 | |||||||||||||||||||||
Accrued expenses and other current liabilities
|
169 | 14,927 | 7,425 | 1,192 | 34,246 | 36,076 | 5,791 | |||||||||||||||||||||
Income tax payable and receivable
|
34,290 | 8,621 | 22,078 | 3,544 | 7,350 | 13,296 | 2,134 | |||||||||||||||||||||
Other long-term liabilities
|
5,469 | 9,448 | 9,348 | 1,500 | 16,891 | 33,231 | 5,334 | |||||||||||||||||||||
Net cash provided by operating activities
|
134,924 | 242,822 | 191,362 | 30,716 | 458,740 | 715,720 | 114,880 | |||||||||||||||||||||
Investing activities:
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Purchase of property and equipment
|
(208,746 | ) | (278,226 | ) | (263,764 | ) | (42,337 | ) | (768,756 | ) | (998,050 | ) | (160,198 | ) | ||||||||||||||
Purchases of intangibles
|
(13,037 | ) | (527 | ) | (1,936 | ) | (311 | ) | (14,674 | ) | (3,532 | ) | (567 | ) | ||||||||||||||
Amount received as a result of government zoning
|
- | - | - | - | 6,900 | - | - | |||||||||||||||||||||
Acquisitions, net of cash received
|
(9,540 | ) | (3,040 | ) | (510 | ) | (82 | ) | (57,822 | ) | (30,055 | ) | (4,824 | ) | ||||||||||||||
Payment to acquire investment
|
- | - | - | - | - | (28,129 | ) | (4,515 | ) | |||||||||||||||||||
Purchase of short term investment
|
- | - | (8,074 | ) | (1,296 | ) | (30,000 | ) | (8,074 | ) | (1,296 | ) | ||||||||||||||||
Proceeds from sales of short-term investments
|
30,000 | - | - | - | 130,000 | - | - | |||||||||||||||||||||
Decrease (increase) in restricted cash
|
4,000 | (46,500 | ) | 59,665 | 9,577 | (225 | ) | (290 | ) | (47 | ) | |||||||||||||||||
Net cash used in investing activities
|
(197,323 | ) | (328,293 | ) | (214,619 | ) | (34,449 | ) | (734,577 | ) | (1,068,130 | ) | (171,447 | ) | ||||||||||||||
Financing activities:
|
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Net proceeds from issuance of ordinary shares upon exercise of option
|
2,076 | 7,770 | 6,017 | 966 | 7,285 | 18,520 | 2,973 | |||||||||||||||||||||
Proceeds from long-term bank loans
|
- | - | - | - | - | 1,000 | 161 | |||||||||||||||||||||
Repayment of long term debt
|
- | (90 | ) | (880 | ) | (141 | ) | - | (1,000 | ) | (161 | ) | ||||||||||||||||
Funds advanced from noncontrolling shareholders
|
- | - | 3,000 | 482 | 3,485 | 3,000 | 482 | |||||||||||||||||||||
Repayment of funds advanced from noncontrolling interest holders
|
(533 | ) | (674 | ) | (621 | ) | (100 | ) | (2,568 | ) | (2,681 | ) | (430 | ) | ||||||||||||||
Contribution from noncontrolling interest holders
|
- | 210 | 25 | 4 | 459 | 240 | 39 | |||||||||||||||||||||
Dividend paid to noncontrolling interest holders
|
(127 | ) | (183 | ) | (168 | ) | (27 | ) | (3,151 | ) | (3,486 | ) | (560 | ) | ||||||||||||||
Excess tax benefit from share-based compensation
|
8,324 | 2,865 | 793 | 127 | 8,324 | 4,302 | 691 | |||||||||||||||||||||
Net cash provided by (used in) financing activities
|
9,740 | 9,898 | 8,166 | 1,311 | 13,834 | 19,895 | 3,195 | |||||||||||||||||||||
Effect of exchange rate changes on cash and cash equivalents
|
(2,841 | ) | 125 | (760 | ) | (122 | ) | (16,463 | ) | 758 | 122 | |||||||||||||||||
Net increase (decrease) in cash and cash equivalents
|
(55,500 | ) | (75,448 | ) | (15,851 | ) | (2,544 | ) | (278,466 | ) | (331,757 | ) | (53,251 | ) | ||||||||||||||
