Document_and_Entity_Informatio
Document and Entity Information | 12 Months Ended |
Dec. 31, 2014 | |
Document and Entity Information | |
Entity Registrant Name | JIAYUAN.COM INTERNATIONAL LTD |
Entity Central Index Key | 1511683 |
Document Type | 20-F |
Document Period End Date | 31-Dec-14 |
Amendment Flag | FALSE |
Current Fiscal Year End Date | -19 |
Entity Well-known Seasoned Issuer | No |
Entity Voluntary Filers | No |
Entity Current Reporting Status | Yes |
Entity Filer Category | Accelerated Filer |
Entity Common Stock, Shares Outstanding | 49,930,944 |
Document Fiscal Year Focus | 2014 |
Document Fiscal Period Focus | FY |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | USD ($) | CNY | CNY |
Current assets: | |||
Cash and cash equivalents | $31,728 | 196,857 | 232,613 |
Short-term deposits | 38,595 | 239,466 | 336,299 |
Available-for-sale securities | 2,533 | 15,715 | 5,233 |
Accounts receivable, net | 6,083 | 37,745 | 33,987 |
Deferred tax assets | 1,448 | 8,982 | 3,628 |
Prepaid expenses and other current assets | 10,718 | 66,501 | 23,695 |
Total current assets | 91,105 | 565,266 | 635,455 |
Non-current assets: | |||
Investment in equity investee | 1,781 | 11,048 | |
Property and equipment, net | 14,778 | 91,694 | 99,484 |
Intangible assets, net | 582 | 3,610 | 4,275 |
Goodwill | 127 | 789 | 789 |
Other non-current assets | 167 | 1,039 | |
Total assets | 108,540 | 673,446 | 740,003 |
Current liabilities: | |||
Accounts payable (including accounts payable of the consolidated variable interest entities and VIE's subsidiary without recourse to the Company of RMB5,864 and RMB20,692 as of December 31, 2013 and 2014, respectively) | 3,335 | 20,692 | 5,864 |
Deferred revenue, current portion (including deferred revenue, current portion of the consolidated variable interest entities and VIE's subsidiary without recourse to the Company of RMB125,391and RMB 189,018 as of December 31, 2013 and 2014, respectively) | 30,464 | 189,018 | 125,391 |
Accrued expenses and other liabilities, current portion (including accrued expenses and other current liabilities, current portion, of the consolidated variable interest entities and VIE's subsidiary without recourse to the Company of RMB34,843 and RMB38,243 as of December 31, 2013 and 2014, respectively) | 7,332 | 45,490 | 39,615 |
Income tax payable (including income tax payable of the consolidated variable interest entities and VIE's subsidiary without recourse to the Company of RMB20,606 and RMB16,927 as of December 31, 2013 and 2014, respectively) | 3,068 | 19,037 | 22,226 |
Total current liabilities | 44,199 | 274,237 | 193,096 |
Non-current liabilities: | |||
Deferred revenue, non-current portion (including deferred revenue, non-current portion, of the consolidated variable interest entities and VIE's subsidiary without recourse to the Company of RMB369 and RMB2 as of December 31, 2013 and 2014, respectively) | 0 | 2 | 369 |
Accrued expenses and other liabilities, non-current portion (including other non-current liabilities of the consolidated variable interest entities and VIE's subsidiary without recourse to the Company of RMB 2,730 and RMB5,650 as of December 31, 2013 and 2014, respectively) | 911 | 5,650 | 2,730 |
Deferred tax liability | 1,050 | 6,517 | 4,590 |
Total liabilities | 46,160 | 286,406 | 200,785 |
Commitments and contingencies (Note 18) | |||
SHAREHOLDERS' EQUITY | |||
Ordinary shares (US$0.001 par value; 100,000,000 shares authorized as of December 31, 2013 and 2014; 49,030,944 shares issued and outstanding as of December 31, 2013; 49,930,944 shares issued and outstanding as of December 31, 2014) | 57 | 354 | 349 |
Additional paid-in capital | 57,823 | 358,768 | 506,458 |
Less: Treasury shares (4,145,729 and 5,310,240 shares as of December 31, 2013 and 2014, respectively) | -18,934 | -117,480 | -91,100 |
Statutory reserves | 1,628 | 10,103 | 9,974 |
Retained earnings | 23,587 | 146,345 | 126,367 |
Accumulated other comprehensive loss | -1,781 | -11,050 | -12,830 |
Total shareholders' equity | 62,380 | 387,040 | 539,218 |
Total liabilities and shareholders' equity | $108,540 | 673,446 | 740,003 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical)(Consolidated VIEs without recourse to the Company CNY) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, except Share data, unless otherwise specified | ||
Accounts payable | 20,692 | 5,864 |
Deferred revenue, current portion | 189,018 | 125,391 |
Accrued expenses and other liabilities, current portion | 38,243 | 34,843 |
Income tax payable | 16,927 | 20,606 |
Deferred revenue, non-current portion | 2 | 369 |
Accrued expenses and other liabilities, non-current portion | 5,650 | 2,730 |
CONSOLIDATED_STATEMENTS_OF_COM
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | 12 Months Ended | |||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
USD ($) | CNY | CNY | CNY | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||||
Net revenues | $98,957 | 613,990 | 492,606 | 410,803 |
Cost of revenues | -44,772 | -277,789 | -180,521 | -143,685 |
Gross profit | 54,185 | 336,201 | 312,085 | 267,118 |
Operating expenses: | ||||
Selling and marketing expenses | -40,734 | -252,736 | -183,619 | -143,376 |
General and administrative expenses | -9,359 | -58,071 | -52,565 | -54,367 |
Research and development expenses | -3,731 | -23,149 | -21,918 | -17,587 |
Total operating expenses | -53,824 | -333,956 | -258,102 | -215,330 |
Operating income | 361 | 2,245 | 53,983 | 51,788 |
Interest income | 2,846 | 17,658 | 11,687 | 13,323 |
Foreign currency exchange (loss)/income , net | -219 | -1,361 | 1,935 | -1,845 |
Other income, net | 737 | 4,572 | 9,104 | 4,898 |
Income before income tax | 3,725 | 23,114 | 76,709 | 68,164 |
Income tax expenses | -485 | -3,007 | -13,053 | -9,227 |
Net income | 3,240 | 20,107 | 63,656 | 58,937 |
Net income | 3,240 | 20,107 | 63,656 | 58,937 |
Other comprehensive (loss)/income: | ||||
Foreign currency translation adjustments, net of tax of RMB nil | 287 | 1,780 | -9,018 | -772 |
Comprehensive income | $3,527 | 21,887 | 54,638 | 58,165 |
Net income per share: | ||||
Basic (in CNY and dollars per share) | $0.07 | 0.45 | 1.42 | 1.27 |
Diluted (in CNY and dollars per share) | $0.07 | 0.44 | 1.39 | 1.23 |
Weighted average shares used in calculating net income per share, basic (in shares) | 44,423,885 | 44,423,885 | 44,910,676 | 46,297,314 |
Weighted average shares used in calculating net income per share, diluted (in shares) | 45,390,809 | 45,390,809 | 45,827,922 | 47,743,098 |
Net income per ADS: | ||||
Basic (in CNY and dollars per share) | $0.11 | 0.68 | 2.13 | 1.91 |
Diluted (in CNY and dollars per share) | $0.11 | 0.66 | 2.08 | 1.85 |
Weighted average shares used in calculating net income per ADS, basic (in shares) | 29,615,923 | 29,615,923 | 29,940,450 | 30,864,876 |
Weighted average shares used in calculating net income per ADS, diluted (in shares) | 30,260,539 | 30,260,539 | 30,551,948 | 31,828,732 |
CONSOLIDATED_STATEMENTS_OF_COM1
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) (CNY) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | |||
Tax effect of foreign currency translation adjustments | 0 | 0 | 0 |
CONSOLIDATED_STATEMENTS_OF_CHA
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY | Outstanding ordinary shares | Additional paid-in capital | Treasury shares | Statutory reserves | Retained earnings | Accumulated other comprehensive loss | Total | Total |
In Thousands, except Share data, unless otherwise specified | CNY | CNY | CNY | CNY | CNY | CNY | USD ($) | CNY |
Balance at Dec. 31, 2011 | 339 | 522,470 | 5,792 | 7,956 | -3,040 | 533,517 | ||
Balance (in shares) at Dec. 31, 2011 | 47,489,394 | |||||||
Increase (Decrease) in Shareholders' Equity | ||||||||
Net income | 58,937 | 58,937 | ||||||
Issuance of ordinary shares upon exercise of options | 6 | 6,037 | 6,043 | |||||
Issuance of ordinary shares upon exercise of options (in shares) | 913,801 | |||||||
Issuance (use) of ordinary shares to (under) depository for exercise of options (in shares) | -13,801 | |||||||
Share-based compensation | 13,363 | 13,363 | ||||||
Appropriation to statutory reserves | 3,710 | -3,710 | 3,710 | |||||
Repurchase of ordinary shares | -63,702 | -63,702 | ||||||
Cancellation of treasury shares | -2 | -5,697 | 5,699 | |||||
Cancellation of treasury shares (in shares) | -258,450 | |||||||
Foreign currency translation adjustments | -772 | -772 | ||||||
Balance at Dec. 31, 2012 | 343 | 536,173 | -58,003 | 9,502 | 63,183 | -3,812 | 547,386 | |
Balance (in shares) at Dec. 31, 2012 | 48,130,944 | |||||||
Increase (Decrease) in Shareholders' Equity | ||||||||
Net income | 63,656 | 63,656 | ||||||
Issuance of ordinary shares upon exercise of options | 6 | 8,103 | 8,109 | |||||
Issuance of ordinary shares upon exercise of options (in shares) | 981,992 | |||||||
Dividend distribution to shareholders | -48,246 | -48,246 | ||||||
Issuance (use) of ordinary shares to (under) depository for exercise of options (in shares) | -81,992 | |||||||
Share-based compensation | 10,428 | 10,428 | ||||||
Appropriation to statutory reserves | 472 | -472 | 472 | |||||
Repurchase of ordinary shares | -33,097 | -33,097 | ||||||
Foreign currency translation adjustments | -9,018 | -9,018 | ||||||
Balance at Dec. 31, 2013 | 349 | 506,458 | -91,100 | 9,974 | 126,367 | -12,830 | 539,218 | |
Balance (in shares) at Dec. 31, 2013 | 49,030,944 | 49,030,944 | ||||||
Increase (Decrease) in Shareholders' Equity | ||||||||
Net income | 20,107 | 3,240 | 20,107 | |||||
Issuance of ordinary shares upon exercise of options | 5 | 8,699 | 8,704 | |||||
Issuance of ordinary shares upon exercise of options (in shares) | 647,269 | |||||||
Dividend distribution to shareholders | -165,951 | -165,951 | ||||||
Issuance (use) of ordinary shares to (under) depository for exercise of options (in shares) | 252,731 | |||||||
Share-based compensation | 9,562 | 9,562 | ||||||
Appropriation to statutory reserves | 129 | -129 | 129 | |||||
Repurchase of ordinary shares | -26,380 | -26,380 | ||||||
Foreign currency translation adjustments | 1,780 | 287 | 1,780 | |||||
Balance at Dec. 31, 2014 | 354 | 358,768 | -117,480 | 10,103 | 146,345 | -11,050 | $62,380 | 387,040 |
Balance (in shares) at Dec. 31, 2014 | 49,930,944 | 49,930,944 |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS | 12 Months Ended | |||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
USD ($) | CNY | CNY | CNY | |
Cash flows from operating activities | ||||
Net income | $3,240 | 20,107 | 63,656 | 58,937 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||||
Depreciation and amortization | 2,318 | 14,381 | 16,175 | 13,406 |
Share-based compensation | 1,541 | 9,562 | 10,428 | 13,363 |
Foreign currency exchange loss/(income), net | 219 | 1,361 | -1,935 | 1,845 |
Deferred taxation | -552 | -3,427 | 3,533 | 474 |
Loss from disposal of property, plant and equipment | 35 | 218 | 5 | 786 |
Dividend income from available-for-sale securities | -78 | -482 | -186 | -47 |
Changes in operating assets and liabilities: | ||||
Accounts receivable, net | -608 | -3,772 | 6,115 | -23,808 |
Prepaid expenses and other assets | -7,202 | -44,687 | 20,901 | -31,656 |
Deferred revenue | 10,196 | 63,260 | 15,187 | 32,026 |
Accounts payable | 2,429 | 15,071 | 4,458 | 59 |
Accrued expenses and other current liabilities | 1,417 | 8,795 | 18,887 | -5,359 |
Income tax payable | -514 | -3,189 | 9,743 | -2,341 |
Net cash provided by operating activities | 12,441 | 77,198 | 166,967 | 57,685 |
Cash flows from investing activities | ||||
Purchase of short-term deposits | -38,595 | -239,466 | -326,299 | -233,025 |
Maturity of short-term deposits | 54,202 | 336,299 | 233,025 | 404,500 |
Purchase of property, plant and equipment | -893 | -5,541 | -18,168 | -83,072 |
Purchase of intangible assets | -305 | |||
Consideration paid for a business combination | -4,500 | |||
Proceeds from disposal of property, plant and equipment | 2 | 14 | 57 | |
Purchase of available-for-sale securities | -1,612 | -10,000 | -5,000 | |
Investment in equity investee | -1,781 | -11,048 | ||
Net cash provided by/(used in) investing activities | 11,323 | 70,258 | -111,747 | 78,960 |
Cash flows from financing activities | ||||
Issuance of ordinary shares upon exercise of share options, net of issuance cost | 1,403 | 8,704 | 8,109 | 6,043 |
Payment of dividend to ordinary shareholders | -26,746 | -165,951 | -48,246 | |
Repurchase of ordinary shares | -4,252 | -26,380 | -33,097 | -63,702 |
Net cash used in financing activities | -29,595 | -183,627 | -73,234 | -57,659 |
Effect of exchange rate changes on cash and cash equivalents | 69 | 415 | -7,082 | -2,617 |
Net increase/(decrease) in cash and cash equivalents | -5,762 | -35,756 | -25,096 | 76,369 |
Cash and cash equivalents at beginning of year | 37,490 | 232,613 | 257,709 | 181,340 |
Cash and cash equivalents at end of year | 31,728 | 196,857 | 232,613 | 257,709 |
Supplemental disclosure of cash flow information | ||||
Income tax paid | ($1,551) | -9,623 | -1,115 | -11,094 |
Principal_Activities_and_Organ
Principal Activities and Organization | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Principal Activities and Organization | |||||||||
Principal Activities and Organization | |||||||||
1.Principal Activities and Organization | |||||||||
a)Principal activities | |||||||||
Jiayuan.com International Ltd. (“Jiayuan”, or the “Company”), through its subsidiaries, its variable interest entities (“VIEs”), and VIE’s subsidiary (collectively, the “Group”), is principally engaged in operating online dating services in the People’s Republic of China (the “PRC” or “China”) through its online dating platforms which can be accessed through the jiayuan.com, izhenxin.com, juedui100.com, imdali.com and qiuai.com websites, wireless application protocol (“WAP”) browsers and wireless applications. The Group also hosts events and performs personalized matchmaking services to help individuals find suitable partners. | |||||||||
b)Organization | |||||||||
The Company was incorporated in the Cayman Islands on September 29, 2010. | |||||||||
Prior to February 2007, the Group’s business was operated through its PRC domestic company, Shanghai Huaqianshu Information Technology Co., Ltd. (“Shanghai HQS”), which was directly or indirectly, owned or controlled by Ms. Haiyan Gong, Mr. Yongqiang Qian, Mr. Xu Liu, and Ms. Jing Yang (the “Founding Shareholders”). | |||||||||
In February 2007, the Founding Shareholders undertook a reorganization (the “Reorganization”) and established Harper Capital Inc., an investment holding company under the laws of the British Virgin Islands (the “BVI Company”). Subsequently, in May 2007, the BVI Company established Miyuan (Shanghai) Information Technology Co., Ltd. (“Shanghai Miyuan”) as a wholly-owned foreign enterprise in the PRC. The Reorganization was necessary to comply with PRC laws and regulations which prohibit or restrict foreign ownership of companies that provide Internet content services in the PRC where licenses are required. On January 26, 2011, the Company issued shares to the shareholders of BVI Company at an exchange ratio of one to one, or the Share Swap. After the Share Swap, BVI Company became a direct wholly-owned subsidiary. | |||||||||
By entering into a series of agreements among the Founding Shareholders, Shanghai HQS, Beijing Huaqianshu Information Technology Co., Ltd. (“Beijing HQS”), Beijing Shiji Xique Information Technology Co., Ltd. (“Xique”) and Shanghai Miyuan, Shanghai HQS, Beijing HQS and Xique became variable interest entities (“VIEs”) of Shanghai Miyuan and consequently, Shanghai Miyuan became the primary beneficiary of Shanghai HQS, Beijing HQS and Xique (see Note 2). | |||||||||
On May 16, 2011, the Company completed an initial public offering (“IPO”) of 6,700,000 American depositary shares (“ADSs”), representing 10,050,000 ordinary shares, in the NASDAQ Global Select Market. The net proceeds received by the Company from the IPO, after deducting commissions and offering expenses, amounted to approximately US$65,243. Upon the completion of the IPO, all of the Company’s then outstanding Series A redeemable convertible preferred shares (“Series A Preferred Shares”) were converted into the same number of ordinary shares. | |||||||||
On August 13, 2012, Beijing Miyuan Information Technology Co. Ltd. (“Beijing Miyuan”), a wholly owned foreign enterprise established by Jiayuan Hong Kong Corporation Limited (“Jiayuan Hong Kong”), entered into a series of contractual arrangements with Beijing Aizhenxin Information Technology Co., Ltd. (“Beijing Aizhenxin”), an entity incorporated in the PRC, and its legal shareholders to acquire effective control over Beijing Aizhenxin. As a result, Beijing Aizhenxin became a VIE of Beijing Miyuan. Beijing Miyuan became the primary beneficiary of Beijing Aizhenxin (see Note 2). | |||||||||
On March 1, 2014, Shanghai Miyuan, Beijing Miyuan, Shanghai HQS, Beijing HQS, Xique and their respective legal shareholders and Shiji Jiayuan Matchmaking Services Center (“Jiayuan Shanghai Center”), the subsidiary of Shanghai HQS, entered into assignment agreements whereby Shanghai Miyuan transferred its obligations and rights under the contractual arrangements with Shanghai HQS, Beijing HQS, Xique and their respective shareholders and Jiayuan Shanghai Center to Beijing Miyuan. In addition, Beijing Miyuan entered into contractual agreements with Shanghai HQS, Beijing HQS, Xique and their respective legal shareholders, and Jiayuan Shanghai Center on March 1, 2014 (see Note 2). | |||||||||
As of December 31, 2014, the Company’s subsidiaries, VIEs and VIE’s subsidiary included the following entities: | |||||||||
Name | Date of | Place of | Percentage of | Principal | |||||
incorporation or | incorporation | direct or | activities | ||||||
establishment | or establishment | indirect | |||||||
/operations | economic | ||||||||
ownership | |||||||||
Subsidiaries | |||||||||
Harper Capital Inc. (“BVI Company”) | February 6, 2007 | British Virgin Islands | 100 | % | Investment holding | ||||
Miyuan (Shanghai) Information Technology Co., Ltd. (“Shanghai Miyuan”) | April 27, 2007 | PRC | 100 | % | Investment holding and consulting services | ||||
Jiayuan Hong Kong Corporation Limited (“Jiayuan Hong Kong”) | October 5, 2010 | Hong Kong | 100 | % | Investment holding and overseas online dating services | ||||
Beijing Miyuan Information Technology Co., Ltd. (“Beijing Miyuan”) | January 26, 2011 | PRC | 100 | % | Investment holding and consulting services | ||||
Variable interest entities (“VIEs”) | |||||||||
Shanghai Huaqianshu Information Technology Co., Ltd. (“Shanghai HQS”) | April 6, 2004 | PRC | 100 | % | Online dating services | ||||
Beijing Huaqianshu Information Technology Co., Ltd. (“Beijing HQS”) | November 26, 2010 | PRC | 100 | % | Online dating services and personalized matchmaking services | ||||
Beijing Shiji Xique Information Technology Co., Ltd. (“Xique”) | November 26, 2010 | PRC | 100 | % | Online wedding planning services | ||||
Beijing Aizhenxin Information Technology Co., Ltd. (“Beijing Aizhenxin”) | August 13, 2012 | PRC | 100 | % | Online dating services | ||||
VIE’s subsidiary | |||||||||
Shiji Jiayuan Matchmaking Services Center (“Jiayuan Shanghai Center”) | December 3, 2010 | PRC | 100 | % | Events and personalized matchmaking services | ||||
Variable_Interest_Entities
Variable Interest Entities | 12 Months Ended |
Dec. 31, 2014 | |
Variable Interest Entities | |
Variable Interest Entities | |
2.Variable Interest Entities | |
To comply with PRC laws and regulations that prohibit or restrict foreign ownership of companies that provide Internet content services in the PRC, the Company provides its services through VIEs which hold the licenses and approvals to provide Internet content services in the PRC. The Company also provides certain personalized matchmaking services through Shanghai HQS, Beijing HQS and Jiayuan Shanghai Center which holds the licenses and approvals to provide personalized matchmaking services. The Company obtained substantial ability to control VIEs and VIE’s subsidiary through a series of contractual agreements entered into among Beijing Miyuan, VIEs and their respective legal shareholders and VIE’s subsidiary. | |
The Group adopted Financial Accounting Standard Board (the “FASB”) guidance on consolidating variable interest entities which require certain variable interest entities to be consolidated by the primary beneficiary of the entity. Management evaluated the relationships among Beijing Miyuan, VIEs and their legal shareholders, and VIE’s subsidiary, and concluded that Beijing Miyuan is the primary beneficiary of VIEs and VIE’s subsidiary as Beijing Miyuan is entitled to substantially all the economic risks and rewards of VIEs and VIE’s subsidiary, and has the power to direct the activities that most significantly impact the economic performance of VIEs and VIE’s subsidiary. As a result, VIEs’ and VIE’s subsidiary’s results of operations, assets and liabilities have been included in the Group’s consolidated financial statements. | |
The assignment agreements and contractual agreements entered into on March 1, 2014 were accounted for as reorganizations of businesses under common control in a manner similar to a pooling of interests. Accordingly, the Group continued to include the financial statements of VIEs and VIE’s subsidiary in its consolidated financial statements after the transfer. | |
The following is a summary of the contractual agreements entered into among Beijing Miyuan, VIEs and their respective legal shareholders, and VIE’s subsidiary. The contractual agreements among Beijing Miyuan and Shanghai HQS, Beijing HQS, Xique and their respective legal shareholders and Jiayuan Shanghai Center are substantially the same as those contractual agreements among Shanghai Miyuan and Shanghai HQS, Beijing HQS, Xique and their respective legal shareholders, and Jiayuan Shanghai Center before the transfer on March 1, 2014. (Note 2(a)). | |
(a)Contractual arrangements among Beijing Miyuan, its respective VIEs, VIE’s subsidiary and their legal shareholders | |
Exclusive technology license and service agreements | |
Pursuant to the exclusive technology license and service agreement entered into on August 13, 2012 between Beijing Miyuan and Beijing Aizhenxin and the amended and restated exclusive technology license and service agreement entered into on March 1, 2014 among Beijing Miyuan, Shanghai HQS, Jiayuan Shanghai Center, Beijing HQS and Xique, Shanghai HQS, Jiayuan Shanghai Center, Beijing HQS, Xique and Beijing Aizhenxin retain Beijing Miyuan as their exclusive provider of software and hardware licenses, technology support, hardware and data maintenance and updates, software development, maintenance and updates, professional training, information collection and research, technology consulting services related to the business operations of Shanghai HQS, Jiayuan Shanghai Center, Beijing HQS, Xique and Beijing Aizhenxin. As consideration for such services, Shanghai HQS, Jiayuan Shanghai Center, Beijing HQS, Xique and Beijing Aizhenxin agreed to pay service fees equal to a certain percentage of their annual revenues as agreed by the parties from time to time. The aforementioned exclusive technology license and service agreements between Beijing Miyuan and Shanghai HQS, Beijing Miyuan and Beijing HQS, Beijing Miyuan and Xique, Beijing Miyuan and Beijing Aizhenxin, Beijing Miyuan and Jiayuan Shanghai Center will expire on January 24, 2021, February 16, 2021, February 16, 2021, August 12, 2022 and January 24, 2021, respectively; and, except by mutual agreement upon early termination by the parties in writing, the term of these agreements will be automatically extended for ten years. | |
Loan agreements | |
