Home Inns Group Reports Fourth Quarter and Full Year 2012 Financial Results

 Home Inns Group Reports Fourth Quarter and Full Year 2012 Financial Results

Annual Revenues Increased 46% to RMB 5.77 billion

1,772 Hotels in 253 Cities in China at Year End

PR Newswire

SHANGHAI, March 11, 2013

SHANGHAI, March 11, 2013 /PRNewswire/ - Home Inns & Hotels Management Inc.
(NASDAQ: HMIN) ("Home Inns Group" or "the Company"), a leading economy hotel
chain in China,  today announced its unaudited financial results for the
fourth quarter and full year ended December 31, 2012.

Home Inns Group acquired Motel 168 and has consolidated Motel 168's operating
and financial results since October 1, 2011. Consolidated group numbers are
presented in this earnings release unless specifically noted. For the purpose
of providing more context and comprehensive information to investors, Home
Inns Group separately presents key financial data excluding Motel 168 in this
earnings release in Appendix 1.

Fourth Quarter and Full Year 2012 Financial Highlights

  oTotal revenues increased 11.9% to RMB 1.47 billion for the fourth quarter
    of 2012 and increased 45.7% to RMB 5.770 billion for the full year 2012,
    which was within the higher end of the guidance range of RMB 5.715 billion
    to RMB 5.810 billion.
  oAdjusted EBITDA (non-GAAP) increased 14.6% to RMB 260.5 million (US$41.8
    million) for the fourth quarter of 2012 and increased 25.9% to RMB 1.13
    billion (US$181.9 million) for the full year 2012

KeyFinancialResults
(RMB Million except RMB per ADS)                 4Q12    4Q11    V%     FY12    FY11    V%
Total Revenues                                   1,465.7 1,309.9 11.9%  5,769.7 3,959.7 45.7%
Income from Operations                           36.3    33.2    9.3%   273.7   297.4   -8.0%
 Adj. Income from Operations*                 79.2    78.5    0.9%   464.1   457.3   1.5%
Net Income/Loss                                  6.3     32.7    -80.7% -26.8   351.5   -107.6%
 Adj. Net Income/Loss*                         80.6    36.6    120.2% 300.3   326.1   -7.9%
EBITDA*                                          188.2   229.2   -17.9% 849.5   949.0   -10.5%
 Adj. EBITDA*                                 260.5   227.4   14.6%  1,133.4 900.2   25.9%
Diluted Earnings/Losses per ADS                  0.14    -0.12   F      -0.59   2.51    UF
 Adj. Diluted Earnings/Losses per ADS*        1.74    0.73    F      6.62    6.92    UF


Note: Consolidation of Motel 168 financial results started October 1, 2011 impacting comparability of
full year results
*Indicates non-GAAP financial measures which exclude any applicable non-recurring items or items not
directly impacting underlying business operations, mainly, share-based compensation expenses,
acquisition and integration expenses, amortization on up-front fees of acquisition term loans and
gain or loss on change in fair value of convertible notes. (see commentary at the end of this
earnings release for further details)

Fourth Quarter and Full Year 2012 Operational Highlights

  oHome Inns Group opened 366 new hotels in 2012, exceeding the guidance
    range of 330 to 360. As of December 31, 2012, the Group operated 1,772
    hotels across 253 cities in China under its three brands. There were a
    total of 241 hotels contracted or under construction at the end of 2012
    including 170 franchised-and-managed hotels representing a strong
    pipe-line for this business model.

                              Hotels in Operations         Openings  Closures
As of December 31, 2012       Group Home     Motel   Yitel 4Q12 FY12 4Q12 FY12
                                    Inns     168
Total number of Hotels        1,772 1,431    334     7     96   366  6    20
 Leased-and-Operated       803   646      151     6     33   109  1    5
 Franchised-and-Managed    969   785      183     1     63   257  5    15
Contracted or under           241   211      26      4
Construction
 Leased-and-Operated       71    56       13      2
 Franchised-and-Managed    170   155      13      2

  oAs of December 31, 2012, Home Inns Group had a total of 11.9 million
    unique active non-corporate members under its frequent guests programs.

Operating Metrics

                                         4Q2012 3Q2012 4Q2011 FY2012 FY2011
Occupancy Rate                           83.8%  90.3%  84.2%  86.1%  88.8%
Average Daily rate (ADR, RMB)            165    174    168    168    172
Revenue per Available Room (RevPAR, RMB) 138    157    141    144    152

  oThe year-over-year decrease in RevPAR was mainly driven by continued
    market softness across China despite signs of improvements in certain
    macroeconomic indicators. In addition, relatively weaker economic
    conditions in lower tier cities further hindered hotels' normal ramp up
    progress towards maturity. This short-term set back does not change the
    Company's conviction in its strategic positioning in lower tier cities
    where long term growth prospects exist.
  oThe year-over-year decrease in RevPAR for the full year of 2012 was also
    attributable to the full year dilutive impact from Motel 168 in 2012 with
    a lower overall RevPAR than the core organic business as integration
    continues.
  oBenefiting from continued integration efforts, both occupancy rate and ADR
    for Motel 168 for the fourth quarter of 2012 improved, to 77.4% and RMB
    160 from 73.5% and RMB 154, respectively, resulting in a 9.7% improvements
    year-over-year in fourth quarter RevPAR to reach RMB 124 from RMB 113 a
    year ago. RevPAR for Motel 168 for the full year of 2012 was RMB 125. The
    integration of Motel 168 remains on track and further improvements in
    RevPAR are expected in 2013 as the integration proceeds in final stages.

"Given sustained market challenges and increasing competition, we are
reasonably pleased with our overall performance," said Mr. David Sun, the
Company's chief executive officer. "We met our annual revenue expectations and
exceeded our target for new hotel openings. Performance of mature hotels
remained solid relative to market softness, the integration of Motel 168
continues to be on track, and we have finalized the Yitel brand design and
financial blueprint."

"Our growth focus on low-capital-high-margin franchise-and-managed hotels is
well supported by our strong brand, our well-run franchise programs and the
increasing demand from our quality franchisee partners. We plan to conclude
Motel 168 integration this year, and this second economy brand will then start
to contribute positively to our bottom line. The impressive development trends
of Yitel hotels in operations have proven concept and execution model, and we
expect to scale up the Yitel portfolio accordingly," Mr. Sun continued.
"Meaningful improvements may still be months ahead, and the Company is focused
on sustainable profitable growth for the long run. We have built solid
internal readiness including strong franchised-and-managed hotels growth
momentum and continued cost control initiatives to take advantage of market
recoveries when time comes and to capture long-term growth prospects of the
Chinese economy."

Detailed Overview of Financial Results for Fourth Quarter and Full Year 2012

Total Revenues
                                       Fourth Quarter 2012 Full Year 2012
(RMB/USD in Millions)                  RMB     USD   V%    RMB     USD   V%
 Leased-and-Operated Hotels         1,305.0 209.5 10.5% 5,164.8 829.0 45.1%
 Franchised-and-Managed Hotels      160.7   25.8  24.8% 604.9   97.1  51.2%
Total Revenues                         1,465.7 235.3 11.9% 5,769.7 926.1 45.7%
Less: Business Taxes and related       -90.1   -14.5 10.9% -353.4  -56.7 41.8%
surcharges
Net Revenues                           1,375.5 220.8 12.0% 5,416.3 869.4 46.0%

  oBoth year-over-year increases in total revenues from leased-and-operated
    hotels for the fourth quarter of 2012 and the full year of 2012 were
    mainly driven by an increase in the number of hotels in operation
    offsetting impact from market-driven decrease in RevPAR. The increase in
    the number of leased-and-operated hotels in operation for the full year
    was attributable in large part to acquisition of Motel 168 effective
    October 1, 2011.
  oBoth year-over-year increases in total revenues from
    franchised-and-managed hotels for the fourth quarter of 2012 and the full
    year of 2012 were mainly driven by an increase in the number of such
    hotels in operation. The increase in the number of franchised-and-managed
    hotels in operation for the full year was attributable in large part to
    acquisition of Motel 168 effective October 1, 2011.
  oRevenues from Motel 168 included in total revenues were RMB 365.0 million
    (US$58.6 million) for the fourth quarter of 2012 and RMB 1.47 billion
    (US$235.7 million) for the full year of 2012. Revenues of Motel 168 fell
    slightly below its previous revenue guidance for the full year 2012 as a
    result of overall market weakness and significant elimination of
    unprofitable food and beverage business operations. Integration of Motel
    168 remains on track and the Company expect to conclude the integration in
    2013.

