SHANGHAI, March 11, 2013 /PRNewswire/ - Home Inns & Hotels Management Inc. (NASDAQ: HMIN) ("Home Inns Group" or "the Company"), a leading economy hotel chain in China, today announced its unaudited financial results for the fourth quarter and full year ended December 31, 2012.
Home Inns Group acquired Motel 168 and has consolidated Motel 168's operating and financial results since October 1, 2011. Consolidated group numbers are presented in this earnings release unless specifically noted. For the purpose of providing more context and comprehensive information to investors, Home Inns Group separately presents key financial data excluding Motel 168 in this earnings release in Appendix 1.
Fourth Quarter and Full Year 2012 Financial Highlights
- Total revenues increased 11.9% to RMB 1.47 billion for the fourth quarter of 2012 and increased 45.7% to RMB 5.770 billion for the full year 2012, which was within the higher end of the guidance range of RMB 5.715 billion to RMB 5.810 billion.
- Adjusted EBITDA (non-GAAP) increased 14.6% to RMB 260.5 million (US$41.8 million) for the fourth quarter of 2012 and increased 25.9% to RMB 1.13 billion (US$181.9 million) for the full year 2012
KeyFinancialResults | ||||||
(RMB Million except RMB per ADS) | 4Q12 | 4Q11 | V% | FY12 | FY11 | V% |
Total Revenues | 1,465.7 | 1,309.9 | 11.9% | 5,769.7 | 3,959.7 | 45.7% |
Income from Operations | 36.3 | 33.2 | 9.3% | 273.7 | 297.4 | -8.0% |
Adj. Income from Operations* | 79.2 | 78.5 | 0.9% | 464.1 | 457.3 | 1.5% |
Net Income/Loss | 6.3 | 32.7 | -80.7% | -26.8 | 351.5 | -107.6% |
Adj. Net Income/Loss* | 80.6 | 36.6 | 120.2% | 300.3 | 326.1 | -7.9% |
EBITDA* | 188.2 | 229.2 | -17.9% | 849.5 | 949.0 | -10.5% |
Adj. EBITDA* | 260.5 | 227.4 | 14.6% | 1,133.4 | 900.2 | 25.9% |
Diluted Earnings/Losses per ADS | 0.14 | -0.12 | F | -0.59 | 2.51 | UF |
Adj. Diluted Earnings/Losses per ADS* | 1.74 | 0.73 | F | 6.62 | 6.92 | UF |
Note: Consolidation of Motel 168 financial results started October 1, 2011 impacting comparability of full year results | ||||||
*Indicates non-GAAP financial measures which exclude any applicable non-recurring items or items not directly impacting underlying business operations, mainly, share-based compensation expenses, acquisition and integration expenses, amortization on up-front fees of acquisition term loans and gain or loss on change in fair value of convertible notes. (see commentary at the end of this earnings release for further details) | ||||||
Fourth Quarter and Full Year 2012 Operational Highlights
- Home Inns Group opened 366 new hotels in 2012, exceeding the guidance range of 330 to 360. As of December 31, 2012, the Group operated 1,772 hotels across 253 cities in China under its three brands. There were a total of 241 hotels contracted or under construction at the end of 2012 including 170 franchised-and-managed hotels representing a strong pipe-line for this business model.
Hotels in Operations | Openings | Closures | ||||||
As of December 31, 2012 | Group | Home Inns | Motel 168 | Yitel | 4Q12 | FY12 | 4Q12 | FY12 |
Total number of Hotels | 1,772 | 1,431 | 334 | 7 | 96 | 366 | 6 | 20 |
Leased-and-Operated | 803 | 646 | 151 | 6 | 33 | 109 | 1 | 5 |
Franchised-and-Managed | 969 | 785 | 183 | 1 | 63 | 257 | 5 | 15 |
Contracted or under Construction | 241 | 211 | 26 | 4 | ||||
Leased-and-Operated | 71 | 56 | 13 | 2 | ||||
Franchised-and-Managed | 170 | 155 | 13 | 2 | ||||
- As of December 31, 2012, Home Inns Group had a total of 11.9 million unique active non-corporate members under its frequent guests programs.
Operating Metrics
4Q2012 | 3Q2012 | 4Q2011 | FY2012 | FY2011 | |
Occupancy Rate | 83.8% | 90.3% | 84.2% | 86.1% | 88.8% |
Average Daily rate (ADR, RMB) | 165 | 174 | 168 | 168 | 172 |
Revenue per Available Room (RevPAR, RMB) | 138 | 157 | 141 | 144 | 152 |
- The year-over-year decrease in RevPAR was mainly driven by continued market softness across China despite signs of improvements in certain macroeconomic indicators. In addition, relatively weaker economic conditions in lower tier cities further hindered hotels' normal ramp up progress towards maturity. This short-term set back does not change the Company's conviction in its strategic positioning in lower tier cities where long term growth prospects exist.
- The year-over-year decrease in RevPAR for the full year of 2012 was also attributable to the full year dilutive impact from Motel 168 in 2012 with a lower overall RevPAR than the core organic business as integration continues.
- Benefiting from continued integration efforts, both occupancy rate and ADR for Motel 168 for the fourth quarter of 2012 improved, to 77.4% and RMB 160 from 73.5% and RMB 154, respectively, resulting in a 9.7% improvements year-over-year in fourth quarter RevPAR to reach RMB 124 from RMB 113 a year ago. RevPAR for Motel 168 for the full year of 2012 was RMB 125. The integration of Motel 168 remains on track and further improvements in RevPAR are expected in 2013 as the integration proceeds in final stages.
"Given sustained market challenges and increasing competition, we are reasonably pleased with our overall performance," said Mr. David Sun, the Company's chief executive officer. "We met our annual revenue expectations and exceeded our target for new hotel openings. Performance of mature hotels remained solid relative to market softness, the integration of Motel 168 continues to be on track, and we have finalized the Yitel brand design and financial blueprint."
"Our growth focus on low-capital-high-margin franchise-and-managed hotels is well supported by our strong brand, our well-run franchise programs and the increasing demand from our quality franchisee partners. We plan to conclude Motel 168 integration this year, and this second economy brand will then start to contribute positively to our bottom line. The impressive development trends of Yitel hotels in operations have proven concept and execution model, and we expect to scale up the Yitel portfolio accordingly," Mr. Sun continued. "Meaningful improvements may still be months ahead, and the Company is focused on sustainable profitable growth for the long run. We have built solid internal readiness including strong franchised-and-managed hotels growth momentum and continued cost control initiatives to take advantage of market recoveries when time comes and to capture long-term growth prospects of the Chinese economy."
Detailed Overview of Financial Results for Fourth Quarter and Full Year 2012
Total Revenues | ||||||
Fourth Quarter 2012 | Full Year 2012 | |||||
(RMB/USD in Millions) | RMB | USD | V% | RMB | USD | V% |
Leased-and-Operated Hotels | 1,305.0 | 209.5 | 10.5% | 5,164.8 | 829.0 | 45.1% |
Franchised-and-Managed Hotels | 160.7 | 25.8 | 24.8% | 604.9 | 97.1 | 51.2% |
Total Revenues | 1,465.7 | 235.3 | 11.9% | 5,769.7 | 926.1 | 45.7% |
Less: Business Taxes and related surcharges | -90.1 | -14.5 | 10.9% | -353.4 | -56.7 | 41.8% |
Net Revenues | 1,375.5 | 220.8 | 12.0% | 5,416.3 | 869.4 | 46.0% |
- Both year-over-year increases in total revenues from leased-and-operated hotels for the fourth quarter of 2012 and the full year of 2012 were mainly driven by an increase in the number of hotels in operation offsetting impact from market-driven decrease in RevPAR. The increase in the number of leased-and-operated hotels in operation for the full year was attributable in large part to acquisition of Motel 168 effective October 1, 2011.
- Both year-over-year increases in total revenues from franchised-and-managed hotels for the fourth quarter of 2012 and the full year of 2012 were mainly driven by an increase in the number of such hotels in operation. The increase in the number of franchised-and-managed hotels in operation for the full year was attributable in large part to acquisition of Motel 168 effective October 1, 2011.
- Revenues from Motel 168 included in total revenues were RMB 365.0 million (US$58.6 million) for the fourth quarter of 2012 and RMB 1.47 billion (US$235.7 million) for the full year of 2012. Revenues of Motel 168 fell slightly below its previous revenue guidance for the full year 2012 as a result of overall market weakness and significant elimination of unprofitable food and beverage business operations. Integration of Motel 168 remains on track and the Company expect to conclude the integration in 2013.
Total Operating Costs and Expenses / Total Operating Income
Fourth Quarter 2012 | ||||||||||||
Share-Based | Integration | Adjusted | ||||||||||
(RMB/USDinMillions | GAAP Results | Compensation | Costs | Non-GAAP Results | ||||||||
Vpts - change in %pts of total revenues) | RMB | USD | Vpts | RMB | USD | RMB | USD | RMB | USD | Vpts | ||
Leased-and-Operated Hotel Costs | 1,208.8 | 194.0 | 1.0pts | -2.0 | -0.3 | -19.9 | -3.2 | 1,186.9 | 190.5 | 0.8pts | ||
Franchised-and-Managed Hotel Personnel Costs | 24.6 | 3.9 | 0.1pts | -2.5 | -0.4 | - | - | 22.1 | 3.5 | 0.1pts | ||
Sales and Marketing Expenses | 24.8 | 4.0 | 0.2pts | -0.4 | -0.1 | - | - | 24.4 | 3.9 | 0.2pts | ||
General and Administrative Expenses | 83.4 | 13.4 | -1.1pts | -17.6 | -2.8 | -0.6 | -0.1 | 65.2 | 10.5 | -0.3pts | ||
Total Operating Costs and Expenses | 1,341.6 | 215.3 | 0.3pts | -22.5 | -3.6 | -20.5 | -3.3 | 1,298.6 | 208.4 | 0.8pts | ||
Total Operating Income | 36.3 | 5.8 | - | -22.5 | -3.6 | -20.5 | -3.3 | 79.2 | 12.7 | -0.6pts | ||
Full Year 2012 | ||||||||||||
Share-Based | Integration | Adjusted | ||||||||||
(RMB/USD in Millions | GAAP Results | Compensation | Costs | Non-GAAP Results | ||||||||
Vpts - change in %pts of total revenues) | RMB | USD | Vpts | RMB | USD | RMB | USD | RMB | USD | Vpts | ||
Leased-and-Operated Hotel Costs | 4,642.0 | 745.1 | 5.7pts | -8.2 | -1.3 | -83.7 | -13.4 | 4,550.1 | 730.3 | 4.5pts | ||
Franchised-and-Managed Hotel Personnel Costs | 125.0 | 20.1 | 0.3pts | -9.6 | -1.5 | - | - | 115.5 | 18.5 | 0.3pts | ||
Sales and Marketing Expenses | 76.9 | 12.3 | 0.2pts | -1.5 | -0.2 | -0.1 | - | 75.3 | 12.1 | 0.2pts | ||
General and Administrative Expenses | 315.2 | 50.6 | -3.0pts | -74.1 | -11.9 | -13.2 | -2.1 | 228.0 | 36.6 | -1.0pts | ||
Total Operating Costs and Expenses | 5,159.1 | 828.1 | 3.2pts | -93.4 | -15.0 | -97.0 | -15.6 | 4,968.8 | 797.6 | 4.0pts | ||
Other Income | 16.6 | 2.7 | n/a | 16.6 | 2.7 | n/a | ||||||
Total Operating Income | 273.7 | 43.9 | -2.8pts | -93.4 | -15.0 | -97.0 | -15.6 | 464.1 | 74.5 | -3.5pts | ||
Total operating costs and expenses were RMB 1.34 billion (US$215.3 million) for the fourth quarter of 2012, representing 91.5% of total revenues for the quarter, and RMB 5.16 billion (US$ 828.1 million) for the full year of 2012, representing 89.4% of total revenues for the year. Total operating costs and expenses excluding any share-based compensation expenses and acquisition and integration costs, (non-GAAP) for the fourth quarter of 2012 were 88.6% of total revenues, compared to 87.8% in the same period a year ago, and 86.1% for the full year of 2012 compared to 82.2% for the full year of 2011.
