SouFun Announces Third Quarter 2012 Results

                 SouFun Announces Third Quarter 2012 Results

PR Newswire

BEIJING, Nov. 12, 2012

BEIJING, Nov. 12, 2012 /PRNewswire/ -- SouFun Holdings Limited (NYSE: SFUN)
("SouFun"), the leading real estate and home furnishing Internet portal in
China, today announced its unaudited financial results for the third quarter
ended September 30, 2012.

Third Quarter 2012 Highlights

  oRevenue in the third quarter of 2012 was US$127.2 million, or a 17.1%
    increase from the corresponding period in 2011.
  oOperating income in the third quarter of 2012 was US$66.3 million, a 30.6%
    increase from the corresponding period in 2011. Non-GAAP operating income
    in the third quarter of 2012 was US$67.8 million, a 28.8% increase from
    the corresponding period in 2011.
  oNet income attributable to shareholders recorded a year-over-year increase
    of 14.7% to US$49.2 million, or US$0.61 per fully diluted share. Non-GAAP
    net income attributable to shareholders recorded a year-over-year increase
    of 25.6% to US$56.2 million, or US$0.70 per fully diluted share.

"We are happy to deliver another solid quarter in what has been the toughest
quarter of this year." said Vincent Mo, Executive Chairman of SouFun. "Focus
on SouFun's existing Marketing and Listing Services, together with creative
and innovative SouFun membership services in China's new home market and
SouFun Online Shop in the resale market, has supported and will continuously
support SouFun's growth story and its stronger leadership in China's home
related internet sector."

Third Quarter 2012 Results

SouFun reported total revenue of US$127.2 million for the third quarter of
2012, representing an increase of 17.1% from the corresponding period in 2011.

Revenue  from marketing services was US$79.7 million for the third quarter of
2012, a slight decrease of 2.4% from the corresponding period in 2011, due
primarily to an offset by the rapid growth of SouFun membership services which
has been mainly tested in Beijing, Shanghai and ten other major cities in
China.

Revenue from listing services was US$20.3 million for the third quarter of
2012, an increase of 23.6% from the corresponding period in 2011 primarily due
to the general recovery in the secondary real estate market and new revenue
from SouFun Online Shop which has been testing mainly in ten major cities in
China, including Beijing and Shanghai.

Revenue from e-commerce services was US$25.6 million for the third quarter of
2012, a substantial increase from US$9.5 million for the same period in 2011
due to the increasing market acceptance of SouFun membership services. We
began offering paid SouFun membership services to property buyers to
facilitate their transactions with property developers from the second quarter
of 2011.

Revenue from other value-added services and products was US$1.6 million for
the third quarter of 2012, an increase of 61.3% from the corresponding period
in 2011.

Cost of revenue was US$20.8 million for the third quarter of 2012, a slight
increase of 1.1% from the corresponding period in 2011 due primarily to
effective cost control.

Gross margin was 83.6% for the third quarter of 2012, compared with 81.0% for
the corresponding period in 2011.

Operating expenses were US$40.1 million for the third quarter of 2012, an
increase of 7.7% from the corresponding period in 2011.

Selling expenses were US$20.6 million for the third quarter of 2012, an
increase of 5.6% from the corresponding period in 2011 due primarily to
increased staff cost.

General and administrative expenses were US$19.5 million for the third quarter
of 2012, an increase of 10.1% from the corresponding period in 2011, due
primarily to increased staff cost.

Operating income was US$66.3 million for the third quarter of 2012, an
increase of 30.6% from the corresponding period in 2011. Non-GAAP operating
income was US$67.8 million, an increase of 28.8% from the corresponding period
in 2011.

Income tax expense was US$20.0 million for the third quarter of 2012, an
increase of 86.2% compared to US$10.8 million for the corresponding period in
2011, due primarily to the fact that US$5.5 million withholding tax was
accrued in the third quarter of 2012.