Cash and cash equivalents, beginning of period
|
837,101 | 541,143 | 465,695 | 74,749 | 1,060,067 | 781,601 | 125,456 | |||||||||||||||||||||
Cash and cash equivalents, end of period
|
781,601 | 465,695 | 449,844 | 72,205 | 781,601 | 449,844 | 72,205 |
China Lodging Group, Limited
|
||||||||||||||||||||||||
Unaudited reconciliation of GAAP and Non-GAAP Results
|
||||||||||||||||||||||||
Quarter Ended December 31, 2012
|
||||||||||||||||||||||||
GAAP Result
|
% of Net Revenues
|
Share-based Compensation
|
% of Net Revenues
|
Non-GAAP Result
|
% of Net Revenues
|
|||||||||||||||||||
RMB
|
RMB
|
RMB
|
||||||||||||||||||||||
(in thousands)
|
||||||||||||||||||||||||
Hotel operating costs
|
694,075 | 78.6 | % | 318 | 0.0 | % | 693,757 | 78.6 | % | |||||||||||||||
Selling and marketing expenses
|
28,959 | 3.3 | % | 164 | 0.0 | % | 28,795 | 3.3 | % | |||||||||||||||
General and administrative expenses
|
61,044 | 6.9 | % | 4,621 | 0.5 | % | 56,423 | 6.4 | % | |||||||||||||||
Pre-opening expenses
|
69,835 | 7.9 | % | - | 0.0 | % | 69,835 | 7.9 | % | |||||||||||||||
Total operating costs and expenses
|
853,913 | 96.7 | % | 5,103 | 0.5 | % | 848,810 | 96.2 | % | |||||||||||||||
Income from operations
|
29,284 | 3.3 | % | 5,103 | 0.5 | % | 34,387 | 3.8 | % | |||||||||||||||
Quarter Ended December 31, 2012
|
||||||||||||||||||||||||
GAAP Result
|
% of Net Revenues
|
Share-based Compensation
|
% of Net Revenues
|
Non-GAAP Result
|
% of Net Revenues
|
|||||||||||||||||||
US$
|
US$
|
US$
|
||||||||||||||||||||||
(in thousands)
|
||||||||||||||||||||||||
Hotel operating costs
|
111,407 | 78.6 | % | 51 | 0.0 | % | 111,356 | 78.6 | % | |||||||||||||||
Selling and marketing expenses
|
4,648 | 3.3 | % | 26 | 0.0 | % | 4,622 | 3.3 | % | |||||||||||||||
General and administrative expenses
|
9,798 | 6.9 | % | 742 | 0.5 | % | 9,056 | 6.4 | % | |||||||||||||||
Pre-opening expenses
|
11,209 | 7.9 | % | - | 0.0 | % | 11,209 | 7.9 | % | |||||||||||||||
Total operating costs and expenses
|
137,062 | 96.7 | % | 819 | 0.5 | % | 136,243 | 96.2 | % | |||||||||||||||
Income from operations
|
4,701 | 3.3 | % | 819 | 0.5 | % | 5,520 | 3.8 | % | |||||||||||||||
Quarter Ended September 30, 2012
|
||||||||||||||||||||||||
GAAP Result
|
% of Net Revenues
|
Share-based Compensation
|
% of Net Revenues
|
Non-GAAP Result
|
% of Net Revenues
|
|||||||||||||||||||
RMB
|
RMB
|
RMB
|
||||||||||||||||||||||
(in thousands)
|
||||||||||||||||||||||||
Hotel operating costs
|
630,025 | 70.5 | % | 1,029 | 0.1 | % | 628,996 | 70.4 | % | |||||||||||||||
Selling and marketing expenses
|
24,316 | 2.7 | % | 289 | 0.0 | % | 24,027 | 2.7 | % | |||||||||||||||
General and administrative expenses
|
55,734 | 6.2 | % | 6,471 | 0.7 | % | 49,263 | 5.5 | % | |||||||||||||||
Pre-opening expenses
|
63,230 | 7.1 | % | - | 0.0 | % | 63,230 | 7.1 | % | |||||||||||||||
Total operating costs and expenses
|
773,305 | 86.5 | % | 7,789 | 0.8 | % | 765,516 | 85.7 | % | |||||||||||||||
Income/(Loss) from operations
|
120,332 | 13.5 | % | 7,789 | 0.8 | % | 128,121 | 14.3 | % | |||||||||||||||
Quarter Ended December 31, 2011
|
||||||||||||||||||||||||
GAAP Result
|
% of Net Revenues
|
Share-based Compensation
|
% of Net Revenues
|
Non-GAAP Result
|