Both year-over-year increases in total operating costs and expenses as a percentage of total revenues for the fourth quarter and the full year of 2012 were mainly due to overall soft market conditions, lack of systematic price increases and rising operating costs net of productivity benefits from general and administrative cost. The increase in this ratio for the full year was also due to a higher cost ratio from Motel 168 with one quarter of results consolidated in 2011 compared to four quarters of results consolidated in 2012.
- Total leased-and-operated hotel costs were RMB 1.21 billion (US$194.0 million) for the fourth quarter of 2012 and RMB 4.64 billion (US$745.1 million) for the full year of 2012. Total leased-and-operated hotel costs excluding any share-based compensation expenses and acquisition and integration costs (non-GAAP) were 91.0% of the leased-and-operated hotel revenue in the fourth quarter of 2012 compared to 88.9% in the same period a year ago, and 88.1% for the full year of 2012 compared to 82.7% for the full year of 2011. The year-over-year increases in this expense ratio were mainly due to weaker revenue base driven by market softness, the absence of systematic price increases, and rising operating costs including energy costs and personnel costs not fully absorbed by productivity initiatives. The year-over-year increase in this expense ratio for the full year was also driven by a higher cost ratio from Motel 168 hotels whose results were consolidated starting fourth quarter of 2011.
Pre-opening cost was RMB 26.8 million (US$4.3 million) for the fourth quarter of 2012 and RMB 104.2 million (US$16.7 million) for the full year of 2012. - Personnel costs of franchised-and-managed hotels were RMB 24.6 million (US$3.9 million) for the fourth quarter of 2012 and RMB 125.0 million (US$20.1 million) for the full year of 2012. Personnel costs of franchised-and-managed hotels excluding share-based compensation expenses (non-GAAP) were 13.8% of franchised-and-managed hotel revenues in the fourth quarter of 2012, compared to 14.3% in the same period of 2011, and 19.1% for the full year of 2012 compared to 17.2% for the full year of 2011. The decrease in this expense ratio in the fourth quarter of 2012 was due to one-time adjustment in the fourth quarter of 2012. The year-over-year increase in this ratio was mainly due to relatively lower revenue performance by franchised-and-managed hotels at Motel 168 whose results were consolidated for the full year of 2012 and only the fourth quarter for the full year of 2011.
- Sales and marketing expenses were RMB 24.8 million (US$4.0 million) for the fourth quarter of 2012, and 76.9 million (US$12.3 million) for the full year of 2012. Sales and marketing expenses excluding share-based compensation expenses (non-GAAP) were 1.7% of total revenues for the fourth of quarter 2012 compared to 1.5% in the same period of 2011, and 1.3% of total revenues for the full year of 2012 compared to 1.1% of total revenues in 2011. The year-over-year increase in this sales and marketing expenses as a percentage of total revenues for the fourth quarter was mainly due to non-recurring spending on marketing programs in the fourth quarter in support of Home Inns Group's multi-brand strategy. The sales and marketing expense ratio was 1.3% in the full year of 2011 after taking into consideration of the one-time catch-up adjustment resulted from the adoption of an estimated redemption rate for customer rewards during 2011. The Company continued to rely largely on basic and cost-effective sales and market practices in supporting its revenue growth.
- General and administrative expenses were RMB 83.4 million (US$13.4 million) for the fourth quarter of 2012, and RMB 315.2 million (US$50.6 million) for the full year of 2012. General and administrative expenses excluding any share-based compensation expenses, acquisition and integration costs (non-GAAP) were 4.5% of total revenues for the quarter compared to 4.7% in the same period of 2012, and 4.0% of total revenue for the full year of 2012 compared to 5.0% for the full year of 2011. Both year-over-year decreases in general and administrative expenses as a percentage of total revenues in the fourth quarter and full year 2012 came as a result of effective cost control and productivity enhancements. The Company continued to benefit from cost discipline and economies of scale.
Income from Operations was RMB 36.3 million (US$5.8 million) for the fourth quarter of 2012 and RMB 273.7 million (US$43.9 million) for the full year of 2012. Income from operations excluding share-based compensation expenses and integration cost (non-GAAP) for the fourth quarter of 2012 was RMB 79.2 million (US$12.7 million), or 5.4% of total revenues, compared to RMB 78.5 million, or 6.0% of total revenues, in the same period of 2011. Income from operations excluding share-based compensation expenses and integration cost (non-GAAP) for 2012 was RMB 464.1 million (US$74.5 million), or 8.0% of total revenues, compared to RMB 457.3 million, or 11.5% of total revenues, in 2011.
The year-over-year decrease in income from operations as a percentage of total revenue for the fourth quarter of 2012 and full year of 2012 was mainly due to weaker operating environment, and the absence of systematic price increases to offset rising hotel operating costs including utilities and personnel related costs. Consolidation of Motel 168 for the full year of 2012 with higher cost ratio as the business was still in the process of integration also contributed to the year over year decrease in the income ratio.
Provided that the market condition improves in the future, the Company is prepared to improve profitability through pricing, higher-mix of margin-rich franchise-and-managed hotels expansion focus, further productivity gains and headquarter costs leverage.
EBITDA (non-GAAP) | ||||||||
(RMB/USDinMillions) | Fourth Quarter 2012 | Full Year 2012 | ||||||
(%Rev-% of Total Revenues) | RMB | USD | %Rev | RMB | USD | %Rev | ||
EBITDA (Non-GAAP) | 188.2 | 30.2 | 12.8% | 849.5 | 136.4 | 14.7% | ||
Net Foreign Exchange Gain/Loss | -15.0 | -2.4 | -1.0% | -0.2 | -0.0 | -0.0% | ||
Share-Based Compensation Expenses | 22.5 | 3.6 | 1.5% | 93.4 | 15.0 | 6.4% | ||
Integration Cost | 20.5 | 3.3 | 1.4% | 97.0 | 15.5 | 6.6% | ||
Non-Operating Income/Expenses | -1.0 | -0.2 | -0.1% | 6.7 | 1.1 | 0.5% | ||
Gain/Loss on Fair Value Change in Convertible Notes | 45.4 | 7.3 | 3.1% | 87.1 | 14.0 | 5.9% | ||
Adjusted EBITDA (Non-GAAP) | 260.5 | 41.8 | 17.8% | 1,133.4 | 181.9 | 19.6% | ||
Consolidated Net Income Attributable to Home Inns Group's Shareholders | ||||||||
(RMB/USDinMillions) | Fourth Quarter 2012 | Full Year 2012 | ||||||
(%Rev-% of Total Revenues) | RMB | USD | %Rev | RMB | USD | %Rev | ||
Net Income (GAAP) | 6.3 | 1.0 | 0.4% | -26.8 | -4.3 | -0.5% | ||
Net Foreign Exchange Gain/Loss | -15.0 | -2.4 | -1.0% | -0.2 | -0.0 | -0.0% | ||
Share-Based Compensation Expenses | 22.5 | 3.6 | 1.5% | 93.4 | 15.0 | 1.6% | ||
Integration Cost | 20.5 | 3.3 | 1.4% | 97.0 | 15.6 | 1.7% | ||
Amortization of Upfront Fees on Term Loan | 2.0 | 0.3 | 0.1% | 43.3 | 6.9 | 0.7% | ||
Non-Operating Income/Expenses | -1.0 | -0.2 | -0.1% | 6.7 | 1.1 | 0.1% | ||
Gain/Loss on Fair Value Change in Convertible Notes | 45.4 | 7.3 | 3.1% | 87.1 | 14.0 | 1.5% | ||
Adjusted Net Income (Non-GAAP) | 80.6 | 12.9 | 5.5% | 300.3 | 48.2 | 5.2% | ||
Basic and Diluted Earnings Per Ordinary Share and Per ADS | ||||||||
Fourth Quarter 2012 | Full Year 2012 | |||||||
Ordinary Share | ADS Share | Ordinary Share | ADS Share | |||||
RMB | USD | RMB | USD | RMB | USD | RMB | USD | |
Basic | 0.07 | 0.01 | 0.14 | 0.02 | -0.29 | -0.05 | -0.59 | -0.09 |
Diluted | 0.07 | 0.01 | 0.14 | 0.02 | -0.29 | -0.05 | -0.59 | -0.09 |
Adjusted Basic (Non-GAAP) | 0.89 | 0.14 | 1.77 | 0.28 | 3.31 | 0.53 | 6.62 | 1.06 |
Adjusted Diluted (Non-GAAP) | 0.87 | 0.14 | 1.74 | 0.28 | 3.31 | 0.53 | 6.62 | 1.06 |
Cash Flow
Net operating cash flow for the fourth quarter of 2012 was RMB 186.8 million (US$30.0 million), compared to RMB 139.5 million in the same period of 2011. Capitalized expenditures for the fourth quarter of 2012 were RMB 250.4 million (US$40.2 million), while related cash paid for capital expenditures during the quarter was RMB 305.6 million (US$49.0 million).