Total Operating Costs and Expenses / Total Operating Income

                                                                   Fourth Quarter 2012
                                                                                          Share-Based  Integration     Adjusted
(RMB/USDinMillions GAAP Results           Compensation Costs           Non-GAAP Results
Vpts - change in %pts of total revenues)                           RMB     USD   Vpts RMB    USD   RMB USD RMB     USD   Vpts
Leased-and-Operated Hotel Costs                                    1,208.8 194.0 1.0pts   -2.0   -0.3  -19.9   -3.2    1,186.9 190.5 0.8pts
Franchised-and-Managed Hotel Personnel Costs                       24.6    3.9   0.1pts   -2.5   -0.4  -       -       22.1    3.5   0.1pts
Sales and Marketing Expenses                                       24.8    4.0   0.2pts   -0.4   -0.1  -       -       24.4    3.9   0.2pts
General and Administrative Expenses                                83.4    13.4  -1.1pts  -17.6  -2.8  -0.6    -0.1    65.2    10.5  -0.3pts
Total Operating Costs and Expenses                                 1,341.6 215.3 0.3pts   -22.5  -3.6  -20.5   -3.3    1,298.6 208.4 0.8pts
Total Operating Income                                             36.3    5.8   -        -22.5  -3.6  -20.5   -3.3    79.2    12.7  -0.6pts
                                                                   Full Year 2012
                                                                                          Share-Based  Integration     Adjusted
(RMB/USD in Millions                                               GAAP Results           Compensation Costs           Non-GAAP Results
Vpts - change in %pts of total revenues)                           RMB     USD   Vpts     RMB    USD   RMB     USD     RMB     USD   Vpts
Leased-and-Operated Hotel Costs                                    4,642.0 745.1 5.7pts   -8.2   -1.3  -83.7   -13.4   4,550.1 730.3 4.5pts
Franchised-and-Managed Hotel Personnel Costs                       125.0   20.1  0.3pts   -9.6   -1.5  -       -       115.5   18.5  0.3pts
Sales and Marketing Expenses                                       76.9    12.3  0.2pts   -1.5   -0.2  -0.1    -       75.3    12.1  0.2pts
General and Administrative Expenses                                315.2   50.6  -3.0pts  -74.1  -11.9 -13.2   -2.1    228.0   36.6  -1.0pts
Total Operating Costs and Expenses                                 5,159.1 828.1 3.2pts   -93.4  -15.0 -97.0   -15.6   4,968.8 797.6 4.0pts
Other Income                                                       16.6    2.7   n/a                                   16.6    2.7   n/a
Total Operating Income                                             273.7   43.9  -2.8pts  -93.4  -15.0 -97.0   -15.6   464.1   74.5  -3.5pts

Total operating costs and expenses were RMB 1.34 billion (US$215.3 million)
for the fourth quarter of 2012, representing 91.5% of total revenues for the
quarter, and RMB 5.16 billion (US$ 828.1 million) for the full year of 2012,
representing 89.4% of total revenues for the year. Total operating costs and
expenses excluding any share-based compensation expenses and acquisition and
integration costs, (non-GAAP) for the fourth quarter of 2012 were 88.6% of
total revenues, compared to 87.8% in the same period a year ago, and 86.1% for
the full year of 2012 compared to 82.2% for the full year of 2011.

Both year-over-year increases in total operating costs and expenses as a
percentage of total revenues for the fourth quarter and the full year of 2012
were mainly due to overall soft market conditions, lack of systematic price
increases and rising operating costs net of productivity benefits from general
and administrative cost. The increase in this ratio for the full year was also
due to a higher cost ratio from Motel 168 with one quarter of results
consolidated in 2011 compared to four quarters of results consolidated in
2012.

  oTotal leased-and-operated hotel costs were RMB 1.21 billion (US$194.0
    million) for the fourth quarter of 2012 and RMB 4.64 billion (US$745.1
    million) for the full year of 2012. Total leased-and-operated hotel costs
    excluding any share-based compensation expenses and acquisition and
    integration costs (non-GAAP) were 91.0% of the leased-and-operated hotel
    revenue in the fourth quarter of 2012 compared to 88.9% in the same period
    a year ago, and 88.1% for the full year of 2012 compared to 82.7% for the
    full year of 2011. The year-over-year increases in this expense ratio were
    mainly due to weaker revenue base driven by market softness, the absence
    of systematic price increases, and rising operating costs including energy
    costs and personnel costs not fully absorbed by productivity initiatives.
    The year-over-year increase in this expense ratio for the full year was
    also driven by a higher cost ratio from Motel 168 hotels whose results
    were consolidated starting fourth quarter of 2011.

    Pre-opening cost was RMB 26.8 million (US$4.3 million) for the fourth
    quarter of 2012 and RMB 104.2 million (US$16.7 million) for the full year
    of 2012.
  oPersonnel costs of franchised-and-managed hotels were RMB 24.6 million
    (US$3.9 million) for the fourth quarter of 2012 and RMB 125.0 million
    (US$20.1 million) for the full year of 2012. Personnel costs of
    franchised-and-managed hotels excluding share-based compensation expenses
    (non-GAAP) were 13.8% of franchised-and-managed hotel revenues in the
    fourth quarter of 2012, compared to 14.3% in the same period of 2011, and
    19.1% for the full year of 2012 compared to 17.2% for the full year of
    2011. The decrease in this expense ratio in the fourth quarter of 2012 was
    due to one-time adjustment in the fourth quarter of 2012. The
    year-over-year increase in this ratio was mainly due to relatively lower
    revenue performance by franchised-and-managed hotels at Motel 168 whose
    results were consolidated for the full year of 2012 and only the fourth
    quarter for the full year of 2011.
  oSales and marketing expenses were RMB 24.8 million (US$4.0 million) for
    the fourth quarter of 2012, and 76.9 million (US$12.3 million) for the
    full year of 2012. Sales and marketing expenses excluding share-based
    compensation expenses (non-GAAP) were 1.7% of total revenues for the
    fourth of quarter 2012 compared to 1.5% in the same period of 2011, and
    1.3% of total revenues for the full year of 2012 compared to 1.1% of total
    revenues in 2011. The year-over-year increase in this sales and marketing
    expenses as a percentage of total revenues for the fourth quarter was
    mainly due to non-recurring spending on marketing programs in the fourth
    quarter in support of Home Inns Group's multi-brand strategy. The sales
    and marketing expense ratio was 1.3% in the full year of 2011 after taking
    into consideration of the one-time catch-up adjustment resulted from the
    adoption of an estimated redemption rate for customer rewards during 2011.
    The Company continued to rely largely on basic and cost-effective sales
    and market practices in supporting its revenue growth.
  oGeneral and administrative expenses were RMB 83.4 million (US$13.4
    million) for the fourth quarter of 2012, and RMB 315.2 million (US$50.6
    million) for the full year of 2012. General and administrative expenses
    excluding any share-based compensation expenses, acquisition and
    integration costs (non-GAAP) were 4.5% of total revenues for the quarter
    compared to 4.7% in the same period of 2012, and 4.0% of total revenue for
    the full year of 2012 compared to 5.0% for the full year of 2011. Both
    year-over-year decreases in general and administrative expenses as a
    percentage of total revenues in the fourth quarter and full year 2012 came
    as a result of effective cost control and productivity enhancements. The
    Company continued to benefit from cost discipline and economies of scale.

Income from Operations was RMB 36.3 million (US$5.8 million) for the fourth
quarter of 2012 and RMB 273.7 million (US$43.9 million) for the full year of
2012. Income from operations excluding share-based compensation expenses and
integration cost (non-GAAP) for the fourth quarter of 2012 was RMB 79.2
million (US$12.7 million), or 5.4% of total revenues, compared to RMB 78.5
million, or 6.0% of total revenues, in the same period of 2011. Income from
operations excluding share-based compensation expenses and integration cost
(non-GAAP) for 2012 was RMB 464.1 million (US$74.5 million), or 8.0% of total
revenues, compared to RMB 457.3 million, or 11.5% of total revenues, in 2011.

The year-over-year decrease in income from operations as a percentage of total
revenue for the fourth quarter of 2012 and full year of 2012 was mainly due to
weaker operating environment, and the absence of systematic price increases to
offset rising hotel operating costs including utilities and personnel related
costs. Consolidation of Motel 168 for the full year of 2012 with higher cost
ratio as the business was still in the process of integration also contributed
to the year over year decrease in the income ratio.

Provided that the market condition improves in the future, the Company is
prepared to improve profitability through pricing, higher-mix of margin-rich
franchise-and-managed hotels expansion focus, further productivity gains and
headquarter costs leverage.

EBITDA (non-GAAP)
(RMB/USDinMillions)      Fourth Quarter   Full Year 2012
                                                                               2012
(%Rev-% of Total Revenues)                                                     RMB   USD  %Rev  RMB     USD   %Rev
EBITDA (Non-GAAP)                                                              188.2 30.2 12.8% 849.5   136.4 14.7%
 Net Foreign Exchange Gain/Loss                                             -15.0 -2.4 -1.0% -0.2    -0.0  -0.0%
 Share-Based Compensation Expenses                                          22.5  3.6  1.5%  93.4    15.0  6.4%
 Integration Cost                                                           20.5  3.3  1.4%  97.0    15.5  6.6%
 Non-Operating Income/Expenses                                              -1.0  -0.2 -0.1% 6.7     1.1   0.5%
 Gain/Loss on Fair Value Change in Convertible Notes                        45.4  7.3  3.1%  87.1    14.0  5.9%
Adjusted EBITDA (Non-GAAP)                                                     260.5 41.8 17.8% 1,133.4 181.9 19.6%
Consolidated Net Income Attributable to Home Inns Group's Shareholders
(RMB/USDinMillions) Fourth Quarter   Full Year 2012
                                                                               2012
(%Rev-% of Total Revenues)                                                     RMB   USD  %Rev  RMB     USD   %Rev
Net Income (GAAP)                                                              6.3   1.0  0.4%  -26.8   -4.3  -0.5%
 Net Foreign Exchange Gain/Loss                                             -15.0 -2.4 -1.0% -0.2    -0.0  -0.0%
 Share-Based Compensation Expenses                                          22.5  3.6  1.5%  93.4    15.0  1.6%
 Integration Cost                                                           20.5  3.3  1.4%  97.0    15.6  1.7%
 Amortization of Upfront Fees on Term Loan                                  2.0   0.3  0.1%  43.3    6.9   0.7%
 Non-Operating Income/Expenses                                              -1.0  -0.2 -0.1% 6.7     1.1   0.1%
 Gain/Loss on Fair Value Change in Convertible Notes                        45.4  7.3  3.1%  87.1    14.0  1.5%
Adjusted Net Income (Non-GAAP)                                                 80.6  12.9 5.5%  300.3   48.2  5.2%
Basic and Diluted Earnings Per Ordinary Share and Per ADS
                                                                               Fourth Quarter 2012      Full Year 2012
                                                                               Ordinary   ADS Share     Ordinary      ADS Share
                                                                               Share                    Share
                                                                               RMB   USD  RMB   USD     RMB   USD RMB USD
Basic                                                                          0.07  0.01 0.14  0.02    -0.29 -0.05   -0.59   -0.09
Diluted                                                                        0.07  0.01 0.14  0.02    -0.29 -0.05   -0.59   -0.09
Adjusted Basic (Non-GAAP)                                                      0.89  0.14 1.77  0.28    3.31  0.53    6.62    1.06
Adjusted Diluted (Non-GAAP)                                                    0.87  0.14 1.74  0.28    3.31  0.53    6.62    1.06

