HOMEINNS HOTEL GROUP SHANGHAI, March 16, 2016 /PRNewswire/ -- Homeinns Hotel Group (NASDAQ: HMIN) ("Homeinns" 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, 2015.
Fourth Quarter and Full Year 2015 Highlights
-- Total revenues increased 2.6% year over year to RMB 1,677.4 million
(US$258.9 million) for the fourth quarter of 2015. For the full year
2015, total revenues decreased 0.2% year over year to RMB 6,671.1
million (US$1,029.8 million).
-- Net loss attributable to ordinary shareholders was RMB 13.1 million
(US$2.0 million) for the fourth quarter of 2015, compared with net
income attributable to ordinary shareholders of RMB 84.6 million for the
fourth quarter of 2014. For the full year 2015, net income attributable
to ordinary shareholders was RMB 167.0 million (US$25.8 million),
compared with net income attributable to ordinary shareholders of RMB
513.1 million for the full year 2014.
-- Adjusted net income attributable to ordinary shareholders (non-GAAP)
decreased 44.6% year over year to RMB 61.5 million (US$9.5 million) for
the fourth quarter of 2015. For the full year 2015, adjusted net income
attributable to ordinary shareholders (non-GAAP) decreased 30.2% year
over year to RMB 373.9 million (US$57.7 million).
-- EBITDA (non-GAAP) decreased 28.3% year over year to RMB 239.7 million
(US$37.0 million) for the fourth quarter of 2015. For the full year
2015, EBITDA (non-GAAP) decreased 24.7% year over year to RMB 1,168.8
million (US$180.4 million).
-- Adjusted EBITDA (non-GAAP) decreased 12.9% year over year to RMB 314.2
million (US$48.5 million) for the fourth quarter of 2015. For the full
year 2015, adjusted EBITDA (non-GAAP) decreased 12.7% year over year to
RMB 1,375.7 million (US$212.4 million).
-- Net operating cash inflow decreased 37.9% year over year to RMB 216.2
million (US$33.4 million) for the fourth quarter of 2015 and decreased
16.2% year over year to RMB 1,127.8 million (US$174.1 million) for the
full year 2015.
-- As of December 31, 2015, Homeinns operated 2,922 hotels in 355 cities
across China, with a net addition of 135 hotels during the fourth
quarter and 313 hotels during the full year 2015.
Hotel Development
Hotels in Operations and Pipeline
---------------------------------
Group Homeinn Motel Fairy-land Yitel Homeinn Plus Superior* Ripple* Pebble Motel* Comma**
----- ------- ----- ---------- ----- ------------ -------- ------ ------------ ------
Total Number of Hotels 2,922 2,341 422 29 68 53 1 2 4 2
Leased-and-Operated 929 680 162 21 29 35 0 0 0 2
Franchised-and-Managed 1,987 1,661 260 8 39 18 0 1 0 0
Franchised 6 0 0 0 0 0 1 1 4 0
Contracted or under Construction 171 95 22 2 21 20 0 0 0 11
Leased-and-Operated 33 4 2 0 8 8 0 0 0 11
Franchised-and-Managed 138 91 20 2 13 12 0 0 0 0
Under Due Diligence 165 129 10 0 10 9 0 1 3 3
* Superior, Ripple and Pebble Motel are new hotel brands launched during the fourth quarter of 2015.
**Comma is an apartment product launched during the fourth quarter of 2015.
Openings Closures*
-------- --------
4Q2015 FY2015 4Q2015 FY2015
------ ------ ------ ------
Total Number of Hotels 170 431 35 118
Leased-and-Operated 32 62 20 47
Franchised-and-Managed 132 363 15 71
Franchised 6 6 0 0
* Among these closures, 11 leased-and-operated hotels were closed due to conversion to our other brands, and one leased-and-
operated hotel was closed and converted to a franchised-and-managed hotel during the fourth quarter of 2015. 26 leased-and-
operated hotels were closed to convert to our other brands, and 3 leased-and-operated hotels were closed and converted to
franchised-and-managed hotels during the full year 2015.
Operating Metrics
Total Hotels
4Q2015 3Q2015 4Q2014 FY2015 FY2014
------ ------ ------ ------ ------
Occupancy Rate 83.1% 86.6% 79.6% 83.2% 83.6%
Average Daily Rate (ADR, RMB) 159 171 163 162 165
Revenue per Available Room (RevPAR, RMB) 132 148 130 134 138
Hotels Opened for at least 18 Months
4Q2015 4Q2014 FY2015 FY2014
------ ------ ------ ------
Occupancy Rate 84.0% 81.3% 84.5% 85.3%
Average Daily Rate (ADR, RMB) 157 161 161 165
Revenue per Available Room (RevPAR, RMB) 132 131 136 141
For the fourth quarter of 2015, occupancy rate increased by 3.5 percentage points while ADR decreased by 2.5% compared with the fourth quarter of 2014, resulting in an increase of 1.5% in RevPAR. For the full year 2015, occupancy rate decreased by 0.4 percentage points while ADR decreased by 1.8% compared with the full year 2014, resulting in a decrease of 2.9% in RevPAR.
As of December 31, 2015, a total of 2,257 hotels had been in operation for at least 18 months. During the fourth quarter of 2015, occupancy rate of these hotels increased year over year from 81.3% to 84.0%, and ADR decreased year over year from RMB 161 to RMB 157, resulting in an increase in RevPAR by 0.8% from RMB 131 to RMB 132. For the full year 2015, occupancy rate of these hotels decreased year over year from 85.3% to 84.5%, and ADR decreased year over year from RMB 165 to RMB 161, resulting in a decrease in RevPAR by 3.5% from RMB 141 to RMB 136.
Homeinns Hotel Group had a total of 53.9 million unique non-corporate members under its frequent guests program as of December 31, 2015.
Financial Results for Fourth Quarter and Full Year 2015
Revenues
(RMB/USD in Millions) 4Q2015 4Q2014 FY2015 FY2014
--------------------- ------ ------ ------ ------
RMB USD RMB V% RMB USD RMB V%
--- --- --- --- --- --- --- ---
Leased-and-Operated Hotels 1,402.3 216.5 1,391.1 0.8% 5,631.2 869.3 5,741.8 -1.9%
Franchised-and-Managed Hotels 275.2 42.5 244.2 12.7% 1,039.9 160.5 940.9 10.5%
----- ---- ----- ----- ----- -----
Total Revenues 1,677.4 258.9 1,635.3 2.6% 6,671.1 1,029.8 6,682.7 -0.2%
Less: Business Taxes -99.7 -15.4 -100.3 -0.6% -395.4 -61.0 -411.1 -3.8%
----- ----- ------ ---- ------ ----- ------ ----
Net Revenues 1,577.7 243.6 1,535.0 2.8% 6,275.7 968.8 6,271.6 0.1%
======= ===== ======= === ======= ===== ======= ===
Note: "V%" represents year-over-year percentage change in amounts
For the fourth quarter of 2015, revenues from leased-and-operated hotels increased 0.8% year over year to RMB 1.40 billion (US$216.5 million). The year-over-year increase in revenues from leased-and-operated hotels in the fourth quarter of 2015 was mainly due to an increase in RevPAR. Revenues from franchised-and-managed hotels increased 12.7% year over year to RMB 275.2 million (US$42.5 million) for the fourth quarter of 2015. The year-over-year increase in revenues from franchised-and-managed hotels in the fourth quarter of 2015 was mainly driven by an increase in the number of hotels and hotel rooms in operation.
