Trip.com Group Ltd ADR (NASDAQ:TCOM), a leading one-stop travel service provider of accommodation reservation, transportation ticketing, packaged tours and corporate travel management, today announced its unaudited financial results for the fourth quarter and full year of 2021.
Key Highlights for the Fourth Quarter and Full Year of 2021
Our business has shown resilience with consistent results mainly driven by the recovery in the Chinese domestic market
- Net revenue remained largely stable for the fourth quarter and increased by 9% for the full year of 2021, both on a year-over-year basis.
- Short-haul travel continued to serve as a key contributor to the recovery of the Chinese domestic market, with the number of intra-provincial and local hotel reservations for the fourth quarter increasing by over 30% and 50% respectively compared to the same period in 2019.
- Revenues from corporate travel management experienced a year-over-year growth of 20% for the fourth quarter and a year-over-year growth of 54% for the full year of 2021.
- Adjusted EBITDA was RMB 54 million (US$7 million) for the fourth quarter and RMB 1.3 billion (US$203 million) for the full year of 2021. Adjusted EBITDA margin was 1% for the fourth quarter and 6% for the full year of 2021.
"2021 was a year full of challenges and opportunities. On the bumpy path to recovery, we have built solid resilience and become fundamentally stronger," said James Liang, Executive Chairman. "During the past year, we have further expanded our product offerings and improved our content capabilities, which pave the way for our sustainable growth in the longer-term. Going forward, we will continue to focus on the business recovery in the Chinese domestic market while remaining ambitious with our global vision towards global travel reopening."
"Despite the industry fluctuations and weaker seasonality, we delivered another solid performance in the fourth quarter" said Jane Sun, Chief Executive Officer. "We will remain adaptive facing fast-changing market conditions and continue to adopt stringent cost control. Meanwhile, we are also working hard to create more value for our customers, industry partners, and the society at large."
Fourth Quarter and Full Year of 2021 Financial Results and Business Updates
For the fourth quarter of 2021, a few waves of COVID-19 infections reemerged in certain regions of China, which discouraged user demand for the Company's products. As a result, the Company's results of operations for the fourth quarter of 2021 were materially and adversely affected.
For the fourth quarter of 2021, Trip.com Group reported net revenue of RMB4.7 billion (US$735 million), representing a 6% decrease from the same period in 2020. Net revenue for the fourth quarter of 2021 decreased by 12% from the previous quarter, primarily due to the re-emergence of COVID-19 infections in certain regions in China.
For the full year of 2021, net revenue was RMB20.0 billion (US$3.1 billion), representing a 9% increase from 2020.
Accommodation reservation revenue for the fourth quarter of 2021 was RMB1.9 billion (US$301 million), representing a 14% decrease from the same period in 2020, and a 13% decrease from the previous quarter, primarily due to the re-emergence of COVID-19 infections in certain regions in China.
For the full year of 2021, accommodation reservation revenue was RMB8.1 billion (US$1.3 billion), representing a 14% increase from 2020. The accommodation reservation revenue accounted for 41% of the total revenue in 2021 and 39% of the total revenue in 2020.
Transportation ticketing revenue for the fourth quarter of 2021 was RMB1.5 billion (US$238 million), representing a 11% decrease from the same period in 2020, and a 17% decrease from the previous quarter, primarily due to the re-emergence of COVID-19 infections in certain regions in China.
For the full year of 2021, transportation ticketing revenue was RMB6.9 billion (US$1.1 billion), representing a 3% decrease from 2020. The transportation ticketing revenue accounted for 34% of the total revenue in 2021 and 39% of the total revenue in 2020.
Packaged-tour revenue for the fourth quarter of 2021 was RMB177 million (US$28 million), representing a 32% decrease from the same period in 2020 and a 55% decrease from the previous quarter, primarily due to the re-emergence of COVID-19 infections in certain regions in China.
For the full year of 2021, packaged-tour revenue was RMB1.1 billion (US$173 million), representing an 11% decrease from 2020. The packaged-tour revenue accounted for 6% of the total revenue in 2021 and 7% of the total revenue in 2020.
Corporate travel revenue for the fourth quarter of 2021 was RMB367 million (US$58 million), representing a 20% increase from the same period in 2020 and a 9% increase from the previous quarter, primarily driven by expansion in corporate customer base and an optimized product mix.
For the full year of 2021, corporate travel revenue was RMB1.3 billion (US$211 million), representing a 54% increase from 2020. The corporate travel revenue accounted for 7% of the total revenue in 2021 and 5% of the total revenue in 2020.
Cost of revenue for the fourth quarter of 2021 increased by 23% to RMB1.1 billion (US$176 million) from the same period in 2020, primarily due to an increase in compensation to customer service center personnel. Cost of revenue decreased by 9% compared to the previous quarter. Cost of revenue as a percentage of net revenue was 24% for the fourth quarter of 2021.
