Tuniu Announces Unaudited Third Quarter 2021 Financial Results

Author: Tuniu Corporation / 2023-07-23 23:49 / Source: Tuniu Corporation

Tuniu Announces Unaudited Third Quarter 2021 Financial Results

NANJING,China,Nov. 19,2021 --Tuniu Corporation (NASDAQ: TOUR) ("Tuniu" or the "Company"),a leading online leisure travel company in China,today announced its unaudited financial results for the third quarter ended September 30,2021.

"Tuniu's focus on providing high-quality products and services and a high level of customer satisfaction continues to drive results. The transaction volume of our self-operated local tour products saw double digit year-on-year growth for the quarter even as the recovery of the overall tourism industry experienced setbacks. Looking ahead,we will work to further improve customer experience in order to differentiate ourselves in China's travel industry." said Mr. Donald Dunde Yu,Tuniu's founder,Chairman and Chief Executive Officer. "Reflecting our disciplined approach,Tuniu's operating expenses decreased year-on-year for the third consecutive quarter. We will continue to apply our existing cost control measures to further improve operational efficiency."

Third Quarter 2021 Results

Net revenues were RMB114.6 million (US$17.8 million[1]) in the third quarter of 2021,representing a year-over-year decrease of 7.2% from the corresponding period in 2020. The decrease was primarily due to the negative impact brought by the outbreak and spread of COVID-19.

Revenues from packaged tours were RMB90.7 million (US$14.1 million) in the third quarter of 2021,representing a year-over-year increase of 5.0% from the corresponding period in 2020. The increase was primarily due to the growth in revenues from self-operated products.

Other revenues were RMB23.9 million (US$3.7 million) in the third quarter of 2021,representing a year-over-year decrease of 35.6% from the corresponding period in 2020. The decrease was primarily due to the decline in commissions received from other travel-related products impacted by the outbreak and spread of COVID-19.

[1] The conversion of Renminbi ("RMB") into United States dollars ("US$") is based on the exchange rate of US$1.00=RMB 6.4434 on September 30,2021 as set forth in H.10 statistical release of the U.S. Federal Reserve Board and available at https://www.federalreserve.gov/releases/h10/default.htm.

Cost of revenues was RMB74.9 million (US$11.6 million) in the third quarter of 2021,representing a year-over-year increase of 28.1% from the corresponding period in 2020. As a percentage of net revenues,cost of revenues was 65.3% in the third quarter of 2021,compared to 47.3% in the corresponding period in 2020.

Gross profit was RMB39.7 million (US$6.2 million) in the third quarter of 2021,representing a year-over-year decrease of 38.9% from the corresponding period in 2020.

Operating expenses were RMB96.4 million (US$15.0 million) in the third quarter of 2021,representing a year-over-year decrease of 24.6% from the corresponding period in 2020. Share-based compensation expenses and amortization of acquired intangible assets,which were allocated to operating expenses,were RMB5.5 million (US$0.9 million) in the third quarter of 2021. Non-GAAP[2]operating expenses,which excluded share-based compensation expenses and amortization of acquired intangible assets,were RMB90.9 million (US$14.1 million) in the third quarter of 2021,representing a year-over-year decrease of 23.1%.

Research and product development expenses were RMB15.6 million (US$2.4 million) in the third quarter of 2021,representing a year-over-year decrease of 2.7%. Non-GAAP research and product development expenses,which excluded share-based compensation expenses and amortization of acquired intangible assets of RMB1.0 million (US$0.2 million),were RMB14.6 million (US$2.3 million) in the third quarter of 2021,representing a year-over-year decrease of 2.2% from the corresponding period in 2020. The decrease was primarily due to the decrease in amortization of intangible assets.

