Document_and_Entity_Informatio
Document and Entity Information | 12 Months Ended |
Dec. 31, 2013 | |
Document and Entity Information | ' |
Entity Registrant Name | 'CTRIP COM INTERNATIONAL LTD |
Entity Central Index Key | '0001269238 |
Document Type | '20-F |
Document Period End Date | 31-Dec-13 |
Amendment Flag | 'false |
Current Fiscal Year End Date | '--12-31 |
Entity Well-known Seasoned Issuer | 'Yes |
Entity Voluntary Filers | 'No |
Entity Current Reporting Status | 'Yes |
Entity Filer Category | 'Large Accelerated Filer |
Entity Common Stock, Shares Outstanding | 33,828,251 |
Document Fiscal Year Focus | '2013 |
Document Fiscal Period Focus | 'FY |
CONSOLIDATED_STATEMENTS_OF_INC
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
USD ($) | CNY | CNY | CNY | Product development | Product development | Product development | Product development | Sales and marketing | Sales and marketing | Sales and marketing | Sales and marketing | General and administrative | General and administrative | General and administrative | General and administrative | |
USD ($) | CNY | CNY | CNY | USD ($) | CNY | CNY | CNY | USD ($) | CNY | CNY | CNY | |||||
Revenues: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Hotel reservation | $365,754,974 | 2,214,170,887 | 1,702,500,571 | 1,486,898,858 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ticketing Services | 357,101,320 | 2,161,784,259 | 1,690,285,903 | 1,437,118,164 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Packaged-tour | 154,564,106 | 935,684,729 | 689,660,631 | 534,640,183 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Corporate travel | 44,103,364 | 266,988,534 | 199,756,068 | 161,610,123 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Others | 22,860,177 | 138,388,653 | 126,989,085 | 106,036,864 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total revenues | 944,383,941 | 5,717,017,062 | 4,409,192,258 | 3,726,304,192 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Less: business tax and related surcharges | -54,556,968 | -330,271,520 | -250,401,009 | -228,219,564 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net revenues | 889,826,973 | 5,386,745,542 | 4,158,791,249 | 3,498,084,628 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cost of revenues | -229,077,600 | -1,386,767,067 | -1,037,791,093 | -805,129,784 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gross profit | 660,749,373 | 3,999,978,475 | 3,121,000,156 | 2,692,954,844 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Operating expenses: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Product development | -205,778,151 | -1,245,719,192 | -911,904,722 | -601,485,367 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Sales and marketing | -209,692,043 | -1,269,412,720 | -984,002,165 | -624,599,686 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
General and administrative | -106,778,479 | -646,404,879 | -570,487,457 | -400,875,621 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total operating expenses | -522,248,673 | -3,161,536,791 | -2,466,394,344 | -1,626,960,674 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Income from operations | 138,500,700 | 838,441,684 | 654,605,812 | 1,065,994,170 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest income | 33,048,967 | 200,068,533 | 177,144,144 | 106,002,655 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest expense | -9,422,957 | -57,043,756 | -11,344,180 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Other income (net) | 26,945,897 | 163,122,374 | 130,287,943 | 117,623,725 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Income before income tax expense, equity in income of affiliates and non-controlling interests | 189,072,607 | 1,144,588,835 | 950,693,719 | 1,289,620,550 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Income tax expense | -48,522,444 | -293,740,322 | -294,525,956 | -262,186,225 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Equity in income of affiliates | 9,176,879 | 55,554,072 | 34,343,000 | 57,525,830 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income | 149,727,042 | 906,402,585 | 690,510,763 | 1,084,960,155 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net (income) / loss attributable to non-controlling interests | 15,183,623 | 91,917,099 | 23,895,101 | -8,545,258 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income attributable to Ctrip's shareholders | 164,910,665 | 998,319,684 | 714,405,864 | 1,076,414,897 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income | 149,727,042 | 906,402,585 | 690,510,763 | 1,084,960,155 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Other comprehensive income: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Foreign currency translation | -2,340,309 | -14,167,524 | 21,039,744 | -94,851,411 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unrealized securities holding (losses) / gains , net of tax | 73,604,700 | 445,580,779 | 92,647,858 | -276,586,950 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total comprehensive income | 220,991,433 | 1,337,815,840 | 804,198,365 | 713,521,794 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Comprehensive (income) / loss attributable to non-controlling interests | 15,183,623 | 91,917,099 | 23,895,101 | -8,545,258 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Comprehensive income attributable to Ctrip's shareholders | 236,175,056 | 1,429,732,939 | 828,093,466 | 704,976,536 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted average ordinary shares outstanding | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
- Basic shares (in shares) | 32,905,601 | 32,905,601 | 34,236,761 | 35,977,063 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
- Diluted shares (in shares) | 38,069,841 | 38,069,841 | 36,090,785 | 38,030,974 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based compensation included in Operating expense above is as follows: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based compensation | ' | ' | ' | ' | $22,906,354 | 138,668,196 | 132,583,177 | 98,955,335 | $8,111,490 | 49,104,528 | 55,892,394 | 48,191,019 | $41,322,952 | 250,156,753 | 243,245,751 | 195,645,003 |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 |
USD ($) | CNY | CNY | |
Current assets: | ' | ' | ' |
Cash and cash equivalents | $1,179,170,559 | 7,138,344,814 | 3,421,532,962 |
Restricted cash | 122,163,902 | 739,543,614 | 768,228,577 |
Short-term investment | 600,474,248 | 3,635,090,955 | 1,408,664,335 |
Accounts receivable, net | 250,793,734 | 1,518,230,029 | 983,804,403 |
Due from related parties | 3,596,919 | 21,774,669 | 5,328,170 |
Prepayments and other current assets | 200,828,632 | 1,215,756,287 | 993,820,540 |
Deferred tax assets, current | 16,019,872 | 96,979,500 | 61,840,526 |
Total current assets | 2,373,047,866 | 14,365,719,868 | 7,643,219,513 |
Long-term deposits and prepayments | 92,370,889 | 559,185,652 | 210,618,310 |
Long-term loan receivable | 29,499,992 | 178,584,102 | ' |
Long-term receivables due from related parties | 1,349,037 | 8,166,667 | ' |
Land use rights | 17,753,902 | 107,476,794 | 110,659,284 |
Property, equipment and software | 233,401,671 | 1,412,943,693 | 1,123,937,191 |
Investments | 471,978,043 | 2,857,213,480 | 1,437,247,949 |
Goodwill | 160,650,707 | 972,531,184 | 822,585,341 |
Intangible assets | 58,914,882 | 356,653,022 | 321,483,420 |
Total assets | 3,438,966,989 | 20,818,474,462 | 11,669,751,008 |
Current liabilities: | ' | ' | ' |
Short-term borrowings | 127,954,696 | 774,599,341 | 453,478,628 |
Accounts payable | 270,503,299 | 1,637,545,824 | 1,023,672,151 |
Due to related parties | 1,852,880 | 11,216,780 | 10,395,726 |
Salary and welfare payable | 42,559,387 | 257,641,763 | 229,969,924 |
Taxes payable | 52,083,793 | 315,299,656 | 216,456,010 |
Advances from customers | 405,030,221 | 2,451,931,450 | 1,414,865,769 |
Accrued liability for customer reward program | 47,023,958 | 284,668,935 | 217,548,153 |
Other payables and accruals | 104,911,864 | 635,104,949 | 343,757,881 |
Total current liabilities | 1,051,920,098 | 6,368,008,698 | 3,910,144,242 |
Deferred tax liabilities, non-current | 10,439,426 | 63,197,155 | 53,309,153 |
Long-term Debt | 934,500,000 | 5,657,182,650 | 1,121,418,000 |
Total liabilities | 1,996,859,524 | 12,088,388,503 | 5,084,871,395 |
Commitments and contingencies (Note 21) | ' | ' | ' |
Shareholders' equity | ' | ' | ' |
Share capital (US$0.01 par value; 100,000,000 shares authorized, 32,354,634 and 33,828,251 shares issued and outstanding as of December 31, 2012 and 2013, respectively.) | 501,097 | 3,033,490 | 2,979,144 |
Additional paid-in capital | 675,369,571 | 4,088,484,766 | 3,818,256,227 |
Statutory reserves | 19,566,419 | 118,449,230 | 103,222,512 |
Accumulated other comprehensive (loss) / income | 61,554,847 | 372,634,580 | -58,778,675 |
Retained earnings | 908,359,306 | 5,498,934,733 | 4,515,841,767 |
Less: Treasury stock (4,365,306 and 3,777,087 shares as of December 31, 2012 and 2013, respectively.) | -256,230,284 | -1,551,141,268 | -1,891,888,900 |
Total Ctrip's shareholders' equity | 1,409,120,956 | 8,530,395,531 | 6,489,632,075 |
Non-controlling interests | 32,986,509 | 199,690,428 | 95,247,538 |
Total shareholders' equity | 1,442,107,465 | 8,730,085,959 | 6,584,879,613 |
Total liabilities and shareholders' equity | $3,438,966,989 | 20,818,474,462 | 11,669,751,008 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Shareholders' equity | ' | ' |
Share capital, par value (in dollars per share) | $0.01 | $0.01 |
Share capital, shares authorized | 100,000,000 | 100,000,000 |
Share capital, shares issued | 33,828,251 | 32,354,634 |
Share capital, shares outstanding | 33,828,251 | 32,354,634 |
Treasury stock, shares | 3,777,087 | 4,365,306 |
CONSOLIDATED_STATEMENTS_OF_SHA
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY | Total | Total | Ordinary shares | Additional paid-in capital | Statutory reserves | Accumulated other comprehensive income/(loss) | Retained earnings | Treasury stock | Total Ctrip's shareholders' equity | Non-controlling interests |
USD ($) | CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | |
Balance at Dec. 31, 2010 | ' | 6,189,922,788 | 2,926,132 | 3,073,551,037 | 93,384,908 | 198,972,084 | 2,734,858,610 | ' | 6,103,692,771 | 86,230,017 |
Balance (in shares) at Dec. 31, 2010 | ' | ' | 35,885,163 | ' | ' | ' | ' | ' | ' | ' |
Changes in shareholders' equity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Exercise of share option | ' | 51,067,902 | 13,395 | 51,054,507 | ' | ' | ' | ' | 51,067,902 | ' |
Exercise of share option (in shares) | ' | 207,142 | 207,142 | ' | ' | ' | ' | ' | ' | ' |
Share-based compensation | ' | 341,581,534 | ' | 341,581,534 | ' | ' | ' | ' | 341,581,534 | ' |
Appropriations to statutory reserves | ' | ' | ' | ' | 4,664,760 | ' | -4,664,760 | ' | ' | ' |
Repurchasing common stock | ' | -158,761,225 | ' | ' | ' | ' | ' | -158,761,225 | -158,761,225 | ' |
Repurchasing common stock (in shares) | ' | ' | -242,832 | ' | ' | ' | ' | -242,832 | ' | ' |
Foreign currency translation adjustments | ' | -94,851,411 | ' | ' | ' | -94,851,411 | ' | ' | -94,851,411 | ' |
Unrealized securities holding gains (losses) | ' | -276,586,950 | ' | ' | ' | -276,586,950 | ' | ' | -276,586,950 | ' |
Net income / (loss) | ' | 1,084,960,155 | ' | ' | ' | ' | 1,076,414,897 | ' | 1,076,414,897 | 8,545,258 |
Acquisition of a subsidiary | ' | 18,137,400 | ' | ' | ' | ' | ' | ' | ' | 18,137,400 |
Acquisition of additional stake in subsidiaries | ' | -10,404,360 | ' | -262,654 | ' | ' | ' | ' | -262,654 | -10,141,706 |
Balance at Dec. 31, 2011 | ' | 7,145,065,833 | 2,939,527 | 3,465,924,424 | 98,049,668 | -172,466,277 | 3,806,608,747 | -158,761,225 | 7,042,294,864 | 102,770,969 |
Balance (in shares) at Dec. 31, 2011 | ' | ' | 35,849,473 | ' | ' | ' | ' | ' | ' | ' |
Changes in shareholders' equity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Issuance of common stock pursuant to share incentive plan | ' | 93,255,168 | 39,617 | 93,215,551 | ' | ' | ' | ' | 93,255,168 | ' |
Issuance of common stock pursuant to share incentive plan (in shares) | ' | ' | 627,635 | ' | ' | ' | ' | ' | ' | ' |
Exercise of share option (in shares) | ' | 502,991 | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based compensation | ' | 429,165,035 | ' | 429,165,035 | ' | ' | ' | ' | 429,165,035 | ' |
Appropriations to statutory reserves | ' | ' | ' | ' | 5,172,844 | ' | -5,172,844 | ' | ' | ' |
Repurchasing common stock | ' | -1,733,127,675 | ' | ' | ' | ' | ' | -1,733,127,675 | -1,733,127,675 | ' |
Repurchasing common stock (in shares) | ' | ' | -4,122,474 | ' | ' | ' | ' | -4,122,474 | ' | ' |
Foreign currency translation adjustments | ' | 21,039,744 | ' | ' | ' | 21,039,744 | ' | ' | 21,039,744 | ' |
Unrealized securities holding gains (losses) | ' | 92,647,858 | ' | ' | ' | 92,647,858 | ' | ' | 92,647,858 | ' |
Purchasing of Purchased Call Option | ' | -346,009,222 | ' | -346,009,222 | ' | ' | ' | ' | -346,009,222 | ' |
Sale of Issued Warrants | ' | 167,503,950 | ' | 167,503,950 | ' | ' | ' | ' | 167,503,950 | ' |
Purchasing and settlement Capped Call Option | ' | 4,809,282 | ' | 4,809,282 | ' | ' | ' | ' | 4,809,282 | ' |
Net income / (loss) | ' | 690,510,763 | ' | ' | ' | ' | 714,405,864 | ' | 714,405,864 | -23,895,101 |
Disposal of a stake of shares of a subsidiary | ' | 20,252,405 | ' | 17,577,884 | ' | ' | ' | ' | 17,577,884 | 2,674,521 |
Issuance of convertible preferred shares by a subsidiary | ' | 67,243,193 | ' | ' | ' | ' | ' | ' | ' | 67,243,193 |
Acquisition of a subsidiary | ' | 12,000,000 | ' | ' | ' | ' | ' | ' | ' | 12,000,000 |
Acquisition of additional stake in subsidiaries | ' | -79,476,721 | ' | -13,930,677 | ' | ' | ' | ' | -13,930,677 | -65,546,044 |
Balance at Dec. 31, 2012 | ' | 6,584,879,613 | 2,979,144 | 3,818,256,227 | 103,222,512 | -58,778,675 | 4,515,841,767 | -1,891,888,900 | 6,489,632,075 | 95,247,538 |
Balance (in shares) at Dec. 31, 2012 | ' | ' | 32,354,634 | ' | ' | ' | ' | ' | ' | ' |
Changes in shareholders' equity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Issuance of common stock pursuant to share incentive plan | ' | 194,196,523 | 54,346 | 194,142,177 | ' | ' | ' | ' | 194,196,523 | ' |
Issuance of common stock pursuant to share incentive plan (in shares) | ' | ' | 885,398 | ' | ' | ' | ' | ' | ' | ' |
Exercise of share option (in shares) | 660,459 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based compensation | ' | 440,992,258 | ' | 440,992,258 | ' | ' | ' | ' | 440,992,258 | ' |
Appropriations to statutory reserves | ' | ' | ' | ' | 15,226,718 | ' | -15,226,718 | ' | ' | ' |
Foreign currency translation adjustments | -2,340,309 | -14,167,524 | ' | ' | ' | -14,167,524 | ' | ' | -14,167,524 | ' |
Unrealized securities holding gains (losses) | 73,604,700 | 445,580,779 | ' | ' | ' | 445,580,779 | ' | ' | 445,580,779 | ' |
Purchasing of Purchased Call Option | ' | -842,694,944 | ' | -842,694,944 | ' | ' | ' | ' | -842,694,944 | ' |
Sale of Issued Warrants | ' | 470,838,904 | ' | 470,838,904 | ' | ' | ' | ' | 470,838,904 | ' |
Early Termination of Call Option | ' | 70,270,919 | ' | 70,270,919 | ' | ' | ' | ' | 70,270,919 | ' |
Early Conversion of Convertible Notes | ' | 277,459,000 | ' | -63,288,632 | ' | ' | ' | 340,747,632 | 277,459,000 | ' |
Early Conversion of Convertible Notes (in shares) | ' | ' | 588,219 | ' | ' | ' | ' | -588,219 | ' | ' |
Net income / (loss) | 149,727,042 | 906,402,585 | ' | ' | ' | ' | 998,319,684 | ' | 998,319,684 | -91,917,099 |
Issuance of convertible preferred shares by a subsidiary | ' | 132,709,989 | ' | ' | ' | ' | ' | ' | ' | 132,709,989 |
Acquisition of a subsidiary | ' | 63,700,000 | ' | ' | ' | ' | ' | ' | ' | 63,700,000 |
Acquisition of additional stake in subsidiaries | ' | -82,143 | ' | -32,143 | ' | ' | ' | ' | -32,143 | -50,000 |
Balance at Dec. 31, 2013 | $1,442,107,465 | 8,730,085,959 | 3,033,490 | 4,088,484,766 | 118,449,230 | 372,634,580 | 5,498,934,733 | -1,551,141,268 | 8,530,395,531 | 199,690,428 |
Balance (in shares) at Dec. 31, 2013 | ' | ' | 33,828,251 | ' | ' | ' | ' | ' | ' | ' |
CONSOLIDATED_STATEMENTS_OF_SHA1
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Parenthetical) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY | ' | ' |
Ordinary shares (in dollars per share) | $0.01 | $0.01 |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS | 12 Months Ended | |||
Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
USD ($) | CNY | CNY | CNY | |
Cash flows from operating activities: | ' | ' | ' | ' |
Net income | $149,727,042 | 906,402,585 | 690,510,763 | 1,084,960,155 |
Adjustments to reconcile net income to cash provided by operating activities: | ' | ' | ' | ' |
Share-based compensation | 72,340,796 | 437,929,477 | 431,721,322 | 342,791,357 |
Equity in income of affiliates | -9,176,879 | -55,554,072 | -34,343,000 | -57,525,830 |
Gain on deconsolidation of subsidiaries | ' | ' | -44,432,052 | ' |
Loss from disposal of property, equipment and software | 1,973,412 | 11,946,443 | 653,191 | 3,379,449 |
Gain on disposal of cost method investment | -663,203 | -4,014,829 | ' | ' |
Gain on disposal of equity investment | -97,914 | -592,742 | ' | ' |
Provision for doubtful accounts | 469,577 | 2,842,681 | 376,164 | 185,443 |
Depreciation of property, equipment and software | 18,252,462 | 110,494,928 | 88,462,807 | 78,809,867 |
Amortization of intangible assets and land use rights | 1,742,051 | 10,545,854 | 10,538,382 | 11,066,656 |
Deferred income tax benefit | -5,925,628 | -35,871,972 | -22,757,864 | -3,388,535 |
Changes in current assets and liabilities net of assets acquired and liabilities assumed in business combinations : | ' | ' | ' | ' |
Increase in accounts receivable | -80,520,385 | -487,446,257 | -193,874,838 | -166,668,439 |
Decrease in due from related parties | -2,042,249 | -12,363,165 | -333,610 | -1,732,887 |
Increase in prepayments and other current assets | -65,747,536 | -398,015,862 | -118,239,096 | -203,694,403 |
Decrease (Increase) in long-term deposits | 3,205,666 | 19,406,141 | -7,479,664 | 496,130 |
Increase in accounts payable | 88,816,672 | 537,669,487 | 255,160,851 | 166,395,703 |
(Increase) Decrease in due to related parties | 96,343 | 583,234 | 1,677,658 | -5,025,904 |
(Increase) Decrease in salary and welfare payable | 4,248,733 | 25,720,555 | 85,511,674 | -14,021,957 |
Increase (Decrease) in taxes payable | 16,192,715 | 98,025,837 | -3,054,768 | 60,282,019 |
Increase in advances from customers | 165,471,865 | 1,001,717,032 | 310,497,590 | 487,010,431 |
Increase in accrued liability for customer reward program | 11,087,563 | 67,120,782 | 55,805,114 | 40,519,230 |
Increase in other payables and accruals | 35,727,112 | 216,281,215 | 147,967,182 | 27,476,422 |
Net cash provided by operating activities | 405,178,215 | 2,452,827,352 | 1,654,367,806 | 1,851,314,907 |
Cash flows from investing activities: | ' | ' | ' | ' |
Purchase of property, equipment and software | -107,663,944 | -651,765,217 | -543,123,309 | -205,212,492 |
Cash paid for long-term investments | -159,476,254 | -965,421,399 | ' | -5,100,000 |
Cash paid for acquisition, net of cash acquired | -19,779,574 | -119,739,607 | -29,018,885 | -27,532,356 |
Purchase of intangible assets | ' | ' | ' | -3,233,850 |
Purchase of land use rights | ' | ' | ' | -9,747,800 |
Decrease (Increase) in restricted cash | 5,278,493 | 31,954,414 | -558,620,548 | 5,527,208 |
Increase in short-term investment | -366,708,074 | -2,219,940,665 | -123,698,692 | -94,647,972 |
Increase in long-term loan receivable | -29,499,992 | -178,584,102 | ' | ' |
Cash received from disposal of equity investment | 695,430 | 4,209,926 | ' | ' |
Cash received from disposal of cost method investment | 2,171,056 | 13,142,920 | ' | ' |
Cash received from disposal of a subsidiary | ' | ' | 14,556,966 | ' |
Net cash used in investing activities | -674,982,859 | -4,086,143,730 | -1,239,904,468 | -339,947,262 |
Cash flows from financing activities: | ' | ' | ' | ' |
Proceeds from short-term bank loan | 53,045,363 | 321,120,713 | 453,478,628 | ' |
Proceeds from exercise of share option | 29,777,011 | 180,261,090 | 81,911,154 | 54,416,536 |
Repurchase of common stock | ' | ' | -1,733,127,675 | -158,761,225 |
Cash paid to non-controlling investors | -13,569 | -82,143 | -40,289,731 | -10,404,359 |
Proceeds from issuance convertible preferred shares by a subsidiary | 21,922,128 | 132,709,989 | 63,709,828 | ' |
Proceeds from issuance of senior convertible notes, net of issuance costs | 780,268,550 | 4,723,511,720 | 1,097,195,400 | ' |
Proceeds from sale of warrants | 77,777,046 | 470,838,904 | 167,503,950 | ' |
Purchase of Purchased Call Option | -139,203,288 | -842,694,944 | -346,009,222 | ' |
Cash (outflow) inflow for Capped equity | 43,732,781 | 264,745,135 | -259,935,853 | ' |
Early Termination of Call Option | 11,607,929 | 70,270,919 | ' | ' |
Convertible Notes early conversion | -777,445 | -4,706,419 | ' | ' |
Net cash (used in) provided by financing activities | 878,136,506 | 5,315,974,964 | -515,563,521 | -114,749,048 |
Effect of foreign exchange rate changes on cash and cash equivalents | 5,641,717 | 34,153,266 | 19,204,727 | -47,125,290 |
Net increase (decrease) in cash and cash equivalents | 613,973,579 | 3,716,811,852 | -81,895,456 | 1,349,493,307 |
Cash and cash equivalents, beginning of year | 565,196,980 | 3,421,532,962 | 3,503,428,418 | 2,153,935,111 |
Cash and cash equivalents, end of year | 1,179,170,559 | 7,138,344,814 | 3,421,532,962 | 3,503,428,418 |
Supplemental disclosure of cash flow information | ' | ' | ' | ' |
Cash paid during the year for income taxes | 44,845,662 | 271,482,184 | 350,444,946 | 197,700,444 |
Cash paid for interest, net of amounts capitalized | 3,184,217 | 19,276,294 | 3,364,678 | ' |
Supplemental schedule of non-cash investing and financing activities | ' | ' | ' | ' |
Receivables incurred for disposal of investment | 2,023,556 | 12,250,000 | ' | ' |
Accruals related to purchase of property, equipment and software | -6,118,357 | -37,038,698 | -34,450,253 | -32,195,338 |
Liabilities incurred for acquisitions and investments | ($3,927,056) | -23,773,221 | -19,742,776 | -10,750,000 |
ORGANIZATION_AND_NATURE_OF_OPE
ORGANIZATION AND NATURE OF OPERATIONS | 12 Months Ended |
Dec. 31, 2013 | |
ORGANIZATION AND NATURE OF OPERATIONS | ' |
ORGANIZATION AND NATURE OF OPERATIONS | ' |
1. ORGANIZATION AND NATURE OF OPERATIONS | |
The accompanying consolidated financial statements include the financial statements of Ctrip.com International, Ltd. (the “Company”), its subsidiaries, VIEs and VIEs’ subsidiaries. The Company, its subsidiaries, the consolidated VIEs and their subsidiaries are collectively referred to as the “Group”. | |
The Group is principally engaged in the provision of travel related services including hotel reservation, ticketing services, packaged-tour, corporate travel management services, as well as, to a much lesser extent, Internet-related advertising and other related services. |
PRINCIPAL_ACCOUNTING_POLICIES
PRINCIPAL ACCOUNTING POLICIES | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
PRINCIPAL ACCOUNTING POLICIES | ' | |||||||||||||
PRINCIPAL ACCOUNTING POLICIES | ' | |||||||||||||
2. PRINCIPAL ACCOUNTING POLICIES | ||||||||||||||
Basis of presentation | ||||||||||||||
The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“US GAAP”). | ||||||||||||||
The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the balance sheet dates and the reported amounts of revenues and expenses during the reporting periods. Actual results could materially differ from those estimates. | ||||||||||||||
Consolidation | ||||||||||||||
The consolidated financial statements include the financial statements of the Company, its subsidiaries, VIEs and VIEs’ subsidiaries. All significant transactions and balances between the Company, its subsidiaries, VIEs and VIEs’ subsidiaries have been eliminated upon consolidation. | ||||||||||||||
A subsidiary is an entity in which the Company, directly or indirectly, controls more than one half of the voting power; has the power to appoint or remove the majority of the members of the board of directors; to cast a majority of votes at the meeting of the board of directors or to govern the financial and operating policies of the investee under a statute or agreement among the shareholders or equity holders. | ||||||||||||||
The Company has adopted the guidance codified in Accounting Standard Codification 810, Consolidations (“ASC 810”) on accounting for VIEs and their respective subsidiaries, which requires certain variable interest entities to be consolidated by the primary beneficiary of the entity in which it has a controlling financial interest. A VIE is an entity with one or more of the following characteristics: (a) the total equity investment at risk is not sufficient to permit the entity to finance its activities without additional financial support; (b) as a group, the holders of the equity investment at risk lack the ability to make certain decisions, the obligation to absorb expected losses or the right to receive expected residual returns, or (c) an equity investor has voting rights that are disproportionate to its economic interest and substantially all of the entity’s activities are on behalf of the investor. Accordingly, the financial statements of the following VIEs and VIEs’ subsidiaries are consolidated into the Company’s financial statements since July 1, 2003 or their respective date of establishment/acquisition, whichever is later: | ||||||||||||||
The following is a summary of the Company’s major VIEs and VIEs’ subsidiaries: | ||||||||||||||
Name of VIE and VIEs’ subsidiaries | Date of establishment/acquisition | |||||||||||||
Shanghai Ctrip Commerce Co., Ltd. (“Shanghai Ctrip Commerce”) | Established on July 18, 2000 | |||||||||||||
Beijing Ctrip International Travel Agency Co., Ltd. (“Beijing Ctrip”) | Acquired on January 15, 2002 | |||||||||||||
Guangzhou Ctrip International Travel Agency Co., Ltd. (“Guangzhou Ctrip”) | Established on April 28, 2003 | |||||||||||||
Shanghai Ctrip International Travel Agency Co., Ltd. (“Shanghai Ctrip” formerly Shanghai Ctrip Charming International Travel Agency Co., Ltd.) | Acquired on September 23, 2003 | |||||||||||||
Shenzhen Ctrip Travel Agency Co., Ltd. (“Shenzhen Ctrip”) | Established on April 13, 2004 | |||||||||||||
Ctrip Insurance Agency Co., Ltd. (“Ctrip Insurance”) | Established on July 25, 2011 | |||||||||||||
Shanghai Huacheng Southwest Travel Agency Co., Ltd. (“Shanghai Huacheng”) | Established on March 13, 2001 | |||||||||||||
Chengdu Ctrip Travel Agency Co., Ltd. (“Chengdu Ctrip”) | Established on January 8, 2007 | |||||||||||||
Chengdu Ctrip International Travel Agency Co., Ltd. (“Chengdu Ctrip International”) | Established on November 4, 2008 | |||||||||||||
For the years ended December 31, 2011, 2012 and 2013, the Company is considered the primary beneficiary of a VIE or VIEs’ subsidiary and consolidated the VIE or VIEs’ subsidiary if the Company had variable interests, that will absorb the entity’s expected losses, receive the entity’s expected residual returns, or both. | ||||||||||||||
In December 2009, the FASB issued Consolidations—Improvements to Financial Reporting by Enterprises Involved with VIEs which replaced the quantitative-based risks and rewards calculation for determining which reporting entity, if any, has a controlling financial interest in a variable interest entity with an approach focused on identifying which reporting entity has 1) the power to direct the activities of a variable interest entity that most significantly impact the entity’s economic performance and 2) the obligation to absorb losses from or the right to receive benefits of the variable interest entity that could potentially be significant to the VIE. The Company adopted the new requirements effective January 1, 2010 and the adoption did not have a material impact on the Company’s consolidated financial statements for the year ended December 31, 2011, 2012 and 2013. | ||||||||||||||
Major variable interest entities and their subsidiaries | ||||||||||||||
As of December 31, 2013, the Company conducts a part of its operations through a series of agreements with certain VIEs and VIEs’ subsidiaries as stated in above. These VIEs and VIEs’ subsidiaries are used solely to facilitate the Group’s participation in Internet content provision, advertising business, travel agency and air-ticketing services in the People’s Republic of China (“PRC”) where foreign ownership is restricted. | ||||||||||||||
Shanghai Ctrip Commerce is a domestic company incorporated in Shanghai, the PRC. Shanghai Ctrip Commerce holds a value-added telecommunications business license and is primarily engaged in the provision of advertising business on the Internet website. Two senior officers of the Company collectively hold 100% of the equity interest in Shanghai Ctrip Commerce. The registered capital of Shanghai Ctrip Commerce was RMB30,000,000 as of December 31, 2013. | ||||||||||||||
Beijing Ctrip is a domestic company incorporated in Beijing, the PRC. Beijing Ctrip holds an air transport sales agency license, domestic and cross-border travel agency license and is mainly engaged in the provision of air-ticketing services and packaged tour services. A senior officer of the Company and Shanghai Ctrip Commerce collectively hold 100% of the equity interest in Beijing Ctrip. The registered capital of Beijing Ctrip was RMB40,000,000 as of December 31, 2013. | ||||||||||||||
Guangzhou Ctrip is a domestic company incorporated in Guangzhou, the PRC. Guangzhou Ctrip holds air transport sales agency license, domestic and cross-border travel agency license and is mainly engaged in the provision of air-ticketing services and packaged tour services. Two senior officers of the Company collectively hold 100% of the equity interest in Guangzhou Ctrip. The registered capital of Guangzhou Ctrip was RMB3,000,000 as of December 31, 2013. | ||||||||||||||
Shanghai Ctrip is a domestic company incorporated in Shanghai, the PRC. Shanghai Ctrip holds domestic and cross-border travel agency licenses, air transport sales agency license and mainly provides domestic and cross-border tour services. In September 2012, the Company purchased of the ownership interests from the unrelated minority shareholder and effected a simultaneous reduction of capital of Shanghai Ctrip. Upon completion of the above transactions, a senior officer of the Company control 100% of the equity interest in Shanghai Ctrip. The registered capital of Shanghai Ctrip was RMB10,000,000 as of December 31, 2013. | ||||||||||||||
Shenzhen Ctrip is a domestic company incorporated in Shenzhen, the PRC. Shenzhen Ctrip holds air transport sales | ||||||||||||||
agency license and domestic travel agency license and is engaged in the provision of air-ticketing service. Two senior officers of the Company collectively hold 100% of the equity interest in Shenzhen Ctrip. The registered capital of Shenzhen Ctrip was RMB2,500,000 as of December 31, 2013. | ||||||||||||||
Ctrip Insurance is an insurance agency incorporated in Shanghai, the PRC. Ctrip Insurance was established in July 2011. Ctrip Insurance holds an insurance agency business license. Shanghai Ctrip Commerce and Ctrip Computer Technology (Shanghai) Co., Ltd. (“Ctrip Computer Technology”) hold 100% of the equity interest in Ctrip Insurance. The registered capital of Ctrip Insurance was RMB50,000,000 as of December 31, 2013. | ||||||||||||||
Shanghai Huacheng is a domestic company incorporated in Shanghai, the PRC. Shanghai Huacheng holds a domestic travel agency license and an air transport sales agency license and mainly provides domestic tour services and air-ticketing services. Shanghai Ctrip Commerce holds 100% of the equity interest in Shanghai Huacheng. The registered capital of Shanghai Huacheng was RMB69,950,000 as of December 31, 2013. | ||||||||||||||
Chengdu Ctrip is a domestic company incorporated in Chengdu, the PRC. Chengdu Ctrip holds air transport sales agency license and domestic travel agency license and is engaged in the provision of air-ticketing service. Shanghai Ctrip holds 100% of the equity interest in Chengdu Ctrip. The registered capital of Chengdu Ctrip was RMB11,500,000 as of December 31, 2013. | ||||||||||||||
Chengdu Ctrip International is a domestic company incorporated in Chengdu, the PRC. Chengdu Ctrip International holds domestic and cross-border travel agency licenses, air transport sales agency license and mainly provides domestic and cross-border tour services. Shanghai Ctrip holds 100% of the equity interest in Chengdu Ctrip International. The registered capital of Chengdu Ctrip International was RMB2,000,000 as of December 31, 2013. | ||||||||||||||
The capital injected by senior officers or senior officer’s family member are funded by the Company and are recorded as long-term business loans to related parties. The Company does not have any ownership interest in these VIEs and VIEs’ subsidiaries. | ||||||||||||||
As of December 31, 2013, the Company has various agreements with its consolidated VIEs and VIEs’ subsidiaries, including loan agreements, exclusive technical consulting and services agreements, share pledge agreements, exclusive option agreements and other operating agreements. | ||||||||||||||
Details of certain key agreements with the VIEs are as follows: | ||||||||||||||
Powers of Attorney: Each of the shareholders of our affiliated Chinese entities signed an irrevocable power of attorney to appoint Ctrip Computer Technology (Shanghai) Co., Ltd. or another wholly owned subsidiary of ours, as attorney-in-fact to vote, by itself or any other person to be designated at its discretion, on all matters of our affiliated Chinese entities. Each power of attorney will remain effective during the existence of the applicable affiliated Chinese entity. The Power of Attorney shall remain effective as long as the applicable affiliated Chinese entity exists, and the shareholders of our affiliated Chinese entities are not entitled to terminate or amend the terms of the Power of Attorneys without prior written consent from us. | ||||||||||||||
Amended and Restated Technical Consulting and Services Agreement: Ctrip Computer Technology, Ctrip Travel Network and Ctrip Travel Information provide our affiliated Chinese entities with technical consulting and related services and staff training and information services. We also maintain their network platforms. In consideration for our services, our affiliated Chinese entities agree to pay us service fees as calculated in such manner as determined by us from time to time based on the nature of service, which may be adjusted periodically. For 2013, our affiliated Chinese entities paid Ctrip Computer Technology and Ctrip Travel Network a quarterly fee based on the number of air tickets sold and the number of packaged-tour products sold in the quarter, at an average rate from RMB8 (US$1) to RMB85 (US$14) per ticket and from RMB27 (US$4) to RMB125 (US$21) per person per tour. Although the service fees are typically determined based on the number of air tickets sold and packaged tour products sold, given the fact that the nominee shareholders of our affiliated Chinese entities have irrevocably appointed the employees of our subsidiaries to vote on their behalf on all matters they are entitled to vote on, we have the right to determine the level of service fees paid and therefore receive substantially all of the economic benefits of our affiliated Chinese entities in the form of service fees. The services fees paid by all of our affiliated Chinese entities as a percentage of their total net income were 77.7%, 82.7% and 105.9% for the years ended December 31, 2011, 2012 and 2013. The initial term of these agreements is 10 years and may be renewed automatically in 10-year terms unless we disapprove the extension. We retain the exclusive right to terminate the agreements at any time by delivering a 30-day advance written notice to the applicable affiliate Chinese entity. | ||||||||||||||
Amended and Restated Share Pledge Agreements: The shareholders of our affiliated Chinese entities have pledged their respective equity interests in our affiliated Chinese entities as a guarantee for the performance of all the obligations under the other contractual arrangements, including payment by our affiliated Chinese entities of the technical and consulting services fees to us under the amended and restated technical consulting and services agreements, repayment of the business loan under the amended and restated business loan agreements and performance of obligations under the amended and restated exclusive option agreements, each agreement as described herein. In the event any of our affiliated Chinese entity breaches any of its obligations or any shareholder of our affiliated Chinese entities breaches his/her obligations, as the case may be, under these agreements, we are entitled | ||||||||||||||
to enforce the equity pledge right and sell or otherwise dispose of the pledged equity interests, and retain the proceeds from such sale or require any of them to transfer his or her equity interest without consideration to the PRC citizen(s) designated by us. These amended and restated share pledge agreements came into effect on the day when the respective pledgors became shareholders of our affiliated Chinese entities, and shall expire two years after the pledgor and the affiliated Chinese entities no longer undertake any obligations under the above-referenced agreements. | ||||||||||||||
Amended and Restated Business Loan Arrangements: Under the amended and restated business loan agreements we entered into with the shareholders of our affiliated Chinese entities, we extended long-term business loans to these shareholders of our affiliated Chinese entities with the sole purpose of providing funds necessary for the capitalization or acquisition of our affiliated Chinese entities. These loan amounts were injected into the affiliated Chinese entities as capitals and cannot be accessed for any personal uses. The amended and restated business loan agreements shall remain effective until the parties have fully performed their respective obligations under the agreement, and the shareholders of our affiliated Chinese entities have no right to unilaterally terminate these agreements. In the event that the PRC government lifts its substantial restrictions on foreign ownership of the air-ticketing, travel agency, or value-added telecommunications business in China, as applicable, we will exercise our exclusive option to purchase all of the outstanding equity interests of our affiliated Chinese entities, as described in the following paragraph, and the amended and restated business loan agreements will be cancelled in connection with such purchase. However, it is uncertain when, if at all, the PRC government will lift any or all of these restrictions. | ||||||||||||||
Amended and Restated Exclusive Option Agreements: As consideration for our entering into the amended and restated business loan agreements described above, each of the shareholders of our affiliated Chinese entities has granted us an exclusive, irrevocable option to purchase, or designate one or more person(s) at our discretion to purchase, all of their equity interests in our affiliated Chinese entities at any time we desire, subject to compliance with the applicable PRC laws and regulations. We may exercise the option by issuing a written notice to the relevant affiliated Chinese entity. The purchase price shall be equal to the contribution actually made by the shareholder for the relevant equity interest. Therefore, if we exercise these options, we may choose to cancel the outstanding loans we extended to the shareholders of our affiliated Chinese entities pursuant to the amended and restated business loan agreements as the loans were used solely for equity contribution purposes. The initial term of these agreements is 10 years and may be renewed automatically in 10-year terms unless we disapprove the extension. We retain the exclusive right to terminate the agreements at any time by delivering a written notice to the applicable affiliate Chinese entity. | ||||||||||||||
The affiliated Chinese entities and their shareholders agree not to enter into any transaction that would affect the assets, obligations, rights or operations of the affiliated Chinese entities without the Company’s prior written consent. They also agree to accept the Company’s guidance with respect to day-to-day operations, financial management systems and the appointment and dismissal of key employees. | ||||||||||||||
In addition, the Company also enters into amended and restated technical consulting and services agreements with its majority or wholly owned subsidiaries of the affiliated Chinese entities, such as Chengdu Ctrip and Chengdu Ctrip International, and these subsidiaries pay the Company service fees based on the level of services provided. The existence of such amended and restated technical consulting and services agreements provides the Company with the enhanced ability to transfer economic benefits of these majority or wholly owned subsidiaries of the affiliated Chinese entities to us in exchange for the services provided, and this is in addition to the Company’s existing ability to consolidate and extract the economic benefits of these majority or wholly owned subsidiaries of the affiliated Chinese entities (for instance, the affiliated Chinese entities may cause the economic benefits to be channeled to them in the form of dividends, which then may be further consolidated and absorbed by the Company through the contractual arrangements described above). | ||||||||||||||
Risks in relation to contractual arrangements between the Company’s PRC subsidiaries and its affiliated Chinese entities: | ||||||||||||||
The Company has been advised by Commerce & Finance Law Offices, its PRC legal counsel, that its contractual arrangements with its consolidated VIEs as described in the Company’s annual report are valid, binding and enforceable under the current laws and regulations of China. Based on such legal opinion and the management’s knowledge and experience, the Company believes that its contractual arrangements with its consolidated VIEs are in compliance with current PRC laws and legally enforceable. However, there may be in the event that the affiliated Chinese entities and their respective shareholders fail to perform their contractual obligations, the Company may have to rely on the PRC legal system to enforce its rights. The PRC legal system is based on written statutes. Prior court decisions may be cited for reference but have limited precedential value. Since 1979, PRC legislation and regulations have significantly enhanced the protections afforded to various forms of foreign investments in China. However, since the PRC legal system is still evolving, the interpretations of many laws, regulations and rules are not always uniform and enforcement of these laws, regulations and rules involve uncertainties, which may limit remedies available to us. In addition, any litigation in China may be protracted and result in substantial costs and diversion of resources and management attention. Due to the uncertainties with respect to the PRC legal system, the PRC government authorities may ultimately take a view contrary to the opinion of its PRC legal counsel with respect to the enforceability of the contractual arrangements. | ||||||||||||||
There are, however, substantial uncertainties regarding the interpretation and application of current or future PRC laws and regulations. Accordingly, the Company cannot be assured that the PRC government authorities will not ultimately take a view that is contrary to the Company’s belief and the opinion of its PRC legal counsel. If the contractual arrangements establishing the Company’s VIE structure are found to be in violation of any existing or future PRC laws or regulations, the relevant PRC government authorities will have broad discretion in dealing with such violation, including, without limitation, levying fines, confiscating our income or the income of our affiliated Chinese entities, revoking our business licenses or the business licenses of our affiliated Chinese entities, requiring us and our affiliated Chinese entities to restructure our ownership structure or operations and requiring us or our affiliated Chinese entities to discontinue any portion or all of our value-added telecommunications, air-ticketing, travel agency or advertising businesses. If the imposing of these penalties cause the Company to lose its rights to direct the activities of and receive economic benefits from its VIEs, which in turn may restrict the Company’s ability to consolidate and reflect in its financial statements the financial position and results of operations of its VIEs. | ||||||||||||||
Summary financial information of the Group’s VIEs in the consolidated financial statements | ||||||||||||||
Pursuant to the contractual arrangements with the VIEs, the Company has the power to direct activities of the VIEs, and can have assets transferred freely out of the VIEs without any restrictions. Therefore the Company considers that there is no asset of a consolidated VIE that can be used only to settle obligations of the VIE, except for registered capital and PRC statutory reserves of the VIEs amounting to a total of RMB444 million as of December 31, 2013. As all the consolidated VIEs are incorporated as limited liability companies under the PRC Company Law, creditors of the VIEs do not have recourse to the general credit of the Company for any of the liabilities of the consolidated VIEs. | ||||||||||||||
Summary financial information of the VIEs, which represents consolidated financial information of the VIEs and their respective subsidiaries included in the accompanying consolidated financial statements, is as follows: | ||||||||||||||
As of December 31, | ||||||||||||||
2012 | 2013 | |||||||||||||
RMB | RMB | |||||||||||||
Total assets | 3,724,911,506 | 5,982,258,881 | ||||||||||||
Less: Inter-company receivables | (542,006,382 | ) | (373,041,663 | ) | ||||||||||
Total assets excluding inter-company | 3,182,905,124 | 5,609,217,218 | ||||||||||||
Total liabilities | 2,835,938,149 | 5,287,287,035 | ||||||||||||
Less: Inter-company payables | (564,890,117 | ) | (1,442,636,737 | ) | ||||||||||
Total liabilities excluding inter-company | 2,271,048,032 | 3,844,650,298 | ||||||||||||
As of December 31, 2012 and 2013, the VIEs’ assets mainly consisted of cash and cash equivalent (December 31, 2012: RMB1.4 billion, December 31, 2013: RMB 1.5 billion), short-term investment (December 31, 2012: RMB118 million, December 31, 2013: RMB 1.6 billion), accounts receivables (December 31, 2012: RMB754 million, December 31, 2013: RMB1.1 billion), and prepayments and other current assets (December 31, 2012: RMB534 million, December 31, 2013: RMB912 million). The inter-company receivables of RMB542 million and RMB373 million as of December 31, 2012 and 2013 mainly represented the cash paid by a VIE to one of the Company’s WFOEs for treasury cash management purpose. | ||||||||||||||
As of December 31, 2012 and 2013, the VIEs’ liabilities mainly consisted of advance from customers (December 31, 2012: RMB1.2 billion, December 31, 2013: RMB2.1 billion), accounts payable (December 31, 2012: RMB792 million, December 31, 2013: RMB1.3 billion), taxes payable (December 31, 2012: RMB66 million, December 31, 2013: RMB46 million), salary and welfare payable (December 31, 2012: RMB78 million, December 31, 2013: RMB119 million), other payables and accruals (December 31, 2012: RMB79 million, December 31, 2013: RMB181 million). The inter-company payables as of December 31, 2012 and 2013 were RMB565 million and RMB1.4 billion, respectively, which primarily consisted of the payables due to Ctrip.com (Hong Kong) Limited (“Ctrip HK”), one of the Company’s wholly-owned subsidiaries, for its payment of overseas air tickets and tour packages on behalf of a VIE and another VIEs’ subsidiary and the service fees payable to the WFOEs under the technical consulting and services agreements, which are operational in nature from the VIEs and their subsidiaries’ perspectives. | ||||||||||||||
For the year ended December 31, | ||||||||||||||
2011 | 2012 | 2013 | ||||||||||||
RMB | RMB | RMB | ||||||||||||
Net revenues | 1,923,643,591 | 2,465,286,325 | 3,137,211,893 | |||||||||||
Cost of revenues | 461,223,883 | 644,886,101 | 904,328,902 | |||||||||||
Net income/ (loss) | 206,213,884 | 198,929,052 | (74,463,933 | ) | ||||||||||
As aforementioned, the VIEs mainly conduct air-ticketing, travel agency, advertising and value-added telecommunication businesses. Revenues from VIEs accounted for around 58% of the Company’s total revenues in 2013. The air-ticketing and packaged-tour revenues continued to increase in 2013, primarily driven by the increase in the air-ticketing volume and leisure travel volume. | ||||||||||||||
The VIEs’ net income before the deduction of the inter-company consulting fee charges were RMB956 million, RMB1.1 billion and RMB1.3 billion for the years ended December 31, 2011, 2012 and 2013, respectively. | ||||||||||||||
The amount of service fees paid by all the VIEs as a percentage of the VIEs’ total net income were 77.7%, 82.7%and 105.9% for the years ended December 31, 2011, 2012 and 2013, respectively. | ||||||||||||||
The WFOEs are the sole and exclusive provider of technical consulting and related services and information services for the VIEs. Pursuant to the Exclusive Technical Consulting and Service Agreements, the VIEs pay service fees to the WFOEs based on the VIEs’ actual operating results. The WFOEs are entitled to receive substantially all of the net income and transfer a majority of the economic benefits in the form of service fees from the VIEs and VIEs’ subsidiaries to the WFOEs. The WFOEs did not request service fee payments of RMB201 million, RMB286 million from Chengdu Ctrip and Chengdu Ctrip International during the years ended December 31, 2011 and 2012, respectively, primarily for tax planning purpose. In 2013, Chengdu Ctrip and Chengdu Ctrip International started to pay service fee to WFOEs and the retained earnings of 2013 have been transferred to the WFOEs. For the undistributed earnings of 2011 and 2012, tax planning strategies are in place to support their enterprise income tax free treatment. | ||||||||||||||