Pursuant to the loan agreement entered into on August 13, 2012 between Beijing Miyuan and the legal shareholders of Beijing Aizhenxin and the amended and restated relevant loan agreements entered into on March 1, 2014 between Beijing Miyuan and the legal shareholders of Shanghai HQS, Beijing HQS and Xique, respectively, Beijing Miyuan have granted interest-free loans of US$1,200 and RMB9,000, RMB1,000, RMB1,000 and RMB20,000 to legal shareholders of Shanghai HQS, Beijing HQS, Xique and Beijing Aizhenxin, respectively, which shall only be used for Shanghai HQS, Beijing HQS, Xique and Beijing Aizhenxin’s working capital. The loans are repayable on demand. If the respective legal shareholders intend to voluntarily repay the loans in whole or in part, or if Beijing Miyuan requires the shareholders to repay the loans in whole or in part, Beijing Miyuan or its designee may acquire a proportionate amount of the equity interests of Shanghai HQS, Beijing HQS, Xique and Beijing Aizhenxin from their shareholders for a purchase price equal to the principal amount of the repaid loans. The loans have been eliminated upon the consolidation of Shanghai HQS, Beijing HQS, Xique and Beijing Aizhenxin. | |
Exclusive purchase option agreements | |
Pursuant to the exclusive purchase option agreement entered into on August 13, 2012 among Beijing Miyuan, Beijing Aizhenxin and its legal shareholders and the amended and restated exclusive purchase option agreements entered into on March 1, 2014 among Shanghai HQS, Beijing HQS, Xique, their respective legal shareholders and Beijing Miyuan, Beijing Miyuan has an exclusive option to purchase, or designate another qualified individual or entity to purchase, to the extent permitted by PRC law, part or all of the equity interests in Shanghai HQS, Beijing HQS, Xique and Beijing Aizhenxin owned by their shareholders. The purchase prices for the entire equity interest of Shanghai HQS, Beijing HQS, Xique and Beijing Aizhenxin shall be the proportionate amount of the registered capital owned by such shareholders or an amount agreed by the parties in writing, provided that, in case of any compulsory requirement by then PRC law, the purchase prices shall be the minimum prices permitted by applicable PRC law. The exclusive equity transfer option agreements remain in effect until the completion of the transfer of all the shares in accordance with the agreements. | |
Voting rights entrustment agreements | |
Pursuant to the voting right entrustment agreement entered into on August 13, 2012 among Beijing Miyuan, Beijing Aizhenxin and its legal shareholders and the amended and restated voting rights entrustment agreements entered into on March 1, 2014 among Shanghai HQS, Beijing HQS, Xique, their respective legal shareholders and Beijing Miyuan, the legal shareholders of Shanghai HQS, Beijing HQS, Xique and Beijing Aizhenxin grant Beijing Miyuan or its designated qualified individual or entity the right to exercise all the voting rights as provided under their then articles of association. The voting rights entrustment agreements will remain effective until January 24, 2021, February 16, 2021, February 16, 2021 and August 12, 2022, respectively. Except for mutual agreement on early termination by both parties in writing or any termination arising from Shanghai HQS, Beijing HQS, Xique, Beijing Aizhenxin or the nominee shareholders’ material breach of obligations thereunder, the term of the voting rights entrustment agreement will be automatically extended for ten years. | |
Equity pledge agreements | |
Pursuant to the equity pledge agreement entered into on August 13, 2012 between Beijing Miyuan and the legal shareholders of Beijing Aizhenxin and the amended and restated equity pledge agreements entered into on March 1, 2014 between Beijing Miyuan and their respective legal shareholders of Shanghai HQS, Beijing HQS and Xique, the legal shareholders of Shanghai HQS, Beijing HQS, Xique and Beijing Aizhenxin pledge all of their respective equity interests in Shanghai HQS, Beijing HQS, Xique and Beijing Aizhenxin to Beijing Miyuan to secure their obligations under the exclusive technology license and service agreements, the loan agreements, the exclusive equity transfer option agreements and the voting rights entrustment agreement, each as described above. The equity pledge agreements will expire when Shanghai HQS, Beijing HQS, Xique, Beijing Aizhenxin and their shareholders have fully performed their obligations under the agreements described above. | |
Cooperative Operation Agreement | |
Pursuant to the amended and restated cooperative operation agreement entered into on March 1, 2014 among Beijing Miyuan, Shanghai HQS and Jiayuan Shanghai Center, in order to ensure Jiayuan Shanghai Center’s ability to make payments to Beijing Miyuan under the amended and restated exclusive technology license and service agreement between Jiayuan Shanghai Center and Beijing Miyuan, Shanghai HQS agrees to appoint designees of Beijing Miyuan as the members of the management committee and the key employees of Jiayuan Shanghai Center upon the request of Beijing Miyuan. This agreement will expire on January 24, 2021 and, unless terminated early by Beijing Miyuan, the term will be automatically extended for ten years. | |
Under 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 the registered capital of the VIEs amounting to a total of RMB32,500 as of December 31, 2014. 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. | |
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 potential loss. | |
Please refer to Note 4(a) for the risks relating to the VIE arrangements and the impact of the VIEs on the Company’s financial performance. | |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 12 Months Ended | ||
Dec. 31, 2014 | |||
Summary of Significant Accounting Policies | |||
Summary of Significant Accounting Policies | 3.Summary of Significant Accounting Policies | ||
a)Basis of presentation and consolidation | |||
The Group’s consolidated financial statements include the financial statements of the Company, its subsidiaries and its VIEs for which the Company is the primary beneficiary. All transactions and balances among the Company, its subsidiaries and its VIEs have been eliminated upon consolidation. The consolidated financial statements have been prepared on a historical cost basis to reflect the financial position and results of operations of the Group in accordance with accounting principles generally accepted in the United States of America (“US GAAP”). | |||
A subsidiary is an entity in which the Company, directly or indirectly, controls more than one half of the voting powers, or has the power to govern the financial and operating policies, to appoint or remove the majority of the members of the board of directors, or to cast a majority of votes at the meeting of directors. | |||
A VIE is an entity in which the Company, or its subsidiary, through contractual agreements, has controlling financial interest of the entity. The Company or its subsidiary is considered to be the primary beneficiary if the Company or its subsidiary has the power to direct the activities that most significantly impact the VIEs’ economic performance and the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. | |||
In determining whether the Company or its subsidiaries are the primary beneficiary of the VIEs, the Company considered whether it has the power to direct activities that are significant to Shanghai HQS, Beijing HQS, Xique, Beijing Aizhenxin and Jiayuan Shanghai Center’s economic performance, including the power to appoint senior management, right to direct company strategy, power to approve capital expenditure budgets, and power to establish and manage ordinary business operation procedures and internal regulations and systems. | |||
There are no entities where the Company has a variable interest but is not the primary beneficiary. | |||
b)Use of estimates | |||
The preparation of the consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amount of the assets, liabilities, revenues and expenses, and the related disclosure of contingent assets and liabilities. Actual results may differ from those estimates. | |||
Significant accounting estimates reflected in the Group’s consolidated financial statements mainly include the useful lives of property and equipment and intangible assets, impairment assessments for property and equipment, intangible assets, goodwill, investment in equity investee, allowance for doubtful accounts, valuation allowance of deferred tax assets, relative values of revenue elements of service packages, estimation of payments collected by wireless value-added services (“WVAS”) partners and determination of share-based compensation expenses. In addition, the Group uses assumptions in the valuation model to estimate the fair value of share options granted and modified. The Group bases its estimates of the carrying value of certain assets and liabilities on the historical experience and on other various factors that it believes to be reasonable under the circumstances, when the carrying values are not readily available from other sources. | |||
c)Convenience translation | |||
Translations of balances in the consolidated balance sheets, consolidated statements of comprehensive income and consolidated statements of cash flows from Renminbi (“RMB”) into United States dollars (“US$”) as of and for the year ended December 31, 2014 are solely for the convenience of the reader and were calculated at the rate of US$1.00 =MB6.2046, representing the rate as certified by the H.10 weekly statistical release of Federal Reserve Board on December 31, 2014. No representation is made that the RMB amounts could have been, or could be, converted, realized or settled into US$ at that rate on December 31, 2014, or at any other rate. | |||
d)Cash and cash equivalents | |||
Cash and cash equivalents represent cash on hand, demand deposits and highly liquid investments placed with banks, which have original maturities of three months or less and are readily convertible to known amounts of cash. | |||
e)Term deposits | |||
Term deposits represent time deposits placed with banks. Deposits with original maturities of one year or less are reported as current assets while deposits with original maturities of more than one year are reported as non-current assets. Interest earned is recorded as interest income in the consolidated statements of comprehensive income during the periods presented. | |||
f)Available-for-sale securities | |||
Investments in financial instruments with variable interest rates indexed to the performance of underlying assets are classified as available-for-sale securities. Available-for-sale securities are measured at fair value at the date of initial recognition and subsequently carried at fair value. To estimate fair value, the Group refers to the quoted rate of return provided by banks at the end of each reporting period. Changes in fair value are reflected in the consolidated statement of comprehensive income. Dividend and realized gains and losses upon sale of the available-for-sale securities are recognized as other income. | |||
g)Accounts receivable and allowance for doubtful accounts | |||
Accounts receivable mainly represents the amounts due from WVAS partners with whom the Group has entered into agreements for users to purchase the services of the Group and amounts due from offline events sponsors. An allowance for doubtful debts is provided based on an ageing analysis of accounts receivable balances, historical bad debt rates, repayment patterns and credit analysis. The Group also makes a specific allowance if there is evidence showing that the receivable is likely to be irrecoverable, and assesses the probability of recovery on an annual basis. Accounts receivable in the consolidated balance sheet were stated net of such provisions. The allowance for doubtful accounts was RMB110, RMBnil and RMB1,130 for the year ended December 31, 2012, 2013 and 2014, respectively. | |||
h)Property and equipment | |||
Property and equipment is stated at cost less accumulated depreciation and impairment. Depreciation is provided on a straight-line basis over the following estimated useful lives: | |||
Estimated useful lives | |||
Office building | 30 years | ||
Office building improvements | 10 years | ||
Computer and software | 3 years | ||
Furniture, fixture and other equipment | 3 years | ||
Motor vehicles | 4 years | ||
Leasehold improvements | Shorter of lease term or estimated useful lives of assets | ||
Repairs and maintenance expenditures, which are not considered improvements and do not extend the useful life of the property and equipment, are expensed as incurred. Gains and losses from the disposal of property and equipment are included in income from operations. | |||
i)Goodwill | |||
Goodwill represents the excess of the purchase price over the fair value of the identifiable assets and liabilities acquired as a result of the Group’s business combinations. | |||
In accordance with FASB guidance for goodwill and other intangible assets, goodwill is not amortized but is tested for impairment on an annual basis, or more frequently if events or changes in circumstances indicate that it might be impaired. The Group completes a two-step goodwill impairment test at each year end date. The first step compares the fair values of each reporting unit to its carrying amount, including goodwill. If the fair value of each reporting unit exceeds its carrying amount, goodwill is not considered to be impaired and the second step will not be required. If the carrying amount of a reporting unit exceeds its fair value, the second step compares the implied fair value of goodwill to the carrying value of a reporting unit’s goodwill. The implied fair value of goodwill is determined in a manner similar to accounting for a business combination with the allocation of the assessed fair value reporting unit over the amount assigned to the assets and liabilities. This allocation process is only performed for the purposes of evaluating goodwill impairment and does not result in an entry to adjust the value of any assets or liabilities. An impairment loss is recognized for any excess in the carrying value over the implied fair value of goodwill. | |||
The Group did not incur any impairment loss on goodwill during any of the periods presented. | |||
j)Intangible assets | |||
Intangible assets consist of acquired intangible assets with finite lives as a result of the Group’s business combination and the acquired domain names, and are carried at cost less accumulated amortization. Amortization is computed using the straight-line method over the following estimated useful lives of the intangible assets: | |||
Estimated useful lives | |||
Trademarks and domain names | 10 years | ||
Customer relationships | 5 years | ||
Source code | 10 years | ||
k)Impairment of long-lived assets and intangible assets | |||
The carrying amount of long-lived assets and intangible assets are reviewed for impairment whenever events or changes in the circumstances indicate that the carrying value of an asset may not be recoverable. The Group assesses the recoverability of the long-lived assets and intangible assets by comparing the carrying amount of assets to the estimated future undiscounted cash flows expected to be generated by the assets. Such assets are considered to be impaired if the sum of the expected undiscounted cash flow is less than the carrying amount of the assets. The impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. No impairment of long-lived assets or intangible assets was recognized for any of the periods presented. | |||
l)Investment in equity investee | |||
Equity investment represents the Group’s investment in a private-owned company. For any equity investment that is not considered as debt security or equity security and that neither has readily determinable fair values nor is considered in-substance common stock, the cost method is used. | |||
Under the cost method, the Group carries the investment at cost and recognizes income to the extent of dividends received from the distribution of the equity investee’s post-acquisition profits. | |||
The Group continually reviews its investment in equity investee to determine whether a decline in fair value below the carrying value is other than temporary. The primary factors the Group considers in its determination are the length of time that the fair value of the investment is below the Group’s carrying value; the financial condition, operating performance and the prospects of the equity investee; and other company specific information such as recent financing rounds. If the decline in fair value is deemed to be other than temporary, the carrying value of the equity investee is written down to fair value. No impairment of investment in equity investee was recognized for the year ended December 31, 2014. | |||
m)Revenue recognition and deferred revenue | |||
Revenue is recognized when persuasive evidence of an arrangement exists, service has been rendered, the price is fixed or determinable and collection is reasonably assured. Revenue is deferred until these criteria are met as described below. | |||
Revenues presented in the consolidated statement of comprehensive income include revenues from online services, personalized matchmaking services, and events and other services. | |||
Online services revenue | |||
The Group offers two types of online services through its online platforms, including message exchanging services and value-added services. Users prepay for virtual currencies that can be used as consideration for the Group’s online services. The Group charges for message exchanging services when one registered user initiates contact with another registered user via the Group’s online platform, and either the sender or recipient may pay for the service. Subsequently, the Group does not charge for any message exchanges between the same two users. Based on the Group’s historical data, the exchange between two users on its online platform typically lasted only a few days. The Group believes that users place the most value on the initial connection, and that users are interested in further interactions after exchanging personal contact information to communicate with each other directly. The Group also offers value-added online services, including sending virtual gifts, improved search rankings and online chatting. | |||
The Group has adopted two primary fee models for the online services: a pay-per-use model and a periodic subscription model. Online services offered under the pay-per-use model include improved search rankings for the duration of one day, message sending or receiving and sending virtual gifts. As the Group provides these services within a short period of time, revenue is recognized when the virtual currencies are used and services are rendered. If the communication patterns of the users change, the timing of the Group’s revenue recognition for these services may be impacted and revenue may be deferred and recognized over a longer period. The Group’s virtual currencies purchased by users that have yet to be used are initially recorded as deferred revenue. | |||
Under the periodic subscription model, users pay a fixed subscription fee for certain services which are delivered over a predetermined subscription period. Online services offered under the subscription model include sending multiple messages a day, reading unlimited number of messages, improved search rankings for a period longer than a day, unlimited online chatting and premium user subscriptions. Fees for subscription services are collected upfront and initially recognized as deferred revenue, and revenue is recognized proportionately over the applicable subscription periods as services are rendered. | |||
The Group’s virtual currencies can be purchased through the Group’s online platform, where the payment is collected through online payment platforms, or through the Group’s WVAS partners. The Group’s WVAS partners offer a payment method by charging services to the customer’s telephone bills, collecting payment from the users and remitting the cash to the Group after payment is collected. Due to the time lag between when the services are rendered and billing statements are provided by the WVAS partners, revenues from the Group’s virtual currencies sold through such channel is estimated based on the Group’s internal billing records and billing confirmations with the WVAS partners. The Group adjusts its revenue recognition for prior periods’ confirmation rates and prior periods’ discrepancies between internally estimated revenues and actual revenues confirmed by the WVAS partners. There were no significant difference between the Group’s estimates and the WVAS partners’ billing statements for all the periods presented. | |||
Revenue from virtual currencies sold through the WVAS partners are recognized on a gross basis as the Group is considered the primary obligor in the arrangements. The Group is also responsible for designing, developing and implementing the online services, and bears credit risks associated with uncollectible fees. In addition, the Group determines the price and the WVAS partners earn only a fixed percentage of commission fees. The amounts attributed to the WVAS partners are determined pursuant to the arrangements between the Group and the WVAS partners, and are recognized as costs of revenues. Such cost of revenues amounted to RMB49,923, RMB61,881 and RMB65,997 for the years ended December 31, 2012, 2013 and 2014, respectively. | |||
The Group also offers web-based games and mobile games under an item-based revenue model, where the basic game play functions are free of charge and players are charged for purchases of in-game virtual items or game points. Revenues of games business are included in online service revenue. | |||
For web-based games, the Group cooperates with third-party game developers by entering into cooperation agreements with them. The web-based games designed, developed and hosted by these developers are made available to the players through the Group’s platforms. The Group views that the developers are primarily responsible for the operation of web-based games to the players. The Group generally collects payments from players in connection with the sale of in-game virtual items and remits certain agreed-upon percentages of the proceeds to the game developers and records revenue net of such remittances. Revenue is recognized when the in-game virtual items are consumed. | |||
For mobile games, the Group is primarily responsible for the operation and sells game points to players through third party mobile application stores. The mobile application stores remit the proceeds to the Group after deducting certain agreed-upon percentages of commission fees. Revenue from the sale of game points is recorded gross of the commission fees paid to mobile application stores and is recognized when the game points are consumed. | |||
Personalized matchmaking services revenue | |||
The Group provides personalized matchmaking services to individual users, which generally consist of unlimited access to certain online services, tickets to a number of events, personalized communications, provision of detailed background checks, dating and relationship consultation and advice and search services provided by the Group’s customer service representatives in a specified contractual period. The Group provides various personalized matchmaking services throughout the contract period on an as-needed basis. When the Group enters into a personalized matchmaking service contract with an individual user, the Group is unable to determine or estimate the volume of each separate service to be provided to the particular user. Different types of services under such personalized bundled contracts are to be provided gradually over the contract period, and as such, the Group accounts for the personalized matchmaking services as a single unit of accounting on a contract basis. Starting from 2013, the Group entered into business arrangements with matchmaking service agencies for providing personalized matchmaking services in the PRC. The Group grants matchmaking service agencies limited rights to use the Group’s brand, trademark and certain resources under the direction of the Group in accordance with the agency agreements. The Group collects upfront payments from the users and remits the commission fees to the matchmaking service agencies at the pre-determined rates pursuant to the agreements between the Group and the matchmaking service agencies. The Group is responsible for the determination of the service scope and price, and the signing of the service agreements and the collection of service fees from customers directly. Revenue from users obtained through matchmaking service agencies are recognized on a gross basis as the Group is considered the primary obligor in the service arrangements. | |||
