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Home Inns Group Reports First Quarter 2013 Financial Results

         Home Inns Group Reports First Quarter 2013 Financial Results

Total Revenues Increased 12% Year over Year to RMB 1.40 billion

Adjusted Net Income Improved to RMB 10.3 million

PR Newswire

SHANGHAI, May 13, 2013

SHANGHAI, May 13, 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 first
quarter ended March 31, 2013.

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 regarding
Motel 168's integration, Home Inns Group has separately presented key
financial data for Motel 168 hotels through the end of 2012. The Company will
continue to provide Motel 168's operating metrics and revenues through the
remaining integration period in 2013.

First Quarter 2013 Financial Highlights

  oTotal revenues increased 11.7% to RMB 1.402 billion (US$225.8 million) for
    the first quarter of 2013, which was within the guidance range of RMB
    1.385 billion to RMB 1.415 billion.
  oAdjusted net income (non-GAAP) was RMB 10.3 million (US$1.7million)
    compared to a loss of RMB 24.6 million in the first quarter of 2012.
  oAdjusted EBITDA (non-GAAP) increased 30.3% to RMB 216.1 million (US$34.8
    million) or 15.4% of total revenues compared to 13.2% in the first quarter
    of 2012.



Key Financial Results
(RMB in Millions except RMB        1Q2013         1Q2012       V%
per ADS)
Total Revenues                    1,402.2           1,255.7        11.7%
Income/Loss from Operations       12.1              -36.9          F
       Adj. Income from           39.2              9.7            302.2%
       Operations*
Net Loss                          -19.4             -103.2         F
       Adj. Net Income/Loss*      10.3              -24.6          F
EBITDA*                           187.4             93.1           101.3%
       Adj. EBITDA*               216.1             165.9          30.3%
Diluted Loss per ADS              -0.42             -2.28          F
       Adj. Diluted               0.22              -0.54          F
       Earnings/Loss per ADS*


Note: Consolidation of Motel 168 financial results started in October 1, 2011
"V%" represents year-over-year change in percentage
"F" or "UF" denote favourable or unfavourable change when prior year amount
is negative
* Indicates a non-GAAP financial measure which excludes share-based
compensation expenses, integration expenses, amortization on up-front fees of
acquisition term loans or gain or loss on change in fair value of convertible
notes, gain on change in fair value of interest swap transaction and net
foreign exchange gain (see commentary at the end of this earnings release for
full details).

First Quarter 2013 Operational Highlights

  oHome Inns Group opened 91 new hotels in the first quarter of 2013. As of
    March 31, 2013, the Group operated 1,859 hotels across 266 cities in China
    under its three brands. There were a total of 216 hotels contracted or
    under construction, including 152 franchised-and-managed hotels as a
    result of strong interest and increasing demand for this business model
    from existing and new potential franchisee partners. A
    franchised-and-managed hotel is a high-margin business model which
    requires minimal capital investments by the Company.

                            Hotels in Operations         Openings  
                                                                     Closures
                            Group  Home    Motel   Yitel  Group      Group
                                   Inns    168
Total Number of Hotels      1,859  1,517   335     7      91         4
   Leased-and-Operated      818    662     150     6      16         1
   Franchised-and-Managed   1,041  855     185     1      75         3
Contracted or under         216    178     29      9
Construction
   Leased-and-Operated      64     42      15      7
   Franchised-and-Managed   152    136     14      2

  oAs of March 31, 2013, Home Inns Group had a total of 13.2 million unique
    active non-corporate members under its frequent guests programs.

Operating Metrics
                                         1Q2013  4Q2012  1Q2012
Occupancy Rate                           83.6%   83.8%   80.7%
Average Daily Rate (ADR, RMB)            156     165     163
Revenue per Available Room (RevPAR, RMB) 131     138     132

  oThe year-over-year increase in occupancy rate was driven by the Company's
    organized promotions to maximize hotel utilization during the off-peak
    season where pricing was already depressed by an overall soft market
    environment. The resulting year-over-year decrease in RevPAR in the first
    quarter of 2013 was kept at a controlled minimum level.
  oFor the first quarter of 2013, RevPAR for Motel 168 improved 4.5% year
    over year to RMB 116 from RMB 111 as a net result of substantial
    year-over-year improvements in occupancy rate to 76.7% from 70.4%
    offsetting a decrease in ADR to RMB 151 from RMB 158, a decline which was
    consistent with the Company's short-term pricing approach in the quarter
    in response to the macro-economic conditions. The improvement trend at
    Motel 168 continues as the Company proceeds into the final stages of
    integration of Motel 168.

