Trip.com Group Limited Reports Unaudited First Quarter of 2022 Financial Results

Rhea-AI Summary

Trip.com Group (Nasdaq: TCOM) reported stable net revenue of RMB4.1 billion (US$649 million) for Q1 2022, flat year-over-year but down 12% from Q4 2021. Despite pandemic challenges in China, local hotel bookings rose over 20% year-over-year, and air-ticket bookings surged by 270% globally. Accommodation and corporate travel revenues decreased by 8% and 12%, respectively. The company showed resilience with a narrower operating loss of RMB359 million (US$55 million), down from RMB787 million a year ago, alongside a positive adjusted EBITDA of RMB91 million (US$16 million).

Positive

• Local hotel bookings increased by over 20% year-over-year.
• Global air-ticket bookings increased by over 270% year-over-year.
• Adjusted EBITDA of RMB91 million (US$16 million) for Q1 2022, compared to a loss last year.

Negative

• Net revenue decreased by 12% quarter-over-quarter.
• Accommodation reservation revenue down 8% year-over-year and 24% from the previous quarter.
• Corporate travel revenue fell 12% year-over-year and 40% from the previous quarter.

SHANGHAI, June 27, 2022  /PRNewswire/ -- Trip.com Group Limited (Nasdaq: TCOM; HKEX: 9961) ("Trip.com Group" or the "Company"), a leading one-stop travel service provider of accommodation reservation, transportation ticketing, packaged tours and corporate travel management, today announced its unaudited financial results for the first quarter of 2022.

Key Highlights for the First Quarter of 2022

The Company delivered resilient results in the first quarter despite the disruptions of the COVID-19 resurgence in China.

• Net revenue for the first quarter remained stable year-over-year and decreased by 12% quarter-over-quarter, mainly due to the impact from the latest wave of COVID-19 resurgence in China.
• Staycation travel continued to serve as a major contributor to the recovery of the Chinese domestic market, with local hotel bookings increased by over 20% year-over-year.
• Air-ticket bookings on global platforms increased by over 270% year-over-year, mainly driven by the recovery of European and Asian Pacific markets. Hotel bookings on our global platforms also outgrew the pre-pandemic level.

"In the first quarter, we are encouraged to see solid growth of travel demand in the global markets, especially across Europe and the Asia Pacific, as more countries started to ease travel restrictions," said James Liang, Executive Chairman. "We are keen to build on these positive signals to further strengthen our market position and fortify our globalization footprints."

"Though it was challenging for domestic travel due to the COVID-19 resurgence in China during the first quarter, our results demonstrated our resilience amidst a confluence of challenges and uncertainties," said Jane Sun, Chief Executive Officer. "While we may continue to see short-term fluctuations, demand for travel is still strong and shows a bright outlook in the long-term. We will remain adaptive to embrace the changing environment and be flexible with our strategies to swiftly seize growth opportunities."

First Quarter of 2022 Financial Results and Business Updates

In the first quarter of 2022, the COVID-19 resurgence continued to disrupt the travel industry in China, which discouraged user demand for the Company's services. As a result, the Company's results of operations for the first quarter of 2022 were materially and adversely affected.

For the first quarter of 2022, Trip.com Group reported net revenue of RMB4.1 billion (US$649 million), which was flat comparing to the same period in 2021. Net revenue for the first quarter of 2022 decreased by 12% from the previous quarter, primarily due to the continued disruptions resulting from the COVID-19 resurgence in China.

Accommodation reservation revenue for the first quarter of 2022 was RMB1.5 billion (US$229 million), representing an 8% decrease from the same period in 2021, and a 24% decrease from the previous quarter, primarily due to the continued disruptions resulting from the COVID-19 resurgence in China.

Transportation ticketing revenue for the first quarter of 2022 was RMB1.7 billion (US$262 million), representing a 10% increase from the same period in 2021 and a 10% increase from the previous quarter, primarily driven by strong recovery of air travel in the oversea market.