Payments for personalized matchmaking services are collected upfront and initially recorded as deferred revenue, and revenue is recognized ratably over the contract service period. In addition, there are training fees charged upfront to the matchmaking service agencies, which are recognized as revenue when the training services are rendered. | |||
Contracts for personalized matchmaking services may be terminated at any time at the user’s sole discretion during the contractual period. It is the Group’s policy to refund 80% of the contract payment to the user only if termination takes place within the initial seven days. The Group recognizes all deferred revenue remaining, after deducting the cash refund, if any, from the contract at the time of termination. | |||
Events and other services revenue | |||
The Group earns revenue from organizing and hosting events, including speed-dating, dance parties, and other social events for its users. Speed dating is an organized form of matchmaking that focuses on meeting multiple potential romantic partners over the course of a single event. Tickets are generally sold at the events, and revenue is recognized upon the conclusion of the events when services have been rendered. For certain events where tickets are prepaid by the users, prepaid fees are initially recorded as deferred revenue and revenue is recognized upon the completion of the events. Events services revenue also include the revenue from event sponsorship arrangements whereby third-party companies enter into agreements with the Group to sponsor a particular offline event and the revenue from event sponsorship arrangements are recognized upon the completion of the sponsored event. | |||
Other services revenue mainly represents revenues from online advertising. Revenue from online advertising is principally derived from advertising arrangements that allow advertisers to place advertisements on particular areas of the Group’s websites, in particular formats and over a particular period of time. The Group enters into advertising contracts which are signed to establish the fixed price for the advertising arrangements to be provided, and payment is collected upfront and initially recognized as deferred revenue. Revenues from advertising-related arrangements are recognized on a straight-line basis over the contractual period. | |||
n)Customer loyalty program | |||
Registered users earned loyalty points based on their activities on the Group’s platform and/or purchase of online services, which could be used to redeem online services once a minimum number of points had been accumulated. The Group considered loyalty points awarded for the purchase of online services to be part of its revenue generating activities, and such arrangements were considered to have multiple elements. Under the applicable guidance, total consideration was allocated to the purchased services and loyalty points based on the relative selling price of the purchased services and redeemable services. In determining the best estimated selling price of each loyalty point, the Group considered the selling price of the underlying services if they were not redeemed using loyalty points and the average number of loyalty points needed to redeem each type of service. Consideration allocated to the loyalty points was initially recorded as deferred revenue, and revenue was recognized when the points were redeemed and services were rendered. In 2013, the Group suspended the customer loyalty program. All the loyalty points expired in 2013 and the Group recognized the deferred revenue accordingly. | |||
For the years ended December 31, 2012, 2013 and 2014, revenue recognized from loyalty points amounted to RMBnil, RMB4,917 and RMBnil, respectively. All the loyalty points expired in 2013 and the deferred revenue balance in relation to the customer loyalty program amounted to RMBnil as of December 31, 2013 and thereafter. | |||
o)Cost of revenues | |||
Cost of revenues primarily consists of commission fees paid to the WVAS partners for money collection, salaries and wages, network costs, depreciation of property and equipment, rental expenses of premises and facilities and commission fees paid to personalized matchmaking service agencies. | |||
p)Share-based compensation | |||
The Company grants share options and restricted shares to eligible employees and directors under a share incentive plan. The awards are measured at the grant date fair value and are recognized as an expense using the graded vesting method, net of estimated forfeiture rate. The Company recognizes awards with service condition terms only over the requisite service period, which is generally the vesting period. | |||
q)Income taxes | |||
Income taxes are accounted for under the asset and liability method. Deferred income taxes are accounted for using an asset and liability approach which requires the recognition of income taxes payable or refundable for the current year. Deferred tax liabilities and assets for the future tax consequences of events are also recognized in the Group’s financial statements or tax returns. | |||
Deferred income taxes are determined based on the differences between the financial reporting and tax basis of assets and liabilities and are measured using the currently enacted tax rates and laws. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the consolidated statements of comprehensive income in the period that includes the enactment date. A valuation allowance is provided to reduce the carrying amount of deferred tax assets if it is considered more likely than not that some portion, or all, of the deferred tax assets will not be realized. | |||
The PRC tax regulations impose a 10% withholding income tax for dividends distributed by foreign invested enterprises to their immediate holding companies outside the PRC. 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. A holding company in Hong Kong, for example, will be subject to a 5% withholding tax rate under the Arrangement Between the PRC and Hong Kong on the Avoidance of Double Taxation and Prevention of Fiscal Evasion with Respect to Taxes on Income and Capital if such holding company is considered a non-PRC resident enterprise and holds at least 25% of the equity interests in the PRC foreign invested enterprise distributing the dividends, subject to approval of the PRC local tax authority. However, if the Hong Kong holding company is not considered to be the beneficial owner of such dividends under applicable PRC tax regulations, such dividend will remain subject to a withholding tax rate of 10%. | |||
The guidance on accounting for uncertainties in income taxes 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. Guidance was also provided 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. Significant judgment is required in evaluating the Group’s uncertain tax positions and determining its provision for income taxes. The Group recognizes interests and penalties, if any, under accrued expenses and other current liabilities on its balance sheet and under other expenses in its statement of comprehensive income. The Group did not recognize any significant interest and penalties associated with uncertain tax positions for the years ended December 31, 2012, 2013 and 2014. As of December 31, 2014, the Group did not have any significant unrecognized uncertain tax positions. | |||
r)Employee benefit expenses | |||
All eligible employees of the Group are entitled to staff welfare benefits including medical care, welfare subsidies, unemployment insurance and pension benefits through a PRC government-mandated multi-employer defined contribution plan. The Group is required to accrue for these benefits based on certain percentages of the qualified employees’ salaries. The Group is required to make contributions to the plans out of the amounts accrued. The PRC government is responsible for the medical benefits and the pension liability to be paid to these employees and the Group’s obligations are limited to the amounts contributed. The Group has no further payment obligations once the contributions have been paid. | |||
The Group recorded employee benefit expenses of RMB14,005, RMB17,568 and RMB20,553 for the years ended December 31, 2012 and 2013 and 2014, respectively. | |||
s)Statutory reserves | |||
The Group’s subsidiaries, VIEs and VIE’s subsidiary established in the PRC are required to make appropriations to certain non-distributable reserve funds. | |||
In accordance with the laws applicable to China’s Foreign Investment Enterprises, the Group’s subsidiaries registered as wholly-owned foreign enterprise has to make appropriations from its after-tax profit (as determined under the Accounting Standards for Business Enterprises as promulgated by the Ministry of Finance of the People’s Republic of China (“PRC GAAP”)) to reserve funds including general reserve fund, and staff bonus and welfare fund. | |||
The appropriation to the general reserve fund must be at least 10% of the after-tax profits calculated in accordance with PRC GAAP. Appropriation is not required if the reserve fund has reached 50% of the registered capital of the company. Appropriation to the staff bonus and welfare fund is at the company’s discretion. | |||
In addition, in accordance with the China Company Laws, the VIEs of the Company registered as a PRC domestic company must make appropriations from its after-tax profit as determined under the PRC GAAP to non-distributable reserve funds including a statutory surplus fund and a discretionary surplus fund. The appropriation to the statutory surplus fund must be at least 10% of the after-tax profits as determined under PRC GAAP. Appropriation is not required if the surplus fund has reached 50% of the registered capital of the company. Appropriation to the discretionary surplus fund is made at the discretion of the company. | |||
The use of the general reserve fund, statutory surplus fund and discretionary surplus fund are restricted to the offsetting of losses or increases the registered capital of the respective company. The staff bonus and welfare fund is a liability in nature and is restricted to fund payments of special bonus to staff and for the collective welfare of employees. All these reserves are not allowed to be transferred to the Company in terms of cash dividends, loans or advances, nor can they be distributed except under liquidation. | |||
For the years ended December 31, 2012, 2013 and 2014, RMB3,710, RMB472 and RMB129 were appropriated to the statutory reserves, respectively. | |||
t)Research and development costs | |||
Research and development costs include expenses incurred by the Company to develop, maintain and manage the Company’s platforms. These expenses are mainly comprised of salaries, employee benefits and other headcount-related costs associated with the research and development department. The Company expenses all costs that are incurred in connection with the planning and implementation phases of development and costs that are associated with repair and maintenance of the existing platforms. Costs incurred in the development phase are capitalized and amortized over the estimated product life. | |||
During the periods presented, the amount of costs qualifying for capitalization was not significant and as a result, the Group expensed all research and development costs as incurred. | |||
u)Advertising expenses | |||
Advertising expenses, which generally reflect the cost of promotions to create or stimulate a positive image of the Group or a desire to obtain the Group’s services, are expensed as incurred. Advertising costs included in selling and marketing expense were RMB69,966, RMB71,498 and RMB105,636 for the years ended December 31, 2012, 2013 and 2014, respectively. | |||
v)Operating lease | |||
Leases where substantially all the risks and rewards of ownership of the assets remain with the lessor are accounted for as operating leases. Payments made under operating leases are charged to the consolidated statements of comprehensive income on a straight line basis over the lease periods. | |||
w)Government subsidies | |||
Government subsidies represent discretionary cash subsidies granted by the local government to encourage the development of certain enterprises that are established in the local economic region. The cash subsidies are recognized as other income when there is reasonable assurance that the grant will be received and the Group will comply with all attached conditions. | |||
x)Foreign currency translation | |||
The Group uses the RMB as its reporting currency. The functional currency of the Company and its subsidiaries incorporated in the British Virgin Islands and Hong Kong is the US$, while the functional currency of the Group’s other subsidiaries, VIEs and VIE’s subsidiary incorporated and operated in the PRC is the RMB. | |||
In the consolidated financial statements, the financial information of the Company and its subsidiaries which use US$ as their functional currency, has been translated into RMB. Assets and liabilities are translated from each subsidiary’s functional currency at the exchange rates on the balance sheet date, equity amounts are translated at historical exchange rates, and revenues, expenses, gains, and losses are translated using the average rate for the year. Gains and losses resulting from foreign currency translation to reporting currency are recorded in accumulated other comprehensive income in the consolidated statements of comprehensive income for the years presented. | |||
y)Net income per share and per American Depository Share (“ADS”) | |||
Basic net income per share is computed by dividing net income by the weighted average number of ordinary shares outstanding during the year. Diluted net income per share is calculated by dividing net income attributable to ordinary 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. Ordinary equivalent shares consist of non-vested restricted shares and shares issuable upon the exercise of stock options (using the treasury stock method). Ordinary equivalent shares are not included in the denominator of the diluted net income per share calculation when inclusion of such shares would be anti-dilutive. | |||
Basic and diluted net income per ADS is computed based on net income and the corresponding basic and diluted number of ADSs, assuming that, during each period presented, every two ADSs represent three ordinary shares of the Company. | |||
z)Comprehensive income | |||
Comprehensive income is defined as the change in equity of a company during a period from transactions and other events and circumstances excluding those resulting from investments by shareholders and distributions to shareholders. Accumulated other comprehensive income, as presented on the accompanying consolidated balance sheets, consists of the accumulated foreign currency translation adjustments. | |||
aa)Recent accounting pronouncements | |||
On May 28, 2014, the FASB and IASB issued their converged standard on the recognition of revenue from contracts with customers. The standard is intended to improve the financial reporting of revenue and improve comparability of the top line in financial statements globally. The FASB is amending the FASB Accounting Standards Codification and creating a new Topic 606, Revenue from Contracts with Customers, to supersede the revenue recognition requirements in Topic 605, Revenue Recognition, and most industry-specific guidance throughout the Industry Topics of the Codification. Additionally, the amendments supersede some cost guidance included in Subtopic 605-35, Revenue Recognition—Construction-Type and Production-Type Contracts. For a public entity, the amendments are effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. Early application is not permitted. The Group is currently evaluating the impact on its consolidated financial statements of adopting this guidance. | |||
In June 2014, under ASC 718, Compensation—Stock Compensation, the FASB issued Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period. These amendments apply to all reporting entities that grant their employees share-based payments in which the terms of the award provide that a performance target that affects vesting could be achieved after the requisite service period. That is the case when an employee is eligible to retire or otherwise terminate employment before the end of the period in which a performance target could be achieved and still be eligible to vest in the award if and when the performance target is achieved. For all entities, the amendments are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. The Group is currently evaluating the impact on its consolidated financial statements of adopting this guidance. | |||
In August 2014, the FASB issued Presentation of Financial Statements — Going Concern. This standard requires management to evaluate for each annual and interim reporting period whether it is probable that the reporting entity will not be able to meet its obligations as they become due within one year after the date that the financial statements are issued. If the entity is in such a position, the standard provides for certain disclosures depending on whether or not the entity will be able to successfully mitigate its going concern status. This guidance is effective for annual periods ending after December 15, 2016 and interim periods within annual periods beginning after December 15, 2016. Early application is permitted. The Group does not anticipate that this adoption will have a significant impact on its financial position, results of operations, or cash flows. | |||
Concentration_Credit_and_Other
Concentration, Credit and Other Risks | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Concentration, Credit and Other Risks | ||||||||
Concentration, Credit and Other Risks | ||||||||
4.Concentration, Credit and Other Risks | ||||||||
a)PRC Regulations | ||||||||
The PRC market in which the Group operates poses certain macro-economic and regulatory risks and uncertainties. These uncertainties extend to the ability of the Group to conduct online services through contractual arrangements in the PRC since the industry remains highly regulated. The Group conducts all of its operations in China through its VIEs and VIE’s subsidiary, which the Group consolidates as a result of a series of contractual arrangements enacted among Beijing Miyuan, the VIEs and their legal shareholders. The Group believes that the contractual arrangements among Beijing Miyuan, the VIEs and their legal shareholders are in compliance with PRC law and are legally enforceable. If the VIEs or their legal shareholders fail to perform their obligations under the contractual arrangements or any dispute relating to these contracts remains unresolved, the Group will have to enforce its rights under these contracts through the operations of PRC law and courts. However, uncertainties in the PRC legal system could limit the Group’s ability to enforce these contractual arrangements. In particular, the interpretation and enforcement of these laws, rules and regulations involve uncertainties. If the Group had direct ownership of the VIEs, it would be able to exercise its rights as a shareholder to effect changes in the board of directors of the VIEs, which in turn could effect changes at the management level, subject to any applicable fiduciary obligations. However, under the current contractual arrangements, the Group relies on the VIEs and their legal shareholders’ performance of their contractual obligations to exercise effective control. In addition, the exclusive technology licenses and service agreements with the VIEs and VIE’s subsidiary, which first expire on the tenth anniversary of the agreement signing date, is subject to subsidiaries’ unilateral termination right. In general, neither the VIEs nor their legal shareholders may terminate the contracts prior to the expiration date. | ||||||||
Although the PRC has, since 1978, implemented a wide range of market-oriented economic reforms, continued reforms and progress towards a full market-oriented economy are uncertain. In addition, the telecommunications, information and media industries remain highly regulated. Restrictions are currently in place and are unclear with respect to which segments of these industries foreign owned entities, like the Company, may operate. The PRC government may issue from time to time new laws or new interpretations on existing laws to regulate areas such as telecommunications, information and media, some of which are not published on a timely basis or may have retroactive effect. Administrative and court proceedings in China may also be protracted, resulting in substantial costs and diversion of resources and management attention. Consequently, such uncertainties may limit the Group’s ability to enforce its contractual arrangements with the VIEs. Although the Group believes the contractual arrangements are in compliance with current PRC regulations, there can be no assurance that the PRC government would agree that these contractual arrangements comply with PRC licensing, registration or other regulatory requirements, with existing policies or with requirements or policies that may be adopted in the future. PRC laws, rules and regulations governing the validity of these contractual arrangements are uncertain and the relevant government authorities have broad discretion in interpreting these laws, rules and regulations. Such uncertainties on the compliance with PRC laws of the contractual arrangements may adversely affect the Group’s ability to consolidate the VIEs. Regulatory risk also encompasses the interpretation by the tax authorities of current tax laws, and the Group’s legal structure and scope of operations in the PRC, which could be subject to further restrictions resulting in limitations on the Group’s ability to conduct business in the PRC. | ||||||||
On January 19, 2015, the Ministry of Commerce of the PRC, or (the “MOFCOM”) released on its website for public comment a proposed PRC law (the “Draft FIE Law”) that appears to include VIEs within the scope of entities that could be considered to be foreign invested enterprises (or “FIEs”) that would be subject to restrictions under existing PRC law on foreign investment in certain categories of industry. Specifically, the Draft FIE Law introduces the concept of “actual control” for determining whether an entity is considered to be an FIE. In addition to control through direct or indirect ownership or equity, the Draft FIE Law includes control through contractual arrangements within the definition of “actual control.” If the Draft FIE Law is passed by the People’s Congress of the PRC and goes into effect in its current form, these provisions regarding control through contractual arrangements could be construed to reach the Group’s VIE arrangements, and as a result the Group’s VIEs could become explicitly subject to the current restrictions on foreign investment in certain categories of industry. The Draft FIE Law includes provisions that would exempt from the definition of foreign invested enterprises entities where the ultimate controlling shareholders are either entities organized under PRC law or individuals who are PRC citizens. The Draft FIE Law does not make clear how “control” would be determined for such purpose, and is silent as to what type of enforcement action might be taken against existing VIEs that operate in restricted industries and are not controlled by entities organized under PRC law or individuals who are PRC citizens. If a finding were made by PRC authorities, under existing law and regulations or under the Draft FIE Law if it becomes effective, that the Group’s operation of certain of its operations and businesses through VIEs, regulatory authorities with jurisdiction over the licensing and operation of such operations and businesses would have broad discretion in dealing with such a violation, including levying fines, confiscating the Group’s income, revoking the business or operating licenses of the affected businesses, requiring the Group to restructure its ownership structure or operations, or requiring the Group to discontinue all or any portion of its operations. Any of these actions could cause significant disruption to the Group’s business operations, and have a severe adverse impact on the Group’s cash flows, financial position and operating performance. | ||||||||