For the full year 2015, revenues from leased-and-operated hotels decreased 1.9% year over year to RMB 5.63 billion (US$869.3 million). The year-over-year decrease in revenues from leased-and-operated hotels in the full year 2015 was mainly due to a decrease in RevPAR. Revenues from franchised-and-managed hotels increased 10.5% year over year to RMB 1.04 billion (US$160.5 million) for the full year of 2015. The year-over-year increase in revenues from franchised-and-managed hotels was mainly driven by an increase in the number of hotels and hotel rooms in operation, although partially offset by a decrease in RevPAR.
Total Operating Costs and Expenses / Income from Operations
(RMB/USD in Millions) Fourth Quarter 2015
Adjusted
GAAP Results Non-GAAP Results*
RMB USD Vpts RMB USD Vpts
--- --- ---- --- --- ----
Leased-and-Operated Hotel Costs 1,352.7 208.8 1.2pts 1,349.6 208.3 1.3pts
Personnel Costs of Franchised-and-Managed Hotels 35.7 5.5 0.0pts 31.8 4.9 0.0pts
Sales and Marketing Expenses 41.3 6.4 1.1pts 41.2 6.4 1.1pts
General and Administrative Expenses 122.7 18.9 2.6pts 68.5 10.6 0.3pts
----- ---- ------ ---- ---- ------
Total Operating Costs and Expenses 1,552.3 239.6 4.9pts 1,491.1 230.2 2.7pts
Income from Operations 19.9 3.1 -5.1pts 81.0 12.5 -2.8pts
==== === ======= ==== ==== =======
Full Year 2015
Adjusted
GAAP Results Non-GAAP Results*
RMB USD Vpts RMB USD Vpts
--- --- ---- --- --- ----
Leased-and-Operated Hotel Costs 5,211.7 804.5 3.0pts 5,199.9 802.7 3.0pts
Personnel Costs of Franchised-and-Managed Hotels 228.2 35.2 0.4pts 214.8 33.2 0.4pts
Sales and Marketing Expenses 115.1 17.8 0.1pts 114.4 17.7 0.1pts
General and Administrative Expenses 362.0 55.9 0.8pts 258.3 39.9 0.2pts
----- ---- ------ ----- ---- ------
Total Operating Costs and Expenses 5,917.0 913.4 4.2pts 5,787.5 893.4 3.7pts
Income from Operations 350.7 54.1 -4.3pts 480.3 74.1 -3.8pts
===== ==== ======= ===== ==== =======
*Adjusted Non-GAAP results exclude share-based compensation expenses, integration costs, and expenses related to going-private activities.
Note: "Vpts" represents year-over-year change in percentage points of total revenues
For the fourth quarter of 2015, total operating costs and expenses were RMB 1.55 billion (US$239.6 million), representing 92.5% of total revenues. Total operating costs and expenses excluding any share-based compensation expenses, integration costs and expenses related to going-private activities (non-GAAP) for the fourth quarter of 2015 were 88.9% of total revenues, compared to 86.2% in the same period a year ago.
For the full year 2015, total operating costs and expenses were RMB 5.92 billion (US$913.4 million), representing 88.7% of total revenues. Total operating costs and expenses excluding any share-based compensation expenses, integration costs and expenses related to going-private activities (non-GAAP) for the full year 2015 were 86.8% of total revenues, compared to 83.1% in the same period a year ago.
-- Total leased-and-operated hotel costs were RMB 1.35 billion (US$208.8
million) for the fourth quarter of 2015, representing 96.5% of the
leased-and-operated hotel revenues, compared to 93.3% in the same period
a year ago. Total leased-and-operated hotel costs excluding any
share-based compensation expenses and integration costs (non-GAAP) were
96.2% of the leased-and-operated hotel revenues in the fourth quarter of
2015, compared to 93.1% in the same period a year ago. The
year-over-year increase in total leased-and-operated hotel costs as a
percentage of leased-and-operated hotel revenues for the fourth quarter
of 2015 was mainly due to the higher rental and depreciation cost from
our having a higher proportion of midscale hotels and to the higher
depreciation cost from economy hotel upgrading.Total leased-and-operated
hotel costs were RMB 5.21 billion (US$804.5 million) for the full year
2015, representing 92.5% of the leased-and-operated hotel revenues,
compared to 87.5% in 2014. Total leased-and-operated hotel costs
excluding any share-based compensation expenses and integration costs
(non-GAAP) were 92.3% of the leased-and-operated hotel revenues in the
full year 2015, compared to 87.2% in 2014. The year-over-year increase
in total leased-and-operated hotel costs as a percentage of
leased-and-operated hotel revenues for the full year 2015 was mainly due
to increased rental and depreciation costs and a decrease in RevPAR
which resulted in a lower revenue base per hotel while a significant
portion of the hotel costs was fixed. Pre-opening cost was RMB 22.5
million (US$3.5 million) for the fourth quarter of 2015, compared to RMB
18.5 million in the fourth quarter of 2014. For the full year 2015,
pre-opening cost was RMB 77.4 million (US$11.9 million), compared to RMB
44.6 million in 2014.
-- Personnel costs of franchised-and-managed hotels were RMB 35.7 million
(US$5.5 million) for the fourth quarter of 2015, representing 13.0% of
the franchised-and-managed hotel revenues, compared to 14.0% in the same
period a year ago. Franchised-and-managed hotels personnel costs
excluding share-based compensation expenses (non-GAAP) were 11.6% of
franchised-and-managed hotel revenues in the fourth quarter of 2015,
compared to 12.6% in the same period of 2014. The year-over-year
decrease in personnel costs of franchised-and-managed hotels as a
percentage of franchised-and-managed hotel revenues for the fourth
quarter of 2015 was mainly due to the lower year-end bonuses.Personnel
costs of franchised-and-managed hotels were RMB 228.2 million (US$35.2
million) for the full year 2015, representing 21.9% of the
franchised-and-managed hotel revenues, compared to 21.4% in 2014.