% of Net Revenues
|
|||||||||||||||||||
RMB
|
RMB
|
RMB
|
||||||||||||||||||||||
(in thousands)
|
||||||||||||||||||||||||
Hotel operating costs
|
493,819 | 75.9 | % | 536 | 0.1 | % | 493,283 | 75.8 | % | |||||||||||||||
Selling and marketing expenses
|
29,307 | 4.5 | % | 178 | 0.0 | % | 29,129 | 4.5 | % | |||||||||||||||
General and administrative expenses
|
43,792 | 6.7 | % | 2,144 | 0.3 | % | 41,648 | 6.4 | % | |||||||||||||||
Pre-opening expenses
|
49,460 | 7.6 | % | - | 0.0 | % | 49,460 | 7.6 | % | |||||||||||||||
Total operating costs and expenses
|
616,378 | 94.7 | % | 2,858 | 0.4 | % | 613,520 | 94.3 | % | |||||||||||||||
Income from operations
|
34,359 | 5.3 | % | 2,858 | 0.4 | % | 37,217 | 5.7 | % | |||||||||||||||
Year Ended December 31, 2012
|
||||||||||||||||||||||||
GAAP Result
|
% of Net Revenues
|
Share-based Compensation
|
% of Net Revenues
|
Non-GAAP Result
|
% of Net Revenues
|
|||||||||||||||||||
RMB
|
RMB
|
RMB
|
||||||||||||||||||||||
(in thousands)
|
||||||||||||||||||||||||
Hotel operating costs
|
2,453,902 | 76.1 | % | 2,592 | 0.1 | % | 2,451,310 | 76.0 | % | |||||||||||||||
Selling and marketing expenses
|
102,814 | 3.2 | % | 1,031 | 0.0 | % | 101,783 | 3.2 | % | |||||||||||||||
General and administrative expenses
|
217,388 | 6.7 | % | 17,214 | 0.5 | % | 200,174 | 6.2 | % | |||||||||||||||
Pre-opening expenses
|
230,690 | 7.2 | % | - | 0.0 | % | 230,690 | 7.2 | % | |||||||||||||||
Total operating costs and expenses
|
3,004,794 | 93.2 | % | 20,837 | 0.6 | % | 2,983,957 | 92.6 | % | |||||||||||||||
Income from operations
|
219,733 | 6.8 | % | 20,837 | 0.6 | % | 240,570 | 7.4 | % | |||||||||||||||
Year Ended December 31, 2012
|
||||||||||||||||||||||||
GAAP Result
|
% of Net Revenues
|
Share-based Compensation
|
% of Net Revenues
|
Non-GAAP Result
|
% of Net Revenues
|
|||||||||||||||||||
US$
|
US$
|
US$
|
||||||||||||||||||||||
(in thousands)
|
||||||||||||||||||||||||
Hotel operating costs
|
393,878 | 76.1 | % | 416 | 0.1 | % | 393,462 | 76.0 | % | |||||||||||||||
Selling and marketing expenses
|
16,503 | 3.2 | % | 166 | 0.0 | % | 16,337 | 3.2 | % | |||||||||||||||
General and administrative expenses
|
34,893 | 6.7 | % | 2,763 | 0.5 | % | 32,130 | 6.2 | % | |||||||||||||||
Pre-opening expenses
|
37,028 | 7.2 | % | - | 0.0 | % | 37,028 | 7.2 | % | |||||||||||||||
Total operating costs and expenses
|
482,302 | 93.2 | % | 3,345 | 0.6 | % | 478,957 | 92.6 | % | |||||||||||||||
Income from operations
|
35,270 | 6.8 | % | 3,345 | 0.6 | % | 38,615 | 7.4 | % | |||||||||||||||
Year Ended December 31, 2011
|
||||||||||||||||||||||||
GAAP Result
|
% of Net Revenues
|
Share-based Compensation
|
% of Net Revenues
|
Non-GAAP Result
|
% of Net Revenues
|
|||||||||||||||||||
RMB
|
RMB
|
RMB
|
||||||||||||||||||||||
(in thousands)
|
||||||||||||||||||||||||
Hotel operating costs
|
1,703,337 | 75.7 | % | 2,115 | 0.1 | % | 1,701,222 | 75.6 | % | |||||||||||||||
Selling and marketing expenses
|
94,754 | 4.2 | % | 783 | 0.0 | % | 93,971 | 4.2 | % | |||||||||||||||
General and administrative expenses
|
160,062 | 7.1 | % | 12,585 | 0.6 | % | 147,477 | 6.5 | % | |||||||||||||||
Pre-opening expenses
|
184,298 | 8.2 | % | - | 0.0 | % | 184,298 | 8.2 | % | |||||||||||||||
Total operating costs and expenses
|