The following combined financial information of the Group’s VIEs and VIE’s subsidiary, as applicable, were included in the accompanying consolidated financial statements of the Group: | ||||||||
As of December 31, | ||||||||
2013 | 2014 | |||||||
RMB | RMB | |||||||
Total assets | 501,281 | 633,177 | ||||||
Total liabilities | 312,572 | 409,772 | ||||||
Payable to third parties | 189,803 | 270,533 | ||||||
Payable to Group entities | 122,769 | 139,239 | ||||||
For the year ended December 31, | ||||||||
2012 | 2013 | 2014 | ||||||
RMB | RMB | RMB | ||||||
Net revenue | 411,084 | 492,799 | 614,239 | |||||
Net income | 23,038 | 61,608 | 25,133 | |||||
Inter-company service fees paid/payable | 43,446 | 9,278 | 11,615 | |||||
For the year ended December 31, | ||||||||
2012 | 2013 | 2014 | ||||||
RMB | RMB | RMB | ||||||
Net cash provided by operating activities | 54,966 | 151,318 | 90,925 | |||||
Net cash used in investing activities | (67,544 | ) | (87,916 | ) | (97,104 | ) | ||
Effect of exchange rate changes on cash and cash equivalents | (11 | ) | (180 | ) | 134 | |||
Net (decrease)/increase in cash and cash equivalents | (12,589 | ) | 63,222 | (6,045 | ) | |||
The total assets of the consolidated VIEs and VIE’s subsidiary were mainly comprised of cash and cash equivalents, short-term deposits, accounts receivable, prepayments and other current assets, property and equipment, investment in equity investee, intangible assets and goodwill. The total liabilities of the consolidated VIEs and VIE’s subsidiary were mainly comprised of deferred revenue and accrued expenses and other current liabilities. | ||||||||
The revenue-producing assets of VIEs mainly include property and equipment, intangible assets and goodwill. There were also unrecognized revenue-producing assets including intellectual property such as patents and licenses, and self-developed software which were expensed as incurred as the amounts were not significant. The carrying values of property and equipment, intangible assets and goodwill of VIEs as of December 31, 2013 and 2014 were as follows: | ||||||||
As of December 31, | ||||||||
2013 | 2014 | |||||||
RMB | RMB | |||||||
Property and equipment, net | 99,296 | 91,208 | ||||||
Intangible assets, net | 4,275 | 3,610 | ||||||
Goodwill | 789 | 789 | ||||||
All of the Group’s revenues for the periods presented were contributed by the VIEs and VIE’s subsidiary. | ||||||||
b)Concentration of credit risks | ||||||||
Financial instruments that potentially subject the Group to significant concentration of credit risk primarily consist of cash and cash equivalents, short-term deposits, available-for-sale securities and accounts receivable. As of December 31, 2013 and 2014, the Group’s cash and cash equivalents and short-term deposits were held by financial institutions located in the PRC and Hong Kong that management believes are of high-credit ratings and quality. Available-for-sale securities were placed with a financial institution and have original maturities of one month. Accordingly, management determined that the Group’s available-for-sale securities are exposed to minimal credit risks. Accounts receivable are typically unsecured and are mainly derived from revenues collected by WVAS partners on behalf of the Group in the PRC and amounts due from sponsors who sponsored the Group’s offline events. The risk with respect to accounts receivable is mitigated by regular credit evaluations that the Group performs on the WVAS partners and offline events sponsors and its ongoing monitoring of outstanding balances. | ||||||||
c)Foreign currency risk | ||||||||
A majority of the Group’s operating transactions are denominated in RMB and a significant portion of the Group’s assets and liabilities is denominated in RMB. RMB is not freely convertible into foreign currencies. The value of the RMB is subject to changes in the central government policies and to international economic and political developments. In the PRC, certain foreign exchange transactions are required by laws to be transacted only by authorized financial institutions at exchange rates set by the People’s Bank of China (“PBOC”). Remittances in currencies other than RMB by the Group in China must be processed through PBOC or other China foreign exchange regulatory bodies which require certain supporting documentation in order to complete the remittance. | ||||||||
Fair_Value_Measurements
Fair Value Measurements | 12 Months Ended | |||||||||
Dec. 31, 2014 | ||||||||||
Fair Value Measurements | ||||||||||
Fair Value Measurements | ||||||||||
5.Fair Value Measurements | ||||||||||
The Group’s financial instruments include cash equivalents, short-term deposits, available-for-sale securities, accounts receivables, prepaid expenses and other current assets, other non-current assets, accounts payable, accrued expenses and other current liabilities, and accrued expenses and other liabilities, non-current portion. The carrying value of the Company’s short-term financial instruments approximates their fair value because of their short maturities. The carrying value of other non-current assets and accrued expenses and other liabilities, non-current portion approximates their fair value because the change in fair value after considering discount rate is considered immaterial. | ||||||||||
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (also referred to as an exit price). It establishes a hierarchy for inputs used in measuring fair value that gives the highest priority to observable inputs and the lowest priority to unobservable inputs. Valuation techniques used to measure fair value shall maximize the use of observable inputs. The hierarchy is as follows: | ||||||||||
Level 1 | ||||||||||
Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities. | ||||||||||
Level 2 | ||||||||||
Level 2 applies to assets or liabilities for which there are inputs other than quoted prices included within Level 1 that are observable for the assets or liabilities such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data. | ||||||||||
Level 3 | ||||||||||
Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. | ||||||||||
The Group engaged independent valuation specialists to assist them in determining the fair value of equity issued (including share options) and the goodwill and intangible assets arising from the Group’s business combination. | ||||||||||
When available, the Group uses quoted market prices to determine the fair value of an asset or liability. If quoted market prices are not available, the Group will measure fair value using valuation techniques that use, when possible, current market-based or independently sourced market parameters, such as interest rates and currency rates. Following is a description of the valuation techniques that the Group uses to measure the fair value of assets and liabilities that the Group measured and reported on its consolidated balance sheet at fair value on a recurring basis. | ||||||||||
The following table sets forth the financial instruments, measured at fair value, by level within the fair value hierarchy: | ||||||||||
Fair value measurements at reporting date using | ||||||||||
Quoted prices in | ||||||||||
Total fair value | active market | Significant other | Significant | |||||||
and carrying value | for identical | observable | unobservable | |||||||
on balance sheet | assets (Level 1) | inputs (Level 2) | inputs (Level 3) | |||||||
RMB | RMB | RMB | RMB | |||||||
As of December 31, 2013 | ||||||||||
Cash equivalents | 232,458 | — | 232,458 | — | ||||||
Short-term deposits | 336,299 | — | 336,299 | — | ||||||
Available-for-sale securities | 5,233 | — | 5,233 | — | ||||||
As of December 31, 2014 | ||||||||||
Cash equivalents | 196,810 | — | 196,810 | — | ||||||
Short-term deposits | 239,466 | — | 239,466 | — | ||||||
Available-for-sale securities | 15,715 | — | 15,715 | — | ||||||
Cash equivalents and short-term deposits: The Group’s cash equivalents and short term deposits mainly consist of time deposits placed with banks. The Group measures cash equivalents and short term deposits at fair value based on the pervasive interest rates in the market, which are also the interest rates as stated in the contracts with the banks. The Group classifies the valuation techniques that use the pervasive interest rates input as Level 2 of fair value measurements. Generally there are no quoted prices in active markets for identical time deposits at the reporting date. In order to determine the fair value, the Group must use the discounted cash flow method and observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. | ||||||||||
Available-for-sale securities: The Group measures available-for-sale securities at fair value. To estimate the fair value of investments in financial instruments with a variable interest rate indexed to the performance of underlying assets, the Group refers to the quoted rate of return provided by the investment company at the end of each period. The Group classifies the valuation techniques as Level 2 of fair value measurement. | ||||||||||
The following are other financial instruments not measured at fair value in the balance sheets but for which the fair value is estimated for disclosure purposes. | ||||||||||
Short-term receivables and payables: Accounts receivable and prepaid expenses and other current assets are financial assets with carrying values that approximate fair value due to their short term nature. Accounts payable and accrued expenses and other current liabilities are financial liabilities with carrying values that approximate fair value due to their short term nature. The Group estimates fair values of short-term receivables and payables and classifies the valuation technique as Level 3 of fair value measurement, as it uses estimated cash flow input which is unobservable in the market. | ||||||||||
Non-current assets and non-current liabilities : Non-current assets of receivables for rental deposits is a financial asset with carrying value that approximate fair value due to the change in fair value, after considering the discount rate, being immaterial. Accrued expenses and other liabilities, non-current portion is a financial liability with carrying value that approximate fair value due to the change in fair value, after considering the discount rate, being immaterial. The Group estimated fair values of non-current assets and non-current liabilities using the discounted cash flow method. The Group classifies the valuation technique as Level 3 of fair value measurement, as it uses estimated cash flow input which is unobservable in the market. | ||||||||||
Accounts_Receivable_net
Accounts Receivable, net | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Accounts Receivable, net | ||||||
Accounts Receivable, net | ||||||
6.Accounts Receivable, net | ||||||
The following summarized the Group’s accounts receivable, net as of December 31, 2013 and 2014: | ||||||
As of December 31, | ||||||
2013 | 2014 | |||||
RMB | RMB | |||||
Accounts receivable | 33,987 | 38,875 | ||||
Less: Allowance for doubtful accounts | — | (1,130 | ) | |||
Accounts receivable, net | 33,987 | 37,745 | ||||
The following summarized the changes in allowance for doubtful accounts: | ||||||
2013 | 2014 | |||||
RMB | RMB | |||||
Balance as of January 1 | 110 | — | ||||
Provision of bad debt | — | 2,364 | ||||
Write-off of bad debt | (110 | ) | (1,234 | ) | ||
Balance as of December 31 | — | 1,130 | ||||
Prepaid_Expenses_and_Other_Cur
Prepaid Expenses and Other Current Assets | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Prepaid Expenses and Other Current Assets | ||||||
Prepaid Expenses and Other Current Assets | ||||||
7.Prepaid Expenses and Other Current Assets | ||||||
Prepaid expenses and other current assets consisted of the following: | ||||||
As of December 31, | ||||||
2013 | 2014 | |||||
RMB | RMB | |||||
Prepaid commission to matchmaking service agencies | 6,172 | 45,915 | ||||
Prepaid expenses-other | 6,659 | 7,235 | ||||
Advances to employees | 2,761 | 4,014 | ||||
Interest receivables | 4,782 | 2,417 | ||||
Rental and other deposits | 2,781 | 3,653 | ||||
Inventory | — | 1,553 | ||||
Others | 540 | 1,714 | ||||
23,695 | 66,501 | |||||
Investment_in_equity_investee
Investment in equity investee | 12 Months Ended |
Dec. 31, 2014 | |
Investment in equity investee | |
Investment in equity investee | |
8.Investment in equity investee | |
In October 2014, Beijing HQS completed an acquisition of shares in Wuhan Didi Network Technology Co., Ltd. (“Wuhan Didi”), a developer of mobile applications in the PRC, for cash consideration of approximately RMB11.0 million. Beijing HQS holds 20% of economic interests and can exercise significant influence after the completion of this acquisition. The investment is accounted for under the cost method given that such shares contain certain terms such as liquidation preferences over ordinary shares. As a result, the shares are not considered in-substance common stock and are accounted for under the cost method. The fair value of this investment approximated to its carrying value as of December 31, 2014. | |
Property_and_Equipment_net
Property and Equipment, net | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Property and Equipment, net | ||||||
Property and Equipment, net | ||||||
9.Property and Equipment, net | ||||||
Property and equipment, net, consisted of the following: | ||||||
As of December 31, | ||||||
2013 | 2014 | |||||
RMB | RMB | |||||
Office buildings | 77,797 | 77,797 | ||||
Office buildings improvements | 3,884 | 3,948 | ||||
Computer and software | 54,271 | 56,942 | ||||
Furniture, fixture and other equipment | 4,544 | 4,960 | ||||
Motor vehicles | 407 | 407 | ||||
Leasehold improvements | 3,296 | 4,254 | ||||
144,199 | 148,308 | |||||
Less: accumulated depreciation and amortization | (44,715 | ) | (56,614 | ) | ||
Property and equipment, net | 99,484 | 91,694 | ||||
For the years ended December 31, 2012, 2013 and 2014, depreciation and amortization expenses for the property and equipment amount to RMB13,264, RMB15,576 and RMB13,716, respectively. | ||||||
Business_Combination
Business Combination | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Business Combination | ||||
Business Combination | ||||
10.Business Combination | ||||
In order to further expand its online business, on December 10, 2012, the Group acquired certain assets associated with the website of www.juedui100.com and www.juedui100.com.cn from Beijing Juedui 100 Network Technology Co., Ltd. (the “Juedui 100”) which operates an online platform for providing online dating services. Pursuant to the acquisition agreements, the total purchase consideration was RMB5,500 in cash. In accordance with the relevant accounting guidance, the acquired assets should be considered a business as the assets include both inputs and processes. | ||||
The Group accounted for the acquisition as a business combination and the fair value of the assets acquired by the Group was evaluated on the acquisition date. The recognized amounts of the identifiable assets were as follows: | ||||
As of December 10, 2012 | ||||
RMB | ||||
Identifiable intangible assets: | ||||
Brand name | 2,141 | |||
Customer relationships | 1,637 | |||
Source code | 933 | |||
Identifiable assets acquired | 4,711 | |||
Goodwill | 789 | |||
Cash consideration | 5,500 | |||
The excess of purchase price over identifiable assets acquired was recorded as goodwill, and attributed to the Group’s online services segment. Goodwill primarily represents the expected synergies from combining the online platform operations of the Group with the business acquired, which are expected to be complementary to each other. Goodwill is not deductible for tax purposes. | ||||
The acquired identifiable intangible assets were valued by various approaches, including the income approach and the cost approach, as appropriate. The Group engaged independent valuation specialists to assist them in determining the fair value of the identifiable intangible assets. | ||||
Acquisition-related costs incurred for the acquisition were not material and have been expensed as incurred in general and administrative expenses. | ||||
Prior to the acquisition, Juedui100 did not prepare its financial statements in accordance with U.S. GAAP and there was no standalone financial information available for the acquired business. Accordingly, the Group did not present the pro forma financial information with respect to the results of operations of the acquired business considering the financial impact of the acquired business was not material. | ||||
Intangible_assets_net
Intangible assets, net | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Intangible assets, net | ||||||
Intangible assets, net | ||||||
11.Intangible assets, net | ||||||
The following table summarizes the Company’s intangible assets, net: | ||||||
As of December 31, | ||||||
2013 | 2014 | |||||
RMB | RMB | |||||
Brand name | 2,141 | 2,141 | ||||
Customer relationships | 1,637 | 1,637 | ||||
Source code | 933 | 933 | ||||
Domain names | 305 | 305 | ||||
5,016 | 5,016 | |||||
Less: accumulated amortization | (741 | ) | (1,406 | ) | ||
Intangible assets, net | 4,275 | 3,610 | ||||
For the years ended December 31, 2012, 2013 and 2014, amortization expenses for the above intangible assets amounted to RMB142, RMB599 and RMB665, respectively. | ||||||
As of December 31, 2014, amortization expenses for future periods are estimated as follows: | ||||||
For the year ended December 31, | Amortization expenses | |||||
RMB | ||||||
2015 | 665 | |||||
2016 | 665 | |||||
2017 | 612 | |||||
2018 | 338 | |||||
2019 | 338 | |||||
Thereafter | 992 | |||||
Total | 3,610 | |||||
During the years ended December 31, 2012, 2013 and 2014, no impairment of intangible assets was recognized by the Group. | ||||||
Goodwill
Goodwill | 12 Months Ended |
Dec. 31, 2014 | |
Goodwill | |
Goodwill | |
12.Goodwill | |
Goodwill is attributable to the Group’s online services segment under which significant synergies are expected to arise after the Group’s acquisition. | |
The Company performed a goodwill impairment test as of year end date and concluded that no impairment should be recognized as of December 31, 2013 and 2014. No reasonable change to the assumptions would lead to an impairment charge. | |
Accrued_Expenses_and_Other_Lia
Accrued Expenses and Other Liabilities | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Accrued Expenses and Other Liabilities | ||||||
Accrued Expenses and Other Liabilities | ||||||
13.Accrued Expenses and Other Liabilities | ||||||
Accrued expenses and other liabilities consisted of the following: | ||||||
As of December 31, | ||||||
2013 | 2014 | |||||
RMB | RMB | |||||
Accrued salaries and welfare | 19,740 | 17,964 | ||||
Accrued advertising expenses | 2,371 | 2,388 | ||||
Accrued network support expenses | 1,908 | 1,801 | ||||
Business and other tax payable | 3,304 | 4,093 | ||||
Professional and other service fees | 6,556 | 9,262 | ||||
Deposits received from matchmaking service agencies | 2,850 | 8,980 | ||||
Others | 5,616 | 6,652 | ||||
Balance as at December 31 | 42,345 | 51,140 | ||||
Less: Current portion | 39,615 | 45,490 | ||||
Non-current portion | 2,730 | 5,650 | ||||
Taxation
Taxation | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Taxation | ||||||||
Taxation | ||||||||
14.Taxation | ||||||||
a)Business Tax, Value Added Tax and Surcharges | ||||||||
The Group’s PRC operations are subject to PRC business tax (“Business Tax”) and surcharges at rates ranging from 0% to 8.60%, depending on the nature of the service revenue and the geographical region. Business Tax and surcharges is calculated by multiplying the applicable tax rate by gross revenue, and is recognized when the revenue is recognized. The Group recognized RMB14,242, RMB17,090 and RMB16,345 of business tax and surcharges, as a reduction of revenues, for the years ended December 31, 2012, 2013 and 2014, respectively. | ||||||||
Effective from January 1, 2012, the PRC Ministry of Finance and the State Administration of Taxation launched a Business Tax to Value Added Tax (“VAT”) Transformation Pilot Program (the “Pilot Program”) for certain industries. VAT payable on goods sold or taxable labor services provided by a general VAT taxpayer for a taxable period is the net balance of the output VAT for the period after crediting the input VAT for the period. Hence, the amount of VAT payable does not result directly from output VAT generated from goods sold or taxable labor services provided. | ||||||||
With the adoption of the Pilot Program, Shanghai Miyuan, Beijing Miyuan, Beijing Aizhenxin and majority businesses of Shanghai HQS ceased to be subject to Business Tax. Shanghai Miyuan was subject to VAT at a rate of 3% from January 2012 to January 2013 and at a rate of 6% starting from February 2013. Beijing Miyuan was subject to VAT at a rate of 3% from September 2012 to December 2013 and at a rate of 6% starting from January 2014. Beijing Aizhenxin is subject to VAT at a rate of 3% starting from September 2012. Shanghai HQS’s online services, personalized matchmaking services and advertising services were subject to VAT at a rate of 6% starting from June 2014. Jiayuan Shanghai Center, Shanghai HQS’s events business, Shanghai HQS’s Beijing branch, Beijing HQS and Xique continued to be subject to Business Tax. | ||||||||
b)Income tax | ||||||||
The Cayman Islands and the British Virgin Islands | ||||||||
Under the common tax laws of the Cayman Islands, the Company is not subject to tax on its income or capital gains. In addition, upon payment of dividends by the Company to its shareholders, no Cayman Islands withholding tax will be imposed. | ||||||||
Under the current laws of the British Virgin Islands, BVI Company is a tax-exempted company. | ||||||||
Hong Kong | ||||||||
Jiayuan Hong Kong is not subject to Hong Kong profits tax on foreign-sourced income, dividends and capital gains. As an entity incorporated in Hong Kong, Jiayuan Hong Kong was subject to 16.5% income tax for the years ended December 31, 2012, 2013 and 2014 on its taxable profits generated from operations in Hong Kong. Payment of dividends is not subject to withholding tax in Hong Kong. | ||||||||
The PRC | ||||||||
The Company’s subsidiaries and VIEs in China are governed by the Enterprise Income Tax Law (“EIT Law”), which became effective on January 1, 2008. Pursuant to the EIT Law and its implementation rules, enterprises in China are generally subjected to tax at a statutory rate of 25%. Certified High and New Technology Enterprises (“HNTE”) are entitled to a favorable statutory tax rate of 15%. Qualified software enterprises can enjoy an income tax exemption for two years beginning with their first profitable year and a 50% tax reduction to the applicable tax rate for the subsequent three years. Qualified key software enterprises are entitled to a favorable statutory tax rate of 10%. | ||||||||
The Group’s PRC entities accrued for corporate income tax as follows: | ||||||||
· | Shanghai Miyuan was subject to 25% EIT in 2010. In 2011, Shanghai Miyuan was qualified as a software enterprise under which it is entitled to income tax exemption for the fiscal years 2011 and 2012 and a preferential tax rate of 12.5% from fiscal years 2013 through 2015. However, as Shanghai Miyuan was not continually qualified as a software enterprise in 2014, it was subject to 25% EIT in 2014 and thereafter. | |||||||
· | Shanghai HQS was subject to 15% EIT as a result of HNTE status from 2010 to 2012. In February 2014, Shanghai HQS was qualified as a key software enterprise and was subject to 10% EIT for 2013 and 2014. In April 2014, Shanghai HQS completed the process for the renewal of HNTE status and was continually entitled to a preferential income tax rate of 15% for 2013 to 2015. As Shanghai HQS is eligible for both preferential rates of 10% and 15% in 2013 and 2014, the Company elects to enjoy the rate of 10% for 2013 and 2014. | |||||||