Net income attributable to shareholders was US$49.2 million for the third
quarter of 2012, an increase of 14.7% from the corresponding period in 2011.
Earnings per fully diluted share was US$0.61 for the third quarter of 2012,
compared with US$0.52 for the corresponding period in 2011. Non-GAAP net
income attributable to shareholders was US$56.2 million for the third quarter
of 2012, an increase of 25.6% from the corresponding period in 2011.Non-GAAP
earnings per fully diluted share was US$0.70 for the third quarter of 2012,
compared with US$0.55 for the corresponding period in 2011.

As of September 30, 2012, SouFun had cash, cash equivalents, and short-term
investments (excluding the effect from available-for-sale securities) of
US$144.5 million, compared to US$158.3 million as of December 31, 2011. This
reflected the payment of US$79.0 million in cash in a dividend of US$1.00 per
share to shareholders in the third quarter. Cash flow from operating
activities was US$55.2 million for the third quarter of 2012, compared to
US$41.2 million for the same period of 2011.

Business Outlook

SouFun raises its revenue guidance for fiscal year of 2012 from between
US$390.0 million and US$410.0 million to between US$400.0 million and US$420.0
million, representing a year-on-year increase of 16.6% to 22.2%. This forecast
reflects SouFun's current and preliminary view, which is subject to change.

Conference Call Information

SouFun' management team will host a conference call on November 12, 2012 at 8
a.m. U.S. Eastern Time (9 p.m. Beijing/Hong Kong time).

The dial-in details for the live conference call are:

US: +1 718 354 1231/ 1 866 519 4004
International: +65 6723 9381
Hong Kong: +852 2475 0994 /800 930 346
Mainland China: 800 819 0121 / 400 620 8038

Passcode: SFUN

Please dial in 10 minutes before the call is scheduled to begin and provide
the passcode to join the call.

A telephone replay of the call will be available after the conclusion of the
conference call at 11:00 a.m. U.S. Eastern Time on November 12, through
November 19,, 2012. The dial-in details for the telephone replay are:

International: +61 2 8199 0299
US Toll Free: 1855 452 5696
US Toll: +1 646 254 3697

Conference ID # 65249959

A live and archived webcast of the conference call will be available on
SouFun's website at http://ir.soufun.com.

About SouFun

SouFun operates the leading real estate Internet portal and home furnishing
and improvement website in China in terms of the number of page views and
visitors to its website in 2012. SouFun has built a large and active community
of users who are attracted by the comprehensive real estate and home
furnishing and improvement content available on its portal that forms the
foundation of its service offerings. SouFun currently maintains 106 offices to
focus on local market needs and its website and database contains real
estate-related content coverage of 314 cities in China. For more information
about SouFun, please visit http://ir.soufun.com.

Safe Harbor Statements

This announcement contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. Such forward-looking statements
are made under the "safe harbor" provisions of the U.S. Private Securities
Litigation Reform Act of 1995.

These forward-looking statements can be identified by terminology such as
"will," "expects," "is expected to," "anticipates," "aim," "future,"
"intends," "plans," "believes," "are likely to," "estimates," "may," "should"
and similar expressions. Such forward-looking statements include, without
limitation, statements regarding the outlook for the fiscal year of 2012 and
comments by management in this release about SouFun's strategic and
operational plans and focus, current and future market positions, and growth
momentum, and about China's real estate and home furnishings market. SouFun
may also make forward-looking statements in our periodic reports to the U.S.
Securities and Exchange Commission, in its annual report to shareholders, in
press releases and other written materials and in oral statements made by its
officers, directors or employees to third parties. Statements that are not
historical facts, including statements about SouFun's beliefs and
expectations, are forward-looking statements. Forward-looking statements
involve inherent risks and uncertainties. A number of important factors could
cause actual results to differ materially from those contained in any
forward-looking statement. Potential risks and uncertainties include, but are
not limited to, SouFun's limited operating history, the current global
financial and credit markets crisis and its potential impact on the Chinese
economy, measures taken or to be taken by the Chinese government to control
real estate growth and prices and other events which could occur in the
future, challenges in China's real estate market, the impact of competitive
market conditions for our services and our ability to maintain and increase
our leadership in China's home related internet sector, the uncertain
regulatory landscape in China, fluctuations in SouFun's quarterly operating
results, our continued ability to execute business strategies including our
SouFun membership services and SouFun Online Shop, our ability to continue to
expand in local markets, our reliance on online advertising sales and listing
services for our revenues, any failure to successfully develop and expand our
content, service offerings and features, including the success of new features
to meet evolving market needs, and the technologies that support them, and,
should we in the future make acquisitions, any failure to successfully
integrate acquired businesses.