2,142,451 | 95.2 | % | 15,483 | 0.7 | % | 2,126,968 | 94.5 | % | |||||||||||||||
Income from operations
|
107,146 | 4.8 | % | 15,483 | 0.7 | % | 122,629 | 5.5 | % |
China Lodging Group, Limited
|
||||||||||||||||||||||||||||
Unaudited reconciliation of GAAP and Non-GAAP Results
|
||||||||||||||||||||||||||||
Quarter Ended
|
Year Ended
|
|||||||||||||||||||||||||||
December 31, 2011
|
September 30, 2012
|
December 31, 2012
|
December 31, 2011
|
December 31, 2012
|
||||||||||||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
RMB
|
RMB
|
US$
|
||||||||||||||||||||||
(in thousands, except per share and per ADS data)
|
||||||||||||||||||||||||||||
Net income attributable to China Lodging Group, Limited (GAAP)
|
30,300 | 95,792 | 18,192 | 2,920 | 114,832 | 174,887 | 28,071 | |||||||||||||||||||||
Share-based compensation expenses
|
2,858 | 7,789 | 5,103 | 819 | 15,483 | 20,837 | 3,345 | |||||||||||||||||||||
Adjusted net income attributable to China Lodging Group, Limited (non-GAAP)
|
33,158 | 103,581 | 23,295 | 3,739 | 130,315 | 195,724 | 31,416 | |||||||||||||||||||||
Net earnings per share (GAAP)
|
||||||||||||||||||||||||||||
— Basic
|
0.12 | 0.39 | 0.07 | 0.01 | 0.47 | 0.72 | 0.12 | |||||||||||||||||||||
— Diluted
|
0.12 | 0.39 | 0.07 | 0.01 | 0.47 | 0.71 | 0.11 | |||||||||||||||||||||
Net earnings per ADS (GAAP)
|
||||||||||||||||||||||||||||
— Basic
|
0.50 | 1.57 | 0.30 | 0.05 | 1.90 | 2.88 | 0.46 | |||||||||||||||||||||
— Diluted
|
0.49 | 1.55 | 0.29 | 0.05 | 1.87 | 2.83 | 0.45 | |||||||||||||||||||||
Adjusted net earnings per share (non-GAAP)
|
||||||||||||||||||||||||||||
— Basic
|
0.14 | 0.43 | 0.10 | 0.02 | 0.54 | 0.80 | 0.13 | |||||||||||||||||||||
— Diluted
|
0.13 | 0.42 | 0.09 | 0.02 | 0.53 | 0.79 | 0.13 | |||||||||||||||||||||
Adjusted net earnings per ADS (non-GAAP)
|
||||||||||||||||||||||||||||
— Basic
|
0.55 | 1.70 | 0.38 | 0.06 | 2.15 | 3.22 | 0.52 | |||||||||||||||||||||
— Diluted
|
0.54 | 1.67 | 0.38 | 0.06 | 2.12 | 3.17 | 0.51 | |||||||||||||||||||||
Weighted average ordinary shares outstanding
|
||||||||||||||||||||||||||||
— Basic
|
242,461 | 243,282 | 244,318 | 244,318 | 241,928 | 243,284 | 243,284 | |||||||||||||||||||||
— Diluted
|
245,896 | 247,620 | 248,265 | 248,265 | 246,181 | 246,981 | 246,981 | |||||||||||||||||||||
Quarter Ended
|
Year Ended
|
|||||||||||||||||||||||||||
December 31, 2011
|
September 30, 2012
|
December 31, 2012
|
December 31, 2011
|
December 31, 2012
|
||||||||||||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
RMB
|
RMB
|
US$
|
||||||||||||||||||||||
(in thousands)
|
||||||||||||||||||||||||||||
Net income attributable to China Lodging Group, Limited (GAAP)
|
30,300 | 95,792 | 18,192 | 2,920 | 114,832 | 174,887 | 28,071 | |||||||||||||||||||||
Interest expenses
|
213 | 200 | 200 | 32 | 882 | 822 | 132 | |||||||||||||||||||||
Income tax expense
|
11,192 | 26,289 | 13,311 | 2,137 | 24,816 | 54,169 | 8,695 | |||||||||||||||||||||
Depreciation and amortization
|
70,328 | 90,991 | 96,834 | 15,543 | 236,857 | 347,575 | 55,790 | |||||||||||||||||||||
EBITDA (non-GAAP)
|
112,033 | 213,272 | 128,537 | 20,632 | 377,387 | 577,453 | 92,688 | |||||||||||||||||||||
Pre-opening expenses
|
49,460 | 63,230 | 69,835 | 11,209 | 184,298 | 230,690 | 37,028 | |||||||||||||||||||||
