SHANGHAI, Nov. 22, 2023 /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 third quarter of 2023.
Key Highlights for the Third Quarter of 2023
- Domestic and international businesses continued to show
robust recovery in the third quarter of 2023
- Domestic hotel bookings grew by
over 90% year over year and increased by over 70% compared to the
pre-COVID level for the same period in 2019.
- Outbound hotel and air
reservations recovered to around 80% of the pre-COVID level for the
same period in 2019, compared to the industry-wide recovery rate of
over 50% in terms of international air passenger volume for the
same period.
- Total bookings on the Company's
global OTA platform have increased by over 100% both year over year
and compared to the pre-COVID level for the same period in
2019.
- The Company delivered strong results in the third quarter of
2023
- Total net revenue for the third
quarter grew by 99% year over year.
- Net income for the third quarter
was RMB4.6 billion (US$637 million), which improved significantly
from RMB245 million for the same
period in 2022.
- Adjusted EBITDA for the third
quarter was RMB4.6 billion
(US$634 million). Adjusted EBITDA
margin was 34%, compared to 21% for the same period in 2022 and 33%
for the previous quarter.
"Throughout the third quarter of 2023, both domestic and
international travel experienced a remarkable rebound, thanks to
the robust summer travel demands. This shows just how eager
travelers are to explore the world," said James Liang, Executive Chairman. "Looking ahead,
we will continue our efforts in expanding our global presence and
cultivating AI-related initiatives, laying the foundation for
continued growth of our company."
"We are pleased to build upon the momentum and deliver solid
results in the third quarter," said Jane
Sun, Chief Executive Officer. "To leverage the strong demand
for travel and our investment in technology and product, we are
committed to enhancing our supply chain capabilities and
strengthening brand awareness to solidify our market position."
Third Quarter of 2023 Financial Results and
Business Updates
With the coming of the summer peak season and the strong pent-up
travel demand, the Company's business continued to recover
significantly, which led to an increasing volume of travel
bookings.
For the third quarter of 2023, Trip.com Group reported net
revenue of RMB13.7 billion
(US$1.9 billion), representing a 99%
increase from the same period in 2022 primarily due to substantial
recovery of travel market. Net revenue for the third quarter of
2023 increased by 22% from the previous quarter, primarily due to
seasonality.
Accommodation reservation revenue for the third quarter of 2023
was RMB5.6 billion (US$766 million), representing a 92% increase from
the same period in 2022 primarily due to substantial recovery of
travel market. Accommodation reservation revenue for the third
quarter of 2023 increased by 30% from the previous quarter,
primarily due to seasonality.
Transportation ticketing revenue for the third quarter of
2023 was RMB5.4 billion
(US$736 million), representing a 105%
increase from the same period in 2022 primarily due to substantial
recovery of travel market. Transportation ticketing
revenue for the third quarter of 2023 increased by 11%
from the previous quarter, primarily due to seasonality.
Packaged-tour revenue for the third quarter of 2023 was
RMB1.3 billion
(US$182 million), representing a 243% increase from the same
period in 2022 primarily due to substantial recovery of travel
market. Packaged-tour revenue for the third quarter of
2023 increased by 84% from the previous quarter, primarily due to
seasonality.
Corporate travel revenue for the third quarter of 2023 was
RMB591 million (US$81 million),
representing a 60% increase from the same period in 2022 and a
1% increase from the previous quarter, primarily due to
substantial recovery of travel market.
Cost of revenue for the third quarter of 2023 increased by
94% to RMB2.5 billion (US$338 million) from the same period in 2022 and
increased by 23% from the previous quarter, which was in line with
the increase in net revenue. Cost of revenue as a percentage of net
revenue was 18% for the third quarter of 2023.
Product development expenses for the third quarter of
2023 increased by 44% to RMB3.6 billion (US$490 million) from the same period in 2022 and
increased by 21% from the previous quarter, primarily due to an
increase in product development personnel related expenses. Product
development expenses as a percentage of net revenue was 26%
for the third quarter of 2023.