Franchised-and-managed hotels personnel costs excluding share-based
compensation expenses (non-GAAP) were 20.7% of franchised-and-managed
hotel revenues in the full year 2015, compared to 20.0% in 2014. The
year-over-year increase in personnel costs of franchised-and-managed
hotels as a percentage of franchised-and-managed hotel revenues for the
full year 2015 was mainly due to a lower revenue base per hotel.
-- Sales and marketing expenses were RMB 41.3 million (US$6.4 million) for
the fourth quarter of 2015, representing 2.5% of total revenues,
compared to 1.4% in the same period a year ago. Sales and marketing
expenses excluding share-based compensation expenses (non-GAAP) were
2.5% of total revenues for the fourth quarter of 2015, compared to 1.4%
in the same period of 2014. The year-over-year increase in sales and
marketing expenses as a percentage of total revenues for the fourth
quarter of 2015 was mainly due to the increased cost related to
membership loyalty program.Sales and marketing expenses were RMB 115.1
million (US$17.8 million) for the full year 2015, representing 1.7% of
total revenues, compared to 1.6% in 2014. Sales and marketing expenses
excluding share-based compensation expenses (non-GAAP) were 1.7% of
total revenues for the full year 2015, compared to 1.6% in 2014.
-- General and administrative expenses were RMB 122.7 million (US$18.9
million) for the fourth quarter of 2015, representing 7.3% of total
revenues, compared to 4.7% in the same period a year ago. General and
administrative expenses excluding share-based compensation expenses,
integration costs, and expenses related to going-private activities
(non-GAAP) were 4.1% of total revenues for the fourth quarter of 2015,
compared to 3.7% in the same period of 2014. The year-over-year increase
in general and administrative expenses as a percentage of total revenues
for the fourth quarter of 2015 was mainly due to increased staff cost
for new product development.General and administrative expenses were RMB
362.0 million (US$55.9 million) for the full year 2015, representing
5.4% of total revenues, compared to 4.7% in 2014. General and
administrative expenses excluding share-based compensation expenses,
integration costs, acquisition expenses, and expenses related to
going-private activities (non-GAAP) were 3.9% of total revenues for the
full year 2015, compared to 3.7% in 2014. The year-over-year increase in
general and administrative expenses as a percentage of total revenues
for the full year 2015 was mainly due to a bad debt provision related to
a specific hotel project.
Income from Operations was RMB 19.9 million (US$3.1 million) for the fourth quarter of 2015 compared to RMB 102.5 million in the same period a year ago. Income from operations excluding share-based compensation expenses, integration costs and expenses related to going-private activities (non-GAAP) for the fourth quarter of 2015 was RMB 81.0 million (US$12.5 million), or 4.8% of total revenues, compared to RMB 125.6 million, or 7.7% of total revenues, in the same period of 2014.
For the full year of 2015, income from operations was RMB 350.7 million (US$54.1 million) compared to RMB 640.6 million in 2014. Income from operations excluding share-based compensation expenses, integration costs and expenses related to going-private activities (non-GAAP) for the full year 2015 was RMB 480.3 million (US$74.1 million), or 7.2% of total revenues, compared to RMB 736.3 million, or 11.0% of total revenues, in 2014.
EBITDA (non-GAAP)
(RMB/USD in Millions) Fourth Quarter 2015 Fourth Quarter 2014
------------------- -------------------
RMB USD %Rev V% RMB USD %Rev
--- --- ---- --- --- --- ----
EBITDA (Non-GAAP) 239.7 37.0 14.3% -28.3% 334.3 51.6 20.4%
Foreign Exchange Loss/(Gain), Net 5.9 0.9 0.4% -4.6 -0.7 -0.3%
Share-Based Compensation 17.7 2.7 1.1% 21.3 3.3 1.3%
Expenses Related to Going-Private
Activities 41.9 6.5 2.5% - - -
Integration Costs 1.6 0.3 0.1% 1.8 0.3 0.1%
Loss on Change in Fair Value of
Convertible Notes 7.5 1.2 0.4% 7.9 1.2 0.5%
--- --- --- --- ---
Adjusted EBITDA (Non-GAAP) 314.2 48.5 18.7% -12.9% 360.7 55.7 22.1%
===== ==== ==== ===== ===== ==== ====
Full Year 2015 Full Year 2014
-------------- --------------
RMB USD %Rev V% RMB USD %Rev
--- --- ---- --- --- --- ----
EBITDA (Non-GAAP) 1,168.8 180.4 17.5% -24.7% 1,553.1 239.8 23.2%
Foreign Exchange Loss, Net 41.0 6.3 0.6% 11.5 1.8 0.2%
Share-Based Compensation 76.4 11.8 1.1% 87.7 13.5 1.3%
Acquisition Expenses - - - 0.7 0.1 0.0%
Expenses Related to Going-Private Activities 46.7 7.2 0.7% - - -
Integration Costs 6.4 1.0 0.1% 7.3 1.1 0.1%
Gain on Waived Liability Related with Motel Acquisition - - - -11.9 -1.8 -0.2%
Loss/(Gain) on Buy-Back of Convertible Notes 1.7 0.3 0.0% -0.7 -0.1 0.0%
Loss/(Gain) on Change in Fair Value of Convertible Notes 34.6 5.3 0.5% -71.9 -11.1 -1.1%
---------- ---- --- ----- -----
Adjusted EBITDA (Non-GAAP) 1,375.7 212.4 20.6% -12.7% 1,575.7 243.3 23.6%
======= ===== ==== ===== ======= ===== ====
Note: "%Rev" represents amount as a percentage of total revenues
"V%" represents year-over-year percentage change in amounts
Net Income Attributable to Ordinary Shareholders
(RMB/USD in Millions) Fourth Quarter 2015 Fourth Quarter 2014
------------------- -------------------
RMB USD %Rev V% RMB USD %Rev
--- --- ---- --- --- --- ----
Net Income Attributable to Ordinary Shareholders (GAAP) -13.1 -2.0 -0.8% -115.4% 84.6 13.1 5.2%
Foreign Exchange Loss/(Gain), Net 5.9 0.9 0.4% -4.6 -0.7 -0.3%
Share-Based Compensation 17.7 2.7 1.1% 21.3 3.3 1.3%
Expenses Related to Going-Private Activities 41.9 6.5 2.5% - - -
Integration Costs 1.6 0.3 0.1% 1.8 0.3 0.1%
Loss/(Gain) on Change in Fair Value of Convertible Notes 7.5 1.2 0.4% 7.9 1.2 0.5%
--- --- --- --- ---
Adjusted net income attributable to ordinary shareholders (Non-GAAP) 61.5 9.5 3.7% -44.6% 110.9 17.1 6.8%
==== === === ===== ===== ==== ===
Full Year 2015 Full Year 2014
-------------- --------------
RMB USD %Rev V% RMB USD %Rev
--- --- ---- --- --- --- ----
Net Income Attributable to Ordinary Shareholders (GAAP) 167.0 25.8 2.5% -67.4% 513.1 79.2 7.7%
Foreign Exchange Loss, Net 41.0 6.3 0.6% 11.5 1.8 0.2%
Share-Based Compensation 76.4 11.8 1.1% 87.7 13.5 1.3%
Acquisition Expenses - - - 0.7 0.1 0.0%
Expenses Related to Going-Private Activities 46.7 7.2 0.7% - - -
Integration Costs 6.4 1.0 0.1% 7.3 1.1 0.1%
Gain on Waived Liability Related with Motel
Acquisition - - - -11.9 -1.8 -0.2%
Loss/(Gain) on Buy-Back of Convertible Notes 1.7 0.3 0.0% -0.7 -0.1 0.0%
Loss/(Gain) on Change in Fair Value of Convertible
Notes 34.6 5.3 0.5% -71.9 -11.1 -1.1%
-------- ---- --- ----- -----