Sales and marketing expenses were RMB41.7 million (US$6.5 million) in the third quarter of 2021,representing a year-over-year decrease of 16.4%. Non-GAAP sales and marketing expenses,which excluded share-based compensation expenses and amortization of acquired intangible assets of RMB1.4 million (US$0.2 million),were RMB40.3 million (US$6.3 million) in the third quarter of 2021,representing a year-over-year decrease of 7.7% from the corresponding period in 2020. The decrease was primarily due to the decrease in sales and marketing personnel related expenses and amortization of acquired intangible assets.

General and administrative expenses were RMB41.2 million (US$6.4 million) in the third quarter of 2021,representing a year-over-year decrease of 40.9%. Non-GAAP general and administrative expenses,which excluded share-based compensation expenses and amortization of acquired intangible assets of RMB3.1 million (US$0.5 million),were RMB38.1 million (US$5.9 million) in the third quarter of 2021,representing a year-over-year decrease of 43.5% from the corresponding period in 2020. The decrease was primarily due to the decrease in general and administrative personnel related expenses.

[2] The section below entitled "About Non-GAAP Financial Measures" provides information about the use of Non-GAAP financial measures in this press release,and the table captioned "Reconciliations of GAAP and Non-GAAP Results" set forth at the end of this press release reconciles Non-GAAP financial information with the Company's financial results under GAAP.

Loss from operationswas RMB56.6 million (US$8.8 million) in the third quarter of 2021,compared to a loss from operations of RMB62.8 million in the third quarter of 2020. Non-GAAP loss from operations,was RMB50.9 million (US$7.9 million) in the third quarter of 2021.

Net loss was RMB36.6 million (US$5.7 million) in the third quarter of 2021,compared to a net loss of RMB62.1 million in the third quarter of 2020. Non-GAAP net loss,was RMB30.9 million (US$4.8 million) in the third quarter of 2021.

Net loss attributable to ordinary shareholderswas RMB35.1 million (US$5.4 million) in the third quarter of 2021,compared to a net loss attributable to ordinary shareholders of RMB56.9 million in the third quarter of 2020. Non-GAAP net loss attributable to ordinary shareholders,was RMB29.4 million (US$4.6 million) in the third quarter of 2021.

As of September 30,2021,the Company had cash and cash equivalents,restricted cash and short-term investments of RMB1.0 billion (US$157.9 million).The COVID-19 pandemic has negatively impacted our business operations,and will continue to impact our results of operations and cash flows for subsequent periods. Based on our liquidity assessment and management actions,we believe that our available cash,cash equivalents and maturity of investments will be sufficient to meet our working capital requirements and capital expenditures in the ordinary course of business for the next twelve months.

Business Outlook

For the fourth quarter of 2021,the Company expects to generate RMB53.4 million to RMB65.3 million of net revenues,which represents 45% to 55% decrease year-over-year. This forecast reflects Tuniu's current and preliminary view on the industry and its operations,which is subject to change.

Conference Call Information

Tuniu's management will hold an earnings conference call at 8:00 am U.S. Eastern Time,on November 19,(9:00 pm,Beijing/Hong Kong Time,2021) to discuss the third quarter 2021 financial results.

To participate in the conference call,please dial the following numbers:

US:

800-263-0877

Hong Kong:

800-961-105 / +852-3008-1527

Mainland China:

4001-209101

International:

+1 646-828-8143

Conference ID:

Tuniu 3Q 2021 Earnings Call

A telephone replay will be available from 11:00 am on November 19,2021 through 11:00 am on November 26,U.S. Eastern Time. The dial-in details are as follows:

US:

1-888-203-1112

Hong Kong:

+852-5808-3200

Mainland China:

4001-201651

International:

+1-719-457-0820

Replay Access Code:

4308160

Additionally,a live and archived webcast of the conference call will also be available on the Company's investor relations website at http://ir.tuniu.com.