"Facing a continued weak market environment, the Company delivered reasonably
sound performances in the first quarter of 2013," said Mr. David Sun, the
Company's chief executive officer. "We achieved our revenue targets,
maintained stable performance at mature hotels relative to the overall market,
generated further integration results at Motel 168, and improved profitability
across the business through solid execution of productivity initiatives and
cost control measures."

"Market uncertainties remain as we look into the rest of 2013. On the other
hand, it was evident that we are able to navigate through challenging
environmental conditions and successfully manage internally controllable
aspects of our business. The Company is evolving into a more efficient and
effectively-managed enterprise to deliver growth with increasing
profitability," Mr. Sun continued. "We will keep our focus on the
franchise-growth strategy, multi-brand development and integration, capital
structure optimization and cash generation. We strongly believe Home Inns
Group will continue to leverage the opportunities in China's growing travel
and lodging sector and deliver sustainable profitable growth to our
shareholders over the long term."

Detailed Overview of Financial Results for First Quarter 2013

Total Revenues
(RMB/USD in Millions)               First Quarter 2013
                                    RMB      USD    V%
Leased-and-Operated Hotels     1,238.1  199.3  9.8%
Franchised-and-Managed Hotels  164.1    26.4   28.3%
Total Revenues                      1,402.2  225.8  11.7%
Less: Business Taxes                -87.9    -14.2  14.2%
Net Revenues                        1,314.3  211.6  11.5%


Note: "V%" represents year-over-year change in percentage

  oThe year-over-year increases in total revenues from both
    leased-and-operated and franchised-and-managed hotels in the first quarter
    of 2013 were mainly driven by an increase in the number of hotels in
    operation.
  oRevenues from Motel 168 included in total revenues were RMB 333.5 million
    (US$53.7 million) for the first quarter of 2013, which was within the
    guidance range of RMB 330 million to RMB 340 million. 

Total Operating Costs and Expenses / Total Operating Income
(RMB/USD in Millions)   First Quarter 2013
                                                 Share-Based   Integration  Adjusted
                        GAAP Results             Compensation  Costs        Non-GAAP Results
                        RMB      USD    Vpts     RMB      USD  RMB    USD   RMB      USD    Vpts
Leased-and-Operated     1,191.1  191.8  -2.4pts  2.3      0.4  3.8    0.6   1,185.0  190.8  -1.5pts
Hotel Costs
Franchised-and-Managed  29.0     4.7    0.3pts   2.9      0.5  -      -     26.1     4.2    0.2pts
Hotel Personnel Costs
Sales and Marketing     21.4     3.4    0.1pts   0.4      0.1  -      -     21.0     3.4    0.1pts
Expenses
General and
Administrative          68.7     11.1   -1.5pts  17.3     2.8  0.3    0.1   51.0     8.2    -0.5pts
Expenses
Total Operating Costs   1,310.1  210.9  -3.5pts  22.9     3.7  4.1    0.7   1,283.1  206.6  -1.7pts
and Expenses
Total Operating Income  12.1     1.9    3.8pts   22.9     3.7  4.1    0.7   39.2     6.3    2.0pts


Note: "Vpts" representsyear-over-year change in percentage points of total revenues

Total operating costs and expenses were RMB 1.31 billion (US$210.9 million)
for the first quarter of 2013, representing 93.4% of total revenues. Total
operating costs and expenses excluding any share-based compensation expenses
and integration costs (non-GAAP) for the first quarter of 2013 were 91.5% of
total revenues, compared to 93.2% in the same period a year ago.

