Ctrip happy despite falling profits
Contributors are not employed, compensated or governed by TD, opinions and statements are from the contributor directly
Chinese travel company Ctrip International said it achieved a “great performance” in the first quarter of the year, despite a sharp drop in profits.
The company’s net profits fell 25% year-on-year to CNY115 million (US$18.7m), mainly due to a significant rise in expenses.
Ctrip’s revenues actually jumped 36% to CNY1.6 billion, but a 65% hike in product development costs and a 61% rise in sales & marketing expenses hit the company’s bottom line. Operating profits sank 56% to CNY71m.
But despite this, Ctrip’s CEO James Liang said he was happy with the quarterly performance and his company’s continued expansion.
“We are pleased to report the great performance in the first quarter of 2014,” said Liang. “We recently expanded our traditional hotel reservation and ticketing services… [and] the growth of both businesses is on the accelerating track with volume increasing 67% and 71% year-on-year, respectively.
“We are also very proud to see our new businesses start to take leading positions. For example, Ctrip Travel Community Channel experienced over 300% year-on-year growth in daily unique visitors and became the top player among travel information and community websites in China,” he added.
Ctrip also experienced a surge in mobile bookings in Q1. The company’s total mobile transaction value increased four-fold compared with first quarter of 2013, and Ctrip revealed that mobile has now surpassed PC internet as its biggest booking platform for accommodation reservations, contributing more than 40% of total transactions during the quarter.
For the second quarter of 2014, Ctrip expects to see continued strong revenue growth, in the region of 30-35%, although expenses are also likely to rise.
Comments are closed.