Sales and marketing expenses for the third quarter of 2023
increased by 93% to RMB2.8 billion
(US$378 million) from the same period
in 2022 and increased by 17% from the previous quarter, primarily
due to an increase in expenses relating to sales and marketing
promotion activities. Sales and marketing expenses as a percentage
of net revenue was 20% for the third quarter of 2023.
General and administrative expenses for the third quarter of
2023 increased by 22% to RMB1.0
billion (US$141 million) from the same period in 2022
primarily due to an increase in general and administrative
personnel related expenses and increased by 8% from the previous
quarter. General and administrative expenses as a percentage of net
revenue was 7% for the third quarter of 2023.
Income tax expense for the third quarter of 2023 was
RMB448 million (US$61 million), compared to RMB277 million for the same period in 2022 and
RMB562 million for the previous
quarter. The change in Trip.com Group's effective tax rate was
primarily due to the combined impacts of changes in respective
profitability of its 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 income for the third quarter of 2023 was RMB4.6 billion (US$637
million), compared to RMB245
million for the same period in 2022 and RMB648 million for the previous quarter. Adjusted
EBITDA for the third quarter of 2023 was RMB4.6 billion (US$634 million),
compared to RMB1.4 billion for the
same period in 2022 and RMB3.7
billion for the previous quarter. Adjusted EBITDA margin was
34% for the third quarter of 2023, compared to 21% for the same
period in 2022 and 33% for the previous quarter.
Net income attributable to Trip.com Group's shareholders for the
third quarter of 2023 was RMB4.6
billion (US$634 million),
compared to RMB266 million for the
same period in 2022 and RMB631
million for the previous quarter. Excluding share-based
compensation charges, fair value changes of equity securities
investments and exchangeable senior notes recorded in other
income/(expense), and their tax effects, non-GAAP net income
attributable to Trip.com Group's shareholders for the third quarter
of 2023 was RMB4.9 billion
(US$673 million), compared to
RMB1.0 billion for the same period in
2022 and RMB3.4 billion for the
previous quarter.
Diluted earnings per ordinary share and per ADS was RMB6.84 (US$0.94) for the third quarter of
2023. Excluding share-based compensation charges, fair value
changes of equity securities investments and exchangeable senior
notes, and their tax effects, non-GAAP diluted earnings per
ordinary share and per ADS was RMB7.26 (US$1.00) for the third quarter of
2023. Each ADS currently represents one ordinary share of the
Company.
As of September 30, 2023, the
balance of cash and cash equivalents, restricted cash, short-term
investment, and held to maturity time deposit and financial
products was RMB79.0 billion
(US$10.8 billion).
Recent Development
From September 2023 to the date of
this press release, the Company purchased 3.6 million ADSs in
aggregate with a total gross consideration of US$120 million pursuant to its existing share
repurchase plan.
The board of directors has recently approved a regular capital
return policy to benefit the Company's shareholders and ADS holders
in the form of discretionary annual share repurchases,
discretionary annual cash dividend declarations, or a combination
thereof, commencing from the year of 2024. Under the policy, the
board of directors reserves the discretion relating to the
determination of the form, timing, and amount of the capital return
measures in any particular year, depending on the Company's
financial condition, results of operations, cash flow, capital
requirements, and other relevant factors.
Conference Call
Trip.com Group's management team will host a conference call at
7:00 PM EST on November 20, 2023 (or 8:00
AM CST on November 21, 2023)
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://register.vevent.com/register/BI570196cd01794d8298b96e3dd8d9fd65
Upon registration, each participant will receive details for
this conference call, including dial-in numbers and a unique access
PIN. To join the conference, please dial the number provided, enter
your PIN, and you will join the conference instantly.
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, 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, the impact of COVID-19 to Trip.com Group's business
operations, 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
the variable interest entities and the contractual arrangements
among Trip.com Group, the variable interest 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 consolidated financial
statements, which are prepared and 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, fair value
changes of equity securities investments and exchangeable senior
notes, net of tax, and other applicable items. 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, fair value
changes of equity securities investments and exchangeable senior
notes, and their tax effects 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."
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