Adjusted net income attributable to ordinary shareholders (Non-GAAP) 373.9 57.7 5.6% -30.2% 535.8 82.7 8.0%
===== ==== === ===== ===== ==== ===
Note: "%Rev" represents amount as a percentage of total revenues
"V%" represents year-over-year percentage change in amounts
Income Attributable to Ordinary Shareholders (Non-GAAP) decreased year over year by 44.6% to RMB 61.5 million (US$9.5 million) for the fourth quarter 2015, representing 3.7% of total revenues compared to 6.8% in the same period a year ago. For the full year 2015, adjusted net income attributable to ordinary shareholders (Non-GAAP) decreased year over year by 30.2% to RMB 373.9 million (US$57.7 million), representing 5.6% of total revenues compared to 8.0% in 2014. The year-over-year decreases in adjusted net margins (non-GAAP)[1] for both the quarter and full year were mainly due to the decreases in adjusted income from operations margin (non-GAAP)[2].
[1]"Adjusted net margin rate (non-
GAAP)" is defined as adjusted net
income (non-GAAP) as a
percentage of total revenues.
[2]"Adjusted income from
operations margin rate (non-
GAAP)" is defined as income from
operations excluding share-based
compensation expenses,
integration costs, acquisition
expenses, and expenses related to
going-private activities (non-
GAAP) as a percentage of total
revenues.
Basic and Diluted Earnings Per Share / Earnings Per ADS
Fourth Quarter 2015 Full Year 2015 _
------------------- -----------------------------
Ordinary Share ADS Share Ordinary Share ADS Share
RMB USD RMB USD RMB USD RMB USD
--- --- --- --- --- --- --- ---
Basic -0.14 -0.02 -0.28 -0.04 1.74 0.27 3.48 0.54
Diluted -0.14 -0.02 -0.28 -0.04 1.74 0.27 3.48 0.54
Adjusted Basic (Non-GAAP) 0.64 0.10 1.28 0.20 3.89 0.60 7.78 1.20
Adjusted Diluted (Non-GAAP) 0.64 0.10 1.28 0.20 3.83 0.59 7.66 1.18
Cash Flow
For the fourth quarter of 2015, net operating cash inflow was RMB 216.2 million (US$33.4 million), compared to RMB 348.1 million in the same period of 2014. Capitalized expenditures for the fourth quarter of 2015 were RMB 284.5 million (US$43.9 million), while related cash paid for capital expenditures during the quarter was RMB 151.8 million (US$23.4 million).
For the full year 2015, net operating cash inflow was RMB 1.13 billion (US$174.1 million), compared to RMB 1.35 billion in 2014. Capitalized expenditures for the full year 2015 were RMB 727.4 million (US$112.3 million), while related cash paid for capital expenditures during the year was RMB 619.4 million (US$95.6 million).
Balance Sheet
As of December 31, 2015, Homeinns Hotel Group had cash and cash equivalents of RMB 1,093.7 million (US$168.8 million). The convertible notes issued in December 2010 were fully repaid in December 2015.
Upcoming HMIN Extraordinary General Meeting
The Company has scheduled an extraordinary general meeting to be held on March 25, 2016, at 10:00 a.m. Shanghai time, at the executive offices of the Company, located at 124 Cao Bao Road, Shanghai, 200235, People's Republic of China. The extraordinary general meeting is being convened to consider and vote on, among other matters, the proposal to authorize and approve the previously announced agreement and plan of merger dated as of December 6, 2015, among (i) the Company, (ii) BTG Hotels Group (HONGKONG) Holdings Co., Limited ("Holdco"), a wholly owned subsidiary of BTG Hotels (Group) Co., Ltd., a PRC joint stock company that is listed on the Shanghai Stock Exchange ("BTG Hotels"), (iii) BTG Hotels Group (CAYMAN) Holding Co., Ltd ("Merger Sub"), a wholly owned subsidiary of Holdco, and (iv) solely for the purposes of certain sections thereof, BTG Hotels. Subject to the approval of the extraordinary general meeting, Merger Sub will be merged with and into the Company pursuant to the agreement and plan of merger, with the Company continuing as the surviving company. A related transaction statement on Schedule 13E-3 and a proxy statement with respect thereto were filed with the SEC on February 23, 2016. Investors, shareholders and ADS holders of the Company are urged to read carefully and in their entirety these and other materials filed with or furnished to the SEC when they become available, as they contain important information about the Company, the proposed merger and related matters. The proxy statement was mailed to the Company's ADS holders on or about February 26, 2016 and to the Company's shareholders on or about March 4, 2016. The Special Committee of the Board comprised of independent directors reviewed the transaction and recommends that stockholders approve the transaction.
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 6.4778 to US$1.00, the noon buying rate for December 31, 2015 set forth in the H.10 statistical release of the Federal Reserve Board.
About Homeinns Hotel Group
Homeinns Hotel Group is a leading economy hotel chain in China based on number of hotels and hotel rooms as well as geographic coverage of the hotel chain. Since the Company commenced operations in 2002, it has built Homeinn as one of the best-known economy hotel brands in China. In October of 2011, the Company acquired Motel 168, another well-known hotel chain in China, as its second economy hotel brand. Homeinns Hotel 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. Homeinns Hotel 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 Homeinns Hotel 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 brands; trends and competition in the lodging industry; the expected growth of the lodging market in China; 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 Homeinns Hotel Group's unaudited consolidated financial results presented in accordance with U.S. GAAP, Homeinns Hotel Group uses the following non-GAAP measures:
(a) total operating costs and expenses excluding share-based compensation expenses and acquisition and integration costs and expenses related to going-private activities
(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 and expenses related to going-private activities
(f) income from operations excluding share-based compensation expenses and acquisition and integration costs and expenses related to going-private activities
(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 and other non-operating expenses and expenses related to going-private activities
(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, non-operating expenses and upfront fee amortization of term loan, and expenses related to going-private activities
(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 and expenses related to going-private activities
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.