For the full year 2012, net operating cash flow was RMB 716.9 million (US$115.1 million), compared to RMB 726.1 million in 2011. Capitalized expenditures for 2012 were RMB 1.00 billion (US$160.9 million), while related cash paid for capital expenditures during the year was RMB 958.1 million (US$153.8 million).
Balance Sheet
As of December 31, 2012, Home Inns Group had cash and cash equivalents of RMB 663.2 million (US$106.4 million). Financial liabilities of RMB 1.07 billion (US$171.2 million) consisted of the outstanding balance of long-term financial liability for convertible notes (issued in December 2010) and interest swap contracts (both measured at fair value). The balance of the Company's U.S. dollar-denominated four-year term loan facility was RMB 748.0 million (US$120.1 million). The Company redeemed the outstanding convertible bonds issued in 2007 in the fourth quarter of 2012.
The Company plans to execute its future expansions with more franchised-and-managed hotels which do not require capital investments. The number of new lease-and-operated hotels openings will be reduced accordingly. With a strong underlying cash-generative hotel operations, the Company expects to improve its cash position in the near future.
Outlook for First Quarter and Full Year 2013
Home Inns Group targets to open 360 to 380 new hotels in 2013, including approximately 80 to 90 leased-and-operated hotels and 270 to 300 franchised-and-managed hotels.
Home Inns Group expects total revenues for the group for 2013 to be in the range of RMB 6,600 million (US$1,059.4 million) to RMB 6,800 million (US$1,091.5 million), representing a growth of 14.4% to 17.9% over 2012. Total revenues for the group in the first quarter of 2013 are expected to be in the range of RMB 1,385 million (US$222.3 million) to RMB 1,415 million (US$227.1 million).
Total revenues for Motel 168 brand for 2013 are expected to be in the range of RMB 1,650 million (US$264.8 million) to RMB 1,700 million (US$272.9 million). Total revenues for Motel 168 brand in the first quarter of 2013 are expected to be in the range of RMB 330 million (US$53.0 million) to RMB 340 million (US$54.6 million).
Excluding Motel 168, total revenues for 2013 are expected to be in the range of RMB 4,950 million (US$794.5 million) to RMB 5,100 million (US$818.6 million). Excluding Motel 168, total revenues in the first quarter of 2013 are expected to be in the range of RMB 1,055 million (US$169.3 million) to RMB 1,075 million (US$172.5 million).
These forecasts reflect the Company's current and preliminary view, which are subject to change.
This announcement contains translations of certain RMB amounts into U.S. dollars solely for the convenience of the reader. Unless otherwise noted, all translations from RMB to U.S. dollars are made at a rate of RMB 6.2301 to US$1.00, the noon buying rate for December 31, 2012 set forth in the H.10 statistical release of the Federal Reserve Board.
Conference Call Information
Management will hold an earnings conference call at 9 PM U.S. Eastern Daylight Time on Monday, March 11, 2013 (9 AM Beijing/Hong Kong Time on Tuesday, March 12, 2013).
Dial-in details for the earnings conference call are as follows:
U.S. (toll free): | 1.866.519.4004 |
U.S.: | 1.718.354.1231 |
China Mainland: | 800.819.0121 or 400.620.8038 |
Hong Kong (toll free): | 800.930.346 |
Hong Kong: | 852.2475.0994 |
U.K. (toll free): | 080.8234.6646 |
U.K.: | 44.2030.598.139 |
Australia (toll free): | 1.800.457.076 |
Taiwan (toll free): | 008.0112.6920 |
International: | 65.6723.9381 |
Pass code for all regions: | Home Inns |
A replay of the conference call may be accessed by phone at the following numbers until the end of Monday, March 18, 2013 U.S. Eastern Daylight Time.
U.S. toll free: | 1.855.452.5696 |
China toll free: | 400.120.0932 or 800.870.0205 |
Hong Kong toll free: | 800.963.117 |
International: | 61.2.8199.0299 |
Conference ID number: | 96051138 |
Live and archived webcasts of this conference call will be available at http://english.homeinns.com.
About Home Inns Group
Home Inns Group is a leading economy hotel chain in China based on the number of hotels and hotel rooms, as well as the geographic coverage of the hotel chain. Since the Company commenced operations in 2002, it has built Home Inn as one of the best-known economy hotel brands in China. In October of 2011, Home Inns Group acquired Motel 168, another well-known hotel chain in China, as its second economy hotel brand. Home Inns Group aims to offer a consistent product and high-quality services to primarily serve the fast growing population of value-conscious individual business and leisure travelers who demand clean, comfortable and convenient lodging. Home Inns Group's ADSs, each of which represents two ordinary shares, are currently trading on the NASDAQ Global Select Market under the symbol "HMIN." For more information about Home Inns Group, please visit http://english.homeinns.com.
Safe Harbor
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 "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Any statements in this press release that are not historical facts are forward-looking statements that involve factors, risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Such factors and risks include our anticipated growth strategies; our future results of operations and financial condition; the economic conditions of China; the regulatory environment in China; our ability to attract customers and leverage our brand; trends and competition in the lodging industry; the expected growth of the lodging market in China; our expected successful consolidation and integration of Motel 168 with our existing operations; and other factors and risks detailed in our filings with the Securities and Exchange Commission. This press release also contains statements or projections that are based upon information available to the public, as well as other information from sources which management believes to be reliable, but it is not guaranteed by us to be accurate, nor does it purport to be complete. We undertake no obligation to update or revise to the public any forward-looking statements, whether as a result of new information, future events or otherwise, unless required by applicable law.
Non-GAAP Financial Measures
To supplement Home Inns Group's unaudited consolidated financial results presented in accordance with U.S. GAAP, Home Inns Group uses the following non-GAAP measures:
(a) total operating costs and expenses excluding share-based compensation expenses and acquisition and integration costs
(b) total leased-and-operated hotel costs excluding share-based compensation expenses and integration costs
(c) personnel costs of franchised-and-managed hotels excluding share-based compensation expenses
(d) sales and marketing expenses excluding share-based compensation expenses
(e) general and administrative expenses excluding share-based compensation expenses and acquisition and integration costs
(f) income from operations excluding share-based compensation expenses and acquisition and integration costs
(g) adjusted net income attributable to shareholders excluding any share-based compensation expenses, foreign exchange gain or loss, acquisition and integration cost, upfront fee amortization of term loan, gain or loss from fair value change of convertible notes and interest swap derivatives, withholding tax for profit distribution of previous periods and other non-operating expenses
(h) adjusted basic and diluted earnings per ADS and per share excluding foreign exchange gain or loss, share-based compensation expenses, gain on buy-back of convertible bonds, issuance costs for convertible notes, gain or loss from fair value change of convertible notes, acquisition and integration cost, withholding tax for profit distribution of previous periods, non-operating expenses and upfront fee amortization of term loan, and
(i) adjusted EBITDA excluding foreign exchange gain or loss, share-based compensation expenses, gain on buy-back of convertible bonds, issuance costs for convertible notes, gain or loss from fair value change of convertible notes, acquisition and integration costs, non-operating expenses and upfront fee amortization of term loan
Any financial data referring to "Excluding Motel 168" are also non-GAAP financial measures. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with U.S. GAAP. For more information on these non-GAAP financial measures, please see the table captioned "Reconciliations of GAAP and non-GAAP results" set forth at the end of this press release.
Home Inns Group believes that, used in conjunction with GAAP financial measures, these non-GAAP financial measures provide meaningful supplemental information regarding the Group's performance, and both management and investors benefit from referring to these non-GAAP financial measures in assessing the Group's performance and when planning and forecasting future periods. Management believes that EBITDA, defined as earnings before interest, income tax expense, depreciation and amortization, is a useful financial metric to assess Home Inns Group's operating and financial performance before the impact of investing and financing transactions and income taxes. In addition, management believes that EBITDA is widely used by other companies in the lodging industry and may be used as an analysis tool by both management and investors to measure and compare Home Inns Group's operational and financial performance with industry peers.
One of the limitations of using non-GAAP income from operations, EBITDA, adjusted EBITDA and non-GAAP net income attributable to shareholders is that they do not include all items that impact Home Inns Group's net income (loss) for the period. These non-GAAP measures exclude share-based compensation expenses, foreign exchange gain or loss and gain or loss from fair value change of convertible notes, which have been and will continue to be a significant recurring expense in Home Inns Group's business. In addition, Home Inns Group's EBITDA and adjusted EBITDA may not be comparable to EBITDA or similarly titled measures utilized by other companies since such other companies may not calculate EBITDA in the same manner as Home Inns Group does. Management compensates for this and other limitations by providing specific information regarding the GAAP amounts excluded from each non-GAAP measure. Home Inns Group computes the non-GAAP financial measures using the same consistent method from quarter to quarter. Reconciliations of GAAP and non-GAAP results are included at the end of this press release. The non-GAAP adjustment items do not include the tax impact.
The presentation of EBITDA and adjusted EBITDA should not be construed as an indication that Home Inns Group's future results will be unaffected by other charges and gains Home Inns Group considers to be outside the ordinary course of its business.
Home Inns Group completed its acquisition of 100% equity interest in Motel 168, and took control of Motel 168 effective on October 1, 2011. Home Inns Group has consolidated Motel 168's operating and financial results since October 1, 2011. Home Inns Group has presented certain separated financial data of Motel 168 in this earning release for the purpose of providing more information to investors. Home Inns Group will provide separate financial data for Motel 168 through the integration period.
For investor and media inquiries, please contact:
Johnny Wang
Home Inns & Hotels Management Inc.
Tel: +86-21-3401-9898*2504
Email: johnnywang@homeinns.com
Cara O'Brien
FTI Consulting
Tel: +852-3768-4537
Email: cara.obrien@fticonsulting.com
Appendix 1:
For the purpose of providing more context and comprehensive information to investors, Home Inns Group separately presents key financial data excluding Motel 168 below. Home Inns Group will continue to provide separate financial data for Motel 168 through the integration period. All information outlined below excludes Motel 168 results and Motel 168 integration costs unless specifically mentioned.