Further information regarding these and other risks and uncertainties is
included in our annual report on form 20-F and other documents filed with the
U.S. Securities and Exchange Commission. SouFun does not assume any obligation
to update any forward-looking statements in this release and elsewhere, which
apply only as of the date of this press release.

About Non-GAAP Financial Measures

To supplement SouFun's consolidated financial results presented in accordance
with United States Generally Accepted Accounting Principles ("GAAP"), SouFun
uses in this press release the following measures defined as non-GAAP
financial measures by the United States Securities and Exchange Commission:
(1) operating income, (2) net income and (3) basic and diluted earnings per
ordinary share. The presentation of the non-GAAP financial information is not
intended to be considered in isolation or as a substitute for the financial
information prepared and presented in accordance with GAAP. For more
information on these non-GAAP financial measures, please see the table
captioned "Reconciliation of GAAP and non-GAAP Results" set forth at the end
of this press release.

SouFun believes that these non-GAAP financial measures provide meaningful
supplemental information to investors regarding its operating performance by
excluding share-based compensation expenses, which (1) may not be indicative
of SouFun's recurring core business operating results or (2) are not expected
to result in future cash payments. These non-GAAP financial measures also
facilitate management's internal comparisons to SouFun's historical
performance and assist its financial and operational decision making. A
limitation of using these non-GAAP financial measures is that share-based
compensation has been and will continue to be a significant recurring expense
that will continue to exist in SouFun's business for the foreseeable future.
Management compensates for these limitations by providing specific information
regarding the GAAP amounts excluded from each non-GAAP measure. The
accompanying tables have more details on the reconciliation between non-GAAP
financial measures and their most directly comparable GAAP financial measures.

For investor and media inquiries, please contact:

Dr. Hua Lei
IR Director
Tel: +86 (10) 5930 6425
E-mail: Leihua@soufun.com

Jing Wang
IR Manager
SouFun Holdings Limited
Tel: +86 (10) 5930 2500
E-mail: Bj.wangjing@soufun.com





SouFun Holdings Limited
Unaudited Condensed Consolidated Balance Sheet
( in U.S. dollars in thousands)


ASSETS                                             September 30,  December 31,
                                                   2012           2011
Current assets:
 Cash and cash equivalents                             135,042       150,414
 Restricted cash, current                              35,587        35,814
 Short-term investments                                10,305        8,592
 Accounts receivable, net                              54,956        27,697
 Customer accounts                                     14,849        -
 Prepayment and other current assets                   8,002         9,695
 Loan receivable                                       -             26,143
 Amounts due from related parties                      602           1,595
 Deferred tax assets, current                          1,596         1,602
Total current assets                                  260,939       261,552
Non-current assets:
 Property and equipment, net                           78,956        68,064
 Restricted cash, non-current portion                  355,818       247,631
 Deferred tax assets, non current                      946           1,407
 Deposit for non-current assets                        9,258         -
 Other non-current assets                              10,734        1,717
Total non-current assets                               455,712       318,819
Total assets                                           716,651       580,371
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
 Short-term loans                                      351,320       255,570
 Deferred revenue                                      103,160       73,620
 Accrued expenses and other liabilities                73,937        52,490
 Dividend payable                                      -             51,969
 Income tax payable                                    17,520        16,158
Total current liabilities                              545,937       449,807
Non-current liabilities:
 Deferred tax liabilities, non-current                 55,002        38,581
Total non-current liabilities                          55,002        38,581
Total Liabilities                                    600,939       488,388
Shareholders' equity:
 Class A and Class B Ordinary shares (par value
  of HK$1 per share: 600,000,000 shares
 authorized;
  78,150,568 (Class A-53,813,918 and Class                        
  B-24,336,650) with par value of US$10,032
 (Class                                                             
  A-US$6,908 and Class B-US$3,124) and
 79,043,477                                                         
  (Class A-54,706,827 and Class B 24,336,650 )
 with                                                  10,150        10,032
  par value of US$10,150 (Class A-US$7,025 and
 Class B-US$3,125) shares issued and
 outstanding as
  of December 31, 2011 and September 30, 2012))
 Additional paid-in capital                            58,268        49,838
 Accumulated other comprehensive income                20,108        21,853
 Retained earnings                                     27,186        10,185
Total SouFun Holdings Limited shareholders'            115,712       91,908
equity
 Noncontrolling interests                              -             75
Total shareholders' equity                             115,712       91,983
TOTAL LIABILITIES AND SHAREHOLDER'S EQUITY             716,651       580,371