Cash Flow

Net operating cash flow for the fourth quarter of 2012 was RMB 186.8 million
(US$30.0 million), compared to RMB 139.5 million in the same period of 2011.
Capitalized expenditures for the fourth quarter of 2012 were RMB 250.4 million
(US$40.2 million), while related cash paid for capital expenditures during the
quarter was RMB 305.6 million (US$49.0 million).

For the full year 2012, net operating cash flow was RMB 716.9 million
(US$115.1 million), compared to RMB 726.1 million in 2011. Capitalized
expenditures for 2012 were RMB 1.00 billion (US$160.9 million), while related
cash paid for capital expenditures during the year was RMB 958.1 million
(US$153.8 million).

Balance Sheet

As of December 31, 2012, Home Inns Group had cash and cash equivalents of RMB
663.2 million (US$106.4 million). Financial liabilities of RMB 1.07 billion
(US$171.2 million) consisted of the outstanding balance of long-term financial
liability for convertible notes (issued in December 2010) and interest swap
contracts (both measured at fair value). The balance of the Company's U.S.
dollar-denominated four-year term loan facility was RMB 748.0 million
(US$120.1 million). The Company redeemed the outstanding convertible bonds
issued in 2007 in the fourth quarter of 2012.

The Company plans to execute its future expansions with more
franchised-and-managed hotels which do not require capital investments. The
number of new lease-and-operated hotels openings will be reduced accordingly.
With a strong underlying cash-generative hotel operations, the Company expects
to improve its cash position in the near future.

Outlook for First Quarter and Full Year 2013

Home Inns Group targets to open 360 to 380 new hotels in 2013, including
approximately 80 to 90 leased-and-operated hotels and 270 to 300
franchised-and-managed hotels.

Home Inns Group expects total revenues for the group for 2013 to be in the
range of RMB 6,600 million (US$1,059.4 million) to RMB 6,800 million
(US$1,091.5 million), representing a growth of 14.4% to 17.9% over 2012. Total
revenues for the group in the first quarter of 2013 are expected to be in the
range of RMB 1,385 million (US$222.3 million) to RMB 1,415 million (US$227.1
million).

Total revenues for Motel 168 brand for 2013 are expected to be in the range of
RMB 1,650 million (US$264.8 million) to RMB 1,700 million (US$272.9 million).
Total revenues for Motel 168 brand in the first quarter of 2013 are expected
to be in the range of RMB 330 million (US$53.0 million) to RMB 340 million
(US$54.6 million).

Excluding Motel 168, total revenues for 2013 are expected to be in the range
of RMB 4,950 million (US$794.5 million) to RMB 5,100 million (US$818.6
million). Excluding Motel 168, total revenues in the first quarter of 2013 are
expected to be in the range of RMB 1,055 million (US$169.3 million) to RMB
1,075 million (US$172.5 million).

These forecasts reflect the Company's current and preliminary view, which are
subject to change.

This announcement contains translations of certain RMB amounts into U.S.
dollars solely for the convenience of the reader. Unless otherwise noted, all
translations from RMB to U.S. dollars are made at a rate of RMB 6.2301 to
US$1.00, the noon buying rate for December 31, 2012 set forth in the H.10
statistical release of the Federal Reserve Board.

Conference Call Information

Management will hold an earnings conference call at 9 PM U.S. Eastern Daylight
Time on Monday, March 11, 2013 (9 AM Beijing/Hong Kong Time on Tuesday, March
12, 2013).

Dial-in details for the earnings conference call are as follows:

U.S. (toll free):          1.866.519.4004
U.S.:                      1.718.354.1231
China Mainland:            800.819.0121 or 400.620.8038
Hong Kong (toll free):     800.930.346
Hong Kong:                 852.2475.0994
U.K. (toll free):          080.8234.6646
U.K.:                      44.2030.598.139
Australia (toll free):     1.800.457.076
Taiwan (toll free):        008.0112.6920
International:             65.6723.9381
Pass code for all regions: Home Inns

A replay of the conference call may be accessed by phone at the following
numbers until the end of Monday, March 18, 2013 U.S. Eastern Daylight Time.

U.S. toll free:       1.855.452.5696
China toll free:      400.120.0932 or 800.870.0205
Hong Kong toll free:  800.963.117
International:        61.2.8199.0299
Conference ID number: 96051138

Live and archived webcasts of this conference call will be available at
http://english.homeinns.com.

About Home Inns Group

Home Inns Group is a leading economy hotel chain in China based on the number
of hotels and hotel rooms, as well as the geographic coverage of the hotel
chain. Since the Company commenced operations in 2002, it has built Home Inn
as one of the best-known economy hotel brands in China. In October of 2011,
Home Inns Group acquired Motel 168, another well-known hotel chain in China,
as its second economy hotel brand. Home Inns Group aims to offer a consistent
product and high-quality services to primarily serve the fast growing
population of value-conscious individual business and leisure travelers who
demand clean, comfortable and convenient lodging. Home Inns Group's ADSs, each
of which represents two ordinary shares, are currently trading on the NASDAQ
Global Select Market under the symbol "HMIN." For more information about Home
Inns Group, please visit http://english.homeinns.com.

Safe Harbor

This announcement contains forward-looking statements. These 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," "anticipates," "future,"
"intends," "plans," "believes," "estimates" and similar statements. Any
statements in this press release that are not historical facts are
forward-looking statements that involve factors, risks and uncertainties that
could cause actual results to differ materially from those in the
forward-looking statements. Such factors and risks include our anticipated
growth strategies; our future results of operations and financial condition;
the economic conditions of China; the regulatory environment in China; our
ability to attract customers and leverage our brand; trends and competition in
the lodging industry; the expected growth of the lodging market in China; our
expected successful consolidation and integration of Motel 168 with our
existing operations; and other factors and risks detailed in our filings with
the Securities and Exchange Commission. This press release also contains
statements or projections that are based upon information available to the
public, as well as other information from sources which management believes to
be reliable, but it is not guaranteed by us to be accurate, nor does it
purport to be complete. We undertake no obligation to update or revise to the
public any forward-looking statements, whether as a result of new information,
future events or otherwise, unless required by applicable law.

Non-GAAP Financial Measures

To supplement Home Inns Group's unaudited consolidated financial results
presented in accordance with U.S. GAAP, Home Inns Group uses the following
non-GAAP measures:

(a) total operating costs and expenses excluding share-based compensation
expenses and acquisition and integration costs

(b) total leased-and-operated hotel costs excluding share-based compensation
expenses and integration costs

(c) personnel costs of franchised-and-managed hotels excluding share-based
compensation expenses

(d) sales and marketing expenses excluding share-based compensation expenses

(e) general and administrative expenses excluding share-based compensation
expenses and acquisition and integration costs

(f) income from operations excluding share-based compensation expenses and
acquisition and integration costs

(g) adjusted net income attributable to shareholders excluding any share-based
compensation expenses, foreign exchange gain or loss, acquisition and
integration cost, upfront fee amortization of term loan, gain or loss from
fair value change of convertible notes and interest swap derivatives,
withholding tax for profit distribution of previous periods and other
non-operating expenses

(h) adjusted basic and diluted earnings per ADS and per share excluding
foreign exchange gain or loss, share-based compensation expenses, gain on
buy-back of convertible bonds, issuance costs for convertible notes, gain or
loss from fair value change of convertible notes, acquisition and integration
cost, withholding tax for profit distribution of previous periods,
non-operating expenses and upfront fee amortization of term loan, and

(i) adjusted EBITDA excluding foreign exchange gain or loss, share-based
compensation expenses, gain on buy-back of convertible bonds, issuance costs
for convertible notes, gain or loss from fair value change of convertible
notes, acquisition and integration costs, non-operating expenses and upfront
fee amortization of term loan

Any financial data referring to "Excluding Motel 168" are also non-GAAP
financial measures. The presentation of these non-GAAP financial measures is
not intended to be considered in isolation or as a substitute for the
financial information prepared and presented in accordance with U.S. GAAP. For
more information on these non-GAAP financial measures, please see the table
captioned "Reconciliations of GAAP and non-GAAP results" set forth at the end
of this press release.

