Ctrip.com Gains 3% As Q1 Results Top View, Guides Q2 Revenue Growth In Line

(RTTNews) - Shares of Ctrip.com International Ltd. (CTRP) gained more than three percent in extended trading on Wednesday after the Chinese travel services company reported results for the first quarter well above analysts' expectations. The company provided revenue growth guidance for the second quarter, in line with Street view.

However, the company also reported a profit for the first quarter that declined 25 percent from last year, despite strong double-digit revenue growth, reflecting significantly lower operating margins.

Ctrip.com International provides travel service of hotel accommodations, airline tickets, packaged tours and corporate travel management in China.

"We are pleased to report the great performance in the first quarter of 2014. We recently expanded our traditional hotel reservation and ticketing services to accommodation reservation and transportation ticketing services," Chairman and CEO James Liang said in a statement.

Shanghai-based Ctrip.com reported net income of RMB 115.35 million or $19 million for the first quarter, down 25 percent from RMB 153.47 million in the prior-year quarter. Earnings per ADS declined to RMB 0.75 or $0.12 from RMB 1.10 last year.

Excluding share-based compensation charges, adjusted net income for the quarter was RMB 237 million or $38 million, compared to RMB 265 million in the prior-year quarter. Earnings per ADS were RMB 1.52 or $0.24, compared to RMB 1.87 or $0.30 a year ago.

Total revenues for the quarter increased 36 percent to RMB 1.67 billion or $269 million from RMB 1.23 billion in the same quarter last year.

Net revenues grew 36 percent to RMB 1.58 billion or $254 million from RMB 1.16 billion in the prior-year quarter.

On average, analysts polled by Thomson Reuters expected the company to report earnings of $0.11 per share for the quarter on revenues of $244.54 million. Analysts' estimates typically exclude special items.

Ctrip.com's accommodation reservation revenues for the quarter grew 46 percent to RMB 657 million or $106 million, primarily driven by a 67 percent increase in accommodation reservation volume, partly offset by a decline in commission per room night.

Transportation ticketing revenues rose 43 percent to RMB 651 million or $105 million, reflecting a 71 percent increase in air ticketing sales volume.

Packaged-tour revenues increased 10 percent to RMB 259 million or $42 million, due to the increase of leisure travel volume. Corporate travel revenues grew 39 percent to RMB 71 million or $11 million, driven by the increased corporate travel demand from business activities.

Operating margins for the quarter plunged 1000 percentage points to 4 percent from last year's 14 percent, as gross margin declined 200 basis points to 72 percent from last year.

Looking ahead to second quarter, Ctrip.com forecasts net revenue growth of about 30 to 35 percent from the prior year. Analysts expect the company to report a 30.7 percent growth in revenues to $265.20 million.

CTRP closed Wednesday's regular trading session at $45.67, down $2.71 or 5.59% on a volume of 6.17 million shares. However, the stock gained $1.43 or $3.12% in after-hours trading.