Homeinns Hotel Group Reports Fourth Quarter and Full Year 2015 Financial Results

2,922 Hotels in Operation in 355 Cities across China

16 Mar, 2016, 17:00 ET from Homeinns

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 portion2

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, 95,703,960 and 97,535,374 shares issued and outstanding as of December 31, 2014 and December 31, 2015, respectively)

3,698

3,757

580

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 and December 31, 2015, respectively)

-

(2,759)

(426)

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 Result

% of Total Revenue

Share-based Compensation

Expenses related to going private activities

 Integration  cost

% of Total Revenue

Non-GAAP Result

 % of Total 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 Result

%of Total Revenue

Share-based Compensation

Expenses related to going private activities

 Integration  cost

%of Total Revenue

Non-GAAP Result

%of Total 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 Result

%of Total Revenue

Share-based Compensation

Expenses related to going private activities

 Integration  cost

%of Total Revenue

Non-GAAP Result

%of Total 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 Result

%of Total Revenue

Share-based Compensation

Expenses related to going private activities

 Integration  cost

 % of Total Revenue

Non-GAAP Result

%of Total 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 Result

% of Total Revenue

Share-based Compensation

Expenses related to going private activities

Acquisition expenses

Integration cost

% of Total 

Revenue

Non-GAAP Result

% of Total 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 Result

%of Total Revenue

Share-based Compensation

Expenses related to going private activities

Acquisition expenses

 Integration  cost

%of Total Revenue

Non-GAAP Result

%of Total 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 Result

%of Total Revenue

Share-based Compensation

Expenses related to going private activities

Acquisition expenses

 Integration  cost

%of Total Revenue

Non-GAAP Result

%of Total 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, 2014

September 30, 2015

December 31, 2015

December 31, 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 ended

As of and for the year ended

December 31, 2014

December 31, 2015

December 31, 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.

 

SOURCE Homeinns



RELATED LINKS

http://english.homeinns.com