Currently there is no contractual arrangement that could require the Company to provide additional financial support to the consolidated VIEs. As the Company is conducting certain business in the PRC mainly through the VIEs, the Company may provide such support on a discretionary basis in the future, which could expose the Company to a loss. | ||||||||||||||
Foreign currencies | ||||||||||||||
The Group’s reporting currency is RMB. The Company’s operations are conducted through the subsidiaries and VIEs where the local currency is the functional currency and the financial statements of those subsidiaries are translated from their respective functional currencies into RMB. | ||||||||||||||
Transactions denominated in currencies other than functional currencies are translated at the exchange rates quoted by the People’s Bank of China (the “PBOC”), the Hong Kong Association of Banks (the “HKAB”) or major Taiwan banks, prevailing or averaged at the dates of the transaction for PRC and Hong Kong subsidiaries and ezTravel respectively. Gains and losses resulting from foreign currency transactions are included in the consolidated statements of income and comprehensive income. Monetary assets and liabilities denominated in foreign currencies are translated using the applicable exchange rates quoted by the PBOC, HKAB or banks located in Taiwan at the balance sheet dates. All such exchange gains and losses are included in the statements of income. | ||||||||||||||
Assets and liabilities of the group companies are translated from their respective functional currencies to the reporting currency at the exchange rates at the balance sheet dates, equity accounts are translated at historical exchange rates and revenues and expenses are translated at the average exchange rates in effect during the reporting period. The exchange differences for the translation of group companies with non-RMB functional currency into the RMB functional currency are included in foreign currency translation adjustments, which is a separate component of shareholders’ equity on the consolidated financial statements. | ||||||||||||||
Translations of amounts from RMB into US$ are solely for the convenience of the reader and were calculated at the rate of US$1.00 =MB6.0537 on December 31, 2013, representing the certificated exchange rate published by the Federal Reserve Board. No representation is intended to imply that the RMB amounts could have been, or could be, converted, realized or settled into US$ at that rate on December 31, 2013, or at any other rate. | ||||||||||||||
Cashand cash equivalents | ||||||||||||||
Cash includes currency on hand and deposits held by financial institutions that can be added to or withdrawn without limitation. Cash equivalents represent short-term, highly liquid investments that are readily convertible to known amounts of cash and with original maturities from the date of purchase of generally three months or less. | ||||||||||||||
Restricted cash | ||||||||||||||
Restricted cash represents cash that cannot be withdrawn without the permission of third parties. The Group’s restricted cash is substantially cash balance on deposit required by its business partners and commercial banks. | ||||||||||||||
Short-term investment | ||||||||||||||
Short-term investments represent the investments issued by commercial banks or other financial institutions with a variable interest rate indexed to the performance of underlying assets within one year. The Company elected the fair value method at the date of initial recognition and carried these investments subsequently at fair value. Changes in the fair value are reflected in the consolidated statements of income and comprehensive income. | ||||||||||||||
Long term loan receivable | ||||||||||||||
Long-term loan receivables are recorded at cost and compounded accrued interests as we do not intend to sell the security, or it is more likely than not that the company will not be required to sell the security before full recovery of our cost. The company evaluates the qualitative criteria to determine whether we expect to recover our cost. | ||||||||||||||
Land use rights | ||||||||||||||
Land use rights represent the prepayments for usage of the parcels of land where the office buildings are located, are recorded at cost, and are amortized over their respective lease periods (usually over 40 to 50 years). | ||||||||||||||
Property, equipment and software | ||||||||||||||
Property, equipment and software are stated at cost less accumulated depreciation and amortization. Depreciation and amortization are computed using the straight-line method over the following estimated useful lives, taking into account any estimated residual value: | ||||||||||||||
Building | 20-30 years | |||||||||||||
Leasehold improvements | Lesser of the term of the lease or the estimated useful lives of the assets | |||||||||||||
Website-related equipment | 5 years | |||||||||||||
Computer equipment | 3-5 years | |||||||||||||
Furniture and fixtures | 3-5 years | |||||||||||||
Software | 3-5 years | |||||||||||||
Construction in progress is stated at cost. Construction in progress mainly refers to costs associated with the information and technology center in Chengdu before the buildings are put into service. All direct costs related to the new buildings are capitalized as construction in progress until it is substantially completed and available for use. | ||||||||||||||
Investments | ||||||||||||||
The Company investments include cost method investment, equity method investments and available-for-sale investments in certain publicly traded companies and privately-held companies. | ||||||||||||||
Cost method is used for investments over which the Company does not have the ability to exercise significant influence. Gain or losses are realized when such investments are sold or when dividends are declared or payments are recognized. In October, 2013, the company contributed 5% equity shares in Zhong An Online Property Insurance Co., Ltd. In December 2013, the Company acquired approximately 4% equity shares in Keystone Lodging Holdings Limited (“Keystone”), which in 2013 merged with 7 Days Group Holdings Limited (“7 Days”), a leading economy hotel chain based in China. Cost method of accounting was applied to both transactions due to lack of ability to exercise significant influence (Note 8). | ||||||||||||||
The Company applies equity method in accounting for our investments in entities in which the Company has the ability to exercise significant influence but does not own a majority equity interest or otherwise controls. In 2008, the Company acquired equity interest in Home Inns & Hotels Management Inc. (“Home Inns”) and on May 21, 2009, the Company started to have the ability to exercise significant influence and meeting requirement to apply equity method of accounting (Note 8). In May, 2012, the Company sold 51% equity of Starway Hotels (Hong Kong) Limited (“Starway Hong Kong”) and recorded the 49% of retained non-controlling interests following the equity method of accounting. In November, 2013, the Company further sold the remaining 49% equity interest of Starway Hong Kong (Note 8). In November, 2013, the Company acquired 35% equity shares in Shanghai Yishang Network Technology Co., Ltd(“Yishang Network”) with a cash consideration of RMB13 million along with a contingent consideration, resulting in the Company possessing the ability to exercise significant influence and meeting requirement to apply equity method of accounting (Note 8). Unrealized gains on transactions between the Company and the affiliated entity are eliminated to the extent of the Company’s interest in the affiliated entity; unrealized losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. The Company assesses the contingent consideration on the equity method investments in accordance with ASC 323, “Investments - Equity Method and Joint Ventures”, where the Company assesses the fair value of the investment to determine the contingent consideration to be recorded as liability (Note 8). The initial liability recorded will be part of the equity investment cost, and subsequently upon resolution of the contingency, the fair value of the consideration paid should be compared to the initial liability recorded. If the consideration paid exceeds the liability initially recorded, that amount shall be recognized as an additional cost of the investment, otherwise that amount shall reduce the cost of the investment. | ||||||||||||||
The Company classifies its investments in debt and equity securities into one of three categories and accounts for these as follows: (i) debt securities that the Company has the positive intent and the ability to hold to maturity are classified as “held to maturity” and reported at amortized cost; (ii) debt and equity securities that are bought and held principally for the purpose of selling them in the near term are classified as “trading securities” with unrealized holding gains and losses included in earnings; (iii) debt and equity securities not classified as held to maturity or as trading securities are classified as “available-for-sale” and reported at fair value. The Company has designated its investment in commons shares of China Lodging Group, Limited (“Hanting”) as available-for-sale equity securities and its investment in convertible redeemable preferred shares (“Preferred Share”) of eHi Auto Services Limited(“eHi”), Easy Go Inc.(“Easy Go”), Dining Secretary China Limited (“Dining Secretary”) and Happy City Holdings Limited(“Happy City”) as available-for-sale debt securities in accordance with Accounting Standard Codification (“ASC”) 320-10, respectively (Note 8). Unrealized gains and losses on available-for-sale securities are excluded from earnings and reported as accumulated other comprehensive income (loss), net of tax. Realized gains or losses are charged to earnings during the period in which the gains or losses are realized. | ||||||||||||||
The Company monitors its investments for other-than-temporary impairment by considering factors including, but not limited to, current economic and market conditions, the operating performance of the companies including current earnings trends and other company-specific information. | ||||||||||||||
Fair value measurement of financial instruments | ||||||||||||||
Financial instruments of the Group primarily comprise of cash and cash equivalents, restricted cash, short-term investments, accounts receivable, due from related parties, available-for-sale investments, accounts payable, due to related parties, advances from customers, short-term bank borrowings, other short-term liabilities and long-term debts. As of December 31, 2012 and 2013, carrying values of these financial instruments except for short-term investments and available-for-sale investments approximated their fair values because of their generally short maturities, and the carrying value of the long-term debts also approximates their fair value, as they bear interest at rates determined based on prevailing interest rates in the market. The Company reports short-term investments and available-for-sale investments at fair value at each balance sheet date and changes in fair value are reflected in the statements of income and comprehensive income. | ||||||||||||||
The Company does not have any financial liabilities which must be measured at fair value on a recurring basis. | ||||||||||||||
We measure our financial assets and liabilities using inputs from the following three levels of the fair value hierarchy. The three levels are as follows: | ||||||||||||||
Level 1 inputs are unadjusted quoted prices in active markets for identical assets that the management has the ability to access at the measurement date. | ||||||||||||||
Level 2 inputs include quoted prices for similar assets in active markets, quoted prices for identical or similar assets in markets that are not active, inputs other than quoted prices that are observable for the asset (i.e., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs). | ||||||||||||||
Level 3 includes unobservable inputs that reflect the management’s assumptions about the assumptions that market participants would use in pricing the asset. The management develops these inputs based on the best information available, including the own data. | ||||||||||||||
Business combination | ||||||||||||||
U.S. GAAP requires that all business combinations be accounted for under the purchase method. From January 1, 2009, the Group adopted ASC 805, “Business combinations”. Following this adoption, the cost of an acquisition is measured as the aggregate of the fair values at the date of exchange of the assets given, liabilities incurred, and equity instruments issued. The costs directly attributable to the acquisition are expensed as incurred. Identifiable assets, liabilities and contingent liabilities acquired or assumed are measured separately at their fair value as of the acquisition date, irrespective of the extent of any non-controlling interests. The excess of the (i) the total of cost of acquisition, fair value of the non-controlling interests and acquisition date fair value of any previously held equity interest in the acquiree over (ii) the fair value of the identifiable net assets of the acquiree is recorded as goodwill. If the cost of acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognized directly in the consolidated statements of income and comprehensive income. | ||||||||||||||
The determination and allocation of fair values to the identifiable assets acquired and liabilities assumed is based on various assumptions and valuation methodologies requiring considerable management judgment. The most significant variables in these valuations are discount rates, terminal values, the number of years on which to base the cash flow projections, as well as the assumptions and estimates used to determine the cash inflows and outflows. Management determines discount rates to be used based on the risk inherent in the related activity’s current business model and industry comparisons. Terminal values are based on the expected life of products and forecasted life cycle and forecasted cash flows over that period. Although we believe that the assumptions applied in the determination are reasonable based on information available at the date of acquisition, actual results may differ from the forecasted amounts and the difference could be material. | ||||||||||||||
From January 1, 2009, following the adoption of ASC 810, “Consolidation”, the Company also renamed the minority interests to non-controlling interests and reclassified it on the consolidated balance sheet from the mezzanine section between liabilities and equity to a separate line item in shareholders’ equity. The Company has applied the presentation and disclosure requirements retrospectively for all period presented. | ||||||||||||||
Acquisitions | ||||||||||||||
Wing On Travel | ||||||||||||||
In May 2010, to develop and expand our overseas business, our wholly-owned subsidiary C-Travel, a Cayman Island company, successfully completed the transaction to acquire 90% of the issued share capital of Wing On Travel’s travel service segment, a Hong Kong based travel service provider that offers packaged-tours as well as air tickets and hotel reservation services. We obtained control over Wing On Travel and have consolidated its financial statements since then. The total purchase price for the transaction is approximately RMB598 million (US$88 million). The cash payment is approximately RMB454 million (approximately US$68 million) after the Company assumed net current liability of Wing On Travel as of acquisition date. In February, 2012, Ctrip acquired the remaining 10% of the issued share capital of Wing On Travel’s travel service segment as operated through HKWOT (BVI) Limited, at a consideration of approximately RMB60 million (US$9.4 million). The purchase of the remaining 10% non-controlling interests was initiated by the Company is treated as an equity transaction. The difference between the book value of the 10% non-controlling interests and the cash consideration of Rmb21.7 million was recorded as additional paid in capital. Upon completion of this share purchase, Ctrip holds 100% of the share capital of Wing On Travel. Based on the Company’s assessment, financial results of Wing On Travel is not considered material to the Group for the years ended December 31, 2012 and 2013. | ||||||||||||||
A B2B Hotel Reservation Company | ||||||||||||||
In August, 2013, the Company completed the transaction to acquire controlling shares of a B2B hotel reservation company, through which the Company expects to further enrich its hotel products and to expand in hotel business. The purchase consideration is approximately RMB46 million (US$8 million). The Company makes estimates and judgments in determining the fair value of the acquired assets and liabilities, based in part on independent appraisal reports as well as its experience with purchasing similar assets and liabilities in similar industries. Approximately RMB72 million (US$12 million) excess of the purchase price over the fair value of the identifiable assets and liabilities acquired is recorded as goodwill. The financial results of the acquired entity have been included in the Company’s consolidated financial statements since the acquisition date and were not significant for the Company for the year ended December 31, 2013. | ||||||||||||||
A Wholesaler Operated Hotel Reservation and Air Ticketing Services | ||||||||||||||
In August, 2013, the Company completed the transaction to acquire 100% of the share capital of a wholesaler operated hotel reservation and air ticketing services, which the Company expects to complement its existing business and achieve significant synergies. The purchase consideration is HK$120 million (US$16 million). The Company makes estimates and judgments in determining the fair value of the acquired assets and liabilities, based in part on independent appraisal reports as well as its experience with purchasing similar assets and liabilities in similar industries. Approximately RMB44 million (US$7 million) excess of the purchase price over the fair value of the identifiable assets and liabilities acquired is recorded as goodwill. The financial results of the acquired entity have been included in the Company’s consolidated financial statements since the acquisition date and were not significant for the Company for the years ended December 31, 2013. | ||||||||||||||
Other acquisitions | ||||||||||||||
From time to time, the Company selectively acquired or invested in businesses that complement our existing business, and will continue to do so in the future. Other than disclosed above, none of such acquisitions or investments is material to our businesses or financial results. | ||||||||||||||
Goodwill and other intangible assets | ||||||||||||||
Goodwill represents the excess of the purchase price over the fair value of the identifiable assets and liabilities acquired as a result of the Company’s acquisitions of interests in its subsidiaries and consolidated VIEs. | ||||||||||||||
Goodwill is not amortized but is reviewed at least annually for impairment or earlier, if an indication of impairment exists. Recoverability of goodwill is evaluated using a two-step process. In the first step, the fair value of a reporting unit is compared to its carrying value. If the fair value of a reporting unit exceeds the carrying value of the net assets assigned to a reporting unit, goodwill is considered not impaired and no further testing is required. If the carrying value of the net assets assigned to a reporting unit exceeds the fair value of a reporting unit, the second step of the impairment test is performed in order to determine the implied fair value of a reporting unit’s goodwill. Determining the implied fair value of goodwill requires valuation of a reporting unit’s tangible and intangible assets and liabilities in a manner similar to the allocation of purchase price in a business combination. If the carrying value of a reporting unit’s goodwill exceeds its implied fair value, goodwill is deemed impaired and is written down to the extent of the difference. The Company estimates total fair value of the reporting unit using discounted cash flow analysis, and makes assumptions regarding future revenue, gross margins, working capital levels, investments in new products, capital spending, tax, cash flows, and the terminal value of the reporting unit. | ||||||||||||||
As of December 31, 2013, the step one analysis performed indicated that the fair value of the Company’s reporting units was substantially greater than the respective carrying value. There was no impairment of goodwill during the years ended December 31, 2013, 2012 and 2011. Each quarter the Company reviews the events and circumstances to determine if goodwill impairment may be indicated. | ||||||||||||||
Separately identifiable intangible assets that have determinable lives continue to be amortized and consist primarily of non-compete agreements, customer list, supplier relationship, technology patent and a cross-border travel agency license as of December 31, 2012 and 2013. The Company amortizes intangible assets on a straight-line basis over their estimated useful lives, which is three to ten years. The estimated life of amortized intangibles is reassessed if circumstances occur that indicate the life has changed. Other intangible assets that have indefinite useful life primarily include trademark and domain names as of December 31, 2012 and 2013. The Company evaluates indefinite-lived intangible assets each reporting period to determine whether events and circumstances continue to support an indefinite useful life. If an intangible asset that is not being amortized is subsequently determined to have a finite useful life, the asset is tested for impairment. | ||||||||||||||
The Company reviews intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of these assets may not be recoverable, and also reviews intangible assets with indefinite lives annually for impairment. | ||||||||||||||
No impairment on other intangible assets was recognized for the years ended December 31, 2011, 2012 and 2013. | ||||||||||||||
Impairment of long-lived assets | ||||||||||||||
Long-lived assets (including intangible with definite lives) are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Reviews are performed to determine whether the carrying value of asset group is impaired, based on comparison to undiscounted expected future cash flows. If this comparison indicates that there is impairment, the Group recognizes impairment of long-lived assets to the extent the carrying amount of such assets exceeds the fair value. | ||||||||||||||
No impairment of long-lived assets was recognized for the years ended December 31, 2011, 2012, and 2013. | ||||||||||||||
Accrued liability for customer reward program | ||||||||||||||
The Group’s customers participate in a reward program, which provides travel awards and other gifts to members based on accumulated membership points that vary depending on the services rendered and fees paid. The estimated incremental costs to provide free travel and other gifts are recognized as sales and marketing expense in the statements of income and comprehensive income and accrued for as a current liability as members accumulate points. As members redeem awards or their entitlements expire, the accrued liability is reduced correspondingly. As of December 31, 2012, and 2013, the Group’s accrued liability for its customer reward program amounted to RMB218 million and RMB285 million, respectively, based on the estimated liabilities under the customer reward program. Our expenses for the customer rewards program were approximately RMB128 million, RMB157 million and RMB203 million for the years ended December 31, 2011, 2012 and 2013. | ||||||||||||||
Deferred revenue | ||||||||||||||
In 2011, the Group launched a coupon program, through which the Group provides coupons for customers who book selected hotels online through website. Customers who use the coupons receive credits in their virtual cash accounts upon check-out from the hotels and reviews for hotels submitted. Customers may redeem the amount of credits in their virtual cash account in cash, voucher, or mobile phone credit. In accordance with ASC 605-50 “Revenue Recognition: Customer Payments and Incentives”, the Group accounts for the estimated cost of future usage of coupons as contra-revenue or sales and marketing expenses in the consolidated statements. | ||||||||||||||
Revenue recognition | ||||||||||||||
The Group conducts its principal businesses in Great China Area primarily through Ctrip Computer Technology (Shanghai) Co., Ltd. (“Ctrip Computer Technology”), Ctrip Travel Information Technology (Shanghai) Co., Ltd. (“Ctrip Travel Information”), Ctrip Travel Network Technology (Shanghai) Co., Ltd. (“Ctrip Travel Network”), Ctrip Information Technology (Nantong) Co., Ltd. (“Ctrip Information Technology”), ezTravel and Wing On Travel. Some of the operations of Ctrip Computer Technology and Ctrip Travel Network are conducted through a series of services and other agreements with the VIEs and VIE subsidiaries. | ||||||||||||||
Ctrip Computer Technology, Ctrip Travel Information, Ctrip Travel Network, Ctrip Information Technology and the VIEs are subject to business tax and related surcharges on the provision of taxable services in the PRC, which include hotel reservation and ticketing services provided to customers. In the statements of income and comprehensive income, business tax and related surcharges are deducted from revenues to arrive at net revenues. | ||||||||||||||
In November 2011, the Ministry of Finance released Circular Caishui [2011] No. 111 mandating Shanghai to carry out a pilot program of tax reform. Effective January 1, 2012, selected entities within modern service industries will switch from a business tax payer to a value-added tax (‘‘VAT’’) payer. In May 2013, the Ministry of Finance released Circular Caishui [2013] No. 37 to extend the tax reform nationwide. Effective August 1, 2013, entities within transportation service and selected modern service industries will switch from a business tax payer to a value-added tax (“VAT”) payer. The Company expects such tax reform will not have material impact on its consolidated financial statements. | ||||||||||||||
Hotel reservation services | ||||||||||||||
The Group receives commissions from travel suppliers for hotel room reservations through the Group’s transaction and service platform. Commissions from hotel reservation services rendered are recognized after hotel customers have completed their stay at the applicable hotel and upon confirmation of pending payment of the commissions by the hotel. Contracts with certain travel suppliers contain incentive commissions typically subject to achieving specific performance targets and such incentive commissions are recognized when it is reasonably assured that the Group is entitled to such incentive commissions. The Group generally receives incentive commissions from monthly arrangements with hotels based on the number of hotel room reservations where customers have completed their stay. The Group presents revenues from such transactions on a net basis in the statements of income and comprehensive income as the Group, generally, does not assume inventory risks and has no obligations for cancelled hotel reservations. | ||||||||||||||
Ticketing services | ||||||||||||||
Ticketing services revenues mainly represent revenues from reservations of air tickets, railway tickets and other related services. The Group receives commissions from travel suppliers for ticketing services through the Group’s transaction and service platform under various services agreements. Commissions from ticketing services rendered are recognized after tickets are issued. The Group presents revenues from such transactions on a net basis in the statements of income as the Group, generally, does not assume inventory risks and has no obligations for cancelled airline ticket reservations. Loss due to obligations for cancelled airline ticket reservations is minimal in the past. | ||||||||||||||
Packaged-tour | ||||||||||||||
The Group receives referral fees from travel product providers for packaged-tour products and services through the Group’s transaction and service platform. Referral fees are recognized as commissions on a net basis after the packaged-tour service are rendered and collections are reasonably assured. | ||||||||||||||
Shanghai Ctrip, Beijing Ctrip, Guangzhou Ctrip, Shenzhen Ctrip and Wing On Travel conduct domestic and cross-border travel tour services. Revenues, mainly referral fees, are recognized as commissions on a net basis after the services are rendered. In cases where these entities undertake the majority of the business risks and acts as principal related to the travel tour services provided, revenues are recognized at gross amounts received from customers after the services are rendered. Loss due to obligations from cancelled travel services of such principal arrangement is minimal in the past. | ||||||||||||||
Corporate travel | ||||||||||||||
Corporate travel management revenues primarily include commissions from air ticket booking, hotel reservation and packaged-tour services rendered to corporate clients. The Group contracts with corporate clients based on service fee model. Travel reservations are made via on-line and off-line services for air tickets, hotel and package-tour. Revenue is recognized on a net basis after the services are rendered, e.g. air tickets are issued, hotel stays or packaged-tour are completed, and collections are reasonably assured. | ||||||||||||||
Other businesses | ||||||||||||||
Other businesses comprise primarily of Internet-related advertising services, the sale of Property Management System (“PMS”), and related maintenance service, commissions from train tickets booking and money exchange transaction services. | ||||||||||||||
Shanghai Ctrip Commerce receives advertising revenues, which principally represent the sale of banners or sponsorship on the website from customers. Advertising revenues are recognized ratably over the fixed term of the agreement as services are provided. | ||||||||||||||
Software Hotel Information conducts sale of PMS and related maintenance service. The sale of PMS is recognized upon customer acceptance. Maintenance service is recognized ratably over the term of the maintenance contract on a straight-line basis. | ||||||||||||||
Allowance for doubtful accounts | ||||||||||||||
Accounts receivable are recorded at the invoiced amount and do not bear interest. The Company reviews on a periodic basis for doubtful accounts for the outstanding trade receivable balances based on historical experience and information available. Additionally, we make specific bad debt provisions based on (i) our specific assessment of the collectability of all significant accounts; and (ii) any specific knowledge we have acquired that might indicate that an account is uncollectible. The facts and circumstances of each account may require us to use substantial judgment in assessing its collectability. The following table summarized the details of the Company’s allowance for doubtful accounts: | ||||||||||||||
2011 | 2012 | 2013 | ||||||||||||
RMB | RMB | RMB | ||||||||||||
Balance at beginning of year | 5,718,742 | 4,974,138 | 4,351,963 | |||||||||||
Provision for doubtful accounts | 185,443 | 376,164 | 2,842,681 | |||||||||||
Write-offs | (930,047 | ) | (998,339 | ) | (1,297,741 | ) | ||||||||
Balance at end of period | 4,974,138 | 4,351,963 | 5,896,903 | |||||||||||
Cost of revenues | ||||||||||||||
Cost of revenues consists primarily of payroll compensation of customer service center personnel, telecommunication expenses, credit card service fee, direct cost of principal travel tour services, depreciation, rentals and related expenses incurred by the Group’s transaction and service platform which are directly attributable to the rendering of the Group’s travel related services and other businesses. | ||||||||||||||
Product development | ||||||||||||||
Product development expenses include expenses incurred by the Group to develop the Group’s travel supplier networks as well as to maintain, monitor and manage the Group’s transaction and service platform. The Group recognizes website, software and mobile applications development costs in accordance with ASC 350-50 “Website development costs” and ASC 350-40 “Software — internal use software” respectively. The Group expenses all costs that are incurred in connection with the planning and implementation phases of development and costs that are associated with repair or maintenance of the existing websites and mobile applications or the development of software or mobile applications for internal use and websites content. | ||||||||||||||
Sales and marketing | ||||||||||||||
Sales and marketing expenses consist primarily of costs of payroll and related compensation for the Company’s sales and marketing personnel, advertising expenses, and other related marketing and promotion expenses. Advertising expenses, amounting to RMB163,324,295, RMB275,501,438 and RMB537,757,200 for the years ended December 31, 2011, 2012 and 2013 respectively, are charged to the statements of income as incurred. | ||||||||||||||
Share-based compensation | ||||||||||||||
Under ASC 718, the Company applied the Black-Scholes valuation model in determining the fair value of options granted. Risk-free interest rates are based on US Treasury yield for the terms consistent with the expected life of award at the time of grant. Expected life is based on historical exercise patterns, for options granted before 2008 which the Company has historical data of and believes are representative of future behavior. For options granted since 2008, the Company used simplified method to estimate its expected life. Expected dividend yield is determined in view of the Company’s historical dividend payout rate and future business plan. The Company estimates expected volatility at the date of grant based on historical volatilities. The Company recognizes compensation expense on all share-based awards on a straight-line basis over the requisite service period. Forfeiture rate is estimated based on historical forfeiture patterns and adjusted to reflect future change in circumstances and facts, if any. If actual forfeitures differ from those estimates, we may need to revise those estimates used in subsequent periods. | ||||||||||||||
ASC 718 requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from initial estimates. Share-based compensation expense was recorded net of estimated forfeitures such that expense was recorded only for those share-based awards that are expected to vest. | ||||||||||||||
According to ASC 718, a change in any of the terms or conditions of stock options shall be accounted for as a modification of the plan. Therefore, the Company calculates incremental compensation cost of a modification as the excess of the fair value of the modified option over the fair value of the original option immediately before its terms are modified, measured based on the share price and other pertinent factors at the modification date. For vested options, the Company would recognize incremental compensation cost in the period the modification occurs and for unvested options, the Company would recognize, over the remaining requisite service period, the sum of the incremental compensation cost and the remaining unrecognized compensation cost for the original award on the modification date. | ||||||||||||||
According to ASC 718, the Company classifies options or similar instruments as liabilities if the entity can be required under any circumstances to settle the option or similar instrument by transferring cash or other assets and such cash settlement is probable. The percentage of the fair value that is accrued as compensation cost at the end of each period shall equal the percentage of the requisite service that has been rendered at that date. Changes in fair value of the liability classified award that occur during the requisite service period shall be recognized as compensation cost over that period. Changes in fair value that occur after the end of the requisite service period are compensation cost of the period in which the changes occur. Any difference between the amount for which a liability award is settled and its fair value at the settlement date as estimated is an adjustment of compensation cost in the period of settlement. | ||||||||||||||
Share incentive plans | ||||||||||||||
On November 5, 2004, the Company’s board of directors adopted a 2005 Employee’s Stock Option Plan (“2005 Option Plan”). The 2005 Option Plan was approved by the shareholders of the Company in October 2005. The Company has reserved 3,000,000 ordinary shares for future issuances of options under the 2005 Option Plan. The terms of the 2005 Option Plan are substantially similar to the Company’s 2003 Option Plan. As of December 31, 2012 and 2013, 829,409 and 587,596 options were outstanding under the 2005 Option Plan respectively. | ||||||||||||||
On October 17, 2007, the Company adopted a 2007 Share Incentive Plan (“2007 Incentive Plan”), which was approved by the shareholders of the Company on June 15, 2007. Under the 2007 Incentive Plan, the maximum aggregate number of shares, which may be issued pursuant to all share-based awards (including Incentive Share Options and Restricted Share Units (“RSU”)), is one million ordinary shares as of the first business day of 2007, plus an annual increase of one million shares to be added on the first business day of each calendar year beginning in 2008 to 2016. Under the 2007 Incentive Plan, the directors may, at their discretion, grant any employees, officers, directors and consultants of the Company and/or its subsidiaries such share-based awards. Shares options granted under 2007 Incentive Plan are vested over a period of 4 years. RSUs granted under 2007 Incentive Plan have a restricted period for 4 years. As of December 31, 2012 and 2013, 3,090,126 and 3,543,136 options and 646,301 and 623,424 RSUs were outstanding under the 2007 Incentive Plan. | ||||||||||||||
Option modification | ||||||||||||||
In February 2009, the Board of Directors approved an option modification to reduce the exercise price of all outstanding unvested options that were granted by the Company in 2007 and 2008 to the then fair market value of ordinary shares underlying such options with a new vesting period ranging from three years to four years. The then fair market value was based on the closing price of our ADSs traded on the Nasdaq as of February 10, 2009, which was the last trading day prior to the board approval. Other terms of the option grants remain unchanged. Total options modified amount to 1.6 million. All eligible option grantees affected by such changes had entered into amendments to their original share option agreements with the Company. The Company took a modification charge for the incremental compensation cost of approximately US$15 million over the remaining vesting periods of three years to four years of the modified options. | ||||||||||||||
In December 2009, the Board of Directors approved an option modification to extend the expiration dates of all stock options granted in 2005 and 2006 to eight years after the respective original grant dates of these options. Other terms of the option grants remain unchanged. Total options modified amount to 0.6 million, which were fully vested. The Company had taken a modification charge for the incremental compensation cost of US$2.6 million in 2009, the period in which the modification occurred. | ||||||||||||||
In February 2010, the compensation committee approved an option modification to extend the expiration dates of all stock options granted in and after 2007 to eight years after the respective original grant dates of these options. Other terms of the option grants remain unchanged. Total options modified amount to 2.8 million, which includes 2.3 million related to the unvested options and 0.5 million related to the vested options. The Company has taken a modification charge for the incremental compensation cost of US$2.2 million in 2010 for fully vested options and expects to take approximately US$2.7 million incremental cost for unvested options over their respective remaining vesting period. | ||||||||||||||
In January 2012, the compensation committee passed a resolution to replace all options that previously granted under the 2007 incentive plan but with exercise price above $120.00 per ordinary share, with maximum of 518,017 restricted share units (RSU) of the Company based on the conversion ratio at 4:1 (“the Replacement”). The total options modified approximate 1.9 million and the Company incurred no incremental cost for such modification. | ||||||||||||||
A summary of option activity under the share option plans | ||||||||||||||
The following table summarized the Company’s share option activity under all the option plans (in US$, except shares): | ||||||||||||||
Number of | Weighted | Weighted | Aggregate | |||||||||||
Shares | Average | Average | Intrinsic | |||||||||||
Exercise | Remaining | Value | ||||||||||||
Price | Contractual | |||||||||||||
Life (Years) | ||||||||||||||
Outstanding at December 31, 2010 | 4,414,481 | 67.71 | 5.98 | 415,360,566 | ||||||||||
Granted | 1,375,345 | 136.86 | ||||||||||||
Exercised | (207,142 | ) | 38.12 | |||||||||||
Forfeited | (149,143 | ) | 115.98 | |||||||||||
Outstanding at December 31, 2011 | 5,433,541 | 85.02 | 5.59 | 144,827,231 | ||||||||||
Granted | 961,980 | 79.55 | ||||||||||||
Exercised | (502,991 | ) | 29.39 | |||||||||||
Forfeited | (71,623 | ) | 136.67 | |||||||||||
Converted to RSU in January 2012 | (1,901,372 | ) | 91.8 | |||||||||||
Outstanding at December 31, 2012 | 3,919,535 | 64.81 | 5.14 | 57,772,345 | ||||||||||
Granted | 945,106 | 79.7 | ||||||||||||
Exercised | (660,459 | ) | 48.05 | |||||||||||
Forfeited | (73,450 | ) | 91.75 | |||||||||||
Outstanding at December 31, 2013 | 4,130,732 | 70.42 | 4.99 | 528,988,489 | ||||||||||
Vested and expect to vest at December 31, 2013 | 3,982,976 | 69.95 | 4.92 | 511,937,931 | ||||||||||
Exercisable at December 31, 2013 | 2,283,785 | 60.18 | 3.58 | 315,856,509 | ||||||||||
The Company’s current practice is to issue new shares to satisfy share option exercises. | ||||||||||||||
The expected-to-vest options are the result of applying the pre-vesting forfeiture rate assumptions of 8% to total unvested options. | ||||||||||||||
The aggregate intrinsic value in the table above represents the total intrinsic value (the aggregate difference between the Company’s closing stock price of US$198.48 as of December 31, 2013 and the exercise price for in-the-money options) that would have been received by the option holders if all in-the-money options had been exercised on December 31, 2013. | ||||||||||||||
The total intrinsic value of options exercised during the years ended December 31, 2011, 2012 and 2013 were US$25 million US$34 million and US$99 million, respectively. | ||||||||||||||
The following table summarizes information related to outstanding and exercisable options as of December 31, 2013 (in US$, except shares): | ||||||||||||||
Outstanding | Exercisable | |||||||||||||
Range of | Number of | Weighted-Average | Weighted-average | Number of | Weighted-Average | Weighted-average | ||||||||
Exercise Prices | shares | Exercise Price | Remaining | shares | Exercise Price | Remaining | ||||||||
Contractual | Contractual | |||||||||||||
Life (Years) | Life (Years) | |||||||||||||
23.00-34.99 | 1,125 | 30.5 | 0.12 | 1,125 | 30.5 | 0.12 | ||||||||
35.00-44.99 | 1,353,069 | 38.06 | 3.08 | 1,353,069 | 38.06 | 3.08 | ||||||||
45.00-58.99 | 157,558 | 58.39 | 1.12 | 157,558 | 58.39 | 1.12 | ||||||||
59.00-77.99 | 1,358,411 | 76.78 | 6.98 | 98,324 | 70.69 | 6.43 | ||||||||
78.00-96.99 | 731,131 | 91.36 | 5.24 | 374,298 | 94.61 | 4.28 | ||||||||
97.00-129.99 | 466,500 | 106.12 | 5.61 | 257,333 | 108.79 | 5.4 | ||||||||
130.00-159.99 | 62,938 | 151.78 | 5.17 | 42,078 | 150.76 | 5.1 | ||||||||
4,130,732 | 2,283,785 | |||||||||||||
The weighted average fair value of options granted during the years ended December 31, 2011, 2012 and 2013 was US$64.79, US$38.01 and US$38.40 per share, respectively. | ||||||||||||||
As of December 31, 2013, there was US$78 million of total unrecognized compensation cost, net of estimated forfeitures, related to unvested share options which are expected to be recognized over a weighted average period of 2.6 year. Total unrecognized compensation cost may be adjusted for future changes in estimated forfeitures. For the year ended December 31, 2013, total cash received from the exercise of share options amounted to RMB180,261,090 (approximately US$30 million). | ||||||||||||||
The Company calculated the estimated fair value of share options on the date of grant using the Black-Scholes pricing model with the following assumptions for the years ended December 31, 2011, 2012 and 2013: | ||||||||||||||
2011 | 2012 | 2013 | ||||||||||||
Risk-free interest rate | 0.81% - 2.11% | 0.71%-1.05% | 0.69%-0.87% | |||||||||||
Expected life (years) | 5 | 5 | 5 | |||||||||||
Expected dividend yield | 0% | 0% | 0% | |||||||||||
Volatility | 53%-55% | 56% | 56% | |||||||||||
Fair value of options at grant date per share | from US$48.69 to US$74.39 | from US$33.44 to US$42.18 | from US$37.96 to US$39.69 | |||||||||||
A summary of RSUs activities under the share option plans | ||||||||||||||
The Company granted 188,407, 164,976 and 259,365 RSUs to employees with 4 year requisite service period for the years ended December 31, 2011, 2012 and 2013, respectively. In additional, pursuant to the Replacement mentioned above, another 475,343 RSUs replaced the 1,901,372 options initially granted under the 2007 incentive plan. | ||||||||||||||
The following table summarized the Company’s RSUs activities under all option plans (in US$, except shares): | ||||||||||||||
Number of | Weighted | |||||||||||||
Shares | average grant | |||||||||||||
date fair | ||||||||||||||
value(US$) | ||||||||||||||
Restricted shares | ||||||||||||||
Outstanding at December 31, 2011 | 190,916 | 130.29 | ||||||||||||
Granted | 164,976 | 82.34 | ||||||||||||
Converted from option in January 2012 | 475,343 | — | ||||||||||||
Exercised | (124,644 | ) | 129.84 | |||||||||||
Forfeited | (60,290 | ) | 128.27 | |||||||||||
Unvested at December 31, 2012 | 646,301 | 101.3 | * | |||||||||||
Granted | 259,365 | 79.23 | ||||||||||||
Exercised | (224,939 | ) | 118.54 | |||||||||||
Forfeited | (57,303 | ) | 85.4 | |||||||||||
Unvested at December 31, 2013 | 623,424 | 83.6 | * | |||||||||||
* It does not include the impact of restricted shares converted from option. | ||||||||||||||
Total share-based compensation cost for the RSUs amounted to US$22.5million, US$12.5 million and US$13.2 million for the years ended December 31, 2011, 2012 and 2013, respectively. As of December 31, 2013, there was US$31 million unrecognized compensation cost, net of estimated forfeitures, related to unvested restricted shares, which are to be recognized over a weighted average vesting period of 2.3 years. Total unrecognized compensation cost may be adjusted for future changes in estimated forfeitures. | ||||||||||||||
Operating leases | ||||||||||||||
Leases where substantially all the rewards and risks of ownership of assets remain with the leasing company are accounted for as operating leases. Payments made under operating leases net of any incentives received by the Group from the leasing company are charged to the statements of income on a straight-line basis over the lease periods. | ||||||||||||||
Taxation | ||||||||||||||
Deferred income taxes are provided using the balance sheet liability method. Under this method, deferred income taxes are recognized for the tax consequences of significant temporary differences by applying enacted statutory rates applicable to future years to differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities. The tax base of an asset or liability is the amount attributed to that asset or liability for tax purposes. The effect on deferred taxes of a change in tax rates is recognized in income in the period enacted. A valuation allowance is provided to reduce the amount of deferred tax assets if it is considered unlikely that some portion of, or all of, the deferred tax assets will not be realized. | ||||||||||||||
Effective January 1, 2007, the Company adopted ASC 740, “Income Taxes”. It clarifies the accounting for uncertainty in income taxes recognized in the Company’s consolidated financial statements and prescribes a more likely than not threshold for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. It also provides guidance on derecognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, accounting for interest and penalties associated with tax positions, accounting for income taxes in interim periods, and income tax disclosures. | ||||||||||||||
As of both December 31, 2012 and 2013, the Company did not record any liability for uncertain tax positions. The Company’s policy is to recognize, if any, tax related interest as interest expenses and penalties as general and administrative expenses. For 2013, the Company did not have any interest and penalties associated with tax positions. | ||||||||||||||