· | In 2014, Beijing Miyuan was qualified as a software enterprise under which it is entitled to income tax exemption for two years beginning from its first year with taxable income and a 50% tax reduction to a 12.5% income tax rate for the subsequent three years. Beijing Miyuan incurred taxable loss in 2014. | |||||||
· | Beijing HQS, Xique, Beijing Aizhenxin and Jiayuan Shanghai Center were subject to 25% EIT from 2012 to 2014. | |||||||
In addition, under the EIT Law, effective from January 1, 2008, dividends, interests, rent, royalties and gains on transfers of property payable by a foreign-invested enterprise in the PRC to its foreign investor who is a non-resident enterprise are subject to withholding tax of 10%, unless such non-resident enterprise’s jurisdiction of incorporation has a tax treaty with the PRC that provides for a reduced rate of withholding tax. The withholding tax rate is 5% for the parent company incorporated in certain qualified jurisdictions if the parent company is the beneficial owner of the dividend and approved by the PRC tax authority to enjoy the preferential tax benefit. This withholding tax regulation imposed on the dividend income received from the Group’s PRC subsidiaries reduces the Group’s net income. On February 22, 2008, the Ministry of Finance and State Tax Bureau jointly issued a circular which stated that for foreign invested enterprises, all profits accumulated up to December 31, 2007 are exempted from withholding tax when they are distributed to foreign investors. | ||||||||
The EIT Law also provides that an enterprise established under the laws of foreign countries or regions but whose “de facto management body” is located in the PRC would be treated as a resident enterprise for PRC tax purposes and consequently be subject to the PRC income tax at the rate of 25% for its global income. The Implementation Rules of the EIT Law merely define the location of the “de facto management body” as “the place where the exercising, in substance, of the overall management and control of the production and business operation, personnel, accounting, properties, etc., of a non-PRC company is located.” Based on an assessment of surrounding facts and circumstances, the Group does not believe that it is likely that its operations outside of the PRC should be considered a resident enterprise for PRC tax purposes. However, due to limited guidance and implementation history of the EIT Law, should the Company and its overseas subsidiaries be treated as a resident enterprise for PRC tax purposes, they will be subject to PRC tax on worldwide income at a uniform tax rate of 25% retroactive to January 1, 2008. | ||||||||
The Company’s subsidiaries had not declared any dividend to their respective parent companies and had determined that it had no plan to declare or pay any dividends to the parent companies out of the accumulated undistributed earnings as of December 31, 2012. Accordingly, no deferred income tax was accrued and required to be accrued as of December 31, 2012. | ||||||||
On May 16, 2013, the Board of Directors of the Company declared a special cash dividend of US$0.26 per ADS, payable to record holders of the Company’s ordinary shares at the close of business on June 5, 2013. The special dividend of US$7,800 was paid out of reserves to the shareholders on June 18, 2013. On September 29, 2014, the Board of Directors of the Company further declared a special cash dividend of US$0.67 per ADS, payable to record holders of the Company’s ordinary shares at the close of business on October 15, 2014. The special dividend of US$19,767 was paid out of reserves to the shareholders on October 27, 2014 and October 29, 2014. As the Company assessed that it does not meet the criteria for being a tax resident enterprise in the PRC in accordance with Chinese EIT law and regulations, no withholding tax was withheld on behalf of the Company’s shareholders. | ||||||||
In addition, pursuant to the annual dividend policy which was approved by the Company’s board of directors on May 6, 2013, the Company expects to pay annual dividends with an aggregate amount of up to 60% of the Group’s annual net income before share-based compensation expenses. Accordingly, the Group assessed that only a portion of the net income of the PRC entities for the year ended December 31, 2013 and thereafter will be reinvested indefinitely. As a result, deferred tax liabilities of RMB6,517 were recorded as of December 31, 2014 for the accumulated earnings expected to be distributed as cash dividends from the Group’s PRC entities to the Group’s overseas entities. | ||||||||
The undistributed earnings held by the Group’s PRC entities as of December 31, 2013 and 2014 were RMB219,876 and RMB262,568, respectively. An estimated PRC withholding taxes of RMB21,988 and RMB26,257 would be due if all the earnings were remitted as dividends as of December 31, 2013 and 2014, respectively. | ||||||||
Composition of income tax expenses | ||||||||
The current and deferred portions of income tax expenses included in the Group’s consolidated statements of comprehensive income are as follows: | ||||||||
For the year ended December 31, | ||||||||
2012 | 2013 | 2014 | ||||||
RMB | RMB | RMB | ||||||
Current tax expenses | 8,753 | 9,520 | 6,434 | |||||
Deferred taxation | 474 | 3,533 | (3,427 | ) | ||||
Income tax expenses | 9,227 | 13,053 | 3,007 | |||||
Reconciliation of the differences between the PRC statutory EIT rate of 25% and the Group’s effective tax rate is as follows: | ||||||||
For the year ended December 31, | ||||||||
2012 | 2013 | 2014 | ||||||
RMB | RMB | RMB | ||||||
Statutory EIT rate | 25.0 | % | 25.0 | % | 25.0 | % | ||
Effect of non-deductible expenses | 4.9 | % | 2.6 | % | 7.9 | % | ||
Effect of lower tax rates in other jurisdictions | 0.3 | % | (0.8 | )% | 0.3 | % | ||
Effect of preferential tax treatments | (19.2 | )% | (15.0 | )% | (19.3 | )% | ||
Tax incentives for research and development expenses (i) | (3.1 | )% | (3.9 | )% | (7.2 | )% | ||
Withholding income tax for dividends | — | 6.0 | % | 8.3 | % | |||
Changes in valuation allowance: | 5.6 | % | 3.1 | % | (2.0 | )% | ||
- Unrecognized tax losses | 1.7 | % | 1.7 | % | 1.8 | % | ||
- Accrued salaries and other expenses | 0.2 | % | — | (1.2 | )% | |||
- Advertising expenses | 3.7 | % | 1.4 | % | (3.8 | )% | ||
- Doubtful accounts | — | — | 1.2 | % | ||||
Effective income tax rate | 13.5 | % | 17.0 | % | 13.0 | % | ||
(i) | The Group obtained a tax incentive relating to research and development expense of one of its VIEs in the PRC. Under such tax incentive rule, the Group may claim an additional tax deduction amounting to 50% of the research and development expenses incurred in a year. | |||||||
The effect of the preferential tax treatments available to the Group is as follows. | ||||||||
For the year ended December 31, | ||||||||
2012 | 2013 | 2014 | ||||||
RMB | RMB | RMB | ||||||
Preferential tax treatments impact to net income to ordinary shareholders | 15,201 | 14,498 | 6,125 | |||||
Per share effect, basic | 0.33 | 0.32 | 0.14 | |||||
Per share effect, diluted | 0.32 | 0.32 | 0.13 | |||||
Deferred tax assets and liabilities | ||||||||
Deferred taxes are measured using the enacted tax rates for the periods in which they are expected to be reversed. Significant components of the Group’s deferred tax assets and liabilities are as follows: | ||||||||
As of December 31, | ||||||||
2013 | 2014 | |||||||
RMB | RMB | |||||||
Deferred tax assets, current | ||||||||
Net operating loss carry forwards | 4,365 | 6,565 | ||||||
Accrued salaries and other expenses | 3,391 | 3,329 | ||||||
Advertising expenses | 15,214 | 18,799 | ||||||
Government subsidies | 333 | 169 | ||||||
Other | 188 | 616 | ||||||
Total deferred tax assets, current | 23,491 | 29,478 | ||||||
Deferred tax assets, non-current | — | — | ||||||
Total deferred tax assets | 23,491 | 29,478 | ||||||
Less: valuation allowance | ||||||||
Net operating loss carry forwards | (4,365 | ) | (4,667 | ) | ||||
Accrued salaries and other expenses | (284 | ) | — | |||||
Advertising expenses | (15,214 | ) | (15,448 | ) | ||||
Other | — | (381 | ) | |||||
Total valuation allowance | (19,863 | ) | (20,496 | ) | ||||
Net deferred tax assets | 3,628 | 8,982 | ||||||
Deferred tax liabilities, non-current | ||||||||
Withholding income tax for dividends | 4,590 | 6,517 | ||||||
The Group had net operating loss carry forwards from certain subsidiaries, VIEs and VIE’s subsidiary amounting to RMB34,217 as of December 31, 2014, of which RMB1,983 will expire on December 31, 2015, RMB6,392 will expire on December 31, 2016, RMB3,522 will expire on December 31, 2017, RMB5,043 will expire on December 31, 2018 and RMB16,204 will expire on December 31, 2019. | ||||||||
The Group evaluates a variety of factors in determining the amount of the valuation allowance, including the Group’s operating history, accumulated deficit, existence of taxable temporary differences and reversal periods. | ||||||||
In addition, pursuant to the EIT Law, the deductible advertising expenses should be no more than 15% of the revenues as determined under PRC GAAP and the excess amount could be carried forward to the following years. As the Group expects certain excess amount of advertising expenses incurred by shanghai HQS in previous years could be further deductible in 2015, the Group recognized the deferred tax assets for such amount. Other than that, the Group expects the deferred tax asset in relation to the additional excess amount of advertising expenses is not realizable in the foreseeable future, accordingly, full valuation allowance is provided. The following table shows the movements of valuation allowance for the years presented: | ||||||||
Years Ended December 31, | ||||||||
2012 | 2013 | 2014 | ||||||
RMB | RMB | RMB | ||||||
Balance at beginning of the year | (13,652 | ) | (17,315 | ) | (19,863 | ) | ||
Change in valuation allowance | (3,663 | ) | (2,548 | ) | (633 | ) | ||
Balance at end of the year | (17,315 | ) | (19,863 | ) | (20,496 | ) | ||
Ordinary_Shares_and_Treasury_S
Ordinary Shares and Treasury Shares | 12 Months Ended |
Dec. 31, 2014 | |
Ordinary Shares and Treasury Shares | |
Ordinary Shares and Treasury Shares | |
15.Ordinary Shares and Treasury Shares | |
As of December 31, 2014, the Company was authorized to issue 100,000,000 ordinary shares, at par value of US$0.001 per share, and 49,030,944 and 49,930,944 ordinary shares were issued as of December 31, 2013 and 2014, respectively. | |
As of December 31, 2014, 592,097 ordinary shares were issued to a depository and the sole purpose of such depository is to issue ADSs upon the exercise of options granted pursuant to the 2007 Share Incentive Plan (the “Plan”). These ordinary shares were included in issued and outstanding shares on the Group’s balance sheet and statement of changes in shareholders’ equity as of and for the year ended December 31, 2014 although these shares and the related ADSs were not issued to any option holders. The shares issued and held with the depository do not have any shareholder rights and do not have rights to any dividends if and when declared by the Company. Accordingly, these shares held with the depository are accounted for as if they were treasury shares. | |
In December 2011, the Board of Directors of the Company authorized a share repurchase plan, pursuant to which the Company was authorized to repurchase its own issued and outstanding ADSs up to an aggregate value of US$10,000 from the open market from time to time within one year. In December 2012, the Board of Directors approved another US$10,000 share repurchase plan to authorize the Company to repurchase its own issued and outstanding ADSs from the open market from time to time within one year (“2013 repurchase program”). In November 2013, the Board of Directors approved a twelve-month extension of the 2013 repurchase program. The share repurchase plans do not require the Company to acquire a specific number of shares. | |
During the year ended December 31, 2012, 2013 and 2014, the Company repurchased 2,004,526 ADSs, 931,593 ADSs and 776,341 ADSs for total consideration of approximately US$10,076, US$5,359 and US$4,287 from the open market, respectively. The ordinary shares representing the repurchased ADS are recorded as treasury shares at purchase cost at the time of repurchase. In 2012, 258,450 ordinary shares were cancelled while in 2013 and 2014, nil ordinary shares were cancelled. The Company recognized the difference between the repurchase costs and the par value in additional paid-in capital. The remaining 5,310,240 ordinary shares which were repurchased but not cancelled were recorded as treasury shares at purchase cost at the time of repurchase as of December 31, 2014. | |
Sharebased_Compensation
Share-based Compensation | 12 Months Ended | |||||||||
Dec. 31, 2014 | ||||||||||
Share-based Compensation | ||||||||||
Share-based Compensation | ||||||||||
16.Share-based Compensation | ||||||||||
a)Share Incentive Plan | ||||||||||
On May 14, 2007, the Board of Directors of the BVI Company approved the plan, which provides for the issuance of options to purchase up to 2,960,606 ordinary shares, to any qualified persons, as determined by the Board of Directors of the BVI Company. On December 8, 2010, the Board of Directors of the Company passed a resolution to increase the total number of ordinary shares reserved under the Plan to 5,233,920 ordinary shares. | ||||||||||
On June 15, 2012, the shareholders passed a resolution to increase the maximum aggregate number of ordinary shares that may be delivered pursuant to awards granted to eligible persons under the Plan by 2,400,000 ordinary shares, from 5,233,920 ordinary shares to 7,633,920 ordinary shares, and amended the Plan to allow the administrator of the Plan to have additional flexibility to modify awards granted under this Plan, including the re-pricing of “underwater” share options, without shareholder approval. | ||||||||||
As stipulated in the share option agreements, the awards granted shall vest in accordance with one of the following conditions: (1) over a four-year service period, with 25% of the options to vest on the first anniversary of the date of grant, and the remaining 75% of the options to vest on a pro-rata basis of the calendar quarter-end of each of the 12 quarters after the first anniversary of the date of grant; or (2) over a four-year service period, with 25% of the options to vest on the date of IPO, and the remaining 75% of the options to vest on a pro-rata basis on the calendar quarter-end of each of the 12 quarters following the date of IPO; or (3) 100% upon the date of IPO. | ||||||||||
On July 12, 2012, the Board of Directors of the Company approved to amend certain option awards granted by the Company to a director and certain employees of the Company during the period from December 2010 to July 2011. A total of 546,000 share options granted at the original exercise prices of $5.00 to $7.44 per share were cancelled and replaced by a total of 255,453 share options with an exercise price of $3.227 per share, the then fair value of the ordinary share on the modification date. | ||||||||||
On June 5, 2013, the Board of Directors of the Company approved to amend 120,850 share options granted by the Company to certain directors, employees of the Company and a non-employee on June 6, 2007 to extend the option life for one year to June 5, 2014. | ||||||||||
On October 10, 2014, the Board of Directors of the Company approved to amend all of the share options that have not been exercised. After the modification, the new exercise price was reduced by US$0.67 per ADS compared with original exercise price. | ||||||||||
The aforementioned modifications were accounted for pursuant to ASC 718 under US GAAP. The incremental fair value before and after the modification was recognized as follows: (a) for vested options, the incremental share-based compensation expenses are recognized immediately; (b) For non-vested options, the incremental share-based compensation expenses are recognized in the statement of comprehensive income over the remaining vesting period. The incremental fair values were determined to be immaterial. | ||||||||||
The Company’s share option activities for the years ended December 31, 2012, 2013 and 2014 are summarized below: | ||||||||||
Share options outstanding | ||||||||||
Share | Weighted | Weighted | Weighted | |||||||
options | average | average | average | |||||||
exercise | remaining | grant | ||||||||
price | contractual | date fair | ||||||||
life | value | |||||||||
(in years) | ||||||||||
US$ | US$ | |||||||||
Balances outstanding at January 1, 2012 | 4,382,636 | 2.78 | 4.23 | 1.57 | ||||||
Granted | 2,410,000 | 3.35 | 1.26 | |||||||
Exercised | (913,801 | ) | 1.05 | 0.9 | ||||||
Modified | (290,547 | ) | 3.23 | 1.06 | ||||||
Forfeited | (1,169,906 | ) | 4.35 | 1.95 | ||||||
Expired | (50,000 | ) | 0.3 | 0.02 | ||||||
Balances outstanding at December 31, 2012 | 4,368,382 | 2.69 | 4.34 | 1.3 | ||||||
Granted | 90,000 | 4.61 | 1.15 | |||||||
Exercised | (981,992 | ) | 1.33 | 1.32 | ||||||
Forfeited | (291,915 | ) | 3.87 | 1.37 | ||||||
Expired | (50,000 | ) | 0.3 | 0.05 | ||||||
Balances outstanding at December 31, 2013 | 3,134,475 | 3.1 | 3.98 | 1.31 | ||||||
Granted | 457,500 | 3.71 | 1.22 | |||||||
Exercised | (642,058 | ) | 2 | 1.09 | ||||||
Forfeited | (173,462 | ) | 3.41 | 1.28 | ||||||
Balances outstanding at December 31, 2014 | 2,776,455 | 3.02 | 3.65 | 1.3 | ||||||
Exercisable at December 31, 2012 | 1,353,698 | 1.4 | 2.39 | 1.24 | ||||||
Exercisable at December 31, 2013 | 1,357,529 | 2.75 | 3.4 | 1.31 | ||||||
Exercisable at December 31, 2014 | 1,373,002 | 2.82 | 3.15 | 1.36 | ||||||
As of December 31, 2014, the intrinsic value of outstanding and exercisable share options was US$918 and US$618, respectively, which is calculated as the difference between the Company’s closing stock price as of December 31, 2014 and the exercise price of the share options. For the year ended December 31, 2014, 722,919 shares of options were vested. | ||||||||||
For the year ended December 31, 2012, 2013 and 2014, the total intrinsic value of options exercised was US$2,172, US$2,665 and US$1,709, respectively. | ||||||||||
The fair value of each option at the grant date and modification date were estimated using the Binominal Option Pricing Model by the Company with assistance from independent valuation specialists. | ||||||||||
The following table summarizes the assumptions used to estimate the fair values of the share options granted in the years presented: | ||||||||||
For the year ended December 31, | ||||||||||
2012 | 2013 | 2014 | ||||||||
Risk-free interest rate | 1.30%-2.25% | 2.05% | 2.70% | |||||||
Exercise multiple | 2.80 | 2.80 | 2.80 | |||||||
Expected forfeiture rate | 5% | 5% | 5% | |||||||
Contractual life of option | 6 years | 6 years | 6 years | |||||||
Expected volatility | 38.00%-38.88% | 39.00% | 45.00% | |||||||
Dividend yield | — | 5% | 4% | |||||||
The risk-free interest rate was based on the market yield of US$ denominated China International Government Bonds with maturity terms equal to the contractual life of option. The exercise multiple is calculated as the ratio of fair value of stock over the exercise price as at the time the share option is exercised and estimated based on an empirical research study regarding the early exercise behavior of employees with share options. Expected forfeiture rate was estimated based on annual staff turnover for periods after June 2007. Pursuant to the Plan, the contractual life of the share options is 6 years. The expected volatility was estimated based on both historical volatility of comparable companies and historical volatility of the Company since January 1, 2012. For the options granted before 2013, no dividends were assumed in the estimation considering the Company has no history or expectation of paying dividends on its ordinary shares. For the options granted in 2013 and 2014, 5% and 4% dividends were assumed in the estimation respectively considering the Company’s plan to distribute annual dividends in 2013 and thereafter. | ||||||||||
The total fair value of equity awards vested during the year ended December 31, 2012, 2013 and 2014 were RMB4,246, RMB9,275 and RMB5,912, respectively. | ||||||||||
For the years ended December 31, 2012, 2013 and 2014, the Group recorded share-based compensation of RMB10,891, RMB8,276 and RMB5,522, respectively, using graded-vesting method, for the options granted with service conditions. | ||||||||||
As of December 31, 2014, total amount of unrecognized compensation costs relating to non-vested share options granted by the Company amounted to RMB3,717. These unrecognized compensation costs are expected to be recognized over a weighted average period of 0.89 years. | ||||||||||
b)Founder’s Shares | ||||||||||
On December 16, 2009, pursuant to an agreement entered into by Ms. Haiyan Gong, the founder and Mr. Qingyuan Fang, the then chief operating officer (“COO”) of the Company (“Founder’s Share Agreement”), the COO was granted 398,000 options for the BVI Company’s ordinary shares (the “Founder’s Shares”) held by Aprilsky Ltd., a company ultimately owned by Ms. Haiyan Gong. The awards have an exercise price of US$1.256 and shall vest over a four year period, with 50% of the options to vest on the second anniversary and 50% of the options to vest on the fourth anniversary of the Founder’s Share Agreement signing date, subject to the employee’s continued service with the Company. | ||||||||||
The Company recognized these awards as employee share-based compensation awards in accordance with the applicable guidance, and measured the fair value of the awards on the grant date. Compensation expense was recognized over the requisite service period using the graded vesting method. | ||||||||||
Share-based compensation expenses related to the Founder’s Shares of RMB92, RMBnil and RMBnil were recognized in general and administrative expenses in the consolidated statements of comprehensive income for the year ended December 31, 2012, 2013 and 2014, respectively. | ||||||||||
In July 2012, upon the termination of employment of the COO, the unexercised options were forfeited and the recognized compensation cost was reversed. | ||||||||||
c)Restricted Shares | ||||||||||
For the years ended December 31, 2012, 2013 and 2014, the Company granted 281,540, 34,286 and 486,000 restricted shares (the “Restricted Shares”), respectively, to certain key employees of the Company. These Restricted Shares shall vest over a four-year service period, with 25% of the Restricted Shares subject to vest on the first anniversary of the date of grant and the remaining 75% subject to vest in twelve quarterly installments. | ||||||||||
The Company’s Restricted Shares’ activities for the year ended December 31, 2013 and 2014 are summarized below: | ||||||||||
Restricted Shares outstanding | ||||||||||
Restricted Shares | Weighted average | |||||||||
remaining contractual life | ||||||||||
(in years) | ||||||||||
Balances outstanding at December 31, 2012 | 281,540 | 5.34 | ||||||||
Granted | 34,286 | |||||||||
Forfeited | (2,885 | ) | ||||||||
Balances outstanding at December 31, 2013 | 312,941 | 4.49 | ||||||||
Granted | 486,000 | |||||||||
Exercised | (5,211 | ) | ||||||||
Forfeited | (13,623 | ) | ||||||||
Balances outstanding at December 31, 2014 | 780,107 | 4.73 | ||||||||
The total fair value of Restricted Shares vested during the year ended December 31, 2012, 2013 and 2014 were RMBnil, RMB2,580 and RMB1,850, respectively. | ||||||||||
For the year ended December 31, 2012, 2013 and 2014, the Group recorded share-based compensation of RMB2,380, RMB2,152 and RMB4,040, respectively, related to the Restricted Shares using the graded-vesting method. | ||||||||||
As of December 31, 2014, unrecognized compensation expenses relating to the non-vested Restricted Shares amounted to RMB7,406. These expenses are expected to be recognized over a weighted average period of 1.03 years. For the year ended December 31, 2014, 80,198 restricted shares were vested. | ||||||||||
Net_Income_Per_Share
Net Income Per Share | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Net Income Per Share | ||||||||
Net Income Per Share | 17.Net Income Per Share | |||||||
Basic and diluted net income per share for each of the years presented are calculated as follows: | ||||||||