Packaged-tour revenue for the first quarter of 2022 was RMB124 million (US$20 million), representing a 27% decrease from the same period in 2021 and a 30% decrease from the previous quarter, primarily due to the continued disruptions resulting from the COVID-19 resurgence in China.

Corporate travel revenue for the first quarter of 2022 was RMB222 million (US$35 million), representing a 12% decrease from the same period in 2021 and a 40% decrease from the previous quarter, primarily due to the continued disruptions resulting from the COVID-19 resurgence in China.

Cost of revenue for the first quarter of 2022 was relatively stable at RMB1.1 billion (US$168 million) comparing to the same period in 2021. Cost of revenue decreased by 5% from the previous quarter. Cost of revenue as a percentage of net revenue was 26% for the first quarter of 2022.

Product development expenses for the first quarter of 2022 decreased by 11% to RMB2.0 billion (US$311 million) from the same period in 2021 and decreased by 12% from the previous quarter, primarily due to a decrease in product development personnel related expenses. Product development expenses as a percentage of net revenue was 48% for the first quarter of 2022.

Sales and marketing expenses for the first quarter of 2022 decreased by 11% to RMB843 million (US$133 million) from the same period in 2021 and decreased by 35% from the previous quarter, primarily due to a decrease in expenses relating to sales and marketing promotion activities. Sales and marketing expenses as a percentage of net revenue was 21% for the first quarter of 2022.

General and administrative expenses for the first quarter of 2022 decreased by 15% to RMB584 million (US$92 million) from the same period in 2021 and decreased by 20% from the previous quarter, primarily due to a decrease in general and administrative personnel related expenses. General and administrative expenses as a percentage of net revenue was 14% for the first quarter of 2022.

Loss from operations for the first quarter of 2022 was RMB359 million (US$55 million), compared to loss from operations of RMB787 million for the same period in 2021 and loss from operations of RMB704 million for the previous quarter. Adjusted EBITDA for the first quarter of 2022 was RMB91 million (US$16 million), compared to RMB-216 million for the same period in 2021 and RMB54 million for the previous quarter. Adjusted EBITDA margin was 2% for the first quarter of 2022, compared to -5% for the same period in 2021 and 1% for the previous quarter.

Income tax benefit for the first quarter of 2022 was RMB14 million (US$2 million), compared to income tax expense of RMB41 million for the same period in 2021 and income tax expense of RMB37 million in the previous quarter. The change in our effective tax rate was primarily due to the combined impacts of changes in respective profitability of our subsidiaries with different tax rates, certain non-taxable income or loss resulting from the fair value changes in equity securities investments and exchangeable senior notes, and changes in valuation allowance provided for deferred tax assets.

Net loss attributable to Trip.com Group's shareholders for the first quarter of 2022 was RMB989 million (US$155 million), compared to net income attributable to Trip.com Group's shareholders of RMB1.8 billion for the same period in 2021 and net loss attributable to Trip.com Group's shareholders of RMB834 million for the previous quarter. Excluding share-based compensation charges and fair value changes of equity securities investments and exchangeable senior notes recorded in other income/(expense), non-GAAP net loss attributable to Trip.com Group's shareholders was RMB36 million (US$5 million), compared to non-GAAP net loss attributable to Trip.com Group's shareholders of RMB204 million in the same period in 2021 and non-GAAP net income attributable to Trip.com Group's shareholders of RMB309 million for the previous quarter.

Diluted loss per ordinary share and per ADS was RMB1.52 (US$0.24) for the first quarter of 2022. Excluding share-based compensation charges and fair value changes of equity securities investments and exchangeable senior notes, non-GAAP diluted loss per ordinary share and per ADS was RMB0.06 (US$0.01) for the first quarter of 2022. Each ADS currently represents one ordinary share of the Company.

As of March 31, 2022, the balance of cash and cash equivalents, restricted cash, short-term investment, held to maturity time deposit and financial products was RMB63.3 billion (US$10.0 billion).

Conference Call

Trip.com Group's management team will host a conference call at 8:00PM EST on June 27, 2022 (or 8:00AM CST on June 28, 2022) following this announcement.

The conference call will be available live on Webcast and for replay at: https://investors.trip.com. The call will be archived for twelve months on our website.