Fourth Quarter and Full Year 2012 Operational and Financial Highlights for Home Inns and Yitel Hotels | |||||||||||||
OperatingMetrics | |||||||||||||
4Q12 | 3Q12 | 4Q11 | FY12 | FY11 | |||||||||
Occupancy Rate | 85.6% | 92.7% | 88.4% | 88.7% | 90.3% | ||||||||
Average Daily rate (ADR RMB) | 166 | 177 | 173 | 170 | 173 | ||||||||
Revenue per Available Room (RevPAR RMB) | 143 | 164 | 153 | 151 | 156 | ||||||||
Total Revenues | 4Q12 | FY12 | |||||||||||
(Millions) | RMB | USD | V% | RMB | USD | V% | |||||||
Total Revenues | 1,100.6 | 176.7 | 16.8% | 4,301.2 | 690.4 | 19.7% | |||||||
Leased-and-Operated Hotels | 959.7 | 154.0 | 15.7% | 3,767.1 | 604.7 | 17.4% | |||||||
Franchised-and-Managed Hotels | 140.9 | 22.6 | 25.3% | 534.1 | 85.7 | 39.2% | |||||||
Total Operating Costs and Expenses | |||||||||||||
Fourth Quarter 2012 | |||||||||||||
(Millions) | GAAP Results | Share-based Comp. | Integration | Non-GAAP Results | |||||||||
(Vpts - change in %pts of total revenue) | RMB | USD | Vpts | RMB | USD | RMB | USD | RMB | USD | Vpts | |||
Leased-and-Operated Hotel Costs | 843.9 | 135.5 | 1.4pts | -1.8 | -0.3 | -0.1 | -0.02 | 842.0 | 135.1 | 1.4pts | |||
Franchised-and-Managed Hotel Personnel Costs | 20.8 | 3.3 | 0.0pts | -2.2 | -0.4 | - | - | 18.7 | 3.0 | 0.0pts | |||
Sales and Marketing Expenses | 21.0 | 3.4 | 0.2pts | -0.4 | -0.06 | - | - | 20.7 | 3.3 | 0.2pts | |||
General and Administrative Expenses | 73.6 | 11.8 | -1.3pts | -16.9 | -2.7 | - | - | 56.6 | 9.1 | -0.5pts | |||
Total Operating Costs and Expenses | 959.3 | 154.0 | 0.3pts | -21.3 | -3.4 | -0.1 | - | 937.9 | 150.5 | 1.1pts | |||
Full Year 2012 | |||||||||||||
(Millions) | GAAP Results | Share-based Comp. | Integration | Non-GAAP Results | |||||||||
(Vpts - change in %pts of total revenues) | RMB | USD | Vpts | RMB | USD | RMB | USD | RMB | USD | Vpts | |||
Leased-and-Operated Hotel Costs | 3,218.8 | 516.7 | 2.3pts | -7.2 | -1.2 | -7.8 | -1.3 | 3,203.7 | 514.2 | 2.1pts | |||
Franchised-and-Managed Hotel Personnel Costs | 103.7 | 16.6 | 0.5pts | -8.4 | -1.4 | - | - | 95.3 | 15.3 | 0.4pts | |||
Sales and Marketing Expenses | 65.6 | 10.5 | 0.4pts | -1.5 | -0.2 | - | - | 64.0 | 10.3 | 0.4pts | |||
General and Administrative Expenses | 264.1 | 42.4 | -2.8pts | -71.9 | -11.5 | - | - | 192.2 | 30.9 | -0.8pts | |||
Total Operating Costs and Expenses | 3,652.2 | 586.2 | 0.4pts | -89.1 | -14.3 | -7.8 | -1.3 | 3,555.3 | 570.7 | 2.0pts | |||
Profitability | Fourth Quarter 2012 | ||||||||||||
(Millions) | GAAP Results | Reconciliation | Non-GAAP Results | ||||||||||
(Vpts - change in %pts of total revenues) | RMB | USD | Vpts | RMB | USD | RMB | USD | Vpts | |||||
Income from Operations | 74.6 | 12.0 | 1.2pts | 21.4 | 3.4 | 96.0 | 15.4 | 0.7pts | |||||
Net Income | 4.4 | 0.7 | -4.9pts | 53.3 | 8.6 | 57.7 | 9.3 | 2.4pts | |||||
EBITDA (Non-GAAP) | 183.0 | 29.4 | -2.7pts | 51.3 | 8.2 | 234.3 | 37.6 | 4.9pts | |||||
Full Year 2012 | |||||||||||||
(Millions) | GAAP Results | Reconciliation | Non-GAAP Results | ||||||||||
(Vpts - change in %pts of total revenues) | RMB | USD | Vpts | RMB | USD | RMB | USD | Vpts | |||||
Income from Operations | 397.6 | 63.8 | 1.9pts | 1.0 | 0.2 | 494.5 | 79.4 | 0.7pts | |||||
Net Income | 58.4 | 9.4 | -8.6pts | 233.3 | 37.4 | 291.7 | 46.8 | -0.9pts | |||||
EBITDA (Non-GAAP) | 794.3 | 127.5 | -3.7pts | 190.0 | 30.5 | 984.3 | 158.0 | 3.4pts | |||||
Home Inns & Hotels Management Inc. | ||||||
Unaudited Condensed Consolidated Balance Sheet | ||||||
December31,2011 | December 31, 2012 | |||||
RMB '000 | RMB '000 | US$ '000 | ||||
ASSETS | ||||||
Current assets: | ||||||
Cash and cash equivalents | 1,786,038 | 663,156 | 106,444 | |||
Restricted cash | 205,926 | 205,739 | 33,023 | |||
Accounts receivable, net | 91,980 | 98,176 | 15,758 | |||
Receivables from related parties | 6,379 | 6,818 | 1,094 | |||
Consumables | 43,049 | 41,600 | 6,677 | |||
Prepayments and other current assets | 137,887 | 172,534 | 27,694 | |||
Deferred tax assets | 75,446 | 80,369 | 12,900 | |||
Total current assets | 2,346,705 | 1,268,392 | 203,590 | |||
Investment in a jointly controlled entity | 8,301 | 6,625 | 1,063 | |||
Property and equipment, net | 3,452,846 | 3,846,835 | 617,460 | |||
Goodwill | 2,197,728 | 2,254,631 | 361,893 | |||
Intangible assets, net | 1,174,452 | 1,149,419 | 184,494 | |||
Other assets | 170,039 | 117,350 | 18,836 | |||
Non-current deferred tax assets | 199,765 | 310,762 | 49,881 | |||
Total assets | 9,549,836 | 8,954,014 | 1,437,217 | |||
LIABILITIES | ||||||
Current liabilities: | ||||||
Accounts payable | 91,457 | 76,825 | 12,331 | |||
Payables to related parties | 2,797 | 3,798 | 610 | |||
Short term loans | 346,550 | 12,571 | 2,018 | |||
Finance lease liabilities | 7,006 | 6,660 | 1,069 | |||
Salaries and welfare payable | 178,032 | 215,569 | 34,601 | |||
Income tax payable | 80,356 | 76,382 | 12,260 | |||
Other taxes payable | 27,295 | 27,761 | 4,456 | |||
Deferred revenues | 202,870 | 202,874 | 32,564 | |||
Convertible bonds | 113,051 | - | - | |||
Other unpaid and accruals | 154,498 | 165,886 | 26,624 | |||
Other payables | 847,090 | 925,134 | 148,494 | |||
Deferred tax liability | 38,313 | 29,439 | 4,725 | |||
Total current liabilities | 2,089,315 | 1,742,899 | 279,752 | |||
Long term loans | 1,165,666 | 735,404 | 118,040 | |||
Deferred rental | 593,955 | 631,618 | 101,382 | |||
Deferred revenues | 79,202 | 45,089 | 7,237 | |||
Finance lease liabilities | 7,750 | 1,620 | 260 | |||
Deposits | 63,472 | 91,462 | 14,681 | |||
Other long term payables | - | 10,620 | 1,705 | |||
Unfavorable lease liabilities | 396,774 | 370,548 | 59,477 | |||
Financial liabilities* | 979,008 | 1,066,771 | 171,229 | |||
Deferred tax liabilities | 294,728 | 288,321 | 46,279 | |||
Total liabilities | 5,669,870 | 4,984,352 | 800,042 | |||
Commitments and contingencies | ||||||
Shareholders' equity | ||||||
Ordinary shares (US$0.005 par value; | 3,542 | 3,574 | 574 | |||
Additional paid-in capital | 2,683,923 | 2,802,905 | 449,897 | |||
Statutory reserves | 125,863 | 158,417 | 25,428 | |||
Retained earnings | 1,051,976 | 992,505 | 159,308 | |||
Total Home Inns shareholders' equity | 3,865,304 | 3,957,401 | 635,207 | |||
Noncontrolling interests | 14,662 | 12,261 | 1,968 | |||
Total shareholders' equity | 3,879,966 | 3,969,662 | 637,175 | |||
Total liabilities and shareholders' equity | 9,549,836 | 8,954,014 | 1,437,217 | |||
- | - | - | ||||
Note 1: The conversion of Renminbi ("RMB") into United States dollars ("US$") is based on rate of US$1.00=RMB6.2301 | ||||||
on December 31, 2012, representing the certificated exchange rate published by the Federal Reserve Board. | ||||||
Note 2：Financial liabilities represent convertible notes measured at fair value and interest swap transaction. | ||||||
Home Inns & Hotels Management Inc. | ||||||||||||||||||||||||||||||||||
Unaudited Condensed Consolidated Statement of Operations | ||||||||||||||||||||||||||||||||||
Quarter Ended | Year Ended | |||||||||||||||||||||||||||||||||
December 31, 2011 | September 30, 2012 | December 31, 2012 | December 31, 2011 | December 31, 2012 | ||||||||||||||||||||||||||||||
RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | US$ '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | US$ '000 | RMB '000 | RMB '000 | ||||||||||||||||||
Group | Motel 168 | excluding | Group | Motel 168 | excluding | Group | Group | Motel 168 | excluding | Group | Motel 168 | excluding | Group | Group | Motel 168 | excluding | ||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||||||
Leased-and-operated hotels | 1,181,157 | 351,380 | 829,777 | 1,431,786 | 381,068 | 1,050,718 | 1,304,958 | 209,460 | 345,233 | 959,725 | 3,559,740 | 351,380 | 3,208,360 | 5,164,799 | 829,007 | 1,397,734 | 3,767,065 | |||||||||||||||||
Franchised-and-managed hotels | 128,743 | 16,243 | 112,500 | 166,624 | 17,797 | 148,827 | 160,724 | 25,798 | 19,812 | 140,912 | 399,986 | 16,243 | 383,743 | 604,936 | 97,099 | 70,832 | 534,104 | |||||||||||||||||
