HONG KONG SAR – Media OutReach – August 22, 2023 –
Tongcheng Travel Holdings Limited (“Tongcheng Travel” or the “Company”, together with its subsidiaries the “Group”, stock code: 0780.HK), an innovator and leader in China’s online travel industry, today announced its results unaudited consolidated financial statements for the six months ended June 30, 2023 (the “period under review” or “1H2023”).
Highlights of the first half of 2023 with year-over-year evolution
Robust revenues and profits increased to new heights
Revenue increased by 79.6% to RMB 5,452.4 million
· Adjusted EBITDA increased by 110.5% to RMB 1,538.0 million; adjusted EBITDA margin increased by 4.1 percentage points to 28.2%
· Adjusted net profit jumped 207.0% to RMB 1,096.0 million; adjusted net margin widened by 8.3 percentage points to 20.1%
Diverse online and offline user acquisition channels
Average MAUs increased by 27.7% to 282.5 million
· The average number of MPUs increased by 44.6% to 41.8 million.
About 87% of registered users resided in non-first-tier cities in China
Core Businesses Reached Record Revenues
· Transportation ticketing services increased by 75.8% to RMB 2,877.3 million. The volume of domestic air tickets in the second quarter of 2023 increased by 40% compared to the pre-pandemic level in the second quarter of 2019.
· Accommodation business increased by 73.9% to RMB 1,889.7 million. Domestic room nights sold increased more than 130% from pre-pandemic levels in the second quarter of 2019.
Others* revenue increased by 118.8% to RMB 685.5 million
* Others mainly include revenue from advertising services, hotel management services, corporate travel services, membership services and attraction ticketing services.
Note: MAU: Monthly Active Users; MPU: monthly paying users; APU: annual paying users
Mr. Ma Heping, Executive Director and Chairman and CEO of Tongcheng Travelsaid, “2023 marks a new chapter for China’s travel industry. We are pleased to see continued strength and accelerated quarter-over-quarter sequential growth in domestic demand, as well as growing enthusiasm for travel. Remarkable increases were seen in our traffic with MPUs and APUs. reaching record levels, primarily attributable to our diverse online channels and effective user engagement. While non-top tier cities have become increasingly popular travel destinations, our established leadership and strong penetration in these markets allows us to further exploit growing opportunities through comprehensive service. offerings geared towards an exceptional customer experience, thereby driving our long-term sustainable growth.
Diversified traffic channels, increased user engagement
Tongcheng Travel further diversified traffic sources by exploring online and offline channels, especially in under-penetrated lower-tier cities. Constant efforts have been made to better engage and serve users through the Tencent ecosystem. During the period under review, it optimized Weixin’s search functions and co-launched a WeChat Pay campaign in Hong Kong to engage with users in the region. The company continued to collaborate with Tencent games while integrating esports and sponsoring popular music festivals with Tencent Music to increase its exposure to younger audiences. These initiatives effectively drove user acquisition and engagement.
Transportation ticketing and accommodation booking business reached new heights
Driven by volume growth, transportation ticketing revenue, which accounted for 52.8% of total revenue, reached record results of RMB 2,877.3 million, an increase of 75.8% during the period under review. With continued efforts to build a more diverse user base to further penetrate the market, the volume of domestic air tickets in the second quarter of 2023 increased by 40% compared to the same period in 2019. Accommodation business, which contributed 34.7% of total revenue, continued to grow. set new heights in revenue and volume. Revenue from this business increased by 73.9% to RMB 1,889.7 million. The number of nights sold in the second quarter of 2023 increased by more than 130% compared to the second quarter of 2019.
A new hotel management activity to diversify sources of income
The Group has undertaken to diversify its activities to give it a new impetus for growth. It further developed the hotel management business by expanding its portfolio of hotel brands to include low to high rated hotels. It also tapped into the leisure travel market by acquiring travel agencies. Elong Hotel Technology Group established by the Group had signed contracts with nearly 2,000 hotels and had 15 million members. In the first half of 2023, revenue from other segments, including advertising services, hotel management services, business travel services, membership services and attraction ticketing services, recorded growth by 118.8% to reach RMB 690 million.
Leverage the technological advantage to enable intelligent digitalization of the travel industry
Tongcheng Travel is committed to applying its technological lead to contribute to a highly efficient travel ecosystem. It uses AI-powered bots to deliver more efficient customer service and has worked closely with business partners to proactively explore the application of artificial intelligence-generated content (AIGC) in its business operations. Moreover, it uses its technological lead and innovation capabilities to help upstream suppliers accelerate the smart digitalization of China’s travel industry.
In addition to this, it has established cooperation with Chengdu Shuangliu International Airport to help the airport develop a transit system to attract transit passengers and has established a strategic partnership with Henan Province Airport Group to help it to develop combined transport solutions, integrated membership programs and digitization platforms. . Additionally, through its comprehensive matrix of hotel PMS brands, the company has provided SaaS solutions to more individual hotels and chains as well as alternative accommodations to optimize their operational efficiency.
ESG efforts for sustainability have been recognized
Tongcheng Travel’s commitment to corporate sustainability has earned it inclusion in S&P Global’s Sustainability Yearbook (China) for the first time. In light of the full recovery of the travel industry, it launched a training program on digital exploitation and marketing of rural tourism for tourism professionals in Sichuan Province, to help stimulate and accelerate the growth of the rural economy. Additionally, the company has worked with more than 200 hotels across China to provide college applicants and their parents with free stationery, water and comfortable rest areas.
Mr. Ma added, “Going forward, we will continue to leverage our competitive advantages in terms of diversified traffic sources, strong market position, flexible operating strategy and advanced technology capabilities. We will further improve our products and services to provide a more satisfying experience. We will also seize market opportunities and examine international business potential. At the same time, we will explore investment opportunities that align with our strategies to support future business growth to generate long-term sustainable value for our stakeholders and communities. ”
Hashtag: #TongchengTravel
The issuer is solely responsible for the content of this announcement.