AboutTuniu

Tuniu (Nasdaq:TOUR) is a leading online leisure travel company in China that offers a large selection of packaged tours,including organized and self-guided tours,as well as travel-related services for leisure travelers through its website tuniu.com and mobile platform. Tuniu coversover 420 departing cities throughout China and all popular destinations worldwide. Tuniu provides one-stop leisure travel solutions and a compelling customer experience through its online platform and offline service network,including a dedicated team of professional customer service representatives,24/7 call centers,extensive networks of offline retail stores and self-operated local tour operators. For more information,please visit http://ir.tuniu.com.

Safe Harbor Statement

This press release contains forward-looking statements made under the "safe harbor" provisions of Section 21E of the Securities Exchange Act of 1934,as amended,and 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," "confident" and similar statements. Tuniu may also make written or oral forward-looking statements in its reports filed with or furnished to the U.S. Securities and Exchange Commission,in its annual report to shareholders,in press releases and other written materials and in oral statements made by its officers,directors or employees to third parties. Any statements that are not historical facts,including statements about Tuniu's beliefs and expectations,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,but are not limited to the following: Tuniu's goals and strategies; the growth of the online leisure travel market in China; the demand for Tuniu's products and services; its relationships with customers and travel suppliers; the Company's ability to offer competitive travel products and services; Tuniu's future business development,results of operations and financial condition; competition in the online travel industry in China; relevant government policies and regulations relating to the Company's structure,business and industry; the impact of the COVID-19 on Tuniu's business operations,the travel industry and the economy of China and elsewhere generally; and the general economic and business condition in China and elsewhere. Further information regarding these and other risks,uncertainties or factors is included in the Company's filings with the U.S. Securities and Exchange Commission. All information provided in this press release is current as of the date of the press release,and Tuniu does not undertake any obligation to update such information,except as required under applicable law.

About Non-GAAP Financial Measures

To supplement the Company's unaudited consolidated financial results presented in accordance with United States Generally Accepted Accounting Principles ("GAAP"),the Company has provided non-GAAP information related to cost of revenues,research and product development expenses,sales and marketing expenses,general and administrative expenses,other operating income,total operating expenses,loss from operations,net loss,net loss attributable to ordinary shareholders,net loss per ordinary share attributable to ordinary shareholders-basic and diluted and net loss per ADS-basic and diluted,which excludes share-based compensation expenses,amortization of acquired intangible assets and impairment of acquired intangible assets. We believe that the non-GAAP financial measures used in this press release are useful for understanding and assessing underlying business performance and operating trends,and management and investors benefit from referring to these non-GAAP financial measures in assessing our financial performance and when planning and forecasting future periods. 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.

A limitation of using non-GAAP financial measures excluding share-based compensation expenses,amortization of acquired intangible assets and impairment of acquired intangible assets is that share-based compensation expenses,amortization of acquired intangible assets and impairment of acquired intangible assets have been – and will continue to be – significant recurring expenses in the Company's business. You should not view non-GAAP results on a stand-alone basis or as a substitute for results under GAAP,or as being comparable to results reported or forecasted by other companies.

(Financial Tables Follow)

Tuniu Corporation

Unaudited Condensed Consolidated Balance Sheets

(All amounts in thousands,except per share information)