  oTotal leased-and-operated hotel costs were RMB 1.19 billion (US$191.8
    million) for the first quarter of 2013. Total leased-and-operated hotel
    costs excluding any share-based compensation expenses and integration
    costs (non-GAAP) were 95.7% of leased-and-operated hotel revenues in the
    first quarter of 2013, compared to 95.8% in the same period a year ago.
    The year-over-year decrease in this expense ratio was mainly due to
    continued cost control initiatives at the hotel operational level.
    Pre-opening cost was RMB 27.2 million (US$4.4 million) for the first
    quarter of 2013.
  oPersonnel costs of franchised-and-managed hotels were RMB 29.0 million
    (US$4.7 million) for the first quarter of 2013. Personnel costs of
    franchised-and-managed hotels excluding share-based compensation expenses
    (non-GAAP) were 15.9% of franchised-and-managed hotel revenues in the
    first quarter of 2013, compared to 16.0% in the same period of 2012.
  oSales and marketing expenses were RMB 21.4 million (US$3.4 million) for
    the first quarter of 2013. Sales and marketing expenses excluding
    share-based compensation expenses (non-GAAP) were 1.5% of total revenues
    for the first of quarter 2013, compared to 1.4% in the same period of
    2012.
  oGeneral and administrative expenses were RMB 68.7 million (US$11.1
    million) for the first quarter of 2013. General and administrative
    expenses excluding any share-based compensation expenses and integration
    costs (non-GAAP) were 3.6% of total revenues in the first quarter of 2013,
    compared to 4.2% in the same period of 2012. This year-over-year decrease
    in general and administrative expenses as a percentage of total revenues
    was mainly due to continued cost control measures to maximize scale
    leverage.

Income from Operations was RMB 12.1 million (US$1.9 million) for the first
quarter of 2013. Income from operations excluding any share-based
compensation expenses and integration cost (non-GAAP) for the first quarter of
2013 was RMB 39.2 million (US$6.3 million), or 2.8% of total revenues,
compared to RMB 9.7 million, or 0.8% of total revenues, in the same period of
2012. This year-over-year increase in the income from operations margin rate
resulted from effective cost controls, productivity gains and efficiency in
headquarter functions.



EBITDA (non-GAAP)
(RMB/USD in Millions)      First Quarter   First Quarter 2012
                          2013
                          RMB        USD    %Rev   RMB         USD      %Rev
EBITDA (Non-GAAP)         187.4      30.2   13.4%  93.1        14.8     7.4%
   Net Foreign Exchange   -2.6       -0.4   -0.2%  -2.3        -0.4     -0.2%
   Gain
   Share-Based            22.9       3.7    1.6%   22.1        3.7      1.8%
   Compensation Expenses
   Integration Cost       4.1        0.7    0.3%   24.6        0.7      2.0%
   Non-Operating Income   -1.4       -0.2   -0.1%  3.6         -0.2     0.3%
   Loss on Fair Value
   Change in Convertible  5.7        0.9    0.4%   24.8        0.9      2.0%
   Notes
Adjusted EBITDA           216.1      34.8   15.4%  165.9       34.8     13.2%
(Non-GAAP)


Note: "%Rev" represents amount as a percentage of total revenues
Consolidated Net Income Attributable
to Home Inns Group's Shareholders
(RMB/USD in Millions)      First Quarter   First Quarter 2012
                          2013
                          RMB        USD    %Rev   RMB         USD      %Rev
Net Loss (GAAP)           -19.4      -3.1   -1.4%  -103.2      -3.1     -8.2%
   Net Foreign Exchange   -2.6       -0.4   -0.2%  -2.3        -0.4     -0.2%
   Gain
   Share-Based            22.9       3.7    1.6%   22.1        3.7      1.8%
   Compensation Expenses
   Integration Cost       4.1        0.7    0.3%   24.6        0.7      2.0%
   Amortization of
   Upfront Fees on Term   1.0        0.2    0.1%   5.8         0.2      0.5%
   Loan
   Non-Operating Income   -1.4       -0.2   -0.1%  3.6         -0.2     0.3%
   Loss on Fair Value
   Change in Convertible  5.7        0.9    0.4%   24.8        0.9      2.0%
   Notes
Adjusted Net Income       10.3       1.7    0.7%   -24.6       1.7      -2.0%
(Non-GAAP)