Homeinns Hotel Group believes that, used in conjunction with GAAP financial measures, these non-GAAP financial measures provide meaningful supplemental information regarding the Company's performance, and both management and investors benefit from referring to these non-GAAP financial measures in assessing the Company'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 Homeinns Hotel 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 Homeinns Hotel 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 Homeinns Hotel 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 Homeinns Hotel Group's business. In addition, Homeinns Hotel 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 Homeinns Hotel Group does. Management compensates for this and other limitations by providing specific information regarding the GAAP amounts excluded from each non-GAAP measure. Homeinns Hotel 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 Homeinns Hotel Group's future results will be unaffected by other charges and gains Homeinns Hotel Group considers to be outside the ordinary course of its business.
Homeinns Hotel Group completed its acquisition of 100% equity interest in Motel 168, or Motel, and took control of Motel effective on October 1, 2011. Homeinns Hotel Group had consolidated Motel's operating and financial results since October 1, 2011. By the third quarter of 2013, Homeinns Hotel Group had substantially completed Motel's integration and ceased to present separate operating metrics and revenues for Motel.
For investor and media inquiries, please contact:
Mingjia Ding
Homeinns Hotel Group
Tel: +86-21-3337-3333*3870
Email: mjding@homeinns.com
Cara O'Brien
FTI Consulting
Tel: +852-3768-4537
Email: cara.obrien@fticonsulting.com
Homeinns Hotel Group
Unaudited Condensed Consolidated Balance Sheet
December 31, 2014 December 31, 2015
----------------- -----------------
RMB '000 RMB '000 US$ '000
ASSETS
Current assets:
Cash and cash equivalents 949,690 1,093,695 168,837
Restricted cash 12,726 11,522 1,779
Accounts receivable, net 95,501 106,122 16,382
Receivables from related
parties 3,476 3,469 536
Consumables 44,446 51,032 7,878
Prepayments and other current
assets 171,703 246,544 38,060
Deferred tax assets 129,685 131,166 20,249
------- ------- ------
Total current assets 1,407,227 1,643,550 253,721
--------- --------- -------
Investment 11,709 14,682 2,267
Property and equipment, net 4,000,041 3,831,431 591,471
Goodwill 2,323,241 2,326,289 359,117
Intangible assets, net 1,126,636 1,079,616 166,664
Other assets 90,995 109,161 16,852
Non-current deferred tax
assets 434,847 487,596 75,272
------- ------- ------
Total assets 9,394,696 9,492,325 1,465,364
========= ========= =========
LIABILITIES
Current liabilities:
Accounts payable 86,949 103,382 15,959
Notes payable - 4,496 694
Payables to related parties 4,166 15,697 2,423
Financial liability, current
portion(2) 1,029,577 - -
Short-term loans - 424,680 65,559
Salaries and welfare payable 228,127 211,487 32,648
Income tax payable 117,830 116,340 17,960
Other taxes payable 34,074 48,188 7,439
Deferred revenues 225,417 216,123 33,364
Long-term loans, current
portion - 50,000 7,719
Other unpaid and accruals 255,460 305,481 47,160
Other payables 742,853 854,521 131,915
Deferred tax liability 60,764 46,949 7,248
------ ------ -----
Total current liabilities 2,785,217 2,397,344 370,088
--------- --------- -------
Long term loans 100,000 15,437
Deferred rental 705,284 695,008 107,291
Deferred revenues 51,289 46,349 7,155
Deposits due to franchisees 144,892 155,402 23,990
Other long term payables 13,018 5,314 820
Unfavorable lease liabilities 331,282 294,944 45,532
Deferred tax liabilities 292,575 287,817 44,431
------- ------- ------
Total liabilities 4,323,557 3,982,178 614,744
--------- --------- -------
Commitments and contingencies
Shareholders' equity
Ordinary shares (US$0.005 par
value; 200,000,000 shares
authorized, 3,698 3,757 580
95,703,960 and 97,535,374
shares issued and
outstanding as of
December 31, 2014 and
December 31, 2015,
respectively)
Additional paid-in capital 3,191,076 3,403,361 525,388
Statutory reserves 256,013 286,369 44,208
Retained earnings 1,604,246 1,740,929 268,753
Less: Treasury stock (0 and
37,696 shares as of December
31, 2014 - (2,759) (426)
and December 31, 2015,
respectively)
Total Home Inns shareholders'
equity 5,055,033 5,431,657 838,503
--------- --------- -------
Noncontrolling interests 16,106 78,490 12,117
------ ------ ------
Total shareholders' equity 5,071,139 5,510,147 850,620
--------- --------- -------
Total liabilities and
shareholders' equity 9,394,696 9,492,325 1,465,364
========= ========= =========
- - -
Note 1: The conversion of Renminbi ("RMB") into United States dollars ("US$") is based on rate of US$1.00=RMB6.4778 on December 31, 2015, representing
the certificated exchange rate published by the Federal Reserve Board.
Note 2: Financial liabilities represent convertible notes measured at fair value.