Other income(net) | ||||||||||||||
Other income primarily consists of financial subsidies, investment income and foreign exchange gains/(losses). Financial subsidies from local PRC government authority were recorded as other income in the consolidated statements of income. There are no defined rules and regulations to govern the criteria necessary for companies to enjoy such benefits and the amount of financial subsidy are determined at the discretion of the relevant government authority. Financial subsidies are recognized as other income when received. Components of other income for the years ended December 31, 2011, 2012 and 2013 were as follows: | ||||||||||||||
2011 | 2012 | 2013 | ||||||||||||
RMB | RMB | RMB | ||||||||||||
Financial subsidies | 72,791,093 | 90,280,139 | 119,697,248 | |||||||||||
Foreign exchange gains/(losses) | 34,879,388 | (9,781,057 | ) | 32,523,857 | ||||||||||
Reimbursement from the depository | 8,080,557 | 7,914,706 | 17,507,842 | |||||||||||
Loss from disposal of property, equipment and software | (3,379,449 | ) | (653,191 | ) | (11,946,443 | ) | ||||||||
Gain on disposal of cost method investment | — | — | 4,014,829 | |||||||||||
Gain on disposal of equity investment | — | — | 592,742 | |||||||||||
Gain on deconsolidation of subsidiaries | — | 44,432,052 | — | |||||||||||
Others | 5,252,136 | (1,904,706 | ) | 732,299 | ||||||||||
Total | 117,623,725 | 130,287,943 | 163,122,374 | |||||||||||
Statutory reserves | ||||||||||||||
The Company’s PRC subsidiaries and the VIEs are required to allocate at least 10% of their after-tax profit to the general reserve in accordance with the PRC accounting standards and regulations. The allocation to the general reserve can be stopped if such reserve has reached 50% of the registered capital of each company. Appropriations to the enterprise expansion fund, staff welfare and bonus fund are at the discretion of the board of directors of Ctrip Computer Technology, Ctrip Travel Information, Ctrip Travel Network, Ctrip Information Technology and Software Hotel Information, the subsidiaries of the Company. Appropriations to discretionary surplus reserve are at the discretion of the board of directors of the VIEs. These reserves can only be used for specific purposes and are not transferable to the Company in form of loans, advances, or cash dividends. During the years ended December 31, 2011, 2012, and 2013, appropriations to statutory reserves have been made of RMB3,408,849, RMB3,371,696, and RMB13,500,462, respectively. The Company’s subsidiary in Taiwan, ezTravel, is required to allocate 10% of its after-tax profit to the statutory reserve in accordance with the Taiwan regulations. During the years ended December 31, 2012 and 2013, appropriations to statutory reserves equivalent to RMB1,801,148, and RMB1,726,256 have been made, respectively. There is no such regulation of providing statutory reserve in Hong Kong. | ||||||||||||||
Dividends | ||||||||||||||
Dividends are recognized when declared. | ||||||||||||||
PRC regulations currently permit payment of dividends only out of accumulated profits as determined in accordance with PRC accounting standards and regulations. The Company’s PRC subsidiaries can only distribute dividends after they have met the PRC requirements for appropriation to statutory reserves. Additionally, as the Company does not have any direct ownership in the VIEs, the VIEs cannot directly distribute dividends to the Company. The PRC government imposes control over its foreign currency reserves in part through direct regulation of the conversion of RMB into foreign exchange and through restrictions on foreign trade. As substantially all of our revenues are in RMB, any restrictions on currency exchange may limit our ability to use revenue generated in RMB to fund our business activities outside China or to make dividend payments in U.S. dollars. Restricted net assets of the Company’s PRC subsidiaries and VIEs not distributable in the form of dividends to the parent as a result of the aforesaid PRC regulations and other restrictions were RMB1.3 billion as of December 31, 2013. | ||||||||||||||
As a result of the aforementioned PRC regulation and the Company’s organizational structure, accumulated profits of the subsidiaries in PRC distributable in the form of dividends to the parent as of December 31, 2011, 2012 and 2013 were RMB2.9 billion, RMB3.6 billion and RMB4.6 billion, respectively. The Company’s PRC subsidiaries and VIEs are able to enter into royalty and trademark license agreements or certain other contractual arrangements at the discretion of the Company without third party consent, for which the compensatory element of the arrangement is excluded from the accumulated profits. | ||||||||||||||
Effective January 1, 2008, current CIT Law imposes a 10% withholding income tax for dividends distributed by foreign invested enterprises to their immediate holding companies outside mainland China. A lower withholding tax rate will be applied if there is a tax treaty arrangement between mainland China and the jurisdiction of the foreign holding company. Distributions to holding companies in Hong Kong that satisfy certain requirements specified by PRC tax authorities, for example, will be subject to a 5% withholding tax rate. | ||||||||||||||
On June 13, 2012, the Company announced that the board of the Company has approved dividend distribution of US$300 million from its PRC subsidiaries to fund a new share repurchase program whereby Ctrip may purchase its own American depositary shares (“ADSs”). This dividend distribution was a one-time event out of the Company’s normal business course, and withholding tax is recorded only for such transaction accordingly. The PRC withholding tax amounted US$15 million was recorded in the Company’s 2012 financial results (Note 15). | ||||||||||||||
Earnings per share | ||||||||||||||
In accordance with “Computation of Earnings Per Share”, basic earnings per share is computed by dividing net income attributable to common shareholders by the weighted average number of common shares outstanding during the year. Diluted earnings per share is calculated by dividing net income attributable to common shareholders as adjusted for the effect of dilutive ordinary equivalent shares, if any, by the weighted average number of ordinary and dilutive ordinary equivalent shares outstanding during the year. Dilutive ordinary equivalent shares consist of ordinary shares issuable upon the exercise of outstanding share options (using the treasury stock method). | ||||||||||||||
Treasury stock | ||||||||||||||
On July 30, 2008 and September 30, 2008 our board of directors and shareholders respectively approved a US$15 million share repurchase plan. On September 29, 2011, our board of directors approved another US$100 million share repurchase plan. And on June 13, 2012, our board of directors approved a US$300 million share repurchase plan. The share-repurchase programs do not require the Company to acquire a specific number of shares and may be suspended or discontinued at any time. | ||||||||||||||
Treasury stock consists of ADS repurchased by the Group under these three plans. In October 2013, US$45.5 million convertible senior notes issued in 2012 was early converted and 588,219 shares of repurchased treasury stock were delivered to bond holders. As of December 31, 2013, the Company had 3,777,087 shares treasury stock at total cost of US$256 million. Treasury stock is accounted for under the cost method. | ||||||||||||||
Segment reporting | ||||||||||||||
The Company operates and manages its business as a single segment. In accordance with“Disclosures about Segment of an Enterprise and Related Information”, the Company’s chief operating decision-maker has been identified as the CEO, who reviews operating results to make decisions about allocating resources and assessing performance for the entire company. Since the Company operates in one reportable segment, all financial segment and product information required by this statement can be found in the Consolidated Statements. | ||||||||||||||
The Company primarily generates its revenues from customers in Great China Area, and assets of the Company are also located in Great China Area. Accordingly, no geographical segments are presented. | ||||||||||||||
Reclassifications | ||||||||||||||
Certain reclassifications have been made to the prior year’s consolidated financial statements to conform to the current year’s presentation and had no impact on net income/(loss) or total shareholders’ equity. | ||||||||||||||
Recent accounting pronouncements | ||||||||||||||
In July 2012, the FASB issued ASU 2012-02, “Intangibles — Goodwill and Other: Testing Indefinite Lived Intangible Assets for Impairment”. The Update applies to all entities, both public and nonpublic, that have indefinite-lived intangible assets, other than goodwill, reported in their financial statements. Per the Update, an entity has the option first to assess qualitative factors to determine whether the existence of events and circumstances indicates that it is more likely than not that the indefinite-lived intangible asset is impaired. If, after assessing the totality of events and circumstances, an entity concludes that it is not more likely than not that the indefinite-lived intangible asset is impaired, then the entity is not required to take further action. The amendments are effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012. The assessment of qualitative factors is optional and at our discretion, the Group bypassed the qualitative assessment as of December 31, 2013 and performed the first step of the quantitative goodwill and intangible assets impairment test. | ||||||||||||||
In February 2013, the FASB issued ASU 2013-02, “Comprehensive Income: Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income”. This Update does not change the current requirements for reporting net income or other comprehensive income in financial statements. However, this Update requires an entity to provide information about the amounts reclassified out of accumulated other comprehensive income by component. In addition, an entity is required to present, either on the face of the statement where net income is presented or in the notes, significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income but only if the amount reclassified is required under U.S. GAAP to be reclassified to net income in its entirety in the same reporting period. For other amounts that are not required under U.S. GAAP to be reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures required under U.S. GAAP that provide additional detail about those amounts. This Update is effective prospectively for reporting periods beginning after December 15, 2012 for public entities. The Company adopted ASU 2013-02 effective January 1, 2013. Such adoption did not have a material effect on the Company’s financial position or results of operations. | ||||||||||||||
In March of 2013, the FASB issued ASU 2013-05, “Foreign Currency Matters (Topic 830), Parent’s Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity.” The amendments clarify the applicable guidance for the release of the cumulative translation adjustment when 1. an entity ceases to have a controlling financial interest in a subsidiary or group of assets that is a nonprofit activity or a business (other than a sale of in substance real estate or conveyance of oil and gas mineral rights) within a foreign entity; 2. there is a loss of a controlling financial interest in a foreign entity or a step acquisition involving an equity method investment that is a foreign entity; and 3. sales or transfers of a controlling financial interest within a foreign entity is the same irrespective of whether the sale or transfer is of a subsidiary or a group of assets (other than a sale of in substance real estate or conveyance of oil and gas mineral rights) that is a nonprofit activity or business. The amendments are effective prospectively for fiscal years (and interim reporting periods within those years) beginning after December 15, 2013. The amendments should be applied prospectively to derecognition events occurring after the effective date. Prior periods should not be adjusted. If an entity elects to early adopt the amendments, it should apply them as of the beginning of the entity’s fiscal year of adoption. The Company does not expect ASU 2013-05 to have a significant impact on the Group’s consolidated result of operations and financial condition. | ||||||||||||||
In March of 2013, the FASB issued ASU 2013-11, “Income Taxes (Topic 740) Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists”. The amendment clarifies that an unrecognized tax benefit, or a portion of an unrecognized tax benefit, should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward, except as follows. To the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. The assessment of whether a deferred tax asset is available is based on the unrecognized tax benefit and deferred tax asset that exist at the reporting date and should be made presuming disallowance of the tax position at the reporting date. The amendments are effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. The amendments should be applied prospectively to all unrecognized tax benefits that exist at the effective date. The Company does not expect ASU 2013-11 to have a significant impact on the Group’s consolidated result of operations and financial condition. | ||||||||||||||
Certain risks and concentration | ||||||||||||||
Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and cash equivalents, restricted cash, short-term investment, accounts receivable, amounts due from related parties, prepayments and other current assets. As of December 31, 2011, 2012 and 2013, substantially all of the Company’s cash and cash equivalents, restricted cash and short-term investment were held in major financial institutions located in the PRC and in Hong Kong, which management considers to be of high credit quality. Accounts receivable are generally unsecured and denominated in RMB, and are derived from revenues earned from operations arising primarily in the PRC. | ||||||||||||||
No individual customer accounted for more than 10% of net revenues for the years ended December 31, 2011, 2012 and 2013. No individual customer accounted for more than 10% of accounts receivable as of December 31, 2012 and 2013. |
PREPAYMENTS_AND_OTHER_CURRENT_
PREPAYMENTS AND OTHER CURRENT ASSETS | 12 Months Ended | |||||
Dec. 31, 2013 | ||||||
PREPAYMENTS AND OTHER CURRENT ASSETS | ' | |||||
PREPAYMENTS AND OTHER CURRENT ASSETS | ' | |||||
3. PREPAYMENTS AND OTHER CURRENT ASSETS | ||||||
Components of prepayments and other current assets as of December 31, 2012 and 2013 were as follows: | ||||||
2012 | 2013 | |||||
RMB | RMB | |||||
Prepayments and deposits to vendors | 644,317,439 | 1,083,771,955 | ||||
Interest receivable | 36,543,547 | 55,861,029 | ||||
Receivables from financial institution | 14,368,206 | 28,303,638 | ||||
Employee advances | 3,676,848 | 10,476,537 | ||||
Prepayments for property and equipment | 7,885,594 | 4,575,720 | ||||
Receivables related to Capped Call Option (Note 18) | 264,779,132 | — | ||||
Others | 22,249,774 | 32,767,408 | ||||
Total | 993,820,540 | 1,215,756,287 |
LONGTERM_DEPOSITS_AND_PREPAYME
LONG-TERM DEPOSITS AND PREPAYMENTS | 12 Months Ended | |||||
Dec. 31, 2013 | ||||||
LONG-TERM DEPOSITS AND PREPAYMENTS | ' | |||||
LONG-TERM DEPOSITS AND PREPAYMENTS | ' | |||||
4. LONG-TERM DEPOSITS AND PREPAYMENTS | ||||||
The Group’s subsidiaries and VIEs are required to pay certain amounts of deposit to airline companies to obtain blank air tickets for sales to customers. The subsidiaries and VIEs are also required to pay deposit to local travel bureau as pledge for insurance of traveler’s safety. | ||||||
Components of long-term deposit and prepayments as of December 31, 2012 and 2013 were as follows: | ||||||
2012 | 2013 | |||||
RMB | RMB | |||||
Prepayments for fixed assets | 15,499,330 | 263,626,283 | ||||
Unamortized debt issuance cost | 32,396,007 | 127,815,384 | ||||
Deposits paid to airline suppliers | 126,190,327 | 127,011,881 | ||||
Deposit paid to lessor | 18,413,764 | 15,161,665 | ||||
Deposit paid to travel bureau | 110,000 | 2,051,195 | ||||
Others | 18,008,882 | 23,519,244 | ||||
Total | 210,618,310 | 559,185,652 |
LONGTERM_LOAN_RECEIVABLE
LONG-TERM LOAN RECEIVABLE | 12 Months Ended |
Dec. 31, 2013 | |
LONG-TERM LOAN RECEIVABLE | ' |
LONG-TERM LOAN RECEIVABLE | ' |
5. LONG-TERM LOAN RECEIVABLE | |
In December, 2013, in connection with the investment on Keystone (Note 8), the Company entered into a loan agreement with Felicity Investment Holdings Limited (“Felicity”) for a total amount of approximately US$29.5 million. The balance of the loan and the compounded accrued interests will be received at the end of the 5 year term of the loan. The loan receivable is fully collateralized with shares of Keystone held by Felicity. |
LAND_USE_RIGHTS
LAND USE RIGHTS | 12 Months Ended |
Dec. 31, 2013 | |
LAND USE RIGHTS | ' |
LAND USE RIGHTS | ' |
6. LAND USE RIGHTS | |
The Company’s land use rights are related to the payment to acquire three land use rights, one of total cost RMB68,269,734 for approximately 17,000 square meters of land in Shanghai, on which the Group has built an information and technology center. The second one was RMB48,912,729 for approximately 19,500 square meters of land in Nantong, which was put into use in May, 2010. The third one was RMB9,747,800 for approximately 9,000 square meters of land in Chengdu, on which the Group plans to build an information and technology center of West China. According to land use right policy in the PRC, the Company has a 50-year use right over the land in Shanghai, a 40-year use right over the land in Nantong, and a 50-year use right over the land in Chengdu, which are used as the basis for amortization, respectively. Amortization expense for the years ended December 31, 2011, 2012 and 2013 was RMB2,620,706, RMB2,801,615 and RMB3,182,490, respectively. As of December 31, 2012 and 2013, the net book value was RMB110,659,284 and RMB107,476,794, respectively. |
PROPERTY_EQUIPMENT_AND_SOFTWAR
PROPERTY, EQUIPMENT AND SOFTWARE | 12 Months Ended | |||||
Dec. 31, 2013 | ||||||
PROPERTY, EQUIPMENT AND SOFTWARE | ' | |||||
PROPERTY, EQUIPMENT AND SOFTWARE | ' | |||||
7. PROPERTY, EQUIPMENT AND SOFTWARE | ||||||
Property, equipment and software and its related accumulated depreciation and amortization as of December 31, 2012 and 2013 were as follows: | ||||||
2012 | 2013 | |||||
RMB | RMB | |||||
Buildings | 892,430,743 | 1,050,102,815 | ||||
Computer equipment | 232,200,943 | 256,542,169 | ||||
Website-related equipment | 107,209,531 | 135,116,574 | ||||
Furniture and fixtures | 58,079,451 | 60,468,480 | ||||
Software | 43,782,203 | 52,640,160 | ||||
Leasehold improvements | 28,866,215 | 44,835,912 | ||||
Construction in progress | 81,050,521 | 199,363,516 | ||||
Less: accumulated depreciation and amortization | (319,682,416 | ) | (386,125,933 | ) | ||
Total net book value | 1,123,937,191 | 1,412,943,693 | ||||
From November, 2011, the Company started to build an information and technology center in Chengdu. All direct costs of the information and technology center were originally capitalized as construction in progress. | ||||||
Depreciation expense for the years ended December 31, 2011, 2012 and 2013 was RMB78,809,867, RMB88,462,807 and RMB110,494,928, respectively. |
INVESTMENTS
INVESTMENTS | 12 Months Ended | |||||
Dec. 31, 2013 | ||||||
INVESTMENTS | ' | |||||
INVESTMENTS | ' | |||||
8. INVESTMENTS | ||||||
The Company’s long-term investments consisting of cost method investments, equity method investments and available-for-sale securities as of December 31, 2012 and 2013 were as follows: | ||||||
2012 | 2013 | |||||
RMB | RMB | |||||
Hanting (available-for-sale) | 585,540,705 | 1,016,455,767 | ||||
eHi (available-for-sale) | — | 570,977,550 | ||||
Easy Go (available-for-sale) | — | 143,904,165 | ||||
Dining Secretary (available-for-sale) | 60,234,118 | 56,242,365 | ||||
Happy City (available-for-sale) | — | 37,358,327 | ||||
Home Inns (equity method) | 762,423,802 | 801,550,868 | ||||
Yishang Network (equity method) | — | 21,665,182 | ||||
Starway Hong Kong (equity method) | 15,656,192 | — | ||||
Keystone (cost method) | — | 155,330,749 | ||||
Zhong’an Online (cost method) | — | 50,000,000 | ||||
Others | 13,393,132 | 3,728,507 | ||||
Total net book value | 1,437,247,949 | 2,857,213,480 | ||||
China Lodging Group, Limited (“Hanting”) | ||||||
On March 31, 2010, the Company purchased newly issued 7,202,482 shares from Hanting in a private placement. On the same day, the Company purchased an aggregate of 11,646,964 shares of Hanting from the then shareholders. In addition, on March 31, 2010, the Company purchased 800,000 ADSs representing 3,200,000 shares of Hanting in its initial public offering (“IPO”). All transactions were made at a purchase price of US$12.25 per ADS, or US$3.0625 per share, which is the then IPO price. The total purchase cost is US$67.5 million (approximately RMB461 million). Upon the closing of the transactions described above, the Company holds an aggregate of 22,049,446 shares of Hanting (including 3,200,000 shares represented by ADSs), representing approximately 9% of Hanting’s total outstanding shares as of March 31, 2010. | ||||||
Given the level of investment, the Company applies ASC-320-25 to account for its investment in Hanting. The Company classified the investment as “available for sale” and measured the fair value at every period end (Note 9). Unrealized holding gains and losses for available-for-sale securities are reported in other comprehensive income until realized. | ||||||
The closing price of Hanting as of December 31, 2013 is US$30.46 per ADS. As of December 31 2013, the Company recorded the investment in Hanting at a fair value of RMB1.0 billion (approximately US$168 million), with RMB608 million increase in fair value of the investment credited to other comprehensive income. | ||||||
eHi Auto Services Limited. (“eHi”) | ||||||
In December 2013, the Company entered into share purchase agreements to acquire 19.6% equity stake of eHi, one of the largest car rental companies in China, by subscribing its Series E convertible preferred shares with a total consideration of US$94.05 million. The transaction was closed on December, 11, 2013. | ||||||
The Company recorded this investment as an available-for-sale debt security since the Company does not have the ability to exercise significant influence and the preferred shares purchased by the Company are redeemable at the option of the Company. Subsequent to initial recognition, the available-for-sale debt security is measured at fair value at every period end (Note 9). Unrealized holding gains and losses for available-for-sale securities are reported in other comprehensive income until realized. There is no significant change in fair value of the investment from the initial investment day to the December 31, 2013. | ||||||
Easy Go Inc. (“Easy Go”) | ||||||
In October 2013, the Company entered into share purchase agreements to acquire 20.0% equity stake of Easy Go by subscribing its Series B convertible preferred shares with a total consideration of US$23 million. The transaction was closed on December, 13, 2013. | ||||||
The Company recorded this investment as an available-for-sale debt since the Company does not have the ability to exercise significant influence and the preferred shares purchased by the Company are redeemable at the option of the Company. Subsequent to initial recognition, the available-for-sale debt security is measured at fair value at every period end (Note 9). Unrealized holding gains and losses for available-for-sale securities are reported in other comprehensive income until realized. There is no significant change in fair value of the investment from the initial investment day to the December 31, 2013. | ||||||
Dining Secretary China Limited (“Dining Secretary”) | ||||||
In November 2010, the Company entered into agreements to acquire a minority stake of Dining Secretary’s Series B convertible preferred shares with total consideration of US$10 million. The transaction was closed on November 24, 2010. Headquartered in Shanghai, Dining Secretary is a leading provider of free online and offline restaurant reservations for diners. Dining Secretary operates in many cities in China, serving diners and restaurants with a call center and the website www.95171.cn. | ||||||
The Company recorded this investment as an available-for-sale debt security. Subsequent to initial recognition, the available-for-sale debt security is measured at fair value at every period end (Note 9). Unrealized holding gains and losses for available-for-sale securities are reported in other comprehensive income until realized. The decrease in fair value of the investment in Dining Secretary of RMB4.3 million (approximately US$0.7 million) was recorded to other comprehensive income as of December 31, 2013. | ||||||
Happy City Holdings Limited (“Happy City”) | ||||||
In June 2013, the Company entered into agreements to acquire 33% equity stake of the Series A preferred shares in Happy City Holding Limited, a privately owned mobile application software company, with total consideration of US$6 million. Through its subsidiaries in PRC, Happy City is engaged in development and operation of a mobile application for hotel searching and booking. | ||||||
The Company recorded this investment as an available-for-sale debt security since the preferred shares purchased by the Company are redeemable at the option of the Company and are not common stocks in substance. Subsequent to initial recognition, the available-for-sale debt security is measured at fair value at every period end (Note 9). Unrealized holding gains and losses for available-for-sale securities are reported in other comprehensive income until realized. There is no significant change in fair value of the investment from the initial investment day to the December 31, 2013. | ||||||
Home Inns & Hotels Management Inc. (“Home Inns”) | ||||||
The Company purchased ADSs of Home Inns from time to time through the open market and in a private placement transaction. As of December 31, 2013, the Company held an aggregate equity interest of approximately 15.39% of the outstanding shares of Home Inns (or 14,400,765 shares). Given the level of investment and the common directors on Board of both companies, the Company applied equity method of accounting to account for the investment in Home Inns. | ||||||
The Company calculated equity in income or losses of investment in Home Inns on one quarter lag basis, as allowed, as the financial statements of Home Inns were not available within a sufficient time period. | ||||||
On October 1, 2011, Home Inns completed a transaction to acquire 100% equity interest in a business, pursuant to which Home Inns issued additional ordinary shares as part of the total consideration. As a result, the Company’s equity interest in Home Inns effectively decreased from 17.47% to 15.39%. In accordance with ASC 323-10-40-1, the Company accounts for a share issuance by an investee as if the investor had sold a proportionate share of its investment. The issuance price per share of the newly issued capital by the investee is higher than the Company’s average per share carrying amount, thus the Company recognized the non-cash gain of RMB39.3 million for the period ended December 31, 2012. The Company picks up equity calculation of Home Inns on a quarter lag basis, as the Company is not able to timely obtain all necessary financial information from Home Inns to perform the equity investment reconciliations between the Company and Home Inns. | ||||||
The carrying amount and unrealized securities holding profit for investment in Home Inns as of December 31, 2012 and 2013 were as follows: | ||||||
2012 | 2013 | |||||
RMB | RMB | |||||
Investment cost | ||||||
Balance at beginning of year | 576,296,429 | 570,709,828 | ||||
Foreign currency translation | (5,586,601 | ) | (16,083,543 | ) | ||
Total investment cost | 570,709,828 | 554,626,285 | ||||
Value booked under equity method | ||||||
Share of cumulative profit | 206,428,719 | 265,745,783 | ||||
Amortization of identifiable intangible assets, net of tax | (14,714,745 | ) | (18,821,200 | ) | ||
Total booked value under equity method | 191,713,974 | 246,924,583 | ||||
Net book value | 762,423,802 | 801,550,868 | ||||
The financial information of Home Inns as of and for the twelve months ended September 30, 2012 and 2013 is as follows: | ||||||
2012 | 2013 | |||||
RMB (‘000) | RMB (‘000) | |||||
Current assets | 1,480,017 | 1,621,982 | ||||
Non-current assets | 7,525,212 | 7,755,635 | ||||
Current liabilities | 1,927,080 | 1,776,838 | ||||
Non-current liabilities | 3,160,390 | 3,292,033 | ||||
Retain earnings | 1,018,922 | 1,175,874 | ||||
Non-controlling interest | 10,975 | 19,429 | ||||
Total revenues | 5,613,953 | 6,208,970 | ||||
Net Revenues | 5,269,377 | 5,825,490 | ||||
Income from operations | 270,689 | 455,294 | ||||
Net income | 4,338 | 191,009 | ||||
Net (loss) / income attributable to Home Inns Group’s shareholders | (395 | ) | 189,650 | |||
The closing price of Home Inns as of December 31, 2013 is US$43.64 per ADS, the aggregate market value of the Company’s investment in Home Inns is approximately RMB1.9 billion (US$314 million). | ||||||
Shanghai Yishang Network Technology Co., Ltd (“Yishang Network”) | ||||||
In June 2013, the Company entered into agreements to acquire 35% equity shares in Yishang Network with total cash consideration of RMB13 million. The transaction was closed on November 30, 2013. Yishang Network is engaged in development and operation of a hotel customer reviews monitoring and management system. The Company applied equity method to account for the investment. | ||||||
As part of the transaction, there was also a contingent consideration which was to be tied up to the 1-year total revenue and net income performance following the transaction date from June 1, 2013 to May 31, 2014. Based on the contingent consideration noted in the agreements, the enterprise value of Yishang will vary from US$5 million to US$17 million, depending on whether Yishang reaches the performance target or not. The Company assessed the estimated enterprise value of Yishang based on its financial result over the corresponding period and recognized fair value of contingent consideration as a liability of RMB 9 million, which was also a part of the equity investment cost. | ||||||
Starway Hotels (Hong Kong) Limited (“Starway Hong Kong”) | ||||||
In May 2012, the Company sold 51% equity interest of Starway Hong Kong to Hanting. Pursuant to the agreement, Hanting was granted the right to purchase the remaining 49% equity interest of Starway Hong Kong, at its sole discretion at any time following April 15, 2012 until and including the first anniversary of the transaction closing date. The deal was consummated on May 1, 2012. In November 2013, the Company further sold the remaining 49% equity interest of Starway Hong Kong to Hanting. | ||||||
Keystone Lodging Holdings Limited. (“Keystone”) | ||||||
On December 3, 2013, the Company acquired approximately 4.0% equity shares in Keystone Lodging Holdings Limited (“Keystone”), which in 2013, merged with 7 Days Group Holdings Limited (“7 Days”), a leading economy hotel chain based in China. The total consideration given was RMB155 million (US$25.5M). The Company applied cost method of accounting to account for the investment due to lack of ability to exercise significant influence. | ||||||
Zhong An Online Property Insurance Co., Ltd (“Zhong An Online”) | ||||||
In October 2013, the Company entered into agreements to contribute a 5% equity stake in Zhong An Online Property Insurance Co., Ltd, China’s first online insurance company. The capital contribution is RMB50 million. The Company applied cost method of accounting to account for the investment due to lack of ability to exercise significant influence. | ||||||
Other investments included cost method investment in BTG-Jianguo Hotels & Resorts Management Co., Ltd.(“BTG-Jianguo”) and equity investments in certain privately-held companies. In May 2013, the Company sold all its equity interest of BTG-Jianguo to a third business party, Beijing Capital Tourism Co., Ltd, and recognized an investment gain in other income of RMB 4.0million. | ||||||
It has been concluded that the fair value of all investments above is greater than or equal to original cost, as a result, no impairments have been recorded for these investments. |
FAIR_VALUE_MEASUREMENT
FAIR VALUE MEASUREMENT | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
FAIR VALUE MEASUREMENT | ' | |||||||||||
FAIR VALUE MEASUREMENT | ' | |||||||||||
9. FAIR VALUE MEASUREMENT | ||||||||||||
In accordance with ASC 820-10, the Company measures short-term investments and available-for-sale investments at fair value on a recurring basis. Available-for-sale investments classified within Level 1 are valued using quoted market prices that currently available on a securities exchange registered with the Securities and Exchange Commission (SEC). Short-term investments classified within Level 2 are valued using directly or indirectly observable inputs in the market place. The available-for-sale investments classified within Level 3 are valued based on a model utilizing unobservable inputs which require significant management judgment and estimation. | ||||||||||||
Assets measured at fair value on a recurring basis are summarized below: | ||||||||||||
Fair Value Measurement at | ||||||||||||
December 31, 2013 Using | ||||||||||||
Quoted Prices | Significant Other | Unobservable | Fair Value at December 31, 2013 | |||||||||
in Active | Observable | inputs | ||||||||||
Market for | Inputs | (Level 3) | ||||||||||
Identical Assets | (Level 2) | |||||||||||
(Level 1) | ||||||||||||
RMB | RMB | RMB | RMB | US$ | ||||||||
Short-term investments | ||||||||||||
Financial products | — | 3,375,477,351 | — | 3,375,477,351 | 557,589,136 | |||||||
Time deposits | — | 259,613,604 | — | 259,613,604 | 42,885,112 | |||||||
Available-for-sale investments | ||||||||||||
Hanting | 1,016,455,767 | — | — | 1,016,455,767 | 167,906,530 | |||||||
eHi | — | — | 570,977,550 | 570,977,550 | 94,318,772 | |||||||
Easy Go | — | — | 143,904,165 | 143,904,165 | 23,771,275 | |||||||
Dining Secretary | — | — | 56,242,365 | 56,242,365 | 9,290,577 | |||||||
Happy City | — | — | 37,358,327 | 37,358,327 | 6,171,156 | |||||||
Total | 1,016,455,767 | 3,635,090,955 | 808,482,407 | 5,460,029,129 | 901,932,558 | |||||||
Fair Value Measurement at | ||||||||||||
December 31, 2012 Using | ||||||||||||
Quoted Prices | Significant Other | Unobservable | Fair Value at December 31, 2012 | |||||||||
in Active | Observable | inputs | ||||||||||
Market for | Inputs | (Level 3) | ||||||||||
Identical Assets | (Level 2) | |||||||||||
(Level 1) | ||||||||||||
RMB | RMB | RMB | RMB | US$ | ||||||||
Short-term investments | ||||||||||||
Financial products | — | 1,030,000,000 | — | 1,030,000,000 | 165,326,399 | |||||||
Time deposits | — | 378,664,335 | — | 378,664,335 | 60,779,817 | |||||||
Available-for-sale investments | ||||||||||||
Hanting | 585,540,705 | — | — | 585,540,705 | 93,985,763 | |||||||
Dining Secretary | — | — | 60,234,118 | 60,234,118 | 9,668,243 | |||||||
Total | 585,540,705 | 1,408,664,335 | 60,234,118 | 2,054,439,158 | 329,760,222 | |||||||
The roll forward of Level 3 eHi’s investment is as following: | ||||||||||||
Amount | ||||||||||||
RMB | ||||||||||||
Fair value of available-for-sale(Level 3) investment as at December 31, 2012 | — | |||||||||||
Investment in Series E Preferred Shares of eHi | 570,977,550 | |||||||||||
Transfer in and/or out of Level 3 | — | |||||||||||
The change in fair value of the investment in eHi | — | |||||||||||
Fair value of available-for-sale (Level 3) investment as at December 31, 2013 | 570,977,550 | |||||||||||
Fair value of available-for-sale investment (Level 3) as at December 31, 2013 (US$) | 94,318,772 | |||||||||||
The roll forward of Level 3 Easy Go’s investment is as following: | ||||||||||||
Amount | ||||||||||||
RMB | ||||||||||||
Fair value of available-for-sale(Level 3) investment as at December 31, 2012 | — | |||||||||||
Investment in Series B Preferred Shares of Easy Go | 139,633,000 | |||||||||||
Transfer in and/or out of Level 3 | — | |||||||||||
The change in fair value of the investment in Easy Go | 4,271,165 | |||||||||||
Fair value of available-for-sale (Level 3) investment as at December 31, 2013 | 143,904,165 | |||||||||||
Fair value of available-for-sale investment (Level 3) as at December 31, 2013 (US$) | 23,771,275 | |||||||||||
The significant unobservable inputs used in the valuation are as following: | ||||||||||||
Valuation Technique | Unobservable Input | Parameter value | ||||||||||
Discounted cash flow | Weighted average cost of capital (“WACC”) | 28% | ||||||||||
Terminal growth rate | 3% | |||||||||||
Lack of marketability discount (“LoMD”) | 17.50% | |||||||||||
Option pricing model | Time to liquidation | 1.57 years | ||||||||||
Risk-free rate | 0.96% | |||||||||||
Expected volatility | 36.72% | |||||||||||
Probability | Liquidation scenario: 55% | |||||||||||
Redemption scenario: 40% | ||||||||||||
Mandatory Conversion scenario: 5% | ||||||||||||
Dividend yield | Nil | |||||||||||
The roll forward of Level 3 Dining Secretary’s investment is as following: | ||||||||||||
Amount | ||||||||||||
RMB | ||||||||||||
Fair value of available-for-sale(Level 3) investment as at December 31, 2011 | 65,414,773 | |||||||||||
Investment in Series B Preferred Shares of Dining Secretary | — | |||||||||||
Transfer in and/or out of Level 3 | — | |||||||||||
Effect of exchange rate change | (638,000 | ) | ||||||||||
The change in fair value of the investment in Ding Secretary | (4,542,655 | ) | ||||||||||
Fair value of available-for-sale (Level 3) investment as at December 31, 2012 | 60,234,118 | |||||||||||
Investment in Series B Preferred Shares of Dining Secretary | — | |||||||||||
Transfer in and/or out of Level 3 | — | |||||||||||
Effect of exchange rate change | (1,764,000 | ) | ||||||||||
The change in fair value of the investment in Ding Secretary | (2,227,753 | ) | ||||||||||
Fair value of available-for-sale (Level 3) investment as at December 31, 2013 | 56,242,365 | |||||||||||
Fair value of available-for-sale investment (Level 3) as at December 31, 2013 (US$) | 9,290,577 | |||||||||||
The significant unobservable inputs used in the valuation are as following: | ||||||||||||
Valuation Technique | Unobservable Input | Parameter value | ||||||||||
Discounted cash flow | Weighted average cost of capital (“WACC”) | 28% | ||||||||||
Terminal growth rate | 3% | |||||||||||
Lack of marketability discount (“LoMD”) | 25% | |||||||||||
Option pricing model | Time to liquidation | 2.0 years | ||||||||||
Risk-free rate | 1.08% | |||||||||||
Expected volatility | 44.90% | |||||||||||
Probability | Liquidation scenario: 45% | |||||||||||
Redemption scenario: 45% | ||||||||||||
IPO scenario: 10% | ||||||||||||
Dividend yield | Nil | |||||||||||
The roll forward of Level 3 Happy City’s investment is as following: | ||||||||||||
Amount | ||||||||||||
RMB | ||||||||||||
Fair value of available-for-sale(Level 3) investment as at December 31, 2012 | — | |||||||||||
Investment in Series A Preferred Shares of Happy City | 36,715,800 | |||||||||||
Transfer in and/or out of Level 3 | — | |||||||||||
The change in fair value of the investment in Happy City | 642,527 | |||||||||||
Fair value of available-for-sale (Level 3) investment as at December 31, 2013 | 37,358,327 | |||||||||||
Fair value of available-for-sale investment (Level 3) as at December 31, 2013 (US$) | 6,171,156 | |||||||||||
The significant unobservable inputs used in the valuation are as following: | ||||||||||||
Valuation Technique | Unobservable Input | Parameter value | ||||||||||
Discounted cash flow | Weighted average cost of capital (“WACC”) | 27.50% | ||||||||||
Terminal growth rate | 3% | |||||||||||
Lack of marketability discount (“LoMD”) | 35% | |||||||||||
Option pricing model | Time to liquidation | 4.0 years | ||||||||||
Risk-free rate | 1.46% | |||||||||||
Expected volatility | 51.20% | |||||||||||
Probability | Liquidation scenario: 50% | |||||||||||
Redemption scenario: 50% | ||||||||||||
Dividend yield | Nil | |||||||||||
The Company determined the fair value of their investment by using an income approach concluding on the overall investee’s equity value and allocating this value to the various classes of preferred and common shares by using an option-pricing method. The determination of the fair value was assisted by an independent appraisal, based on estimates, judgments and information of other comparable public companies. |
GOODWILL
GOODWILL | 12 Months Ended | |||||
Dec. 31, 2013 | ||||||
GOODWILL | ' | |||||
GOODWILL | ' | |||||
10. GOODWILL | ||||||
The changes in the carrying amount of goodwill for the years ended December 31, 2012 and 2013 were as follows: | ||||||
2012 | 2013 | |||||
RMB | RMB | |||||
Balance at beginning of year | 798,601,767 | 822,585,341 | ||||
Acquisition of a B2B hotel reservation company | — | 72,406,431 | ||||
Acquisition of a wholesaler operated hotel reservation and air ticketing services | — | 43,993,740 | ||||
Acquisition (Disposal) of others | 23,983,574 | 33,545,672 | ||||
Balance at end of period | 822,585,341 | 972,531,184 | ||||
In August 2013, the Company purchased 51% equity interest of a B2B hotel reservation company. Goodwill of RMB72 million was recognized from this acquisition (Note 2). | ||||||
In August 2013, the Company purchased 100% equity interest of a wholesaler operated hotel reservation and air ticketing services. Goodwill of RMB44 million was recognized from this acquisition (Note 2). | ||||||
From time to time, the Company selectively acquired or invested in businesses that complement our existing business. In 2012, the Company invested in a high-end travel agency and a railway ticket agency. In 2013, except for the acquisitions above, the Company further invested in a company engaged in operating a mobile application for online interactive travel forums. The excess of the total cost of acquisition, fair value of the non-controlling interests and acquisition date fair value of any previously held equity interest in the acquiree over the fair value of the identifiable net assets of the acquiree are recorded as goodwill. | ||||||
Goodwill arose from the business combination completed in the years ended December 31, 2013 has been allocated to the single reporting unit of the Group. Goodwill represents the synergy effects of the business combination. | ||||||
The Company performed goodwill impairment tests to determine if goodwill impairment is indicated in year 2012 and 2013, and the results of these tests indicated that the Company’s goodwill was not impaired. |
INTANGIBLE_ASSETS
INTANGIBLE ASSETS | 12 Months Ended | |||||
Dec. 31, 2013 | ||||||
INTANGIBLE ASSETS | ' | |||||
INTANGIBLE ASSETS | ' | |||||
11. INTANGIBLE ASSETS | ||||||
Intangible assets as of December 31, 2012 and 2013 were as follows: | ||||||
2012 | 2013 | |||||
RMB | RMB | |||||
Intangible assets | ||||||
Intangible assets to be amortized | ||||||
Non-compete agreements | 11,479,610 | 11,479,610 | ||||
Customer list | 15,942,578 | 15,942,578 | ||||
Supplier Relationship | 9,700,000 | 27,780,000 | ||||
Technology patent | 9,240,000 | 9,240,000 | ||||
Cross-border travel agency license | 1,117,277 | 1,117,277 | ||||
Others | — | 790,000 | ||||
Intangible assets not subject to amortization | ||||||
Trade mark | 290,715,235 | 314,329,235 | ||||
Golf membership certificate | 4,200,000 | 4,200,000 | ||||
Others | 8,736,321 | 8,785,287 | ||||
351,131,021 | 393,663,987 | |||||
Less: accumulated amortization | ||||||
Intangible assets to be amortized | ||||||
Non-compete agreements | (9,183,688 | ) | (11,479,610 | ) | ||
Customer list | (10,499,636 | ) | (11,982,578 | ) | ||
Supplier Relationship | (1,455,000 | ) | (3,178,333 | ) | ||
Technology patent | (7,392,000 | ) | (9,240,000 | ) | ||
Cross-border travel agency license | (1,117,277 | ) | (1,117,277 | ) | ||
Others | — | (13,167 | ) | |||
Intangible assets not subject to amortization | ||||||
Trade mark | — | — | ||||
Golf membership certificate | — | — | ||||
Others | — | — | ||||
(29,647,601 | ) | (37,010,965 | ) | |||
Net book value | ||||||
Intangible assets to be amortized | ||||||
Non-compete agreements | 2,295,922 | — | ||||
Customer list | 5,442,942 | 3,960,000 | ||||
Supplier Relationship | 8,245,000 | 24,601,667 | ||||
Technology patent | 1,848,000 | — | ||||
Cross-border travel agency license | — | — | ||||
Others | — | 776,833 | ||||
Intangible assets not subject to amortization | ||||||
Trade mark | 290,715,235 | 314,329,235 | ||||
Golf membership certificate | 4,200,000 | 4,200,000 | ||||
Others | 8,736,321 | 8,785,287 | ||||
321,483,420 | 356,653,022 | |||||
Amortization expense for the years ended December 31, 2011, 2012 and 2013 was approximately RMB8,445,950, RMB7,736,767 and RMB7,363,364 respectively. | ||||||
The annual estimated amortization expense for intangible assets subject to amortization for the five succeeding years is as follows: | ||||||
Amortization | ||||||
RMB | ||||||
2014 | 3,416,000 | |||||
2015 | 3,416,000 | |||||
2016 | 3,416,000 | |||||
2017 | 3,416,000 | |||||
2018 | 3,402,833 | |||||
17,066,833 |
SHORTTERM_BORROWINGS
SHORT-TERM BORROWINGS | 12 Months Ended |
Dec. 31, 2013 | |
SHORT-TERM BORROWINGS | ' |
SHORT-TERM BORROWINGS | ' |
12. SHORT-TERM BORROWINGS | |
In June 2012, the Group entered into a contract with China Construction Bank for a loan facility of up to US$72.75 million. In June 2013, the facility came to maturity and was extended for another 12 month. The facility is collateralized by a bank deposit of RMB500 million provided by one of the Company’s wholly-owned subsidiaries. As of December 31, 2013, the Group made three borrowings of RMB441 million (US$73 million) in aggregate under the facility. The annual interest rate of borrowings is approximately 2.4%. The Company is in compliance with the loan covenant at December 31, 2013. | |
In August 2013, the Group entered into a contract with Agricultural Bank of China for a loan facility of US$40 million. The facility has a maturity of 12 months and is pledged by a bank deposit of RMB270 million classified as short-term investment of one of the Company’s subsidiaries. As of December 31, 2013, the Group obtained two borrowings of RMB91 million (US$15 million) in aggregate under the facility. The annual interest rate of borrowings is approximately 2.4%. The Company is in compliance with the loan covenant at December 31, 2013. | |
In November 2013, the Group entered into a contract with China Construction Bank for a loan facility of up to US$40 million. The facility has a maturity of 3 months and is collateralized by a bank deposit of RMB270 million classified as short-term investment provided by one of the Company’s wholly-owned subsidiaries. As of December 31, 2013, the Group obtained borrowings of RMB243 million (US$40 million) in aggregate under the facility. The annual interest rate of borrowings is approximately 2.4%. The Company is in compliance with the loan covenant at December 31, 2013. |
RELATED_PARTY_TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
RELATED PARTY TRANSACTIONS | ' | |||||||
RELATED PARTY TRANSACTIONS | ' | |||||||
13. RELATED PARTY TRANSACTIONS | ||||||||
During the years ended December 31, 2011, 2012 and 2013 significant related party transactions were as follows: | ||||||||
2011 | 2012 | 2013 | ||||||
RMB | RMB | RMB | ||||||
Commissions from Home Inns | 17,660,504 | 35,932,452 | 38,709,984 | |||||
Commissions from Hanting | 7,965,109 | 10,988,806 | 17,127,847 | |||||
Consideration for disposal majority equity share of Starway Hong Kong from Hanting | — | 17,131,759 | 16,459,926 | |||||
Entrusted loan and interest to Yishang | — | — | 13,374,109 | |||||
Commissions from Starway Hong Kong | — | 7,118,150 | 6,146,474 | |||||
Commissions from 7 Days Group Holdings Limited (“7 Days”) | — | — | 1,214,368 | |||||
Purchase of tour package from Ananda Travel Service (Aust.) Pty Limited (“Ananda”) | 29,386,855 | 32,989,774 | 32,738,333 | |||||
Printing expenses to Joyu Tourism Operating Group (“Joyu”) | 2,160,000 | 2,160,000 | — | |||||
The Company’s hotel supplier, Home Inns has two directors in common with the Company. Home Inns closed the acquisition of Motel 168 International Holdings Limited (“Motel 168”) on September 30, 2011 and consolidated its financial results thereafter. Commissions from Home Inns presented above include the commissions from Motel 168 starting from October 1, 2011 to December 31, 2013. Another hotel supplier, Hanting, has a director in common with the Company and a director who is a family member of one of our officers. In May 2012, the Company sold 51% equity interest of Starway Hong Kong to Hanting with a total consideration of RMB17.1 million and deconsolidated Starway Hong Kong upon the closing of the deal. On November 30, 2013, Hanting further acquired 49% equity interest of Starway Hong Kong from the Company with a total consideration of RMB16.5 million. The remainder of purchase price RMB12.25 million will be paid in a 3-year installment plan. From then on, the Company directly holds no equity interest of Starway Hong Kong. Commissions from Hanting presented above include the commissions from Starway Hong Kong starting from December 1, 2013 to December 31, 2013. Home Inns and Hanting have entered into agreements with us, respectively, to provide hotel rooms for our customers. Commissions from Home Inns and Hanting for the years ended December 31, 2011, 2012 and 2013 are presented as above. | ||||||||