For the year ended December 31, | ||||||||
2012 | 2013 | 2014 | ||||||
RMB | RMB | RMB | ||||||
Numerator: | ||||||||
Net income | 58,937 | 63,656 | 20,107 | |||||
Denominator: | ||||||||
Weighted average number of ordinary shares outstanding—basic | 46,297,314 | 44,910,676 | 44,423,885 | |||||
Dilutive effect of share options | 1,445,784 | 917,246 | 966,924 | |||||
Weighted average number of ordinary shares outstanding—diluted | 47,743,098 | 45,827,922 | 45,390,809 | |||||
Basic net income per share | 1.27 | 1.42 | 0.45 | |||||
Diluted net income per share | 1.23 | 1.39 | 0.44 | |||||
For the years ended December 31, 2012, 2013 and 2014, the potentially dilutive share options and Restricted Shares of 1,012,007, 296,857 and 120,758, respectively, were not included in the calculation of diluted net income per share where their inclusion would be anti-dilutive. | ||||||||
As of December 31, 2013 and 2014, 339,366 and 592,097 ordinary shares were issued to a depository and the sole purpose of such depository is to issue ADS upon the exercise of options granted pursuant to the Plan. These shares were not issued to any option holders. The shares issued and held with the depository do not have any shareholder rights and do not have rights to any dividends if and when declared by the Company. Accordingly, these shares held with the depository are accounted for as if they were treasury shares. The Group did not include these ordinary shares in the calculation of basic and diluted net income per share for the year ended December 31, 2013 and 2014 as these shares are not considered outstanding for net income per share calculation purposes. | ||||||||
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Commitments and Contingencies | ||||
Commitments and Contingencies | ||||
18.Commitments and Contingencies | ||||
a)Operating lease commitments | ||||
Future minimum payments under non-cancellable operating leases with initial terms in excess of one year consist of the following at December 31, 2014: | ||||
Amount | ||||
RMB | ||||
Year ending December 31, | ||||
2015 | 8,463 | |||
2016 | 5,382 | |||
2017 | 450 | |||
2018 and thereafter | — | |||
Total | 14,295 | |||
For the years ended December 31, 2012, 2013 and 2014, total rental expenses amounted to approximately RMB6,387, RMB4,795 and RMB4,843, respectively. | ||||
The Group did not have any significant capital and other commitments, long-term obligations, or guarantees as of December 31, 2014. | ||||
b)Contingencies | ||||
The Group is not currently a party to, nor is aware of, any legal proceeding, investigation or claim which is likely to have a material adverse effect on the Group’s business, financial condition, results of operations, or cash flows. The Group did not record any legal contingencies as of December 31, 2014. | ||||
Related_Party_Transactions
Related Party Transactions | 12 Months Ended | ||
Dec. 31, 2014 | |||
Related Party Transactions | |||
Related Party Transactions | |||
19.Related Party Transactions | |||
The table below sets forth the related parties and their relationships with the Group: | |||
Related Party | Relationship with the Group | ||
Ms. Haiyan Gong (Note) | Nominee shareholder of the VIEs, non-executive co-chairman of the Board of Directors, and the Company’s shareholder. | ||
Mr. JP Gan | Member of the Board of Directors and Compensation Committee, and the chairman of Company’s Nominating and Corporate Governance Committee. | ||
Note: In March 2015, Ms. Haiyan Gong resigned from her position as a director of the Company and will no longer hold the position of co-chairman of the Board. | |||
During the years presented in the financial statements, there were no significant related party transactions except for the following: | |||
On December 24, 2012, the Group entered into a consultancy agreement with Ms. Haiyan Gong, under which Ms. Haiyan Gong agreed to provide, among other things, certain consultant services for a term of three years effective from January 1, 2013 and would receive a monthly fee of RMB49. The Group recorded general and administrative expense of RMB633 and RMB643 in connection with this agreement for the years ended December 31, 2013 and 2014, respectively. | |||
On October 29, 2013, the Group entered into a personalized matchmaking services agreement with Mr. JP Gan, under which the Group agreed to provide personalized matchmaking services for RMB120 for a term of 20 months. The Group recognized revenues of RMB12 and RMB72 for the years ended December 31, 2013 and 2014, respectively. | |||
Segment_Information
Segment Information | 12 Months Ended | |||||||||
Dec. 31, 2014 | ||||||||||
Segment Information | ||||||||||
Segment Information | ||||||||||
20.Segment Information | ||||||||||
In accordance with relevant US GAAP guidance, the reportable segments represent the Group’s operating segments for which separate financial information is available and which is utilized on a regular basis by its chief operating decision maker (“CODM”) to assess performance and to allocate resources. In identifying its reportable segments, the Group also considers the nature of services provided by its operating segments. The Group’s CODM has been identified as the Board of Directors (“BOD”), who reviews the consolidated and segment results when making decisions about allocation of resources and assessing performance of the Group. | ||||||||||
Prior to 2013, the Group had operated in three reportable segments which were online services, events and personalized matchmaking services, and other services. In 2013, the Group restructured its personalized matchmaking business and entered into the cooperation arrangements with matchmaking service agencies in different cities in the PRC. In order to manage the business more effectively, the Group’s CODM are presented with financial information on this business on a stand-alone basis. In addition, financial information for events services was combined with other services when presented. Accordingly, the reportable segments are online services, personalized matchmaking services, and events and other services in 2013 and 2014. Information for net revenues, cost of revenues and gross profit by segment was recast to conform to the current presentation for all periods presented. | ||||||||||
The accounting policies of the segments are the same as those described in the summary of significant accounting policies. The CODM evaluates performance based on each reporting segment’s revenues, cost of revenues, and gross profit. The CODM does not review operating expenses or balance sheet information to measure the performance of the reportable segments, nor is this part of the segment information regularly provided to the CODM. | ||||||||||
For the year ended December 31, 2012 | ||||||||||
Online services | Personalized | Events and other | Consolidated | |||||||
matchmaking | services | |||||||||
services | ||||||||||
RMB | RMB | RMB | RMB | |||||||
Net revenues | 362,492 | 33,143 | 15,168 | 410,803 | ||||||
Cost of revenues | (117,830 | ) | (15,903 | ) | (9,952 | ) | (143,685 | ) | ||
Gross profit | 244,662 | 17,240 | 5,216 | 267,118 | ||||||
For the year ended December 31, 2013 | ||||||||||
Online services | Personalized | Events and other | Consolidated | |||||||
matchmaking | services | |||||||||
services | ||||||||||
RMB | RMB | RMB | RMB | |||||||
Net revenues | 422,088 | 52,458 | 18,060 | 492,606 | ||||||
Cost of revenues | (140,975 | ) | (29,792 | ) | (9,754 | ) | (180,521 | ) | ||
Gross profit | 281,113 | 22,666 | 8,306 | 312,085 | ||||||
For the year ended December 31, 2014 | ||||||||||
Online services | Personalized | Events and other | Consolidated | |||||||
matchmaking | services | |||||||||
services | ||||||||||
RMB | RMB | RMB | RMB | |||||||
Net revenues | 425,544 | 164,598 | 23,848 | 613,990 | ||||||
Cost of revenues | (148,811 | ) | (117,054 | ) | (11,924 | ) | (277,789 | ) | ||
Gross profit | 276,733 | 47,544 | 11,924 | 336,201 | ||||||
The Group primarily operates in the PRC, accordingly, no geographical information is presented. | ||||||||||
Restricted_Net_Assets
Restricted Net Assets | 12 Months Ended | |||||||||
Dec. 31, 2014 | ||||||||||
Restricted Net Assets | ||||||||||
Restricted Net Assets | 21.Restricted Net Assets | |||||||||
Relevant PRC laws and regulations permit payments of dividends by the Company’s subsidiaries, VIEs and VIE’s subsidiary in China only out of their retained earnings, if any, as determined in accordance with PRC accounting standards and regulations. In addition, the Company’s subsidiaries, VIEs and VIE subsidiary in China are required to make certain appropriation of net after-tax profits or increase in net assets to the statutory surplus fund (see Note 3(s)) prior to payment of any dividends. As a result of these and other restrictions under PRC laws and regulations, the Company’s subsidiaries, VIEs and VIE’s subsidiary in China are restricted in their ability to transfer their net assets to the Company in terms of cash dividends, loans or advances, which restricted portion amounted to approximately RMB120,528 and RMB113,771 as of December 31, 2013 and 2014, respectively. As of December 31, 2013 and 2014, the retained earnings balance of the Group’s PRC entities after appropriation to statutory reserves, as determined under PRC GAAP, was RMB219,876 and RMB262,568, respectively. Even though the Company currently does not require any such dividends, loans or advances from the PRC subsidiaries or VIEs for working capital and other funding purposes, the Company may in the future require additional cash resources from the Company’s subsidiaries, VIEs and VIE’s subsidiary in China due to changes in business conditions, to fund future acquisitions and development, or merely to declare and pay dividends to make distributions to shareholders. Except for the above, there is no other restriction on use of proceeds generated by the Company’s subsidiaries, VIEs and VIE’s subsidiary to satisfy any obligations of the Company. | ||||||||||
The Company performed a test on the restricted net assets of its consolidated subsidiaries, VIEs and VIE’s subsidiary (the “restricted net assets”) in accordance with Securities and Exchange Commission Regulation S-X Rule 4-08 (e)(3), “General Notes to the Financial Statements” and concluded that it was applicable for the Company to disclose the condensed financial information for the parent company for the year ended December 31, 2014. For the purposes of presenting parent only financial information, the Company records its investments in its subsidiaries and VIEs under the equity method of accounting. Such investments are presented on the separate condensed balance sheets of the Company as “Investments in subsidiaries and VIEs” and the profit of the VIEs is included in “Share of income of subsidiaries and VIEs” in the condensed statement of comprehensive income. | ||||||||||
The subsidiaries did not pay any dividends to the Company for the years presented. Certain information and footnote disclosures generally included in financial statements prepared in accordance with US GAAP have been condensed and omitted. The footnote disclosures represent supplemental information relating to the operations of the Company, as such, these information should be read in conjunction with the notes to the consolidated financial statements of the Group. | ||||||||||
As of December 31, 2013 and 2014, the Company had no significant capital and other commitments, long-term obligations, or guarantee. | ||||||||||
The Company’s accounting policies are the same as the Group’s policies with the exception of the accounting for the investments in subsidiaries and VIE. | ||||||||||
FINANCIAL INFORMATION OF PARENT COMPANY | ||||||||||
CONDENSED BALANCE SHEETS | ||||||||||
AS OF DECEMBER 31, 2013 AND 2014 | ||||||||||
(All amounts in thousands) | ||||||||||
As of December 31, | ||||||||||
2013 | 2014 | 2014 | ||||||||
RMB | RMB | US$ | ||||||||
ASSETS | ||||||||||
Current assets: | ||||||||||
Cash and cash equivalents | 73,365 | 58,342 | 9,403 | |||||||
Short-term deposits | 177,319 | 9,466 | 1,526 | |||||||
Prepaid expenses and other current assets | 8,000 | 7,955 | 1,282 | |||||||
Total current assets | 258,684 | 75,763 | 12,211 | |||||||
Non-current assets: | ||||||||||
Investments in subsidiaries and VIEs | 286,455 | 316,253 | 50,971 | |||||||
Total assets | 545,139 | 392,016 | 63,182 | |||||||
LIABILITIES | ||||||||||
Current liabilities: | ||||||||||
Accrued expenses and other current liabilities, current portion | 5,921 | 4,976 | 802 | |||||||
Total current liabilities | 5,921 | 4,976 | 802 | |||||||
Total liabilities | 5,921 | 4,976 | 802 | |||||||
SHAREHOLDERS’ EQUITY | ||||||||||
Ordinary shares (US$0.001 par value; 100,000,000 shares authorized as of December 31, 2013 and 2014; 49,030,944 shares issued and outstanding as of December 31, 2013; 49,930,944 shares issued and outstanding as of December 31, 2014) | 349 | 354 | 57 | |||||||
Additional paid-in capital | 506,458 | 358,768 | 57,823 | |||||||
Less: Treasury shares (4,145,729 and 5,310,240 shares as of December 31, 2013 and 2014, respectively) | (91,100 | ) | (117,480 | ) | (18,934 | ) | ||||
Statutory reserves | 9,974 | 10,103 | 1,628 | |||||||
Retained earnings | 126,367 | 146,345 | 23,587 | |||||||
Accumulated other comprehensive loss | (12,830 | ) | (11,050 | ) | (1,781 | ) | ||||
Total shareholders’ equity | 539,218 | 387,040 | 62,380 | |||||||
Total liabilities and shareholders’ equity | 545,139 | 392,016 | 63,182 | |||||||
FINANCIAL INFORMATION OF PARENT COMPANY | ||||||||||
CONDENSED STATEMENTS OF COMPREHENSIVE INCOME | ||||||||||
FOR THE YEARS ENDED DECEMBER 31, 2012, 2013 AND 2014 | ||||||||||
(All amounts in thousands) | ||||||||||
For the Year Ended December 31, | ||||||||||
2012 | 2013 | 2014 | 2014 | |||||||
RMB | RMB | RMB | US$ | |||||||
Operating expenses: | ||||||||||
General and administrative expenses | (6,443 | ) | (4,461 | ) | (3,369 | ) | (543 | ) | ||
Total operating expenses | (6,443 | ) | (4,461 | ) | (3,369 | ) | (543 | ) | ||
Operating loss | (6,443 | ) | (4,461 | ) | (3,369 | ) | (543 | ) | ||
Share of income of subsidiaries and VIEs | 59,671 | 61,151 | 20,251 | 3,264 | ||||||
Interest income | 6,595 | 4,329 | 4,147 | 668 | ||||||
Foreign currency exchange (loss)/income, net | (1,829 | ) | 2,239 | (1,536 | ) | (248 | ) | |||
Other income, net | 943 | 398 | 614 | 99 | ||||||
Income before income tax | 58,937 | 63,656 | 20,107 | 3,240 | ||||||
Income tax expenses | — | — | — | — | ||||||
Net income | 58,937 | 63,656 | 20,107 | 3,240 | ||||||
Net income | 58,937 | 63,656 | 20,107 | 3,240 | ||||||
Other comprehensive (loss)/income: | ||||||||||
Foreign currency translation adjustments, net of tax of RMB nil | (775 | ) | (9,083 | ) | 1,799 | 290 | ||||
Share of other comprehensive income/(loss) of subsidiaries and VIEs, net of tax of RMB nil | 3 | 65 | (19 | ) | (3 | ) | ||||
Other comprehensive (loss)/income | (772 | ) | (9,018 | ) | 1,780 | 287 | ||||
Comprehensive income | 58,165 | 54,638 | 21,887 | 3,527 | ||||||
FINANCIAL INFORMATION OF PARENT COMPANY | ||||||||||
CONDENSED STATEMENTS OF CASH FLOWS | ||||||||||
FOR THE YEARS ENDED DECEMBER 31, 2012, 2013 AND 2014 | ||||||||||
(In thousands) | ||||||||||
For the Year Ended December 31, | ||||||||||
2012 | 2013 | 2014 | 2014 | |||||||
RMB | RMB | RMB | US$ | |||||||
Cash flows provided by operating activities | 26,046 | 519 | 491 | 79 | ||||||
Cash flows provided by/(used in) investing activities | 146,504 | (23,823 | ) | 167,853 | 27,053 | |||||
Cash flows used in financing activities | (57,660 | ) | (73,234 | ) | (183,627 | ) | (29,595 | ) | ||
Effect of exchange rate changes on cash and cash equivalents | (2,604 | ) | (6,844 | ) | 260 | 42 | ||||
Net increase/(decrease) in cash and cash equivalents | 112,286 | (103,382 | ) | (15,023 | ) | (2,421 | ) | |||
Cash and cash equivalents at beginning of year | 64,461 | 176,747 | 73,365 | 11,824 | ||||||
Cash and cash equivalents at end of year | 176,747 | 73,365 | 58,342 | 9,403 | ||||||
Subsequent_Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2014 | |
Subsequent Events | |
Subsequent Events | |
22.Subsequent Events | |
a)On February 26, 2015, the Company granted 427,500 restricted shares to one director and certain of its key employees. These restricted shares will vest over a four-year service period, with 25% of the restricted shares subject to vesting on the first anniversary of the date of grant and the remaining 75% subject to vesting in twelve quarterly installments. | |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 12 Months Ended | ||
Dec. 31, 2014 | |||
Summary of Significant Accounting Policies | |||
Basis of presentation and consolidation | |||
a)Basis of presentation and consolidation | |||
The Group’s consolidated financial statements include the financial statements of the Company, its subsidiaries and its VIEs for which the Company is the primary beneficiary. All transactions and balances among the Company, its subsidiaries and its VIEs have been eliminated upon consolidation. The consolidated financial statements have been prepared on a historical cost basis to reflect the financial position and results of operations of the Group in accordance with accounting principles generally accepted in the United States of America (“US GAAP”). | |||
A subsidiary is an entity in which the Company, directly or indirectly, controls more than one half of the voting powers, or has the power to govern the financial and operating policies, to appoint or remove the majority of the members of the board of directors, or to cast a majority of votes at the meeting of directors. | |||
A VIE is an entity in which the Company, or its subsidiary, through contractual agreements, has controlling financial interest of the entity. The Company or its subsidiary is considered to be the primary beneficiary if the Company or its subsidiary has the power to direct the activities that most significantly impact the VIEs’ economic performance and the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. | |||
In determining whether the Company or its subsidiaries are the primary beneficiary of the VIEs, the Company considered whether it has the power to direct activities that are significant to Shanghai HQS, Beijing HQS, Xique, Beijing Aizhenxin and Jiayuan Shanghai Center’s economic performance, including the power to appoint senior management, right to direct company strategy, power to approve capital expenditure budgets, and power to establish and manage ordinary business operation procedures and internal regulations and systems. | |||
There are no entities where the Company has a variable interest but is not the primary beneficiary. | |||
Use of estimates | |||
b)Use of estimates | |||
The preparation of the consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amount of the assets, liabilities, revenues and expenses, and the related disclosure of contingent assets and liabilities. Actual results may differ from those estimates. | |||
Significant accounting estimates reflected in the Group’s consolidated financial statements mainly include the useful lives of property and equipment and intangible assets, impairment assessments for property and equipment, intangible assets, goodwill, investment in equity investee, allowance for doubtful accounts, valuation allowance of deferred tax assets, relative values of revenue elements of service packages, estimation of payments collected by wireless value-added services (“WVAS”) partners and determination of share-based compensation expenses. In addition, the Group uses assumptions in the valuation model to estimate the fair value of share options granted and modified. The Group bases its estimates of the carrying value of certain assets and liabilities on the historical experience and on other various factors that it believes to be reasonable under the circumstances, when the carrying values are not readily available from other sources. | |||
Convenience translation | |||
c)Convenience translation | |||
Translations of balances in the consolidated balance sheets, consolidated statements of comprehensive income and consolidated statements of cash flows from Renminbi (“RMB”) into United States dollars (“US$”) as of and for the year ended December 31, 2014 are solely for the convenience of the reader and were calculated at the rate of US$1.00 =MB6.2046, representing the rate as certified by the H.10 weekly statistical release of Federal Reserve Board on December 31, 2014. No representation is made that the RMB amounts could have been, or could be, converted, realized or settled into US$ at that rate on December 31, 2014, or at any other rate. | |||
Cash and cash equivalents | |||
d)Cash and cash equivalents | |||
Cash and cash equivalents represent cash on hand, demand deposits and highly liquid investments placed with banks, which have original maturities of three months or less and are readily convertible to known amounts of cash. | |||
Term deposits | |||
e)Term deposits | |||
Term deposits represent time deposits placed with banks. Deposits with original maturities of one year or less are reported as current assets while deposits with original maturities of more than one year are reported as non-current assets. Interest earned is recorded as interest income in the consolidated statements of comprehensive income during the periods presented. | |||
Available-for-sale securities | |||
f)Available-for-sale securities | |||
Investments in financial instruments with variable interest rates indexed to the performance of underlying assets are classified as available-for-sale securities. Available-for-sale securities are measured at fair value at the date of initial recognition and subsequently carried at fair value. To estimate fair value, the Group refers to the quoted rate of return provided by banks at the end of each reporting period. Changes in fair value are reflected in the consolidated statement of comprehensive income. Dividend and realized gains and losses upon sale of the available-for-sale securities are recognized as other income. | |||
Accounts receivable and allowance for doubtful accounts | |||
g)Accounts receivable and allowance for doubtful accounts | |||
Accounts receivable mainly represents the amounts due from WVAS partners with whom the Group has entered into agreements for users to purchase the services of the Group and amounts due from offline events sponsors. An allowance for doubtful debts is provided based on an ageing analysis of accounts receivable balances, historical bad debt rates, repayment patterns and credit analysis. The Group also makes a specific allowance if there is evidence showing that the receivable is likely to be irrecoverable, and assesses the probability of recovery on an annual basis. Accounts receivable in the consolidated balance sheet were stated net of such provisions. The allowance for doubtful accounts was RMB110, RMBnil and RMB1,130 for the year ended December 31, 2012, 2013 and 2014, respectively. | |||
Property and equipment | |||
h)Property and equipment | |||
Property and equipment is stated at cost less accumulated depreciation and impairment. Depreciation is provided on a straight-line basis over the following estimated useful lives: | |||
Estimated useful lives | |||
Office building | 30 years | ||
Office building improvements | 10 years | ||
Computer and software | 3 years | ||
Furniture, fixture and other equipment | 3 years | ||
Motor vehicles | 4 years | ||
Leasehold improvements | Shorter of lease term or estimated useful lives of assets | ||
Repairs and maintenance expenditures, which are not considered improvements and do not extend the useful life of the property and equipment, are expensed as incurred. Gains and losses from the disposal of property and equipment are included in income from operations. | |||
Goodwill | |||
i)Goodwill | |||
Goodwill represents the excess of the purchase price over the fair value of the identifiable assets and liabilities acquired as a result of the Group’s business combinations. | |||