Note: "%Rev" represents amount as a percentage of total revenues
Basic and Diluted
Earnings Per Ordinary
Share and Per ADS
                          First Quarter 2013
                          Ordinary Share    ADS Share
                          RMB        USD    RMB    USD
Basic                     -0.21      -0.03  -0.42  -0.07
Diluted                   -0.21      -0.03  -0.42  -0.07
Adjusted Basic (Non-GAAP) 0.11       0.02   0.23   0.04
Adjusted Diluted          0.11       0.02   0.22   0.04
(Non-GAAP)





Cash Flow

Net operating cash flow for the first quarter of 2013 increased 104.5% year
over year to RMB 63.0 million (US$10.1 million) from RMB 30.8 million. Cash
paid for capital expenditures during the quarter was RMB 231.1 million
(US$37.2 million).

Capitalized expenditures for the first quarter of 2013 were RMB 192.0 million
(US$30.9 million).

Balance Sheet

As of March 31, 2013, Home Inns Group had cash and cash equivalents of RMB
481.8 million (US$77.6 million). The outstanding balance of convertible notes
issued in December 2010 plus interest swap contracts (both measured at fair
value) totalled RMB 1.07 billion (US$172.0 million). The outstanding balance
of the U.S. dollar-denominated four-year term loan was RMB 733.5 million
(US$118.1 million).

Outlook for Second Quarter  2013

Home Inns Group maintains its target 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.

The Company also maintains its total revenues expectation for the group for
2013 to be in the range of RMB 6,600 million to RMB 6,800 million,
representing growth of 14.4% to 17.9% over 2012.

Total revenues for Home Inns Group in the second quarter of 2013 are expected
to be in the range of RMB 1,580 million to RMB 1,610 million.

Total revenues for Motel 168 brand in the second quarter of 2013 are expected
to be in the range of RMB 380 million to RMB 390 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 6.2108 to
US$1.00, the noon buying rate for March 31, 2013 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, May 13, 2013 (9 AM Beijing/Hong Kong Time on Tuesday, May 14,
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, May 20, 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:           35503363

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 number of
hotels and hotel rooms as well as geographic coverage of the hotel chain.
Since the Company commenced operations in 2002, it has built Home Inns as one
of the best-known economy hotel brands in China. In October of 2011, the
Company 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 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 integration costs
(f) income from operations excluding share-based compensation expenses and
integration costs
(g) adjusted net income attributable to shareholders excluding any
share-based compensation expenses, foreign exchange gain or loss, integration
cost, upfront fee amortization of term loan, and gain or loss from fair value
change of convertible notes and interest swap derivatives
(h) adjusted basic and diluted earnings per ADS and per share excluding
foreign exchange gain or loss, share-based compensation expenses, gain or loss
from fair value change of convertible notes, integration cost, gain or loss on
change in fair value of interest swap transaction and upfront fee amortization
of term loan, and
(i) adjusted EBITDA excluding foreign exchange gain or loss, share-based
compensation expenses, gain or loss from fair value change of convertible
notes, integration costs, and gain or loss on change in fair value of interest
swap transaction

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 first half of 2013.

For investor and media inquiries, please contact:

Johnny Wang
Home Inns & Hotels Management Inc.
Tel: +86-21-3337-3333*3870
Email: johnnywang@homeinns.com

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

Appendix 1:

Motel 168 operations have been integrated into the Group for management and
measurement purposes since its acquisition on October 1, 2011. For the
purpose of providing more context and comprehensive information to investors
regarding Motel 168's integration, Home Inns Group has separately presented
key financial data for Motel 168 hotels through the end of 2012. The Company
will continue to provide Motel 168's operating metrics and revenues through
the remaining integration period in 2013.