In September 2013, the Company entered into agreements with Yishang to provide entrusted loan of RMB13 million. The entrusted loan has a one-year maturity period. The balance of entrusted loan together with the interest for the year ended December 31, 2013 is presented as above. | ||||||||
Starway Hong Kong entered into agreements with the Company to provide hotel rooms for our customers. Commissions from Starway Hong Kong started from the deconsolidation date to the year ended December 31, 2012 and started from January 1, 2013 to November 30, 2013 is presented as above. | ||||||||
On December 3, 2013, the Company acquired approximately 4% equity shares in Keystone, which in 2013 merged with 7 Days, thus became related with 7 Days. 7 Days entered into agreements with the Company to provide hotel rooms for our customers. Commission from 7 Days started from the equity transaction date to the year ended December 31 2013 is presented as above. | ||||||||
The Company’s tour package supplier, Ananda is an associate of Wing On Travel. Tour package purchase from Ananda for the years ended December 31, 2011, 2012 and 2013 is presented as above. | ||||||||
The Company entered into printing agreements with TripTX Travel Media Group, one of the subsidiaries of Joyu Tourism Operating Group. Joyu Tourism Operating Group has a director in common with the Company. Total printing expense to Joyu Tourism Operating Group for the years ended December 31, 2011 and 2012 are presented as above. | ||||||||
As of December 31, 2012 and 2013, significant balances with related parties were as follows: | ||||||||
2012 | 2013 | |||||||
RMB | RMB | |||||||
Due from related parties, current: | ||||||||
Due from Yishang | — | 13,152,649 | ||||||
Due from Hanting | 627,145 | 5,592,854 | ||||||
Due from Home Inns | 3,797,931 | 3,029,166 | ||||||
Due from Starway Hong Kong | 903,094 | — | ||||||
5,328,170 | 21,774,669 | |||||||
Due from related parties, non-current: | ||||||||
Due from Hanting | — | 8,166,667 | ||||||
Due to related parties, current: | ||||||||
Due to Ananda | 9,215,726 | 10,216,780 | ||||||
Due to Hanting | 1,000,000 | 1,000,000 | ||||||
Due to Joyu | 180,000 | — | ||||||
10,395,726 | 11,216,780 | |||||||
The amounts due from and due to related parties as of December 31, 2012 and 2013 primarily resulted from the transactions disclosed above and revenue received and expenses paid on behalf of each other. They are not collateralized and have normal business payment terms. |
EMPLOYEE_BENEFITS
EMPLOYEE BENEFITS | 12 Months Ended |
Dec. 31, 2013 | |
EMPLOYEE BENEFITS | ' |
EMPLOYEE BENEFITS | ' |
14. EMPLOYEE BENEFITS | |
The Group’s employee benefit primarily related to the full-time employees of the PRC subsidiaries and the VIEs, including medical care, welfare subsidies, unemployment insurance and pension benefits. The full-time employees in the PRC subsidiaries and the VIEs are required to accrue for these benefits based on certain percentages of the employees’ salaries in accordance with the relevant PRC regulations and make contributions to the state-sponsored pension and medical plans out of the amounts accrued for medical and pension benefits. The PRC government is responsible for the medical benefits and ultimate pension liability to these employees. The total expenses recorded for such employee benefits amounted to RMB234,725,030, RMB334,150,368 and RMB440,884,906 for the years ended December 31, 2011, 2012 and 2013 respectively. |
TAXATION
TAXATION | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
TAXATION | ' | |||||||
TAXATION | ' | |||||||
15. TAXATION | ||||||||
Cayman Islands | ||||||||
Under the current laws of Cayman Islands, the Company is not subject to tax on income or capital gain. In addition, upon payments of dividends by the Company to its shareholders, no Cayman Islands withholding tax will be imposed. | ||||||||
Hong Kong | ||||||||
The Company’s subsidiaries registered in the Hong Kong are subject to Hong Kong Profits Tax (“CIT”) on the taxable income as reported in their respective statutory financial statements adjusted in accordance with relevant Hong Kong tax laws. The applicable tax rate is 16.5% in Hong Kong. | ||||||||
Taiwan | ||||||||
The Company’s consolidated entities registered in the Taiwan are subject to Taiwan Enterprise Income Tax (“CIT”) on the taxable income as reported in their respective statutory financial statements adjusted in accordance with relevant Taiwan income tax laws. In the first half of the year 2010, announced by local authority, general enterprise income tax rate of Taiwan was reduced from 25% to 17%. The application tax rate for the Company’s subsidiary in Taiwan is 17%, which was effective retroactively as of January 1, 2010. | ||||||||
China | ||||||||
The Company’s subsidiaries and VIEs registered in the PRC are subject to PRC Corporate Income Tax (“CIT”) on the taxable income as reported in their respective statutory financial statements adjusted in accordance with relevant PRC income tax laws. | ||||||||
In 2007, the National People’s Congress passed new PRC CIT Law and Detailed Implementation Rules of China CIT Law. The CIT laws were effective on January 1, 2008. The CIT laws apply a general enterprise income tax rate of 25% to both foreign-invested enterprises and domestic enterprises. Preferential tax treatments will continue to be granted to enterprises, which conduct business in certain encouraged sectors and to enterprises otherwise classified as a high and new technology enterprise. In December 2008, the Company’s subsidiaries, Ctrip Computer Technology, Ctrip Travel Information, Ctrip Travel Network and Software Hotel Information obtained approval for the High New Tech Enterprises status. The applicable tax rate for High New Tech Enterprise is 15%, which was effective retroactively as of January 1, 2008. The High New Tech Enterprises qualification has a three-year effective period which expired on December 31, 2010. These four entities reapplied for the qualification in 2011, and got approval form government authority. | ||||||||
Shenzhen Ctrip is registered in the city of Shenzhen in China, which was a special economic zone entitled to a preferential tax rate of 15% before 2008. Under the current CIT law, Shenzhen Ctrip is entitled to a transitional tax rate which is gradually increased to 25% from 2008 to 2012. The applicable CIT rates from 2008 to 2012 are 18%, 20%, 22%, 24% and 25%, respectively. Starting from 2012, Shenzhen Ctrip would be subjected to the general CIT rate of 25%. | ||||||||
In 2002, China’s State Administration of Taxation passed an implementation for the preferential tax treatment in China’s Western Region. Enterprises falling within the Catalog of Encouraged Industries in the Western Region (“Old Catalog”) enjoyed a preferential income tax rate of 15% from 2001 to 2010. In 2011, Chengdu Ctrip and Chengdu Ctrip International obtained approval to use the 15% tax rate for 2010 income tax. The qualification has an effective period which expired on December 31, 2010. In 2012, China’s State Administration of Taxation extended the period to 2020. Accordingly, a new Catalog of Encouraged Industries in the Western Region (“New Catalog”) will be released. Before the release of the New Catalog, enterprises falling within the encouraged industries under the “old” Catalogs may temporarily apply the 15% rate for CIT filing upon agreement by the in-charge tax authorities. The Company applied 25% rate for CIT filling in 2011. In 2012, Chengdu Ctrip and Chengdu Ctrip International obtained approval from local tax authorities to apply the 15% tax rate for 2011 tax filing and for the year from 2012 to 2014. In 2013, Chengdu Information Technology Co., Ltd. (“Chengdu Information”) obtained approval from local tax authorities to apply the 15% tax rate for 2012 tax filing and for the year from 2013 to 2016. | ||||||||
In 2013, in accordance with CIT Law, the applicable CIT rates are 25%, except for aforementioned four subsidiaries qualified for High New Tech Enterprises, Chengdu Ctrip, Chengdu Ctrip International and Chengdu Information. | ||||||||
Pursuant to the CIT Law and Circular Caishui [2008]No.1 issued by Ministry of Finance of China on February 22, 2008, the dividends declared out of the profits earned after January 1, 2008 by a foreign invested enterprise(“FIE”) to its immediate holding company outside mainland China would be subject to withholding taxes. A favorable withholding tax rate will be applied if there is a tax treaty arrangement between Mainland China and the jurisdiction of the foreign holding company and other supplementary guidance/requirements stipulated by State Administration of Taxation (“SAT”) and tax treaty are met and proper procedures have been gone through. The Company’s subsidiaries, Ctrip Computer Technology, Ctrip Travel Information, Ctrip Travel Network, and Ctrip Information Technology are considered FIEs and are directly held by our subsidiaries in Hong Kong. According to double tax arrangement between Mainland and Hong Kong Special Administrative Region, dividends payable by an FIE in mainland China to the company in Hong Kong will be subject to 5% withholding tax, subject to approval of the tax authority. All of these foreign invested enterprises will be subject to the withholding tax for their earnings generated after January 1, 2008. The Company expects to indefinitely reinvest undistributed earnings generated after January 1, 2008 in the onshore PRC entities. As a result, no deferred tax liability was provided on the outside basis difference from undistributed earnings after January 1, 2008. | ||||||||
On June 13, 2012, the board of the Company has approved dividend distribution of US$300 million from its PRC subsidiaries to fund a new share repurchase program whereby Ctrip may purchase its own American depositary shares (“ADSs”). The dividends paid by the Company’s PRC subsidiaries to the Company through its Hong Kong subsidiary is subject to a 5% PRC withholding tax, of which RMB95 million (US$15 million) is accrued as of December 31, 2012. | ||||||||
The dividend distribution on June 13, 2012 aforesaid was a one-time event out of the Company’s normal business course, and withholding tax is recorded only for such transaction accordingly. The Company expects to indefinitely reinvest the remaining undistributed earnings generated after January 1, 2008 in the onshore PRC entities. As a result, no additional deferred tax liability was provided on the outside basis difference for the remaining undistributed earnings of RMB4.6 billion after January 1, 2008. | ||||||||
Composition of income tax expense | ||||||||
The current and deferred portion of income tax expense included in the consolidated statements of income for the years ended December 31, 2011, 2012 and 2013 were as follows: | ||||||||
2011 | 2012 | 2013 | ||||||
RMB | RMB | RMB | ||||||
Current income tax expense | 265,574,760 | 317,283,820 | 329,612,294 | |||||
Deferred tax benefit | (3,388,535 | ) | (22,757,864 | ) | (35,871,972 | ) | ||
Income tax expense | 262,186,225 | 294,525,956 | 293,740,322 | |||||
Income tax expense was RMB294 million (US$49 million) in the year ended December 31, 2013, decrease from RMB295 million in the year ended 2012. The effective income tax rate in year ended December 31, 2013 was 26%, as compared to 31% in the year ended 2012, mainly because the Company accrued, in the second quarter of 2012, the provision of 5% PRC withholding tax related to the one-time event of dividend distribution that its PRC subsidiaries would pay to its Hong Kong subsidiary to fund a share repurchase program, whereby Ctrip may purchase its own American depositary shares (“ADSs”), and partially offset by the impact of certain non-tax-deductible items in its PRC subsidiaries during the year ended December 31, 2013. | ||||||||
Reconciliation of the differences between statutory tax rate and the effective tax rate | ||||||||
The reconciliation between the statutory CIT rate and the Group’s effective tax rate for the years ended December 31, 2011, 2012 and 2013 were as follows: | ||||||||
2011 | 2012 | 2013 | ||||||
Statutory CIT rate | 25 | % | 25 | % | 25 | % | ||
Tax differential from statutory rate applicable to Subsidiaries in the PRC | (10 | )% | (17 | )% | (15 | )% | ||
Non-deductible expenses incurred | 6 | % | 13 | % | 16 | % | ||
Withholding tax | — | 10 | % | — | ||||
Others | (1 | )% | 0 | % | 0 | % | ||
Effective CIT rate | 20 | % | 31 | % | 26 | % | ||
Significant components of deferred tax assets and liabilities: | ||||||||
2012 | 2013 | |||||||
RMB | RMB | |||||||
Deferred tax assets: | ||||||||
Loss carry forward | 42,205,411 | 86,735,795 | ||||||
Accrued liability for customer reward related programs | 32,209,006 | 60,078,932 | ||||||
Accrued staff salary | 22,215,827 | 34,842,016 | ||||||
Deferred tax liabilities | (390,000 | ) | (390,000 | ) | ||||
Others | 3,452,556 | 2,448,552 | ||||||
Less: Valuation allowance of deferred tax assets | (37,852,274 | ) | (86,735,795 | ) | ||||
Total deferred tax assets | 61,840,526 | 96,979,500 | ||||||
Deferred tax liabilities, non-current: | ||||||||
Recognition of intangible assets | (53,309,153 | ) | (63,197,155 | ) | ||||
Net deferred tax assets | 8,531,373 | 33,782,345 | ||||||
Movement of valuation allowances: | ||||||||
2011 | 2012 | 2013 | ||||||
RMB | RMB | RMB | ||||||
Balance at beginning of year | 12,733,226 | 14,785,786 | 37,852,274 | |||||
Current year additions | 2,879,759 | 27,991,746 | 48,883,521 | |||||
Current year disposal due to divestitures | (827,199 | ) | (4,925,258 | ) | — | |||
Balance at end of year | 14,785,786 | 37,852,274 | 86,735,795 | |||||
As of December 31, 2012 and 2013, valuation allowance of RMB37.9 million and RMB86.7 million was provided for operating loss carry forwards related to certain subsidiary based on then assessment where it is more likely than not that such deferred tax assets will not be realized. If events were to occur in the future that would allow us to realize more of our deferred tax assets than the presently recorded net amount, an adjustment would be made to the deferred tax assets that would increase income for the period when those events occurred. | ||||||||
As of December 31, 2013, the Group had net operating tax loss carry forwards amounted to RMB347 million which will expire from 2014 to 2017 if not used. | ||||||||
The provisions for income taxes for the years ended December 31, 2011, 2012 and 2013 differ from the amounts computed by applying the CIT primarily due to preferential tax rate enjoyed by certain of the Company’s subsidiaries and VIEs in the PRC. | ||||||||
The following table sets forth the effect of preferential tax on China operations: | ||||||||
2011 | 2012 | 2013 | ||||||
RMB | RMB | RMB | ||||||
Tax holiday effect | 115,750,217 | 119,971,884 | 146,321,156 | |||||
Basic net income per ADS effect | 0.8 | 0.88 | 1.11 | |||||
Diluted net income per ADS effect | 0.76 | 0.83 | 0.96 |
OTHER_PAYABLES_AND_ACCRUALS
OTHER PAYABLES AND ACCRUALS | 12 Months Ended | |||||
Dec. 31, 2013 | ||||||
OTHER PAYABLES AND ACCRUALS | ' | |||||
OTHER PAYABLES AND ACCRUALS | ' | |||||
16. OTHER PAYABLES AND ACCRUALS | ||||||
Components of other payables and accruals as of December 31, 2012 and 2013 were as follows: | ||||||
2012 | 2013 | |||||
RMB | RMB | |||||
Accrued operating expenses | 204,438,348 | 330,863,616 | ||||
Electronic coupon | 41,475,136 | 133,306,380 | ||||
Accruals for property and equipment | 34,450,253 | 37,038,698 | ||||
Deposits received from suppliers and packaged-tour customers | 10,161,612 | 33,769,690 | ||||
Due to employees for stock option proceeds received on their behalf | 13,242,768 | 28,413,780 | ||||
Payable for acquisition | 19,742,776 | 23,773,221 | ||||
Interest payable | 1,492,269 | 13,838,961 | ||||
Others | 18,754,719 | 34,100,603 | ||||
Total | 343,757,881 | 635,104,949 |
LONGTERM_DEBT
LONG-TERM DEBT | 12 Months Ended | |||||
Dec. 31, 2013 | ||||||
LONG-TERM DEBT. | ' | |||||
LONG-TERM DEBT | ' | |||||
17. LONG-TERM DEBT | ||||||
2012 | 2013 | |||||
RMB | RMB | |||||
2017 Convertible Senior Notes | 1,121,418,000 | 814,222,650 | ||||
2018 Convertible Senior Notes | — | 4,842,960,000 | ||||
Total | 1,121,418,000 | 5,657,182,650 | ||||
Description of 2017 Convertible Senior Notes | ||||||
On September 24, 2012, the Company issued US$180 million in aggregate principle amount of 0.5% Convertible Senior Notes due September 15, 2017 (the “Notes”) at par. The Notes may be converted, under certain circumstances, based on an initial conversion rate of 51.7116 American depository shares (“ADS”) per US$1,000 principal amount of the Notes (which represents an initial conversion price of US$19.34 per ADS). | ||||||
The net proceeds to the Company from the issuance of the Notes were US$175 million. The Company pays cash interest at an annual rate of 0.5% on the Notes, payable semi-annually in arrears on March 15 and September 15 of each year, beginning March 15, 2013. Debt issuance costs were US$5.4 million and are being amortized to interest expense to the first put date of the Notes (September 15, 2015). | ||||||
The Notes are general senior unsecured obligations and rank (1) senior in right of payment to any of the Company’s future indebtedness that is expressly subordinated in right of payment to the Notes, (2) equal in right of payment to any of the Company’s future indebtedness and other liabilities of the Company that are not so subordinated, (3) junior in right of payment to any of the Company’s secured indebtedness to the extent of the value of the assets securing such indebtedness and (4) structurally junior to all future indebtedness incurred by the Company’s subsidiaries and their other liabilities (including trade payables). | ||||||
Concurrently with the issuance of the Notes, the Company purchased a call option (“Purchased Call Option”) and sold warrants (“Sold Warrants”). The separate Purchased Call Option and Sold Warrants are structured to reduce the potential future economic dilution associated with the conversion of the Notes and to increase the initial conversion price to US$26.37 per ADS. Each of these components is discussed separately below: | ||||||
Purchase Call Option | ||||||
Counterparty agreed to sell to the Company up to approximately 9.3 million shares of the Company’s ADS, which is the number of ADS initially issuable upon conversion of the Notes in full, at a price of US$19.34 per ADS. The Purchased Call Option will be settled by the counterparty in ADSs and will terminate upon the maturity date of the Notes. Settlement of the Purchased Call Option in ADSs, based on the number of ADSs issued upon conversion of the Notes, on the expiration date would result in the Company receiving shares equivalent to the number of shares issuable by the Company upon conversion of the Notes. Should there be an early termination of the Purchased Call Option, the number of ADSs potentially received by the Company will depend upon 1) the then existing overall market conditions, 2) the Company’s stock price, 3) the volatility of the Company’s stock, and 4) the amount of time remaining before expiration of the convertible note hedge. | ||||||
Sold Warrants | ||||||
The Company received US$26.6 million from the same counterparty from the sale of warrants to purchase up to approximately 9.3 million shares of the Company’s ADS at an exercise price of US$26.37 per ADS. The warrants had an expected life of 5 years and expire on September 15, 2017. At expiration, the Company may, at its option, elect to settle the warrants on a net share basis. As of December 31, 2013, the warrants had not been exercised and remained outstanding. | ||||||
Evaluation thattransactions should be viewed as a single unit: | ||||||
In accordance with ASC 815-10-15, the Company concluded that the offering of the Notes, Purchased Call Option and the Issued Warrants (1) do not entail the same risks as the Notes involve interest, credit and equity risks, whereas the Purchased Call Option and Issued Warrants transaction was intended to reduce the equity dilution risk for the Company and (2) have a valid business purpose and economic need for structuring the transactions separately as the Company wanted to mitigate future dilution upon conversion of the Notes, as such required that the purchased call option is an American style option which is physical settled whereas the warrant is a European style instrument that allows net share settlement or cash settlement at the choice of the Company. Therefore, the offering of the Notes, Purchased Call Option and Issued Warrants transactions should be accounted for as separate transactions. | ||||||
The Company has accounted for the Notes in accordance with ASC 470, as a single instrument as a long-term debt. The value of the Notes is measured by the cash received. As of December 31, 2013, RMB814 million (US$134.5 million) is accounted as the value of the Notes in long-term debt. | ||||||
The key terms of the Notes are as follows: | ||||||
Redemption | ||||||
Contingent redemption option | ||||||
The Notes are not redeemable prior to the maturity date of September 15, 2017, except as described below. The holders of the Notes (the “Holders”) have a non-contingent option to require the Company to repurchase for cash all or any portion of their Notes on September 15, 2015. The repurchase price will equal 100% of the principal amount of the Notes to be repurchased plus accrued and unpaid interest, if any, to, but excluding, the repurchase date. If a fundamental change (as defined in the Indenture) occurs prior to the maturity date, the Holders may require the Company to purchase for cash all or any portion of the Notes at a purchase price equal to 100% of the principal amount of the Notes to be purchased plus accrued and unpaid interest, if any, to, but excluding, the fundamental change purchase date. The Holders have the option to require the Company to repurchase the Notes, in whole or in part, in the event of a fundamental change for an amount equal to the 100% of the principal amount and any accrued and unpaid interest in the event of fundamental changes. Management assessed The Company believes that the likelihood of occurrence of events considered a fundamental change is remote. | ||||||
The contingent redemption option is assessed in accordance with ASC 815-15-25-42. The contingent redemption option is considered clearly and closely related to its debt host and does not meet the requirement for bifurcation as the Notes were issued at par and the repurchase feature requires the issuer to settle the option by delivering par plus accrued and unpaid interest, the Notes holder would recover all of their initial investment. Additionally, since the Notes holder can only recover its initial investment upon exercise of its option, there are no interest rate scenarios under which the embedded derivative would at least double the investor’s initial rate of return. | ||||||
Non-contingent redemption option | ||||||
On or after September 15, 2015 (after year 3), the Holders have the right to require the issuer to redeem, at 100% of the loan’s principal amount plus accrued and unpaid interest, in which circumstance the Holders would recover substantially all of their initial investment. | ||||||
Since the Holders can only recover its initial investment upon exercise of its option, there are no interest rate scenarios under which the embedded derivative would at least double the investor’s initial rate of return. Therefore, the embedded repurchase feature (put option) is considered clearly and closely related to the debt host pursuant to ASC 815-15-25-1 and does not meet the requirements for bifurcation. | ||||||
Conversion | ||||||
The Holders may convert their Notes in integral multiples of US$1,000 principle amount at an initial conversion rate of US$19.34 per ADS, at any time prior to the maturity date of September 15, 2017. Upon conversion of the Notes, the Company will deliver shares of the Company’s ADS. The conversion rate is subject to adjustment in certain events, such as distribution of dividends and stock splits. In addition, upon a make-whole fundamental change (as defined in the Indenture), the Company will, under certain circumstances, increase the applicable conversion rate for a holder that elects to convert its Notes in connection with such make-whole fundamental change. | ||||||
In accordance with ASC 815-10-15-83, the conversion option meets the definition of a derivative. However, bifurcation of conversion option from the Notes is not required as the scope exception prescribed in ASC 815-10-15-74 is met as the conversion option is considered indexed to the entity’s own stock and classified in stockholders’ equity. | ||||||
Early conversion of 2017 Convertible Senior Notes | ||||||
The Company offered the public tranche of the 2017 Notes holders to convert their Notes early, through an inducement. The inducement offered included the original term’s ratio for ADS conversion plus a cash incentive of 1.5%-2.0%. As a result of the inducement, US$45.5 million of the Notes was tendered, or 2.35 million ADS at the initial conversion rate of 51.7116 ADS per Note. Total cash paid was $777,445, of which $19,945 represents accrued and unpaid interest and $757,500 represents an inducement premium. This conversion did not materially impact the current shares outstanding. | ||||||
Early termination of Call Option | ||||||
The above early conversion of 2017 Convertible Senior Notes also resulted in an early termination of the Call Option entered into during 2012, of which the Company has received US$ 11.6 million from this early termination. | ||||||
Description of 2018 Convertible Senior Notes | ||||||
On October 17, 2013, the Company issued US$800 million in aggregate principle amount of 1.25% Convertible Senior Notes due October 15, 2018 (the “Notes”) at par. The Notes may be converted, under certain circumstances, based on an initial conversion rate of 12.7568 American depository shares (“ADS”) per US$1,000 principal amount of the Notes (which represents an initial conversion price of US$78.39 per ADS). | ||||||
The net proceeds to the Company from the issuance of the Notes were US$780 million. The Company pays cash interest at an annual rate of 1.25% on the Notes, payable semi-annually in arrears on April 15 and October 15 of each year, beginning April 15, 2014. Debt issuance costs were US$19.6 million and are being amortized to interest expense to the maturity date of the Notes (October 15, 2018). | ||||||
The Notes are general senior unsecured obligations and rank (1) senior in right of payment to any of the Company’s future indebtedness that is expressly subordinated in right of payment to the Notes, (2) equal in right of payment to any of the Company’s future indebtedness and other liabilities of the Company that are not so subordinated, (3) junior in right of payment to any of the Company’s secured indebtedness to the extent of the value of the assets securing such indebtedness and (4) structurally junior to all future indebtedness incurred by the Company’s subsidiaries and their other liabilities (including trade payables). | ||||||
Concurrently with the issuance of the Notes, the Company purchased a call option (“Purchased Call Option”) and sold warrants (“Sold Warrants”). The separate Purchased Call Option and Sold Warrants are structured to reduce the potential future economic dilution associated with the conversion of the Notes and to increase the initial conversion price to US$96.27 per ADS. Each of these components is discussed separately below: | ||||||
Purchase Call Option | ||||||
Counterparty agreed to sell to the Company up to approximately 10.2 million shares of the Company’s ADS, which is the number of ADS initially issuable upon conversion of the Notes in full, at a price of US$78.39 per ADS. The Purchased Call Option will be settled in ADSs and will terminate upon the maturity date of the Notes. Settlement of the Purchased Call Option in ADSs, based on the number of ADSs issued upon conversion of the Notes, on the expiration date would result in the Company receiving shares equivalent to the number of shares issuable by the Company upon conversion of the Notes. Should there be an early termination of the Purchased Call Option, the number of ADSs potentially received by the Company will depend upon 1) the then existing overall market conditions, 2) the Company’s stock price, 3) the volatility of the Company’s stock, and 4) the amount of time remaining before expiration of the convertible note hedge. | ||||||
Sold Warrants | ||||||
The Company received US$77.2 million from the same counterparty from the sale of warrants to purchase up to approximately 10.2 million shares of the Company’s ADS at an exercise price of US$96.27 per ADS. The warrants had an expected life of 5 years and expire on October 15, 2018. At expiration, the Company may, at its option, elect to settle the warrants on a net share basis. As of December 31, 2013, the warrants had not been exercised and remained outstanding. | ||||||
Use of Proceeds | ||||||
The Company used a portion of the net proceeds of the offering to pay the associated cost of the convertible note hedge transaction, after such cost is partially offset by the proceeds to the Company from the sale of the warrant transaction. The remainder of the net proceeds from this offering is planned to be used for other general corporate purposes, including working capital needs and potential acquisitions of complementary businesses, as well as potential ADS repurchases and note retirement from time to time. | ||||||
Evaluation thattransactions should be viewed as a single unit: | ||||||
In accordance with ASC 815-10-15, the Company concluded that the offering of the Notes, Purchased Call Option and the Issued Warrants (1) do not entail the same risks as the Notes involve interest, credit and equity risks, whereas the Purchased Call Option and Issued Warrants transaction was intended to reduce the equity dilution risk for the Company and (2) have a valid business purpose and economic need for structuring the transactions separately as the Company wanted to mitigate future dilution upon conversion of the Notes, as such required that the purchased call option is an American style option which is physical settled whereas the warrant is a European style instrument that allows net share settlement or cash settlement at the choice of the Company. Therefore, the offering of the Notes, Purchased Call Option and Issued Warrants transactions should be accounted for as separate transactions. | ||||||
The Company has accounted for the Notes in accordance with ASC 470, as a single instrument as a long-term debt. The value of the Notes is measured by the cash received. As of December 31, 2013, RMB4.8 billion (US$800 million) is accounted as the value of the Notes in long-term debt. | ||||||
The key terms of the Notes are as follows: | ||||||
Redemption | ||||||
Contingent redemption option | ||||||
The Notes are not redeemable prior to the maturity date of October 15, 2018, except as described below. The holders of the Notes (the “Holders”) have a non-contingent option to require the Company to repurchase for cash all or any portion of their Notes on October 15, 2016. The repurchase price will equal 100% of the principal amount of the Notes to be repurchased plus accrued and unpaid interest, if any, to, but excluding, the repurchase date. If a fundamental change (as defined in the Indenture) occurs prior to the maturity date, the Holders may require the Company to purchase for cash all or any portion of the Notes at a purchase price equal to 100% of the principal amount of the Notes to be purchased plus accrued and unpaid interest, if any, to, but excluding, the fundamental change purchase date. The Holders have the option to require the Company to repurchase the Notes, in whole or in part, in the event of a fundamental change for an amount equal to the 100% of the principal amount and any accrued and unpaid interest in the event of fundamental changes. Management assessed The Company believes that the likelihood of occurrence of events considered a fundamental change is remote. | ||||||
The contingent redemption option is assessed in accordance with ASC 815-15-25-42. The contingent redemption option is considered clearly and closely related to its debt host and does not meet the requirement for bifurcation as the Notes were issued at par and the repurchase feature requires the issuer to settle the option by delivering par plus accrued and unpaid interest, the Notes holder would recover all of their initial investment. Additionally, since the Notes holder can only recover its initial investment upon exercise of its option, there are no interest rate scenarios under which the embedded derivative would at least double the investor’s initial rate of return. | ||||||
Non-contingent redemption option | ||||||
On or after October 15, 2016 (after year 3), the Holders have the right to require the issuer to redeem, at 100% of the loan’s principal amount plus accrued and unpaid interest, in which circumstance the Holders would recover substantially all of their initial investment. | ||||||
Since the Holders can only recover its initial investment upon exercise of its option, there are no interest rate scenarios under which the embedded derivative would at least double the investor’s initial rate of return. Therefore, the embedded repurchase feature (put option) is considered clearly and closely related to the debt host pursuant to ASC 815-15-25-1 and does not meet the requirements for bifurcation. | ||||||
Conversion | ||||||
The Holders may convert their Notes in integral multiples of US$1,000 principle amount at an initial conversion rate of US$78.39 per ADS, at any time prior to the maturity date of October 15, 2018. Upon conversion of the Notes, the Company will deliver shares of the Company’s ADS. The conversion rate is subject to adjustment in certain events, such as distribution of dividends and stock splits. In addition, upon a make-whole fundamental change (as defined in the Indenture), the Company will, under certain circumstances, increase the applicable conversion rate for a holder that elects to convert its Notes in connection with such make-whole fundamental change. | ||||||
In accordance with ASC 815-10-15-83, the conversion option meets the definition of a derivative. However, bifurcation of conversion option from the Notes is not required as the scope exception prescribed in ASC 815-10-15-74 is met as the conversion option is considered indexed to the entity’s own stock and classified in stockholders’ equity. | ||||||
Assessment of Beneficial Conversion Feature and Contingent Beneficial Conversion Feature: | ||||||
As the conversion options are not bifurcated, the Company has assessed the beneficial conversion feature (“BCF”), as of commitment date as defined in ASC 470-20. There was no BCF attribute to the Notes as the set conversion price for the Notes was greater than the fair value of the ordinary share price at date of issuance. | ||||||
The Holders have the option to convert upon a fundamental change, if Holders decide to convert in connection with a fundamental change; the number of shares issuable upon conversion will be increased. The Company will have to assess for the contingent BCF using a measurement date upon issuance of the Notes, upon occurrence of such adjustment. The settlement of the conversion is based on a make-whole provision resulting from a fundamental change, this feature is consistent with ASC 815-40-55-46 (example 19), therefore the Company concludes that this feature is also considered indexed to its own stock. | ||||||
Accounting for Debt Issuance Costs: | ||||||
The debt issuance costs were recorded as deferred issuance costs and are amortized as interest expense, using the effective interest method, over the term of the Notes pursuant to ASC 835-30-35-2. | ||||||
Accounting for Purchased Call Option: | ||||||
In accordance with ASC 815-10-15-83, the Purchased Call Option meets the definition of a derivative instrument. However, the scope exception in accordance with ASC 815-10-15-74 applies to the Purchased Call Option as it is indexed to its own stock, and the Purchased Call Option meets the requirements of ASC 815 and would be classified in stockholders’ equity, therefore, the cost paid for Purchased Call Option was accounted for within stockholders’ equity, and subsequent changes in fair value will not be recorded. | ||||||
Accounting for Issued Warrants: | ||||||
The Company assessed that the Issued Warrants are not liabilities within scope of ASC 480-10-25. The Issued Warrants are legally detachable from the Notes and Purchased Call Option and separately exercisable as such meets the definition of a freestanding derivative instrument pursuant to ASC 815. However, the scope exception in accordance with ASC 815-10-15-74 applies to Warrants and it meets the requirements of ASC 815 that would be classified in stockholders’ equity. Therefore, the Warrants were initially accounted for within stockholders’ equity, and subsequent changes in fair value will not be recorded. |
TREASURY_STOCK
TREASURY STOCK | 12 Months Ended |
Dec. 31, 2013 | |
TREASURY STOCK | ' |
TREASURY STOCK | ' |
18. TREASURY STOCK | |
Accelerated share repurchase arrangement | |
On September 26, 2012, the Company entered into a Capped Call Option Transaction Agreement (the “Agreement”) for an initial notion amount of US$75 million with JP Morgan Chase Bank, National Association. The transaction enables the Company to execute a treasury stock repurchase up to 4.4 million ADSs upon maturity on December 19, 2012. The Agreement consists of two components, a treasure stock repurchase prepayment of US$62,182,346 (purchased call option) with a strike price of US$0.0001 per ADS, plus a warrant (a written call option) with an upper strike price of US$14.3621 per ADS. The total strike notion amount for the Capped Call Option Transaction is US$63,749,958. | |
Upon maturity: | |
· If the ADS trading price is above upper strike price (US$14.3621 per ADS), Ctrip retains a premium of US$1,567,612 and the initial cash prepayment of US$62,182,346 in cash or a number of ADSs that is calculated by dividing the cash settlement amount of US$63,749,958 by the maturity date’s trading price per ADS; | |
· If the ADS trading price is below upper strike price (US$14.3621 per ADS), Ctrip receives a fixed number of 4,438,763 ADSs. | |
The Capped Call Option Transaction meet the criteria for being indexed to the Company’s own stock and is therefore be excluded from the scope of ASC 815. The initial cash payment is recorded within shareholders’ equity as a component of additional paid in capital. | |
On December 19, 2012, the Capped Call Option Transaction expired with cash settlement. The difference between cash settlement and cash prepayment has been accounted for as an equity transaction with the amount recorded in additional paid in capital. As the ADS trading price is above the upper strike price, the Company selected cash settlement of the Capped Call Option amounting to US$63.7 million. | |
In October 2013, US$45.5 million convertible senior notes issued in 2012 were early converted and 588,219 shares of repurchased treasury stock were delivered to the notes holders. As of December 31, 2013, the Company had 3,777,087 shares treasury stock at total cost of US$256 million. |
NONCONTROLLING_INTERESTS
NON-CONTROLLING INTERESTS | 12 Months Ended | |||||
Dec. 31, 2013 | ||||||
NON-CONTROLLING INTERESTS | ' | |||||
NON-CONTROLLING INTERESTS | ' | |||||
19. NON-CONTROLLING INTERESTS | ||||||
As of December 31, 2013, the Company’s majority-owned subsidiaries and VIEs which are consolidated in the consolidated financial statements but with non-controlling interests recognized mainly include Tujia.com International Co., Ltd (“Tujia”) and ezTravel. | ||||||
Non-controlling interests include the common shares in the consolidated subsidiaries or VIE subsidiaries and preferred shares issued by the Company’s subsidiaries. The balance is summarized as follows: | ||||||
December 31, 2012 | December 31, 2013 | |||||
RMB | RMB | |||||
Tujia* | 40,250,981 | 83,133,600 | ||||
ezTravel | 21,269,409 | 21,475,705 | ||||
Others | 33,727,148 | 95,081,123 | ||||
95,247,538 | 199,690,428 | |||||
* In October 2012 and February 2013, a subsidiary of the Company, Tujia, entered into a series of agreements with C-Travel, a wholly owned subsidiary of the Company, and other institutional investors to issue 70,380,000 Series A redeemable convertible preferred shares (“Series A preferred shares”) with total consideration of US$14.6 million and 33,333,333 Series B redeemable convertible preferred shares (“Series B preferred shares”) with total consideration of US$36.7 million. All of the Series A Preferred Shares and the Series B Preferred Shares issued by Tujia are collectively referred to as the “Preferred Shares”. The Company assessed it has the right to consolidate Tujia after the issuance of Series A and B redeemable convertible preferred shares. The shares held by investors other than Ctrip are recorded as non-controlling interests. |
EARNINGS_PER_SHARE
EARNINGS PER SHARE | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
EARNINGS PER SHARE | ' | |||||||
EARNINGS PER SHARE | ' | |||||||
20. EARNINGS PER SHARE | ||||||||
Basic earnings per share and diluted earnings per share were calculated as follows: | ||||||||
2011 | 2012 | 2013 | ||||||
RMB | RMB | RMB | ||||||
Numerator: | ||||||||
Net income attributable to Ctrip’s shareholders | 1,076,414,897 | 714,405,864 | 998,319,684 | |||||
Eliminate the dilutive effect of interest expense of convertible bond | — | 4,617,398 | 15,496,021 | |||||
Numerator for diluted earnings per share | 1,076,414,897 | 719,023,262 | 1,013,815,705 | |||||
Denominator: | ||||||||
Denominator for basic earnings per ordinary share - weighted average ordinary shares outstanding | 35,977,063 | 34,236,761 | 32,905,601 | |||||
Dilutive effect of share options | 2,053,911 | 1,230,941 | 2,359,614 | |||||
Dilutive effect of convertible bond | — | 623,083 | 2,206,157 | |||||
Dilutive effect of convertible bond sold warrants | — | — | 598,469 | |||||
Denominator for diluted earnings per ordinary share | 38,030,974 | 36,090,785 | 38,069,841 | |||||
Basic earnings per ordinary share | 29.92 | 20.87 | 30.34 | |||||
Diluted earnings per ordinary share | 28.3 | 19.92 | 26.63 | |||||
Basic earnings per ADS | 7.48 | 5.22 | 7.58 | |||||
Diluted earnings per ADS | 7.08 | 4.98 | 6.66 | |||||
The 2018 convertible senior notes were not included in the computation of diluted EPS in 2013 because the inclusion of such instrument would be anti-dilutive. | ||||||||
For the years ended December 31, 2011, 2012 and 2013, the Company had securities which could potentially dilute basic earnings per share in the future, which were excluded from the computation of diluted earnings per share as their effects would have been anti-dilutive. Such weighted average numbers of ordinary shares outstanding are as following: | ||||||||
2011 | 2012 | 2013 | ||||||
RMB | RMB | RMB | ||||||
Outstanding weighted average stock options | 715,894 | 1,779,507 | 251,266 | |||||
Sold Warrants | — | 299,319 | 870,425 | |||||
715,894 | 2,078,826 | 1,121,691 |
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended | |||
Dec. 31, 2013 | ||||
COMMITMENTS AND CONTINGENCIES | ' | |||
COMMITMENTS AND CONTINGENCIES | ' | |||
21. COMMITMENTS AND CONTINGENCIES | ||||
Operating lease commitments | ||||
The Company has entered into leasing arrangements relating to office premises that are classified as operating leases for the periods from 2014 to 2018. Future minimum lease payments for non-cancelable operating leases are as follows: | ||||
Office Premises | ||||
RMB | ||||
2014 | 49,445,429 | |||
2015 | 35,829,711 | |||
2016 | 15,077,517 | |||
2017 | 5,155,184 | |||
2018 | 2,395,381 | |||
Thereafter | 610,087 | |||
108,513,309 | ||||
Rental expense amounted to RMB66,208,557, RMB94,213,513 and RMB118,261,449 for the years ended December 31, 2011, 2012 and 2013, respectively. Rental expense is charged to the statements of income and comprehensive income when incurred. | ||||
Capitalcommitments | ||||
As of December 31, 2013, the Company had outstanding capital commitments totaling RMB376 million, which consisted of capital expenditures of property, equipment and software. | ||||
Guarantee | ||||
In connection with our air ticketing business, the Group is required by the Civil Aviation Administration of China, International Air Transport Association, and local airline companies to pay deposits in order to or to provide other guarantees obtain blank air tickets. As of December 31, 2013, the amount under these guarantee arrangements was approximately RMB877 million. | ||||
Based on historical experience and information currently available, we do not believe that it is probable that we will be required to pay any amount under these guarantee arrangements. Therefore, we have not recorded any liability beyond what is required in connection with these guarantee arrangements. | ||||
Contingencies | ||||
The Company is not currently a party to any pending material litigation or other legal proceeding or claims. | ||||
The Company is incorporated in Cayman Islands and is considered as a foreign entity under PRC laws. Due to the restrictions on foreign ownership of the air-ticketing, travel agency, advertising and internet content provision businesses, the Company conducts these businesses partly through various VIEs. These VIEs hold the licenses and approvals that are essential for the Company’s business operations. In the opinion of the Company’s PRC legal counsel, the current ownership structures and the contractual arrangements with these VIEs and their shareholders as well as the operations of these VIEs are in compliance with all existing PRC laws, rules and regulations. However, there may be changes and other developments in PRC laws and regulations. Accordingly, the Company cannot be assured that PRC government authorities will not take a view in the future contrary to the opinion of the Company’s PRC legal counsel. If the current ownership structures of the Company and its contractual arrangements with VIEs were found to be in violation of any existing or future PRC laws or regulations, the Company may be required to restructure its ownership structure and operations in China to comply with changing and new Chinese laws and regulations. |
SUBSEQUENT_EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2013 | |
SUBSEQUENT EVENTS | ' |
SUBSEQUENT EVENTS | ' |
22. SUBSEQUENT EVENTS | |
In January 2014, the Company offered an entrusted loan to one of its related parties, China Lodging Group, Limited, of RMB300 million with maturity of one year, for daily operational purposes. | |
In December 2013, the Company entered into agreements to acquire controlling equity stake of Toursforfun, an online supplier specialized in tours and vacation packages for Chinese traveling abroad with a total consideration of US$23.09 million. As of December 31, 2013, the Company has made a prepayment of US$1 million and recorded it as Prepayments and other current assets. The acquisition was closed in January 2014. |
PRINCIPAL_ACCOUNTING_POLICIES_
PRINCIPAL ACCOUNTING POLICIES (Policies) | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
PRINCIPAL ACCOUNTING POLICIES | ' | |||||||||||||
Basis of presentation | ' | |||||||||||||
Basis of presentation | ||||||||||||||
The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“US GAAP”). | ||||||||||||||
The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the balance sheet dates and the reported amounts of revenues and expenses during the reporting periods. Actual results could materially differ from those estimates. | ||||||||||||||
Consolidation | ' | |||||||||||||
Consolidation | ||||||||||||||
The consolidated financial statements include the financial statements of the Company, its subsidiaries, VIEs and VIEs’ subsidiaries. All significant transactions and balances between the Company, its subsidiaries, VIEs and VIEs’ subsidiaries have been eliminated upon consolidation. | ||||||||||||||
A subsidiary is an entity in which the Company, directly or indirectly, controls more than one half of the voting power; has the power to appoint or remove the majority of the members of the board of directors; to cast a majority of votes at the meeting of the board of directors or to govern the financial and operating policies of the investee under a statute or agreement among the shareholders or equity holders. | ||||||||||||||
The Company has adopted the guidance codified in Accounting Standard Codification 810, Consolidations (“ASC 810”) on accounting for VIEs and their respective subsidiaries, which requires certain variable interest entities to be consolidated by the primary beneficiary of the entity in which it has a controlling financial interest. A VIE is an entity with one or more of the following characteristics: (a) the total equity investment at risk is not sufficient to permit the entity to finance its activities without additional financial support; (b) as a group, the holders of the equity investment at risk lack the ability to make certain decisions, the obligation to absorb expected losses or the right to receive expected residual returns, or (c) an equity investor has voting rights that are disproportionate to its economic interest and substantially all of the entity’s activities are on behalf of the investor. Accordingly, the financial statements of the following VIEs and VIEs’ subsidiaries are consolidated into the Company’s financial statements since July 1, 2003 or their respective date of establishment/acquisition, whichever is later: | ||||||||||||||
The following is a summary of the Company’s major VIEs and VIEs’ subsidiaries: | ||||||||||||||
Name of VIE and VIEs’ subsidiaries | Date of establishment/acquisition | |||||||||||||