Total revenues | 1,309,900 | 367,623 | 942,277 | 1,598,410 | 398,865 | 1,199,545 | 1,465,682 | 235,258 | 365,045 | 1,100,637 | 3,959,726 | 367,623 | 3,592,103 | 5,769,735 | 926,106 | 1,468,566 | 4,301,169 | |||||||||||||||||
Less: Business tax and related surcharges | (81,307) | (21,258) | (60,049) | (97,003) | (23,683) | (73,320) | (90,149) | (14,470) | (21,370) | (68,779) | (249,274) | (21,258) | (228,016) | (353,418) | (56,728) | (87,218) | (266,200) | |||||||||||||||||
Net revenues | 1,228,593 | 346,365 | 882,228 | 1,501,407 | 375,182 | 1,126,225 | 1,375,533 | 220,788 | 343,675 | 1,031,858 | 3,710,452 | 346,365 | 3,364,087 | 5,416,317 | 869,378 | 1,381,348 | 4,034,969 | |||||||||||||||||
Operating costs and expenses: | ||||||||||||||||||||||||||||||||||
Leased-and-operated hotel costs - | ||||||||||||||||||||||||||||||||||
Rents and utilities | (452,605) | (160,964) | (291,641) | (496,559) | (165,845) | (330,714) | (514,213) | (82,537) | (158,565) | (355,648) | (1,232,662) | (160,964) | (1,071,698) | (1,953,243) | (313,517) | (631,320) | (1,321,923) | |||||||||||||||||
Personnel costs | (224,501) | (65,606) | (158,895) | (269,260) | (76,527) | (192,733) | (245,909) | (39,471) | (67,833) | (178,076) | (657,155) | (65,606) | (591,549) | (1,037,371) | (166,510) | (296,889) | (740,482) | |||||||||||||||||
Depreciation and amortization | (139,023) | (46,012) | (93,011) | (156,294) | (41,830) | (114,464) | (158,078) | (25,373) | (39,707) | (118,371) | (398,914) | (46,012) | (352,902) | (612,789) | (98,359) | (169,482) | (443,307) | |||||||||||||||||
Consumables, food and beverage | (104,687) | (40,518) | (64,169) | (96,555) | (25,258) | (71,297) | (99,834) | (16,024) | (28,013) | (71,821) | (258,120) | (40,518) | (217,602) | (351,338) | (56,394) | (94,911) | (256,427) | |||||||||||||||||
Others | (145,826) | (43,783) | (102,043) | (195,247) | (58,254) | (136,993) | (190,804) | (30,626) | (70,846) | (119,958) | (413,815) | (43,783) | (370,032) | (687,254) | (110,312) | (230,597) | (456,657) | |||||||||||||||||
Total leased-and-operated hotel costs | (1,066,642) | (356,883) | (709,759) | (1,213,915) | (367,715) | (846,200) | (1,208,838) | (194,031) | (364,964) | (843,874) | (2,960,666) | (356,883) | (2,603,783) | (4,641,995) | (745,092) | (1,423,199) | (3,218,796) | |||||||||||||||||
Personnel costs of Franchised-and-managed | (20,083) | (2,335) | (17,748) | (45,046) | (7,894) | (37,152) | (24,581) | (3,946) | (3,746) | (20,835) | (72,009) | (2,335) | (69,674) | (125,031) | (20,069) | (21,303) | (103,728) | |||||||||||||||||
Sales and marketing expenses | (19,574) | (3,557) | (16,017) | (18,351) | (2,405) | (15,946) | (24,793) | (3,980) | (3,785) | (21,008) | (44,451) | (3,557) | (40,894) | (76,878) | (12,340) | (11,317) | (65,561) | |||||||||||||||||
General and administrative expenses | (89,088) | (13,858) | (75,230) | (77,850) | (9,221) | (68,629) | (83,408) | (13,388) | (9,828) | (73,580) | (335,888) | (13,858) | (322,030) | (315,235) | (50,599) | (51,145) | (264,090) | |||||||||||||||||
Total operating costs and expenses | (1,195,387) | (376,633) | (818,754) | (1,355,162) | (387,235) | (967,927) | (1,341,620) | (215,345) | (382,323) | (959,297) | (3,413,014) | (376,633) | (3,036,381) | (5,159,139) | (828,100) | (1,506,964) | (3,652,175) | |||||||||||||||||
Other income | - | - | - | 7,742 | 239 | 7,503 | 2,341 | 376 | 299 | 2,042 | - | - | - | 16,558 | 2,658 | 1,713 | 14,845 | |||||||||||||||||
Income/(loss) from operations | 33,206 | (30,268) | 63,474 | 153,987 | (11,814) | 165,801 | 36,254 | 5,819 | (38,349) | 74,603 | 297,438 | (30,268) | 327,706 | 273,736 | 43,936 | (123,903) | 397,639 | |||||||||||||||||
Interest income | 11,497 | 1,773 | 9,724 | 615 | 190 | 425 | 861 | 138 | 176 | 685 | 31,996 | 1,773 | 30,223 | 11,874 | 1,906 | 1,001 | 10,873 | |||||||||||||||||
Interest expenses | (28,313) | (630) | (27,683) | (27,182) | (177) | (27,005) | (17,393) | (2,792) | (150) | (17,243) | (46,868) | (630) | (46,238) | (119,416) | (19,168) | (758) | (118,658) | |||||||||||||||||
Loss from equity investment | - | - | - | (466) | (467) | - | (493) | (79) | (493) | - | - | - | - | (2,305) | (370) | (2,305) | - | |||||||||||||||||
Gain/(loss) on change in fair value of convertible notes | 35,966 | - | 35,966 | (26,765) | - | (26,765) | (45,356) | (7,280) | - | (45,356) | 198,547 | - | 198,547 | (87,099) | (13,980) | - | (87,099) | |||||||||||||||||
Gain on buy-back of convertible bonds | - | - | - | - | - | - | - | - | - | - | 1,521 | - | 1,521 | - | - | - | - | |||||||||||||||||
Non-operating income | 4,895 | 2,927 | 1,968 | 11,044 | 2,136 | 8,908 | 19,683 | 3,160 | 2,113 | 17,570 | 35,899 | 2,927 | 32,972 | 47,986 | 7,702 | 6,705 | 41,281 | |||||||||||||||||
Non-operating expenses | (7,315) | - | (7,315) | (7,818) | - | (7,818) | - | - | - | - | (7,315) | - | (7,315) | (11,403) | (1,830) | - | (11,403) | |||||||||||||||||
Foreign exchange gain/(loss), net | 18,495 | 548 | 17,947 | (6,748) | (212) | (6,536) | 14,974 | 2,403 | 595 | 14,379 | 15,849 | 548 | 15,301 | 217 | 35 | (410) | 627 | |||||||||||||||||
Income/(loss) before income tax expenses and noncontrolling interests | 68,431 | (25,650) | 94,081 | 96,667 | (10,344) | 107,010 | 8,530 | 1,369 | (36,108) | 44,638 | 527,067 | (25,650) | 552,717 | 113,590 | 18,231 | (119,670) | 233,260 | |||||||||||||||||
Income tax (expense)/benefit | (33,815) | 8,134 | (41,949) | (62,255) | (4,239) | (58,016) | (964) | (155) | 38,003 | (38,967) | (169,442) | 8,134 | (177,576) | (136,305) | (21,878) | 34,481 | (170,786) | |||||||||||||||||
Net income/(loss) | 34,616 | (17,516) | 52,132 | 34,412 | (14,583) | 48,994 | 7,566 | 1,214 | 1,895 | 5,671 | 357,625 | (17,516) | 375,141 | (22,715) | (3,647) | (85,189) | 62,474 | |||||||||||||||||
Less:Net income attributable to noncontrolling interests | (1,957) | - | (1,957) | (703) | - | (703) | (1,286) | (206) | - | (1,286) | (6,094) | - | (6,094) | (4,061) | (652) | - | (4,061) | |||||||||||||||||
Net income/(loss) attributable to Home Inns Group's shareholders | 32,659 | (17,516) | 50,175 | 33,709 | (14,583) | 48,291 | 6,280 | 1,008 | 1,895 | 4,385 | 351,531 | (17,516) | 369,047 | (26,776) | (4,299) | (85,189) | 58,413 | |||||||||||||||||
Earnings per share | ||||||||||||||||||||||||||||||||||
- Basic | 0.36 | 0.55 | 0.37 | 0.53 | 0.07 | 0.01 | 0.05 | 4.17 | 4.38 | (0.29) | (0.05) | 0.64 | ||||||||||||||||||||||
- Diluted | (0.06) | 0.11 | 0.37 | 0.52 | 0.07 | 0.01 | 0.05 | 1.26 | 1.44 | (0.29) | (0.05) | 0.63 | ||||||||||||||||||||||
Weighted average ordinary shares outstanding | ||||||||||||||||||||||||||||||||||
- Basic | 90,596 | 90,596 | 90,771 | 90,771 | 91,027 | 91,027 | 91,027 | 84,222 | 84,222 | 90,805 | 90,805 | 90,805 | ||||||||||||||||||||||
- Diluted | 99,672 | 99,672 | 92,600 | 92,600 | 92,445 | 92,445 | 92,445 | 94,299 | 94,299 | 90,805 | 90,805 | 92,222 | ||||||||||||||||||||||
Share-based compensation expense was included in the statement of operations as follows: | ||||||||||||||||||||||||||||||||||
Leased-and-operated hotel costs - Personnel costs | 1,637 | 1,637 | 2,025 | 261 | 1,764 | 2,038 | 327 | 241 | 1,797 | 3,283 | 3,283 | 8,199 | 1,316 | 963 | 7,236 | |||||||||||||||||||
Personnel costs of Franchised-and-managed hotels | 1,709 | 1,709 | 2,410 | 313 | 2,097 | 2,476 | 397 | 292 | 2,184 | 3,369 | 3,369 | 9,578 | 1,537 | 1,155 | 8,423 | |||||||||||||||||||
Sales and marketing expenses | 317 | 317 | 407 | - | 407 | 354 | 57 | - | 354 | 656 | 656 | 1,535 | 246 | - | 1,535 | |||||||||||||||||||
General and administrative expenses | 15,831 | 15,831 | 19,195 | 545 | 18,650 | 17,620 | 2,828 | 671 | 16,949 | 69,227 | 69,227 | 74,064 | 11,888 | 2,182 | 71,882 | |||||||||||||||||||