For the full year of 2021, cost of revenue increased by 14% to RMB4.6 billion (US$721 million) from 2020, amounting to 23% as a percentage of net revenue.
Product development expenses for the fourth quarter of 2021 increased by 3% to RMB2.2 billion (US$351 million) from the same period in 2020 and decreased by 3% from the previous quarter. Product development expenses as a percentage of net revenue was 48% for the fourth quarter of 2021.
For the full year of 2021, product development expenses increased by 17% to RMB9.0 billion (US$1.4 billion) from 2020, amounting to 45% as a percentage of net revenue.
Sales and marketing expenses for the fourth quarter of 2021 increased by 5% to RMB1.3 billion (US$204 million) from the same period in 2020 and stayed flat from the previous quarter. Sales and marketing expenses as a percentage of net revenue was 28% for the fourth quarter of 2021.
For the full year of 2021, sales and marketing expenses increased by 12% to RMB4.9 billion (US$772 million) from 2020, amounting to 25% as a percentage of net revenue.
General and administrative expenses for the fourth quarter of 2021 increased by 8% to RMB733 million (US$115 million) from the same period in 2020 and decreased by 7% from the previous quarter. General and administrative expenses as a percentage of net revenue was 16% for the fourth quarter of 2021.
For the full year of 2021, general and administrative expenses decreased by 20% to RMB2.9 billion (US$459 million) from 2020, amounting to 15% as a percentage of net revenue.
Income tax expense for the fourth quarter of 2021 was RMB37 million (US$6 million), compared to income tax expense of RMB163 million in the same period in 2020 and income tax expense of RMB95 million in the previous quarter. The change in our effective tax rate was primarily due to the non-taxable income of the fair value changes in equity securities investments and exchangeable senior notes, as well as the change in valuation allowance provided to deferred tax assets.
For the full year of 2021, income tax expense was RMB270 million (US$42 million), compared to RMB355 million in 2020.
Net loss attributable to Trip.com Group's shareholders for the fourth quarter of 2021 was RMB834 million (US$131 million), compared to net income attributable to Trip.com Group's shareholders of RMB1.0 billion in the same period in 2020 and net loss attributable to Trip.com Group's shareholders of RMB849 million in the previous quarter. Excluding share-based compensation charges and fair value changes of equity securities investments and exchangeable senior notes recorded in other income/(expense), non-GAAP net income attributable to Trip.com Group's shareholders was RMB309 million (US$48 million), compared to non-GAAP net income attributable to Trip.com Group's shareholders of RMB1.1 billion in the same period in 2020 and non-GAAP net income attributable to Trip.com Group's shareholders of RMB523 million in the previous quarter.
For the full year of 2021, net loss attributable to Trip.com Group's shareholders was RMB550 million (US$86 million), compared to net loss attributable to Trip.com Group's shareholders of RMB3.2 billion in 2020. Excluding share-based compensation charges and fair value changes of equity securities investments and exchangeable senior notes, non-GAAP net income attributable to Trip.com Group's shareholders was RMB1.4 billion (US$213 million) in 2021, compared to non-GAAP net loss attributable to Trip.com Group's shareholders of RMB913 million in 2020
Adjusted EBITDA for the fourth quarter of 2021 was RMB54 million (US$7 million), compared to RMB799 million in the same period in 2020 and RMB537 million in the previous quarter. Adjusted EBITDA margin was 1% for the fourth quarter of 2021, compared to 16% in the same period in 2020 and 10% in the previous quarter.
For the full year of 2021, adjusted EBITDA was RMB1.3 billion (US$203 million), compared to adjusted EBITDA of RMB1.7 billion in 2020. Adjusted EBITDA margin was 6% in 2021, compared to 9% in 2020.
Diluted loss per ordinary share and per ADS was RMB1.29 (US$0.20) for the fourth quarter of 2021. Excluding share-based compensation charges and fair value changes of equity securities investments and exchangeable senior notes, non-GAAP diluted earnings per ordinary share and per ADS was RMB0.48 (US$0.08) for the fourth quarter of 2021. Each ADS currently represents one ordinary share of the Company.
For the full year of 2021, diluted losses per share and per ADS was RMB0.87 (US$0.14). Excluding share-based compensation charges and fair value changes of equity securities investments and exchangeable senior notes, non-GAAP diluted income per share and per ADS was RMB2.12 (US$0.33). Each ADS currently represents one ordinary share of the Company.
As of December 31, 2021, the balance of cash and cash equivalents, restricted cash, short-term investment, held to maturity time deposit and financial products was RMB63.9 billion (US$10.0 billion).