Shanghai Ctrip Commerce Co., Ltd. (“Shanghai Ctrip Commerce”) | Established on July 18, 2000 | |||||||||||||
Beijing Ctrip International Travel Agency Co., Ltd. (“Beijing Ctrip”) | Acquired on January 15, 2002 | |||||||||||||
Guangzhou Ctrip International Travel Agency Co., Ltd. (“Guangzhou Ctrip”) | Established on April 28, 2003 | |||||||||||||
Shanghai Ctrip International Travel Agency Co., Ltd. (“Shanghai Ctrip” formerly Shanghai Ctrip Charming International Travel Agency Co., Ltd.) | Acquired on September 23, 2003 | |||||||||||||
Shenzhen Ctrip Travel Agency Co., Ltd. (“Shenzhen Ctrip”) | Established on April 13, 2004 | |||||||||||||
Ctrip Insurance Agency Co., Ltd. (“Ctrip Insurance”) | Established on July 25, 2011 | |||||||||||||
Shanghai Huacheng Southwest Travel Agency Co., Ltd. (“Shanghai Huacheng”) | Established on March 13, 2001 | |||||||||||||
Chengdu Ctrip Travel Agency Co., Ltd. (“Chengdu Ctrip”) | Established on January 8, 2007 | |||||||||||||
Chengdu Ctrip International Travel Agency Co., Ltd. (“Chengdu Ctrip International”) | Established on November 4, 2008 | |||||||||||||
For the years ended December 31, 2011, 2012 and 2013, the Company is considered the primary beneficiary of a VIE or VIEs’ subsidiary and consolidated the VIE or VIEs’ subsidiary if the Company had variable interests, that will absorb the entity’s expected losses, receive the entity’s expected residual returns, or both. | ||||||||||||||
In December 2009, the FASB issued Consolidations—Improvements to Financial Reporting by Enterprises Involved with VIEs which replaced the quantitative-based risks and rewards calculation for determining which reporting entity, if any, has a controlling financial interest in a variable interest entity with an approach focused on identifying which reporting entity has 1) the power to direct the activities of a variable interest entity that most significantly impact the entity’s economic performance and 2) the obligation to absorb losses from or the right to receive benefits of the variable interest entity that could potentially be significant to the VIE. The Company adopted the new requirements effective January 1, 2010 and the adoption did not have a material impact on the Company’s consolidated financial statements for the year ended December 31, 2011, 2012 and 2013. | ||||||||||||||
Major variable interest entities and their subsidiaries | ' | |||||||||||||
Major variable interest entities and their subsidiaries | ||||||||||||||
As of December 31, 2013, the Company conducts a part of its operations through a series of agreements with certain VIEs and VIEs’ subsidiaries as stated in above. These VIEs and VIEs’ subsidiaries are used solely to facilitate the Group’s participation in Internet content provision, advertising business, travel agency and air-ticketing services in the People’s Republic of China (“PRC”) where foreign ownership is restricted. | ||||||||||||||
Shanghai Ctrip Commerce is a domestic company incorporated in Shanghai, the PRC. Shanghai Ctrip Commerce holds a value-added telecommunications business license and is primarily engaged in the provision of advertising business on the Internet website. Two senior officers of the Company collectively hold 100% of the equity interest in Shanghai Ctrip Commerce. The registered capital of Shanghai Ctrip Commerce was RMB30,000,000 as of December 31, 2013. | ||||||||||||||
Beijing Ctrip is a domestic company incorporated in Beijing, the PRC. Beijing Ctrip holds an air transport sales agency license, domestic and cross-border travel agency license and is mainly engaged in the provision of air-ticketing services and packaged tour services. A senior officer of the Company and Shanghai Ctrip Commerce collectively hold 100% of the equity interest in Beijing Ctrip. The registered capital of Beijing Ctrip was RMB40,000,000 as of December 31, 2013. | ||||||||||||||
Guangzhou Ctrip is a domestic company incorporated in Guangzhou, the PRC. Guangzhou Ctrip holds air transport sales agency license, domestic and cross-border travel agency license and is mainly engaged in the provision of air-ticketing services and packaged tour services. Two senior officers of the Company collectively hold 100% of the equity interest in Guangzhou Ctrip. The registered capital of Guangzhou Ctrip was RMB3,000,000 as of December 31, 2013. | ||||||||||||||
Shanghai Ctrip is a domestic company incorporated in Shanghai, the PRC. Shanghai Ctrip holds domestic and cross-border travel agency licenses, air transport sales agency license and mainly provides domestic and cross-border tour services. In September 2012, the Company purchased of the ownership interests from the unrelated minority shareholder and effected a simultaneous reduction of capital of Shanghai Ctrip. Upon completion of the above transactions, a senior officer of the Company control 100% of the equity interest in Shanghai Ctrip. The registered capital of Shanghai Ctrip was RMB10,000,000 as of December 31, 2013. | ||||||||||||||
Shenzhen Ctrip is a domestic company incorporated in Shenzhen, the PRC. Shenzhen Ctrip holds air transport sales | ||||||||||||||
agency license and domestic travel agency license and is engaged in the provision of air-ticketing service. Two senior officers of the Company collectively hold 100% of the equity interest in Shenzhen Ctrip. The registered capital of Shenzhen Ctrip was RMB2,500,000 as of December 31, 2013. | ||||||||||||||
Ctrip Insurance is an insurance agency incorporated in Shanghai, the PRC. Ctrip Insurance was established in July 2011. Ctrip Insurance holds an insurance agency business license. Shanghai Ctrip Commerce and Ctrip Computer Technology (Shanghai) Co., Ltd. (“Ctrip Computer Technology”) hold 100% of the equity interest in Ctrip Insurance. The registered capital of Ctrip Insurance was RMB50,000,000 as of December 31, 2013. | ||||||||||||||
Shanghai Huacheng is a domestic company incorporated in Shanghai, the PRC. Shanghai Huacheng holds a domestic travel agency license and an air transport sales agency license and mainly provides domestic tour services and air-ticketing services. Shanghai Ctrip Commerce holds 100% of the equity interest in Shanghai Huacheng. The registered capital of Shanghai Huacheng was RMB69,950,000 as of December 31, 2013. | ||||||||||||||
Chengdu Ctrip is a domestic company incorporated in Chengdu, the PRC. Chengdu Ctrip holds air transport sales agency license and domestic travel agency license and is engaged in the provision of air-ticketing service. Shanghai Ctrip holds 100% of the equity interest in Chengdu Ctrip. The registered capital of Chengdu Ctrip was RMB11,500,000 as of December 31, 2013. | ||||||||||||||
Chengdu Ctrip International is a domestic company incorporated in Chengdu, the PRC. Chengdu Ctrip International holds domestic and cross-border travel agency licenses, air transport sales agency license and mainly provides domestic and cross-border tour services. Shanghai Ctrip holds 100% of the equity interest in Chengdu Ctrip International. The registered capital of Chengdu Ctrip International was RMB2,000,000 as of December 31, 2013. | ||||||||||||||
The capital injected by senior officers or senior officer’s family member are funded by the Company and are recorded as long-term business loans to related parties. The Company does not have any ownership interest in these VIEs and VIEs’ subsidiaries. | ||||||||||||||
As of December 31, 2013, the Company has various agreements with its consolidated VIEs and VIEs’ subsidiaries, including loan agreements, exclusive technical consulting and services agreements, share pledge agreements, exclusive option agreements and other operating agreements. | ||||||||||||||
Details of certain key agreements with the VIEs are as follows: | ||||||||||||||
Powers of Attorney: Each of the shareholders of our affiliated Chinese entities signed an irrevocable power of attorney to appoint Ctrip Computer Technology (Shanghai) Co., Ltd. or another wholly owned subsidiary of ours, as attorney-in-fact to vote, by itself or any other person to be designated at its discretion, on all matters of our affiliated Chinese entities. Each power of attorney will remain effective during the existence of the applicable affiliated Chinese entity. The Power of Attorney shall remain effective as long as the applicable affiliated Chinese entity exists, and the shareholders of our affiliated Chinese entities are not entitled to terminate or amend the terms of the Power of Attorneys without prior written consent from us. | ||||||||||||||
Amended and Restated Technical Consulting and Services Agreement: Ctrip Computer Technology, Ctrip Travel Network and Ctrip Travel Information provide our affiliated Chinese entities with technical consulting and related services and staff training and information services. We also maintain their network platforms. In consideration for our services, our affiliated Chinese entities agree to pay us service fees as calculated in such manner as determined by us from time to time based on the nature of service, which may be adjusted periodically. For 2013, our affiliated Chinese entities paid Ctrip Computer Technology and Ctrip Travel Network a quarterly fee based on the number of air tickets sold and the number of packaged-tour products sold in the quarter, at an average rate from RMB8 (US$1) to RMB85 (US$14) per ticket and from RMB27 (US$4) to RMB125 (US$21) per person per tour. Although the service fees are typically determined based on the number of air tickets sold and packaged tour products sold, given the fact that the nominee shareholders of our affiliated Chinese entities have irrevocably appointed the employees of our subsidiaries to vote on their behalf on all matters they are entitled to vote on, we have the right to determine the level of service fees paid and therefore receive substantially all of the economic benefits of our affiliated Chinese entities in the form of service fees. The services fees paid by all of our affiliated Chinese entities as a percentage of their total net income were 77.7%, 82.7% and 105.9% for the years ended December 31, 2011, 2012 and 2013. The initial term of these agreements is 10 years and may be renewed automatically in 10-year terms unless we disapprove the extension. We retain the exclusive right to terminate the agreements at any time by delivering a 30-day advance written notice to the applicable affiliate Chinese entity. | ||||||||||||||
Amended and Restated Share Pledge Agreements: The shareholders of our affiliated Chinese entities have pledged their respective equity interests in our affiliated Chinese entities as a guarantee for the performance of all the obligations under the other contractual arrangements, including payment by our affiliated Chinese entities of the technical and consulting services fees to us under the amended and restated technical consulting and services agreements, repayment of the business loan under the amended and restated business loan agreements and performance of obligations under the amended and restated exclusive option agreements, each agreement as described herein. In the event any of our affiliated Chinese entity breaches any of its obligations or any shareholder of our affiliated Chinese entities breaches his/her obligations, as the case may be, under these agreements, we are entitled | ||||||||||||||
to enforce the equity pledge right and sell or otherwise dispose of the pledged equity interests, and retain the proceeds from such sale or require any of them to transfer his or her equity interest without consideration to the PRC citizen(s) designated by us. These amended and restated share pledge agreements came into effect on the day when the respective pledgors became shareholders of our affiliated Chinese entities, and shall expire two years after the pledgor and the affiliated Chinese entities no longer undertake any obligations under the above-referenced agreements. | ||||||||||||||
Amended and Restated Business Loan Arrangements: Under the amended and restated business loan agreements we entered into with the shareholders of our affiliated Chinese entities, we extended long-term business loans to these shareholders of our affiliated Chinese entities with the sole purpose of providing funds necessary for the capitalization or acquisition of our affiliated Chinese entities. These loan amounts were injected into the affiliated Chinese entities as capitals and cannot be accessed for any personal uses. The amended and restated business loan agreements shall remain effective until the parties have fully performed their respective obligations under the agreement, and the shareholders of our affiliated Chinese entities have no right to unilaterally terminate these agreements. In the event that the PRC government lifts its substantial restrictions on foreign ownership of the air-ticketing, travel agency, or value-added telecommunications business in China, as applicable, we will exercise our exclusive option to purchase all of the outstanding equity interests of our affiliated Chinese entities, as described in the following paragraph, and the amended and restated business loan agreements will be cancelled in connection with such purchase. However, it is uncertain when, if at all, the PRC government will lift any or all of these restrictions. | ||||||||||||||
Amended and Restated Exclusive Option Agreements: As consideration for our entering into the amended and restated business loan agreements described above, each of the shareholders of our affiliated Chinese entities has granted us an exclusive, irrevocable option to purchase, or designate one or more person(s) at our discretion to purchase, all of their equity interests in our affiliated Chinese entities at any time we desire, subject to compliance with the applicable PRC laws and regulations. We may exercise the option by issuing a written notice to the relevant affiliated Chinese entity. The purchase price shall be equal to the contribution actually made by the shareholder for the relevant equity interest. Therefore, if we exercise these options, we may choose to cancel the outstanding loans we extended to the shareholders of our affiliated Chinese entities pursuant to the amended and restated business loan agreements as the loans were used solely for equity contribution purposes. The initial term of these agreements is 10 years and may be renewed automatically in 10-year terms unless we disapprove the extension. We retain the exclusive right to terminate the agreements at any time by delivering a written notice to the applicable affiliate Chinese entity. | ||||||||||||||
The affiliated Chinese entities and their shareholders agree not to enter into any transaction that would affect the assets, obligations, rights or operations of the affiliated Chinese entities without the Company’s prior written consent. They also agree to accept the Company’s guidance with respect to day-to-day operations, financial management systems and the appointment and dismissal of key employees. | ||||||||||||||
In addition, the Company also enters into amended and restated technical consulting and services agreements with its majority or wholly owned subsidiaries of the affiliated Chinese entities, such as Chengdu Ctrip and Chengdu Ctrip International, and these subsidiaries pay the Company service fees based on the level of services provided. The existence of such amended and restated technical consulting and services agreements provides the Company with the enhanced ability to transfer economic benefits of these majority or wholly owned subsidiaries of the affiliated Chinese entities to us in exchange for the services provided, and this is in addition to the Company’s existing ability to consolidate and extract the economic benefits of these majority or wholly owned subsidiaries of the affiliated Chinese entities (for instance, the affiliated Chinese entities may cause the economic benefits to be channeled to them in the form of dividends, which then may be further consolidated and absorbed by the Company through the contractual arrangements described above). | ||||||||||||||
Risks in relation to contractual arrangements between the Company’s PRC subsidiaries and its affiliated Chinese entities: | ||||||||||||||
The Company has been advised by Commerce & Finance Law Offices, its PRC legal counsel, that its contractual arrangements with its consolidated VIEs as described in the Company’s annual report are valid, binding and enforceable under the current laws and regulations of China. Based on such legal opinion and the management’s knowledge and experience, the Company believes that its contractual arrangements with its consolidated VIEs are in compliance with current PRC laws and legally enforceable. However, there may be in the event that the affiliated Chinese entities and their respective shareholders fail to perform their contractual obligations, the Company may have to rely on the PRC legal system to enforce its rights. The PRC legal system is based on written statutes. Prior court decisions may be cited for reference but have limited precedential value. Since 1979, PRC legislation and regulations have significantly enhanced the protections afforded to various forms of foreign investments in China. However, since the PRC legal system is still evolving, the interpretations of many laws, regulations and rules are not always uniform and enforcement of these laws, regulations and rules involve uncertainties, which may limit remedies available to us. In addition, any litigation in China may be protracted and result in substantial costs and diversion of resources and management attention. Due to the uncertainties with respect to the PRC legal system, the PRC government authorities may ultimately take a view contrary to the opinion of its PRC legal counsel with respect to the enforceability of the contractual arrangements. | ||||||||||||||
There are, however, substantial uncertainties regarding the interpretation and application of current or future PRC laws and regulations. Accordingly, the Company cannot be assured that the PRC government authorities will not ultimately take a view that is contrary to the Company’s belief and the opinion of its PRC legal counsel. If the contractual arrangements establishing the Company’s VIE structure are found to be in violation of any existing or future PRC laws or regulations, the relevant PRC government authorities will have broad discretion in dealing with such violation, including, without limitation, levying fines, confiscating our income or the income of our affiliated Chinese entities, revoking our business licenses or the business licenses of our affiliated Chinese entities, requiring us and our affiliated Chinese entities to restructure our ownership structure or operations and requiring us or our affiliated Chinese entities to discontinue any portion or all of our value-added telecommunications, air-ticketing, travel agency or advertising businesses. If the imposing of these penalties cause the Company to lose its rights to direct the activities of and receive economic benefits from its VIEs, which in turn may restrict the Company’s ability to consolidate and reflect in its financial statements the financial position and results of operations of its VIEs. | ||||||||||||||
Summary financial information of the Group’s VIEs in the consolidated financial statements | ||||||||||||||
Pursuant to the contractual arrangements with the VIEs, the Company has the power to direct activities of the VIEs, and can have assets transferred freely out of the VIEs without any restrictions. Therefore the Company considers that there is no asset of a consolidated VIE that can be used only to settle obligations of the VIE, except for registered capital and PRC statutory reserves of the VIEs amounting to a total of RMB444 million as of December 31, 2013. As all the consolidated VIEs are incorporated as limited liability companies under the PRC Company Law, creditors of the VIEs do not have recourse to the general credit of the Company for any of the liabilities of the consolidated VIEs. | ||||||||||||||
Summary financial information of the VIEs, which represents consolidated financial information of the VIEs and their respective subsidiaries included in the accompanying consolidated financial statements, is as follows: | ||||||||||||||
As of December 31, | ||||||||||||||
2012 | 2013 | |||||||||||||
RMB | RMB | |||||||||||||
Total assets | 3,724,911,506 | 5,982,258,881 | ||||||||||||
Less: Inter-company receivables | (542,006,382 | ) | (373,041,663 | ) | ||||||||||
Total assets excluding inter-company | 3,182,905,124 | 5,609,217,218 | ||||||||||||
Total liabilities | 2,835,938,149 | 5,287,287,035 | ||||||||||||
Less: Inter-company payables | (564,890,117 | ) | (1,442,636,737 | ) | ||||||||||
Total liabilities excluding inter-company | 2,271,048,032 | 3,844,650,298 | ||||||||||||
As of December 31, 2012 and 2013, the VIEs’ assets mainly consisted of cash and cash equivalent (December 31, 2012: RMB1.4 billion, December 31, 2013: RMB 1.5 billion), short-term investment (December 31, 2012: RMB118 million, December 31, 2013: RMB 1.6 billion), accounts receivables (December 31, 2012: RMB754 million, December 31, 2013: RMB1.1 billion), and prepayments and other current assets (December 31, 2012: RMB534 million, December 31, 2013: RMB912 million). The inter-company receivables of RMB542 million and RMB373 million as of December 31, 2012 and 2013 mainly represented the cash paid by a VIE to one of the Company’s WFOEs for treasury cash management purpose. | ||||||||||||||
As of December 31, 2012 and 2013, the VIEs’ liabilities mainly consisted of advance from customers (December 31, 2012: RMB1.2 billion, December 31, 2013: RMB2.1 billion), accounts payable (December 31, 2012: RMB792 million, December 31, 2013: RMB1.3 billion), taxes payable (December 31, 2012: RMB66 million, December 31, 2013: RMB46 million), salary and welfare payable (December 31, 2012: RMB78 million, December 31, 2013: RMB119 million), other payables and accruals (December 31, 2012: RMB79 million, December 31, 2013: RMB181 million). The inter-company payables as of December 31, 2012 and 2013 were RMB565 million and RMB1.4 billion, respectively, which primarily consisted of the payables due to Ctrip.com (Hong Kong) Limited (“Ctrip HK”), one of the Company’s wholly-owned subsidiaries, for its payment of overseas air tickets and tour packages on behalf of a VIE and another VIEs’ subsidiary and the service fees payable to the WFOEs under the technical consulting and services agreements, which are operational in nature from the VIEs and their subsidiaries’ perspectives. | ||||||||||||||
For the year ended December 31, | ||||||||||||||
2011 | 2012 | 2013 | ||||||||||||
RMB | RMB | RMB | ||||||||||||
Net revenues | 1,923,643,591 | 2,465,286,325 | 3,137,211,893 | |||||||||||
Cost of revenues | 461,223,883 | 644,886,101 | 904,328,902 | |||||||||||
Net income/ (loss) | 206,213,884 | 198,929,052 | (74,463,933 | ) | ||||||||||
As aforementioned, the VIEs mainly conduct air-ticketing, travel agency, advertising and value-added telecommunication businesses. Revenues from VIEs accounted for around 58% of the Company’s total revenues in 2013. The air-ticketing and packaged-tour revenues continued to increase in 2013, primarily driven by the increase in the air-ticketing volume and leisure travel volume. | ||||||||||||||
The VIEs’ net income before the deduction of the inter-company consulting fee charges were RMB956 million, RMB1.1 billion and RMB1.3 billion for the years ended December 31, 2011, 2012 and 2013, respectively. | ||||||||||||||
The amount of service fees paid by all the VIEs as a percentage of the VIEs’ total net income were 77.7%, 82.7%and 105.9% for the years ended December 31, 2011, 2012 and 2013, respectively. | ||||||||||||||
The WFOEs are the sole and exclusive provider of technical consulting and related services and information services for the VIEs. Pursuant to the Exclusive Technical Consulting and Service Agreements, the VIEs pay service fees to the WFOEs based on the VIEs’ actual operating results. The WFOEs are entitled to receive substantially all of the net income and transfer a majority of the economic benefits in the form of service fees from the VIEs and VIEs’ subsidiaries to the WFOEs. The WFOEs did not request service fee payments of RMB201 million, RMB286 million from Chengdu Ctrip and Chengdu Ctrip International during the years ended December 31, 2011 and 2012, respectively, primarily for tax planning purpose. In 2013, Chengdu Ctrip and Chengdu Ctrip International started to pay service fee to WFOEs and the retained earnings of 2013 have been transferred to the WFOEs. For the undistributed earnings of 2011 and 2012, tax planning strategies are in place to support their enterprise income tax free treatment. | ||||||||||||||
Currently there is no contractual arrangement that could require the Company to provide additional financial support to the consolidated VIEs. As the Company is conducting certain business in the PRC mainly through the VIEs, the Company may provide such support on a discretionary basis in the future, which could expose the Company to a loss. | ||||||||||||||
Foreign currencies | ' | |||||||||||||
Foreign currencies | ||||||||||||||
The Group’s reporting currency is RMB. The Company’s operations are conducted through the subsidiaries and VIEs where the local currency is the functional currency and the financial statements of those subsidiaries are translated from their respective functional currencies into RMB. | ||||||||||||||
Transactions denominated in currencies other than functional currencies are translated at the exchange rates quoted by the People’s Bank of China (the “PBOC”), the Hong Kong Association of Banks (the “HKAB”) or major Taiwan banks, prevailing or averaged at the dates of the transaction for PRC and Hong Kong subsidiaries and ezTravel respectively. Gains and losses resulting from foreign currency transactions are included in the consolidated statements of income and comprehensive income. Monetary assets and liabilities denominated in foreign currencies are translated using the applicable exchange rates quoted by the PBOC, HKAB or banks located in Taiwan at the balance sheet dates. All such exchange gains and losses are included in the statements of income. | ||||||||||||||
Assets and liabilities of the group companies are translated from their respective functional currencies to the reporting currency at the exchange rates at the balance sheet dates, equity accounts are translated at historical exchange rates and revenues and expenses are translated at the average exchange rates in effect during the reporting period. The exchange differences for the translation of group companies with non-RMB functional currency into the RMB functional currency are included in foreign currency translation adjustments, which is a separate component of shareholders’ equity on the consolidated financial statements. | ||||||||||||||
Translations of amounts from RMB into US$ are solely for the convenience of the reader and were calculated at the rate of US$1.00 =MB6.0537 on December 31, 2013, representing the certificated exchange rate published by the Federal Reserve Board. No representation is intended to imply that the RMB amounts could have been, or could be, converted, realized or settled into US$ at that rate on December 31, 2013, or at any other rate. | ||||||||||||||
Cash and cash equivalents | ' | |||||||||||||
Cashand cash equivalents | ||||||||||||||
Cash includes currency on hand and deposits held by financial institutions that can be added to or withdrawn without limitation. Cash equivalents represent short-term, highly liquid investments that are readily convertible to known amounts of cash and with original maturities from the date of purchase of generally three months or less. | ||||||||||||||
Restricted cash | ' | |||||||||||||
Restricted cash | ||||||||||||||
Restricted cash represents cash that cannot be withdrawn without the permission of third parties. The Group’s restricted cash is substantially cash balance on deposit required by its business partners and commercial banks. | ||||||||||||||
Short-term investment | ' | |||||||||||||
Short-term investment | ||||||||||||||
Short-term investments represent the investments issued by commercial banks or other financial institutions with a variable interest rate indexed to the performance of underlying assets within one year. The Company elected the fair value method at the date of initial recognition and carried these investments subsequently at fair value. Changes in the fair value are reflected in the consolidated statements of income and comprehensive income. | ||||||||||||||
Long term loan receivable | ' | |||||||||||||
Long term loan receivable | ||||||||||||||
Long-term loan receivables are recorded at cost and compounded accrued interests as we do not intend to sell the security, or it is more likely than not that the company will not be required to sell the security before full recovery of our cost. The company evaluates the qualitative criteria to determine whether we expect to recover our cost. | ||||||||||||||
Land use rights | ' | |||||||||||||
Land use rights | ||||||||||||||
Land use rights represent the prepayments for usage of the parcels of land where the office buildings are located, are recorded at cost, and are amortized over their respective lease periods (usually over 40 to 50 years). | ||||||||||||||
Property, equipment and software | ' | |||||||||||||
Property, equipment and software | ||||||||||||||
Property, equipment and software are stated at cost less accumulated depreciation and amortization. Depreciation and amortization are computed using the straight-line method over the following estimated useful lives, taking into account any estimated residual value: | ||||||||||||||
Building | 20-30 years | |||||||||||||
Leasehold improvements | Lesser of the term of the lease or the estimated useful lives of the assets | |||||||||||||
Website-related equipment | 5 years | |||||||||||||
Computer equipment | 3-5 years | |||||||||||||
Furniture and fixtures | 3-5 years | |||||||||||||
Software | 3-5 years | |||||||||||||
Construction in progress is stated at cost. Construction in progress mainly refers to costs associated with the information and technology center in Chengdu before the buildings are put into service. All direct costs related to the new buildings are capitalized as construction in progress until it is substantially completed and available for use. | ||||||||||||||
Investments | ' | |||||||||||||
Investments | ||||||||||||||
The Company investments include cost method investment, equity method investments and available-for-sale investments in certain publicly traded companies and privately-held companies. | ||||||||||||||
Cost method is used for investments over which the Company does not have the ability to exercise significant influence. Gain or losses are realized when such investments are sold or when dividends are declared or payments are recognized. In October, 2013, the company contributed 5% equity shares in Zhong An Online Property Insurance Co., Ltd. In December 2013, the Company acquired approximately 4% equity shares in Keystone Lodging Holdings Limited (“Keystone”), which in 2013 merged with 7 Days Group Holdings Limited (“7 Days”), a leading economy hotel chain based in China. Cost method of accounting was applied to both transactions due to lack of ability to exercise significant influence (Note 8). | ||||||||||||||
The Company applies equity method in accounting for our investments in entities in which the Company has the ability to exercise significant influence but does not own a majority equity interest or otherwise controls. In 2008, the Company acquired equity interest in Home Inns & Hotels Management Inc. (“Home Inns”) and on May 21, 2009, the Company started to have the ability to exercise significant influence and meeting requirement to apply equity method of accounting (Note 8). In May, 2012, the Company sold 51% equity of Starway Hotels (Hong Kong) Limited (“Starway Hong Kong”) and recorded the 49% of retained non-controlling interests following the equity method of accounting. In November, 2013, the Company further sold the remaining 49% equity interest of Starway Hong Kong (Note 8). In November, 2013, the Company acquired 35% equity shares in Shanghai Yishang Network Technology Co., Ltd(“Yishang Network”) with a cash consideration of RMB13 million along with a contingent consideration, resulting in the Company possessing the ability to exercise significant influence and meeting requirement to apply equity method of accounting (Note 8). Unrealized gains on transactions between the Company and the affiliated entity are eliminated to the extent of the Company’s interest in the affiliated entity; unrealized losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. The Company assesses the contingent consideration on the equity method investments in accordance with ASC 323, “Investments - Equity Method and Joint Ventures”, where the Company assesses the fair value of the investment to determine the contingent consideration to be recorded as liability (Note 8). The initial liability recorded will be part of the equity investment cost, and subsequently upon resolution of the contingency, the fair value of the consideration paid should be compared to the initial liability recorded. If the consideration paid exceeds the liability initially recorded, that amount shall be recognized as an additional cost of the investment, otherwise that amount shall reduce the cost of the investment. | ||||||||||||||
The Company classifies its investments in debt and equity securities into one of three categories and accounts for these as follows: (i) debt securities that the Company has the positive intent and the ability to hold to maturity are classified as “held to maturity” and reported at amortized cost; (ii) debt and equity securities that are bought and held principally for the purpose of selling them in the near term are classified as “trading securities” with unrealized holding gains and losses included in earnings; (iii) debt and equity securities not classified as held to maturity or as trading securities are classified as “available-for-sale” and reported at fair value. The Company has designated its investment in commons shares of China Lodging Group, Limited (“Hanting”) as available-for-sale equity securities and its investment in convertible redeemable preferred shares (“Preferred Share”) of eHi Auto Services Limited(“eHi”), Easy Go Inc.(“Easy Go”), Dining Secretary China Limited (“Dining Secretary”) and Happy City Holdings Limited(“Happy City”) as available-for-sale debt securities in accordance with Accounting Standard Codification (“ASC”) 320-10, respectively (Note 8). Unrealized gains and losses on available-for-sale securities are excluded from earnings and reported as accumulated other comprehensive income (loss), net of tax. Realized gains or losses are charged to earnings during the period in which the gains or losses are realized. | ||||||||||||||
The Company monitors its investments for other-than-temporary impairment by considering factors including, but not limited to, current economic and market conditions, the operating performance of the companies including current earnings trends and other company-specific information. | ||||||||||||||
Fair value measurement of financial instruments | ' | |||||||||||||
Fair value measurement of financial instruments | ||||||||||||||
Financial instruments of the Group primarily comprise of cash and cash equivalents, restricted cash, short-term investments, accounts receivable, due from related parties, available-for-sale investments, accounts payable, due to related parties, advances from customers, short-term bank borrowings, other short-term liabilities and long-term debts. As of December 31, 2012 and 2013, carrying values of these financial instruments except for short-term investments and available-for-sale investments approximated their fair values because of their generally short maturities, and the carrying value of the long-term debts also approximates their fair value, as they bear interest at rates determined based on prevailing interest rates in the market. The Company reports short-term investments and available-for-sale investments at fair value at each balance sheet date and changes in fair value are reflected in the statements of income and comprehensive income. | ||||||||||||||
The Company does not have any financial liabilities which must be measured at fair value on a recurring basis. | ||||||||||||||
We measure our financial assets and liabilities using inputs from the following three levels of the fair value hierarchy. The three levels are as follows: | ||||||||||||||
Level 1 inputs are unadjusted quoted prices in active markets for identical assets that the management has the ability to access at the measurement date. | ||||||||||||||
Level 2 inputs include quoted prices for similar assets in active markets, quoted prices for identical or similar assets in markets that are not active, inputs other than quoted prices that are observable for the asset (i.e., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs). | ||||||||||||||
Level 3 includes unobservable inputs that reflect the management’s assumptions about the assumptions that market participants would use in pricing the asset. The management develops these inputs based on the best information available, including the own data. | ||||||||||||||
Business combination and Acquisitions | ' | |||||||||||||
Business combination | ||||||||||||||
U.S. GAAP requires that all business combinations be accounted for under the purchase method. From January 1, 2009, the Group adopted ASC 805, “Business combinations”. Following this adoption, the cost of an acquisition is measured as the aggregate of the fair values at the date of exchange of the assets given, liabilities incurred, and equity instruments issued. The costs directly attributable to the acquisition are expensed as incurred. Identifiable assets, liabilities and contingent liabilities acquired or assumed are measured separately at their fair value as of the acquisition date, irrespective of the extent of any non-controlling interests. The excess of the (i) the total of cost of acquisition, fair value of the non-controlling interests and acquisition date fair value of any previously held equity interest in the acquiree over (ii) the fair value of the identifiable net assets of the acquiree is recorded as goodwill. If the cost of acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognized directly in the consolidated statements of income and comprehensive income. | ||||||||||||||
The determination and allocation of fair values to the identifiable assets acquired and liabilities assumed is based on various assumptions and valuation methodologies requiring considerable management judgment. The most significant variables in these valuations are discount rates, terminal values, the number of years on which to base the cash flow projections, as well as the assumptions and estimates used to determine the cash inflows and outflows. Management determines discount rates to be used based on the risk inherent in the related activity’s current business model and industry comparisons. Terminal values are based on the expected life of products and forecasted life cycle and forecasted cash flows over that period. Although we believe that the assumptions applied in the determination are reasonable based on information available at the date of acquisition, actual results may differ from the forecasted amounts and the difference could be material. | ||||||||||||||
From January 1, 2009, following the adoption of ASC 810, “Consolidation”, the Company also renamed the minority interests to non-controlling interests and reclassified it on the consolidated balance sheet from the mezzanine section between liabilities and equity to a separate line item in shareholders’ equity. The Company has applied the presentation and disclosure requirements retrospectively for all period presented. | ||||||||||||||
Acquisitions | ||||||||||||||
Wing On Travel | ||||||||||||||
In May 2010, to develop and expand our overseas business, our wholly-owned subsidiary C-Travel, a Cayman Island company, successfully completed the transaction to acquire 90% of the issued share capital of Wing On Travel’s travel service segment, a Hong Kong based travel service provider that offers packaged-tours as well as air tickets and hotel reservation services. We obtained control over Wing On Travel and have consolidated its financial statements since then. The total purchase price for the transaction is approximately RMB598 million (US$88 million). The cash payment is approximately RMB454 million (approximately US$68 million) after the Company assumed net current liability of Wing On Travel as of acquisition date. In February, 2012, Ctrip acquired the remaining 10% of the issued share capital of Wing On Travel’s travel service segment as operated through HKWOT (BVI) Limited, at a consideration of approximately RMB60 million (US$9.4 million). The purchase of the remaining 10% non-controlling interests was initiated by the Company is treated as an equity transaction. The difference between the book value of the 10% non-controlling interests and the cash consideration of Rmb21.7 million was recorded as additional paid in capital. Upon completion of this share purchase, Ctrip holds 100% of the share capital of Wing On Travel. Based on the Company’s assessment, financial results of Wing On Travel is not considered material to the Group for the years ended December 31, 2012 and 2013. | ||||||||||||||
A B2B Hotel Reservation Company | ||||||||||||||
In August, 2013, the Company completed the transaction to acquire controlling shares of a B2B hotel reservation company, through which the Company expects to further enrich its hotel products and to expand in hotel business. The purchase consideration is approximately RMB46 million (US$8 million). The Company makes estimates and judgments in determining the fair value of the acquired assets and liabilities, based in part on independent appraisal reports as well as its experience with purchasing similar assets and liabilities in similar industries. Approximately RMB72 million (US$12 million) excess of the purchase price over the fair value of the identifiable assets and liabilities acquired is recorded as goodwill. The financial results of the acquired entity have been included in the Company’s consolidated financial statements since the acquisition date and were not significant for the Company for the year ended December 31, 2013. | ||||||||||||||
A Wholesaler Operated Hotel Reservation and Air Ticketing Services | ||||||||||||||
In August, 2013, the Company completed the transaction to acquire 100% of the share capital of a wholesaler operated hotel reservation and air ticketing services, which the Company expects to complement its existing business and achieve significant synergies. The purchase consideration is HK$120 million (US$16 million). The Company makes estimates and judgments in determining the fair value of the acquired assets and liabilities, based in part on independent appraisal reports as well as its experience with purchasing similar assets and liabilities in similar industries. Approximately RMB44 million (US$7 million) excess of the purchase price over the fair value of the identifiable assets and liabilities acquired is recorded as goodwill. The financial results of the acquired entity have been included in the Company’s consolidated financial statements since the acquisition date and were not significant for the Company for the years ended December 31, 2013. | ||||||||||||||
Other acquisitions | ||||||||||||||
From time to time, the Company selectively acquired or invested in businesses that complement our existing business, and will continue to do so in the future. Other than disclosed above, none of such acquisitions or investments is material to our businesses or financial results. | ||||||||||||||
Goodwill and other intangible assets | ' | |||||||||||||
Goodwill and other intangible assets | ||||||||||||||
Goodwill represents the excess of the purchase price over the fair value of the identifiable assets and liabilities acquired as a result of the Company’s acquisitions of interests in its subsidiaries and consolidated VIEs. | ||||||||||||||
Goodwill is not amortized but is reviewed at least annually for impairment or earlier, if an indication of impairment exists. Recoverability of goodwill is evaluated using a two-step process. In the first step, the fair value of a reporting unit is compared to its carrying value. If the fair value of a reporting unit exceeds the carrying value of the net assets assigned to a reporting unit, goodwill is considered not impaired and no further testing is required. If the carrying value of the net assets assigned to a reporting unit exceeds the fair value of a reporting unit, the second step of the impairment test is performed in order to determine the implied fair value of a reporting unit’s goodwill. Determining the implied fair value of goodwill requires valuation of a reporting unit’s tangible and intangible assets and liabilities in a manner similar to the allocation of purchase price in a business combination. If the carrying value of a reporting unit’s goodwill exceeds its implied fair value, goodwill is deemed impaired and is written down to the extent of the difference. The Company estimates total fair value of the reporting unit using discounted cash flow analysis, and makes assumptions regarding future revenue, gross margins, working capital levels, investments in new products, capital spending, tax, cash flows, and the terminal value of the reporting unit. | ||||||||||||||
As of December 31, 2013, the step one analysis performed indicated that the fair value of the Company’s reporting units was substantially greater than the respective carrying value. There was no impairment of goodwill during the years ended December 31, 2013, 2012 and 2011. Each quarter the Company reviews the events and circumstances to determine if goodwill impairment may be indicated. | ||||||||||||||
Separately identifiable intangible assets that have determinable lives continue to be amortized and consist primarily of non-compete agreements, customer list, supplier relationship, technology patent and a cross-border travel agency license as of December 31, 2012 and 2013. The Company amortizes intangible assets on a straight-line basis over their estimated useful lives, which is three to ten years. The estimated life of amortized intangibles is reassessed if circumstances occur that indicate the life has changed. Other intangible assets that have indefinite useful life primarily include trademark and domain names as of December 31, 2012 and 2013. The Company evaluates indefinite-lived intangible assets each reporting period to determine whether events and circumstances continue to support an indefinite useful life. If an intangible asset that is not being amortized is subsequently determined to have a finite useful life, the asset is tested for impairment. | ||||||||||||||
The Company reviews intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of these assets may not be recoverable, and also reviews intangible assets with indefinite lives annually for impairment. | ||||||||||||||
No impairment on other intangible assets was recognized for the years ended December 31, 2011, 2012 and 2013. | ||||||||||||||
Impairment of long-lived assets | ' | |||||||||||||
Impairment of long-lived assets | ||||||||||||||
Long-lived assets (including intangible with definite lives) are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Reviews are performed to determine whether the carrying value of asset group is impaired, based on comparison to undiscounted expected future cash flows. If this comparison indicates that there is impairment, the Group recognizes impairment of long-lived assets to the extent the carrying amount of such assets exceeds the fair value. | ||||||||||||||
No impairment of long-lived assets was recognized for the years ended December 31, 2011, 2012, and 2013. | ||||||||||||||
Accrued liability for customer reward program | ' | |||||||||||||
Accrued liability for customer reward program | ||||||||||||||
The Group’s customers participate in a reward program, which provides travel awards and other gifts to members based on accumulated membership points that vary depending on the services rendered and fees paid. The estimated incremental costs to provide free travel and other gifts are recognized as sales and marketing expense in the statements of income and comprehensive income and accrued for as a current liability as members accumulate points. As members redeem awards or their entitlements expire, the accrued liability is reduced correspondingly. As of December 31, 2012, and 2013, the Group’s accrued liability for its customer reward program amounted to RMB218 million and RMB285 million, respectively, based on the estimated liabilities under the customer reward program. Our expenses for the customer rewards program were approximately RMB128 million, RMB157 million and RMB203 million for the years ended December 31, 2011, 2012 and 2013. | ||||||||||||||
Deferred revenue | ' | |||||||||||||
Deferred revenue | ||||||||||||||
In 2011, the Group launched a coupon program, through which the Group provides coupons for customers who book selected hotels online through website. Customers who use the coupons receive credits in their virtual cash accounts upon check-out from the hotels and reviews for hotels submitted. Customers may redeem the amount of credits in their virtual cash account in cash, voucher, or mobile phone credit. In accordance with ASC 605-50 “Revenue Recognition: Customer Payments and Incentives”, the Group accounts for the estimated cost of future usage of coupons as contra-revenue or sales and marketing expenses in the consolidated statements. | ||||||||||||||