First Quarter 2013 Operational and Revenues for Motel 168 Hotels
Operating Metrics
                                          1Q2013  4Q2012  1Q2012
Occupancy Rate                            76.7%   77.4%   70.4%
Average Daily rate (ADR, RMB)             151     160     158
Revenue per Available Room (RevPAR, RMB)  116     124     111


Total Revenues
(RMB in Millions)
                                          1Q2013  1Q2012  V%
Total Revenues                            333.5   327.3   1.9%
      Leased-and-Operated Hotels          314.9   311.8   1.0%
      Franchised-and-Managed Hotels       18.6    15.5    19.8%


Note: "V%" represents year-over-year change in percentage





Home Inns & Hotels Management Inc.
Unaudited Condensed Consolidated Balance Sheet
                                           December 31,   March 31, 2013
                                           2012
                                           RMB '000       RMB '000   US$ '000
ASSETS
Current assets:
Cash and cash equivalents                  663,156        481,782    77,572
Restricted cash                            205,739        200,944    32,354
Accounts receivable, net                   98,176         130,692    21,043
Receivables from related parties           6,818          6,389      1,029
Consumables                                41,600         40,403     6,505
Prepayments and other current assets       172,534        154,600    24,892
Deferred tax assets                        80,369         68,975     11,106
Total current assets                       1,268,392      1,083,785  174,501
Investment in a jointly controlled         6,625          6,352      1,023
entity
Property and equipment, net                3,846,835      3,865,501  622,384
Goodwill                                   2,254,631      2,254,631  363,018
Intangible assets, net                     1,149,419      1,138,915  183,377
Other assets                               117,350        116,617    18,776
Non-current deferred tax assets            310,762        357,053    57,489
Total assets                               8,954,014      8,822,854  1,420,568
LIABILITIES
Current liabilities:
Accounts payable                           76,825         66,626     10,727
Payables to related parties                3,798          4,898      789
Short term loans                           12,571         -          -
Finance lease liabilities                  6,660          5,554      894
Salaries and welfare payable               215,569        111,823    18,005
Income tax payable                         76,382         70,961     11,425
Other taxes payable                        27,761         33,053     5,322
Deferred revenues                          202,874        198,347    31,936
Other unpaid and accruals                  165,886        187,169    30,136
Other payables                             925,134        850,864    136,998
Deferred tax liability                     29,439         29,756     4,791
Total current liabilities                  1,742,899      1,559,051  251,023
Long term loans                            735,404        733,461    118,094
Deferred rental                            631,618        678,518    109,248
Deferred revenues                          45,089         51,681     8,321
Finance lease liabilities                  1,620          1,041      168
Deposits due to franchisees                91,462         94,871     15,275
Other long term payables                   10,620         8,444      1,360
Unfavorable lease liabilities              370,548        362,318    58,337
Financial liabilities*                     1,066,771      1,068,262  172,001
Deferred tax liabilities                   288,321        285,963    46,043
Total liabilities                          4,984,352      4,843,610  779,870
Commitments and contingencies
Shareholders' equity
Ordinary shares (US$0.005 par value;
200,000,000 shares authorized,
91,672,320 and 92,167,262 shares issued   3,574          3,589      578
and outstanding as of December 31, 2012
and March 31 2013, respectively)
Additional paid-in capital                 2,802,905      2,833,270  456,184
Statutory reserves                         158,417        158,417    25,507
Retained earnings                          992,505        973,119    156,682
Total Home Inns shareholders' equity       3,957,401      3,968,395  638,951
Noncontrolling interests                   12,261         10,849     1,747
Total shareholders' equity                3,969,662      3,979,244  640,698
Total liabilities and shareholders'        8,954,014      8,822,854  1,420,568
equity
                                           -              -          -
Note 1: The conversion of Renminbi ("RMB") into United States dollars ("US$")
is based on rate of US$1.00=RMB6.2108 on March 31, 2013, representing the
certificated exchange rate published by the Federal Reserve Board.
Note 2:Financial liabilities represent convertible notes and interest swap
contracts, both measured at fair value.