Homeinns Hotel Group
Unaudited Condensed Consolidated Statement of Operations
December 31, 2014 September 30, 2015 December 31, 2015 December 31, 2014 December 31, 2015
----------------- ------------------ ----------------- ----------------- -----------------
RMB '000 96,238 RMB '000 US$ '000 RMB '000 RMB '000 US$ '000
Revenues:
Leased-and-operated hotels 1,391,084 1,573,685 1,402,267 216,473 5,741,804 5,631,242 869,314
Franchised-and-managed hotels 244,219 282,257 275,152 42,476 940,944 1,039,871 160,528
------- ------- ------- ------ ------- --------- -------
Total revenues 1,635,303 1,855,942 1,677,419 258,949 6,682,748 6,671,113 1,029,842
Less: Business tax and related surcharges (100,323) (108,934) (99,720) (15,394) (411,118) (395,394) (61,038)
-------- -------- ------- ------- -------- -------- -------
Net revenues 1,534,980 1,747,008 1,577,699 243,555 6,271,630 6,275,719 968,804
--------- --------- --------- ------- --------- --------- -------
Operating costs and expenses:
Leased-and-operated hotel costs -
Rents and utilities (564,347) (554,722) (578,745) (89,343) (2,172,804) (2,239,521) (345,722)
Personnel costs (256,033) (293,685) (262,696) (40,553) (1,075,222) (1,107,260) (170,931)
Depreciation and amortization (187,816) (200,365) (202,325) (31,234) (742,886) (792,930) (122,407)
Consumables, food and beverage (97,864) (120,355) (113,233) (17,480) (362,760) (409,001) (63,139)
Others (192,474) (169,037) (195,657) (30,204) (669,441) (662,946) (102,341)
-------- -------- -------- ------- -------- -------- --------
Total leased-and-operated hotel costs (1,298,534) (1,338,164) (1,352,656) (208,814) (5,023,113) (5,211,658) (804,540)
Personnel costs of Franchised-and-managed hotels (34,280) (82,570) (35,670) (5,506) (201,244) (228,219) (35,231)
Sales and marketing expenses (22,700) (25,626) (41,337) (6,381) (109,813) (115,075) (17,765)
General and administrative expenses (77,426) (82,733) (122,656) (18,935) (312,008) (362,041) (55,889)
------- ------- -------- ------- -------- -------- -------
Total operating costs and expenses (1,432,940) (1,529,093) (1,552,319) (239,636) (5,646,178) (5,916,993) (913,425)
---------- ---------- ---------- -------- ---------- ---------- --------
Other income/(loss) 448 (4,165) (5,529) (854) 15,193 (7,995) (1,234)
Income from operations 102,488 213,750 19,851 3,065 640,645 350,731 54,145
------- ------- ------ ----- ------- ------- ------
Interest income 3,777 6,610 4,243 655 9,295 19,248 2,971
Interest expenses (5,674) (5,303) (5,850) (903) (41,759) (22,276) (3,439)
Loss from equity investment (193) (163) (405) (63) (324) (1,587) (245)
(Loss)/gain on change in fair value of convertible notes (7,851) (570) (7,455) (1,151) 71,945 (34,624) (5,345)
Gain/(loss) on buy-back of convertible notes - - - - 650 (1,682) (260)
Non-operating income 41,400 44,146 26,914 4,155 81,739 81,651 12,605
Foreign exchange gain/(loss), net 4,606 (35,012) (5,876) (907) (11,500) (41,034) (6,335)
----- ------- ------ ---- ------- ------- ------
Income before income tax expenses and noncontrolling interests 138,553 223,458 31,422 4,851 750,691 350,427 54,097
------- ------- ------ ----- ------- ------- ------
Income tax expense (53,064) (74,270) (43,722) (6,750) (231,323) (177,741) (27,438)
Net income/(loss) 85,489 149,188 (12,300) (1,899) 519,368 172,686 26,659
------ ------- ------- ------ ------- ------- ------
Less:Net income attributable to noncontrolling interests (918) (3,590) (750) (116) (6,253) (5,643) (871)
---- ------ ---- ---- ------ ------ ----
Net income/(loss) attributable to ordinary shareholders 84,571 145,598 (13,050) (2,015) 513,115 167,043 25,788
====== ======= ======= ====== ======= ======= ======
Earnings per share
- Basic 0.88 1.51 (0.14) (0.02) 5.38 1.74 0.27
==== ==== ===== ===== ==== ==== ====
- Diluted 0.88 1.51 (0.14) (0.02) 4.55 1.74 0.27
==== ==== ===== ===== ==== ==== ====
Weighted average ordinary shares outstanding
- Basic 95,655 96,347 96,517 96,517 95,345 96,216 96,216
====== ====== ====== ====== ====== ====== ======
- Diluted 95,655 96,347 96,517 96,517 102,814 96,238 96,238
====== ====== ====== ====== ======= ====== ======
Share-based compensation expense was included in the statement of operations as follows:
Leased-and-operated hotel costs - Personnel costs 1,856 1,349 1,763 272 7,702 6,638 1,025
Personnel costs of Franchised-and-managed hotels 3,479 2,727 3,822 590 13,152 13,423 2,072
Sales and marketing expenses 179 129 121 19 832 642 99
General and administrative expenses 15,810 13,684 11,949 1,845 66,020 55,736 8,604
Note 1: The conversion of Renminbi ("RMB") into United States dollars ("US$") is based on rate of US$1.00=RMB6.4778 on December 31, 2015, representing the certificated exchange rate published by the Federal Reserve Board.
Homeinns Hotel Group
Reconciliation of GAAP and Non-GAAP Results
Quarter Ended December 31, 2015
-------------------------------
GAAP % of Total Share-based Expenses related to Integration % of Total Non-GAAP Result % of Total
Result Revenue Compensation going private activities cost Revenue Revenue
------ ------- ------------ ------------------------ ---- ------- -------
RMB '000 RMB '000 RMB '000 RMB '000 RMB '000
(unaudited) (unaudited) (unaudited) (unaudited) (unaudited)
Leased-and-operated hotel costs (1,352,656) 80.6% 1,763 - 1,316 0.2% (1,349,577) 80.5%
Personnel costs of Franchised-and-managed hotels (35,670) 2.1% 3,822 - - 0.2% (31,848) 1.9%
Sales and marketing expenses (41,337) 2.5% 121 - - 0.0% (41,216) 2.5%
General and administrative expenses (122,656) 7.3% 11,949 41,907 317 3.2% (68,483) 4.1%
-------- ------ ------ --- -------
Total operating costs and expenses (1,552,319) 92.5% 17,655 - 1,633 3.6% (1,491,124) 88.9%
========== ====== === ===== ==========
Income from operations 19,851 1.2% 17,655 - 1,633 3.6% 81,046 4.8%
====== ====== === ===== ======
Quarter Ended December 31, 2015
-------------------------------
GAAP %of Total Share-based Expenses related to Integration %of Total Non-GAAP Result %of Total
Result Revenue Compensation going private activities cost Revenue Revenue
------ ------- ------------ ------------------------ ---- ------- -------
US$ '000 US$ '000 US$ '000 US$ '000 US$ '000
(unaudited) (unaudited) (unaudited) (unaudited) (unaudited)