All participants must pre-register to join this conference call using the Participant Registration link below:
https://s1.c-conf.com/diamondpass/10022620-VWCVi9.html

Upon registration, each participant will receive details for this conference call, including dial-in numbers, passcode and a unique access PIN. To join the conference, please dial the number provided, enter the passcode, followed by your PIN.

A telephone replay of the call will be available after the conclusion of the conference call until July 5, 2022.

The dial-in details for the replay:
International dial-in number: +61-7-3107-6325
Passcode: 10022620

Safe Harbor Statement

This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "may," "will," "expect," "anticipate," "future," "intend," "plan," "believe," "estimate," "is/are likely to," "confident" or other similar statements. Among other things, quotations from management in this press release, as well as Trip.com Group's strategic and operational plans, contain forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of important factors could cause actual results to differ materially from those contained in any forward-looking statement. Potential risks and uncertainties include, but are not limited to, severe or prolonged downturn in the global or Chinese economy, general declines or disruptions in the travel industry, the impact of COVID-19 pandemic to Trip.com Group's business operations, volatility in the trading price of Trip.com Group's ADSs or shares, Trip.com Group's reliance on its relationships and contractual arrangements with travel suppliers and strategic alliances, failure to compete against new and existing competitors, failure to successfully manage current growth and potential future growth, risks associated with any strategic investments or acquisitions, seasonality in the travel industry in the relevant jurisdictions where Trip.com Group operates, failure to successfully develop Trip.com Group's existing or future business lines, damage to or failure of Trip.com Group's infrastructure and technology, loss of services of Trip.com Group's key executives, adverse changes in economic and political policies of the PRC government, inflation in China, risks and uncertainties associated with PRC laws and regulations with respect to the ownership structure of Trip.com Group's affiliated Chinese entities and the contractual arrangements among Trip.com Group, its affiliated Chinese entities and their shareholders, and other risks outlined in Trip.com Group's filings with the U.S. Securities and Exchange Commission or the Stock Exchange of Hong Kong Limited. All information provided in this press release and in the attachments is as of the date of the issuance, and Trip.com Group does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

About Non-GAAP Financial Measures

To supplement Trip.com Group's unaudited condensed consolidated financial statements presented in accordance with United States Generally Accepted Accounting Principles ("GAAP"), Trip.com Group uses non-GAAP financial information related to adjusted net income attributable to Trip.com Group Limited, adjusted EBITDA, adjusted EBITDA margin and adjusted diluted earnings per ordinary share and per ADS, each of which is adjusted from the most comparable GAAP result to exclude the share-based compensation charges that are not tax deductible and fair value changes of equity securities investments and exchangeable senior notes, net of tax. Trip.com Group's management believes the non-GAAP financial measures facilitate better understanding of operating results from quarter to quarter and provide management with a better capability to plan and forecast future periods.

Non-GAAP information is not prepared in accordance with GAAP, does not have a standardized meaning under GAAP, and may be different from non-GAAP methods of accounting and reporting used by other companies. The presentation of this additional information should not be considered a substitute for GAAP results. A limitation of using non-GAAP financial measures is that non-GAAP measures exclude share-based compensation charges and fair value changes of equity securities investments and exchangeable senior notes that have been and will continue to be significant recurring expenses in Trip.com Group's business for the foreseeable future.

Reconciliations of Trip.com Group's non-GAAP financial data to the most comparable GAAP data included in the consolidated statement of operations are included at the end of this press release.

About Trip.com Group Limited

Trip.com Group Limited (Nasdaq: TCOM; HKEX: 9961) is a leading global one-stop travel platform, integrating a comprehensive suite of travel products and services and differentiated travel content. It is the go-to destination for travelers in China, and increasingly for travelers around the world, to explore travel, get inspired, make informed and cost-effective travel bookings, enjoy hassle-free on-the-go support, and share travel experience. Founded in 1999 and listed on Nasdaq in 2003 and HKEX in 2021, the Company currently operates under a portfolio of brands, including Ctrip, Qunar, Trip.com and Skyscanner, with the mission "to pursue the perfect trip for a better world."