Home Inns & Hotels Management Inc.
Unaudited Condensed Consolidated Statement of Operations
                             Quarter Ended
                             March 31,    December 31,  March 31, 2013
                             2012         2012
                             RMB '000     RMB '000      RMB '000     US$ '000
Revenues:
Leased-and-operated         1,127,837    1,304,958     1,238,105    199,347
hotels
Franchised-and-managed      127,864      160,724       164,113      26,424
hotels
Total revenues             1,255,701    1,465,682     1,402,218    225,771
Less: Business tax and      (76,976)     (90,149)      (87,943)     (14,160)
related surcharges
Net revenues               1,178,725    1,375,533     1,314,275    211,611
Operating costs and
expenses:
 Leased-and-operated
hotel costs –
Rents and utilities        (492,314)    (514,213)     (551,068)    (88,727)
Personnel costs            (254,558)    (245,909)     (275,184)    (44,307)
Depreciation and            (149,893)    (158,078)     (169,500)    (27,291)
amortization
Consumables, food and       (67,743)     (99,834)      (72,005)     (11,594)
beverage
Others                     (132,354)    (190,804)     (123,339)    (19,859)
 Total
leased-and-operated hotel    (1,096,862)  (1,208,838)   (1,191,096)  (191,778)
costs
 Personnel costs of
Franchised-and-managed       (22,593)     (24,581)      (28,992)     (4,668)
hotels
 Sales and marketing      (18,175)     (24,793)      (21,380)     (3,442)
expenses
 General and              (79,972)     (83,408)      (68,676)     (11,058)
administrative expenses
Total operating costs and   (1,217,602)  (1,341,620)   (1,310,144)  (210,946)
expenses
Other income               1,947        2,341         7,956        1,281
Income/(loss) from          (36,930)     36,254        12,087       1,946
operations
Interest income            7,062        861           340          55
Interest expenses          (30,922)     (17,393)      (15,787)     (2,542)
Loss from equity            (502)        (493)         (273)        (44)
investment
Loss on change in fair
value of convertible         (24,800)     (45,356)      (5,661)      (911)
notes
Non-operating income       3,439        19,683        4,431        714
Non-operating expenses     (3,585)      -             -            -
Foreign exchange gain,      2,254        14,974        2,579        415
net
(Loss)/income before
income tax expenses and      (83,984)     8,530         (2,284)      (367)
noncontrolling interests
Income tax expense         (18,917)     (964)         (16,365)     (2,635)
Net (loss)/income          (102,901)    7,566         (18,649)     (3,002)
Less:Net income
attributable to              (273)        (1,286)       (736)        (119)
noncontrolling interests
Net (loss)/income
attributable to Home Inns    (103,174)    6,280         (19,385)     (3,121)
Group's shareholders
(Loss)/earnings per share
- Basic                      (1.14)       0.07          (0.21)       (0.03)
- Diluted                    (1.14)       0.07          (0.21)       (0.03)
Weighted average ordinary
shares outstanding
- Basic                      90,666       91,027        91,794       91,794
- Diluted                    90,666       92,445        91,794       91,794
Share-based compensation
expense was included in
the statement of
operations as follows:
Leased-and-operated hotel    1,955        2,038         2,279        367
costs – Personnel costs
Personnel costs of
Franchised-and-managed       2,164        2,476         2,914        469
hotels
Sales and marketing          374          354           386          62
expenses
General and administrative   17,619       17,620        17,349       2,793
expenses
Note 1: The conversion of Renminbi ("RMB") into United States dollars ("US$")
is based on rate of US$1.00=RMB6.2108 on March 31, 2013, 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 March 31, 2013
                        GAAP         % of     Share-based   Integration  % of     Non-GAAP     % of
                        Result       Total    Compensation  cost         Total    Result       Total
                                     Revenue                              Revenue               Revenue
                        RMB '000              RMB '000      RMB '000               RMB '000
                        (unaudited)           (unaudited)   (unaudited)            (unaudited)
Leased-and-operated     (1,191,096)  84.9%    2,279         3,823         0.4%     (1,184,994)  84.5%
hotel costs
Personnel costs of
Franchised-and-managed  (28,992)     2.1%     2,914         -             0.2%     (26,078)     1.9%
hotels
Sales and marketing     (21,380)     1.5%     386           -             0.0%     (20,994)     1.5%
expenses
General and
administrative          (68,676)     4.9%     17,349        317           1.3%     (51,010)     3.6%
expenses
Total operating costs   (1,310,144)  93.4%    22,928        4,140         1.9%     (1,283,076)  91.5%
and expenses
Income from operations  12,087       0.9%     22,928        4,140         1.9%     39,155       2.8%
                        Quarter Ended March 31, 2013
                        GAAP         % of     Share-based   Integration  % of     Non-GAAP     % of
                        Result       Total    Compensation  cost         Total    Result       Total
                                     Revenue                              Revenue               Revenue
                        US$ '000              US$ '000      US$ '000               US$ '000
                        (unaudited)           (unaudited)   (unaudited)            (unaudited)
Leased-and-operated     (191,778)    84.9%    367           616           0.4%     (190,795)    84.5%
hotel costs
Personnel costs of
Franchised-and-managed  (4,668)      2.1%     469           -             0.2%     (4,199)      1.9%
hotels
Sales and marketing     (3,442)      1.5%     62            -             0.0%     (3,380)      1.5%
expenses
General and
administrative          (11,058)     4.9%     2,793         51            1.3%     (8,214)      3.6%
expenses
Total operating costs   (210,946)    93.4%    3,692         667           1.9%     (206,587)    91.5%
and expenses
Income from operations  1,946        0.9%     3,692         667           1.9%     6,305        2.8%
                        Quarter Ended December 31, 2012
                        GAAP         % of     Share-based   Integration  % of     Non-GAAP     % of
                        Result       Total    Compensation  cost         Total    Result       Total