Revenue recognition | ' | |||||||||||||
Revenue recognition | ||||||||||||||
The Group conducts its principal businesses in Great China Area primarily through Ctrip Computer Technology (Shanghai) Co., Ltd. (“Ctrip Computer Technology”), Ctrip Travel Information Technology (Shanghai) Co., Ltd. (“Ctrip Travel Information”), Ctrip Travel Network Technology (Shanghai) Co., Ltd. (“Ctrip Travel Network”), Ctrip Information Technology (Nantong) Co., Ltd. (“Ctrip Information Technology”), ezTravel and Wing On Travel. Some of the operations of Ctrip Computer Technology and Ctrip Travel Network are conducted through a series of services and other agreements with the VIEs and VIE subsidiaries. | ||||||||||||||
Ctrip Computer Technology, Ctrip Travel Information, Ctrip Travel Network, Ctrip Information Technology and the VIEs are subject to business tax and related surcharges on the provision of taxable services in the PRC, which include hotel reservation and ticketing services provided to customers. In the statements of income and comprehensive income, business tax and related surcharges are deducted from revenues to arrive at net revenues. | ||||||||||||||
In November 2011, the Ministry of Finance released Circular Caishui [2011] No. 111 mandating Shanghai to carry out a pilot program of tax reform. Effective January 1, 2012, selected entities within modern service industries will switch from a business tax payer to a value-added tax (‘‘VAT’’) payer. In May 2013, the Ministry of Finance released Circular Caishui [2013] No. 37 to extend the tax reform nationwide. Effective August 1, 2013, entities within transportation service and selected modern service industries will switch from a business tax payer to a value-added tax (“VAT”) payer. The Company expects such tax reform will not have material impact on its consolidated financial statements. | ||||||||||||||
Hotel reservation services | ||||||||||||||
The Group receives commissions from travel suppliers for hotel room reservations through the Group’s transaction and service platform. Commissions from hotel reservation services rendered are recognized after hotel customers have completed their stay at the applicable hotel and upon confirmation of pending payment of the commissions by the hotel. Contracts with certain travel suppliers contain incentive commissions typically subject to achieving specific performance targets and such incentive commissions are recognized when it is reasonably assured that the Group is entitled to such incentive commissions. The Group generally receives incentive commissions from monthly arrangements with hotels based on the number of hotel room reservations where customers have completed their stay. The Group presents revenues from such transactions on a net basis in the statements of income and comprehensive income as the Group, generally, does not assume inventory risks and has no obligations for cancelled hotel reservations. | ||||||||||||||
Ticketing services | ||||||||||||||
Ticketing services revenues mainly represent revenues from reservations of air tickets, railway tickets and other related services. The Group receives commissions from travel suppliers for ticketing services through the Group’s transaction and service platform under various services agreements. Commissions from ticketing services rendered are recognized after tickets are issued. The Group presents revenues from such transactions on a net basis in the statements of income as the Group, generally, does not assume inventory risks and has no obligations for cancelled airline ticket reservations. Loss due to obligations for cancelled airline ticket reservations is minimal in the past. | ||||||||||||||
Packaged-tour | ||||||||||||||
The Group receives referral fees from travel product providers for packaged-tour products and services through the Group’s transaction and service platform. Referral fees are recognized as commissions on a net basis after the packaged-tour service are rendered and collections are reasonably assured. | ||||||||||||||
Shanghai Ctrip, Beijing Ctrip, Guangzhou Ctrip, Shenzhen Ctrip and Wing On Travel conduct domestic and cross-border travel tour services. Revenues, mainly referral fees, are recognized as commissions on a net basis after the services are rendered. In cases where these entities undertake the majority of the business risks and acts as principal related to the travel tour services provided, revenues are recognized at gross amounts received from customers after the services are rendered. Loss due to obligations from cancelled travel services of such principal arrangement is minimal in the past. | ||||||||||||||
Corporate travel | ||||||||||||||
Corporate travel management revenues primarily include commissions from air ticket booking, hotel reservation and packaged-tour services rendered to corporate clients. The Group contracts with corporate clients based on service fee model. Travel reservations are made via on-line and off-line services for air tickets, hotel and package-tour. Revenue is recognized on a net basis after the services are rendered, e.g. air tickets are issued, hotel stays or packaged-tour are completed, and collections are reasonably assured. | ||||||||||||||
Other businesses | ||||||||||||||
Other businesses comprise primarily of Internet-related advertising services, the sale of Property Management System (“PMS”), and related maintenance service, commissions from train tickets booking and money exchange transaction services. | ||||||||||||||
Shanghai Ctrip Commerce receives advertising revenues, which principally represent the sale of banners or sponsorship on the website from customers. Advertising revenues are recognized ratably over the fixed term of the agreement as services are provided. | ||||||||||||||
Software Hotel Information conducts sale of PMS and related maintenance service. The sale of PMS is recognized upon customer acceptance. Maintenance service is recognized ratably over the term of the maintenance contract on a straight-line basis. | ||||||||||||||
Allowance for doubtful accounts | ' | |||||||||||||
Allowance for doubtful accounts | ||||||||||||||
Accounts receivable are recorded at the invoiced amount and do not bear interest. The Company reviews on a periodic basis for doubtful accounts for the outstanding trade receivable balances based on historical experience and information available. Additionally, we make specific bad debt provisions based on (i) our specific assessment of the collectability of all significant accounts; and (ii) any specific knowledge we have acquired that might indicate that an account is uncollectible. The facts and circumstances of each account may require us to use substantial judgment in assessing its collectability. The following table summarized the details of the Company’s allowance for doubtful accounts: | ||||||||||||||
2011 | 2012 | 2013 | ||||||||||||
RMB | RMB | RMB | ||||||||||||
Balance at beginning of year | 5,718,742 | 4,974,138 | 4,351,963 | |||||||||||
Provision for doubtful accounts | 185,443 | 376,164 | 2,842,681 | |||||||||||
Write-offs | (930,047 | ) | (998,339 | ) | (1,297,741 | ) | ||||||||
Balance at end of period | 4,974,138 | 4,351,963 | 5,896,903 | |||||||||||
Cost of revenues | ' | |||||||||||||
Cost of revenues | ||||||||||||||
Cost of revenues consists primarily of payroll compensation of customer service center personnel, telecommunication expenses, credit card service fee, direct cost of principal travel tour services, depreciation, rentals and related expenses incurred by the Group’s transaction and service platform which are directly attributable to the rendering of the Group’s travel related services and other businesses. | ||||||||||||||
Product development | ' | |||||||||||||
Product development | ||||||||||||||
Product development expenses include expenses incurred by the Group to develop the Group’s travel supplier networks as well as to maintain, monitor and manage the Group’s transaction and service platform. The Group recognizes website, software and mobile applications development costs in accordance with ASC 350-50 “Website development costs” and ASC 350-40 “Software — internal use software” respectively. The Group expenses all costs that are incurred in connection with the planning and implementation phases of development and costs that are associated with repair or maintenance of the existing websites and mobile applications or the development of software or mobile applications for internal use and websites content. | ||||||||||||||
Sales and marketing | ' | |||||||||||||
Sales and marketing | ||||||||||||||
Sales and marketing expenses consist primarily of costs of payroll and related compensation for the Company’s sales and marketing personnel, advertising expenses, and other related marketing and promotion expenses. Advertising expenses, amounting to RMB163,324,295, RMB275,501,438 and RMB537,757,200 for the years ended December 31, 2011, 2012 and 2013 respectively, are charged to the statements of income as incurred. | ||||||||||||||
Share-based compensation | ' | |||||||||||||
Share-based compensation | ||||||||||||||
Under ASC 718, the Company applied the Black-Scholes valuation model in determining the fair value of options granted. Risk-free interest rates are based on US Treasury yield for the terms consistent with the expected life of award at the time of grant. Expected life is based on historical exercise patterns, for options granted before 2008 which the Company has historical data of and believes are representative of future behavior. For options granted since 2008, the Company used simplified method to estimate its expected life. Expected dividend yield is determined in view of the Company’s historical dividend payout rate and future business plan. The Company estimates expected volatility at the date of grant based on historical volatilities. The Company recognizes compensation expense on all share-based awards on a straight-line basis over the requisite service period. Forfeiture rate is estimated based on historical forfeiture patterns and adjusted to reflect future change in circumstances and facts, if any. If actual forfeitures differ from those estimates, we may need to revise those estimates used in subsequent periods. | ||||||||||||||
ASC 718 requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from initial estimates. Share-based compensation expense was recorded net of estimated forfeitures such that expense was recorded only for those share-based awards that are expected to vest. | ||||||||||||||
According to ASC 718, a change in any of the terms or conditions of stock options shall be accounted for as a modification of the plan. Therefore, the Company calculates incremental compensation cost of a modification as the excess of the fair value of the modified option over the fair value of the original option immediately before its terms are modified, measured based on the share price and other pertinent factors at the modification date. For vested options, the Company would recognize incremental compensation cost in the period the modification occurs and for unvested options, the Company would recognize, over the remaining requisite service period, the sum of the incremental compensation cost and the remaining unrecognized compensation cost for the original award on the modification date. | ||||||||||||||
According to ASC 718, the Company classifies options or similar instruments as liabilities if the entity can be required under any circumstances to settle the option or similar instrument by transferring cash or other assets and such cash settlement is probable. The percentage of the fair value that is accrued as compensation cost at the end of each period shall equal the percentage of the requisite service that has been rendered at that date. Changes in fair value of the liability classified award that occur during the requisite service period shall be recognized as compensation cost over that period. Changes in fair value that occur after the end of the requisite service period are compensation cost of the period in which the changes occur. Any difference between the amount for which a liability award is settled and its fair value at the settlement date as estimated is an adjustment of compensation cost in the period of settlement. | ||||||||||||||
Share incentive plans | ||||||||||||||
On November 5, 2004, the Company’s board of directors adopted a 2005 Employee’s Stock Option Plan (“2005 Option Plan”). The 2005 Option Plan was approved by the shareholders of the Company in October 2005. The Company has reserved 3,000,000 ordinary shares for future issuances of options under the 2005 Option Plan. The terms of the 2005 Option Plan are substantially similar to the Company’s 2003 Option Plan. As of December 31, 2012 and 2013, 829,409 and 587,596 options were outstanding under the 2005 Option Plan respectively. | ||||||||||||||
On October 17, 2007, the Company adopted a 2007 Share Incentive Plan (“2007 Incentive Plan”), which was approved by the shareholders of the Company on June 15, 2007. Under the 2007 Incentive Plan, the maximum aggregate number of shares, which may be issued pursuant to all share-based awards (including Incentive Share Options and Restricted Share Units (“RSU”)), is one million ordinary shares as of the first business day of 2007, plus an annual increase of one million shares to be added on the first business day of each calendar year beginning in 2008 to 2016. Under the 2007 Incentive Plan, the directors may, at their discretion, grant any employees, officers, directors and consultants of the Company and/or its subsidiaries such share-based awards. Shares options granted under 2007 Incentive Plan are vested over a period of 4 years. RSUs granted under 2007 Incentive Plan have a restricted period for 4 years. As of December 31, 2012 and 2013, 3,090,126 and 3,543,136 options and 646,301 and 623,424 RSUs were outstanding under the 2007 Incentive Plan. | ||||||||||||||
Option modification | ||||||||||||||
In February 2009, the Board of Directors approved an option modification to reduce the exercise price of all outstanding unvested options that were granted by the Company in 2007 and 2008 to the then fair market value of ordinary shares underlying such options with a new vesting period ranging from three years to four years. The then fair market value was based on the closing price of our ADSs traded on the Nasdaq as of February 10, 2009, which was the last trading day prior to the board approval. Other terms of the option grants remain unchanged. Total options modified amount to 1.6 million. All eligible option grantees affected by such changes had entered into amendments to their original share option agreements with the Company. The Company took a modification charge for the incremental compensation cost of approximately US$15 million over the remaining vesting periods of three years to four years of the modified options. | ||||||||||||||
In December 2009, the Board of Directors approved an option modification to extend the expiration dates of all stock options granted in 2005 and 2006 to eight years after the respective original grant dates of these options. Other terms of the option grants remain unchanged. Total options modified amount to 0.6 million, which were fully vested. The Company had taken a modification charge for the incremental compensation cost of US$2.6 million in 2009, the period in which the modification occurred. | ||||||||||||||
In February 2010, the compensation committee approved an option modification to extend the expiration dates of all stock options granted in and after 2007 to eight years after the respective original grant dates of these options. Other terms of the option grants remain unchanged. Total options modified amount to 2.8 million, which includes 2.3 million related to the unvested options and 0.5 million related to the vested options. The Company has taken a modification charge for the incremental compensation cost of US$2.2 million in 2010 for fully vested options and expects to take approximately US$2.7 million incremental cost for unvested options over their respective remaining vesting period. | ||||||||||||||
In January 2012, the compensation committee passed a resolution to replace all options that previously granted under the 2007 incentive plan but with exercise price above $120.00 per ordinary share, with maximum of 518,017 restricted share units (RSU) of the Company based on the conversion ratio at 4:1 (“the Replacement”). The total options modified approximate 1.9 million and the Company incurred no incremental cost for such modification. | ||||||||||||||
A summary of option activity under the share option plans | ||||||||||||||
The following table summarized the Company’s share option activity under all the option plans (in US$, except shares): | ||||||||||||||
Number of | Weighted | Weighted | Aggregate | |||||||||||
Shares | Average | Average | Intrinsic | |||||||||||
Exercise | Remaining | Value | ||||||||||||
Price | Contractual | |||||||||||||
Life (Years) | ||||||||||||||
Outstanding at December 31, 2010 | 4,414,481 | 67.71 | 5.98 | 415,360,566 | ||||||||||
Granted | 1,375,345 | 136.86 | ||||||||||||
Exercised | (207,142 | ) | 38.12 | |||||||||||
Forfeited | (149,143 | ) | 115.98 | |||||||||||
Outstanding at December 31, 2011 | 5,433,541 | 85.02 | 5.59 | 144,827,231 | ||||||||||
Granted | 961,980 | 79.55 | ||||||||||||
Exercised | (502,991 | ) | 29.39 | |||||||||||
Forfeited | (71,623 | ) | 136.67 | |||||||||||
Converted to RSU in January 2012 | (1,901,372 | ) | 91.8 | |||||||||||
Outstanding at December 31, 2012 | 3,919,535 | 64.81 | 5.14 | 57,772,345 | ||||||||||
Granted | 945,106 | 79.7 | ||||||||||||
Exercised | (660,459 | ) | 48.05 | |||||||||||
Forfeited | (73,450 | ) | 91.75 | |||||||||||
Outstanding at December 31, 2013 | 4,130,732 | 70.42 | 4.99 | 528,988,489 | ||||||||||
Vested and expect to vest at December 31, 2013 | 3,982,976 | 69.95 | 4.92 | 511,937,931 | ||||||||||
Exercisable at December 31, 2013 | 2,283,785 | 60.18 | 3.58 | 315,856,509 | ||||||||||
The Company’s current practice is to issue new shares to satisfy share option exercises. | ||||||||||||||
The expected-to-vest options are the result of applying the pre-vesting forfeiture rate assumptions of 8% to total unvested options. | ||||||||||||||
The aggregate intrinsic value in the table above represents the total intrinsic value (the aggregate difference between the Company’s closing stock price of US$198.48 as of December 31, 2013 and the exercise price for in-the-money options) that would have been received by the option holders if all in-the-money options had been exercised on December 31, 2013. | ||||||||||||||
The total intrinsic value of options exercised during the years ended December 31, 2011, 2012 and 2013 were US$25 million US$34 million and US$99 million, respectively. | ||||||||||||||
The following table summarizes information related to outstanding and exercisable options as of December 31, 2013 (in US$, except shares): | ||||||||||||||
Outstanding | Exercisable | |||||||||||||
Range of | Number of | Weighted-Average | Weighted-average | Number of | Weighted-Average | Weighted-average | ||||||||
Exercise Prices | shares | Exercise Price | Remaining | shares | Exercise Price | Remaining | ||||||||
Contractual | Contractual | |||||||||||||
Life (Years) | Life (Years) | |||||||||||||
23.00-34.99 | 1,125 | 30.5 | 0.12 | 1,125 | 30.5 | 0.12 | ||||||||
35.00-44.99 | 1,353,069 | 38.06 | 3.08 | 1,353,069 | 38.06 | 3.08 | ||||||||
45.00-58.99 | 157,558 | 58.39 | 1.12 | 157,558 | 58.39 | 1.12 | ||||||||
59.00-77.99 | 1,358,411 | 76.78 | 6.98 | 98,324 | 70.69 | 6.43 | ||||||||
78.00-96.99 | 731,131 | 91.36 | 5.24 | 374,298 | 94.61 | 4.28 | ||||||||
97.00-129.99 | 466,500 | 106.12 | 5.61 | 257,333 | 108.79 | 5.4 | ||||||||
130.00-159.99 | 62,938 | 151.78 | 5.17 | 42,078 | 150.76 | 5.1 | ||||||||
4,130,732 | 2,283,785 | |||||||||||||
The weighted average fair value of options granted during the years ended December 31, 2011, 2012 and 2013 was US$64.79, US$38.01 and US$38.40 per share, respectively. | ||||||||||||||
As of December 31, 2013, there was US$78 million of total unrecognized compensation cost, net of estimated forfeitures, related to unvested share options which are expected to be recognized over a weighted average period of 2.6 year. Total unrecognized compensation cost may be adjusted for future changes in estimated forfeitures. For the year ended December 31, 2013, total cash received from the exercise of share options amounted to RMB180,261,090 (approximately US$30 million). | ||||||||||||||
The Company calculated the estimated fair value of share options on the date of grant using the Black-Scholes pricing model with the following assumptions for the years ended December 31, 2011, 2012 and 2013: | ||||||||||||||
2011 | 2012 | 2013 | ||||||||||||
Risk-free interest rate | 0.81% - 2.11% | 0.71%-1.05% | 0.69%-0.87% | |||||||||||
Expected life (years) | 5 | 5 | 5 | |||||||||||
Expected dividend yield | 0% | 0% | 0% | |||||||||||
Volatility | 53%-55% | 56% | 56% | |||||||||||
Fair value of options at grant date per share | from US$48.69 to US$74.39 | from US$33.44 to US$42.18 | from US$37.96 to US$39.69 | |||||||||||
A summary of RSUs activities under the share option plans | ||||||||||||||
The Company granted 188,407, 164,976 and 259,365 RSUs to employees with 4 year requisite service period for the years ended December 31, 2011, 2012 and 2013, respectively. In additional, pursuant to the Replacement mentioned above, another 475,343 RSUs replaced the 1,901,372 options initially granted under the 2007 incentive plan. | ||||||||||||||
The following table summarized the Company’s RSUs activities under all option plans (in US$, except shares): | ||||||||||||||
Number of | Weighted | |||||||||||||
Shares | average grant | |||||||||||||
date fair | ||||||||||||||
value(US$) | ||||||||||||||
Restricted shares | ||||||||||||||
Outstanding at December 31, 2011 | 190,916 | 130.29 | ||||||||||||
Granted | 164,976 | 82.34 | ||||||||||||
Converted from option in January 2012 | 475,343 | — | ||||||||||||
Exercised | (124,644 | ) | 129.84 | |||||||||||
Forfeited | (60,290 | ) | 128.27 | |||||||||||
Unvested at December 31, 2012 | 646,301 | 101.3 | * | |||||||||||
Granted | 259,365 | 79.23 | ||||||||||||
Exercised | (224,939 | ) | 118.54 | |||||||||||
Forfeited | (57,303 | ) | 85.4 | |||||||||||
Unvested at December 31, 2013 | 623,424 | 83.6 | * | |||||||||||
* It does not include the impact of restricted shares converted from option. | ||||||||||||||
Total share-based compensation cost for the RSUs amounted to US$22.5million, US$12.5 million and US$13.2 million for the years ended December 31, 2011, 2012 and 2013, respectively. As of December 31, 2013, there was US$31 million unrecognized compensation cost, net of estimated forfeitures, related to unvested restricted shares, which are to be recognized over a weighted average vesting period of 2.3 years. Total unrecognized compensation cost may be adjusted for future changes in estimated forfeitures. | ||||||||||||||
Operating leases | ' | |||||||||||||
Operating leases | ||||||||||||||
Leases where substantially all the rewards and risks of ownership of assets remain with the leasing company are accounted for as operating leases. Payments made under operating leases net of any incentives received by the Group from the leasing company are charged to the statements of income on a straight-line basis over the lease periods. | ||||||||||||||
Taxation | ' | |||||||||||||
Taxation | ||||||||||||||
Deferred income taxes are provided using the balance sheet liability method. Under this method, deferred income taxes are recognized for the tax consequences of significant temporary differences by applying enacted statutory rates applicable to future years to differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities. The tax base of an asset or liability is the amount attributed to that asset or liability for tax purposes. The effect on deferred taxes of a change in tax rates is recognized in income in the period enacted. A valuation allowance is provided to reduce the amount of deferred tax assets if it is considered unlikely that some portion of, or all of, the deferred tax assets will not be realized. | ||||||||||||||
Effective January 1, 2007, the Company adopted ASC 740, “Income Taxes”. It clarifies the accounting for uncertainty in income taxes recognized in the Company’s consolidated financial statements and prescribes a more likely than not threshold for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. It also provides guidance on derecognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, accounting for interest and penalties associated with tax positions, accounting for income taxes in interim periods, and income tax disclosures. | ||||||||||||||
As of both December 31, 2012 and 2013, the Company did not record any liability for uncertain tax positions. The Company’s policy is to recognize, if any, tax related interest as interest expenses and penalties as general and administrative expenses. For 2013, the Company did not have any interest and penalties associated with tax positions. | ||||||||||||||
Other income (net) | ' | |||||||||||||
Other income(net) | ||||||||||||||
Other income primarily consists of financial subsidies, investment income and foreign exchange gains/(losses). Financial subsidies from local PRC government authority were recorded as other income in the consolidated statements of income. There are no defined rules and regulations to govern the criteria necessary for companies to enjoy such benefits and the amount of financial subsidy are determined at the discretion of the relevant government authority. Financial subsidies are recognized as other income when received. Components of other income for the years ended December 31, 2011, 2012 and 2013 were as follows: | ||||||||||||||
2011 | 2012 | 2013 | ||||||||||||
RMB | RMB | RMB | ||||||||||||
Financial subsidies | 72,791,093 | 90,280,139 | 119,697,248 | |||||||||||
Foreign exchange gains/(losses) | 34,879,388 | (9,781,057 | ) | 32,523,857 | ||||||||||
Reimbursement from the depository | 8,080,557 | 7,914,706 | 17,507,842 | |||||||||||
Loss from disposal of property, equipment and software | (3,379,449 | ) | (653,191 | ) | (11,946,443 | ) | ||||||||
Gain on disposal of cost method investment | — | — | 4,014,829 | |||||||||||
Gain on disposal of equity investment | — | — | 592,742 | |||||||||||
Gain on deconsolidation of subsidiaries | — | 44,432,052 | — | |||||||||||
Others | 5,252,136 | (1,904,706 | ) | 732,299 | ||||||||||
Total | 117,623,725 | 130,287,943 | 163,122,374 | |||||||||||
Statutory reserves | ' | |||||||||||||
Statutory reserves | ||||||||||||||
The Company’s PRC subsidiaries and the VIEs are required to allocate at least 10% of their after-tax profit to the general reserve in accordance with the PRC accounting standards and regulations. The allocation to the general reserve can be stopped if such reserve has reached 50% of the registered capital of each company. Appropriations to the enterprise expansion fund, staff welfare and bonus fund are at the discretion of the board of directors of Ctrip Computer Technology, Ctrip Travel Information, Ctrip Travel Network, Ctrip Information Technology and Software Hotel Information, the subsidiaries of the Company. Appropriations to discretionary surplus reserve are at the discretion of the board of directors of the VIEs. These reserves can only be used for specific purposes and are not transferable to the Company in form of loans, advances, or cash dividends. During the years ended December 31, 2011, 2012, and 2013, appropriations to statutory reserves have been made of RMB3,408,849, RMB3,371,696, and RMB13,500,462, respectively. The Company’s subsidiary in Taiwan, ezTravel, is required to allocate 10% of its after-tax profit to the statutory reserve in accordance with the Taiwan regulations. During the years ended December 31, 2012 and 2013, appropriations to statutory reserves equivalent to RMB1,801,148, and RMB1,726,256 have been made, respectively. There is no such regulation of providing statutory reserve in Hong Kong. | ||||||||||||||
Dividends | ' | |||||||||||||
Dividends | ||||||||||||||
Dividends are recognized when declared. | ||||||||||||||
PRC regulations currently permit payment of dividends only out of accumulated profits as determined in accordance with PRC accounting standards and regulations. The Company’s PRC subsidiaries can only distribute dividends after they have met the PRC requirements for appropriation to statutory reserves. Additionally, as the Company does not have any direct ownership in the VIEs, the VIEs cannot directly distribute dividends to the Company. The PRC government imposes control over its foreign currency reserves in part through direct regulation of the conversion of RMB into foreign exchange and through restrictions on foreign trade. As substantially all of our revenues are in RMB, any restrictions on currency exchange may limit our ability to use revenue generated in RMB to fund our business activities outside China or to make dividend payments in U.S. dollars. Restricted net assets of the Company’s PRC subsidiaries and VIEs not distributable in the form of dividends to the parent as a result of the aforesaid PRC regulations and other restrictions were RMB1.3 billion as of December 31, 2013. | ||||||||||||||
As a result of the aforementioned PRC regulation and the Company’s organizational structure, accumulated profits of the subsidiaries in PRC distributable in the form of dividends to the parent as of December 31, 2011, 2012 and 2013 were RMB2.9 billion, RMB3.6 billion and RMB4.6 billion, respectively. The Company’s PRC subsidiaries and VIEs are able to enter into royalty and trademark license agreements or certain other contractual arrangements at the discretion of the Company without third party consent, for which the compensatory element of the arrangement is excluded from the accumulated profits. | ||||||||||||||
Effective January 1, 2008, current CIT Law imposes a 10% withholding income tax for dividends distributed by foreign invested enterprises to their immediate holding companies outside mainland China. A lower withholding tax rate will be applied if there is a tax treaty arrangement between mainland China and the jurisdiction of the foreign holding company. Distributions to holding companies in Hong Kong that satisfy certain requirements specified by PRC tax authorities, for example, will be subject to a 5% withholding tax rate. | ||||||||||||||
On June 13, 2012, the Company announced that the board of the Company has approved dividend distribution of US$300 million from its PRC subsidiaries to fund a new share repurchase program whereby Ctrip may purchase its own American depositary shares (“ADSs”). This dividend distribution was a one-time event out of the Company’s normal business course, and withholding tax is recorded only for such transaction accordingly. The PRC withholding tax amounted US$15 million was recorded in the Company’s 2012 financial results (Note 15). | ||||||||||||||
Earnings per share | ' | |||||||||||||
Earnings per share | ||||||||||||||
In accordance with “Computation of Earnings Per Share”, basic earnings per share is computed by dividing net income attributable to common shareholders by the weighted average number of common shares outstanding during the year. Diluted earnings per share is calculated by dividing net income attributable to common shareholders as adjusted for the effect of dilutive ordinary equivalent shares, if any, by the weighted average number of ordinary and dilutive ordinary equivalent shares outstanding during the year. Dilutive ordinary equivalent shares consist of ordinary shares issuable upon the exercise of outstanding share options (using the treasury stock method). | ||||||||||||||
Treasury stock | ' | |||||||||||||
Treasury stock | ||||||||||||||
On July 30, 2008 and September 30, 2008 our board of directors and shareholders respectively approved a US$15 million share repurchase plan. On September 29, 2011, our board of directors approved another US$100 million share repurchase plan. And on June 13, 2012, our board of directors approved a US$300 million share repurchase plan. The share-repurchase programs do not require the Company to acquire a specific number of shares and may be suspended or discontinued at any time. | ||||||||||||||
Treasury stock consists of ADS repurchased by the Group under these three plans. In October 2013, US$45.5 million convertible senior notes issued in 2012 was early converted and 588,219 shares of repurchased treasury stock were delivered to bond holders. As of December 31, 2013, the Company had 3,777,087 shares treasury stock at total cost of US$256 million. Treasury stock is accounted for under the cost method. | ||||||||||||||
Segment reporting | ' | |||||||||||||
Segment reporting | ||||||||||||||
The Company operates and manages its business as a single segment. In accordance with“Disclosures about Segment of an Enterprise and Related Information”, the Company’s chief operating decision-maker has been identified as the CEO, who reviews operating results to make decisions about allocating resources and assessing performance for the entire company. Since the Company operates in one reportable segment, all financial segment and product information required by this statement can be found in the Consolidated Statements. | ||||||||||||||
The Company primarily generates its revenues from customers in Great China Area, and assets of the Company are also located in Great China Area. Accordingly, no geographical segments are presented. | ||||||||||||||
Reclassifications | ' | |||||||||||||
Reclassifications | ||||||||||||||
Certain reclassifications have been made to the prior year’s consolidated financial statements to conform to the current year’s presentation and had no impact on net income/(loss) or total shareholders’ equity. | ||||||||||||||
Recent accounting pronouncements | ' | |||||||||||||
Recent accounting pronouncements | ||||||||||||||
In July 2012, the FASB issued ASU 2012-02, “Intangibles — Goodwill and Other: Testing Indefinite Lived Intangible Assets for Impairment”. The Update applies to all entities, both public and nonpublic, that have indefinite-lived intangible assets, other than goodwill, reported in their financial statements. Per the Update, an entity has the option first to assess qualitative factors to determine whether the existence of events and circumstances indicates that it is more likely than not that the indefinite-lived intangible asset is impaired. If, after assessing the totality of events and circumstances, an entity concludes that it is not more likely than not that the indefinite-lived intangible asset is impaired, then the entity is not required to take further action. The amendments are effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012. The assessment of qualitative factors is optional and at our discretion, the Group bypassed the qualitative assessment as of December 31, 2013 and performed the first step of the quantitative goodwill and intangible assets impairment test. | ||||||||||||||
In February 2013, the FASB issued ASU 2013-02, “Comprehensive Income: Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income”. This Update does not change the current requirements for reporting net income or other comprehensive income in financial statements. However, this Update requires an entity to provide information about the amounts reclassified out of accumulated other comprehensive income by component. In addition, an entity is required to present, either on the face of the statement where net income is presented or in the notes, significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income but only if the amount reclassified is required under U.S. GAAP to be reclassified to net income in its entirety in the same reporting period. For other amounts that are not required under U.S. GAAP to be reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures required under U.S. GAAP that provide additional detail about those amounts. This Update is effective prospectively for reporting periods beginning after December 15, 2012 for public entities. The Company adopted ASU 2013-02 effective January 1, 2013. Such adoption did not have a material effect on the Company’s financial position or results of operations. | ||||||||||||||
In March of 2013, the FASB issued ASU 2013-05, “Foreign Currency Matters (Topic 830), Parent’s Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity.” The amendments clarify the applicable guidance for the release of the cumulative translation adjustment when 1. an entity ceases to have a controlling financial interest in a subsidiary or group of assets that is a nonprofit activity or a business (other than a sale of in substance real estate or conveyance of oil and gas mineral rights) within a foreign entity; 2. there is a loss of a controlling financial interest in a foreign entity or a step acquisition involving an equity method investment that is a foreign entity; and 3. sales or transfers of a controlling financial interest within a foreign entity is the same irrespective of whether the sale or transfer is of a subsidiary or a group of assets (other than a sale of in substance real estate or conveyance of oil and gas mineral rights) that is a nonprofit activity or business. The amendments are effective prospectively for fiscal years (and interim reporting periods within those years) beginning after December 15, 2013. The amendments should be applied prospectively to derecognition events occurring after the effective date. Prior periods should not be adjusted. If an entity elects to early adopt the amendments, it should apply them as of the beginning of the entity’s fiscal year of adoption. The Company does not expect ASU 2013-05 to have a significant impact on the Group’s consolidated result of operations and financial condition. | ||||||||||||||
In March of 2013, the FASB issued ASU 2013-11, “Income Taxes (Topic 740) Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists”. The amendment clarifies that an unrecognized tax benefit, or a portion of an unrecognized tax benefit, should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward, except as follows. To the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. The assessment of whether a deferred tax asset is available is based on the unrecognized tax benefit and deferred tax asset that exist at the reporting date and should be made presuming disallowance of the tax position at the reporting date. The amendments are effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. The amendments should be applied prospectively to all unrecognized tax benefits that exist at the effective date. The Company does not expect ASU 2013-11 to have a significant impact on the Group’s consolidated result of operations and financial condition. | ||||||||||||||
Certain risks and concentration | ' | |||||||||||||
Certain risks and concentration | ||||||||||||||
Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and cash equivalents, restricted cash, short-term investment, accounts receivable, amounts due from related parties, prepayments and other current assets. As of December 31, 2011, 2012 and 2013, substantially all of the Company’s cash and cash equivalents, restricted cash and short-term investment were held in major financial institutions located in the PRC and in Hong Kong, which management considers to be of high credit quality. Accounts receivable are generally unsecured and denominated in RMB, and are derived from revenues earned from operations arising primarily in the PRC. | ||||||||||||||
No individual customer accounted for more than 10% of net revenues for the years ended December 31, 2011, 2012 and 2013. No individual customer accounted for more than 10% of accounts receivable as of December 31, 2012 and 2013. |
PRINCIPAL_ACCOUNTING_POLICIES_1
PRINCIPAL ACCOUNTING POLICIES (Tables) | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
PRINCIPAL ACCOUNTING POLICIES | ' | |||||||||||||
Company's major VIEs and VIE's subsidiaries | ' | |||||||||||||
Name of VIE and VIEs’ subsidiaries | Date of establishment/acquisition | |||||||||||||
Shanghai Ctrip Commerce Co., Ltd. (“Shanghai Ctrip Commerce”) | Established on July 18, 2000 | |||||||||||||
Beijing Ctrip International Travel Agency Co., Ltd. (“Beijing Ctrip”) | Acquired on January 15, 2002 | |||||||||||||
Guangzhou Ctrip International Travel Agency Co., Ltd. (“Guangzhou Ctrip”) | Established on April 28, 2003 | |||||||||||||
Shanghai Ctrip International Travel Agency Co., Ltd. (“Shanghai Ctrip” formerly Shanghai Ctrip Charming International Travel Agency Co., Ltd.) | Acquired on September 23, 2003 | |||||||||||||
Shenzhen Ctrip Travel Agency Co., Ltd. (“Shenzhen Ctrip”) | Established on April 13, 2004 | |||||||||||||
Ctrip Insurance Agency Co., Ltd. (“Ctrip Insurance”) | Established on July 25, 2011 | |||||||||||||
Shanghai Huacheng Southwest Travel Agency Co., Ltd. (“Shanghai Huacheng”) | Established on March 13, 2001 | |||||||||||||
Chengdu Ctrip Travel Agency Co., Ltd. (“Chengdu Ctrip”) | Established on January 8, 2007 | |||||||||||||
Chengdu Ctrip International Travel Agency Co., Ltd. (“Chengdu Ctrip International”) | Established on November 4, 2008 | |||||||||||||
Consolidation balance sheet information of VIEs | ' | |||||||||||||
As of December 31, | ||||||||||||||
2012 | 2013 | |||||||||||||
RMB | RMB | |||||||||||||
Total assets | 3,724,911,506 | 5,982,258,881 | ||||||||||||
Less: Inter-company receivables | (542,006,382 | ) | (373,041,663 | ) | ||||||||||
Total assets excluding inter-company | 3,182,905,124 | 5,609,217,218 | ||||||||||||
Total liabilities | 2,835,938,149 | 5,287,287,035 | ||||||||||||
Less: Inter-company payables | (564,890,117 | ) | (1,442,636,737 | ) | ||||||||||
Total liabilities excluding inter-company | 2,271,048,032 | 3,844,650,298 | ||||||||||||
Consolidation results of operations information of VIEs | ' | |||||||||||||
For the year ended December 31, | ||||||||||||||
2011 | 2012 | 2013 | ||||||||||||
RMB | RMB | RMB | ||||||||||||
Net revenues | 1,923,643,591 | 2,465,286,325 | 3,137,211,893 | |||||||||||
Cost of revenues | 461,223,883 | 644,886,101 | 904,328,902 | |||||||||||
Net income/ (loss) | 206,213,884 | 198,929,052 | (74,463,933 | ) | ||||||||||
Property, equipment and software, estimated useful lives | ' | |||||||||||||
Building | 20-30 years | |||||||||||||
Leasehold improvements | Lesser of the term of the lease or the estimated useful lives of the assets | |||||||||||||
Website-related equipment | 5 years | |||||||||||||
Computer equipment | 3-5 years | |||||||||||||
Furniture and fixtures | 3-5 years | |||||||||||||
Software | 3-5 years | |||||||||||||
Allowance for doubtful accounts | ' | |||||||||||||
2011 | 2012 | 2013 | ||||||||||||
RMB | RMB | RMB | ||||||||||||
Balance at beginning of year | 5,718,742 | 4,974,138 | 4,351,963 | |||||||||||
Provision for doubtful accounts | 185,443 | 376,164 | 2,842,681 | |||||||||||
Write-offs | (930,047 | ) | (998,339 | ) | (1,297,741 | ) | ||||||||
Balance at end of period | 4,974,138 | 4,351,963 | 5,896,903 | |||||||||||
Company's share option activity under all the option plans | ' | |||||||||||||
The following table summarized the Company’s share option activity under all the option plans (in US$, except shares): | ||||||||||||||
Number of | Weighted | Weighted | Aggregate | |||||||||||
Shares | Average | Average | Intrinsic | |||||||||||
Exercise | Remaining | Value | ||||||||||||
Price | Contractual | |||||||||||||
Life (Years) | ||||||||||||||
Outstanding at December 31, 2010 | 4,414,481 | 67.71 | 5.98 | 415,360,566 | ||||||||||
Granted | 1,375,345 | 136.86 | ||||||||||||
Exercised | (207,142 | ) | 38.12 | |||||||||||
Forfeited | (149,143 | ) | 115.98 | |||||||||||
Outstanding at December 31, 2011 | 5,433,541 | 85.02 | 5.59 | 144,827,231 | ||||||||||
Granted | 961,980 | 79.55 | ||||||||||||
Exercised | (502,991 | ) | 29.39 | |||||||||||
Forfeited | (71,623 | ) | 136.67 | |||||||||||
Converted to RSU in January 2012 | (1,901,372 | ) | 91.8 | |||||||||||
Outstanding at December 31, 2012 | 3,919,535 | 64.81 | 5.14 | 57,772,345 | ||||||||||
Granted | 945,106 | 79.7 | ||||||||||||
Exercised | (660,459 | ) | 48.05 | |||||||||||
Forfeited | (73,450 | ) | 91.75 | |||||||||||
Outstanding at December 31, 2013 | 4,130,732 | 70.42 | 4.99 | 528,988,489 | ||||||||||
Vested and expect to vest at December 31, 2013 | 3,982,976 | 69.95 | 4.92 | 511,937,931 | ||||||||||
Exercisable at December 31, 2013 | 2,283,785 | 60.18 | 3.58 | 315,856,509 | ||||||||||
Information related to outstanding and exercisable options | ' | |||||||||||||
The following table summarizes information related to outstanding and exercisable options as of December 31, 2013 (in US$, except shares): | ||||||||||||||
Outstanding | Exercisable | |||||||||||||
Range of | Number of | Weighted-Average | Weighted-average | Number of | Weighted-Average | Weighted-average | ||||||||
Exercise Prices | shares | Exercise Price | Remaining | shares | Exercise Price | Remaining | ||||||||
Contractual | Contractual | |||||||||||||
Life (Years) | Life (Years) | |||||||||||||
23.00-34.99 | 1,125 | 30.5 | 0.12 | 1,125 | 30.5 | 0.12 | ||||||||
35.00-44.99 | 1,353,069 | 38.06 | 3.08 | 1,353,069 | 38.06 | 3.08 | ||||||||
45.00-58.99 | 157,558 | 58.39 | 1.12 | 157,558 | 58.39 | 1.12 | ||||||||
59.00-77.99 | 1,358,411 | 76.78 | 6.98 | 98,324 | 70.69 | 6.43 | ||||||||
78.00-96.99 | 731,131 | 91.36 | 5.24 | 374,298 | 94.61 | 4.28 | ||||||||
97.00-129.99 | 466,500 | 106.12 | 5.61 | 257,333 | 108.79 | 5.4 | ||||||||
130.00-159.99 | 62,938 | 151.78 | 5.17 | 42,078 | 150.76 | 5.1 | ||||||||
4,130,732 | 2,283,785 | |||||||||||||
Assumptions of Black-Scholes pricing model | ' | |||||||||||||
2011 | 2012 | 2013 | ||||||||||||
Risk-free interest rate | 0.81% - 2.11% | 0.71%-1.05% | 0.69%-0.87% | |||||||||||
Expected life (years) | 5 | 5 | 5 | |||||||||||
Expected dividend yield | 0% | 0% | 0% | |||||||||||
Volatility | 53%-55% | 56% | 56% | |||||||||||
Fair value of options at grant date per share | from US$48.69 to US$74.39 | from US$33.44 to US$42.18 | from US$37.96 to US$39.69 | |||||||||||
Schedule of restricted share activities under all option plans | ' | |||||||||||||
The following table summarized the Company’s RSUs activities under all option plans (in US$, except shares): | ||||||||||||||
Number of | Weighted | |||||||||||||
Shares | average grant | |||||||||||||
date fair | ||||||||||||||
value(US$) | ||||||||||||||
Restricted shares | ||||||||||||||
Outstanding at December 31, 2011 | 190,916 | 130.29 | ||||||||||||
Granted | 164,976 | 82.34 | ||||||||||||
Converted from option in January 2012 | 475,343 | — | ||||||||||||
Exercised | (124,644 | ) | 129.84 | |||||||||||
Forfeited | (60,290 | ) | 128.27 | |||||||||||
Unvested at December 31, 2012 | 646,301 | 101.3 | * | |||||||||||
Granted | 259,365 | 79.23 | ||||||||||||
Exercised | (224,939 | ) | 118.54 | |||||||||||
Forfeited | (57,303 | ) | 85.4 | |||||||||||
Unvested at December 31, 2013 | 623,424 | 83.6 | * | |||||||||||
* It does not include the impact of restricted shares converted from option. | ||||||||||||||
Components of other income | ' | |||||||||||||
2011 | 2012 | 2013 | ||||||||||||
RMB | RMB | RMB | ||||||||||||
Financial subsidies | 72,791,093 | 90,280,139 | 119,697,248 | |||||||||||
Foreign exchange gains/(losses) | 34,879,388 | (9,781,057 | ) | 32,523,857 | ||||||||||
Reimbursement from the depository | 8,080,557 | 7,914,706 | 17,507,842 | |||||||||||
Loss from disposal of property, equipment and software | (3,379,449 | ) | (653,191 | ) | (11,946,443 | ) | ||||||||
Gain on disposal of cost method investment | — | — | 4,014,829 | |||||||||||
Gain on disposal of equity investment | — | — | 592,742 | |||||||||||
Gain on deconsolidation of subsidiaries | — | 44,432,052 | — | |||||||||||
Others | 5,252,136 | (1,904,706 | ) | 732,299 | ||||||||||
Total | 117,623,725 | 130,287,943 | 163,122,374 |
PREPAYMENTS_AND_OTHER_CURRENT_1
PREPAYMENTS AND OTHER CURRENT ASSETS (Tables) | 12 Months Ended | |||||
Dec. 31, 2013 | ||||||
PREPAYMENTS AND OTHER CURRENT ASSETS | ' | |||||
Components of prepayments and other current assets | ' | |||||
2012 | 2013 | |||||
RMB | RMB | |||||
Prepayments and deposits to vendors | 644,317,439 | 1,083,771,955 | ||||
Interest receivable | 36,543,547 | 55,861,029 | ||||
Receivables from financial institution | 14,368,206 | 28,303,638 | ||||
Employee advances | 3,676,848 | 10,476,537 | ||||
Prepayments for property and equipment | 7,885,594 | 4,575,720 | ||||
Receivables related to Capped Call Option (Note 18) | 264,779,132 | — | ||||
Others | 22,249,774 | 32,767,408 | ||||
Total | 993,820,540 | 1,215,756,287 |
LONGTERM_DEPOSITS_AND_PREPAYME1
LONG-TERM DEPOSITS AND PREPAYMENTS (Tables) | 12 Months Ended | |||||
Dec. 31, 2013 | ||||||
LONG-TERM DEPOSITS AND PREPAYMENTS | ' | |||||
Components of long-term deposits and prepayments | ' | |||||
2012 | 2013 | |||||
RMB | RMB | |||||
Prepayments for fixed assets | 15,499,330 | 263,626,283 | ||||
Unamortized debt issuance cost | 32,396,007 | 127,815,384 | ||||
Deposits paid to airline suppliers | 126,190,327 | 127,011,881 | ||||
Deposit paid to lessor | 18,413,764 | 15,161,665 | ||||
Deposit paid to travel bureau | 110,000 | 2,051,195 | ||||
Others | 18,008,882 | 23,519,244 | ||||
Total | 210,618,310 | 559,185,652 |
PROPERTY_EQUIPMENT_AND_SOFTWAR1
PROPERTY, EQUIPMENT AND SOFTWARE (Tables) | 12 Months Ended | |||||
Dec. 31, 2013 | ||||||
PROPERTY, EQUIPMENT AND SOFTWARE | ' | |||||
Schedule of property, equipment and software and its related accumulated depreciation and amortization | ' | |||||
2012 | 2013 | |||||
RMB | RMB | |||||
Buildings | 892,430,743 | 1,050,102,815 | ||||