Share-based Compensation
|
2,858 | 7,789 | 5,103 | 819 | 15,483 | 20,837 | 3,345 | |||||||||||||||||||||
Adjusted EBITDA from operating hotels (non-GAAP)
|
164,351 | 284,291 | 203,475 | 32,660 | 577,168 | 828,980 | 133,061 | |||||||||||||||||||||
Quarter Ended
|
Year Ended
|
|||||||||||||||||||||||||||
December 31, 2011
|
September 30, 2012
|
December 31, 2012
|
December 31, 2011
|
December 31, 2012
|
||||||||||||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
RMB
|
RMB
|
US$
|
||||||||||||||||||||||
(in thousands)
|
||||||||||||||||||||||||||||
Net revenues (GAAP)
|
650,737 | 893,637 | 883,197 | 141,763 | 2,249,597 | 3,224,527 | 517,572 | |||||||||||||||||||||
Less: Hotel operating costs
|
(493,819 | ) | (630,025 | ) | (694,075 | ) | (111,407 | ) | (1,703,337 | ) | (2,453,902 | ) | (393,878 | ) | ||||||||||||||
Hotel income (non-GAAP)
|
156,918 | 263,612 | 189,122 | 30,356 | 546,260 | 770,625 | 123,694 |
China Lodging Group, Limited
|
||||||||||||
Operating Data
|
||||||||||||
As of
|
||||||||||||
December 31,
2011 |
September 30,
2012 |
December 31,
2012 |
||||||||||
Total hotels in operation:
|
639 | 938 | 1,035 | |||||||||
Leased hotels
|
344 | 415 | 465 | |||||||||
Manachised hotels
|
295 | 446 | 516 | |||||||||
Franchised hotels*
|
- | 77 | 54 | |||||||||
Total hotel rooms in operation
|
71,621 | 103,322 | 113,650 | |||||||||
Leased hotels
|
40,514 | 48,857 | 54,694 | |||||||||
Manachised hotels
|
31,107 | 46,296 | 53,381 | |||||||||
Franchised hotels*
|
- | 8,169 | 5,575 | |||||||||
Number of cities
|
100 | 149 | 171 | |||||||||
* refers to franchised Starway hotels
|
||||||||||||
Hotel breakdown by brand
|
As of
|
|||||||||||
December 31,
2011 |
September 30,
2012 |
December 31,
2012 |
||||||||||
Total hotels in operation:
|
639 | 938 | 1,035 | |||||||||
Ji Hotel (previously Seasons Hotel)
|
22 | 26 | 32 | |||||||||
Hanting Hotel
|
589 | 795 | 898 | |||||||||
Hi Inn
|
28 | 35 | 40 | |||||||||
Starway Hotel
|
- | 82 | 65 | |||||||||
For the quarter ended
|
||||||||||||
December 31,
2011 |
September 30,
2012 |
December 31,
2012 |
||||||||||
Occupancy rate (as a percentage)
|
||||||||||||
Leased hotels
|
92 | % | 97 | % | 92 | % | ||||||
Manachised hotels
|
95 | % | 98 | % | 92 | % | ||||||
Blended
|
93 | % | 97 | % | 92 | % | ||||||
Average daily room rate (in RMB)
|
||||||||||||
Leased hotels
|
184 | 188 | 182 | |||||||||
Manachised hotels
|
173 | 177 | 170 | |||||||||
Blended
|
179 | 183 | 176 | |||||||||
RevPAR (in RMB)
|
||||||||||||
Leased hotels
|
170 | 183 | 167 | |||||||||
Manachised hotels
|
164 | 173 | 157 | |||||||||
Blended
|
167 | 178 | 162 | |||||||||
Like-for-like performance for leased and manachised hotels opened for at least 18 months during the current quarter
|
||||||||||||
As of and for the quarter ended
|
||||||||||||
December 31,
|
||||||||||||
2011 | 2012 | |||||||||||
Total
|
508 | 508 | ||||||||||
Leased hotels
|
278 | 278 | ||||||||||
Manachised hotels
|
230 | 230 | ||||||||||
Total
|
59,313 | 59,313 | ||||||||||
Leased hotels
|
34,431 | 34,431 | ||||||||||
Manachised hotels
|
24,882 | 24,882 | ||||||||||
Occupancy rate (as a percentage)
|
96 | % | 97 | % | ||||||||
Average daily rate (in RMB)
|
182 | 185 | ||||||||||
RevPAR (in RMB)
|
175 | 179 |