Note 1: The conversion of Renminbi ("RMB") into United States dollars ("US$") is based on rate of US$1.00=RMB6.2301 on December 31, 2012, representing the certificated exchange rate published by the Federal Reserve Board. | ||||||||||||||||||||||||||||||||||
Home Inns & Hotels Management Inc. | ||||||||||||||||||||||||||||||||
Reconciliation of GAAP and Non-GAAP Results | ||||||||||||||||||||||||||||||||
Quarter Ended December 31, 2012 | Quarter Ended December 31, 2012(excluding Motel 168) | |||||||||||||||||||||||||||||||
GAAP | %ofTotal | Share-based | Acquisition | Integration | %ofTotal | Non-GAAP Result | %ofTotal | GAAP | %ofTotal | Share-based | Acquisition | Integration | %ofTotal | Non-GAAP Result | %ofTotal | |||||||||||||||||
RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | |||||||||||||||||||||||
(unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | |||||||||||||||||||||||
Leased-and-operated hotel costs | (1,208,838) | 82.5% | 2,038 | - | 19,933 | 1.5% | (1,186,867) | 81.0% | (843,874) | 76.7% | 1,797 | - | 107 | 0.2% | (841,970) | 76.5% | ||||||||||||||||
Personnel costs of Franchised-and-managed hotels | (24,581) | 1.7% | 2,476 | - | - | 0.2% | (22,105) | 1.5% | (20,835) | 1.9% | 2,184 | - | - | 0.2% | (18,651) | 1.7% | ||||||||||||||||
Sales and marketing expenses | (24,793) | 1.7% | 354 | - | - | 0.0% | (24,439) | 1.7% | (21,008) | 1.9% | 354 | - | - | 0.0% | (20,654) | 1.9% | ||||||||||||||||
General and administrative expenses | (83,408) | 5.7% | 17,620 | - | 558 | 1.2% | (65,230) | 4.5% | (73,580) | 6.7% | 16,949 | - | - | 1.5% | (56,631) | 5.1% | ||||||||||||||||
Total operating costs and expenses | (1,341,620) | 91.5% | 22,488 | - | 20,491 | 2.9% | (1,298,641) | 88.6% | (959,297) | 87.2% | 21,284 | - | 107 | 1.9% | (937,906) | 85.2% | ||||||||||||||||
Income from operations | 36,254 | 2.5% | 22,488 | - | 20,491 | 2.9% | 79,233 | 5.4% | 74,603 | 6.8% | 21,284 | - | 107 | 1.9% | 95,994 | 8.7% | ||||||||||||||||
Quarter Ended December 31, 2012 | Quarter Ended December 31, 2012(excluding Motel 168) | |||||||||||||||||||||||||||||||
GAAP | % of Total | Share-based | Acquisition | Integration | % of Total | Non-GAAP Result | % of Total | GAAP | %of Total | Share-based | Acquisition | Integration | % of Total | Non-GAAP Result | % of Total | |||||||||||||||||
US$ '000 | US$ '000 | US$ '000 | US$ '000 | US$ '000 | US$ '000 | US$ '000 | US$ '000 | US$ '000 | US$ '000 | |||||||||||||||||||||||
(unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) |
(unaudited) | (unaudited) | (unaudited) | |||||||||||||||||||||||
Leased-and-operated hotel costs | (194,031) | 82.5% | 327 | - | 3,199 | 1.5% | (190,505) | 81.0% | (135,451) | 76.7% | 288 | - | 17 | 0.2% | (135,145) | 76.5% | ||||||||||||||||
Personnel costs of Franchised-and-managed hotels | (3,946) | 1.7% | 397 | - | - | 0.2% | (3,549) | 1.5% | (3,344) | 1.9% | 351 | - | - | 0.2% | (2,994) | 1.7% | ||||||||||||||||
Sales and marketing expenses | (3,980) | 1.7% | 57 | - | - | 0.0% | (3,923) | 1.7% | (3,372) | 1.9% | 57 | - | - | 0.0% | (3,315) | 1.9% | ||||||||||||||||
General and administrative expenses | (13,388) | 5.7% | 2,828 | - | 90 | 1.2% | (10,470) | 4.5% | (11,810) | 6.7% | 2,721 | - | - | 1.5% | (9,090) | 5.1% | ||||||||||||||||
Total operating costs and expenses | (215,345) | 91.5% | 3,610 | - | 3,289 | 2.9% | (208,446) | 88.6% | (153,978) | 87.2% | 3,416 | - | 17 | 1.9% | (150,544) | 85.2% | ||||||||||||||||
Income from operations | 5,819 | 2.5% | 3,610 | - | 3,289 | 2.9% | 12,718 | 5.4% | 11,975 | 6.8% | 3,416 | - | 17 | 1.9% | 15,408 | 8.7% | ||||||||||||||||
Quarter Ended September 30, 2012 | Quarter Ended September 30, 2012(excluding Motel 168) | |||||||||||||||||||||||||||||||
GAAP | % of Total | Share-based | Acquisition | Integration | % of Total | Non-GAAP Result | % of Total | GAAP | % of Total | Share-based | Acquisition | Integration | % of Total | Non-GAAP Result | % of Total | |||||||||||||||||
RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | |||||||||||||||||||||||
(unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | |||||||||||||||||||||||
Leased-and-operated hotel costs | (1,213,915) | 75.9% | 2,025 | - | 25,406 | 1.7% | (1,186,484) | 74.2% | (846,200) | 70.5% | 1,764 | - | 7,714 | 0.8% | (836,722) | 69.8% | ||||||||||||||||
Personnel costs of Franchised-and-managed hotels | (45,046) | 2.8% | 2,410 | - | - | 0.2% | (42,636) | 2.7% | (37,152) | 3.1% | 2,097 | - | - | 0.2% | (35,055) | 2.9% | ||||||||||||||||
Sales and marketing expenses | (18,351) | 1.1% | 407 | - | - | 0.0% | (17,944) | 1.1% | (15,946) | 1.3% | 407 | - | - | 0.0% | (15,539) | 1.3% | ||||||||||||||||
General and administrative expenses | (77,850) | 4.9% | 19,195 | - | 1,224 | 1.3% | (57,431) | 3.6% | (68,629) | 5.7% | 18,650 | - | - | 1.6% | (49,979) | 4.2% | ||||||||||||||||
Total operating costs and expenses | (1,355,162) | 84.8% | 24,037 | - | 26,630 | 3.2% | (1,304,495) | 81.6% | (967,927) | 80.7% | 22,918 | - | 7,714 | 2.6% | (937,295) | 78.1% | ||||||||||||||||
Income from operations | 153,987 | 9.6% | 24,037 | - | 26,630 | 3.2% | 204,654 | 12.8% | 165,801 | 13.8% | 22,918 | - | 7,714 | 2.6% | 196,433 | 16.4% | ||||||||||||||||
Quarter Ended December 31, 2011 | Quarter Ended December 31, 2011(excluding Motel 168) | |||||||||||||||||||||||||||||||
GAAP | % of Total | Share-based | Acquisition | Integration | % of Total | Non-GAAP Result | % of Total | GAAP | % of Total | Share-based | Acquisition | Integration | % of Total | Non-GAAP Result | % of Total | |||||||||||||||||
RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | |||||||||||||||||||||||
(unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | |||||||||||||||||||||||
Leased-and-operated hotel costs | (1,066,642) | 81.4% | 1,637 | - | 14,635 | 1.2% | (1,050,370) | 80.2% | (709,759) | 75.3% | 1,637 | - | - | 0.2% | (708,122) | 75.2% | ||||||||||||||||
Personnel costs of Franchised-and-managed hotels | (20,083) | 1.5% | 1,709 | - | - | 0.1% | (18,374) | 1.4% | (17,748) | 1.9% | 1,709 | - | - | 0.2% | (16,039) | 1.7% | ||||||||||||||||
Sales and marketing expenses | (19,574) | 1.5% | 317 | - | - | 0.0% | (19,257) | 1.5% | (16,017) | 1.7% | 317 | - | - | 0.0% | (15,700) | 1.7% | ||||||||||||||||
General and administrative expenses | (89,088) | 6.8% | 15,831 | 6,295 | 4,870 | 2.1% | (62,092) | 4.7% | (75,230) | 8.0% | 15,831 | 6,295 | - | 2.3% | (53,104) | 5.6% | ||||||||||||||||
Total operating costs and expenses | (1,195,387) | 91.3% | 19,494 | 6,295 | 19,505 | 3.5% | (1,150,093) | 87.8% | (818,754) | 86.9% | 19,494 | 6,295 | - | 2.7% | (792,965) | 84.2% | ||||||||||||||||
Income from operations | 33,206 | 2.5% | 19,494 | 6,295 | 19,505 | 3.5% | 78,500 | 6.0% | 63,474 | 6.7% | 19,494 | 6,295 | - | 2.7% | 89,263 | 9.5% | ||||||||||||||||
Year Ended December 31, 2012 | Year Ended December 31, 2012(excluding Motel 168) | |||||||||||||||||||||||||||||||
GAAP | %of Total | Share-based | Acquisition | Integration | %of Total | Non-GAAP Result | %of Total | GAAP | %of Total | Share-based | Acquisition | Integration | %of Total | Non-GAAP Result | %of Total | |||||||||||||||||
RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | |||||||||||||||||||||||
(unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | |||||||||||||||||||||||
Leased-and-operated hotel costs | (4,641,995) | 80.5% | 8,199 | - | 83,744 | 1.6% | (4,550,052) | 78.9% | (3,218,796) | 74.8% | 7,236 | - | 7,821 | 0.4% | (3,203,739) | 74.5% | ||||||||||||||||
Personnel costs of Franchised-and-managed hotels | (125,031) | 2.2% | 9,578 | - | - | 0.2% | (115,453) | 2.0% | (103,728) | 2.4% | 8,423 | - | - | 0.2% | (95,305) | 2.2% | ||||||||||||||||
Sales and marketing expenses | (76,878) | 1.3% | 1,535 | - | 48 | 0.0% | (75,295) | 1.3% | (65,561) | 1.5% | 1,535 | - | - | 0.0% | (64,026) | 1.5% | ||||||||||||||||
General and administrative expenses | (315,235) | 5.5% | 74,064 | - | 13,160 | 1.5% | (228,011) | 4.0% | (264,090) | 6.1% | 71,882 | - | - | 1.7% | (192,208) | 4.5% | ||||||||||||||||