Computer equipment | 232,200,943 | 256,542,169 | ||||
Website-related equipment | 107,209,531 | 135,116,574 | ||||
Furniture and fixtures | 58,079,451 | 60,468,480 | ||||
Software | 43,782,203 | 52,640,160 | ||||
Leasehold improvements | 28,866,215 | 44,835,912 | ||||
Construction in progress | 81,050,521 | 199,363,516 | ||||
Less: accumulated depreciation and amortization | (319,682,416 | ) | (386,125,933 | ) | ||
Total net book value | 1,123,937,191 | 1,412,943,693 |
INVESTMENTS_Tables
INVESTMENTS (Tables) | 12 Months Ended | |||||
Dec. 31, 2013 | ||||||
INVESTMENTS | ' | |||||
Schedule of long-term investments consisting of cost method investments, equity method investments and available-for-sale securities | ' | |||||
2012 | 2013 | |||||
RMB | RMB | |||||
Hanting (available-for-sale) | 585,540,705 | 1,016,455,767 | ||||
eHi (available-for-sale) | — | 570,977,550 | ||||
Easy Go (available-for-sale) | — | 143,904,165 | ||||
Dining Secretary (available-for-sale) | 60,234,118 | 56,242,365 | ||||
Happy City (available-for-sale) | — | 37,358,327 | ||||
Home Inns (equity method) | 762,423,802 | 801,550,868 | ||||
Yishang Network (equity method) | — | 21,665,182 | ||||
Starway Hong Kong (equity method) | 15,656,192 | — | ||||
Keystone (cost method) | — | 155,330,749 | ||||
Zhong’an Online (cost method) | — | 50,000,000 | ||||
Others | 13,393,132 | 3,728,507 | ||||
Total net book value | 1,437,247,949 | 2,857,213,480 | ||||
Carrying amount and unrealized securities holding profit for equity method investment | ' | |||||
2012 | 2013 | |||||
RMB | RMB | |||||
Investment cost | ||||||
Balance at beginning of year | 576,296,429 | 570,709,828 | ||||
Foreign currency translation | (5,586,601 | ) | (16,083,543 | ) | ||
Total investment cost | 570,709,828 | 554,626,285 | ||||
Value booked under equity method | ||||||
Share of cumulative profit | 206,428,719 | 265,745,783 | ||||
Amortization of identifiable intangible assets, net of tax | (14,714,745 | ) | (18,821,200 | ) | ||
Total booked value under equity method | 191,713,974 | 246,924,583 | ||||
Net book value | 762,423,802 | 801,550,868 | ||||
Financial information of investees | ' | |||||
2012 | 2013 | |||||
RMB (‘000) | RMB (‘000) | |||||
Current assets | 1,480,017 | 1,621,982 | ||||
Non-current assets | 7,525,212 | 7,755,635 | ||||
Current liabilities | 1,927,080 | 1,776,838 | ||||
Non-current liabilities | 3,160,390 | 3,292,033 | ||||
Retain earnings | 1,018,922 | 1,175,874 | ||||
Non-controlling interest | 10,975 | 19,429 | ||||
Total revenues | 5,613,953 | 6,208,970 | ||||
Net Revenues | 5,269,377 | 5,825,490 | ||||
Income from operations | 270,689 | 455,294 | ||||
Net income | 4,338 | 191,009 | ||||
Net (loss) / income attributable to Home Inns Group’s shareholders | (395 | ) | 189,650 |
FAIR_VALUE_MEASUREMENT_Tables
FAIR VALUE MEASUREMENT (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Fair value measurement | ' | |||||||||||
Fair value, assets measured on recurring basis | ' | |||||||||||
Fair Value Measurement at | ||||||||||||
December 31, 2013 Using | ||||||||||||
Quoted Prices | Significant Other | Unobservable | Fair Value at December 31, 2013 | |||||||||
in Active | Observable | inputs | ||||||||||
Market for | Inputs | (Level 3) | ||||||||||
Identical Assets | (Level 2) | |||||||||||
(Level 1) | ||||||||||||
RMB | RMB | RMB | RMB | US$ | ||||||||
Short-term investments | ||||||||||||
Financial products | — | 3,375,477,351 | — | 3,375,477,351 | 557,589,136 | |||||||
Time deposits | — | 259,613,604 | — | 259,613,604 | 42,885,112 | |||||||
Available-for-sale investments | ||||||||||||
Hanting | 1,016,455,767 | — | — | 1,016,455,767 | 167,906,530 | |||||||
eHi | — | — | 570,977,550 | 570,977,550 | 94,318,772 | |||||||
Easy Go | — | — | 143,904,165 | 143,904,165 | 23,771,275 | |||||||
Dining Secretary | — | — | 56,242,365 | 56,242,365 | 9,290,577 | |||||||
Happy City | — | — | 37,358,327 | 37,358,327 | 6,171,156 | |||||||
Total | 1,016,455,767 | 3,635,090,955 | 808,482,407 | 5,460,029,129 | 901,932,558 | |||||||
Fair Value Measurement at | ||||||||||||
December 31, 2012 Using | ||||||||||||
Quoted Prices | Significant Other | Unobservable | Fair Value at December 31, 2012 | |||||||||
in Active | Observable | inputs | ||||||||||
Market for | Inputs | (Level 3) | ||||||||||
Identical Assets | (Level 2) | |||||||||||
(Level 1) | ||||||||||||
RMB | RMB | RMB | RMB | US$ | ||||||||
Short-term investments | ||||||||||||
Financial products | — | 1,030,000,000 | — | 1,030,000,000 | 165,326,399 | |||||||
Time deposits | — | 378,664,335 | — | 378,664,335 | 60,779,817 | |||||||
Available-for-sale investments | ||||||||||||
Hanting | 585,540,705 | — | — | 585,540,705 | 93,985,763 | |||||||
Dining Secretary | — | — | 60,234,118 | 60,234,118 | 9,668,243 | |||||||
Total | 585,540,705 | 1,408,664,335 | 60,234,118 | 2,054,439,158 | 329,760,222 | |||||||
eHi | ' | |||||||||||
Fair value measurement | ' | |||||||||||
Reconciliation of fair value measurements | ' | |||||||||||
Amount | ||||||||||||
RMB | ||||||||||||
Fair value of available-for-sale(Level 3) investment as at December 31, 2012 | — | |||||||||||
Investment in Series E Preferred Shares of eHi | 570,977,550 | |||||||||||
Transfer in and/or out of Level 3 | — | |||||||||||
The change in fair value of the investment in eHi | — | |||||||||||
Fair value of available-for-sale (Level 3) investment as at December 31, 2013 | 570,977,550 | |||||||||||
Fair value of available-for-sale investment (Level 3) as at December 31, 2013 (US$) | 94,318,772 | |||||||||||
Easy Go | ' | |||||||||||
Fair value measurement | ' | |||||||||||
Reconciliation of fair value measurements | ' | |||||||||||
Amount | ||||||||||||
RMB | ||||||||||||
Fair value of available-for-sale(Level 3) investment as at December 31, 2012 | — | |||||||||||
Investment in Series B Preferred Shares of Easy Go | 139,633,000 | |||||||||||
Transfer in and/or out of Level 3 | — | |||||||||||
The change in fair value of the investment in Easy Go | 4,271,165 | |||||||||||
Fair value of available-for-sale (Level 3) investment as at December 31, 2013 | 143,904,165 | |||||||||||
Fair value of available-for-sale investment (Level 3) as at December 31, 2013 (US$) | 23,771,275 | |||||||||||
Significant unobservable inputs used in the valuation | ' | |||||||||||
Valuation Technique | Unobservable Input | Parameter value | ||||||||||
Discounted cash flow | Weighted average cost of capital (“WACC”) | 28% | ||||||||||
Terminal growth rate | 3% | |||||||||||
Lack of marketability discount (“LoMD”) | 17.50% | |||||||||||
Option pricing model | Time to liquidation | 1.57 years | ||||||||||
Risk-free rate | 0.96% | |||||||||||
Expected volatility | 36.72% | |||||||||||
Probability | Liquidation scenario: 55% | |||||||||||
Redemption scenario: 40% | ||||||||||||
Mandatory Conversion scenario: 5% | ||||||||||||
Dividend yield | Nil | |||||||||||
Dining Secretary | ' | |||||||||||
Fair value measurement | ' | |||||||||||
Reconciliation of fair value measurements | ' | |||||||||||
Amount | ||||||||||||
RMB | ||||||||||||
Fair value of available-for-sale(Level 3) investment as at December 31, 2011 | 65,414,773 | |||||||||||
Investment in Series B Preferred Shares of Dining Secretary | — | |||||||||||
Transfer in and/or out of Level 3 | — | |||||||||||
Effect of exchange rate change | (638,000 | ) | ||||||||||
The change in fair value of the investment in Ding Secretary | (4,542,655 | ) | ||||||||||
Fair value of available-for-sale (Level 3) investment as at December 31, 2012 | 60,234,118 | |||||||||||
Investment in Series B Preferred Shares of Dining Secretary | — | |||||||||||
Transfer in and/or out of Level 3 | — | |||||||||||
Effect of exchange rate change | (1,764,000 | ) | ||||||||||
The change in fair value of the investment in Ding Secretary | (2,227,753 | ) | ||||||||||
Fair value of available-for-sale (Level 3) investment as at December 31, 2013 | 56,242,365 | |||||||||||
Fair value of available-for-sale investment (Level 3) as at December 31, 2013 (US$) | 9,290,577 | |||||||||||
Significant unobservable inputs used in the valuation | ' | |||||||||||
Valuation Technique | Unobservable Input | Parameter value | ||||||||||
Discounted cash flow | Weighted average cost of capital (“WACC”) | 28% | ||||||||||
Terminal growth rate | 3% | |||||||||||
Lack of marketability discount (“LoMD”) | 25% | |||||||||||
Option pricing model | Time to liquidation | 2.0 years | ||||||||||
Risk-free rate | 1.08% | |||||||||||
Expected volatility | 44.90% | |||||||||||
Probability | Liquidation scenario: 45% | |||||||||||
Redemption scenario: 45% | ||||||||||||
IPO scenario: 10% | ||||||||||||
Dividend yield | Nil | |||||||||||
Happy City | ' | |||||||||||
Fair value measurement | ' | |||||||||||
Reconciliation of fair value measurements | ' | |||||||||||
Amount | ||||||||||||
RMB | ||||||||||||
Fair value of available-for-sale(Level 3) investment as at December 31, 2012 | — | |||||||||||
Investment in Series A Preferred Shares of Happy City | 36,715,800 | |||||||||||
Transfer in and/or out of Level 3 | — | |||||||||||
The change in fair value of the investment in Happy City | 642,527 | |||||||||||
Fair value of available-for-sale (Level 3) investment as at December 31, 2013 | 37,358,327 | |||||||||||
Fair value of available-for-sale investment (Level 3) as at December 31, 2013 (US$) | 6,171,156 | |||||||||||
Significant unobservable inputs used in the valuation | ' | |||||||||||
Valuation Technique | Unobservable Input | Parameter value | ||||||||||
Discounted cash flow | Weighted average cost of capital (“WACC”) | 27.50% | ||||||||||
Terminal growth rate | 3% | |||||||||||
Lack of marketability discount (“LoMD”) | 35% | |||||||||||
Option pricing model | Time to liquidation | 4.0 years | ||||||||||
Risk-free rate | 1.46% | |||||||||||
Expected volatility | 51.20% | |||||||||||
Probability | Liquidation scenario: 50% | |||||||||||
Redemption scenario: 50% | ||||||||||||
Dividend yield | Nil |
GOODWILL_Tables
GOODWILL (Tables) | 12 Months Ended | |||||
Dec. 31, 2013 | ||||||
GOODWILL | ' | |||||
Changes in the carrying amount of goodwill | ' | |||||
2012 | 2013 | |||||
RMB | RMB | |||||
Balance at beginning of year | 798,601,767 | 822,585,341 | ||||
Acquisition of a B2B hotel reservation company | — | 72,406,431 | ||||
Acquisition of a wholesaler operated hotel reservation and air ticketing services | — | 43,993,740 | ||||
Acquisition (Disposal) of others | 23,983,574 | 33,545,672 | ||||
Balance at end of period | 822,585,341 | 972,531,184 |
INTANGIBLE_ASSETS_Tables
INTANGIBLE ASSETS (Tables) | 12 Months Ended | |||||
Dec. 31, 2013 | ||||||
INTANGIBLE ASSETS | ' | |||||
Intangible assets (exclude land use rights) | ' | |||||
2012 | 2013 | |||||
RMB | RMB | |||||
Intangible assets | ||||||
Intangible assets to be amortized | ||||||
Non-compete agreements | 11,479,610 | 11,479,610 | ||||
Customer list | 15,942,578 | 15,942,578 | ||||
Supplier Relationship | 9,700,000 | 27,780,000 | ||||
Technology patent | 9,240,000 | 9,240,000 | ||||
Cross-border travel agency license | 1,117,277 | 1,117,277 | ||||
Others | — | 790,000 | ||||
Intangible assets not subject to amortization | ||||||
Trade mark | 290,715,235 | 314,329,235 | ||||
Golf membership certificate | 4,200,000 | 4,200,000 | ||||
Others | 8,736,321 | 8,785,287 | ||||
351,131,021 | 393,663,987 | |||||
Less: accumulated amortization | ||||||
Intangible assets to be amortized | ||||||
Non-compete agreements | (9,183,688 | ) | (11,479,610 | ) | ||
Customer list | (10,499,636 | ) | (11,982,578 | ) | ||
Supplier Relationship | (1,455,000 | ) | (3,178,333 | ) | ||
Technology patent | (7,392,000 | ) | (9,240,000 | ) | ||
Cross-border travel agency license | (1,117,277 | ) | (1,117,277 | ) | ||
Others | — | (13,167 | ) | |||
Intangible assets not subject to amortization | ||||||
Trade mark | — | — | ||||
Golf membership certificate | — | — | ||||
Others | — | — | ||||
(29,647,601 | ) | (37,010,965 | ) | |||
Net book value | ||||||
Intangible assets to be amortized | ||||||
Non-compete agreements | 2,295,922 | — | ||||
Customer list | 5,442,942 | 3,960,000 | ||||
Supplier Relationship | 8,245,000 | 24,601,667 | ||||
Technology patent | 1,848,000 | — | ||||
Cross-border travel agency license | — | — | ||||
Others | — | 776,833 | ||||
Intangible assets not subject to amortization | ||||||
Trade mark | 290,715,235 | 314,329,235 | ||||
Golf membership certificate | 4,200,000 | 4,200,000 | ||||
Others | 8,736,321 | 8,785,287 | ||||
321,483,420 | 356,653,022 | |||||
Schedule of finite-lived intangible assets, future amortization expense | ' | |||||
Amortization | ||||||
RMB | ||||||
2014 | 3,416,000 | |||||
2015 | 3,416,000 | |||||
2016 | 3,416,000 | |||||
2017 | 3,416,000 | |||||
2018 | 3,402,833 | |||||
17,066,833 |
RELATED_PARTY_TRANSACTIONS_Tab
RELATED PARTY TRANSACTIONS (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
RELATED PARTY TRANSACTIONS | ' | |||||||
Schedule of related party transactions | ' | |||||||
2011 | 2012 | 2013 | ||||||
RMB | RMB | RMB | ||||||
Commissions from Home Inns | 17,660,504 | 35,932,452 | 38,709,984 | |||||
Commissions from Hanting | 7,965,109 | 10,988,806 | 17,127,847 | |||||
Consideration for disposal majority equity share of Starway Hong Kong from Hanting | — | 17,131,759 | 16,459,926 | |||||
Entrusted loan and interest to Yishang | — | — | 13,374,109 | |||||
Commissions from Starway Hong Kong | — | 7,118,150 | 6,146,474 | |||||
Commissions from 7 Days Group Holdings Limited (“7 Days”) | — | — | 1,214,368 | |||||
Purchase of tour package from Ananda Travel Service (Aust.) Pty Limited (“Ananda”) | 29,386,855 | 32,989,774 | 32,738,333 | |||||
Printing expenses to Joyu Tourism Operating Group (“Joyu”) | 2,160,000 | 2,160,000 | — | |||||
Significant balances with related parties | ' | |||||||
2012 | 2013 | |||||||
RMB | RMB | |||||||
Due from related parties, current: | ||||||||
Due from Yishang | — | 13,152,649 | ||||||
Due from Hanting | 627,145 | 5,592,854 | ||||||
Due from Home Inns | 3,797,931 | 3,029,166 | ||||||
Due from Starway Hong Kong | 903,094 | — | ||||||
5,328,170 | 21,774,669 | |||||||
Due from related parties, non-current: | ||||||||
Due from Hanting | — | 8,166,667 | ||||||
Due to related parties, current: | ||||||||
Due to Ananda | 9,215,726 | 10,216,780 | ||||||
Due to Hanting | 1,000,000 | 1,000,000 | ||||||
Due to Joyu | 180,000 | — | ||||||
10,395,726 | 11,216,780 |
TAXATION_Tables
TAXATION (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
TAXATION | ' | |||||||
Composition of income tax expense | ' | |||||||
2011 | 2012 | 2013 | ||||||
RMB | RMB | RMB | ||||||
Current income tax expense | 265,574,760 | 317,283,820 | 329,612,294 | |||||
Deferred tax benefit | (3,388,535 | ) | (22,757,864 | ) | (35,871,972 | ) | ||
Income tax expense | 262,186,225 | 294,525,956 | 293,740,322 | |||||
Reconciliation of the differences between statutory tax rate and the effective tax rate | ' | |||||||
2011 | 2012 | 2013 | ||||||
Statutory CIT rate | 25 | % | 25 | % | 25 | % | ||
Tax differential from statutory rate applicable to Subsidiaries in the PRC | (10 | )% | (17 | )% | (15 | )% | ||
Non-deductible expenses incurred | 6 | % | 13 | % | 16 | % | ||
Withholding tax | — | 10 | % | — | ||||
Others | (1 | )% | 0 | % | 0 | % | ||
Effective CIT rate | 20 | % | 31 | % | 26 | % | ||
Significant components of deferred tax assets and liabilities | ' | |||||||
2012 | 2013 | |||||||
RMB | RMB | |||||||
Deferred tax assets: | ||||||||
Loss carry forward | 42,205,411 | 86,735,795 | ||||||
Accrued liability for customer reward related programs | 32,209,006 | 60,078,932 | ||||||
Accrued staff salary | 22,215,827 | 34,842,016 | ||||||
Deferred tax liabilities | (390,000 | ) | (390,000 | ) | ||||
Others | 3,452,556 | 2,448,552 | ||||||
Less: Valuation allowance of deferred tax assets | (37,852,274 | ) | (86,735,795 | ) | ||||
Total deferred tax assets | 61,840,526 | 96,979,500 | ||||||
Deferred tax liabilities, non-current: | ||||||||
Recognition of intangible assets | (53,309,153 | ) | (63,197,155 | ) | ||||
Net deferred tax assets | 8,531,373 | 33,782,345 | ||||||
Schedule of movement of valuation allowances | ' | |||||||
2011 | 2012 | 2013 | ||||||
RMB | RMB | RMB | ||||||
Balance at beginning of year | 12,733,226 | 14,785,786 | 37,852,274 | |||||
Current year additions | 2,879,759 | 27,991,746 | 48,883,521 | |||||
Current year disposal due to divestitures | (827,199 | ) | (4,925,258 | ) | — | |||
Balance at end of year | 14,785,786 | 37,852,274 | 86,735,795 | |||||
Effect of preferential tax on China operations | ' | |||||||
2011 | 2012 | 2013 | ||||||
RMB | RMB | RMB | ||||||
Tax holiday effect | 115,750,217 | 119,971,884 | 146,321,156 | |||||
Basic net income per ADS effect | 0.8 | 0.88 | 1.11 | |||||
Diluted net income per ADS effect | 0.76 | 0.83 | 0.96 |
OTHER_PAYABLES_AND_ACCRUALS_Ta
OTHER PAYABLES AND ACCRUALS (Tables) | 12 Months Ended | |||||
Dec. 31, 2013 | ||||||
OTHER PAYABLES AND ACCRUALS | ' | |||||
Other Payables and Accruals | ' | |||||
2012 | 2013 | |||||
RMB | RMB | |||||
Accrued operating expenses | 204,438,348 | 330,863,616 | ||||
Electronic coupon | 41,475,136 | 133,306,380 | ||||
Accruals for property and equipment | 34,450,253 | 37,038,698 | ||||
Deposits received from suppliers and packaged-tour customers | 10,161,612 | 33,769,690 | ||||
Due to employees for stock option proceeds received on their behalf | 13,242,768 | 28,413,780 | ||||
Payable for acquisition | 19,742,776 | 23,773,221 | ||||
Interest payable | 1,492,269 | 13,838,961 | ||||
Others | 18,754,719 | 34,100,603 | ||||
Total | 343,757,881 | 635,104,949 |
LONGTERM_DEBT_Tables
LONG-TERM DEBT (Tables) | 12 Months Ended | |||||
Dec. 31, 2013 | ||||||
LONG-TERM DEBT. | ' | |||||
Schedule of convertible senior notes | ' | |||||
2012 | 2013 | |||||
RMB | RMB | |||||
2017 Convertible Senior Notes | 1,121,418,000 | 814,222,650 | ||||
2018 Convertible Senior Notes | — | 4,842,960,000 | ||||
Total | 1,121,418,000 | 5,657,182,650 |
NONCONTROLLING_INTERESTS_Table
NON-CONTROLLING INTERESTS (Tables) | 12 Months Ended | |||||
Dec. 31, 2013 | ||||||
NON-CONTROLLING INTERESTS | ' | |||||
Schedule of noncontrolling interest | ' | |||||
December 31, 2012 | December 31, 2013 | |||||
RMB | RMB | |||||
Tujia* | 40,250,981 | 83,133,600 | ||||
ezTravel | 21,269,409 | 21,475,705 | ||||
Others | 33,727,148 | 95,081,123 | ||||
95,247,538 | 199,690,428 | |||||
* In October 2012 and February 2013, a subsidiary of the Company, Tujia, entered into a series of agreements with C-Travel, a wholly owned subsidiary of the Company, and other institutional investors to issue 70,380,000 Series A redeemable convertible preferred shares (“Series A preferred shares”) with total consideration of US$14.6 million and 33,333,333 Series B redeemable convertible preferred shares (“Series B preferred shares”) with total consideration of US$36.7 million. All of the Series A Preferred Shares and the Series B Preferred Shares issued by Tujia are collectively referred to as the “Preferred Shares”. The Company assessed it has the right to consolidate Tujia after the issuance of Series A and B redeemable convertible preferred shares. The shares held by investors other than Ctrip are recorded as non-controlling interests. |
EARNINGS_PER_SHARE_Tables
EARNINGS PER SHARE (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
EARNINGS PER SHARE | ' | |||||||
Basic earnings per share and diluted earnings per share | ' | |||||||
2011 | 2012 | 2013 | ||||||
RMB | RMB | RMB | ||||||
Numerator: | ||||||||
Net income attributable to Ctrip’s shareholders | 1,076,414,897 | 714,405,864 | 998,319,684 | |||||
Eliminate the dilutive effect of interest expense of convertible bond | — | 4,617,398 | 15,496,021 | |||||
Numerator for diluted earnings per share | 1,076,414,897 | 719,023,262 | 1,013,815,705 | |||||
Denominator: | ||||||||
Denominator for basic earnings per ordinary share - weighted average ordinary shares outstanding | 35,977,063 | 34,236,761 | 32,905,601 | |||||
Dilutive effect of share options | 2,053,911 | 1,230,941 | 2,359,614 | |||||
Dilutive effect of convertible bond | — | 623,083 | 2,206,157 | |||||
Dilutive effect of convertible bond sold warrants | — | — | 598,469 | |||||
Denominator for diluted earnings per ordinary share | 38,030,974 | 36,090,785 | 38,069,841 | |||||
Basic earnings per ordinary share | 29.92 | 20.87 | 30.34 | |||||
Diluted earnings per ordinary share | 28.3 | 19.92 | 26.63 | |||||
Basic earnings per ADS | 7.48 | 5.22 | 7.58 | |||||
Diluted earnings per ADS | 7.08 | 4.98 | 6.66 | |||||
Schedule of weighted average number of ordinary shares excluded from computation of diluted earnings per share | ' | |||||||
2011 | 2012 | 2013 | ||||||
RMB | RMB | RMB | ||||||
Outstanding weighted average stock options | 715,894 | 1,779,507 | 251,266 | |||||
Sold Warrants | — | 299,319 | 870,425 | |||||
715,894 | 2,078,826 | 1,121,691 |
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended | |||
Dec. 31, 2013 | ||||
COMMITMENTS AND CONTINGENCIES | ' | |||
Operating lease commitments | ' | |||
Office Premises | ||||
RMB | ||||
2014 | 49,445,429 | |||
2015 | 35,829,711 | |||
2016 | 15,077,517 | |||
2017 | 5,155,184 | |||
2018 | 2,395,381 | |||
Thereafter | 610,087 | |||
108,513,309 |
PRINCIPAL_ACCOUNTING_POLICIES_2
PRINCIPAL ACCOUNTING POLICIES (Details) (CNY) | 12 Months Ended |
Dec. 31, 2013 | |
officer | |
Shanghai Ctrip Commerce | Two senior officers of the Company | ' |
Major variable interest entities and their subsidiaries | ' |
Number of Officers | 2 |
Shareholding percentage of VIE | 100.00% |
Registered capital of VIE | 30,000,000 |
Shanghai Huacheng | Shanghai Ctrip Commerce | ' |
Major variable interest entities and their subsidiaries | ' |
Shareholding percentage of VIE | 100.00% |
Registered capital of VIE | 69,950,000 |
Beijing Ctrip | Shanghai Ctrip Commerce and One Senior Officer of Ctrip.com International, Ltd. | ' |
Major variable interest entities and their subsidiaries | ' |
Shareholding percentage of VIE | 100.00% |
Registered capital of VIE | 40,000,000 |
Guangzhou Ctrip | Two senior officers of the Company | ' |
Major variable interest entities and their subsidiaries | ' |
Number of Officers | 2 |
Shareholding percentage of VIE | 100.00% |
Registered capital of VIE | 3,000,000 |
Shanghai Ctrip | One senior officer of the Company | ' |
Major variable interest entities and their subsidiaries | ' |
Shareholding percentage of VIE | 100.00% |
Registered capital of VIE | 10,000,000 |
Shenzhen Ctrip | Two senior officers of the Company | ' |
Major variable interest entities and their subsidiaries | ' |
Number of Officers | 2 |
Shareholding percentage of VIE | 100.00% |
Registered capital of VIE | 2,500,000 |
Ctrip Insurance | Shanghai Ctrip Commerce and Ctrip Computer Technology | ' |
Major variable interest entities and their subsidiaries | ' |
Shareholding percentage of VIE | 100.00% |
Registered capital of VIE | 50,000,000 |
Chengdu Ctrip | Shanghai Ctrip | ' |
Major variable interest entities and their subsidiaries | ' |
Shareholding percentage of VIE | 100.00% |
Registered capital of VIE | 11,500,000 |
Chengdu Ctrip International | Shanghai Ctrip | ' |
Major variable interest entities and their subsidiaries | ' |
Shareholding percentage of VIE | 100.00% |
Registered capital of VIE | 2,000,000 |
PRINCIPAL_ACCOUNTING_POLICIES_3
PRINCIPAL ACCOUNTING POLICIES (Details 2) | 12 Months Ended | 12 Months Ended | ||||||||||||||||||||||
Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2010 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
USD ($) | CNY | CNY | CNY | USD ($) | CNY | Amended and restated share pledge agreements | Amended and restated exclusive option agreements | Ctrip Computer Technology, Ctrip Travel Network and Ctrip Travel Information | Ctrip Computer Technology, Ctrip Travel Network and Ctrip Travel Information | Ctrip Computer Technology, Ctrip Travel Network and Ctrip Travel Information | Ctrip Computer Technology, Ctrip Travel Network and Ctrip Travel Information | Ctrip Computer Technology, Ctrip Travel Network and Ctrip Travel Information | Ctrip Computer Technology, Ctrip Travel Network and Ctrip Travel Information | Ctrip Computer Technology, Ctrip Travel Network and Ctrip Travel Information | Ctrip Computer Technology, Ctrip Travel Network and Ctrip Travel Information | Ctrip Computer Technology, Ctrip Travel Network and Ctrip Travel Information | Ctrip Computer Technology, Ctrip Travel Network and Ctrip Travel Information | Ctrip Computer Technology, Ctrip Travel Network and Ctrip Travel Information | Chengdu Ctrip and Chengdu Ctrip International | Chengdu Ctrip and Chengdu Ctrip International | Variable interest entities | Variable interest entities | Variable interest entities | |
Amended and Restated Technical Consulting and Services Agreement | Amended and Restated Technical Consulting and Services Agreement | Amended and Restated Technical Consulting and Services Agreement | Amended and Restated Technical Consulting and Services Agreement | Amended and Restated Technical Consulting and Services Agreement | Amended and Restated Technical Consulting and Services Agreement | Amended and Restated Technical Consulting and Services Agreement | Amended and Restated Technical Consulting and Services Agreement | Amended and Restated Technical Consulting and Services Agreement | Amended and Restated Technical Consulting and Services Agreement | Amended and Restated Technical Consulting and Services Agreement | CNY | CNY | CNY | CNY | CNY | |||||||||
Air tickets | Air tickets | Air tickets | Air tickets | Packaged-tour products | Packaged-tour products | Packaged-tour products | Packaged-tour products | |||||||||||||||||
Minimum | Minimum | Maximum | Maximum | Minimum | Minimum | Maximum | Maximum | |||||||||||||||||
USD ($) | CNY | USD ($) | CNY | USD ($) | CNY | USD ($) | CNY | |||||||||||||||||
Financial information of the group's VIEs | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Average rate per ticket based on number of tickets sold | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $1 | 8 | $14 | 85 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Average rate per person per tour based on number of tour packages sold | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4 | 27 | 21 | 125 | ' | ' | ' | ' | ' |
Service fees charged from affiliates as percentage of their total net income | ' | ' | ' | ' | ' | ' | ' | ' | 105.90% | 82.70% | 77.70% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 105.90% | 82.70% | 77.70% |
Term of technical consulting and services agreements | ' | ' | ' | ' | ' | ' | ' | ' | '10 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Term of automatic renewal of technical consulting and services agreements | ' | ' | ' | ' | ' | ' | ' | ' | '10 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Written notice period required to be served for the termination of agreements | ' | ' | ' | ' | ' | ' | ' | ' | '30 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Period of expiration of share pledge agreements after the pledgor | ' | ' | ' | ' | ' | ' | '2 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Term of exclusive option agreements | ' | ' | ' | ' | ' | ' | ' | '10 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Term of automatic renewal of exclusive option agreements | ' | ' | ' | ' | ' | ' | ' | '10 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Value of an asset of a consolidated VIE that can be used only to settle obligations of the VIE, except for registered capital and PRC statutory reserves | ' | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount of registered capital and PRC statutory reserves of VIEs | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 444,000,000 | ' | ' |
Total assets | 3,438,966,989 | 20,818,474,462 | 11,669,751,008 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,982,258,881 | 3,724,911,506 | ' |
Less: Inter-company receivables | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -373,041,663 | -542,006,382 | ' |
Total assets excluding inter-company | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,609,217,218 | 3,182,905,124 | ' |
Total liabilities | 1,996,859,524 | 12,088,388,503 | 5,084,871,395 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,287,287,035 | 2,835,938,149 | ' |
Less: Inter-company payables | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -1,442,636,737 | -564,890,117 | ' |
Total liabilities excluding inter-company | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,844,650,298 | 2,271,048,032 | ' |
Cash and cash equivalents | 1,179,170,559 | 7,138,344,814 | 3,421,532,962 | 3,503,428,418 | 565,196,980 | 2,153,935,111 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,500,000,000 | 1,400,000,000 | ' |
Short-term investment | 600,474,248 | 3,635,090,955 | 1,408,664,335 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,600,000,000 | 118,000,000 | ' |
Accounts receivables | 250,793,734 | 1,518,230,029 | 983,804,403 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,100,000,000 | 754,000,000 | ' |
Prepayments and other current assets | 200,828,632 | 1,215,756,287 | 993,820,540 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 912,000,000 | 534,000,000 | ' |
Advances from customers | 405,030,221 | 2,451,931,450 | 1,414,865,769 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,100,000,000 | 1,200,000,000 | ' |
Accounts payable | 270,503,299 | 1,637,545,824 | 1,023,672,151 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,300,000,000 | 792,000,000 | ' |
Taxes payable | 52,083,793 | 315,299,656 | 216,456,010 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 46,000,000 | 66,000,000 | ' |
Salary and welfare payable | 42,559,387 | 257,641,763 | 229,969,924 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 119,000,000 | 78,000,000 | ' |
Other payables and accruals | 104,911,864 | 635,104,949 | 343,757,881 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 181,000,000 | 79,000,000 | ' |
Net revenues | 889,826,973 | 5,386,745,542 | 4,158,791,249 | 3,498,084,628 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,137,211,893 | 2,465,286,325 | 1,923,643,591 |
Cost of revenues | 229,077,600 | 1,386,767,067 | 1,037,791,093 | 805,129,784 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 904,328,902 | 644,886,101 | 461,223,883 |
Net income / (loss) | 149,727,042 | 906,402,585 | 690,510,763 | 1,084,960,155 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -74,463,933 | 198,929,052 | 206,213,884 |
Revenues as a percent of total | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 58.00% | ' | ' |
Net income before the deduction of inter-company consulting fee charges | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,300,000,000 | 1,100,000,000 | 956,000,000 |
Service fee | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 286,000,000 | 201,000,000 | ' | ' | ' |
PRINCIPAL_ACCOUNTING_POLICIES_4
PRINCIPAL ACCOUNTING POLICIES (Details 3) | 12 Months Ended |
Dec. 31, 2013 | |
PRINCIPAL ACCOUNTING POLICIES | ' |
RMB/USD exchange rate used in translation | 6.0537 |
Minimum | ' |
Statement | ' |
Lease periods of parcels of land | '3 years |
Maximum | ' |
Statement | ' |
Lease periods of parcels of land | '10 years |
Land use rights | Minimum | ' |
Statement | ' |
Lease periods of parcels of land | '40 years |
Land use rights | Maximum | ' |
Statement | ' |
Lease periods of parcels of land | '50 years |
PRINCIPAL_ACCOUNTING_POLICIES_5
PRINCIPAL ACCOUNTING POLICIES (Details 4) | 12 Months Ended |
Dec. 31, 2013 | |
Building | Minimum | ' |
Property, equipment and software | ' |
Estimated useful life | '20 years |
Building | Maximum | ' |
Property, equipment and software | ' |
Estimated useful life | '30 years |
Website-related equipment | ' |
Property, equipment and software | ' |
Estimated useful life | '5 years |
Computer equipment | Minimum | ' |
Property, equipment and software | ' |
Estimated useful life | '3 years |
Computer equipment | Maximum | ' |
Property, equipment and software | ' |
Estimated useful life | '5 years |
Furniture and fixtures | Minimum | ' |
Property, equipment and software | ' |
Estimated useful life | '3 years |
Furniture and fixtures | Maximum | ' |
Property, equipment and software | ' |
Estimated useful life | '5 years |
Software | Minimum | ' |
Property, equipment and software | ' |
Estimated useful life | '3 years |
Software | Maximum | ' |
Property, equipment and software | ' |
Estimated useful life | '5 years |
PRINCIPAL_ACCOUNTING_POLICIES_6
PRINCIPAL ACCOUNTING POLICIES (Details 5) (CNY) | Oct. 31, 2013 | Dec. 31, 2013 | Nov. 30, 2013 | 31-May-12 | Nov. 30, 2013 | 31-May-12 |
In Millions, unless otherwise specified | Zhong'an Online | Keystone | Yishang Network | Starway Hong Kong | Starway Hong Kong | Starway Hong Kong |
Hanting | Hanting | |||||
Investment transaction disclosures | ' | ' | ' | ' | ' | ' |
Percentage of equity interest purchased aggregate | 5.00% | 4.00% | 35.00% | ' | ' | ' |
Equity sold (as a percent) | ' | ' | ' | ' | 49.00% | 51.00% |
Company's non-controlling interest (as a percent) | ' | ' | ' | 49.00% | ' | ' |
Amount of consideration paid | ' | ' | 13 | ' | ' | ' |
PRINCIPAL_ACCOUNTING_POLICIES_7
PRINCIPAL ACCOUNTING POLICIES (Details 6) | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Feb. 28, 2012 | Feb. 28, 2012 | 31-May-10 | 31-May-10 | Dec. 31, 2013 | Aug. 31, 2013 | Aug. 31, 2013 | Aug. 31, 2013 | Aug. 31, 2013 | Aug. 31, 2013 |
USD ($) | CNY | CNY | CNY | Wing On Travel | Wing On Travel | Wing On Travel | Wing On Travel | Wing On Travel | B2B hotel reservation company | B2B hotel reservation company | Wholesaler operated hotel reservation and air ticketing services | Wholesaler operated hotel reservation and air ticketing services | Wholesaler operated hotel reservation and air ticketing services | |
USD ($) | CNY | USD ($) | CNY | USD ($) | CNY | USD ($) | HKD | CNY | ||||||
Business combination disclosures | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Acquired percentage of issued share capital | ' | ' | ' | ' | 10.00% | 10.00% | 90.00% | 90.00% | ' | 51.00% | 51.00% | 100.00% | 100.00% | ' |
Percentage of Ownership | ' | ' | ' | ' | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' | ' |
Purchase consideration | ' | ' | ' | ' | ' | ' | $88,000,000 | 598,000,000 | ' | $8,000,000 | 46,000,000 | $16,000,000 | 120,000,000 | ' |
Cash payment for acquisition | ' | ' | ' | ' | 9,400,000 | 60,000,000 | 68,000,000 | 454,000,000 | ' | ' | ' | ' | ' | ' |
Amount of difference between the book value of non-controlling interests and the cash consideration, recorded as additional paid in capital | ' | ' | ' | ' | ' | 21,700,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill | $160,650,707 | 972,531,184 | 822,585,341 | 798,601,767 | ' | ' | ' | ' | ' | $12,000,000 | 72,000,000 | $7,000,000 | ' | 44,000,000 |
PRINCIPAL_ACCOUNTING_POLICIES_8
PRINCIPAL ACCOUNTING POLICIES (Details 7) | 12 Months Ended | |||||
Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | |
USD ($) | CNY | CNY | CNY | Minimum | Maximum | |
item | ||||||
PRINCIPAL ACCOUNTING POLICIES | ' | ' | ' | ' | ' | ' |
Number of business acquisitions or investments material to businesses or financial results of the entity | 0 | 0 | ' | ' | ' | ' |
Impairment of goodwill | ' | 0 | 0 | 0 | ' | ' |
Impairment on other intangible assets | ' | 0 | 0 | 0 | ' | ' |
Impairment of long-lived assets | ' | 0 | 0 | 0 | ' | ' |
Intangible assets | ' | ' | ' | ' | ' | ' |
Intangible asset useful life | ' | ' | ' | ' | '3 years | '10 years |
Accrued liability for customer reward program | ' | ' | ' | ' | ' | ' |
Amount of accrued liability for group's customers reward program | 47,023,958 | 284,668,935 | 217,548,153 | ' | ' | ' |
Amount of expenses for group's customers reward program | ' | 203,000,000 | 157,000,000 | 128,000,000 | ' | ' |
Allowance for doubtful accounts activity | ' | ' | ' | ' | ' | ' |
Balance at beginning of year | ' | 4,351,963 | 4,974,138 | 5,718,742 | ' | ' |
Provision for doubtful accounts | 469,577 | 2,842,681 | 376,164 | 185,443 | ' | ' |
Write-offs | ' | -1,297,741 | -998,339 | -930,047 | ' | ' |
Balance at end of period | ' | 5,896,903 | 4,351,963 | 4,974,138 | ' | ' |
Sales and marketing | ' | ' | ' | ' | ' | ' |
Advertising expenses | ' | 537,757,200 | 275,501,438 | 163,324,295 | ' | ' |
PRINCIPAL_ACCOUNTING_POLICIES_9
PRINCIPAL ACCOUNTING POLICIES (Details 8) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Jan. 31, 2012 | Feb. 28, 2010 | Dec. 31, 2009 | Feb. 28, 2009 | Dec. 31, 2008 | Dec. 31, 2007 | Dec. 31, 2010 | Jan. 31, 2012 | Feb. 28, 2009 | Feb. 28, 2009 | Jan. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Nov. 05, 2004 | Dec. 31, 2013 | Oct. 17, 2007 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, except Share data, unless otherwise specified | Stock options | Stock options | Stock options | Stock options | Stock options | Stock options | Stock options | Stock options | Stock options | Stock options | Restricted stock units (RSUs) | Ctrip 2005 Option Plan | Ctrip 2005 Option Plan | Ctrip 2005 Option Plan | Ctrip 2007 Incentive Plan | Ctrip 2007 Incentive Plan | Ctrip 2007 Incentive Plan | Ctrip 2007 Incentive Plan | Ctrip 2007 Incentive Plan | Ctrip 2007 Incentive Plan | ||||
Exercise price over $120.00 | Minimum | Maximum | Stock options | Stock options | Restricted stock units (RSUs) | Restricted stock units (RSUs) | ||||||||||||||||||
Share-based compensation disclosures | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of ordinary shares reserved for future issuances of options | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,000,000 | ' | 1,000,000 | ' | ' | ' | ' |
Number of option outstanding under share incentive plans (in shares) | 4,130,732 | 3,919,535 | 5,433,541 | 4,414,481 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 587,596 | 829,409 | ' | ' | ' | 3,543,136 | 3,090,126 | ' | ' |
Annual increase of number of ordinary shares reserved under share incentive plans | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,000,000 | ' | ' | ' | ' |
Vesting period | ' | ' | ' | ' | ' | ' | ' | ' | '4 years | '3 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '4 years | ' | '4 years | ' |
Restriction period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '4 years | ' |
Restricted stock units outstanding (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 623,424 | 646,301 |
Number of options modified | ' | ' | ' | ' | 1,900,000 | 2,800,000 | ' | 1,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unrecognized compensation cost related to modification of options | ' | ' | ' | ' | ' | $2.70 | $2.60 | $15 | ' | ' | $2.20 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Vesting period of modified options | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '3 years | '4 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of unvested options modified by extension of expiration date | ' | ' | ' | ' | ' | 2,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of vested options modified by extension of expiration date | ' | ' | ' | ' | ' | 500,000 | 600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Lower limit for exercise prices of options modified (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $120 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of restricted stock units considered for replacement under resolution passed by compensation committee | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 518,017 | ' | ' | ' | ' | ' |
Restricted share units conversion ratio | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Recovered_Sheet1
PRINCIPAL ACCOUNTING POLICIES (Details 9) (USD $) | 12 Months Ended | |||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | |
PRINCIPAL ACCOUNTING POLICIES | ' | ' | ' | ' |
Number of shares, outstanding, beginning balance | 3,919,535 | 5,433,541 | 4,414,481 | ' |
Weighted average exercise price, outstanding, beginning balance (in dollars per share) | $64.81 | $85.02 | $67.71 | ' |
Weighted average remaining contractual life (Years), outstanding, beginning balance | '4 years 11 months 26 days | '5 years 1 month 20 days | '5 years 7 months 2 days | '5 years 11 months 23 days |
Aggregate intrinsic value, outstanding, beginning balance | $57,772,345 | $144,827,231 | $415,360,566 | ' |
Number of shares, granted | 945,106 | 961,980 | 1,375,345 | ' |
Weighted average exercise price, granted (in dollars per share) | $79.70 | $79.55 | $136.86 | ' |
Number of shares, exercised | -660,459 | -502,991 | -207,142 | ' |
Weighted average exercise price, exercised (in dollars per share) | $48.05 | $29.39 | $38.12 | ' |
Number of shares, forfeited | -73,450 | -71,623 | -149,143 | ' |
Weighted average exercise price, forfeited (in dollars per share) | $91.75 | $136.67 | $115.98 | ' |
Number of shares, converted to RSU in January 2012 | ' | -1,901,372 | ' | ' |
Weighted average exercise price, converted to RSU in January 2012 (in dollars per share) | ' | $91.80 | ' | ' |
Number of shares, outstanding, ending balance | 4,130,732 | 3,919,535 | 5,433,541 | 4,414,481 |
Weighted average exercise price, outstanding, ending balance (in dollars per share) | $70.42 | $64.81 | $85.02 | $67.71 |
Weighted average remaining contractual life (Years), outstanding, ending balance | '4 years 11 months 26 days | '5 years 1 month 20 days | '5 years 7 months 2 days | '5 years 11 months 23 days |
Aggregate intrinsic value, outstanding, ending balance | 528,988,489 | 57,772,345 | 144,827,231 | 415,360,566 |
Number of shares, vested and expect to vest | 3,982,976 | ' | ' | ' |
Weighted average exercise price, vested and expect to vest (in dollars per share) | $69.95 | ' | ' | ' |
Weighted average remaining contractual life (Years), vested and expect to vest | '4 years 11 months 1 day | ' | ' | ' |
Aggregate intrinsic value, vested and expect to vest | 511,937,931 | ' | ' | ' |
Number of shares, exercisable | 2,283,785 | ' | ' | ' |
Weighted average exercise price, exercisable (in dollars per share) | $60.18 | ' | ' | ' |
Weighted average remaining contractual life (Years), exercisable | '3 years 6 months 29 days | ' | ' | ' |
Aggregate intrinsic value, exercisable | 315,856,509 | ' | ' | ' |
Assumptions | ' | ' | ' | ' |
Pre-vesting forfeiture rate assumptions (as a percent) | 8.00% | ' | ' | ' |
Closing stock price (in dollars per share) | $198.48 | ' | ' | ' |
Total intrinsic value of options exercised | $99,000,000 | $34,000,000 | $25,000,000 | ' |
Recovered_Sheet2
PRINCIPAL ACCOUNTING POLICIES (Details 10) | 12 Months Ended | ||||||||||
Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | |
USD ($) | CNY | USD ($) | USD ($) | 23.00-34.99 | 35.00-44.99 | 45.00-58.99 | 59.00-77.99 | 78.00-96.99 | 97.00-129.99 | 130.00-159.99 | |
USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | |||||
Share-based compensation disclosures by exercise price range | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of shares, outstanding | 4,130,732 | 4,130,732 | ' | ' | 1,125 | 1,353,069 | 157,558 | 1,358,411 | 731,131 | 466,500 | 62,938 |
Weighted-average exercise price, outstanding (in dollars per share) | ' | ' | ' | ' | $30.50 | $38.06 | $58.39 | $76.78 | $91.36 | $106.12 | $151.78 |
Weighted-average remaining contractual life (years), outstanding | ' | ' | ' | ' | '1 month 13 days | '3 years 29 days | '1 year 1 month 13 days | '6 years 11 months 23 days | '5 years 2 months 26 days | '5 years 7 months 10 days | '5 years 2 months 1 day |
Number of shares, exercisable | 2,283,785 | 2,283,785 | ' | ' | 1,125 | 1,353,069 | 157,558 | 98,324 | 374,298 | 257,333 | 42,078 |
Weighted-average exercise price, exercisable (in dollars per share) | ' | ' | ' | ' | $30.50 | $38.06 | $58.39 | $70.69 | $94.61 | $108.79 | $150.76 |
Weighted-average remaining contractual life (years), exercisable | ' | ' | ' | ' | '1 month 13 days | '3 years 29 days | '1 year 1 month 13 days | '6 years 5 months 5 days | '4 years 3 months 11 days | '5 years 4 months 24 days | '5 years 1 month 6 days |
Assumptions | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted average fair value of options granted (in dollars per share) | $38.40 | ' | $38.01 | $64.79 | ' | ' | ' | ' | ' | ' | ' |
Total unrecognized compensation cost | $78,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted average recognized period | '2 years 7 months 6 days | '2 years 7 months 6 days | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total cash received from the exercise of share options | $30,000,000 | 180,261,090 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Recovered_Sheet3
PRINCIPAL ACCOUNTING POLICIES (Details 11) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Share-based compensation disclosures | ' | ' | ' |
Risk-free interest rate, minimum (as a percent) | 0.69% | 0.71% | 0.81% |
Risk-free interest rate, maximum (as a percent) | 0.87% | 1.05% | 2.11% |
Expected life | '5 years | '5 years | '5 years |
Expected dividend yield (as a percent) | 0.00% | 0.00% | 0.00% |
Volatility, minimum (as a percent) | ' | ' | 53.00% |
Volatility, maximum (as a percent) | ' | ' | 55.00% |
Volatility (as a percent) | 56.00% | 56.00% | ' |
Fair value of options at grant date per share | $38.40 | $38.01 | $64.79 |
Minimum | ' | ' | ' |
Share-based compensation disclosures | ' | ' | ' |
Fair value of options at grant date per share | $37.96 | $33.44 | $48.69 |
Maximum | ' | ' | ' |
Share-based compensation disclosures | ' | ' | ' |
Fair value of options at grant date per share | $39.69 | $42.18 | $74.39 |
Recovered_Sheet4
PRINCIPAL ACCOUNTING POLICIES (Details 12) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Share-based compensation arrangement by share-based payment award | ' | ' | ' |
Number of shares, converted to RSU | ' | 1,901,372 | ' |
Outstanding at the beginning of the period (in dollars per share) | ' | ' | ' |
Weighted average exercise price, outstanding, beginning balance (in dollars per share) | $64.81 | $85.02 | $67.71 |
Granted (in dollars per share) | $79.70 | $79.55 | $136.86 |
Exercised (in dollars per share) | $48.05 | $29.39 | $38.12 |
Forfeited (in dollars per share) | $91.75 | $136.67 | $115.98 |
Weighted average exercise price, outstanding, ending balance (in dollars per share) | $70.42 | $64.81 | $85.02 |
Total unrecognized compensation cost | $78,000,000 | ' | ' |
Weighted average recognized period | '2 years 7 months 6 days | ' | ' |
Restricted stock units (RSUs) | ' | ' | ' |
Number of Shares | ' | ' | ' |
Outstanding at the beginning of the period (in shares) | 646,301 | 190,916 | ' |
Granted (in shares) | 259,365 | 164,976 | 188,407 |
Converted from option in January 2012 (in shares) | ' | 475,343 | ' |
Exercised (in shares) | -224,939 | -124,644 | ' |
Forfeited (in shares) | -57,303 | -60,290 | ' |
Outstanding at the end of the period (in shares) | 623,424 | 646,301 | 190,916 |
Outstanding at the beginning of the period (in dollars per share) | ' | ' | ' |
Weighted average exercise price, outstanding, beginning balance (in dollars per share) | $101.30 | $130.29 | ' |
Granted (in dollars per share) | $79.23 | $82.34 | ' |
Exercised (in dollars per share) | $118.54 | $129.84 | ' |
Forfeited (in dollars per share) | $85.40 | $128.27 | ' |
Weighted average exercise price, outstanding, ending balance (in dollars per share) | $83.60 | $101.30 | $130.29 |
Share-based compensation expense | 13,200,000 | 12,500,000 | 22,500,000 |
Total unrecognized compensation cost | $31,000,000 | ' | ' |
Weighted average recognized period | '2 years 3 months 18 days | ' | ' |
Ctrip 2007 Incentive Plan | Restricted stock units (RSUs) | ' | ' | ' |
Share-based compensation arrangement by share-based payment award | ' | ' | ' |
Requisite service period | '4 years | ' | ' |
Recovered_Sheet5
PRINCIPAL ACCOUNTING POLICIES (Details 13) | 12 Months Ended | |||
Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
USD ($) | CNY | CNY | CNY | |
Other income (net) | ' | ' | ' | ' |
Financial subsidies | ' | 119,697,248 | 90,280,139 | 72,791,093 |
Foreign exchange gains/(losses) | ' | 32,523,857 | -9,781,057 | 34,879,388 |
Reimbursement from depository | ' | 17,507,842 | 7,914,706 | 8,080,557 |
Loss from disposal of property, equipment and software | -1,973,412 | -11,946,443 | -653,191 | -3,379,449 |
Gain on disposal of cost method investment | ' | 4,014,829 | ' | ' |
Gain on disposal of equity investment | 97,914 | 592,742 | ' | ' |
Gain on deconsolidation of subsidiaries | ' | ' | 44,432,052 | ' |
Others | ' | 732,299 | -1,904,706 | 5,252,136 |
Total | $26,945,897 | 163,122,374 | 130,287,943 | 117,623,725 |
Recovered_Sheet6
PRINCIPAL ACCOUNTING POLICIES (Details 14) | 12 Months Ended | 12 Months Ended | |||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2012 | Jun. 13, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | |
China | China | China | China | China | Taiwan | Taiwan | |
CNY | CNY | CNY | USD ($) | USD ($) | CNY | CNY | |
Statutory reserves disclosures | ' | ' | ' | ' | ' | ' | ' |
Portion of after-tax profit to be allocated to general reserve under PRC law (as a percent) | 10.00% | ' | ' | ' | ' | 10.00% | ' |
Maximum percentage of statutory general reserve related to entity's registered capital | 50.00% | ' | ' | ' | ' | ' | ' |
Appropriations to statutory reserves | 13,500,462 | 3,371,696 | 3,408,849 | ' | ' | 1,726,256 | 1,801,148 |
Dividends | ' | ' | ' | ' | ' | ' | ' |
Restricted net assets of company's PRC subsidiaries and VIEs not distributable in form of dividends to parent | 1,300,000,000 | ' | ' | ' | ' | ' | ' |
Accumulated profit of subsidiaries in PRC distributable in form of dividends to parent | 4,600,000,000 | 3,600,000,000 | 2,900,000,000 | ' | ' | ' | ' |
Withholding tax rate for dividends distributed by foreign invested enterprise to their immediate holding companies outside mainland china (as a percent) | 10.00% | ' | ' | ' | ' | ' | ' |
Amount approved as payment of dividend to purchase ADSs | ' | ' | ' | ' | 300,000,000 | ' | ' |
PRC withholding tax | ' | 95,000,000 | ' | $15,000,000 | ' | ' | ' |
Recovered_Sheet7
PRINCIPAL ACCOUNTING POLICIES (Details 15) | 0 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | 1 Months Ended | ||||||