Leased-and-operated hotel costs (208,814) 80.6% 272 - 203 0.2% (208,339) 80.5%
Personnel costs of Franchised-and-managed hotels (5,506) 2.1% 590 - - 0.2% (4,916) 1.9%
Sales and marketing expenses (6,381) 2.5% 19 - - 0.0% (6,362) 2.5%
General and administrative expenses (18,935) 7.3% 1,845 6,469 49 3.2% (10,572) 4.1%
------- ----- ----- --- -------
Total operating costs and expenses (239,636) 92.5% 2,726 - 252 3.6% (230,189) 88.9%
======== ===== === === ========
Income from operations 3,065 1.2% 2,726 - 252 3.6% 12,512 4.8%
===== ===== === === ======
Quarter Ended September 30, 2015
--------------------------------
GAAP %of Total Share-based Expenses related to Integration %of Total Non-GAAP Result %of Total
Result Revenue Compensation going private activities cost Revenue Revenue
------ ------- ------------ ------------------------ ---- ------- -------
RMB '000 RMB '000 RMB '000 RMB '000 RMB '000
(unaudited) (unaudited) (unaudited) (unaudited) (unaudited)
Leased-and-operated hotel costs (1,338,164) 72.1% 1,349 - 1,295 0.1% (1,335,520) 72.0%
Personnel costs of Franchised-and-managed hotels (82,570) 4.4% 2,727 - - 0.1% (79,843) 4.3%
Sales and marketing expenses (25,626) 1.4% 129 - - 0.0% (25,497) 1.4%
General and administrative expenses (82,733) 4.5% 13,684 4,797 317 1.0% (63,935) 3.4%
------- ------ ----- --- -------
Total operating costs and expenses (1,529,093) 82.4% 17,889 - 1,612 1.3% (1,504,795) 81.1%
========== ====== === ===== ==========
Income from operations 213,750 11.5% 17,889 - 1,612 1.3% 238,048 12.8%
======= ====== === ===== =======
Quarter Ended December 31, 2014
-------------------------------
GAAP %of Total Share-based Expenses related to Integration % of Total Non-GAAP Result %of Total
Result Revenue Compensation going private activities cost Revenue Revenue
------ ------- ------------ ------------------------ ---- ------- -------
RMB '000 RMB '000 RMB '000 RMB '000 RMB '000
(unaudited) (unaudited) (unaudited) (unaudited) (unaudited)
Leased-and-operated hotel costs (1,298,534) 79.4% 1,856 - 1,478 0.2% (1,295,200) 79.2%
Personnel costs of Franchised-and-managed hotels (34,280) 2.1% 3,479 - - 0.2% (30,801) 1.9%
Sales and marketing expenses (22,700) 1.4% 179 - - 0.0% (22,521) 1.4%
General and administrative expenses (77,426) 4.7% 15,810 - 317 1.0% (61,299) 3.7%
------- ------ --- --- -------
Total operating costs and expenses (1,432,940) 87.6% 21,324 - 1,795 1.4% (1,409,821) 86.2%
========== ====== === ===== ==========
Income from operations 102,488 6.3% 21,324 - 1,795 1.4% 125,607 7.7%
======= ====== === ===== =======
Note 1: The conversion of Renminbi ("RMB") into United States dollars ("US$") is based on rate of US$1.00=RMB6.4778 on December 31, 2015, representing the certificated exchange rate published by the Federal Reserve Board.
Homeinns Hotel Group
Reconciliation of GAAP and Non-GAAP Results (continued)
Year Ended December 31, 2015
----------------------------
GAAP % of Total Share-based Expenses related to Acquisition expenses Integration % of Total Non-GAAP Result % of Total
Result Revenue Compensation going private activities cost Revenue
Revenue
-------
RMB '000 RMB '000 RMB '000 RMB '000 RMB '000 RMB '000
(unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited)
Leased-and-operated hotel costs (5,211,658) 78.1% 6,638 - - 5,112 0.2% (5,199,908) 77.9%
Personnel costs of Franchised-and-managed hotels (228,219) 3.4% 13,423 - - - 0.2% (214,796) 3.2%
Sales and marketing expenses (115,075) 1.7% 642 - - - 0.0% (114,433) 1.7%
General and administrative expenses (362,041) 5.4% 55,736 46,704 - 1,268 1.6% (258,333) 3.9%
-------- ------ ------ --- ----- --------
Total operating costs and expenses (5,916,993) 88.7% 76,439 46,704 - 6,380 1.9% (5,787,470) 86.8%
========== ====== ====== === ===== ==========
Income from operations 350,731 5.3% 76,439 46,704 - 6,380 1.9% 480,254 7.2%
======= ====== ====== === ===== =======
Year Ended December 31, 2015
----------------------------
GAAP %of Total Share-based Expenses related to Acquisition expenses Integration %of Total Non-GAAP Result %of Total
Result Revenue Compensation going private activities cost Revenue Revenue
------ ------- ------------ ------------------------ ---- ------- -------
US$ '000 US$ '000 US$ '000 US$ '000 US$ '000 US$ '000
(unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited)
Leased-and-operated hotel costs (804,541) 78.1% 1,025 - - 789 0.2% (802,727) 77.9%
Personnel costs of Franchised-and-managed hotels (35,231) 3.4% 2,072 - - - 0.2% (33,159) 3.2%
Sales and marketing expenses (17,765) 1.7% 99 - - - 0.0% (17,665) 1.7%
General and administrative expenses (55,889) 5.4% 8,604 7,210 - 196 1.6% (39,880) 3.9%
------- ----- ----- --- --- -------
Total operating costs and expenses (913,426) 88.7% 11,800 7,210 - 985 1.9% (893,431) 86.8%
======== ====== ===== === === ========
Income from operations 54,144 5.3% 11,800 7,210 - 985 1.9% 74,138 7.2%
====== ====== ===== === === ======
Year Ended December 31, 2014
----------------------------
GAAP %of Total Share-based Expenses related to Acquisition expenses Integration %of Total Non-GAAP Result %of Total
Result Revenue Compensation going private activities cost Revenue Revenue
------ ------- ------------ ------------------------ ---- ------- -------
RMB '000 RMB '000 RMB '000 RMB '000 RMB '000 RMB '000
(unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited)
Leased-and-operated hotel costs (5,023,113) 75.2% 7,702 - - 6,017 0.2% (5,009,394) 75.0%
Personnel costs of Franchised-and-managed hotels (201,244) 3.0% 13,152 - - - 0.2% (188,092) 2.8%
Sales and marketing expenses (109,813) 1.6% 832 - - - 0.0% (108,981) 1.6%
General and administrative expenses (312,008) 4.7% 66,020 - 691 1,268 1.0% (244,029) 3.7%
-------- ------ --- --- ----- --------
Total operating costs and expenses (5,646,178) 84.5% 87,706 - 691 7,285 1.4% (5,550,496) 83.1%
========== ====== === === ===== ==========
Income from operations 640,645 9.6% 87,706 - 691 7,285 1.4% 736,327 11.0%
======= ====== === === ===== =======
Note 1: The conversion of Renminbi ("RMB") into United States dollars ("US$") is based on rate of US$1.00=RMB6.4778 on December 31, 2015, representing the certificated exchange rate published by the Federal Reserve Board.