Total operating costs and expenses | (5,159,139) | 89.4% | 93,376 | - | 96,952 | 3.3% | (4,968,811) | 86.1% | (3,652,175) | 84.9% | 89,076 | - | 7,821 | 2.3% | (3,555,278) | 82.7% | ||||||||||||||||
Income from operations | 273,736 | 4.7% | 93,376 | - | 96,952 | 3.3% | 464,064 | 8.0% | 397,639 | 9.2% | 89,076 | - | 7,821 | 2.3% | 494,536 | 11.5% | ||||||||||||||||
Year Ended December 31, 2012 | Year Ended December 31, 2012(excluding Motel 168) | |||||||||||||||||||||||||||||||
GAAP | % of Total | Share-based | Acquisition | Integration | % of Total | Non-GAAP Result | % of Total | GAAP | % of Total | Share-based | Acquisition | Integration | % of Total | Non-GAAP Result | %of Total | |||||||||||||||||
US$ '000 | US$ '000 | US$ '000 | US$ '000 | US$ '000 | US$ '000 | US$ '000 | US$ '000 | US$ '000 | US$ '000 | |||||||||||||||||||||||
(unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | |||||||||||||||||||||||
Leased-and-operated hotel costs | (745,092) | 80.5% | 1,316 | - | 13,442 | 1.6% | (730,334) | 78.9% | (516,652) | 74.8% | 1,161 | - | 1,255 | 0.4% | (514,236) | 74.5% | ||||||||||||||||
Personnel costs of Franchised-and-managed hotels | (20,069) | 2.2% | 1,537 | - | - | 0.2% | (18,532) | 2.0% | (16,649) | 2.4% | 1,352 | - | - | 0.2% | (15,297) | 2.2% | ||||||||||||||||
Sales and marketing expenses | (12,340) | 1.3% | 246 | - | 8 | 0.0% | (12,086) | 1.3% | (10,523) | 1.5% | 246 | - | - | 0.0% | (10,277) | 1.5% | ||||||||||||||||
General and administrative expenses | (50,599) | 5.5% | 11,888 | - | 2,112 | 1.5% | (36,599) | 4.0% | (42,389) | 6.1% | 11,538 | - | - | 1.7% | (30,851) | 4.5% | ||||||||||||||||
Total operating costs and expenses | (828,100) | 89.4% | 14,987 | - | 15,562 | 3.3% | (797,551) | 86.1% | (586,213) | 84.9% | 14,297 | - | 1,255 | 2.3% | (570,661) | 82.7% | ||||||||||||||||
Income from operations | 43,936 | 4.7% | 14,987 | - | 15,562 | 3.3% | 74,485 | 8.0% | 63,825 | 9.2% | 14,297 | - | 1,255 | 2.3% | 79,377 | 11.5% | ||||||||||||||||
Year Ended December 31, 2011 | Year Ended December 31, 2011(excluding Motel 168) | |||||||||||||||||||||||||||||||
GAAP | % of Total | Share-based | Acquisition | Integration | % of Total | Non-GAAP Result | % of Total | GAAP | % of Total | Share-based | Acquisition | Integration | % of Total | Non-GAAP Result | % of Total | |||||||||||||||||
RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | RMB '000 | |||||||||||||||||||||||
(unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | |||||||||||||||||||||||
Leased-and-operated hotel costs | (2,960,666) | 74.8% | 3,283 | - | 14,635 | 0.5% | (2,942,748) | 74.3% | (2,603,783) | 72.5% | 3,283 | - | - | 0.1% | (2,600,500) | 72.4% | ||||||||||||||||
Personnel costs of Franchised-and-managed hotels | (72,009) | 1.8% | 3,369 | - | - | 0.1% | (68,640) | 1.7% | (69,674) | 1.9% | 3,369 | - | - | 0.1% | (66,305) | 1.8% | ||||||||||||||||
Sales and marketing expenses | (44,451) | 1.1% | 656 | - | - | 0.0% | (43,795) | 1.1% | (40,894) | 1.1% | 656 | - | - | 0.0% | (40,238) | 1.1% | ||||||||||||||||
General and administrative expenses | (335,888) | 8.5% | 69,227 | 63,824 | 4,870 | 3.5% | (197,967) | 5.0% | (322,030) | 9.0% | 69,227 | 63,824 | - | 3.7% | (188,979) | 5.3% | ||||||||||||||||
Total operating costs and expenses | (3,413,014) | 86.2% | 76,535 | 63,824 | 19,505 | 4.0% | (3,253,150) | 82.2% | (3,036,381) | 84.5% | 76,535 | 63,824 | - | 3.9% | (2,896,022) | 80.6% | ||||||||||||||||
Income from operations | 297,438 | 7.5% | 76,535 | 63,824 | 19,505 | 4.0% | 457,302 | 11.5% | 327,706 | 9.1% | 76,535 | 63,824 | - | 3.9% | 468,065 | 13.0% | ||||||||||||||||
Note 1: The conversion of Renminbi ("RMB") into United States dollars ("US$") is based on rate of US$1.00=RMB6.2301 on December 31, 2012, representing the certificated exchange rate published by the Federal Reserve Board. | ||||||||||||||||||||||||||||||||
Home Inns & Hotels Management Inc. | |||||||||||||||||||||||||||||||||||||||||
Reconciliation of GAAP and Non-GAAP Results (continued) | |||||||||||||||||||||||||||||||||||||||||
Quarter Ended | Year Ended | ||||||||||||||||||||||||||||||||||||||||
December 31, 2011 | September 30, 2012 | December 31, 2012 | December 31, 2011 | December 31, 2012 | |||||||||||||||||||||||||||||||||||||
RMB '000 | RMB'000 | RMB '000 | RMB'000 | RMB '000 | US$ '000 | RMB'000 | RMB '000 | RMB'000 | RMB '000 | US$ '000 | RMB'000 | ||||||||||||||||||||||||||||||
(unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | ||||||||||||||||||||||||||||||
Net income/(loss) attributable to Home Inns Group's shareholders (GAAP) | 32,659 | 50,175 | 33,709 | 48,291 | 6,280 | 1,008 | 4,385 | 351,531 | 369,047 | (26,776) | (4,299) | 58,413 | |||||||||||||||||||||||||||||
Foreign exchange loss, net | (18,495) | (17,947) | 6,748 | 6,536 | (14,974) | (2,403) | (14,379) | (15,849) | (15,301) | (217) | (35) | (627) | |||||||||||||||||||||||||||||
Share-based compensation | 19,494 | 19,494 | 24,037 | 22,918 | 22,488 | 3,610 | 21,284 | 76,535 | 76,535 | 93,376 | 14,987 | 89,076 | |||||||||||||||||||||||||||||
Gain on buy-back of convertible bonds | - | - | - | - | - | - | - | (1,521) | (1,521) | - | - | - | |||||||||||||||||||||||||||||
Acquisition expenses - Motel 168 | 6,295 | 6,295 | - | - | - | - | - | 63,824 | 63,824 | - | - | - | |||||||||||||||||||||||||||||
Integration cost | 19,505 | - | 26,630 | 7,714 | 20,491 | 3,289 | 107 | 19,505 | - | 96,952 | 15,562 | 7,821 | |||||||||||||||||||||||||||||
Interest expenses - Upfront fee amortization of term loans | 5,821 | 5,821 | 10,126 | 10,126 | 2,013 | 323 | 2,013 | 5,821 | 5,821 | 43,250 | 6,942 | 43,250 | |||||||||||||||||||||||||||||
Non-operating (income)/expenses - (Gain)/loss on change in | 7,315 | 7,315 | 7,818 | 7,818 | (1,049) | (168) | (1,049) | 7,315 | 7,315 | 6,665 | 1,070 | 6,665 | |||||||||||||||||||||||||||||
(Gain)/loss on change in fair value of convertible notes | (35,966) | (35,966) | 26,765 | 26,765 | 45,356 | 7,280 | 45,356 | (198,547) | (198,547) | 87,099 | 13,980 | 87,099 | |||||||||||||||||||||||||||||
Withholding tax for profit distribution of previous periods | - | - | - | - | - | - | - | 17,469 | 17,469 | - | - | - | |||||||||||||||||||||||||||||
Adjusted net income attributable to Home Inns Group's shareholders (Non-GAAP) | 36,628 | 35,187 | 135,833 | 130,168 | 80,605 | 12,939 | 57,717 | 326,083 | 324,642 | 300,349 | 48,207 | 291,697 | |||||||||||||||||||||||||||||
Quarter Ended | Year Ended | ||||||||||||||||||||||||||||||||||||||||
December 31, 2011 | September 30, 2012 | December 31, 2012 | December 31, 2011 | December 31, 2012 | |||||||||||||||||||||||||||||||||||||
RMB '000 | RMB'000 | RMB '000 | RMB'000 | RMB '000 | US$ '000 | RMB'000 | RMB '000 | RMB'000 | RMB '000 | US$ '000 | RMB'000 | ||||||||||||||||||||||||||||||
(unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | ||||||||||||||||||||||||||||||
Earnings per share (GAAP) | |||||||||||||||||||||||||||||||||||||||||
- Basic | 0.36 | 0.55 | 0.37 | 0.53 | 0.07 | 0.01 | 0.05 | 4.17 | 4.38 | (0.29) | (0.05) | 0.64 | |||||||||||||||||||||||||||||
- Diluted | (0.06) | 0.11 | 0.37 | 0.52 | 0.07 | 0.01 | 0.05 | 1.26 | 1.44 | (0.29) | (0.05) | 0.63 | |||||||||||||||||||||||||||||
Weighted average ordinary shares outstanding | |||||||||||||||||||||||||||||||||||||||||
- Basic | 90,596 | 90,596 | 90,771 | 90,771 | 91,027 | 91,027 | 91,027 | 84,222 | 84,222 | 90,805 | 90,805 | 90,805 | |||||||||||||||||||||||||||||
- Diluted | 99,672 | 99,672 | 92,600 | 92,600 | 92,445 | 92,445 | 92,445 | 94,299 | 94,299 | 90,805 | 90,805 | 92,222 | |||||||||||||||||||||||||||||
Adjusted earnings per share (Non-GAAP) | |||||||||||||||||||||||||||||||||||||||||
- Basic | 0.40 | 0.39 | 1.50 | 1.43 | 0.89 | 0.14 | 0.63 | 3.87 | 3.85 | 3.31 | 0.53 | 3.21 | |||||||||||||||||||||||||||||