Home Inns Group believes that, used in conjunction with GAAP financial
measures, these non-GAAP financial measures provide meaningful supplemental
information regarding the Group's performance, and both management and
investors benefit from referring to these non-GAAP financial measures in
assessing the Group's performance and when planning and forecasting future
periods. Management believes that EBITDA, defined as earnings before interest,
income tax expense, depreciation and amortization, is a useful financial
metric to assess Home Inns Group's operating and financial performance before
the impact of investing and financing transactions and income taxes. In
addition, management believes that EBITDA is widely used by other companies in
the lodging industry and may be used as an analysis tool by both management
and investors to measure and compare Home Inns Group's operational and
financial performance with industry peers.

One of the limitations of using non-GAAP income from operations, EBITDA,
adjusted EBITDA and non-GAAP net income attributable to shareholders is that
they do not include all items that impact Home Inns Group's net income (loss)
for the period. These non-GAAP measures exclude share-based compensation
expenses, foreign exchange gain or loss and gain or loss from fair value
change of convertible notes, which have been and will continue to be a
significant recurring expense in Home Inns Group's business. In addition, Home
Inns Group's EBITDA and adjusted EBITDA may not be comparable to EBITDA or
similarly titled measures utilized by other companies since such other
companies may not calculate EBITDA in the same manner as Home Inns Group does.
Management compensates for this and other limitations by providing specific
information regarding the GAAP amounts excluded from each non-GAAP measure.
Home Inns Group computes the non-GAAP financial measures using the same
consistent method from quarter to quarter. Reconciliations of GAAP and
non-GAAP results are included at the end of this press release. The non-GAAP
adjustment items do not include the tax impact.

The presentation of EBITDA and adjusted EBITDA should not be construed as an
indication that Home Inns Group's future results will be unaffected by other
charges and gains Home Inns Group considers to be outside the ordinary course
of its business.

Home Inns Group completed its acquisition of 100% equity interest in Motel
168, and took control of Motel 168 effective on October 1, 2011. Home Inns
Group has consolidated Motel 168's operating and financial results since
October 1, 2011. Home Inns Group has presented certain separated financial
data of Motel 168 in this earning release for the purpose of providing more
information to investors. Home Inns Group will provide separate financial data
for Motel 168 through the integration period.

For investor and media inquiries, please contact:

Johnny Wang
Home Inns & Hotels Management Inc.
Tel: +86-21-3401-9898*2504
Email: johnnywang@homeinns.com

Cara O'Brien
FTI Consulting
Tel: +852-3768-4537
Email: cara.obrien@fticonsulting.com

Appendix 1:

For the purpose of providing more context and comprehensive information to
investors, Home Inns Group separately presents key financial data excluding
Motel 168 below. Home Inns Group will continue to provide separate financial
data for Motel 168 through the integration period. All information outlined
below excludes Motel 168 results and Motel 168 integration costs unless
specifically mentioned.

Fourth Quarter and Full Year 2012 Operational and Financial Highlights for Home Inns and Yitel Hotels
OperatingMetrics
                                                               4Q12          3Q12     4Q11             FY12  FY11
Occupancy Rate                                                 85.6%         92.7%    88.4%            88.7% 90.3%
Average Daily rate (ADR RMB)                                   166           177      173              170   173
Revenue per Available Room (RevPAR RMB)                        143           164      153              151   156
Total Revenues                                                 4Q12                   FY12
(Millions)                                                     RMB     USD   V%       RMB     USD      V%
Total Revenues                                                 1,100.6 176.7 16.8%    4,301.2 690.4    19.7%
Leased-and-Operated Hotels                                     959.7   154.0 15.7%    3,767.1 604.7    17.4%
Franchised-and-Managed Hotels                                  140.9   22.6  25.3%    534.1   85.7     39.2%
Total Operating Costs and Expenses
                                                               Fourth Quarter 2012
(Millions)                                                     GAAP Results           Share-based      Integration Non-GAAP Results
                                                                                      Comp.
(Vpts – change in %pts of total revenue)                       RMB     USD   Vpts RMB     USD      RMB   USD   RMB     USD   Vpts
Leased-and-Operated Hotel Costs                                843.9   135.5 1.4pts   -1.8    -0.3     -0.1  -0.02 842.0   135.1 1.4pts
Franchised-and-Managed Hotel Personnel Costs                   20.8    3.3   0.0pts   -2.2    -0.4     -     -     18.7    3.0   0.0pts
Sales and Marketing Expenses                                   21.0    3.4   0.2pts   -0.4    -0.06    -     -     20.7    3.3   0.2pts
General and Administrative Expenses                            73.6    11.8  -1.3pts  -16.9   -2.7     -     -     56.6    9.1   -0.5pts
Total Operating Costs and Expenses                             959.3   154.0 0.3pts   -21.3   -3.4     -0.1  -     937.9   150.5 1.1pts
                                                               Full Year 2012
(Millions)                                                     GAAP Results           Share-based      Integration Non-GAAP Results
                                                                                      Comp.
(Vpts – change in %pts of total revenues)                      RMB     USD   Vpts     RMB     USD      RMB   USD   RMB     USD   Vpts
Leased-and-Operated Hotel Costs                                3,218.8 516.7 2.3pts   -7.2    -1.2     -7.8  -1.3  3,203.7 514.2 2.1pts
Franchised-and-Managed Hotel Personnel Costs                   103.7   16.6  0.5pts   -8.4    -1.4     -     -     95.3    15.3  0.4pts
Sales and Marketing Expenses                                   65.6    10.5  0.4pts   -1.5    -0.2     -     -     64.0    10.3  0.4pts
General and Administrative Expenses                            264.1   42.4  -2.8pts  -71.9   -11.5    -     -     192.2   30.9  -0.8pts
Total Operating Costs and Expenses                             3,652.2 586.2 0.4pts   -89.1   -14.3    -7.8  -1.3  3,555.3 570.7 2.0pts
Profitability                                                  Fourth Quarter 2012
(Millions)                                                     GAAP Results                   Reconciliation       Non-GAAP Results
(Vpts - change in %pts of total revenues)                      RMB     USD   Vpts             RMB      USD         RMB     USD   Vpts
Income from Operations                                         74.6    12.0  1.2pts           21.4     3.4         96.0    15.4  0.7pts
Net Income                                                     4.4     0.7   -4.9pts          53.3     8.6         57.7    9.3   2.4pts
EBITDA (Non-GAAP)                                              183.0   29.4  -2.7pts          51.3     8.2         234.3   37.6  4.9pts
                                                               Full Year 2012
(Millions)                                                     GAAP Results                   Reconciliation       Non-GAAP Results
(Vpts - change in %pts of total revenues)                      RMB     USD   Vpts             RMB      USD         RMB     USD   Vpts
Income from Operations                                         397.6   63.8  1.9pts           1.0      0.2         494.5   79.4  0.7pts
Net Income                                                     58.4    9.4   -8.6pts          233.3    37.4        291.7   46.8  -0.9pts
EBITDA (Non-GAAP)                                              794.3   127.5 -3.7pts          190.0    30.5        984.3   158.0 3.4pts



Home Inns & Hotels Management Inc.
Unaudited Condensed Consolidated Balance Sheet
                                December31,2011      December 31, 2012
                                RMB '000               RMB '000     US$ '000
ASSETS
Current assets:
Cash and cash equivalents       1,786,038              663,156      106,444
Restricted cash                 205,926                205,739      33,023
Accounts receivable, net        91,980                 98,176       15,758
Receivables from related        6,379                  6,818        1,094
parties
Consumables                     43,049                 41,600       6,677
Prepayments and other           137,887                172,534      27,694
current assets
Deferred tax assets             75,446                 80,369       12,900
Total current assets            2,346,705              1,268,392    203,590
Investment in a jointly         8,301                  6,625        1,063
controlled entity
Property and equipment,         3,452,846              3,846,835    617,460
net
Goodwill                        2,197,728              2,254,631    361,893
Intangible assets, net          1,174,452              1,149,419    184,494
Other assets                    170,039                117,350      18,836
Non-current deferred tax        199,765                310,762      49,881
assets
Total assets                    9,549,836              8,954,014    1,437,217
LIABILITIES
Current liabilities:
Accounts payable                91,457                 76,825       12,331
Payables to related             2,797                  3,798        610
parties
Short term loans                346,550                12,571       2,018
Finance lease liabilities       7,006                  6,660        1,069
Salaries and welfare            178,032                215,569      34,601
payable
Income tax payable              80,356                 76,382       12,260
Other taxes payable             27,295                 27,761       4,456
Deferred revenues               202,870                202,874      32,564
Convertible bonds               113,051                -            -
Other unpaid and accruals       154,498                165,886      26,624
Other payables                  847,090                925,134      148,494
Deferred tax liability          38,313                 29,439       4,725
Total current liabilities       2,089,315              1,742,899    279,752
Long term loans                 1,165,666              735,404      118,040
Deferred rental                 593,955                631,618      101,382
Deferred revenues               79,202                 45,089       7,237
Finance lease liabilities       7,750                  1,620        260
Deposits                        63,472                 91,462       14,681
Other long term payables        -                      10,620       1,705
Unfavorable lease               396,774                370,548      59,477
liabilities
Financial liabilities*          979,008                1,066,771    171,229
Deferred tax liabilities        294,728                288,321      46,279
Total liabilities               5,669,870              4,984,352    800,042
Commitments and
contingencies
Shareholders' equity
Ordinary shares (US$0.005
par value;
200,000,000 shares
authorized, 90,659,882
and 91,672,320 shares           3,542                  3,574        574
issued and
outstanding as of December
31, 2011 and
December 31 2012,
respectively)
Additional paid-in capital      2,683,923              2,802,905    449,897
Statutory reserves              125,863                158,417      25,428
Retained earnings               1,051,976              992,505      159,308
Total Home Inns                 3,865,304              3,957,401    635,207
shareholders' equity
Noncontrolling interests        14,662                 12,261       1,968
Total shareholders' equity      3,879,966              3,969,662    637,175
Total liabilities and           9,549,836              8,954,014    1,437,217
shareholders' equity
                                -                      -            -
Note 1: The conversion of Renminbi ("RMB") into United States dollars ("US$")
is based on rate of US$1.00=RMB6.2301
on December 31, 2012, representing the certificated exchange rate published by
the Federal Reserve Board.
Note 2:Financial liabilities represent convertible notes measured at fair
value and interest swap transaction.



