Ctrip.com has put concerns over escalating trade tensions with the US and a slowing economy to rest with a strong showing in the first quarter results of 2019.
The online giant’s net revenue increased by 21% year-over-year to RMB8.2 billion (US$1.2 billion) in the first quarter of 2019. Income from operations increased by 50% year-over-year to RMB885 million (US$132 million). Excluding share-based compensation charges, non-GAAP income from operations increased by 42% year-over-year to RMB1.4 billion (US$204 million) in the first quarter of 2019.
Its international businesses were highlighted as having “sustained robust growth momentum”. In the first quarter of 2019, revenue generated from international business accounted for approximately 35% of total revenue. Skyscanner’s direct booking program achieved approximately 250% growth in bookings year-over-year in the first quarter of 2019; the growth rate of the international hotel business and international air business (excluding the Skyscanner business) in the first quarter of 2019 more than doubled that of the China outbound traffic growth in the same period.
“Not only do we listen to our customers, we also lead the market as new opportunities emerge. We align our strategy in a prudent manner to suit the market. The great results reflect our determination to create the best travel experience through Ctrip’s one-stop travel platform in the world,” said Ctrip’s chief executive officer Jane Sun.
It’s co-founder and chairman James Liang was quoted in an interview with Nikkei Asian Review saying the trade tensions could actually be an opportunity for growth. He said as a result of the trade tensions, “a lot of Chinese and other companies that serve China as a market need to have closer interaction with Europe or Asian countries, and that can actually increase cross-border activities, including travel, between those countries”.
“We primarily empower our growth organically and create long-term value to stakeholders, focusing on expanding customer base and deepening user engagement. We also have achieved an excellent record of global strategic investments and collaborations. We are excited about our recent MakeMyTrip investment and look forward to achieving greater success and creating more value to our shareholders in the future,” he added.
Some highlights from its financial report
- For the first quarter of 2019, Ctrip reported a net revenue of US$1.2 billion, representing a 21% increase from the same period in 2018. Net revenue for the first quarter of 2019 increased by 8% from the previous quarter, primarily due to seasonality.
- Accommodation reservation revenue for the first quarter of 2019 was US$450 million, representing a 21% increase from the same period in 2018, primarily driven by an increase in accommodation reservation volume. Accommodation reservation revenue for the first quarter of 2019 increased by 14% from the previous quarter, primarily due to seasonality.
- Transportation ticketing revenue for the first quarter of 2019 was US$500 million, representing a 16% increase from the same period in 2018, primarily driven by an increase in ticketing volume. Transportation ticketing revenue for the first quarter of 2019 decreased by 2% from the previous quarter.
- Packaged-tour revenue for the first quarter of 2019 was US$156 million, representing a 25% increase from the same period in 2018, primarily driven by an increase in volume of organised tours and customised tours. Packaged-tour revenue for the first quarter of 2019 increased by 45% from the previous quarter, primarily due to seasonality.
- Corporate travel revenue for the first quarter of 2019 was US$35 million, representing a 32% increase from the same period in 2018, primarily driven by expansion in travel product coverage. Corporate travel revenue for the first quarter of 2019 decreased by 15% from the previous quarter, primarily due to seasonality.
- For the second quarter of 2019, the company expects the net revenue growth to continue at a year-over-year rate of approximately 16 to 21%.
Feature image credit: Getty Images