- Diluted | 0.37 | 0.35 | 1.47 | 1.41 | 0.87 | 0.14 | 0.62 | 3.46 | 3.44 | 3.31 | 0.53 | 3.16 | |||||||||||||||||||||||||||||
Weighted average ordinary shares outstanding | |||||||||||||||||||||||||||||||||||||||||
- Basic | 90,596 | 90,596 | 90,771 | 90,771 | 91,027 | 91,027 | 91,027 | 84,222 | 84,222 | 90,805 | 90,805 | 90,805 | |||||||||||||||||||||||||||||
- Diluted | 99,672 | 99,672 | 92,600 | 92,600 | 92,445 | 92,445 | 92,445 | 94,299 | 94,299 | 90,805 | 90,805 | 92,222 | |||||||||||||||||||||||||||||
Note 1: The conversion of Renminbi ("RMB") into United States dollars ("US$") is based on rate of US$1.00=RMB6.2301 on December 31, 2012, representing the certificated exchange rate published by the Federal Reserve Board. | |||||||||||||||||||||||||||||||||||||||||
Note 2: The non-GAAP adjustment items do not include the tax impact. | |||||||||||||||||||||||||||||||||||||||||
Home Inns & Hotels Management Inc. | |||||||||||||||||||||||||||||||||||||||||
Reconciliation of GAAP and Non-GAAP Results (continued) | |||||||||||||||||||||||||||||||||||||||||
Quarter Ended | Year Ended | ||||||||||||||||||||||||||||||||||||||||
December 31, 2011 | September 30, 2012 | December 31, 2012 | December 31, 2011 | December 31, 2012 | |||||||||||||||||||||||||||||||||||||
RMB '000 | RMB'000 | RMB '000 | RMB'000 | RMB '000 | US$ '000 | RMB'000 | RMB '000 | RMB'000 | RMB '000 | US$ '000 | RMB'000 | ||||||||||||||||||||||||||||||
(unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | ||||||||||||||||||||||||||||||
Net income/(loss) attributable to Home Inns Group's shareholders | 32,659 | 50,175 | 33,709 | 48,291 | 6,280 | 1,008 | 4,385 | 351,531 | 369,047 | (26,776) | (4,299) | 58,413 | |||||||||||||||||||||||||||||
Interest income | (11,497) | (9,724) | (615) | (425) | (861) | (138) | (685) | (31,996) | (30,223) | (11,874) | (1,906) | (10,873) | |||||||||||||||||||||||||||||
Interest expenses | 28,313 | 27,683 | 27,182 | 27,005 | 17,393 | 2,792 | 17,243 | 46,868 | 46,238 | 119,416 | 19,168 | 118,658 | |||||||||||||||||||||||||||||
Income tax expense | 33,815 | 41,949 | 62,255 | 58,016 | 964 | 155 | 38,967 | 169,442 | 177,576 | 136,305 | 21,878 | 170,786 | |||||||||||||||||||||||||||||
Depreciation and amortization | 145,941 | 98,485 | 161,006 | 117,680 | 164,376 | 26,384 | 123,097 | 413,105 | 365,649 | 632,468 | 101,518 | 457,300 | |||||||||||||||||||||||||||||
EBITDA (Non-GAAP) | 229,231 | 208,568 | 283,537 | 250,567 | 188,152 | 30,201 | 183,007 | 948,950 | 928,287 | 849,539 | 136,359 | 794,284 | |||||||||||||||||||||||||||||
Foreign exchange loss, net | (18,495) | (17,947) | 6,748 | 6,536 | (14,974) | (2,403) | (14,379) | (15,849) | (15,301) | (217) | (35) | (627) | |||||||||||||||||||||||||||||
Share-based compensation | 19,494 | 19,494 | 24,037 | 22,918 | 22,488 | 3,610 | 21,284 | 76,535 | 76,535 | 93,376 | 14,987 | 89,076 | |||||||||||||||||||||||||||||
Gain on buy-back of convertible bonds | - | - | - | - | - | - | - | (1,521) | (1,521) | - | - | - | |||||||||||||||||||||||||||||
Acquisition expenses - Motel 168 | 6,295 | 6,295 | - | - | - | - | - | 63,824 | 63,824 | - | - | - | |||||||||||||||||||||||||||||
Integration cost | 19,505 | - | 26,630 | 7,714 | 20,491 | 3,289 | 107 | 19,505 | - | 96,952 | 15,562 | 7,821 | |||||||||||||||||||||||||||||
Non-operating (income)/expenses - (Gain)/loss on change in | 7,315 | 7,315 | 7,818 | 7,818 | (1,049) | (168) | (1,049) | 7,315 | 7,315 | 6,665 | 1,070 | 6,665 | |||||||||||||||||||||||||||||
(Gain)/loss on change in fair value of convertible notes | (35,966) | (35,966) | 26,765 | 26,765 | 45,356 | 7,280 | 45,356 | (198,547) | (198,547) | 87,099 | 13,980 | 87,099 | |||||||||||||||||||||||||||||
Adjusted EBITDA (Non-GAAP) | 227,379 | 187,759 | 375,535 | 322,318 | 260,464 | 41,809 | 234,326 | 900,212 | 860,592 | 1,133,414 | 181,923 | 984,318 | |||||||||||||||||||||||||||||
%of total revenue | 17.4% | 19.9% | 23.5% | 26.9% | 17.8% | 17.8% | 21.3% | 22.7% | 24.0% | 19.6% | 19.6% | 22.9% | |||||||||||||||||||||||||||||
Note 1: The "Depreciation and amortization expense" includes the depreciation and amortization expenses of the Group. | |||||||||||||||||||||||||||||||||||||||||
The depreciation and amortization expenses of all leased-and-operated hotels are included in "Operating costs and expenses". | |||||||||||||||||||||||||||||||||||||||||
The depreciation and amortization expenses of administrative long-term assets are included in "General and administrative expenses". | |||||||||||||||||||||||||||||||||||||||||
Home Inns & Hotels Management Inc. | ||||||||||||||||||||||||||||||
Operating Data | ||||||||||||||||||||||||||||||
As of and for the quarter ended | As of and for the year ended | |||||||||||||||||||||||||||||
December 31, 2011 | September 30, 2012 | December 31, 2012 | December 31, 2011 | December 31, 2012 | ||||||||||||||||||||||||||
Group | Motel 168 | excluding Motel 168 | Group | Motel 168 | excluding Motel 168 | Group | Motel 168 | excluding Motel 168 | Group | Motel 168 | excluding Motel 168 | Group | Motel 168 | excluding Motel 168 | ||||||||||||||||
Total Hotels in operation: | 1,426 | 307 | 1,119 | 1,682 | 321 | 1,361 | 1,772 | 334 | 1,438 | 1,426 | 307 | 1,119 | 1,772 | 334 | 1,438 | |||||||||||||||
Leased-and-operated hotels | 698 | 144 | 554 | 770 | 146 | 624 | 803 | 151 | 652 | 698 | 144 | 554 | 803 | 151 | 652 | |||||||||||||||
Franchised-and-managed hotels | 728 | 163 | 565 | 912 | 175 | 737 | 969 | 183 | 786 | 728 | 163 | 565 | 969 | 183 | 786 | |||||||||||||||
Total rooms | 176,562 | 47,941 | 128,621 | 204,678 | 48,619 | 156,059 | 214,070 | 49,745 | 164,325 | 176,562 | 47,941 | 128,621 | 214,070 | 49,745 | 164,325 | |||||||||||||||
Occupancy rate (as a percentage) | 84.2% | 73.5% | 88.4% | 90.3% | 82.7% | 92.7% | 83.8% | 77.4% | 85.6% | 88.8% | 73.5% | 90.3% | 86.1% | 78.0% | 88.7% | |||||||||||||||
Average daily rate (in RMB) | 168 | 154 | 173 | 174 | 162 | 177 | 165 | 160 | 166 | 172 | 154 | 173 | 168 | 160 | 170 | |||||||||||||||
RevPAR (in RMB) | 141 | 113 | 153 | 157 | 134 | 164 | 138 | 124 | 143 | 152 | 113 | 156 | 144 | 125 | 151 | |||||||||||||||
Like-for-like performance for hotels opened for at least 18 months during the current quarter | ||||||||||||||||||||||||||||||
As of and for the quarter ended | ||||||||||||||||||||||||||||||
December 31, 2011 | December 31, 2012 | |||||||||||||||||||||||||||||
Group | Motel 168 | excluding Motel 168 | Group | Motel 168 | excluding Motel 168 | |||||||||||||||||||||||||
Total Hotels in operation: | 1,201 | 282 | 919 | 1,201 | 282 | 919 | ||||||||||||||||||||||||
Leased-and-operated hotels | 616 | 144 | 472 | 617 | 145 | 472 | ||||||||||||||||||||||||
Franchised-and-managed hotels | 585 | 138 | 447 | 584 | 137 | 447 | ||||||||||||||||||||||||
Total rooms | 139,768 | 34,164 | 105,604 | 140,301 | 33,989 | 106,312 | ||||||||||||||||||||||||
Occupancy rate (as a percentage) | 86.0% | 73.5% | 91.5% | 86.5% | 77.7% | 90.4% | ||||||||||||||||||||||||
Average daily rate (in RMB) | 167 | 154 | 172 | 169 | 161 | 172 | ||||||||||||||||||||||||
RevPAR (in RMB) | 144 | 113 | 158 | 146 | 125 | 156 | ||||||||||||||||||||||||
One Motel 168 Franchised-and-managed hotel was legally converted into Leased-and-operated hotels in 2012. | ||||||||||||||||||||||||||||||
* "Occupancy rate" refers to the total number of occupied rooms divided by the total number of available rooms in a given period. | ||||||||||||||||||||||||||||||
"Average daily rate" refers to total hotel room revenues divided by the total number of occupied rooms in a given period. | ||||||||||||||||||||||||||||||
"RevPAR" represents revenue per available room, which is calculated by dividing total hotel room revenues by the total number of available rooms in a given period, or by multiplying average daily rates and occupancy rates in a given period. | ||||||||||||||||||||||||||||||
SOURCE Home Inns & Hotels Management Inc.