Home Inns & Hotels Management Inc.
Unaudited Condensed Consolidated Statement of Operations
                                                                                          Quarter Ended                                                                                                       Year Ended
                                                                                          December 31, 2011                  September 30, 2012                 December 31, 2012                             December 31, 2011                    December 31, 2012
                                                                                          RMB '000     RMB '000   RMB '000   RMB '000     RMB '000   RMB '000   RMB '000     US$ '000   RMB '000   RMB '000   RMB '000     RMB '000   RMB '000     RMB '000     US$ '000   RMB '000     RMB '000
                                                                                          Group        Motel 168  excluding  Group        Motel 168  excluding  Group        Group      Motel 168  excluding  Group        Motel 168  excluding    Group        Group      Motel 168    excluding
                                                                                                                  Motel 168                          Motel 168                                     Motel 168                          Motel 168                                         Motel 168
Revenues:
Leased-and-operated hotels                                                                1,181,157    351,380    829,777    1,431,786    381,068    1,050,718  1,304,958    209,460    345,233    959,725    3,559,740    351,380    3,208,360    5,164,799    829,007    1,397,734    3,767,065
Franchised-and-managed hotels                                                             128,743      16,243     112,500    166,624      17,797     148,827    160,724      25,798     19,812     140,912    399,986      16,243     383,743      604,936      97,099     70,832       534,104
Total revenues                                                                            1,309,900    367,623    942,277    1,598,410    398,865    1,199,545  1,465,682    235,258    365,045    1,100,637  3,959,726    367,623    3,592,103    5,769,735    926,106    1,468,566    4,301,169
Less: Business tax and related surcharges                                                 (81,307)     (21,258)   (60,049)   (97,003)     (23,683)   (73,320)   (90,149)     (14,470)   (21,370)   (68,779)   (249,274)    (21,258)   (228,016)    (353,418)    (56,728)   (87,218)     (266,200)
Net revenues                                                                              1,228,593    346,365    882,228    1,501,407    375,182    1,126,225  1,375,533    220,788    343,675    1,031,858  3,710,452    346,365    3,364,087    5,416,317    869,378    1,381,348    4,034,969
Operating costs and expenses:
Leased-and-operated hotel costs –
Rents and utilities                                                                       (452,605)    (160,964)  (291,641)  (496,559)    (165,845)  (330,714)  (514,213)    (82,537)   (158,565)  (355,648)  (1,232,662)  (160,964)  (1,071,698)  (1,953,243)  (313,517)  (631,320)    (1,321,923)
Personnel costs                                                                           (224,501)    (65,606)   (158,895)  (269,260)    (76,527)   (192,733)  (245,909)    (39,471)   (67,833)   (178,076)  (657,155)    (65,606)   (591,549)    (1,037,371)  (166,510)  (296,889)    (740,482)
Depreciation and amortization                                                             (139,023)    (46,012)   (93,011)   (156,294)    (41,830)   (114,464)  (158,078)    (25,373)   (39,707)   (118,371)  (398,914)    (46,012)   (352,902)    (612,789)    (98,359)   (169,482)    (443,307)
Consumables, food and beverage                                                            (104,687)    (40,518)   (64,169)   (96,555)     (25,258)   (71,297)   (99,834)     (16,024)   (28,013)   (71,821)   (258,120)    (40,518)   (217,602)    (351,338)    (56,394)   (94,911)     (256,427)
Others                                                                                    (145,826)    (43,783)   (102,043)  (195,247)    (58,254)   (136,993)  (190,804)    (30,626)   (70,846)   (119,958)  (413,815)    (43,783)   (370,032)    (687,254)    (110,312)  (230,597)    (456,657)
Total leased-and-operated hotel costs                                                     (1,066,642)  (356,883)  (709,759)  (1,213,915)  (367,715)  (846,200)  (1,208,838)  (194,031)  (364,964)  (843,874)  (2,960,666)  (356,883)  (2,603,783)  (4,641,995)  (745,092)  (1,423,199)  (3,218,796)
Personnel costs of Franchised-and-managed                                                 (20,083)     (2,335)    (17,748)   (45,046)     (7,894)    (37,152)   (24,581)     (3,946)    (3,746)    (20,835)   (72,009)     (2,335)    (69,674)     (125,031)    (20,069)   (21,303)     (103,728)
hotels
Sales and marketing expenses                                                              (19,574)     (3,557)    (16,017)   (18,351)     (2,405)    (15,946)   (24,793)     (3,980)    (3,785)    (21,008)   (44,451)     (3,557)    (40,894)     (76,878)     (12,340)   (11,317)     (65,561)
General and administrative expenses                                                       (89,088)     (13,858)   (75,230)   (77,850)     (9,221)    (68,629)   (83,408)     (13,388)   (9,828)    (73,580)   (335,888)    (13,858)   (322,030)    (315,235)    (50,599)   (51,145)     (264,090)
Total operating costs and expenses                                                        (1,195,387)  (376,633)  (818,754)  (1,355,162)  (387,235)  (967,927)  (1,341,620)  (215,345)  (382,323)  (959,297)  (3,413,014)  (376,633)  (3,036,381)  (5,159,139)  (828,100)  (1,506,964)  (3,652,175)
Other income                                                                              -            -          -          7,742        239        7,503      2,341        376        299        2,042      -            -          -            16,558       2,658      1,713        14,845
Income/(loss) from operations                                                             33,206       (30,268)   63,474     153,987      (11,814)   165,801    36,254       5,819      (38,349)   74,603     297,438      (30,268)   327,706      273,736      43,936     (123,903)    397,639
Interest income                                                                           11,497       1,773      9,724      615          190        425        861          138        176        685        31,996       1,773      30,223       11,874       1,906      1,001        10,873
Interest expenses                                                                         (28,313)     (630)      (27,683)   (27,182)     (177)      (27,005)   (17,393)     (2,792)    (150)      (17,243)   (46,868)     (630)      (46,238)     (119,416)    (19,168)   (758)        (118,658)
Loss from equity investment                                                               -            -          -          (466)        (467)      -          (493)        (79)       (493)      -          -            -          -            (2,305)      (370)      (2,305)      -
Gain/(loss) on change in fair value of convertible notes                                  35,966       -          35,966     (26,765)     -          (26,765)   (45,356)     (7,280)    -          (45,356)   198,547      -          198,547      (87,099)     (13,980)   -            (87,099)
Gain on buy-back of convertible bonds                                                     -            -          -          -            -          -          -            -          -          -          1,521        -          1,521        -            -          -            -
Non-operating income                                                                      4,895        2,927      1,968      11,044       2,136      8,908      19,683       3,160      2,113      17,570     35,899       2,927      32,972       47,986       7,702      6,705        41,281
Non-operating expenses                                                                    (7,315)      -          (7,315)    (7,818)      -          (7,818)    -            -          -          -          (7,315)      -          (7,315)      (11,403)     (1,830)    -            (11,403)
Foreign exchange gain/(loss), net                                                         18,495       548        17,947     (6,748)      (212)      (6,536)    14,974       2,403      595        14,379     15,849       548        15,301       217          35         (410)        627
Income/(loss) before income tax expenses and noncontrolling interests                     68,431       (25,650)   94,081     96,667       (10,344)   107,010    8,530        1,369      (36,108)   44,638     527,067      (25,650)   552,717      113,590      18,231     (119,670)    233,260
Income tax (expense)/benefit                                                              (33,815)     8,134      (41,949)   (62,255)     (4,239)    (58,016)   (964)        (155)      38,003     (38,967)   (169,442)    8,134      (177,576)    (136,305)    (21,878)   34,481       (170,786)
Net income/(loss)                                                                         34,616       (17,516)   52,132     34,412       (14,583)   48,994     7,566        1,214      1,895      5,671      357,625      (17,516)   375,141      (22,715)     (3,647)    (85,189)     62,474
Less:Net income attributable to noncontrolling interests                                  (1,957)      -          (1,957)    (703)        -          (703)      (1,286)      (206)      -          (1,286)    (6,094)      -          (6,094)      (4,061)      (652)      -            (4,061)
Net income/(loss) attributable to Home Inns Group's shareholders                          32,659       (17,516)   50,175     33,709       (14,583)   48,291     6,280        1,008      1,895      4,385      351,531      (17,516)   369,047      (26,776)     (4,299)    (85,189)     58,413
Earnings per share
- Basic                                                                                   0.36                    0.55       0.37                    0.53       0.07         0.01                  0.05       4.17                    4.38         (0.29)       (0.05)                  0.64
- Diluted                                                                                 (0.06)                  0.11       0.37                    0.52       0.07         0.01                  0.05       1.26                    1.44         (0.29)       (0.05)                  0.63
Weighted average ordinary shares outstanding
- Basic                                                                                   90,596                  90,596     90,771                  90,771     91,027       91,027                91,027     84,222                  84,222       90,805       90,805                  90,805
- Diluted                                                                                 99,672                  99,672     92,600                  92,600     92,445       92,445                92,445     94,299                  94,299       90,805       90,805                  92,222
Share-based compensation expense was included in the statement of operations as follows:
Leased-and-operated hotel costs – Personnel costs                                         1,637                   1,637      2,025        261        1,764      2,038        327        241        1,797      3,283                   3,283        8,199        1,316      963          7,236
Personnel costs of Franchised-and-managed hotels                                          1,709                   1,709      2,410        313        2,097      2,476        397        292        2,184      3,369                   3,369        9,578        1,537      1,155        8,423
Sales and marketing expenses                                                              317                     317        407          -          407        354          57         -          354        656                     656          1,535        246        -            1,535
General and administrative expenses                                                       15,831                  15,831     19,195       545        18,650     17,620       2,828      671        16,949     69,227                  69,227       74,064       11,888     2,182        71,882
Note 1: The conversion of Renminbi ("RMB") into United States dollars ("US$") is based on rate of US$1.00=RMB6.2301 on December 31, 2012, representing the certificated exchange rate published by the Federal Reserve Board.