For further information, please contact:

Investor Relations
Trip.com Group Limited
Tel: +86 (21) 3406-4880 X 12229
Email: iremail@trip.com

 

Trip.com Group Limited
Unaudited Consolidated Balance Sheets
(In millions, except share and per share data)
			December 31, 2021		March 31, 2022		March 31, 2022
			RMB (million)		RMB (million)		USD (million)
			(unaudited)		(unaudited)		(unaudited)
	ASSETS
	Current assets:
	Cash, cash equivalents and restricted cash		21,196		20,861		3,291
	Short-term investments		29,566		30,369		4,791
	Accounts receivable, net		4,649		3,979		628
	Prepayments and other current assets		10,697		9,274		1,463
	Total current assets		66,108		64,483		10,173
	Property, equipment and software		5,534		5,407		853
	Intangible assets and land use rights		13,046		12,991		2,049
	Right-of-use assets		777		689		109
	Investments (Includes held to maturity time deposit and financial products of RMB13,112 million and RMB12,022 million as of December 31,2021 and March 31, 2022, respectively)		44,961		42,668		6,731
	Goodwill		59,353		59,353		9,363
	Other long-term assets		396		399		63
	Deferred tax asset		1,684		1,828		288
	Total assets		191,859		187,818		29,629
	LIABILITIES
	Current liabilities:
	Short-term debt and current portion of long-term debt		39,866		30,870		4,870
	Accounts payable		6,019		4,201		663
	Advances from customers		7,535		6,857		1,082
	Other current liabilities		12,798		11,888		1,875
	Total current liabilities		66,218		53,816		8,490
	Deferred tax liability		3,527		3,504		553
	Long-term debt		11,093		20,302		3,203
	Long-term lease liability		400		367		58
	Other long-term liabilities		165		154		24
	Total liabilities		81,403		78,143		12,328
	SHAREHOLDERS' EQUITY
	Total Trip.com Group Limited shareholders' equity		109,677		108,913		17,181
	Non-controlling interests		779		762		120
	Total shareholders' equity		110,456		109,675		17,301
	Total liabilities and shareholders' equity		191,859		187,818		29,629

 

Trip.com Group Limited
Unaudited Consolidated Statements of Income/(Loss)
(In millions, except share and per share data)
			Quarter ended		Quarter ended		Quarter ended		Quarter ended
			March 31, 2021		December 31, 2021		March 31, 2022		March 31, 2022
			RMB (million)		RMB (million)		RMB (million)		USD (million)
			(unaudited)		(unaudited)		(unaudited)		(unaudited)
	Revenue:
	Accommodation reservation		1,580		1,919		1,450		229
	Transportation ticketing		1,506		1,516		1,663		262
	Packaged-tour		169		177		124		20
	Corporate travel		252		367		222		35
	Others		602		703		652		103
	Total revenue		4,109		4,682		4,111		649
	Less: Sales tax and surcharges		(1)		(1)		(2)		(0)
	Net revenue		4,108		4,681		4,109		649
	Cost of revenue		(1,034)		(1,118)		(1,067)		(168)
	Gross profit		3,074		3,563		3,042		481
	Operating expenses:
	Product development *		(2,225)		(2,236)		(1,974)		(311)
	Sales and marketing *		(952)		(1,298)		(843)		(133)
	General and administrative *		(684)		(733)		(584)		(92)
	Total operating expenses		(3,861)		(4,267)		(3,401)		(536)
	Loss from operations		(787)		(704)		(359)		(55)
	Interest income		418		757		591		93
	Interest expense		(407)		(358)		(341)		(54)
	Other income/(expense)		2,508		(433)		(707)		(112)
	Income/(Loss) before income tax expense and equity in income of affiliates		1,732		(738)		(816)		(128)
	Income tax (expense)/benefit		(41)		(37)		14		2
	Equity in income/(loss) of affiliates		74		(108)		(199)		(31)
	Net income/(loss)		1,765		(883)		(1,001)		(157)
	Net loss attributable to non-controlling interests		15		49		12		2
	Net income/(loss) attributable to Trip.com Group Limited		1,780		(834)		(989)		(155)
	Earnings/(Losses) per ordinary share
	- Basic		2.95		(1.29)		(1.52)		(0.24)
	- Diluted		2.88		(1.29)		(1.52)		(0.24)
	Earnings/(Losses) per ADS
	- Basic		2.95		(1.29)		(1.52)		(0.24)
	- Diluted		2.88		(1.29)		(1.52)		(0.24)
	Weighted average ordinary shares outstanding
	- Basic		604,596,792		646,213,517		647,812,835		647,812,835
	- Diluted		629,540,722		646,213,517		647,812,835		647,812,835
	* Share-based compensation included in Operating expenses above is as follows:
	Product development		151		249		107		17
	Sales and marketing		22		58		18		3
	General and administrative		121		200		98		15

