Tongcheng-Elong Holdings, a Chinese online travel firm co-invested by Trip.com Group and Tencent, announced the audited consolidated results for the three months ended March 31, 2020, together with comparative figures for the same period of 2019.
Key Highlights
The Company’s operation and performance were inevitably disrupted by the COVID-19 outbreak since January 2020. Compared with the same period in 2019, some key financial metrics for the three months ended March 31, 2020 were declined due to decreased demand in accommodation reservation services and transportation ticketing service, resulting from the implementation of travel restrictions and lockdown policies imposed by governments around the world to combat the spread of COVID-19.
For the three months ended March 31, 2020:
• Revenue decreased by 43.6% year-to-year to RMB1,005.1 million from RMB1,783.4 million in the same period of 2019.
• Adjusted EBITDA decreased by 74.2% year-to-year to RMB158.9 million from RMB615.6 million in the same period of 2019. Adjusted EBITDA margin decreased from 34.5% in the same period of 2019 to 15.8%.
• Adjusted profit for the period decreased by 82.6% year-to-year to RMB78.1 million from RMB448.5 million in the same period of 2019. Adjusted net margin decreased from 25.1% in the same period of 2019 to 7.8%.
• Average MAUs decreased by 25.5% year-to-year from 199.3 million in same period of 2019 to 148.4 million.
• Average MPUs decreased by 35.9% year-to-year from 23.1 million in the same period of 2019 to 14.8 million.
Revenue
Tongcheng-Elong’s revenue was generated primarily from accommodation reservation business and transportation ticketing business. The following table sets forth a breakdown of its revenue in absolute amount and as a percentage of the total revenue for the periods indicated:
Revenue decreased by 43.6% from RMB1,783.4 million for the three months ended March 31, 2019 to RMB1,005.1 million for the three months ended March 31, 2020.
Revenue from accommodation reservation services decreased by 53.2% from RMB489.2 million for the three months ended March 31, 2019 to RMB229.0 million for the three months ended March 31, 2020.
Revenue from transportation ticketing services decreased by 45.4% from RMB1,258.9 million for the three months ended March 31, 2019 to RMB686.8 million for the three months ended March 31, 2020.
Business Review
As of the end of March 2020, Tongcheng-Elong have already given out the “Black Whale” membership to over 300,000 medical workers, which helped to promote its paid membership system and enhance its brand awareness at the same time.
It utilized innovative live streaming programs to promote its brand so as to enhance user retention and facilitate monetization. Leveraging on its in-depth knowledge in mini-program, it conducted its first mini-program live-streaming in early March 2020. Since then, it continued to launch and promote marketing activities such as “Member’s Day” on mini-program live streaming.
As of March 31, 2020, its online platforms offered over 7,000 domestic routes and over 1.3 million international routes operated by more than 800 domestic and international airlines and agencies, over 2.0 million hotels selections and alternative accommodation options, approximately 360,000 bus routes, over 560 ferry routes and approximately 8,000 domestic tourist attractions ticketing services.
Business Outlook and Strategies
The company says it will continue to focus on the core strategy, operate on cost-saving mode, act on the uncertainties and hunger for opportunities. It is confident that it can overcome the difficulties and grow into a better entity in the future.
In terms of long-term strategy, the company will move along with the transformation from OTA to ITA as a pioneer in the industry. Leveraging on its diversified and cost-effective traffic sources, Tongcheng-Elong will expand its user base and further penetrate into the travel market in China.
Read original report