December 31,2020

September 30,2021

RMB

US$

ASSETS

Current assets

Cash and cash equivalents

213,538

356,776

55,371

Restricted cash

50,566

26,246

4,073

Short-term investments

1,353,670

634,652

98,496

Accounts receivable,net

264,134

227,422

35,295

Amounts due from related parties

23,913

22,892

3,553

Prepayments and other current assets

378,704

417,166

64,743

Total current assets

2,284,525

1,685,154

261,531

Non-current assets

Long-term investments

266,866

202,727

31,463

Property and equipment,net

111,697

105,841

16,426

Intangible assets,net

71,362

59,080

9,169

Land use right,net

96,713

95,167

14,770

Operating lease right-of-use assets,net

42,293

58,585

9,092

Goodwill

232,007

36,007

Other non-current assets

91,180

95,969

14,894

Total non-current assets

912,118

849,376

131,821

Total assets

3,196,643

2,534,530

393,352

LIABILITIES,REDEEMABLE NONCONTROLLING INTERESTS AND EQUITY

Current liabilities

Short-term borrowings

60,679

10,604

1,646

Accounts and notes payable

705,838

530,032

82,260

Amounts due to related parties

21,034

5,034

781

Salary and welfare payable

47,487

41,415

6,428

Taxes payable

6,004

3,945

612

Advances from customers

208,762

181,961

28,240

Operating lease liabilities,current

18,264

18,176

2,821

Accrued expenses and other current liabilities

676,501

373,052

57,895

Total current liabilities

1,744,569

1,164,219

180,683

Non-current liabilities

Operating lease liabilities,non-current

34,367

45,157

7,008

Deferred tax liabilities

14,861

13,032

2,023

Long-term borrowings

22,577

15,664

2,431

Other non-current liabilities

3,054

474

Total non-current liabilities

74,859

76,907

11,936

Total liabilities

1,819,428

1,241,126

192,619

Redeemable noncontrolling interests

27,200

4,221

Equity

Ordinary shares

249

Less: Treasury stock

(302,916)

(295,307)

(45,831)

Additional paid-in capital

9,125,689

9,126,145

1,416,355

Accumulated other comprehensive income

275,012

275,955

42,828

Accumulated deficit

(7,713,355)

(7,800,983)

(1,210,694)

Total Tuniu Corporation shareholders' equity

1,384,679

1,306,059

202,697

Noncontrolling interests

(34,664)

(39,855)

(6,185)

Total equity

1,350,015

1,266,204

196,512

Total liabilities,redeemable noncontrolling interests and equity

3,352

Tuniu Corporation

Unaudited Condensed Consolidated Statements of Comprehensive Loss

(All amounts in thousands,except per share information)

QuarterEnded

September 30,2020

June 30,2021

RMB

US$

Revenues

Packaged tours

86,413

126,502

90,709

14,078

Others

37,132

34,459

23,915

3,712

Net revenues

123,545

160,961

114,624

17,790

Cost of revenues

(58,472)

(91,975)

(74,884)

(11,622)

Gross profit

65,073

68,986

39,740

6,168

Operating expenses

Research and product development

(16,008)

(13,757)

(15,580)

(2,418)

Sales and marketing

(49,869)

(44,795)

(41,668)

(6,467)

General and administrative

(69,769)

(41,541)

(41,224)

(6,398)

Other operating income

7,803

4,950

2,106

327

Total operating expenses

(127,843)

(95,143)

(96,366)

(14,956)

Loss from operations

(62,770)

(26,157)

(56,626)

(8,788)

Other (expenses)/income

Interest and investment income

(7,389)

9,095

19,492

3,025

Interest expense

(6,483)

(1,944)

(1,097)

(170)

Foreign exchange gains/(losses),net

12,779

4,289

(463)

(72)

Other income,net

1,056

664

686

106

Loss before income tax expense

(62,807)

(14,053)

(38,008)

(5,899)

Income tax benefit

1,037

134

568

Equity in income of affiliates

(286)

(95)

861

134

Net loss

(62,056)

(14,014)

(36,579)

(5,677)

Net loss attributable to noncontrolling interests

(5,152)

(949)

(1,497)

(232)

Net income attributable to redeemable noncontrolling interests

Net loss attributable to Tuniu Corporation

(56,904)

(13,065)

(35,082)

(5,445)

Reversal of redeemable noncontrolling interests

Net loss attributable to ordinary shareholders

(56,445)

Net loss

(62,677)

Other comprehensive (loss)/income:

Foreign currency translation adjustment,net of nil tax

(11,993)

(4,389)

1,685

262

Comprehensive loss

(74,049)

(18,403)

(34,894)

(5,415)

Net loss per ordinary share attributable to ordinary shareholders -

basic and diluted

(0.15)

(0.04)

(0.09)

(0.01)

Net loss per ADS - basic and diluted*

(0.45)

(0.12)

(0.27)

(0.03)

Weighted average number of ordinary shares used in computing

basic and diluted loss per share

370,298,762

370,929,055

370,956,994

370,994

Share-based compensation expenses included are as follows:

Cost of revenues

214

Research and product development

287

359

Sales and marketing

132

332

General and administrative

1,626

2,928

2,475

384

Total

2,142

3,109

3,380

525

*Each ADS represents three of the Company's ordinary shares.

