eLong reports 14% drop in revenue y-o-y for Q1 2015
eLong, reported net revenues in Q1 2015 decreased 14% to RMB211.9 million y-o-y.
BEIJING, April 30, 2015 /PRNewswire/ -- eLong, Inc. a leading mobile and online travel service provider in China, today reported unaudited financial results for the first quarter ended March 31, 2015.
Accommodation reservation* room nights stayed in the first quarter increased 34% to 9.3 million room nights compared to 7.0 million in the prior year period.
Mobile bookings comprised more than 65% of eLong brand room nights** in the first quarter, and cumulative downloads of eLong mobile apps reached approximately 200 million.
Domestic hotel coverage network expanded 180% to over 280,000 domestic hotels as of March 31, 2015, compared to 100,000 as of March 31, 2014.
More than 35,000 properties have contracted to use the free, cloud-based, multi-device hotel property management systems, Yunzhanggui and Zhuzhe, produced by our investee companies.
"Our lodging network has grown to more than 280,000 properties in China and approximately 510,000 properties worldwide. Facing fierce competition, we are innovating more quickly and investing more in our products, technology and marketing than at any time in our history. We will continue to invest in order to continue to accelerate our room night growth in the remainder of 2015," said Guangfu Cui, Chief Executive Officer of eLong.
Net revenues for the first quarter decreased 14% to RMB211.9 million (US$34.2 million), compared to RMB246.1 million (US$39.6 million) in the first quarter of 2014.
Accommodation reservation revenues decreased 7% in the first quarter of 2015 compared to the same period in 2014, primarily due to lower revenue per room night, partially offset by higher volume. Room nights stayed in the first quarter increased 34% year-on-year to 9.3 million, and revenue per room night decreased due to the lower commission rate room nights for which we recognize revenues on a net basis, the growth of our aggressive coupon program, and significant direct discounts in our merchant hotel business, partially offset by the growth of hotel room night transactions for which we take inventory risk and recognize revenues on a gross basis. Accommodation reservation revenues comprised 84% of total revenues, compared to 78% in the prior year quarter.
Transportation tickets increased to 1.6 million in the first quarter, an increase of 95% compared to the prior year period, primarily due to the growth of train tickets. Transportation ticketing revenues decreased 37% in the first quarter, primarily due to a decrease in air commission revenue per ticket. The decline in air commission revenue per ticket was primarily due to the lowering by major Chinese airlines of the base air commission rate from 3% to 2% in July 2014 and subsequently from 2% to 1% in February 2015. Transportation ticketing revenue decreased to 11% of our total revenues from 15% in the prior year quarter.
Other revenues are primarily derived from advertising business. Other revenue decreased 42% year-on-year in the first quarter of 2015, mainly driven by decreased advertising revenue as a result of our disposition of Nanjing Xici Information Technology Share Co., Ltd. ("Nanjing Xici") in the first quarter of 2015. Other revenue decreased to 5% of total revenues in the first quarter from 7% in the prior year quarter.
Gross margin in the first quarter of 2015 decreased to 29% from 73% in the prior year quarter.The decline in gross margin in the first quarter of 2015 was primarily due to lower revenue per room night and the growth of hotel room night transactions for which we take inventory risk and recognize revenue on a gross basis.
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