Home Inns & Hotels
Management Inc.
Reconciliation of GAAP
and Non-GAAP Results
                        Quarter Ended December 31, 2012                                                                       Quarter Ended December 31, 2012(excluding Motel 168)
                        GAAP         %ofTotal  Share-based   Acquisition  Integration  %ofTotal  Non-GAAP     %ofTotal  GAAP         %ofTotal  Share-based   Acquisition  Integration  %ofTotal  Non-GAAP     %ofTotal
                        Result       Revenue     Compensation  expenses     cost         Revenue     Result       Revenue     Result       Revenue     Compensation  expenses     cost         Revenue     Result       Revenue
                        RMB '000                 RMB '000      RMB '000     RMB '000                 RMB '000                 RMB '000                 RMB '000      RMB '000     RMB '000                 RMB '000
                        (unaudited)              (unaudited)   (unaudited)  (unaudited)              (unaudited)              (unaudited)              (unaudited)   (unaudited)  (unaudited)              (unaudited)
Leased-and-operated     (1,208,838)  82.5%       2,038         -            19,933       1.5%        (1,186,867)  81.0%       (843,874)    76.7%       1,797         -            107          0.2%        (841,970)    76.5%
hotel costs
Personnel costs of
Franchised-and-managed  (24,581)     1.7%        2,476         -            -            0.2%        (22,105)     1.5%        (20,835)     1.9%        2,184         -            -            0.2%        (18,651)     1.7%
hotels
Sales and marketing     (24,793)     1.7%        354           -            -            0.0%        (24,439)     1.7%        (21,008)     1.9%        354           -            -            0.0%        (20,654)     1.9%
expenses
General and
administrative          (83,408)     5.7%        17,620        -            558          1.2%        (65,230)     4.5%        (73,580)     6.7%        16,949        -            -            1.5%        (56,631)     5.1%
expenses
Total operating costs   (1,341,620)  91.5%       22,488        -            20,491       2.9%        (1,298,641)  88.6%       (959,297)    87.2%       21,284        -            107          1.9%        (937,906)    85.2%
and expenses
Income from operations  36,254       2.5%        22,488        -            20,491       2.9%        79,233       5.4%        74,603       6.8%        21,284        -            107          1.9%        95,994       8.7%
                        Quarter Ended December 31, 2012                                                                       Quarter Ended December 31, 2012(excluding Motel 168)
                        GAAP         % of Total  Share-based   Acquisition  Integration  % of Total  Non-GAAP     % of Total  GAAP         %of Total   Share-based   Acquisition  Integration  % of Total  Non-GAAP     % of Total
                        Result       Revenue     Compensation  expenses     cost         Revenue     Result       Revenue     Result       Revenue     Compensation  expenses     cost         Revenue     Result       Revenue
                        US$ '000                 US$ '000      US$ '000     US$ '000                 US$ '000                 US$ '000                 US$ '000      US$ '000     US$ '000                 US$ '000
                        (unaudited)              (unaudited)   (unaudited)  (unaudited)              (unaudited)              (unaudited)              (unaudited)   (unaudited)  (unaudited)              (unaudited)
Leased-and-operated     (194,031)    82.5%       327           -            3,199        1.5%        (190,505)    81.0%       (135,451)    76.7%       288           -            17           0.2%        (135,145)    76.5%
hotel costs
Personnel costs of
Franchised-and-managed  (3,946)      1.7%        397           -            -            0.2%        (3,549)      1.5%        (3,344)      1.9%        351           -            -            0.2%        (2,994)      1.7%
hotels
Sales and marketing     (3,980)      1.7%        57            -            -            0.0%        (3,923)      1.7%        (3,372)      1.9%        57            -            -            0.0%        (3,315)      1.9%
expenses
General and
administrative          (13,388)     5.7%        2,828         -            90           1.2%        (10,470)     4.5%        (11,810)     6.7%        2,721         -            -            1.5%        (9,090)      5.1%
expenses
Total operating costs   (215,345)    91.5%       3,610         -            3,289        2.9%        (208,446)    88.6%       (153,978)    87.2%       3,416         -            17           1.9%        (150,544)    85.2%
and expenses
Income from operations  5,819        2.5%        3,610         -            3,289        2.9%        12,718       5.4%        11,975       6.8%        3,416         -            17           1.9%        15,408       8.7%
                        Quarter Ended September 30, 2012                                                                      Quarter Ended September 30, 2012(excluding Motel 168)
                        GAAP         % of Total  Share-based   Acquisition  Integration  % of Total  Non-GAAP     % of Total  GAAP         % of Total  Share-based   Acquisition  Integration  % of Total  Non-GAAP     % of Total
                        Result       Revenue     Compensation  expenses     cost         Revenue     Result       Revenue     Result       Revenue     Compensation  expenses     cost         Revenue     Result       Revenue
                        RMB '000                 RMB '000      RMB '000     RMB '000                 RMB '000                 RMB '000                 RMB '000      RMB '000     RMB '000                 RMB '000
                        (unaudited)              (unaudited)   (unaudited)  (unaudited)              (unaudited)              (unaudited)              (unaudited)   (unaudited)  (unaudited)              (unaudited)
Leased-and-operated     (1,213,915)  75.9%       2,025         -            25,406       1.7%        (1,186,484)  74.2%       (846,200)    70.5%       1,764         -            7,714        0.8%        (836,722)    69.8%
hotel costs
Personnel costs of
Franchised-and-managed  (45,046)     2.8%        2,410         -            -            0.2%        (42,636)     2.7%        (37,152)     3.1%        2,097         -            -            0.2%        (35,055)     2.9%
hotels
Sales and marketing     (18,351)     1.1%        407           -            -            0.0%        (17,944)     1.1%        (15,946)     1.3%        407           -            -            0.0%        (15,539)     1.3%
expenses
General and
administrative          (77,850)     4.9%        19,195        -            1,224        1.3%        (57,431)     3.6%        (68,629)     5.7%        18,650        -            -            1.6%        (49,979)     4.2%
expenses
Total operating costs   (1,355,162)  84.8%       24,037        -            26,630       3.2%        (1,304,495)  81.6%       (967,927)    80.7%       22,918        -            7,714        2.6%        (937,295)    78.1%
and expenses
Income from operations  153,987      9.6%        24,037        -            26,630       3.2%        204,654      12.8%       165,801      13.8%       22,918        -            7,714        2.6%        196,433      16.4%
                        Quarter Ended December 31, 2011                                                                       Quarter Ended December 31, 2011(excluding Motel 168)
                        GAAP         % of Total  Share-based   Acquisition  Integration  % of Total  Non-GAAP     % of Total  GAAP         % of Total  Share-based   Acquisition  Integration  % of Total  Non-GAAP     % of Total
                        Result       Revenue     Compensation  expenses     cost         Revenue     Result       Revenue     Result       Revenue     Compensation  expenses     cost         Revenue     Result       Revenue
                        RMB '000                 RMB '000      RMB '000     RMB '000                 RMB '000                 RMB '000                 RMB '000      RMB '000     RMB '000                 RMB '000
                        (unaudited)              (unaudited)   (unaudited)  (unaudited)              (unaudited)              (unaudited)              (unaudited)   (unaudited)  (unaudited)              (unaudited)
Leased-and-operated     (1,066,642)  81.4%       1,637         -            14,635       1.2%        (1,050,370)  80.2%       (709,759)    75.3%       1,637         -            -            0.2%        (708,122)    75.2%
hotel costs
Personnel costs of
Franchised-and-managed  (20,083)     1.5%        1,709         -            -            0.1%        (18,374)     1.4%        (17,748)     1.9%        1,709         -            -            0.2%        (16,039)     1.7%
hotels
Sales and marketing     (19,574)     1.5%        317           -            -            0.0%        (19,257)     1.5%        (16,017)     1.7%        317           -            -            0.0%        (15,700)     1.7%
expenses
General and
administrative          (89,088)     6.8%        15,831        6,295        4,870        2.1%        (62,092)     4.7%        (75,230)     8.0%        15,831        6,295        -            2.3%        (53,104)     5.6%
expenses
Total operating costs   (1,195,387)  91.3%       19,494        6,295        19,505       3.5%        (1,150,093)  87.8%       (818,754)    86.9%       19,494        6,295        -            2.7%        (792,965)    84.2%
and expenses
Income from operations  33,206       2.5%        19,494        6,295        19,505       3.5%        78,500       6.0%        63,474       6.7%        19,494        6,295        -            2.7%        89,263       9.5%
                        Year Ended December 31, 2012                                                                          Year Ended December 31, 2012(excluding Motel 168)
                        GAAP         %of Total   Share-based   Acquisition  Integration  %of Total   Non-GAAP     %of Total   GAAP         %of Total   Share-based   Acquisition  Integration  %of Total   Non-GAAP     %of Total
                        Result       Revenue     Compensation  expenses     cost         Revenue     Result       Revenue     Result       Revenue     Compensation  expenses     cost         Revenue     Result       Revenue
                        RMB '000                 RMB '000      RMB '000     RMB '000                 RMB '000                 RMB '000                 RMB '000      RMB '000     RMB '000                 RMB '000
                        (unaudited)              (unaudited)   (unaudited)  (unaudited)              (unaudited)              (unaudited)              (unaudited)   (unaudited)  (unaudited)              (unaudited)
Leased-and-operated     (4,641,995)  80.5%       8,199         -            83,744       1.6%        (4,550,052)  78.9%       (3,218,796)  74.8%       7,236         -            7,821        0.4%        (3,203,739)  74.5%
hotel costs
Personnel costs of
Franchised-and-managed  (125,031)    2.2%        9,578         -            -            0.2%        (115,453)    2.0%        (103,728)    2.4%        8,423         -            -            0.2%        (95,305)     2.2%
hotels
Sales and marketing     (76,878)     1.3%        1,535         -            48           0.0%        (75,295)     1.3%        (65,561)     1.5%        1,535         -            -            0.0%        (64,026)     1.5%
expenses
General and
administrative          (315,235)    5.5%        74,064        -            13,160       1.5%        (228,011)    4.0%        (264,090)    6.1%        71,882        -            -            1.7%        (192,208)    4.5%
expenses
Total operating costs   (5,159,139)  89.4%       93,376        -            96,952       3.3%        (4,968,811)  86.1%       (3,652,175)  84.9%       89,076        -            7,821        2.3%        (3,555,278)  82.7%
and expenses
Income from operations  273,736      4.7%        93,376        -            96,952       3.3%        464,064      8.0%        397,639      9.2%        89,076        -            7,821        2.3%        494,536      11.5%
                        Year Ended December 31, 2012                                                                          Year Ended December 31, 2012(excluding Motel 168)
                        GAAP         % of Total  Share-based   Acquisition  Integration  % of Total  Non-GAAP     % of Total  GAAP         % of Total  Share-based   Acquisition  Integration  % of Total  Non-GAAP     %of Total
                        Result       Revenue     Compensation  expenses     cost         Revenue     Result       Revenue     Result       Revenue     Compensation  expenses     cost         Revenue     Result       Revenue
                        US$ '000                 US$ '000      US$ '000     US$ '000                 US$ '000                 US$ '000                 US$ '000      US$ '000     US$ '000                 US$ '000
                        (unaudited)              (unaudited)   (unaudited)  (unaudited)              (unaudited)              (unaudited)              (unaudited)   (unaudited)  (unaudited)              (unaudited)
Leased-and-operated     (745,092)    80.5%       1,316         -            13,442       1.6%        (730,334)    78.9%       (516,652)    74.8%       1,161         -            1,255        0.4%        (514,236)    74.5%
hotel costs
Personnel costs of
Franchised-and-managed  (20,069)     2.2%        1,537         -            -            0.2%        (18,532)     2.0%        (16,649)     2.4%        1,352         -            -            0.2%        (15,297)     2.2%
hotels
Sales and marketing     (12,340)     1.3%        246           -            8            0.0%        (12,086)     1.3%        (10,523)     1.5%        246           -            -            0.0%        (10,277)     1.5%
expenses
General and
administrative          (50,599)     5.5%        11,888        -            2,112        1.5%        (36,599)     4.0%        (42,389)     6.1%        11,538        -            -            1.7%        (30,851)     4.5%
expenses
Total operating costs   (828,100)    89.4%       14,987        -            15,562       3.3%        (797,551)    86.1%       (586,213)    84.9%       14,297        -            1,255        2.3%        (570,661)    82.7%
and expenses
Income from operations  43,936       4.7%        14,987        -            15,562       3.3%        74,485       8.0%        63,825       9.2%        14,297        -            1,255        2.3%        79,377       11.5%
                        Year Ended December 31, 2011                                                                          Year Ended December 31, 2011(excluding Motel 168)
                        GAAP         % of Total  Share-based   Acquisition  Integration  % of Total  Non-GAAP     % of Total  GAAP         % of Total  Share-based   Acquisition  Integration  % of Total  Non-GAAP     % of Total
                        Result       Revenue     Compensation  expenses     cost         Revenue     Result       Revenue     Result       Revenue     Compensation  expenses     cost         Revenue     Result       Revenue
                        RMB '000                 RMB '000      RMB '000     RMB '000                 RMB '000                 RMB '000                 RMB '000      RMB '000     RMB '000                 RMB '000
                        (unaudited)              (unaudited)   (unaudited)  (unaudited)              (unaudited)              (unaudited)              (unaudited)   (unaudited)  (unaudited)              (unaudited)
Leased-and-operated     (2,960,666)  74.8%       3,283         -            14,635       0.5%        (2,942,748)  74.3%       (2,603,783)  72.5%       3,283         -            -            0.1%        (2,600,500)  72.4%
hotel costs
Personnel costs of
Franchised-and-managed  (72,009)     1.8%        3,369         -            -            0.1%        (68,640)     1.7%        (69,674)     1.9%        3,369         -            -            0.1%        (66,305)     1.8%
hotels
Sales and marketing     (44,451)     1.1%        656           -            -            0.0%        (43,795)     1.1%        (40,894)     1.1%        656           -            -            0.0%        (40,238)     1.1%
expenses
General and
administrative          (335,888)    8.5%        69,227        63,824       4,870        3.5%        (197,967)    5.0%        (322,030)    9.0%        69,227        63,824       -            3.7%        (188,979)    5.3%
expenses
Total operating costs   (3,413,014)  86.2%       76,535        63,824       19,505       4.0%        (3,253,150)  82.2%       (3,036,381)  84.5%       76,535        63,824       -            3.9%        (2,896,022)  80.6%
and expenses
Income from operations  297,438      7.5%        76,535        63,824       19,505       4.0%        457,302      11.5%       327,706      9.1%        76,535        63,824       -            3.9%        468,065      13.0%
Note 1: The conversion of Renminbi ("RMB") into United States dollars ("US$") is based on rate of US$1.00=RMB6.2301 on December 31, 2012, representing the certificated exchange rate published by the Federal Reserve Board.