                                     Revenue                              Revenue               Revenue
                        RMB '000              RMB '000      RMB '000               RMB '000
                        (unaudited)           (unaudited)   (unaudited)            (unaudited)
Leased-and-operated     (1,208,838)  82.5%    2,038         19,933        1.5%     (1,186,867)  81.0%
hotel costs
Personnel costs of
Franchised-and-managed  (24,581)     1.7%     2,476         -             0.2%     (22,105)     1.5%
hotels
Sales and marketing     (24,793)     1.7%     354           -             0.0%     (24,439)     1.7%
expenses
General and
administrative          (83,408)     5.7%     17,620        558           1.2%     (65,230)     4.5%
expenses
Total operating costs   (1,341,620)  91.5%    22,488        20,491        2.9%     (1,298,641)  88.6%
and expenses
Income from operations  36,254       2.5%     22,488        20,491        2.9%     79,233       5.4%
                        Quarter Ended March 31, 2012
                        GAAP         %of      Share-based   Integration  %of      Non-GAAP     %of
                        Result       Total    Compensation  cost         Total    Result       Total
                                     Revenue                              Revenue               Revenue
                        RMB '000              RMB '000      RMB '000               RMB '000
                        (unaudited)           (unaudited)   (unaudited)            (unaudited)
Leased-and-operated     (1,096,862)  87.4%    1,955         14,463        1.3%     (1,080,444)  86.0%
hotel costs
Personnel costs of
Franchised-and-managed  (22,593)     1.8%     2,164         -             0.2%     (20,429)     1.6%
hotels
Sales and marketing     (18,175)     1.4%     374           -             0.0%     (17,801)     1.4%
expenses
General and
administrative          (79,972)     6.4%     17,619        10,090        2.2%     (52,263)     4.2%
expenses
Total operating costs   (1,217,602)  97.0%    22,112        24,553        3.7%     (1,170,937)  93.2%
and expenses
(Loss)/income from      (36,930)     2.9%     22,112        24,553        3.7%     9,735        0.8%
operations
Note 1: The conversion of Renminbi ("RMB") into United States dollars ("US$") is based on rate of
US$1.00=RMB6.2108 on March 31, 2013, 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
                        March 31,      December 31,   March 31, 2013
                        2012           2012
                        RMB '000       RMB '000       RMB '000     US$ '000
                        (unaudited)    (unaudited)    (unaudited)  (unaudited)
Net (loss)/income
attributable to Home    (103,174)      6,280          (19,385)     (3,121)
Inns Group's
shareholders (GAAP)
Foreign exchange        (2,254)        (14,974)       (2,579)      (415)
gain, net
Share-based             22,112         22,488         22,928       3,692
compensation
Integration cost        24,553         20,491         4,140        667
Interest expenses --
Upfront fee             5,821          2,013          959          154
amortization of term
loans
Non-operating
expenses/(income) --
Loss/(gain) on change   3,585          (1,049)        (1,380)      (222)
in fair value of
interest swap
transaction
Loss on change in
fair value of           24,800         45,356         5,661        911
convertible notes
Adjusted net
(loss)/income
attributable to Home    (24,557)       80,605         10,344       1,666
Inns Group's
shareholders
(Non-GAAP)
                        Quarter Ended
                        March 31,      December 31,   March 31, 2013
                        2012           2012
                        RMB '000       RMB '000       RMB '000     US$ '000
                        (unaudited)    (unaudited)    (unaudited)  (unaudited)
(Loss)/earnings per
share (GAAP)
- Basic                 (1.14)         0.07           (0.21)       (0.03)
- Diluted               (1.14)         0.07           (0.21)       (0.03)
Weighted average
ordinary shares
outstanding
- Basic                 90,666         91,027         91,794       91,794
- Diluted               90,666         92,445         91,794       91,794
Adjusted
(loss)/earnings per
share (Non-GAAP)
- Basic                 (0.27)         0.89           0.11         0.02
- Diluted               (0.27)         0.87           0.11         0.02
Weighted average
ordinary shares
outstanding
- Basic                 90,666         91,027         91,794       91,794
- Diluted               90,666         92,445         92,804       92,804
Note 1: The conversion of Renminbi ("RMB") into United States dollars ("US$")
is based on rate of US$1.00=RMB6.2108 on March 31, 2013, 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
                           March 31,    December 31,  March 31, 2013
                           2012         2012
                           RMB '000     RMB '000      RMB '000     US$ '000
                           (unaudited)  (unaudited)   (unaudited)  (unaudited)
Net (loss)/income
attributable to Home Inns  (103,174)    6,280         (19,385)     (3,121)
Group's shareholders
Interest income            (7,062)      (861)         (340)        (55)
Interest expenses          30,922       17,393        15,787       2,542
Income tax expense         18,917       964           16,365       2,635
Depreciation and           153,463      164,376       174,924      28,164
amortization
EBITDA (Non-GAAP)          93,066       188,152       187,351      30,165
Foreign exchange gain,     (2,254)      (14,974)      (2,579)      (415)
net
Share-based compensation   22,112       22,488        22,928       3,692
Integration cost           24,553       20,491        4,140        667
Non-operating
expenses/(income)--
Loss/(gain) on change in   3,585        (1,049)       (1,380)      (222)
fair value of interest
swap transaction
Loss on change in fair
value of convertible       24,800       45,356        5,661        911
notes
Adjusted EBITDA            165,862      260,464       216,121      34,798
(Non-GAAP)
%of total revenue          13.2%        17.8%         15.4%        15.4%
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
                        March 31, 2012              December 31, 2012           March 31, 2013
                        Group    Motel   excluding  Group    Motel   excluding  Group    Motel   excluding
                                 168     Motel 168           168     Motel 168           168     Motel 168
Total Hotels in         1,479    311     1,168      1,772    334     1,438      1,859    335     1,524
operation:

Leased-and-operated     702      144     558        803      151     652        818      150     668
hotels

Franchised-and-managed  777      167     610        969      183     786        1,041    185     856
hotels
Total rooms             182,146  48,129  134,017    214,070  49,745  164,325    222,841  49,205  173,636
Occupancy rate (as a    80.7%    70.4%   84.4%      83.8%    77.4%   85.6%      83.6%    76.7%   85.6%
percentage)
Average daily rate (in  163      158     165        165      160     166        156      151     158
RMB)
RevPAR (in RMB)         132      111     139        138      124     143        131      116     135
Like-for-like performance for hotels opened for at least 18
months during the current quarter
                        As of and for the quarter ended
                        March 31, 2012              March 31, 2013
                        Group    Motel   excluding  Group    Motel   excluding
                                 168     Motel 168           168     Motel 168
Total Hotels in         1,278    289     989        1,278    289     989
operation:

Leased-and-operated     638      143     495        639      144     495
hotels

Franchised-and-managed  640      146     494        639      145     494
hotels
Total rooms             159,291  45,786  113,505    158,773  44,610  114,163
Occupancy rate (as a    83.4%    70.7%   88.6%      86.0%    77.0%   89.6%
percentage)
Average daily rate (in  165      157     166        160      153     162
RMB)
RevPAR (in RMB)         137      111     147        137      117     145
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.
The operating data of multi-brand conversion hotels were included in "Motel 168".

SOURCE Home Inns & Hotels Management Inc.

Website: http://english.homeinns.com
 
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