Jun. 13, 2012 | Sep. 29, 2011 | Sep. 30, 2008 | Jul. 30, 2008 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Oct. 31, 2013 | Dec. 31, 2013 | Oct. 31, 2013 | |
USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | CNY | CNY | CNY | 2012 Convertible Senior Notes | ADS | ADS | |
item | item | USD ($) | USD ($) | 2012 Convertible Senior Notes | |||||||
item | USD ($) | ||||||||||
Treasury stock disclosures | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Approved repurchase plan | $300,000,000 | $100,000,000 | $15,000,000 | $15,000,000 | ' | ' | ' | ' | ' | ' | ' |
Number of share repurchase plans | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3 | ' |
Number of shares repurchased | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,777,087 | ' |
Cost of repurchased shares | ' | ' | ' | ' | ' | ' | 1,733,127,675 | 158,761,225 | ' | 256,000,000 | ' |
Early conversion of convertible notes | ' | ' | ' | ' | ' | ' | ' | ' | 45,500,000 | ' | 45,500,000 |
Stock issued to bond holders | ' | ' | ' | ' | ' | ' | ' | ' | 588,219 | ' | ' |
Treasury stock, shares | ' | ' | ' | ' | 3,777,087 | 3,777,087 | 4,365,306 | ' | ' | ' | ' |
Treasury stock at cost | ' | ' | ' | ' | $256,230,284 | 1,551,141,268 | 1,891,888,900 | ' | ' | ' | ' |
Segment reporting disclosures | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of reportable segments | ' | ' | ' | ' | 1 | 1 | ' | ' | ' | ' | ' |
PREPAYMENTS_AND_OTHER_CURRENT_2
PREPAYMENTS AND OTHER CURRENT ASSETS (Details) | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 |
USD ($) | CNY | CNY | |
PREPAYMENTS AND OTHER CURRENT ASSETS | ' | ' | ' |
Prepayments and deposits to vendors | ' | 1,083,771,955 | 644,317,439 |
Interest receivable | ' | 55,861,029 | 36,543,547 |
Receivables from financial institution | ' | 28,303,638 | 14,368,206 |
Employee advances | ' | 10,476,537 | 3,676,848 |
Prepayments for property and equipment | ' | 4,575,720 | 7,885,594 |
Receivables related to Capped Call Option | ' | ' | 264,779,132 |
Others | ' | 32,767,408 | 22,249,774 |
Total | $200,828,632 | 1,215,756,287 | 993,820,540 |
LONGTERM_DEPOSITS_AND_PREPAYME2
LONG-TERM DEPOSITS AND PREPAYMENTS (Details) | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 |
USD ($) | CNY | CNY | |
LONG-TERM DEPOSITS AND PREPAYMENTS | ' | ' | ' |
Prepayments for fixed assets | ' | 263,626,283 | 15,499,330 |
Unamortized debt issuance cost | ' | 127,815,384 | 32,396,007 |
Deposits paid to airline suppliers | ' | 127,011,881 | 126,190,327 |
Deposit paid to lessor | ' | 15,161,665 | 18,413,764 |
Deposit paid to travel bureau | ' | 2,051,195 | 110,000 |
Others | ' | 23,519,244 | 18,008,882 |
Total | $92,370,889 | 559,185,652 | 210,618,310 |
LONGTERM_LOAN_RECEIVABLE_Detai
LONG-TERM LOAN RECEIVABLE (Details) | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 |
USD ($) | CNY | Felicity | |
Keystone | |||
USD ($) | |||
Long-term loan receivable | ' | ' | ' |
Amount of loan | $29,499,992 | 178,584,102 | $29,500,000 |
Term of the loan | ' | ' | '5 years |
LAND_USE_RIGHTS_Details
LAND USE RIGHTS (Details) | 12 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | |
CNY | CNY | CNY | USD ($) | Land use rights | Land use rights | Land use rights | Land use rights | Land use rights | Land use rights | |
CNY | CNY | CNY | Shanghai | Nantong | Chengdu | |||||
item | CNY | CNY | CNY | |||||||
sqm | sqm | sqm | ||||||||
Land use rights | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of land use rights | ' | ' | ' | ' | 3 | ' | ' | ' | ' | ' |
Cost | ' | ' | ' | ' | ' | ' | ' | 68,269,734 | 48,912,729 | 9,747,800 |
Square meters | ' | ' | ' | ' | ' | ' | ' | 17,000 | 19,500 | 9,000 |
Use right years | ' | ' | ' | ' | ' | ' | ' | '50 years | '40 years | '50 years |
Amortization expense of land use right | 7,363,364 | 7,736,767 | 8,445,950 | ' | 3,182,490 | 2,801,615 | 2,620,706 | ' | ' | ' |
Net book value | 107,476,794 | 110,659,284 | ' | $17,753,902 | ' | ' | ' | ' | ' | ' |
PROPERTY_EQUIPMENT_AND_SOFTWAR2
PROPERTY, EQUIPMENT AND SOFTWARE (Details) | 12 Months Ended | |||||||||||||||||
Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | |
USD ($) | CNY | CNY | CNY | Buildings | Buildings | Computer equipment | Computer equipment | Website-related equipment | Website-related equipment | Furniture and fixtures | Furniture and fixtures | Software | Software | Leasehold improvements | Leasehold improvements | Construction in progress | Construction in progress | |
CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | |||||
Property, equipment and software | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Original value | ' | ' | ' | ' | 1,050,102,815 | 892,430,743 | 256,542,169 | 232,200,943 | 135,116,574 | 107,209,531 | 60,468,480 | 58,079,451 | 52,640,160 | 43,782,203 | 44,835,912 | 28,866,215 | 199,363,516 | 81,050,521 |
Less: accumulated depreciation and amortization | ' | -386,125,933 | -319,682,416 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total net book value | 233,401,671 | 1,412,943,693 | 1,123,937,191 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Depreciation | $18,252,462 | 110,494,928 | 88,462,807 | 78,809,867 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
INVESTMENTS_Details
INVESTMENTS (Details) | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 |
USD ($) | CNY | CNY | Hanting | Hanting | eHi | Easy Go | Dining Secretary | Dining Secretary | Happy City | Home Inns | Home Inns | Yishang Network | Starway Hong Kong | Keystone | Zhong'an Online | |
CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | ||||
Investment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Available-for-sale | ' | ' | ' | 1,016,455,767 | 585,540,705 | 570,977,550 | 143,904,165 | 56,242,365 | 60,234,118 | 37,358,327 | ' | ' | ' | ' | ' | ' |
Equity method | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 801,550,868 | 762,423,802 | 21,665,182 | 15,656,192 | ' | ' |
Cost method | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 155,330,749 | 50,000,000 |
Others | ' | 3,728,507 | 13,393,132 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total net book value | $471,978,043 | 2,857,213,480 | 1,437,247,949 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
INVESTMENTS_Details_2
INVESTMENTS (Details 2) | Dec. 31, 2013 | Mar. 31, 2010 | Mar. 31, 2010 | Dec. 31, 2013 | Dec. 31, 2013 | Mar. 31, 2010 | Mar. 31, 2010 | Mar. 31, 2010 | Dec. 31, 2013 | Mar. 31, 2010 | Mar. 31, 2010 |
USD ($) | Hanting | Hanting | Hanting | Hanting | Hanting | Hanting | Hanting | Hanting | Hanting | Hanting | |
USD ($) | CNY | CNY | USD ($) | Ordinary shares | Ordinary shares | Ordinary shares | ADS | ADS | ADS | ||
Private placement | Shareholders | IPO | USD ($) | IPO | |||||||
USD ($) | USD ($) | ||||||||||
Investment transaction disclosures | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Purchase of shares, shares purchased | ' | ' | ' | ' | ' | 7,202,482 | 11,646,964 | 3,200,000 | ' | ' | 800,000 |
Purchase of shares, price per share | ' | ' | ' | ' | ' | ' | ' | $3.06 | ' | ' | $12.25 |
Purchase of shares, cost of share aggregate | ' | $67,500,000 | 461,000,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Purchase of shares, number aggregate | ' | 22,049,446 | 22,049,446 | ' | ' | ' | ' | ' | ' | 3,200,000 | ' |
Percentage of equity interest purchased aggregate | ' | 9.00% | 9.00% | ' | ' | ' | ' | ' | ' | ' | ' |
Closing price of ADS (in dollars per share) | $198.48 | ' | ' | ' | ' | ' | ' | ' | $30.46 | ' | ' |
Fair value of available-for-sale investment | ' | ' | ' | 1,000,000,000 | 168,000,000 | ' | ' | ' | ' | ' | ' |
Increase in fair value of the investment credited to other comprehensive income | ' | ' | ' | 608,000,000 | ' | ' | ' | ' | ' | ' | ' |
INVESTMENTS_Details_3
INVESTMENTS (Details 3) | 1 Months Ended | 12 Months Ended | 1 Months Ended | |||
Dec. 31, 2013 | Oct. 31, 2013 | Nov. 30, 2010 | Dec. 31, 2013 | Dec. 31, 2013 | Jun. 30, 2013 | |
eHi | Easy Go | Dining Secretary | Dining Secretary | Dining Secretary | Happy City | |
USD ($) | USD ($) | USD ($) | USD ($) | CNY | USD ($) | |
Investment | ' | ' | ' | ' | ' | ' |
Percentage of equity interest acquired | 19.60% | 20.00% | ' | ' | ' | 33.00% |
Total consideration of acquisition | $94,050,000 | $23,000,000 | $10,000,000 | ' | ' | $6,000,000 |
Decrease in fair value of the investment recorded in other comprehensive income | ' | ' | ' | $700,000 | 4,300,000 | ' |
INVESTMENTS_Details_4
INVESTMENTS (Details 4) (Home Inns, CNY) | 12 Months Ended | |||
In Millions, except Share data, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2013 | Sep. 30, 2011 | Oct. 02, 2011 |
Business Acquired by Home Inns | ||||
Equity method investment disclosures | ' | ' | ' | ' |
Equity method investment, ownership interest (as a percent) | ' | 15.39% | 17.47% | ' |
Number of shares held | ' | 14,400,765 | ' | ' |
Percentage of equity interest Home Inns acquired in a business | ' | ' | ' | 100.00% |
Noncash gain due to remeasurement of equity interest based on issuance of shares | 39.3 | ' | ' | ' |
INVESTMENTS_Details_5
INVESTMENTS (Details 5) | 12 Months Ended | |||||
Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | |
USD ($) | CNY | CNY | CNY | Home Inns | Home Inns | |
CNY | CNY | |||||
Investment cost | ' | ' | ' | ' | ' | ' |
Balance at beginning of year | ' | ' | ' | ' | 570,709,828 | 576,296,429 |
Foreign currency translation | ' | ' | ' | ' | -16,083,543 | -5,586,601 |
Total investment cost | ' | ' | ' | ' | 554,626,285 | 570,709,828 |
Value booked under equity method | ' | ' | ' | ' | ' | ' |
Share of cumulative profit | 9,176,879 | 55,554,072 | 34,343,000 | 57,525,830 | 265,745,783 | 206,428,719 |
Amortization of identifiable intangible assets, net of tax | ' | -7,363,364 | -7,736,767 | -8,445,950 | -18,821,200 | -14,714,745 |
Total booked value under equity method | ' | ' | ' | ' | 246,924,583 | 191,713,974 |
Net book value | ' | ' | ' | ' | 801,550,868 | 762,423,802 |
INVESTMENTS_Details_6
INVESTMENTS (Details 6) | Dec. 31, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2013 | Dec. 31, 2013 |
USD ($) | Home Inns | Home Inns | Home Inns | Home Inns | |
CNY | CNY | ADS | ADS | ||
USD ($) | CNY | ||||
Equity method investment disclosures | ' | ' | ' | ' | ' |
Current assets | ' | 1,621,982,000 | 1,480,017,000 | ' | ' |
Non-current assets | ' | 7,755,635,000 | 7,525,212,000 | ' | ' |
Current liabilities | ' | 1,776,838,000 | 1,927,080,000 | ' | ' |
Non-current liabilities | ' | 3,292,033,000 | 3,160,390,000 | ' | ' |
Retain earnings | ' | 1,175,874,000 | 1,018,922,000 | ' | ' |
Non-controlling interest | ' | 19,429,000 | 10,975,000 | ' | ' |
Total revenues | ' | 6,208,970,000 | 5,613,953,000 | ' | ' |
Net Revenues | ' | 5,825,490,000 | 5,269,377,000 | ' | ' |
Income from operations | ' | 455,294,000 | 270,689,000 | ' | ' |
Net income | ' | 191,009,000 | 4,338,000 | ' | ' |
Net (loss) / income attributable to Home Inns Group's shareholders | ' | 189,650,000 | -395,000 | ' | ' |
Closing price of ADS (in dollars per share) | $198.48 | ' | ' | $43.64 | ' |
Aggregate market value | ' | ' | ' | $314,000,000 | 1,900,000,000 |
INVESTMENTS_Details_7
INVESTMENTS (Details 7) | 12 Months Ended | 1 Months Ended | 0 Months Ended | 1 Months Ended | |||||||
Dec. 31, 2013 | 31-May-12 | Nov. 30, 2013 | 31-May-12 | Jun. 30, 2013 | Jun. 30, 2013 | Jun. 30, 2013 | Dec. 03, 2013 | Dec. 03, 2013 | Oct. 31, 2013 | 31-May-13 | |
CNY | Starway Hong Kong | Starway Hong Kong | Starway Hong Kong | Yishang Network | Yishang Network | Yishang Network | Keystone | Keystone | Zhong'an Online | BTG-Jianguo | |
Hanting | Hanting | CNY | Minimum | Maximum | USD ($) | CNY | CNY | CNY | |||
USD ($) | USD ($) | ||||||||||
Investment transaction disclosures | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of equity interest acquired | ' | ' | ' | ' | 35.00% | ' | ' | 4.00% | 4.00% | 5.00% | ' |
Total consideration of acquisition | ' | ' | ' | ' | 13,000,000 | ' | ' | $25,500,000 | 155,000,000 | 50,000,000 | ' |
Total revenue and net income performance period up to which contingent consideration is tied up | ' | ' | ' | ' | '1 year | ' | ' | ' | ' | ' | ' |
Total enterprise value | ' | ' | ' | ' | ' | 5,000,000 | 17,000,000 | ' | ' | ' | ' |
Contingent consideration as a liability | ' | ' | ' | ' | 9,000,000 | ' | ' | ' | ' | ' | ' |
Company's non-controlling interest (as a percent) | ' | 49.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Transferred equity percentage | ' | ' | 49.00% | 51.00% | ' | ' | ' | ' | ' | ' | ' |
Gain on disposal of cost method investment | 4,014,829 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4,000,000 |
Impairments recorded for investments | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
FAIR_VALUE_MEASUREMENT_Details
FAIR VALUE MEASUREMENT (Details) | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 |
USD ($) | CNY | CNY | Hanting | Hanting | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | Measured on recurring basis | |
USD ($) | CNY | USD ($) | CNY | USD ($) | CNY | Hanting | Hanting | Hanting | Hanting | eHi | eHi | Easy Go | Easy Go | Dining Secretary | Dining Secretary | Dining Secretary | Dining Secretary | Happy City | Happy City | Financial products | Financial products | Financial products | Financial products | Time deposits | Time deposits | Time deposits | Time deposits | Quoted prices in active market for identical assets (Level 1) | Quoted prices in active market for identical assets (Level 1) | Quoted prices in active market for identical assets (Level 1) | Quoted prices in active market for identical assets (Level 1) | Significant other observable inputs (Level 2) | Significant other observable inputs (Level 2) | Significant other observable inputs (Level 2) | Significant other observable inputs (Level 2) | Significant other observable inputs (Level 2) | Significant other observable inputs (Level 2) | Unobservable inputs (Level 3) | Unobservable inputs (Level 3) | Unobservable inputs (Level 3) | Unobservable inputs (Level 3) | Unobservable inputs (Level 3) | Unobservable inputs (Level 3) | Unobservable inputs (Level 3) | ||||
USD ($) | CNY | USD ($) | CNY | USD ($) | CNY | USD ($) | CNY | USD ($) | CNY | USD ($) | CNY | USD ($) | CNY | USD ($) | CNY | USD ($) | CNY | USD ($) | CNY | USD ($) | CNY | CNY | CNY | Hanting | Hanting | CNY | CNY | Financial products | Financial products | Time deposits | Time deposits | CNY | CNY | eHi | Easy Go | Dining Secretary | Dining Secretary | Happy City | ||||||||||
CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | ||||||||||||||||||||||||||||||||||||||
Fair value measurement | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Short-term investment | $600,474,248 | 3,635,090,955 | 1,408,664,335 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $557,589,136 | 3,375,477,351 | $165,326,399 | 1,030,000,000 | $42,885,112 | 259,613,604 | $60,779,817 | 378,664,335 | ' | ' | ' | ' | 3,635,090,955 | 1,408,664,335 | 3,375,477,351 | 1,030,000,000 | 259,613,604 | 378,664,335 | ' | ' | ' | ' | ' | ' | ' |
Available-for-sale investments | ' | ' | ' | $168,000,000 | 1,000,000,000 | $901,932,558 | 5,460,029,129 | $329,760,222 | 2,054,439,158 | $167,906,530 | 1,016,455,767 | $93,985,763 | 585,540,705 | $94,318,772 | 570,977,550 | $23,771,275 | 143,904,165 | $9,290,577 | 56,242,365 | $9,668,243 | 60,234,118 | $6,171,156 | 37,358,327 | ' | ' | ' | ' | ' | ' | ' | ' | 1,016,455,767 | 585,540,705 | 1,016,455,767 | 585,540,705 | ' | ' | ' | ' | ' | ' | 808,482,407 | 60,234,118 | 570,977,550 | 143,904,165 | 56,242,365 | 60,234,118 | 37,358,327 |
FAIR_VALUE_MEASUREMENT_Details1
FAIR VALUE MEASUREMENT (Details 2) | 1 Months Ended | 12 Months Ended | 12 Months Ended | 12 Months Ended | 12 Months Ended | |||||||||||
Dec. 31, 2013 | Oct. 31, 2013 | Nov. 30, 2010 | Jun. 30, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | |
eHi | Easy Go | Dining Secretary | Happy City | Available-for-sale securities | Available-for-sale securities | Available-for-sale securities | Available-for-sale securities | Available-for-sale securities | Available-for-sale securities | Available-for-sale securities | Available-for-sale securities | Available-for-sale securities | Available-for-sale securities | Available-for-sale securities | Available-for-sale securities | |
USD ($) | USD ($) | USD ($) | USD ($) | eHi | eHi | eHi | Easy Go | Easy Go | Easy Go | Dining Secretary | Dining Secretary | Dining Secretary | Happy City | Happy City | Happy City | |
Unobservable inputs (Level 3) | Unobservable inputs (Level 3) | Unobservable inputs (Level 3) | Unobservable inputs (Level 3) | Unobservable inputs (Level 3) | Unobservable inputs (Level 3) | Unobservable inputs (Level 3) | Unobservable inputs (Level 3) | Unobservable inputs (Level 3) | Unobservable inputs (Level 3) | Unobservable inputs (Level 3) | Unobservable inputs (Level 3) | |||||
USD ($) | CNY | Series E Preferred Shares | CNY | USD ($) | Series B Preferred Shares | CNY | CNY | USD ($) | CNY | USD ($) | Series A Preferred Shares | |||||
CNY | CNY | CNY | ||||||||||||||
Roll forward of Level 3 investment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Fair value of Level 3 investment, beginning balance | ' | ' | ' | ' | $94,318,772 | 570,977,550 | ' | ' | $23,771,275 | ' | 60,234,118 | 65,414,773 | $9,290,577 | ' | $6,171,156 | ' |
Investment in preferred shares | -94,050,000 | -23,000,000 | -10,000,000 | -6,000,000 | ' | ' | 570,977,550 | ' | ' | 139,633,000 | ' | ' | ' | ' | ' | 36,715,800 |
Change in fair value of investment | ' | ' | ' | ' | ' | ' | ' | 4,271,165 | ' | ' | -2,227,753 | -4,542,655 | ' | 642,527 | ' | ' |
Effect of exchange rate change | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -1,764,000 | -638,000 | ' | ' | ' | ' |
Fair value of Level 3 investment, ending balance | ' | ' | ' | ' | $94,318,772 | 570,977,550 | ' | 143,904,165 | $23,771,275 | ' | 56,242,365 | 60,234,118 | $9,290,577 | 37,358,327 | $6,171,156 | ' |
FAIR_VALUE_MEASUREMENT_Details2
FAIR VALUE MEASUREMENT (Details 3) (Available-for-sale securities) | 12 Months Ended |
Dec. 31, 2013 | |
Easy Go | Discounted cash flow | ' |
Significant unobservable inputs used in the valuation | ' |
WACC (as a percent) | 28.00% |
Terminal growth rate (as a percent) | 3.00% |
LoMD (as a percent) | 17.50% |
Easy Go | Option pricing model | ' |
Significant unobservable inputs used in the valuation | ' |
Time to liquidation | '1 year 6 months 25 days |
Risk-free rate (as a percent) | 0.96% |
Expected volatility (as a percent) | 36.72% |
Dividend yield (as a percent) | 0.00% |
Easy Go | Option pricing model | Liquidation scenario | ' |
Significant unobservable inputs used in the valuation | ' |
Probability (as a percent) | 55.00% |
Easy Go | Option pricing model | Redemption scenario | ' |
Significant unobservable inputs used in the valuation | ' |
Probability (as a percent) | 40.00% |
Easy Go | Option pricing model | Mandatory Conversion scenario | ' |
Significant unobservable inputs used in the valuation | ' |
Probability (as a percent) | 5.00% |
Dining Secretary | Discounted cash flow | ' |
Significant unobservable inputs used in the valuation | ' |
WACC (as a percent) | 28.00% |
Terminal growth rate (as a percent) | 3.00% |
LoMD (as a percent) | 25.00% |
Dining Secretary | Option pricing model | ' |
Significant unobservable inputs used in the valuation | ' |
Time to liquidation | '2 years |
Risk-free rate (as a percent) | 1.08% |
Expected volatility (as a percent) | 44.90% |
Dividend yield (as a percent) | 0.00% |
Dining Secretary | Option pricing model | Liquidation scenario | ' |
Significant unobservable inputs used in the valuation | ' |
Probability (as a percent) | 45.00% |
Dining Secretary | Option pricing model | Redemption scenario | ' |
Significant unobservable inputs used in the valuation | ' |
Probability (as a percent) | 45.00% |
Dining Secretary | Option pricing model | IPO scenario | ' |
Significant unobservable inputs used in the valuation | ' |
Probability (as a percent) | 10.00% |
Happy City | Discounted cash flow | ' |
Significant unobservable inputs used in the valuation | ' |
WACC (as a percent) | 27.50% |
Terminal growth rate (as a percent) | 3.00% |
LoMD (as a percent) | 35.00% |
Happy City | Option pricing model | ' |
Significant unobservable inputs used in the valuation | ' |
Time to liquidation | '4 years |
Risk-free rate (as a percent) | 1.46% |
Expected volatility (as a percent) | 51.20% |
Dividend yield (as a percent) | 0.00% |
Happy City | Option pricing model | Liquidation scenario | ' |
Significant unobservable inputs used in the valuation | ' |
Probability (as a percent) | 50.00% |
Happy City | Option pricing model | Redemption scenario | ' |
Significant unobservable inputs used in the valuation | ' |
Probability (as a percent) | 50.00% |
GOODWILL_Details
GOODWILL (Details) | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Aug. 31, 2013 | Aug. 31, 2013 | Dec. 31, 2013 | Aug. 31, 2013 | Aug. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 |
USD ($) | CNY | CNY | CNY | B2B hotel reservation company | B2B hotel reservation company | B2B hotel reservation company | Wholesaler operated hotel reservation and air ticketing services | Wholesaler operated hotel reservation and air ticketing services | Wholesaler operated hotel reservation and air ticketing services | Others | Others | |
CNY | USD ($) | CNY | CNY | USD ($) | CNY | CNY | CNY | |||||
Changes in the carrying amount of goodwill | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Balance at beginning of year | $160,650,707 | 972,531,184 | 822,585,341 | 798,601,767 | ' | $12,000,000 | 72,000,000 | ' | $7,000,000 | 44,000,000 | ' | ' |
Acquisition (Disposal) | ' | ' | ' | ' | 72,406,431 | ' | ' | 43,993,740 | ' | ' | ' | ' |
Acquisition (Disposal) of others | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 33,545,672 | 23,983,574 |
Balance at end of period | $160,650,707 | 972,531,184 | 822,585,341 | 798,601,767 | ' | $12,000,000 | 72,000,000 | ' | $7,000,000 | 44,000,000 | ' | ' |
Percentage of interest purchased | ' | ' | ' | ' | ' | 51.00% | 51.00% | ' | 100.00% | 100.00% | ' | ' |
INTANGIBLE_ASSETS_Details
INTANGIBLE ASSETS (Details) (CNY) | Dec. 31, 2013 | Dec. 31, 2012 |
Intangible assets disclosures | ' | ' |
Intangible assets | 393,663,987 | 351,131,021 |
Less: accumulated amortization | -37,010,965 | -29,647,601 |
Net book value | 356,653,022 | 321,483,420 |
Trademark | ' | ' |
Intangible assets disclosures | ' | ' |
Intangible assets not subject to amortization | 314,329,235 | 290,715,235 |
Net book value - intangible assets not subject to amortization | 314,329,235 | 290,715,235 |
Golf Membership Certificate | ' | ' |
Intangible assets disclosures | ' | ' |
Intangible assets not subject to amortization | 4,200,000 | 4,200,000 |
Net book value - intangible assets not subject to amortization | 4,200,000 | 4,200,000 |
Others | ' | ' |
Intangible assets disclosures | ' | ' |
Intangible assets not subject to amortization | 8,785,287 | 8,736,321 |
Net book value - intangible assets not subject to amortization | 8,785,287 | 8,736,321 |
Non-compete agreements | ' | ' |
Intangible assets disclosures | ' | ' |
Intangible assets to be amortized | 11,479,610 | 11,479,610 |
Less: accumulated amortization | -11,479,610 | -9,183,688 |
Net book value - intangible assets to be amortized | ' | 2,295,922 |
Customer list | ' | ' |
Intangible assets disclosures | ' | ' |
Intangible assets to be amortized | 15,942,578 | 15,942,578 |
Less: accumulated amortization | -11,982,578 | -10,499,636 |
Net book value - intangible assets to be amortized | 3,960,000 | 5,442,942 |
Supplier relationship | ' | ' |
Intangible assets disclosures | ' | ' |
Intangible assets to be amortized | 27,780,000 | 9,700,000 |
Less: accumulated amortization | -3,178,333 | -1,455,000 |
Net book value - intangible assets to be amortized | 24,601,667 | 8,245,000 |
Technology patent | ' | ' |
Intangible assets disclosures | ' | ' |
Intangible assets to be amortized | 9,240,000 | 9,240,000 |
Less: accumulated amortization | -9,240,000 | -7,392,000 |
Net book value - intangible assets to be amortized | ' | 1,848,000 |
Cross-border travel agency license | ' | ' |
Intangible assets disclosures | ' | ' |
Intangible assets to be amortized | 1,117,277 | 1,117,277 |
Less: accumulated amortization | -1,117,277 | -1,117,277 |
Others | ' | ' |
Intangible assets disclosures | ' | ' |
Intangible assets to be amortized | 790,000 | ' |
Net book value - intangible assets not subject to amortization | 776,833 | ' |
Less: accumulated amortization | -13,167 | ' |
INTANGIBLE_ASSETS_Details_2
INTANGIBLE ASSETS (Details 2) (CNY) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
INTANGIBLE ASSETS | ' | ' | ' |
Amortization of intangible assets | 7,363,364 | 7,736,767 | 8,445,950 |
Annual estimated amortization expense for intangible assets subject to amortization | ' | ' | ' |
2014 | 3,416,000 | ' | ' |
2015 | 3,416,000 | ' | ' |
2016 | 3,416,000 | ' | ' |
2017 | 3,416,000 | ' | ' |
2018 | 3,402,833 | ' | ' |
Total | 17,066,833 | ' | ' |
SHORTTERM_BORROWINGS_Details
SHORT-TERM BORROWINGS (Details) | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Jun. 30, 2013 | Jun. 30, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Jun. 30, 2012 | Nov. 30, 2013 | Dec. 31, 2013 | Nov. 30, 2013 | Aug. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Aug. 31, 2013 |
USD ($) | CNY | CNY | China Construction Bank | China Construction Bank | China Construction Bank | China Construction Bank | China Construction Bank | China Construction Bank | China Construction Bank | China Construction Bank | Agricultural Bank of China | Agricultural Bank of China | Agricultural Bank of China | Agricultural Bank of China | |
Loan facility entered in June 2012 | Loan facility entered in June 2012 | Loan facility entered in June 2012 | Loan facility entered in June 2012 | Loan facility entered in June 2012 | Loan facility entered in November 2013 | Loan facility entered in November 2013 | Loan facility entered in November 2013 | CNY | USD ($) | CNY | USD ($) | ||||
CNY | USD ($) | CNY | USD ($) | CNY | USD ($) | item | item | ||||||||
item | item | item | |||||||||||||
Short-term borrowings | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum borrowing capacity | ' | ' | ' | ' | ' | ' | ' | $72,750,000 | ' | ' | $40,000,000 | ' | ' | ' | $40,000,000 |
Extended maturity term | ' | ' | ' | '12 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maturity term | ' | ' | ' | ' | ' | ' | ' | ' | '3 months | ' | ' | '12 months | ' | ' | ' |
Bank deposit by which facility is collateralized | ' | ' | ' | ' | 500,000,000 | ' | ' | ' | 270,000,000 | ' | ' | 270,000,000 | ' | ' | ' |
Number of subsidiaries which have provided bank deposits as collateral | ' | ' | ' | ' | ' | ' | ' | 1 | ' | ' | 1 | ' | ' | ' | 1 |
Aggregate borrowings under the facility | $127,954,696 | 774,599,341 | 453,478,628 | ' | ' | $73,000,000 | 441,000,000 | ' | 243,000,000 | ' | $40,000,000 | ' | $15,000,000 | 91,000,000 | ' |
Interest rate (as a percent) | ' | ' | ' | ' | ' | 2.40% | 2.40% | ' | ' | 2.40% | ' | ' | 2.40% | 2.40% | ' |
Number of borrowings under the facility | ' | ' | ' | ' | ' | 3 | 3 | ' | ' | ' | ' | ' | 2 | 2 | ' |
RELATED_PARTY_TRANSACTIONS_Det
RELATED PARTY TRANSACTIONS (Details) | 12 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | 12 Months Ended | 0 Months Ended | 1 Months Ended | 12 Months Ended | |||||||||||||||||
Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 03, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Nov. 30, 2013 | 31-May-12 | Dec. 31, 2013 | Dec. 31, 2012 | |
USD ($) | CNY | CNY | Keystone | Home Inns | Home Inns | Home Inns | Hanting | Hanting | Hanting | Yishang Network | Yishang Network | 7 Days Group Holdings Limited (7 Days) | 7 Days Group Holdings Limited (7 Days) | Ananda Travel Service (Aust.) Pty Limited ("Ananda") | Ananda Travel Service (Aust.) Pty Limited ("Ananda") | Ananda Travel Service (Aust.) Pty Limited ("Ananda") | Joyu Tourism Operating Group ("Joyu") | Joyu Tourism Operating Group ("Joyu") | Starway Hong Kong | Starway Hong Kong | Starway Hong Kong | Starway Hong Kong | Starway Hong Kong | Starway Hong Kong | |
CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | Keystone | CNY | CNY | CNY | CNY | CNY | CNY | CNY | Hanting | Hanting | Hanting | Hanting | |||||
item | CNY | CNY | CNY | CNY | |||||||||||||||||||||
RELATED PARTY TRANSACTIONS | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Commissions from related parties | ' | ' | ' | ' | 38,709,984 | 35,932,452 | 17,660,504 | 17,127,847 | 10,988,806 | 7,965,109 | ' | ' | 1,214,368 | ' | ' | ' | ' | ' | ' | 6,146,474 | 7,118,150 | ' | ' | ' | ' |
Consideration for disposal majority equity share of Starway Hong Kong from Hanting | 2,171,056 | 13,142,920 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 16,500,000 | 17,100,000 | 16,459,926 | 17,131,759 |
Amount of entursted loan and interest | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 13,000,000 | 13,374,109 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Purchases from related party | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 32,738,333 | 32,989,774 | 29,386,855 | 2,160,000 | 2,160,000 | ' | ' | ' | ' | ' | ' |
Transferred equity percentage | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 49.00% | 51.00% | ' | ' |
Equity interest (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.00% | ' | ' | ' | ' | ' |
Number of shared directors | ' | ' | ' | ' | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Purchase price receivable | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 12,250,000 | ' | ' | ' |
Period of installment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '3 years | ' | ' | ' |
Term of the loan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '1 year | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of equity interest acquired | ' | ' | ' | 4.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Due from related parties, current | 3,596,919 | 21,774,669 | 5,328,170 | ' | 3,029,166 | 3,797,931 | ' | 5,592,854 | 627,145 | ' | ' | 13,152,649 | ' | ' | ' | ' | ' | ' | ' | ' | 903,094 | ' | ' | ' | ' |
Due from related parties, non-current | 1,349,037 | 8,166,667 | ' | ' | ' | ' | ' | 8,166,667 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Due to related parties, current | $1,852,880 | 11,216,780 | 10,395,726 | ' | ' | ' | ' | 1,000,000 | 1,000,000 | ' | ' | ' | ' | ' | 10,216,780 | 9,215,726 | ' | 180,000 | ' | ' | ' | ' | ' | ' | ' |
EMPLOYEE_BENEFITS_Details
EMPLOYEE BENEFITS (Details) (CNY) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
EMPLOYEE BENEFITS | ' | ' | ' |
Expense of Employee Benefits | 440,884,906 | 334,150,368 | 234,725,030 |
TAXATION_Details
TAXATION (Details) (CNY) | 12 Months Ended | 120 Months Ended | 12 Months Ended | ||||||||||||||||||||||||||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2010 | Dec. 31, 2009 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2009 | Dec. 31, 2008 | Dec. 31, 2007 | Dec. 31, 2013 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2010 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | |
Hong Kong Profits Tax | Taiwan Enterprise Income Tax | Taiwan Enterprise Income Tax | Taiwan Enterprise Income Tax | PRC Corporate Income Tax | PRC Corporate Income Tax | PRC Corporate Income Tax | PRC Corporate Income Tax | PRC Corporate Income Tax | PRC Corporate Income Tax | PRC Corporate Income Tax | PRC Corporate Income Tax | PRC Corporate Income Tax | PRC Corporate Income Tax | PRC Corporate Income Tax | PRC Corporate Income Tax | PRC Corporate Income Tax | PRC Corporate Income Tax | PRC Corporate Income Tax | PRC Corporate Income Tax | PRC Corporate Income Tax | PRC Corporate Income Tax | PRC Corporate Income Tax | PRC Corporate Income Tax | PRC Corporate Income Tax | PRC Corporate Income Tax | PRC Corporate Income Tax | PRC Corporate Income Tax | PRC Corporate Income Tax | PRC Corporate Income Tax | ||||
Shenzhen | Shenzhen | Shenzhen | Shenzhen | Shenzhen | Shenzhen | Shenzhen | Western region of China | Western region of China | Western region of China | Western region of China | Western region of China | Western region of China | Western region of China | Western region of China | Western region of China | Western region of China | Western region of China | High new tech enterprises | High new tech enterprises | High new tech enterprises | High new tech enterprises | High new tech enterprises | High new tech enterprises | High new tech enterprises | |||||||||
Shenzhen Ctrip | Shenzhen Ctrip | Shenzhen Ctrip | Shenzhen Ctrip | Shenzhen Ctrip | Shenzhen Ctrip | Shenzhen Ctrip | Chengdu Ctrip | Chengdu Ctrip | Chengdu Ctrip | Chengdu Ctrip International | Chengdu Ctrip International | Chengdu Ctrip International | Chengdu Information | Chengdu Information | item | Ctrip Computer Technology | Ctrip Travel Information | Ctrip Travel Network | Software Hotel Information | ||||||||||||||
Tax period 2012 to 2014 | Tax period 2012 to 2014 | Tax period 2012 to 2014 | Tax period 2013 to 2016 | ||||||||||||||||||||||||||||||
Taxation | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Applicable tax rate (as a percent) | 25.00% | 25.00% | 25.00% | 16.50% | 17.00% | 17.00% | 25.00% | 25.00% | 25.00% | 25.00% | 24.00% | 22.00% | 20.00% | 18.00% | 15.00% | ' | 15.00% | 15.00% | 15.00% | 15.00% | ' | 15.00% | ' | ' | 15.00% | ' | 15.00% | ' | ' | 15.00% | 15.00% | 15.00% | 15.00% |
Applicable tax rate approved (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 15.00% | ' | 15.00% | 15.00% | ' | 15.00% | ' | ' | ' | ' | ' | ' | ' |
Qualification effective period expired | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '3 years | ' | ' | ' | ' |
Number of entities that reapplied for High New Tech Enterprises qualification and got approval | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4 | ' | ' | ' | ' | ' |
Reduction rate upon statutory income tax rate (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Withholding tax (as a percent) | ' | ' | ' | 5.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Deferred tax liability provided on the outside basis difference from undistributed earnings | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
TAXATION_Details_2
TAXATION (Details 2) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2012 | Jun. 13, 2012 | Jan. 02, 2008 |
CNY | China | China | China | China | |
USD ($) | CNY | USD ($) | CNY | ||
Tax rate disclosure | ' | ' | ' | ' | ' |
Amount approved as payment of dividend to purchase ADSs | ' | ' | ' | $300,000,000 | ' |
PRC withholding tax (as a percent) | ' | 5.00% | 5.00% | ' | ' |
Accrued withholding tax for dividend distribution | ' | 15,000,000 | 95,000,000 | ' | ' |
Undistributed earnings of foreign subsidiaries | ' | ' | ' | ' | 4,600,000,000 |
Deferred tax liability provided on the outside basis difference for the remaining undistributed earnings | 0 | ' | ' | ' | ' |
TAXATION_Details_3
TAXATION (Details 3) | 3 Months Ended | 12 Months Ended | |||
Jun. 30, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
USD ($) | CNY | CNY | CNY | ||
TAXATION | ' | ' | ' | ' | ' |
Current income tax expense | ' | ' | 329,612,294 | 317,283,820 | 265,574,760 |
Deferred tax benefit | ' | -5,925,628 | -35,871,972 | -22,757,864 | -3,388,535 |
Income tax expense | ' | $48,522,444 | 293,740,322 | 294,525,956 | 262,186,225 |
Withholding tax rate (as a percent) | 5.00% | ' | ' | 10.00% | ' |
TAXATION_Details_4
TAXATION (Details 4) | 3 Months Ended | 12 Months Ended | |||
Jun. 30, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | |
CNY | CNY | CNY | USD ($) | ||
Reconciliation of differences between statutory tax rate and effective tax rate | ' | ' | ' | ' | ' |
Statutory CIT rate (as a percent) | ' | 25.00% | 25.00% | 25.00% | ' |
Tax differential from statutory rate applicable to Subsidiaries in the PRC (as a percent) | ' | -15.00% | -17.00% | -10.00% | ' |
Non-deductible expenses incurred (as a percent) | ' | 16.00% | 13.00% | 6.00% | ' |
Withholding tax rate (as a percent) | 5.00% | ' | 10.00% | ' | ' |
Others (as a percent) | ' | 0.00% | 0.00% | -1.00% | ' |
Effective CIT rate (as a percent) | ' | 26.00% | 31.00% | 20.00% | ' |
Deferred tax assets: | ' | ' | ' | ' | ' |
Loss carry forward | ' | 86,735,795 | 42,205,411 | ' | ' |
Accrued liability for customer reward related programs | ' | 60,078,932 | 32,209,006 | ' | ' |
Accrued staff salary | ' | 34,842,016 | 22,215,827 | ' | ' |
Deferred tax liabilities | ' | -390,000 | -390,000 | ' | ' |
Others | ' | 2,448,552 | 3,452,556 | ' | ' |
Less: Valuation allowance of deferred tax assets | ' | -86,735,795 | -37,852,274 | -14,785,786 | ' |
Total deferred tax assets | ' | 96,979,500 | 61,840,526 | ' | 16,019,872 |
Deferred tax liabilities, non-current: | ' | ' | ' | ' | ' |
Recognition of intangible assets | ' | -63,197,155 | -53,309,153 | ' | ' |
Net deferred tax assets | ' | 33,782,345 | 8,531,373 | ' | ' |
Operating tax loss carry forwards | ' | 347,000,000 | ' | ' | ' |
Movement of valuation allowances | ' | ' | ' | ' | ' |
Balance at beginning of year | ' | 37,852,274 | 14,785,786 | 12,733,226 | ' |
Current year additions | ' | 48,883,521 | 27,991,746 | 2,879,759 | ' |
Current year disposal due to divestitures | ' | ' | -4,925,258 | -827,199 | ' |
Balance at end of year | ' | 86,735,795 | 37,852,274 | 14,785,786 | ' |
TAXATION_Details_5
TAXATION (Details 5) (CNY) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Income tax holiday | ' | ' | ' |
Tax holiday effect | 146,321,156 | 119,971,884 | 115,750,217 |
ADS | ' | ' | ' |
Income tax holiday | ' | ' | ' |
Basic net income per share effect (in dollars per share) | 1.11 | 0.88 | 0.8 |
Diluted net income per share effect (in dollars per share) | 0.96 | 0.83 | 0.76 |
OTHER_PAYABLES_AND_ACCRUALS_De
OTHER PAYABLES AND ACCRUALS (Details) | 12 Months Ended | |||
Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
USD ($) | CNY | CNY | CNY | |
OTHER PAYABLES AND ACCRUALS | ' | ' | ' | ' |
Accrued operating expenses | ' | 330,863,616 | 204,438,348 | ' |
Electronic coupon | ' | 133,306,380 | 41,475,136 | ' |
Accruals for property and equipment | 6,118,357 | 37,038,698 | 34,450,253 | 32,195,338 |
Deposits received from suppliers and packaged-tour customers | ' | 33,769,690 | 10,161,612 | ' |
Due to employees for stock option proceeds received on their behalf | ' | 28,413,780 | 13,242,768 | ' |
Payable for acquisition | ' | 23,773,221 | 19,742,776 | ' |
Interest payable | ' | 13,838,961 | 1,492,269 | ' |
Others | ' | 34,100,603 | 18,754,719 | ' |
Total | $104,911,864 | 635,104,949 | 343,757,881 | ' |
LONGTERM_DEBT_Details
LONG-TERM DEBT (Details) | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | |||||||||||||
Share data in Millions, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Sep. 24, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Sep. 24, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Oct. 17, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Oct. 17, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 |
USD ($) | CNY | CNY | 2017 Convertible Senior Notes | 2017 Convertible Senior Notes | 2017 Convertible Senior Notes | 2017 Convertible Senior Notes | 2017 Convertible Senior Notes | 2017 Convertible Senior Notes | 2017 Convertible Senior Notes | 2017 Convertible Senior Notes | 2017 Convertible Senior Notes | 2017 Convertible Senior Notes | 2017 Convertible Senior Notes | 2018 Convertible Senior Notes | 2018 Convertible Senior Notes | 2018 Convertible Senior Notes | 2018 Convertible Senior Notes | 2018 Convertible Senior Notes | 2018 Convertible Senior Notes | 2018 Convertible Senior Notes | 2018 Convertible Senior Notes | |
USD ($) | USD ($) | CNY | CNY | ADS | ADS | ADS | ADS | ADS | ADS | ADS | USD ($) | USD ($) | CNY | ADS | ADS | ADS | ADS | ADS | ||||
USD ($) | USD ($) | Minimum | Maximum | Purchased call option | Sold Warrants | Sold Warrants | USD ($) | USD ($) | Purchased call option | Sold Warrants | Sold Warrants | |||||||||||
Long | USD ($) | Maximum | Long | USD ($) | Maximum | |||||||||||||||||
Maximum | Maximum | |||||||||||||||||||||
LONG-TERM DEBT | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Value of the Notes | $934,500,000 | 5,657,182,650 | 1,121,418,000 | ' | $134,500,000 | 814,222,650 | 1,121,418,000 | ' | ' | ' | ' | ' | ' | ' | ' | $800,000,000 | 4,842,960,000 | ' | ' | ' | ' | ' |
Aggregate principle amount | ' | ' | ' | 180,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 800,000,000 | ' | ' | ' | ' | ' | ' | ' |
Interest rate (as a percent) | ' | ' | ' | 0.50% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.25% | ' | ' | ' | ' | ' | ' | ' |
Initial conversion rate | ' | ' | ' | ' | ' | ' | ' | 0.0517116 | 0.0517116 | ' | ' | ' | ' | ' | ' | ' | ' | 0.0127568 | ' | ' | ' | ' |
Initial conversion price (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | $19.34 | ' | ' | ' | ' | ' | ' | ' | ' | ' | $78.39 | ' | ' | ' | ' |
Percentage of cash incentive | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.50% | 2.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount of notes tendered | ' | ' | ' | ' | ' | ' | ' | ' | 45,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of instruments | ' | ' | ' | ' | ' | ' | ' | ' | 2.35 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total cash paid | ' | ' | ' | ' | ' | ' | ' | ' | 777,445 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accrued and unpaid interest | ' | ' | ' | ' | ' | ' | ' | ' | 19,945 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Inducement premium | ' | ' | ' | ' | ' | ' | ' | ' | 757,500 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Proceeds from early termination of call option | 11,607,929 | 70,270,919 | ' | ' | 11,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Proceeds from issuance of convertible debt | 780,268,550 | 4,723,511,720 | 1,097,195,400 | 175,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 780,000,000 | ' | ' | ' | ' | ' | ' | ' |
Debt issuance costs | ' | ' | ' | 5,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 19,600,000 | ' | ' | ' | ' | ' | ' | ' |
Percentage of principal amount at which the entity is required to repurchase debt under non-contingent option | ' | ' | ' | ' | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1 | 1 | ' | ' | ' | ' | ' |
Percentage of principal amount at which the entity may be required to repurchase debt under contingent option | ' | ' | ' | ' | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1 | 1 | ' | ' | ' | ' | ' |
Increased initial conversion price, after effect of call option and warrants (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | $26.37 | ' | ' | ' | ' | ' | ' | ' | ' | ' | $96.27 | ' | ' | ' |
Proceeds from sale of warrants | $77,777,046 | 470,838,904 | 167,503,950 | ' | ' | ' | ' | ' | ' | ' | ' | ' | $26,600,000 | ' | ' | ' | ' | ' | ' | ' | $77,200,000 | ' |
Number of shares that can be purchased from warrants sold | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9.3 | ' | ' | ' | ' | ' | ' | ' | 10.2 |
Exercise price of warrants sold (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $26.37 | ' | ' | ' | ' | ' | ' | ' | $96.27 | ' |
Expected life of warrants | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 years | ' | ' | ' | ' | ' | ' | ' | '5 years | ' |
Number of shares agreed to be sold by the counterparty on exercise of Purchased Call option | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9.3 | ' | ' | ' | ' | ' | ' | ' | 10.2 | ' | ' |
TREASURY_STOCK_Details
TREASURY STOCK (Details) | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Oct. 31, 2013 | Sep. 26, 2012 | Dec. 19, 2012 | Sep. 26, 2012 | Dec. 19, 2012 | Sep. 26, 2012 | Sep. 26, 2012 |
USD ($) | CNY | CNY | 2012 Convertible Senior Notes | Capped call option | Capped call option | Capped call option | Capped call option | Written call option | Written call option | |
USD ($) | USD ($) | American Depository Shares | American Depository Shares | American Depository Shares | American Depository Shares | American Depository Shares | ||||
item | USD ($) | USD ($) | Maximum | Long | Short | |||||
item | USD ($) | USD ($) | ||||||||
Treasure stock | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Initial notional amount of derivative | ' | ' | ' | ' | $75,000,000 | ' | ' | ' | ' | ' |
Number of treasury stock to be repurchased as per the Agreement | ' | ' | ' | ' | ' | ' | ' | 4,400,000 | ' | ' |
Number of components of the Agreements | ' | ' | ' | ' | 2 | ' | ' | ' | ' | ' |
Treasure stock repurchase prepayment | ' | ' | ' | ' | ' | ' | ' | ' | ' | 62,182,346 |
Strike price (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | $14.36 | $0.00 |
Total strike notion amount | ' | ' | ' | ' | ' | ' | 63,749,958 | ' | ' | ' |
Premium that will be retained upon maturity, if trading price of stock gets above upper strike price | ' | ' | ' | ' | ' | 1,567,612 | ' | ' | ' | ' |
Initial cash prepayment that will be retained upon maturity, if trading price of stock gets above upper strike price | ' | ' | ' | ' | ' | 62,182,346 | ' | ' | ' | ' |
Cash settlement amount | ' | ' | ' | ' | ' | 63,749,958 | ' | ' | ' | ' |
Number of shares to be received upon maturity if trading price of stock gets below upper strike price | ' | ' | ' | ' | ' | 4,438,763 | ' | ' | ' | ' |
Settlement amount received | ' | ' | ' | ' | ' | 63,700,000 | ' | ' | ' | ' |
Amount of convertible notes early converted | ' | ' | ' | 45,500,000 | ' | ' | ' | ' | ' | ' |
Stock delivered to the notes holders (in shares) | ' | ' | ' | 588,219 | ' | ' | ' | ' | ' | ' |
Treasury stock, shares | 3,777,087 | 3,777,087 | 4,365,306 | ' | ' | ' | ' | ' | ' | ' |
Treasury stock at cost | $256,230,284 | 1,551,141,268 | 1,891,888,900 | ' | ' | ' | ' | ' | ' | ' |
NONCONTROLLING_INTERESTS_Detai
NON-CONTROLLING INTERESTS (Details) | 12 Months Ended | 1 Months Ended | |||||||||
Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Oct. 31, 2012 | Feb. 28, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | |
USD ($) | CNY | CNY | Tujia | Tujia | Tujia | Tujia | ezTravel | ezTravel | Others | Others | |
CNY | CNY | Series A preferred shares | Series B preferred shares | CNY | CNY | CNY | CNY | ||||
USD ($) | USD ($) | ||||||||||
NON-CONTROLLING INTERESTS | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Non-controlling interests | $32,986,509 | 199,690,428 | 95,247,538 | 83,133,600 | 40,250,981 | ' | ' | 21,475,705 | 21,269,409 | 95,081,123 | 33,727,148 |
Shares issued under the share purchase agreement (in shares) | ' | ' | ' | ' | ' | 70,380,000 | 33,333,333 | ' | ' | ' | ' |
Aggregate consideration from issuance of convertible preferred shares | $21,922,128 | 132,709,989 | 63,709,828 | ' | ' | $14,600,000 | $36,700,000 | ' | ' | ' | ' |
EARNINGS_PER_SHARE_Details
EARNINGS PER SHARE (Details) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
USD ($) | CNY | CNY | CNY | Stock options | Stock options | Stock options | Sold Warrants | Sold Warrants | Ordinary shares | Ordinary shares | Ordinary shares | Ordinary shares | ADS | ADS | ADS | ADS | |
USD ($) | CNY | CNY | CNY | USD ($) | CNY | CNY | CNY | ||||||||||
Numerator: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income attributable to Ctrip's shareholders | $164,910,665 | 998,319,684 | 714,405,864 | 1,076,414,897 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Eliminate the dilutive effect of interest expense of convertible bond | ' | 15,496,021 | 4,617,398 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Numerator for diluted earnings per share | ' | 1,013,815,705 | 719,023,262 | 1,076,414,897 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Denominator: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Denominator for basic earnings per ordinary share - weighted average ordinary shares outstanding | 32,905,601 | 32,905,601 | 34,236,761 | 35,977,063 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Dilutive effect of share options | 2,359,614 | 2,359,614 | 1,230,941 | 2,053,911 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Dilutive effect of convertible bond | 2,206,157 | 2,206,157 | 623,083 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Dilutive effect of convertible bond sold warrants | 598,469 | 598,469 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Denominator for diluted earnings per ordinary share | 38,069,841 | 38,069,841 | 36,090,785 | 38,030,974 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Earning per share | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basic (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | $5.01 | 30.34 | 20.87 | 29.92 | $1.52 | 7.58 | 5.22 | 7.48 |
Diluted (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | $4.40 | 26.63 | 19.92 | 28.3 | $1.10 | 6.66 | 4.98 | 7.08 |
Number of outstanding weighted average ordinary shares excluded from the calculation of diluted earnings per common share | 1,121,691 | 1,121,691 | 2,078,826 | 715,894 | 251,266 | 1,779,507 | 715,894 | 870,425 | 299,319 | ' | ' | ' | ' | ' | ' | ' | ' |
COMMITMENTS_AND_CONTINGENCIES_1
COMMITMENTS AND CONTINGENCIES (Details) (CNY) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Operating lease commitments | ' | ' | ' |
2014 | 49,445,429 | ' | ' |
2015 | 35,829,711 | ' | ' |
2016 | 15,077,517 | ' | ' |
2017 | 5,155,184 | ' | ' |
2018 | 2,395,381 | ' | ' |
Thereafter | 610,087 | ' | ' |
Total | 108,513,309 | ' | ' |
Operating lease, rental expense | ' | ' | ' |
Operating lease, rental expense | 118,261,449 | 94,213,513 | 66,208,557 |
Capital commitments | ' | ' | ' |
Outstanding Capital Commitments | 376,000,000 | ' | ' |
Guarantee | ' | ' | ' |
Guarantee Arrangement | 877,000,000 | ' | ' |
SUBSEQUENT_EVENTS_Details
SUBSEQUENT EVENTS (Details) | 12 Months Ended | 1 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2013 | Jan. 31, 2014 |
Toursforfun | Toursforfun | Subsequent event | |
USD ($) | Prepayments and Other Current Assets [Member] | China Lodging Group | |
USD ($) | CNY | ||
Subsequent events | ' | ' | ' |
Amount of entrusted loan | ' | ' | 300 |
Term of the loan | ' | ' | '1 year |
Cumulative consideration | 23.09 | ' | ' |
Amount of prepayment for business acquisition | ' | $1 | ' |