Tuniu(TOUR) - 2022 Q4 - Annual Report

Financial Performance Overview Third Quarter 2022 Key Financial Results In Q3 2022, Tuniu's net revenues decreased by 32.1% to RMB77.9 million due to COVID-19, yet net loss narrowed to RMB23.5 million with gross margin improving to 57.8% through cost control - The CEO highlighted that despite uncertainties, the company focused on the vacation market, leveraged its integrated model, and implemented cost control measures to improve operational efficiency[2] Q3 2022 Key Financial Metrics (RMB) | Metric | Q3 2022 | Q3 2021 | YoY Change | | :--- | :--- | :--- | :--- | | Net Revenues | 77.9 million | 114.6 million | -32.1% | | Gross Margin | 57.8% | 34.7% | +23.1 p.p. | | Loss from Operations | 14.3 million | 56.6 million | N/A (Loss Narrowed) | | Net Loss | 23.5 million | 36.6 million | N/A (Loss Narrowed) | Revenue Analysis Total net revenues for Q3 2022 declined 32.1% to RMB77.9 million, primarily due to a 54.3% drop in packaged tour revenues, partially offset by a 52.3% increase in other revenues Q3 2022 Revenue Breakdown (RMB) | Revenue Stream | Q3 2022 | YoY Change | | :--- | :--- | :--- | | Packaged Tours | 41.4 million | -54.3% | | Other Revenues | 36.4 million | +52.3% | | Total Net Revenues | 77.9 million | -32.1% | Cost and Gross Margin Cost of revenues significantly decreased by 56.2% to RMB32.8 million in Q3 2022, leading to a substantial improvement in gross margin from 34.7% to 57.8% - Cost of revenues as a percentage of net revenues decreased to 42.2% in Q3 2022, down from 65.3% in Q3 2021[4] Q3 2022 Cost and Margin Performance (RMB) | Metric | Q3 2022 | Q3 2021 | | :--- | :--- | :--- | | Cost of Revenues | 32.8 million | 74.9 million | | Gross Margin | 57.8% | 34.7% | Operating Expenses Operating expenses were successfully reduced by 38.5% to RMB59.3 million in Q3 2022, driven by significant cuts across research, sales, marketing, and general administrative costs Q3 2022 Operating Expense Breakdown (RMB) | Expense Category | Q3 2022 | YoY Change | | :--- | :--- | :--- | | Research & Product Development | 9.7 million | -37.6% | | Sales & Marketing | 26.5 million | -36.4% | | General & Administrative | 24.3 million | -41.1% | | Total Operating Expenses | 59.3 million | -38.5% | Profitability Analysis Tuniu significantly narrowed its Q3 2022 losses, with loss from operations decreasing to RMB14.3 million and net loss attributable to shareholders reducing to RMB22.0 million, reflecting effective cost control Q3 2022 Profitability Metrics (RMB) | Metric | Q3 2022 (GAAP) | Q3 2021 (GAAP) | | :--- | :--- | :--- | | Loss from Operations | (14.3 million) | (56.6 million) | | Net Loss | (23.5 million) | (36.6 million) | | Net Loss Attributable to Shareholders | (22.0 million) | (35.1 million) | - On a non-GAAP basis, loss from operations was RMB12.3 million and net loss was RMB21.6 million[9][10] Liquidity and Financial Position As of September 30, 2022, Tuniu maintained a strong liquidity position with RMB949.6 million (US$133.5 million) in cash and equivalents, deemed sufficient for future operational needs - The company held cash and cash equivalents, restricted cash, and short-term investments totaling RMB949.6 million (US$133.5 million) as of September 30, 2022[12] - Management believes available cash and investments are sufficient for working capital and capital expenditures for the next twelve months[12] Corporate Updates and Outlook Management Changes Tuniu appointed Mr. Jie Chen as a new independent director effective December 1, 2022, enhancing the board's independent majority - Mr. Jie Chen was appointed as an independent director to the Board, replacing Mr. Jiangtao Liu, effective December 1, 2022[13] - Mr. Chen currently serves as chairman of Caissa Tourism (000796. SZ) and