Homeinns Hotel Group
Reconciliation of GAAP and Non-GAAP Results (continued)
Quarter Ended Year Ended
------------- ----------
December 31, 2014 September 30, 2015 December 31, 2015 December 31, 2014 December 31, 2015
----------------- ------------------ ----------------- ----------------- -----------------
RMB '000 RMB '000 RMB '000 US$ '000 RMB '000 RMB '000 US$ '000
(unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited)
Net income/(loss) attributable to ordinary
shareholders (GAAP) 84,571 145,598 (13,050) (2,015) 513,115 167,043 25,788
Foreign exchange (gain)/loss, net (4,606) 35,012 5,876 907 11,500 41,034 6,335
Share-based compensation 21,324 17,889 17,655 2,726 87,706 76,439 11,800
Acquisition expenses - - - - 691 - -
Expenses related to going private activities - 4,797 41,907 6,469 - 46,704 7,210
Integration cost 1,795 1,612 1,633 252 7,285 6,380 985
Gain on waived liability related with Motel
acquisition - (11,919) - -
(Gain)/loss on buy-back of convertible notes - - - - (650) 1,682 260
Loss/(gain) on change in fair value of convertible
notes 7,851 570 7,455 1,151 (71,945) 34,624 5,345
----- --- ----- ----- ------- ------ -----
Adjusted net income attributable to ordinary
shareholders (Non-GAAP) 110,935 205,478 61,476 9,490 535,783 373,906 57,721
======= ======= ====== ===== ======= ======= ======
Quarter Ended Year Ended
------------- ----------
December 31, 2014 September 30, 2015 December 31, 2015 December 31, 2014 December 31, 2015
----------------- ------------------ ----------------- ----------------- -----------------
RMB '000 RMB '000 RMB '000 US$ '000 RMB '000 RMB '000 US$ '000
(unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited)
Earnings per share (GAAP)
- Basic 0.88 1.51 (0.14) (0.02) 5.38 1.74 0.27
==== ==== ===== ===== ==== ==== ====
- Diluted 0.88 1.51 (0.14) (0.02) 4.55 1.74 0.27
==== ==== ===== ===== ==== ==== ====
Weighted average ordinary shares outstanding
- Basic 95,655 96,347 96,517 96,517 95,345 96,216 96,216
====== ====== ====== ====== ====== ====== ======
- Diluted 95,655 96,347 96,517 96,517 102,814 96,238 96,238
====== ====== ====== ====== ======= ====== ======
Adjusted earnings per share (Non-GAAP)
- Basic 1.16 2.13 0.64 0.10 5.62 3.89 0.60
==== ==== ==== ==== ==== ==== ====
- Diluted 1.13 2.05 0.64 0.10 5.43 3.83 0.59
==== ==== ==== ==== ==== ==== ====
Weighted average ordinary shares outstanding
- Basic 95,655 96,347 96,517 96,517 95,345 96,216 96,216
====== ====== ====== ====== ====== ====== ======
- Diluted 102,704 102,702 96,604 96,604 102,814 102,449 102,449
======= ======= ====== ====== ======= ======= =======
Note 1: The conversion of Renminbi ("RMB") into United States dollars ("US$") is based on rate of US$1.00=RMB6.4778
on December 31, 2015, representing the certificated exchange rate published by the Federal Reserve Board.
Note 2: The non-GAAP adjustment items do not include the tax impact.
Homeinns Hotel Group
Reconciliation of GAAP and Non-GAAP Results (continued)
Quarter Ended Year Ended
------------- ----------
December 31, 2014 Sept 30, 2015 December 31, 2015 December 31, 2014 December 31, 2015
----------------- ------------- ----------------- ----------------- -----------------
RMB '000 RMB '000 RMB '000 US$ '000 RMB '000 RMB '000 US$ '000
(unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited)
Net income/(loss) 85,489 149,188 (12,300) (1,899) 519,368 172,686 26,658
Interest income (3,777) (6,610) (4,243) (655) (9,295) (19,248) (2,971)
Interest expenses 5,674 5,303 5,850 903 41,759 22,276 3,439
Income tax expense 53,064 74,270 43,722 6,750 231,323 177,741 27,438
Depreciation and amortization 193,863 206,823 206,667 31,904 769,911 815,381 125,873
------- ------- ------- ------ ------- ------- -------
EBITDA (Non-GAAP) 334,313 428,974 239,696 37,003 1,553,066 1,168,836 180,437
------- ------- ------- ------ --------- --------- -------
Foreign exchange loss/(gain), net (4,606) 35,012 5,876 907 11,500 41,034 6,335
Share-based compensation 21,324 17,889 17,655 2,726 87,706 76,439 11,800
Acquisition expenses - - - - 691 - -
Expenses related to going private activities - 4,797 41,907 6,469 - 46,704 7,210
Integration cost 1,795 1,612 1,633 252 7,285 6,380 985
Gain on waived liability related with Motel acquisition - - - - (11,919) - -
(Gain)/loss on buy-back of convertible notes - - - - (650) 1,682 260
Loss/(gain) on change in fair value of convertible notes 7,851 570 7,455 1,151 (71,945) 34,624 5,345
----- --- ----- ----- ------- ------ -----
Adjusted EBITDA (Non-GAAP) 360,677 488,854 314,222 48,508 1,575,734 1,375,699 212,372
======= ======= ======= ====== ========= ========= =======
%of total revenue 22.1% 26.3% 18.7% 18.7% 23.6% 20.6% 20.6%
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, September 30, December 31, 2015 December 31,
2014 2015 2014 December 31, 2015
------------- -------------- ----------------- ------------- -----------------
Group Group Group Group Group
Total Hotels in operation: 2,609 2,787 2,922 2,609 2,922
Leased-and-operated hotels 914 917 929 914 929
Franchised-and-managed hotels 1,695 1,870 1,993 1,695 1,993
Total rooms 296,075 311,608 321,802 296,075 321,802
Occupancy rate (as a percentage) 79.6% 86.6% 83.1% 83.6% 83.2%
Average daily rate (in RMB) 163 171 159 165 162
RevPAR (in RMB) 130 148 132 138 134
Like-for-like performance for hotels opened for at least 18 months at the end of the period
As of and for the quarter As of and for the year
ended ended
-------------------------- -----------------------
December 31, December 31, December 31,
2014 2015 2014 December 31, 2015
------------- ------------- ------------- -----------------
Group Group Group Group
Total Hotels in operation: 1,899 2,257 1,899 2,257
Leased-and-operated hotels 844 873 844 873
Franchised-and-managed hotels 1,055 1,384 1,055 1,384
Total rooms 221,376 255,319 221,376 255,319
Occupancy rate (as a percentage) 81.3% 84.0% 85.3% 84.5%
Average daily rate (in RMB) 161 157 165 161
RevPAR (in RMB) 131 132 141 136
"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.
To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/homeinns-hotel-group-reports-fourth-quarter-and-full-year-2015-financial-results-300237105.html
SOURCE Homeinns