Home Inns & Hotels
Management Inc.
Reconciliation of
GAAP and Non-GAAP
Results (continued)
                                   Quarter Ended                                                                                                                          Year Ended
                                   December 31, 2011                     September 30, 2012                    December 31, 2012                                          December 31, 2011               December 31, 2012
                                                      RMB'000                              RMB'000                                                    RMB'000                                RMB'000                                       RMB'000
                                   RMB '000           (excluding         RMB '000          (excluding          RMB '000            US$ '000           (excluding          RMB '000           (excluding   RMB '000     US$ '000            (excluding
                                                      Motel 168)                           Motel 168)                                                 Motel 168)                             Motel 168)                                    Motel 168)
                                   (unaudited)        (unaudited)        (unaudited)       (unaudited)         (unaudited)         (unaudited)        (unaudited)         (unaudited)        (unaudited)  (unaudited)  (unaudited)         (unaudited)
Net income/(loss)
attributable to Home               32,659             50,175             33,709            48,291              6,280               1,008              4,385               351,531            369,047      (26,776)     (4,299)             58,413
Inns Group's
shareholders (GAAP)
Foreign exchange                   (18,495)           (17,947)           6,748             6,536               (14,974)            (2,403)            (14,379)            (15,849)           (15,301)     (217)        (35)                (627)
loss, net
Share-based                        19,494             19,494             24,037            22,918              22,488              3,610              21,284              76,535             76,535       93,376       14,987              89,076
compensation
Gain on buy-back of                -                  -                  -                 -                   -                   -                  -                   (1,521)            (1,521)      -            -                   -
convertible bonds
Acquisition expenses               6,295              6,295              -                 -                   -                   -                  -                   63,824             63,824       -            -                   -
- Motel 168
Integration cost                   19,505             -                  26,630            7,714               20,491              3,289              107                 19,505             -            96,952       15,562              7,821
Interest expenses -
Upfront fee                        5,821              5,821              10,126            10,126              2,013               323                2,013               5,821              5,821        43,250       6,942               43,250
amortization of term
loans
Non-operating
(income)/expenses -
(Gain)/loss on change
in                                 7,315              7,315              7,818             7,818               (1,049)             (168)              (1,049)             7,315              7,315        6,665        1,070               6,665
 fair value of
interest swap
transaction
(Gain)/loss on change
in fair value of                   (35,966)           (35,966)           26,765            26,765              45,356              7,280              45,356              (198,547)          (198,547)    87,099       13,980              87,099
convertible notes
Withholding tax for
profit distribution                -                  -                  -                 -                   -                   -                  -                   17,469             17,469       -            -                   -
of previous periods
Adjusted net income
attributable to Home
Inns Group's                       36,628             35,187             135,833           130,168             80,605              12,939             57,717              326,083            324,642      300,349      48,207              291,697
shareholders
(Non-GAAP)
                                   Quarter Ended                                                                                                                          Year Ended
                                   December 31, 2011                     September 30, 2012                    December 31, 2012                                          December 31, 2011               December 31, 2012
                                                      RMB'000                              RMB'000                                                    RMB'000                                RMB'000                                       RMB'000
                                   RMB '000           (excluding         RMB '000          (excluding          RMB '000            US$ '000           (excluding          RMB '000           (excluding   RMB '000     US$ '000            (excluding
                                                      Motel 168)                           Motel 168)                                                 Motel 168)                             Motel 168)                                    Motel 168)
                                   (unaudited)        (unaudited)        (unaudited)       (unaudited)         (unaudited)         (unaudited)        (unaudited)         (unaudited)        (unaudited)  (unaudited)  (unaudited)         (unaudited)
Earnings per share
(GAAP)
- Basic                            0.36               0.55               0.37              0.53                0.07                0.01               0.05                4.17               4.38         (0.29)       (0.05)              0.64
- Diluted                          (0.06)             0.11               0.37              0.52                0.07                0.01               0.05                1.26               1.44         (0.29)       (0.05)              0.63
Weighted average
ordinary shares
outstanding
- Basic                            90,596             90,596             90,771            90,771              91,027              91,027             91,027              84,222             84,222       90,805       90,805              90,805
- Diluted                          99,672             99,672             92,600            92,600              92,445              92,445             92,445              94,299             94,299       90,805       90,805              92,222
Adjusted earnings per
share (Non-GAAP)
- Basic                            0.40               0.39               1.50              1.43                0.89                0.14               0.63                3.87               3.85         3.31         0.53                3.21
- Diluted                          0.37               0.35               1.47              1.41                0.87                0.14               0.62                3.46               3.44         3.31         0.53                3.16
Weighted average
ordinary shares
outstanding
- Basic                            90,596             90,596             90,771            90,771              91,027              91,027             91,027              84,222             84,222       90,805       90,805              90,805
- Diluted                          99,672             99,672             92,600            92,600              92,445              92,445             92,445              94,299             94,299       90,805       90,805              92,222
Note 1: The conversion of Renminbi ("RMB") into United States dollars ("US$") is based on rate of US$1.00=RMB6.2301 on December 31, 2012, representing the certificated exchange rate published by the Federal Reserve Board.
Note 2: The non-GAAP adjustment items do not include the tax impact.