has extensive experience in the tourism industry[14] Business Outlook For Q4 2022, Tuniu forecasts net revenues between RMB23.5 million and RMB30.8 million, anticipating a significant year-over-year decrease of 58% to 68% - The company expects net revenues for Q4 2022 to be between RMB23.5 million and RMB30.8 million, representing a 58% to 68% decrease year-over-year[15] Financial Statements Unaudited Condensed Consolidated Balance Sheets As of September 30, 2022, Tuniu's balance sheet shows total assets of RMB2.16 billion, total liabilities of RMB1.07 billion, and total equity of RMB1.06 billion, with current assets exceeding current liabilities Key Balance Sheet Items (in thousands RMB) | Account | Sep 30, 2022 | Dec 31, 2021 | | :--- | :--- | :--- | | Total Current Assets | 1,463,247 | 1,475,442 | | Total Assets | 2,160,889 | 2,297,809 | | Total Current Liabilities | 1,025,422 | 979,013 | | Total Liabilities | 1,072,886 | 1,044,668 | | Total Equity | 1,060,803 | 1,225,941 | Unaudited Condensed Consolidated Statements of Comprehensive Loss The Q3 2022 comprehensive loss statement reports net revenues of RMB77.9 million, a gross profit of RMB45.0 million, total operating expenses of RMB59.3 million, and a net loss of RMB23.5 million Q3 2022 Income Statement Summary (in thousands RMB) | Line Item | Q3 2022 | Q3 2021 | | :--- | :--- | :--- | | Net Revenues | 77,858 | 114,624 | | Gross Profit | 45,023 | 39,740 | | Loss from Operations | (14,256) | (56,626) | | Net Loss | (23,504) | (36,579) | | Net Loss per ADS | (0.18) | (0.27) | Reconciliations of GAAP and Non-GAAP Results This section reconciles Q3 2022 GAAP to non-GAAP results, showing a non-GAAP loss from operations of RMB12.3 million and a non-GAAP net loss attributable to shareholders of RMB20.1 million after adjustments Q3 2022 GAAP to Non-GAAP Reconciliation (in thousands RMB) | Metric | GAAP Result | Adjustments | Non-GAAP Result | | :--- | :--- | :--- | :--- | | Loss from Operations | (14,256) | 1,931 | (12,325) | | Net Loss Attributable to Shareholders | (22,048) | 1,931 | (20,117) | - Primary adjustments for GAAP to Non-GAAP reconciliation include share-based compensation expenses and amortization of acquired intangible assets[20][30] Supplementary Information Conference Call Information Tuniu scheduled an earnings conference call for December 1, 2022, at 8:00 am U.S. Eastern Time to discuss its third-quarter financial results - An earnings conference call was scheduled for December 1, 2022, at 8:00 am U.S. Eastern Time[16] - Details for live participation, telephone replay, and an archived webcast were provided for investors[16][17] About Tuniu & Safe Harbor Statement This section provides Tuniu's corporate profile as a leading online leisure travel company in China, followed by a safe harbor statement regarding forward-looking statements and associated risks - Tuniu is described as a leading online leisure travel company in China offering packaged tours and travel-related services via its website and mobile platform[18] - The safe harbor statement warns that forward-looking statements are subject to risks, including the impact of COVID-19, competition, and government policies[19] About Non-GAAP Financial Measures Tuniu utilizes non-GAAP financial measures, excluding items like share-based compensation and amortization of acquired intangibles, to provide a clearer view of underlying business performance - The company uses non-GAAP measures to provide a clearer understanding of underlying business performance by excluding certain non-cash or non-recurring items[20] - Key exclusions from GAAP results include share-based compensation expenses, amortization of acquired intangible assets, gain on disposals of subsidiaries, and impairment of goodwill[20][21]