Elong (NASDAQ:LONG)

Highlights - Fourth Quarter 2011

• Hotel room nights booked through eLong in the fourth quarter increased 50% to 2.6 million room nights compared to 1.7 million in the prior year period.
• Net revenues for the fourth quarter increased 27% to RMB158.2 million (US$25.1 million), compared toRMB124.1 million (US$18.8 million) in the fourth quarter of 2010.
• Net income for the fourth quarter increased to RMB15.0 million (US$2.4 million), compared to RMB4.2 million (US$0.6 million) in the fourth quarter of 2010.
• Domestic hotel coverage network expanded 48% to over 25,500 domestic hotels as of December 31, 2011, compared to 17,200 as of December 31, 2010. In addition, eLong offers almost 149,000 international hotels through a direct connection to Expedia.
• Online hotel bookings in the fourth quarter were approximately 63% of total hotel bookings, compared to 45% in the same period in 2010.
• In December 2011, monthly room nights booked through eLong's group buy channel exceeded 100,000 for the first time.
• Received China's 2011 Best Online Travel Service Provider award as selected through an online poll organized by Sohu and Ipsos.

"We continue to execute on our online hotel-focused strategy and customers are enthusiastically responding. During the quarter, we launched customer enhancements to both our award-winning online and developing mobile channels driving additional customers to our rapidly increasing supply of hotels, including over 25,500 domestic and almost 149,000 international hotels," said Guangfu Cui, Chief Executive Officer of eLong.

Third Quarter 2011 Results

• Net revenues increased 19% to RMB164.3 million (US$25.8 million), compared to RMB137.8 million (US$20.6 million) in the third quarter of 2010.
• Net income per ADS and diluted net income per ADS for the third quarter of 2011 were RMB0.28 (US$0.04), compared to net income per ADS and diluted net income per ADS for the prior year quarter of RMB0.04 (US$0.01).

"Our customers continue to respond strongly to our market leading hotel network of over 23,000 domestic hotels and 145,000 international hotels, our easy-to-use hotel website and mobile applications and our competitive prices. In addition, we continue to drive innovation in the travel sector through our Group Buying and Last-Minute hotel offerings," said Guangfu Cui, Chief Executive Officer of eLong. "I am also pleased to report that approximately sixty percent of our hotel customers now book online at eLong.com and through our mobile applications."

First Quarter Results:

• Net revenues for the first quarter increased 23% to RMB124.5 million (US$19.0 million), compared to RMB101.1 million (US$14.8 million) in the first quarter of 2010.
• Income from operations for the first quarter increased 111% to RMB13.2 million (US$2.0 million), compared to RMB6.3 million (US$0.9 million) in the prior year period. Operating margin was 10.6% compared to 6.2% in the first quarter of 2010.
• Net income for the first quarter increased 30% to RMB7.7 million (US$1.2 million), compared to RMB5.9 million (US$0.9 million) in the first quarter of 2010.

"In the first quarter, eLong accelerated the growth of its core online hotel business. We were pleased to see nearly half of our customers now choosing to book hotel online. We expect our hotel online bookings will for the first time exceed our call center bookings in the second quarter. This is a great milestone for both eLong's online hotel booking strategy and China's online travel industry! We also continued to drive product innovation with our next generation iPhone application which is currently in the Top 10 travel downloads in China's iTunes App Store," said Guangfu Cui, Chief Executive Officer of eLong.

• Net income per ADS and diluted net income per ADS for the first quarter of 2011 were RMB0.32 (US$0.04) and RMB0.30 (US$0.04) respectively, compared to net income per ADS and diluted net income per ADS for the prior year quarter of RMB0.26 (US$0.04) and RMB0.24 (US$0.04) respectively.

Fourth Quarter Results:

• Net revenues for the fourth quarter increased 23% to RMB124.1 million (US$18.8 million), compared to RMB100.9 million (US$14.8 million) in the fourth quarter of 2009.
• Income from operations for the fourth quarter increased to RMB12.6 million (US$1.9 million), compared to RMB2.4 million (US$0.3 million) in the prior year period. 
• Net income increased to RMB4.2 million (US$0.6 million), compared to RMB1.0 million (US$0.1 million) in the fourth quarter of 2009.
• Net income per ADS and diluted net income per ADS for the fourth quarter of 2010 were RMB0.18 (US$0.02) and RMB0.16 (US$0.02) respectively, compared to both net income per ADS and diluted net income per ADS of RMB0.04 (US$0.01) in the prior year quarter.
• Adjusted diluted net income per ADS for the fourth quarter of 2010 were US$0.04 and RMB0.16 (US$0.02)compared to $0.01 in the prior year quarter.

Guidance:

eLong currently expects net revenues for the first quarter of 2011 to be within the range of RMB111 million to RMB121 million, equal to an increase of 10% to 20% compared to the first quarter of 2010.

"In 2010, eLong really accelerated the growth of its core online hotel business. Room night growth was 49% year-on-year as our customers welcomed the real savings available from our coupon program, and our expanded hotel coverage network of over 17,200 domestic and 130,000 international hotels. We were also pleased to see the positive customer response to our much improved website booking experience with over 45% of our customers now choosing to book online," said Guangfu Cui, Chief Executive Officer of eLong.

Highlights - Third Quarter 2010

• Net revenues increased 42% to RMB137.8 million, compared to RMB97.2 million in the third quarter of 2009.

• Income from operationsincreased 104% to RMB12.0 million, compared to RMB5.9 million in the third quarter of 2009. Operating margin was 8.7% compared to 6.1% in the third quarter of 2009.

• Net income for the third quarter of 2010 wasRMB1.2 million, compared to net income of RMB7.5 millionduring the prior year quarter.

• Net income per ADS and diluted net income per ADS for the third quarter of 2010 were RMB0.04, compared to net income per ADS and diluted net income per ADS for the prior year quarter of RMB0.32 and RMB0.30, respectively.

• Non-GAAP per ADS was $0.60 vs. $0.42

Business Outlook

eLong currently expects net revenues for the fourth quarter of 2010 to be within the range of RMB116 million to RMB126 million, equal to an increase of 15% to 25% compared to the fourth quarter of 2009.