In accordance with FASB guidance for goodwill and other intangible assets, goodwill is not amortized but is tested for impairment on an annual basis, or more frequently if events or changes in circumstances indicate that it might be impaired. The Group completes a two-step goodwill impairment test at each year end date. The first step compares the fair values of each reporting unit to its carrying amount, including goodwill. If the fair value of each reporting unit exceeds its carrying amount, goodwill is not considered to be impaired and the second step will not be required. If the carrying amount of a reporting unit exceeds its fair value, the second step compares the implied fair value of goodwill to the carrying value of a reporting unit’s goodwill. The implied fair value of goodwill is determined in a manner similar to accounting for a business combination with the allocation of the assessed fair value reporting unit over the amount assigned to the assets and liabilities. This allocation process is only performed for the purposes of evaluating goodwill impairment and does not result in an entry to adjust the value of any assets or liabilities. An impairment loss is recognized for any excess in the carrying value over the implied fair value of goodwill. | |||
The Group did not incur any impairment loss on goodwill during any of the periods presented. | |||
Intangible assets | |||
j)Intangible assets | |||
Intangible assets consist of acquired intangible assets with finite lives as a result of the Group’s business combination and the acquired domain names, and are carried at cost less accumulated amortization. Amortization is computed using the straight-line method over the following estimated useful lives of the intangible assets: | |||
Estimated useful lives | |||
Trademarks and domain names | 10 years | ||
Customer relationships | 5 years | ||
Source code | 10 years | ||
Impairment of long-lived assets and intangible assets | |||
k)Impairment of long-lived assets and intangible assets | |||
The carrying amount of long-lived assets and intangible assets are reviewed for impairment whenever events or changes in the circumstances indicate that the carrying value of an asset may not be recoverable. The Group assesses the recoverability of the long-lived assets and intangible assets by comparing the carrying amount of assets to the estimated future undiscounted cash flows expected to be generated by the assets. Such assets are considered to be impaired if the sum of the expected undiscounted cash flow is less than the carrying amount of the assets. The impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. No impairment of long-lived assets or intangible assets was recognized for any of the periods presented. | |||
Investment in equity investee | |||
l)Investment in equity investee | |||
Equity investment represents the Group’s investment in a private-owned company. For any equity investment that is not considered as debt security or equity security and that neither has readily determinable fair values nor is considered in-substance common stock, the cost method is used. | |||
Under the cost method, the Group carries the investment at cost and recognizes income to the extent of dividends received from the distribution of the equity investee’s post-acquisition profits. | |||
The Group continually reviews its investment in equity investee to determine whether a decline in fair value below the carrying value is other than temporary. The primary factors the Group considers in its determination are the length of time that the fair value of the investment is below the Group’s carrying value; the financial condition, operating performance and the prospects of the equity investee; and other company specific information such as recent financing rounds. If the decline in fair value is deemed to be other than temporary, the carrying value of the equity investee is written down to fair value. No impairment of investment in equity investee was recognized for the year ended December 31, 2014. | |||
Revenue recognition and deferred revenue | |||
m)Revenue recognition and deferred revenue | |||
Revenue is recognized when persuasive evidence of an arrangement exists, service has been rendered, the price is fixed or determinable and collection is reasonably assured. Revenue is deferred until these criteria are met as described below. | |||
Revenues presented in the consolidated statement of comprehensive income include revenues from online services, personalized matchmaking services, and events and other services. | |||
Online services revenue | |||
The Group offers two types of online services through its online platforms, including message exchanging services and value-added services. Users prepay for virtual currencies that can be used as consideration for the Group’s online services. The Group charges for message exchanging services when one registered user initiates contact with another registered user via the Group’s online platform, and either the sender or recipient may pay for the service. Subsequently, the Group does not charge for any message exchanges between the same two users. Based on the Group’s historical data, the exchange between two users on its online platform typically lasted only a few days. The Group believes that users place the most value on the initial connection, and that users are interested in further interactions after exchanging personal contact information to communicate with each other directly. The Group also offers value-added online services, including sending virtual gifts, improved search rankings and online chatting. | |||
The Group has adopted two primary fee models for the online services: a pay-per-use model and a periodic subscription model. Online services offered under the pay-per-use model include improved search rankings for the duration of one day, message sending or receiving and sending virtual gifts. As the Group provides these services within a short period of time, revenue is recognized when the virtual currencies are used and services are rendered. If the communication patterns of the users change, the timing of the Group’s revenue recognition for these services may be impacted and revenue may be deferred and recognized over a longer period. The Group’s virtual currencies purchased by users that have yet to be used are initially recorded as deferred revenue. | |||
Under the periodic subscription model, users pay a fixed subscription fee for certain services which are delivered over a predetermined subscription period. Online services offered under the subscription model include sending multiple messages a day, reading unlimited number of messages, improved search rankings for a period longer than a day, unlimited online chatting and premium user subscriptions. Fees for subscription services are collected upfront and initially recognized as deferred revenue, and revenue is recognized proportionately over the applicable subscription periods as services are rendered. | |||
The Group’s virtual currencies can be purchased through the Group’s online platform, where the payment is collected through online payment platforms, or through the Group’s WVAS partners. The Group’s WVAS partners offer a payment method by charging services to the customer’s telephone bills, collecting payment from the users and remitting the cash to the Group after payment is collected. Due to the time lag between when the services are rendered and billing statements are provided by the WVAS partners, revenues from the Group’s virtual currencies sold through such channel is estimated based on the Group’s internal billing records and billing confirmations with the WVAS partners. The Group adjusts its revenue recognition for prior periods’ confirmation rates and prior periods’ discrepancies between internally estimated revenues and actual revenues confirmed by the WVAS partners. There were no significant difference between the Group’s estimates and the WVAS partners’ billing statements for all the periods presented. | |||
Revenue from virtual currencies sold through the WVAS partners are recognized on a gross basis as the Group is considered the primary obligor in the arrangements. The Group is also responsible for designing, developing and implementing the online services, and bears credit risks associated with uncollectible fees. In addition, the Group determines the price and the WVAS partners earn only a fixed percentage of commission fees. The amounts attributed to the WVAS partners are determined pursuant to the arrangements between the Group and the WVAS partners, and are recognized as costs of revenues. Such cost of revenues amounted to RMB49,923, RMB61,881 and RMB65,997 for the years ended December 31, 2012, 2013 and 2014, respectively. | |||
The Group also offers web-based games and mobile games under an item-based revenue model, where the basic game play functions are free of charge and players are charged for purchases of in-game virtual items or game points. Revenues of games business are included in online service revenue. | |||
For web-based games, the Group cooperates with third-party game developers by entering into cooperation agreements with them. The web-based games designed, developed and hosted by these developers are made available to the players through the Group’s platforms. The Group views that the developers are primarily responsible for the operation of web-based games to the players. The Group generally collects payments from players in connection with the sale of in-game virtual items and remits certain agreed-upon percentages of the proceeds to the game developers and records revenue net of such remittances. Revenue is recognized when the in-game virtual items are consumed. | |||
For mobile games, the Group is primarily responsible for the operation and sells game points to players through third party mobile application stores. The mobile application stores remit the proceeds to the Group after deducting certain agreed-upon percentages of commission fees. Revenue from the sale of game points is recorded gross of the commission fees paid to mobile application stores and is recognized when the game points are consumed. | |||
Personalized matchmaking services revenue | |||
The Group provides personalized matchmaking services to individual users, which generally consist of unlimited access to certain online services, tickets to a number of events, personalized communications, provision of detailed background checks, dating and relationship consultation and advice and search services provided by the Group’s customer service representatives in a specified contractual period. The Group provides various personalized matchmaking services throughout the contract period on an as-needed basis. When the Group enters into a personalized matchmaking service contract with an individual user, the Group is unable to determine or estimate the volume of each separate service to be provided to the particular user. Different types of services under such personalized bundled contracts are to be provided gradually over the contract period, and as such, the Group accounts for the personalized matchmaking services as a single unit of accounting on a contract basis. Starting from 2013, the Group entered into business arrangements with matchmaking service agencies for providing personalized matchmaking services in the PRC. The Group grants matchmaking service agencies limited rights to use the Group’s brand, trademark and certain resources under the direction of the Group in accordance with the agency agreements. The Group collects upfront payments from the users and remits the commission fees to the matchmaking service agencies at the pre-determined rates pursuant to the agreements between the Group and the matchmaking service agencies. The Group is responsible for the determination of the service scope and price, and the signing of the service agreements and the collection of service fees from customers directly. Revenue from users obtained through matchmaking service agencies are recognized on a gross basis as the Group is considered the primary obligor in the service arrangements. | |||
Payments for personalized matchmaking services are collected upfront and initially recorded as deferred revenue, and revenue is recognized ratably over the contract service period. In addition, there are training fees charged upfront to the matchmaking service agencies, which are recognized as revenue when the training services are rendered. | |||
Contracts for personalized matchmaking services may be terminated at any time at the user’s sole discretion during the contractual period. It is the Group’s policy to refund 80% of the contract payment to the user only if termination takes place within the initial seven days. The Group recognizes all deferred revenue remaining, after deducting the cash refund, if any, from the contract at the time of termination. | |||
Events and other services revenue | |||
The Group earns revenue from organizing and hosting events, including speed-dating, dance parties, and other social events for its users. Speed dating is an organized form of matchmaking that focuses on meeting multiple potential romantic partners over the course of a single event. Tickets are generally sold at the events, and revenue is recognized upon the conclusion of the events when services have been rendered. For certain events where tickets are prepaid by the users, prepaid fees are initially recorded as deferred revenue and revenue is recognized upon the completion of the events. Events services revenue also include the revenue from event sponsorship arrangements whereby third-party companies enter into agreements with the Group to sponsor a particular offline event and the revenue from event sponsorship arrangements are recognized upon the completion of the sponsored event. | |||
Other services revenue mainly represents revenues from online advertising. Revenue from online advertising is principally derived from advertising arrangements that allow advertisers to place advertisements on particular areas of the Group’s websites, in particular formats and over a particular period of time. The Group enters into advertising contracts which are signed to establish the fixed price for the advertising arrangements to be provided, and payment is collected upfront and initially recognized as deferred revenue. Revenues from advertising-related arrangements are recognized on a straight-line basis over the contractual period. | |||
Customer loyalty program | |||
n)Customer loyalty program | |||
Registered users earned loyalty points based on their activities on the Group’s platform and/or purchase of online services, which could be used to redeem online services once a minimum number of points had been accumulated. The Group considered loyalty points awarded for the purchase of online services to be part of its revenue generating activities, and such arrangements were considered to have multiple elements. Under the applicable guidance, total consideration was allocated to the purchased services and loyalty points based on the relative selling price of the purchased services and redeemable services. In determining the best estimated selling price of each loyalty point, the Group considered the selling price of the underlying services if they were not redeemed using loyalty points and the average number of loyalty points needed to redeem each type of service. Consideration allocated to the loyalty points was initially recorded as deferred revenue, and revenue was recognized when the points were redeemed and services were rendered. In 2013, the Group suspended the customer loyalty program. All the loyalty points expired in 2013 and the Group recognized the deferred revenue accordingly. | |||
For the years ended December 31, 2012, 2013 and 2014, revenue recognized from loyalty points amounted to RMBnil, RMB4,917 and RMBnil, respectively. All the loyalty points expired in 2013 and the deferred revenue balance in relation to the customer loyalty program amounted to RMBnil as of December 31, 2013 and thereafter. | |||
Cost of revenues | |||
o)Cost of revenues | |||
Cost of revenues primarily consists of commission fees paid to the WVAS partners for money collection, salaries and wages, network costs, depreciation of property and equipment, rental expenses of premises and facilities and commission fees paid to personalized matchmaking service agencies. | |||
Share-based compensation | |||
p)Share-based compensation | |||
The Company grants share options and restricted shares to eligible employees and directors under a share incentive plan. The awards are measured at the grant date fair value and are recognized as an expense using the graded vesting method, net of estimated forfeiture rate. The Company recognizes awards with service condition terms only over the requisite service period, which is generally the vesting period. | |||
Income taxes | |||
q)Income taxes | |||
Income taxes are accounted for under the asset and liability method. Deferred income taxes are accounted for using an asset and liability approach which requires the recognition of income taxes payable or refundable for the current year. Deferred tax liabilities and assets for the future tax consequences of events are also recognized in the Group’s financial statements or tax returns. | |||
Deferred income taxes are determined based on the differences between the financial reporting and tax basis of assets and liabilities and are measured using the currently enacted tax rates and laws. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the consolidated statements of comprehensive income in the period that includes the enactment date. A valuation allowance is provided to reduce the carrying amount of deferred tax assets if it is considered more likely than not that some portion, or all, of the deferred tax assets will not be realized. | |||
The PRC tax regulations impose a 10% withholding income tax for dividends distributed by foreign invested enterprises to their immediate holding companies outside the PRC. 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. A holding company in Hong Kong, for example, will be subject to a 5% withholding tax rate under the Arrangement Between the PRC and Hong Kong on the Avoidance of Double Taxation and Prevention of Fiscal Evasion with Respect to Taxes on Income and Capital if such holding company is considered a non-PRC resident enterprise and holds at least 25% of the equity interests in the PRC foreign invested enterprise distributing the dividends, subject to approval of the PRC local tax authority. However, if the Hong Kong holding company is not considered to be the beneficial owner of such dividends under applicable PRC tax regulations, such dividend will remain subject to a withholding tax rate of 10%. | |||
The guidance on accounting for uncertainties in income taxes 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. Guidance was also provided 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. Significant judgment is required in evaluating the Group’s uncertain tax positions and determining its provision for income taxes. The Group recognizes interests and penalties, if any, under accrued expenses and other current liabilities on its balance sheet and under other expenses in its statement of comprehensive income. The Group did not recognize any significant interest and penalties associated with uncertain tax positions for the years ended December 31, 2012, 2013 and 2014. As of December 31, 2014, the Group did not have any significant unrecognized uncertain tax positions. | |||
Employee benefit expenses | |||
r)Employee benefit expenses | |||
All eligible employees of the Group are entitled to staff welfare benefits including medical care, welfare subsidies, unemployment insurance and pension benefits through a PRC government-mandated multi-employer defined contribution plan. The Group is required to accrue for these benefits based on certain percentages of the qualified employees’ salaries. The Group is required to make contributions to the plans out of the amounts accrued. The PRC government is responsible for the medical benefits and the pension liability to be paid to these employees and the Group’s obligations are limited to the amounts contributed. The Group has no further payment obligations once the contributions have been paid. | |||
The Group recorded employee benefit expenses of RMB14,005, RMB17,568 and RMB20,553 for the years ended December 31, 2012 and 2013 and 2014, respectively. | |||
Statutory reserves | |||
s)Statutory reserves | |||
The Group’s subsidiaries, VIEs and VIE’s subsidiary established in the PRC are required to make appropriations to certain non-distributable reserve funds. | |||
In accordance with the laws applicable to China’s Foreign Investment Enterprises, the Group’s subsidiaries registered as wholly-owned foreign enterprise has to make appropriations from its after-tax profit (as determined under the Accounting Standards for Business Enterprises as promulgated by the Ministry of Finance of the People’s Republic of China (“PRC GAAP”)) to reserve funds including general reserve fund, and staff bonus and welfare fund. | |||
The appropriation to the general reserve fund must be at least 10% of the after-tax profits calculated in accordance with PRC GAAP. Appropriation is not required if the reserve fund has reached 50% of the registered capital of the company. Appropriation to the staff bonus and welfare fund is at the company’s discretion. | |||
In addition, in accordance with the China Company Laws, the VIEs of the Company registered as a PRC domestic company must make appropriations from its after-tax profit as determined under the PRC GAAP to non-distributable reserve funds including a statutory surplus fund and a discretionary surplus fund. The appropriation to the statutory surplus fund must be at least 10% of the after-tax profits as determined under PRC GAAP. Appropriation is not required if the surplus fund has reached 50% of the registered capital of the company. Appropriation to the discretionary surplus fund is made at the discretion of the company. | |||
The use of the general reserve fund, statutory surplus fund and discretionary surplus fund are restricted to the offsetting of losses or increases the registered capital of the respective company. The staff bonus and welfare fund is a liability in nature and is restricted to fund payments of special bonus to staff and for the collective welfare of employees. All these reserves are not allowed to be transferred to the Company in terms of cash dividends, loans or advances, nor can they be distributed except under liquidation. | |||
For the years ended December 31, 2012, 2013 and 2014, RMB3,710, RMB472 and RMB129 were appropriated to the statutory reserves, respectively. | |||
Research and development costs | |||
t)Research and development costs | |||
Research and development costs include expenses incurred by the Company to develop, maintain and manage the Company’s platforms. These expenses are mainly comprised of salaries, employee benefits and other headcount-related costs associated with the research and development department. The Company expenses all costs that are incurred in connection with the planning and implementation phases of development and costs that are associated with repair and maintenance of the existing platforms. Costs incurred in the development phase are capitalized and amortized over the estimated product life. | |||
During the periods presented, the amount of costs qualifying for capitalization was not significant and as a result, the Group expensed all research and development costs as incurred. | |||
Advertising expenses | |||
u)Advertising expenses | |||
Advertising expenses, which generally reflect the cost of promotions to create or stimulate a positive image of the Group or a desire to obtain the Group’s services, are expensed as incurred. Advertising costs included in selling and marketing expense were RMB69,966, RMB71,498 and RMB105,636 for the years ended December 31, 2012, 2013 and 2014, respectively. | |||
Operating lease | |||
v)Operating lease | |||
Leases where substantially all the risks and rewards of ownership of the assets remain with the lessor are accounted for as operating leases. Payments made under operating leases are charged to the consolidated statements of comprehensive income on a straight line basis over the lease periods. | |||
Government subsidies | |||
w)Government subsidies | |||