Home Inns & Hotels
Management Inc.
Reconciliation of
GAAP and Non-GAAP
Results (continued)
                      Quarter Ended                                                                                                                                Year Ended
                      December 31, 2011                           September 30, 2012                    December 31, 2012                                          December 31, 2011                      December 31, 2012
                                          RMB'000                                    RMB'000                                                    RMB'000                                RMB'000                                             RMB'000
                      RMB '000            (excluding              RMB '000           (excluding         RMB '000            US$ '000            (excluding         RMB '000            (excluding         RMB '000            US$ '000     (excluding
                                          Motel 168)                                 Motel 168)                                                 Motel 168)                             Motel 168)                                          Motel 168)
                      (unaudited)         (unaudited)             (unaudited)        (unaudited)        (unaudited)         (unaudited)         (unaudited)        (unaudited)         (unaudited)        (unaudited)         (unaudited)  (unaudited)
Net income/(loss)
attributable to Home  32,659              50,175                  33,709             48,291             6,280               1,008               4,385              351,531             369,047            (26,776)            (4,299)      58,413
Inns Group's
shareholders
Interest income       (11,497)            (9,724)                 (615)              (425)              (861)               (138)               (685)              (31,996)            (30,223)           (11,874)            (1,906)      (10,873)
Interest expenses     28,313              27,683                  27,182             27,005             17,393              2,792               17,243             46,868              46,238             119,416             19,168       118,658
Income tax expense    33,815              41,949                  62,255             58,016             964                 155                 38,967             169,442             177,576            136,305             21,878       170,786
Depreciation and      145,941             98,485                  161,006            117,680            164,376             26,384              123,097            413,105             365,649            632,468             101,518      457,300
amortization
EBITDA (Non-GAAP)     229,231             208,568                 283,537            250,567            188,152             30,201              183,007            948,950             928,287            849,539             136,359      794,284
Foreign exchange      (18,495)            (17,947)                6,748              6,536              (14,974)            (2,403)             (14,379)           (15,849)            (15,301)           (217)               (35)         (627)
loss, net
Share-based           19,494              19,494                  24,037             22,918             22,488              3,610               21,284             76,535              76,535             93,376              14,987       89,076
compensation
Gain on buy-back of   -                   -                       -                  -                  -                   -                   -                  (1,521)             (1,521)            -                   -            -
convertible bonds
Acquisition expenses  6,295               6,295                   -                  -                  -                   -                   -                  63,824              63,824             -                   -            -
- Motel 168
Integration cost      19,505              -                       26,630             7,714              20,491              3,289               107                19,505              -                  96,952              15,562       7,821
Non-operating
(income)/expenses -
(Gain)/loss on
change in             7,315               7,315                   7,818              7,818              (1,049)             (168)               (1,049)            7,315               7,315              6,665               1,070        6,665
 fair value of
interest swap
transaction
(Gain)/loss on
change in fair value  (35,966)            (35,966)                26,765             26,765             45,356              7,280               45,356             (198,547)           (198,547)          87,099              13,980       87,099
of convertible notes
Adjusted EBITDA       227,379             187,759                 375,535            322,318            260,464             41,809              234,326            900,212             860,592            1,133,414           181,923      984,318
(Non-GAAP)
%of total revenue     17.4%               19.9%                   23.5%              26.9%              17.8%               17.8%               21.3%              22.7%               24.0%              19.6%               19.6%        22.9%
Note 1: The "Depreciation and amortization expense" includes the depreciation and amortization expenses of the Group.
The depreciation and amortization expenses of all leased-and-operated hotels are included in "Operating costs and expenses".
The depreciation and amortization expenses of administrative long-term assets are included in "General and administrative expenses".



Home Inns & Hotels
Management Inc.
Operating Data
                        As of and for the quarter ended                                                     As of and for the year ended
                        December 31, 2011           September 30, 2012          December 31, 2012           December 31, 2011           December 31, 2012
                        Group    Motel   excluding  Group    Motel   excluding  Group    Motel   excluding  Group    Motel   excluding  Group    Motel   excluding
                                 168     Motel 168           168     Motel 168           168     Motel 168           168     Motel 168           168     Motel 168
Total Hotels in         1,426    307     1,119      1,682    321     1,361      1,772    334     1,438      1,426    307     1,119      1,772    334     1,438
operation:

Leased-and-operated     698      144     554        770      146     624        803      151     652        698      144     554        803      151     652
hotels

Franchised-and-managed  728      163     565        912      175     737        969      183     786        728      163     565        969      183     786
hotels
Total rooms             176,562  47,941  128,621    204,678  48,619  156,059    214,070  49,745  164,325    176,562  47,941  128,621    214,070  49,745  164,325
Occupancy rate (as a    84.2%    73.5%   88.4%      90.3%    82.7%   92.7%      83.8%    77.4%   85.6%      88.8%    73.5%   90.3%      86.1%    78.0%   88.7%
percentage)
Average daily rate (in  168      154     173        174      162     177        165      160     166        172      154     173        168      160     170
RMB)
RevPAR (in RMB)         141      113     153        157      134     164        138      124     143        152      113     156        144      125     151
Like-for-like performance for hotels opened for at
least 18 months during the current quarter
                        As of and for the quarter ended
                        December 31, 2011           December 31, 2012
                        Group    Motel   excluding  Group    Motel   excluding
                                 168     Motel 168           168     Motel 168
Total Hotels in         1,201    282     919        1,201    282     919
operation:

Leased-and-operated     616      144     472        617      145     472
hotels

Franchised-and-managed  585      138     447        584      137     447
hotels
Total rooms             139,768  34,164  105,604    140,301  33,989  106,312
Occupancy rate (as a    86.0%    73.5%   91.5%      86.5%    77.7%   90.4%
percentage)
Average daily rate (in  167      154     172        169      161     172
RMB)
RevPAR (in RMB)         144      113     158        146      125     156
One Motel 168 Franchised-and-managed hotel was legally converted into Leased-and-operated hotels in 2012.
* "Occupancy rate" refers to the total number of occupied rooms divided by the total number of available rooms in a given period.
"Average daily rate" refers to total hotel room revenues divided by the total number of occupied rooms in a given period.
"RevPAR" represents revenue per available room, which is calculated by dividing total hotel room revenues by the total number of available rooms in a given
period, or by multiplying average daily rates and occupancy rates in a given period.

SOURCE Home Inns & Hotels Management Inc.

Website: http://english.homeinns.com
 
Press spacebar to pause and continue. Press esc to stop.