Reconciliations of GAAP and Non-GAAP Results

(All amounts in thousands,except per share information)

Quarter Ended September 30,2021

GAAP Result

Share-based

Amortization of acquired

Non-GAAP

Compensation

intangible assets

Result

Cost of revenues

(74,884)

214

(74,670)

Research and product development

(15,580)

359

616

(14,605)

Sales and marketing

(41,668)

332

1,065

(40,271)

General and administrative

(41,224)

2,475

652

(38,097)

Other operating income

2,106

Total operating expenses

(96,366)

3,166

2,333

(90,867)

Loss from operations

(56,626)

3,380

2,333

(50,913)

Net loss

(36,579)

3,333

(30,866)

Net loss attributable to ordinary shareholders

(35,082)

3,333

(29,369)

Net loss per ordinary share attributable to ordinary

shareholders - basic and diluted

(0.09)

(0.08)

Net loss per ADS - basic and diluted

(0.27)

(0.24)

Weighted average number of ordinary shares used in

computing basic and diluted loss per share

370,994

Quarter Ended June 30,2021

GAAP Result

Share-based

Amortization of acquired

Non-GAAP

Compensation

intangible assets

Result

Cost of revenues

(91,975)

(91,931)

Research and product development

(13,757)

782

(12,899)

Sales and marketing

(44,795)

1,065

(43,669)

General and administrative

(41,541)

2,928

681

(37,932)

Other operating income

4,950

Total operating expenses

(95,143)

3,065

2,528

(89,550)

Loss from operations

(26,157)

3,109

2,528

(20,520)

Net loss

(14,014)

3,528

(8,377)

Net loss attributable to ordinary shareholders

(13,065)

3,528

(7,428)

Net loss per ordinary share attributable to ordinary

shareholders - basic and diluted

(0.04)

(0.02)

Net loss per ADS - basic and diluted

(0.12)

(0.06)

Weighted average number of ordinary shares used in

computing basic and diluted loss per share

370,055

Quarter Ended September 30,2020

GAAP Result

Share-based

Amortization of acquired

Non-GAAP

Compensation

intangible assets

Result

Cost of revenues

(58,472)

(58,375)

Research and product development

(16,008)

287

782

(14,939)

Sales and marketing

(49,869)

132

6,105

(43,632)

General and administrative

(69,769)

1,626

709

(67,434)

Other operating income

7,803

Total operating expenses

(127,843)

2,045

7,596

(118,202)

Loss from operations

(62,770)

2,142

7,596

(53,032)

Net loss

(62,056)

2,596

(52,318)

Net loss attributable to ordinary shareholders

(56,904)

2,596

(47,166)

Net loss per ordinary share attributable to ordinary

shareholders - basic and diluted

(0.15)

(0.13)

Net loss per ADS - basic and diluted

(0.45)

(0.39)

Weighted average number of ordinary shares used in

computing basic and diluted loss per share

370,762

*Basic net loss per ordinary share attributable to ordinary shareholders is calculated by dividing net loss attributable to ordinary shareholders by the

weighted average number of ordinary shares outstanding during the periods. Diluted net loss per ordinary share attributable to ordinary shareholders

is calculated by dividing net loss attributable to ordinary shareholders by the weighted average number of ordinary shares and dilutive potential

ordinary shares outstanding during the periods,including the dilutive effect of share-based awards as determined under the treasury stock method.