 

Trip.com Group Limited
Reconciliation of  GAAP and Non-GAAP Results
(In millions, except % and per share data)
			Quarter ended		Quarter ended		Quarter ended		Quarter ended
			March 31, 2021		December 31, 2021		March 31, 2022		March 31, 2022
			RMB (million)		RMB (million)		RMB (million)		USD (million)
			(unaudited)		(unaudited)		(unaudited)		(unaudited)
	Net income/(loss)		1,765		(883)		(1,001)		(157)
	Less: Interest income		(418)		(757)		(591)		(93)
	Add: Interest expense		407		358		341		54
	Add: Other (income)/expense		(2,508)		433		707		112
	Add: Income tax expense/(benefit)		41		37		(14)		(2)
	Add: Equity in (income)/loss of affiliates		(74)		108		199		31
	Loss from operations		(787)		(704)		(359)		(55)
	Add: Share-based compensation		294		507		223		35
	Add: Depreciation and amortization		277		251		227		36
	Adjusted EBITDA		(216)		54		91		16
	Adjusted EBITDA margin		-5 %		1 %		2 %		2 %
	Net income/(loss) attributable to Trip.com Group Limited		1,780		(834)		(989)		(155)
	Add: Share-based compensation		294		507		223		35
	Add: (Gain)/loss from fair value changes of equity securities investments and exchangeable senior notes		(2,367)		581		785		124
	Add: Tax effects on fair value changes of equity securities investments and exchangeable senior notes		89		55		(55)		(9)
	Non-GAAP net (loss)/income attributable to Trip.com Group Limited		(204)		309		(36)		(5)
	Weighted average ordinary shares outstanding- Diluted-non GAAP		604,596,792		648,139,290		647,812,835		647,812,835
	Non-GAAP Diluted (losses)/income per share		(0.34)		0.48		(0.06)		(0.01)
	Non-GAAP Diluted (losses)/income per ADS		(0.34)		0.48		(0.06)		(0.01)
	Notes for all the condensed consolidated financial schedules presented:
	Note 1: The conversion of Renminbi (RMB) into U.S. dollars (USD) is based on the certified exchange rate of USD1.00=RMB6.3393 on March 31, 2022 published by the Federal Reserve Board.

 

 

View original content:https://www.prnewswire.com/news-releases/tripcom-group-limited-reports-unaudited-first-quarter-of-2022-financial-results-301575525.html

SOURCE Trip.com Group Limited

FAQ

What were Trip.com Group's Q1 2022 earnings results?

Trip.com Group reported stable net revenue of RMB4.1 billion (US$649 million) for Q1 2022, flat year-over-year but down 12% from Q4 2021.

How did the COVID-19 resurgence affect TCOM's performance?

The resurgence impacted travel demand in China, leading to declines in accommodation and corporate travel revenues.

What is the outlook for Trip.com Group after Q1 2022?

Despite Q1 challenges, demand for travel remains strong, with expectations for a positive long-term outlook as travel restrictions ease.

What financial metrics did TCOM report for Q1 2022?

Trip.com Group reported a loss from operations of RMB359 million (US$55 million) and an adjusted EBITDA of RMB91 million (US$16 million).