SouFun Holdings Limited
Unaudited Condensed Consolidated Statement of Operations
( in U.S. dollars in thousands, except share data and per ADS data )


                                                 For the three months ended
                                                  September30,  September 30,
                                                  2012           2011
Revenues:
 Marketing services                              79,717           81,710
 Listing services                                20,312           16,435
 E-commerce services                             25,590           9,464
 Other value-added services                      1,624            1,007
Total revenues                                    127,243          108,616
Cost of Revenues:
 Cost of services                                (20,819)         (20,592)
Total Cost of Revenues                            (20,819)         (20,592)
Gross Profit                                      106,424          88,024
Operating expenses:
 Selling expenses                                (20,647)         (19,561)
 General and administrative expenses             (19,502)         (17,710)
Total Operating Expenses                          (40,149)         (37,271)
Operating Income                                  66,275           50,753
 Foreign exchange gain                          23               2
 Interest income                                 4,995            3,319
 Interest expense                                (2,262)          (787)
 Realized gain-trading securities                -                46
Government grants                                 181              281
Income before income taxes and noncontrolling     69,212           53,614
interests
Income tax expenses
 Income tax expense                              (20,042)         (10,766)
Net income                                        49,170           42,848
 Net income attributable to noncontrolling       -                (8)
interests
                                                                   
Net income attributable to SouFun Holdings
Limited shareholders                              49,170           

                                                                   42,856
Other comprehensive income, net of tax
 Foreign currency translation                    (642)            4,498
Total other comprehensive income, net of tax      (642)            4,498
Comprehensive income                              48,528           47,354
Earnings per share for Class A and Class B
ordinary shares
Basic                                             0.64             0.56
Diluted                                           0.61             0.52
Weighted average number of Class A and Class B
ordinary shares outstanding:
Basic                                             76,906,873       76,344,192
Diluted                                           80,532,484       81,949,165



SouFun Holdings Limited
Reconciliation of GAAP and Non-GAAP Results
( in U.S. dollars in thousands, except share data and per share data)
                                                  For the three months ended
                                                  September30,  September30,
                                                  2012           2011
GAAP income from operations                         66,275         50,753
Share-based compensation                            1,531          1,878
Non-GAAP income from operations                     67,806         52,631
GAAP net income                                     49,170         42,848
Withholding tax related to dividends                5,463          -
Share-based compensation                            1,531          1,878
Non-GAAP net income                                 56,164         44,726
Net Income attributable to
SouFun Holdings Limited shareholders                49,170         42,856

Withholding tax related to dividends                5,463          -
Share-based compensation expense                    1,531          1,878
Non-GAAP net Income attributable to SouFun          56,164         44,734
Holdings Limited shareholders
GAAP earnings per share for Class A and Class B
ordinary shares:
Basic                                               0.64           0.56
Diluted                                             0.61           0.52
Non-GAAP earnings per share for Class A and
Class B ordinary shares:
Basic                                               0.73           0.59
Diluted                                             0.70           0.55
Weighted average number of Class A and Class B
ordinary shares outstanding:
Basic                                               76,906,873     76,344,192
Diluted                                             80,532,484     81,949,165



SOURCE SouFun Holdings Limited

Website: http://ir.soufun.com