Government subsidies represent discretionary cash subsidies granted by the local government to encourage the development of certain enterprises that are established in the local economic region. The cash subsidies are recognized as other income when there is reasonable assurance that the grant will be received and the Group will comply with all attached conditions. | |||
Foreign currency translation | |||
x)Foreign currency translation | |||
The Group uses the RMB as its reporting currency. The functional currency of the Company and its subsidiaries incorporated in the British Virgin Islands and Hong Kong is the US$, while the functional currency of the Group’s other subsidiaries, VIEs and VIE’s subsidiary incorporated and operated in the PRC is the RMB. | |||
In the consolidated financial statements, the financial information of the Company and its subsidiaries which use US$ as their functional currency, has been translated into RMB. Assets and liabilities are translated from each subsidiary’s functional currency at the exchange rates on the balance sheet date, equity amounts are translated at historical exchange rates, and revenues, expenses, gains, and losses are translated using the average rate for the year. Gains and losses resulting from foreign currency translation to reporting currency are recorded in accumulated other comprehensive income in the consolidated statements of comprehensive income for the years presented. | |||
Net income per share and per American Depository Share ("ADS") | |||
y)Net income per share and per American Depository Share (“ADS”) | |||
Basic net income per share is computed by dividing net income by the weighted average number of ordinary shares outstanding during the year. Diluted net income per share is calculated by dividing net income attributable to ordinary 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. Ordinary equivalent shares consist of non-vested restricted shares and shares issuable upon the exercise of stock options (using the treasury stock method). Ordinary equivalent shares are not included in the denominator of the diluted net income per share calculation when inclusion of such shares would be anti-dilutive. | |||
Basic and diluted net income per ADS is computed based on net income and the corresponding basic and diluted number of ADSs, assuming that, during each period presented, every two ADSs represent three ordinary shares of the Company. | |||
Comprehensive income | |||
z)Comprehensive income | |||
Comprehensive income is defined as the change in equity of a company during a period from transactions and other events and circumstances excluding those resulting from investments by shareholders and distributions to shareholders. Accumulated other comprehensive income, as presented on the accompanying consolidated balance sheets, consists of the accumulated foreign currency translation adjustments. | |||
Recent accounting pronouncements | |||
aa)Recent accounting pronouncements | |||
On May 28, 2014, the FASB and IASB issued their converged standard on the recognition of revenue from contracts with customers. The standard is intended to improve the financial reporting of revenue and improve comparability of the top line in financial statements globally. The FASB is amending the FASB Accounting Standards Codification and creating a new Topic 606, Revenue from Contracts with Customers, to supersede the revenue recognition requirements in Topic 605, Revenue Recognition, and most industry-specific guidance throughout the Industry Topics of the Codification. Additionally, the amendments supersede some cost guidance included in Subtopic 605-35, Revenue Recognition—Construction-Type and Production-Type Contracts. For a public entity, the amendments are effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. Early application is not permitted. The Group is currently evaluating the impact on its consolidated financial statements of adopting this guidance. | |||
In June 2014, under ASC 718, Compensation—Stock Compensation, the FASB issued Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period. These amendments apply to all reporting entities that grant their employees share-based payments in which the terms of the award provide that a performance target that affects vesting could be achieved after the requisite service period. That is the case when an employee is eligible to retire or otherwise terminate employment before the end of the period in which a performance target could be achieved and still be eligible to vest in the award if and when the performance target is achieved. For all entities, the amendments are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. The Group is currently evaluating the impact on its consolidated financial statements of adopting this guidance. | |||
In August 2014, the FASB issued Presentation of Financial Statements — Going Concern. This standard requires management to evaluate for each annual and interim reporting period whether it is probable that the reporting entity will not be able to meet its obligations as they become due within one year after the date that the financial statements are issued. If the entity is in such a position, the standard provides for certain disclosures depending on whether or not the entity will be able to successfully mitigate its going concern status. This guidance is effective for annual periods ending after December 15, 2016 and interim periods within annual periods beginning after December 15, 2016. Early application is permitted. The Group does not anticipate that this adoption will have a significant impact on its financial position, results of operations, or cash flows. | |||
Principal_Activities_and_Organ1
Principal Activities and Organization (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Principal Activities and Organization | |||||||||
Schedule of Company's subsidiaries, VIEs and VIE's subsidiary | |||||||||
As of December 31, 2014, the Company’s subsidiaries, VIEs and VIE’s subsidiary included the following entities: | |||||||||
Name | Date of | Place of | Percentage of | Principal | |||||
incorporation or | incorporation | direct or | activities | ||||||
establishment | or establishment | indirect | |||||||
/operations | economic | ||||||||
ownership | |||||||||
Subsidiaries | |||||||||
Harper Capital Inc. (“BVI Company”) | February 6, 2007 | British Virgin Islands | 100 | % | Investment holding | ||||
Miyuan (Shanghai) Information Technology Co., Ltd. (“Shanghai Miyuan”) | April 27, 2007 | PRC | 100 | % | Investment holding and consulting services | ||||
Jiayuan Hong Kong Corporation Limited (“Jiayuan Hong Kong”) | October 5, 2010 | Hong Kong | 100 | % | Investment holding and overseas online dating services | ||||
Beijing Miyuan Information Technology Co., Ltd. (“Beijing Miyuan”) | January 26, 2011 | PRC | 100 | % | Investment holding and consulting services | ||||
Variable interest entities (“VIEs”) | |||||||||
Shanghai Huaqianshu Information Technology Co., Ltd. (“Shanghai HQS”) | April 6, 2004 | PRC | 100 | % | Online dating services | ||||
Beijing Huaqianshu Information Technology Co., Ltd. (“Beijing HQS”) | November 26, 2010 | PRC | 100 | % | Online dating services and personalized matchmaking services | ||||
Beijing Shiji Xique Information Technology Co., Ltd. (“Xique”) | November 26, 2010 | PRC | 100 | % | Online wedding planning services | ||||
Beijing Aizhenxin Information Technology Co., Ltd. (“Beijing Aizhenxin”) | August 13, 2012 | PRC | 100 | % | Online dating services | ||||
VIE’s subsidiary | |||||||||
Shiji Jiayuan Matchmaking Services Center (“Jiayuan Shanghai Center”) | December 3, 2010 | PRC | 100 | % | Events and personalized matchmaking services | ||||
Summary_of_Significant_Account2
Summary of Significant Accounting Policies (Tables) | 12 Months Ended | ||
Dec. 31, 2014 | |||
Summary of Significant Accounting Policies | |||
Schedule of estimated useful lives of assets | |||
Estimated useful lives | |||
Office building | 30 years | ||
Office building improvements | 10 years | ||
Computer and software | 3 years | ||
Furniture, fixture and other equipment | 3 years | ||
Motor vehicles | 4 years | ||
Leasehold improvements | Shorter of lease term or estimated useful lives of assets | ||
Schedule of estimated useful lives of the intangible assets | |||
Estimated useful lives | |||
Trademarks and domain names | 10 years | ||
Customer relationships | 5 years | ||
Source code | 10 years | ||
Concentration_Credit_and_Other1
Concentration, Credit and Other Risks (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Concentration, Credit and Other Risks | ||||||||
Schedule of combined financial information of the Group's VIEs and VIE's subsidiary | ||||||||
As of December 31, | ||||||||
2013 | 2014 | |||||||
RMB | RMB | |||||||
Total assets | 501,281 | 633,177 | ||||||
Total liabilities | 312,572 | 409,772 | ||||||
Payable to third parties | 189,803 | 270,533 | ||||||
Payable to Group entities | 122,769 | 139,239 | ||||||
For the year ended December 31, | ||||||||
2012 | 2013 | 2014 | ||||||
RMB | RMB | RMB | ||||||
Net revenue | 411,084 | 492,799 | 614,239 | |||||
Net income | 23,038 | 61,608 | 25,133 | |||||
Inter-company service fees paid/payable | 43,446 | 9,278 | 11,615 | |||||
For the year ended December 31, | ||||||||
2012 | 2013 | 2014 | ||||||
RMB | RMB | RMB | ||||||
Net cash provided by operating activities | 54,966 | 151,318 | 90,925 | |||||
Net cash used in investing activities | (67,544 | ) | (87,916 | ) | (97,104 | ) | ||
Effect of exchange rate changes on cash and cash equivalents | (11 | ) | (180 | ) | 134 | |||
Net (decrease)/increase in cash and cash equivalents | (12,589 | ) | 63,222 | (6,045 | ) | |||
Schedule of the carrying values of property and equipment, intangible assets and goodwill of VIEs | ||||||||
As of December 31, | ||||||||
2013 | 2014 | |||||||
RMB | RMB | |||||||
Property and equipment, net | 99,296 | 91,208 | ||||||
Intangible assets, net | 4,275 | 3,610 | ||||||
Goodwill | 789 | 789 | ||||||
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 12 Months Ended | |||||||||
Dec. 31, 2014 | ||||||||||
Fair Value Measurements | ||||||||||
Schedule of fair value of assets measured on recurring basis | ||||||||||
Fair value measurements at reporting date using | ||||||||||
Quoted prices in | ||||||||||
Total fair value | active market | Significant other | Significant | |||||||
and carrying value | for identical | observable | unobservable | |||||||
on balance sheet | assets (Level 1) | inputs (Level 2) | inputs (Level 3) | |||||||
RMB | RMB | RMB | RMB | |||||||
As of December 31, 2013 | ||||||||||
Cash equivalents | 232,458 | — | 232,458 | — | ||||||
Short-term deposits | 336,299 | — | 336,299 | — | ||||||
Available-for-sale securities | 5,233 | — | 5,233 | — | ||||||
As of December 31, 2014 | ||||||||||
Cash equivalents | 196,810 | — | 196,810 | — | ||||||
Short-term deposits | 239,466 | — | 239,466 | — | ||||||
Available-for-sale securities | 15,715 | — | 15,715 | — | ||||||
Accounts_Receivable_net_Tables
Accounts Receivable, net (Tables) | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Accounts Receivable, net | ||||||
Summary of Group's accounts receivable | ||||||
As of December 31, | ||||||
2013 | 2014 | |||||
RMB | RMB | |||||
Accounts receivable | 33,987 | 38,875 | ||||
Less: Allowance for doubtful accounts | — | (1,130 | ) | |||
Accounts receivable, net | 33,987 | 37,745 | ||||
Schedule of changes in allowance for doubtful accounts | ||||||
2013 | 2014 | |||||
RMB | RMB | |||||
Balance as of January 1 | 110 | — | ||||
Provision of bad debt | — | 2,364 | ||||
Write-off of bad debt | (110 | ) | (1,234 | ) | ||
Balance as of December 31 | — | 1,130 | ||||
Prepaid_Expenses_and_Other_Cur1
Prepaid Expenses and Other Current Assets (Tables) | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Prepaid Expenses and Other Current Assets | ||||||
Schedule of prepaid expenses and other current assets | ||||||
As of December 31, | ||||||
2013 | 2014 | |||||
RMB | RMB | |||||
Prepaid commission to matchmaking service agencies | 6,172 | 45,915 | ||||
Prepaid expenses-other | 6,659 | 7,235 | ||||
Advances to employees | 2,761 | 4,014 | ||||
Interest receivables | 4,782 | 2,417 | ||||
Rental and other deposits | 2,781 | 3,653 | ||||
Inventory | — | 1,553 | ||||
Others | 540 | 1,714 | ||||
23,695 | 66,501 | |||||
Property_and_Equipment_net_Tab
Property and Equipment, net (Tables) | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Property and Equipment, net | ||||||
Schedule of property and equipment, net | ||||||
As of December 31, | ||||||
2013 | 2014 | |||||
RMB | RMB | |||||
Office buildings | 77,797 | 77,797 | ||||
Office buildings improvements | 3,884 | 3,948 | ||||
Computer and software | 54,271 | 56,942 | ||||
Furniture, fixture and other equipment | 4,544 | 4,960 | ||||
Motor vehicles | 407 | 407 | ||||
Leasehold improvements | 3,296 | 4,254 | ||||
144,199 | 148,308 | |||||
Less: accumulated depreciation and amortization | (44,715 | ) | (56,614 | ) | ||
Property and equipment, net | 99,484 | 91,694 | ||||
Business_Combination_Tables
Business Combination (Tables) | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Business Combination | ||||
Schedule of recognized amounts of the identifiable assets | ||||
As of December 10, 2012 | ||||
RMB | ||||
Identifiable intangible assets: | ||||
Brand name | 2,141 | |||
Customer relationships | 1,637 | |||
Source code | 933 | |||
Identifiable assets acquired | 4,711 | |||
Goodwill | 789 | |||
Cash consideration | 5,500 | |||
Intangible_assets_net_Tables
Intangible assets, net (Tables) | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Intangible assets, net | ||||||
Summary of the Company's intangible assets, net | ||||||
As of December 31, | ||||||
2013 | 2014 | |||||
RMB | RMB | |||||
Brand name | 2,141 | 2,141 | ||||
Customer relationships | 1,637 | 1,637 | ||||
Source code | 933 | 933 | ||||
Domain names | 305 | 305 | ||||
5,016 | 5,016 | |||||
Less: accumulated amortization | (741 | ) | (1,406 | ) | ||
Intangible assets, net | 4,275 | 3,610 | ||||
Schedule of amortization expenses for future periods | ||||||
As of December 31, 2014, amortization expenses for future periods are estimated as follows: | ||||||
For the year ended December 31, | Amortization expenses | |||||
RMB | ||||||
2015 | 665 | |||||
2016 | 665 | |||||
2017 | 612 | |||||
2018 | 338 | |||||
2019 | 338 | |||||
Thereafter | 992 | |||||
Total | 3,610 | |||||
Accrued_Expenses_and_Other_Lia1
Accrued Expenses and Other Liabilities (Tables) | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Accrued Expenses and Other Liabilities | ||||||
Accrued expenses and other liabilities | ||||||
As of December 31, | ||||||
2013 | 2014 | |||||
RMB | RMB | |||||
Accrued salaries and welfare | 19,740 | 17,964 | ||||
Accrued advertising expenses | 2,371 | 2,388 | ||||
Accrued network support expenses | 1,908 | 1,801 | ||||
Business and other tax payable | 3,304 | 4,093 | ||||
Professional and other service fees | 6,556 | 9,262 | ||||
Deposits received from matchmaking service agencies | 2,850 | 8,980 | ||||
Others | 5,616 | 6,652 | ||||
Balance as at December 31 | 42,345 | 51,140 | ||||
Less: Current portion | 39,615 | 45,490 | ||||
Non-current portion | 2,730 | 5,650 | ||||
Taxation_Tables
Taxation (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Taxation | ||||||||
Schedule of current and deferred portions of income tax expenses | ||||||||
For the year ended December 31, | ||||||||
2012 | 2013 | 2014 | ||||||
RMB | RMB | RMB | ||||||
Current tax expenses | 8,753 | 9,520 | 6,434 | |||||
Deferred taxation | 474 | 3,533 | (3,427 | ) | ||||
Income tax expenses | 9,227 | 13,053 | 3,007 | |||||
Schedule of reconciliation of the differences between the PRC statutory EIT rate | ||||||||
For the year ended December 31, | ||||||||
2012 | 2013 | 2014 | ||||||
RMB | RMB | RMB | ||||||
Statutory EIT rate | 25.0 | % | 25.0 | % | 25.0 | % | ||
Effect of non-deductible expenses | 4.9 | % | 2.6 | % | 7.9 | % | ||
Effect of lower tax rates in other jurisdictions | 0.3 | % | (0.8 | )% | 0.3 | % | ||
Effect of preferential tax treatments | (19.2 | )% | (15.0 | )% | (19.3 | )% | ||
Tax incentives for research and development expenses (i) | (3.1 | )% | (3.9 | )% | (7.2 | )% | ||
Withholding income tax for dividends | — | 6.0 | % | 8.3 | % | |||
Changes in valuation allowance: | 5.6 | % | 3.1 | % | (2.0 | )% | ||
- Unrecognized tax losses | 1.7 | % | 1.7 | % | 1.8 | % | ||
- Accrued salaries and other expenses | 0.2 | % | — | (1.2 | )% | |||
- Advertising expenses | 3.7 | % | 1.4 | % | (3.8 | )% | ||
- Doubtful accounts | — | — | 1.2 | % | ||||
Effective income tax rate | 13.5 | % | 17.0 | % | 13.0 | % | ||
(i) | The Group obtained a tax incentive relating to research and development expense of one of its VIEs in the PRC. Under such tax incentive rule, the Group may claim an additional tax deduction amounting to 50% of the research and development expenses incurred in a year. | |||||||
Schedule of the effect of preferential tax treatments on earnings | ||||||||
For the year ended December 31, | ||||||||
2012 | 2013 | 2014 | ||||||
RMB | RMB | RMB | ||||||
Preferential tax treatments impact to net income to ordinary shareholders | 15,201 | 14,498 | 6,125 | |||||
Per share effect, basic | 0.33 | 0.32 | 0.14 | |||||
Per share effect, diluted | 0.32 | 0.32 | 0.13 | |||||
Schedule of significant components of entity's deferred tax assets | ||||||||
As of December 31, | ||||||||
2013 | 2014 | |||||||
RMB | RMB | |||||||
Deferred tax assets, current | ||||||||
Net operating loss carry forwards | 4,365 | 6,565 | ||||||
Accrued salaries and other expenses | 3,391 | 3,329 | ||||||
Advertising expenses | 15,214 | 18,799 | ||||||
Government subsidies | 333 | 169 | ||||||
Other | 188 | 616 | ||||||
Total deferred tax assets, current | 23,491 | 29,478 | ||||||
Deferred tax assets, non-current | — | — | ||||||
Total deferred tax assets | 23,491 | 29,478 | ||||||
Less: valuation allowance | ||||||||
Net operating loss carry forwards | (4,365 | ) | (4,667 | ) | ||||
Accrued salaries and other expenses | (284 | ) | — | |||||
Advertising expenses | (15,214 | ) | (15,448 | ) | ||||
Other | — | (381 | ) | |||||
Total valuation allowance | (19,863 | ) | (20,496 | ) | ||||
Net deferred tax assets | 3,628 | 8,982 | ||||||
Deferred tax liabilities, non-current | ||||||||
Withholding income tax for dividends | 4,590 | 6,517 | ||||||
Schedule of the movements of valuation allowance | ||||||||
Years Ended December 31, | ||||||||
2012 | 2013 | 2014 | ||||||
RMB | RMB | RMB | ||||||
Balance at beginning of the year | (13,652 | ) | (17,315 | ) | (19,863 | ) | ||
Change in valuation allowance | (3,663 | ) | (2,548 | ) | (633 | ) | ||
Balance at end of the year | (17,315 | ) | (19,863 | ) | (20,496 | ) | ||
Sharebased_Compensation_Tables
Share-based Compensation (Tables) | 12 Months Ended | |||||||||
Dec. 31, 2014 | ||||||||||
Share-based Compensation | ||||||||||
Schedule of the Company's share option activities | ||||||||||
Share options outstanding | ||||||||||
Share | Weighted | Weighted | Weighted | |||||||
options | average | average | average | |||||||
exercise | remaining | grant | ||||||||
price | contractual | date fair | ||||||||
life | value | |||||||||
(in years) | ||||||||||
US$ | US$ | |||||||||
Balances outstanding at January 1, 2012 | 4,382,636 | 2.78 | 4.23 | 1.57 | ||||||
Granted | 2,410,000 | 3.35 | 1.26 | |||||||
Exercised | (913,801 | ) | 1.05 | 0.9 | ||||||
Modified | (290,547 | ) | 3.23 | 1.06 | ||||||
Forfeited | (1,169,906 | ) | 4.35 | 1.95 | ||||||
Expired | (50,000 | ) | 0.3 | 0.02 | ||||||
Balances outstanding at December 31, 2012 | 4,368,382 | 2.69 | 4.34 | 1.3 | ||||||
Granted | 90,000 | 4.61 | 1.15 | |||||||
Exercised | (981,992 | ) | 1.33 | 1.32 | ||||||
Forfeited | (291,915 | ) | 3.87 | 1.37 | ||||||
Expired | (50,000 | ) | 0.3 | 0.05 | ||||||
Balances outstanding at December 31, 2013 | 3,134,475 | 3.1 | 3.98 | 1.31 | ||||||
Granted | 457,500 | 3.71 | 1.22 | |||||||
Exercised | (642,058 | ) | 2 | 1.09 | ||||||
Forfeited | (173,462 | ) | 3.41 | 1.28 | ||||||
Balances outstanding at December 31, 2014 | 2,776,455 | 3.02 | 3.65 | 1.3 | ||||||
Exercisable at December 31, 2012 | 1,353,698 | 1.4 | 2.39 | 1.24 | ||||||
Exercisable at December 31, 2013 | 1,357,529 | 2.75 | 3.4 | 1.31 | ||||||
Exercisable at December 31, 2014 | 1,373,002 | 2.82 | 3.15 | 1.36 | ||||||
Summary of the assumptions used to estimate the fair values of the share options granted | ||||||||||
For the year ended December 31, | ||||||||||
2012 | 2013 | 2014 | ||||||||
Risk-free interest rate | 1.30%-2.25% | 2.05% | 2.70% | |||||||
Exercise multiple | 2.80 | 2.80 | 2.80 | |||||||
Expected forfeiture rate | 5% | 5% | 5% | |||||||
Contractual life of option | 6 years | 6 years | 6 years | |||||||
Expected volatility | 38.00%-38.88% | 39.00% | 45.00% | |||||||
Dividend yield | — | 5% | 4% | |||||||
Summary of Restricted Shares activities | ||||||||||
Restricted Shares outstanding | ||||||||||
Restricted Shares | Weighted average | |||||||||
remaining contractual life | ||||||||||
(in years) | ||||||||||
Balances outstanding at December 31, 2012 | 281,540 | 5.34 | ||||||||
Granted | 34,286 | |||||||||
Forfeited | (2,885 | ) | ||||||||
Balances outstanding at December 31, 2013 | 312,941 | 4.49 | ||||||||
Granted | 486,000 | |||||||||
Exercised | (5,211 | ) | ||||||||
Forfeited | (13,623 | ) | ||||||||
Balances outstanding at December 31, 2014 | 780,107 | 4.73 | ||||||||
Net_Income_Per_Share_Tables
Net Income Per Share (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Net Income Per Share | ||||||||
Schedule of basic and diluted net income per share | ||||||||
For the year ended December 31, | ||||||||
2012 | 2013 | 2014 | ||||||
RMB | RMB | RMB | ||||||
Numerator: | ||||||||
Net income | 58,937 | 63,656 | 20,107 | |||||
Denominator: | ||||||||
Weighted average number of ordinary shares outstanding—basic | 46,297,314 | 44,910,676 | 44,423,885 | |||||
Dilutive effect of share options | 1,445,784 | 917,246 | 966,924 | |||||
Weighted average number of ordinary shares outstanding—diluted | 47,743,098 | 45,827,922 | 45,390,809 | |||||
Basic net income per share | 1.27 | 1.42 | 0.45 | |||||
Diluted net income per share | 1.23 | 1.39 | 0.44 | |||||
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Commitments and Contingencies | ||||
Schedule of future minimum payments under non-cancellable operating leases with initial terms in excess of one year | ||||
Future minimum payments under non-cancellable operating leases with initial terms in excess of one year consist of the following at December 31, 2014: | ||||
Amount | ||||
RMB | ||||
Year ending December 31, | ||||
2015 | 8,463 | |||
2016 | 5,382 | |||
2017 | 450 | |||
2018 and thereafter | — | |||
Total | 14,295 | |||
Related_Party_Transactions_Tab
Related Party Transactions (Tables) | 12 Months Ended | ||
Dec. 31, 2014 | |||
Related Party Transactions | |||
Schedule of the amounts due from/to a related party | |||
Related Party | Relationship with the Group | ||
Ms. Haiyan Gong (Note) | Nominee shareholder of the VIEs, non-executive co-chairman of the Board of Directors, and the Company’s shareholder. | ||
Mr. JP Gan | Member of the Board of Directors and Compensation Committee, and the chairman of Company’s Nominating and Corporate Governance Committee. | ||
Segment_Information_Tables
Segment Information (Tables) | 12 Months Ended | |||||||||
Dec. 31, 2014 | ||||||||||
Segment Information | ||||||||||
Schedule of information for net revenue, cost of revenues and gross profit | ||||||||||
For the year ended December 31, 2012 | ||||||||||
Online services | Personalized | Events and other | Consolidated | |||||||
matchmaking | services | |||||||||
services | ||||||||||
RMB | RMB | RMB | RMB | |||||||
Net revenues | 362,492 | 33,143 | 15,168 | 410,803 | ||||||
Cost of revenues | (117,830 | ) | (15,903 | ) | (9,952 | ) | (143,685 | ) | ||
Gross profit | 244,662 | 17,240 | 5,216 | 267,118 | ||||||
For the year ended December 31, 2013 | ||||||||||
Online services | Personalized | Events and other | Consolidated | |||||||
matchmaking | services | |||||||||
services | ||||||||||
RMB | RMB | RMB | RMB | |||||||
Net revenues | 422,088 | 52,458 | 18,060 | 492,606 | ||||||
Cost of revenues | (140,975 | ) | (29,792 | ) | (9,754 | ) | (180,521 | ) | ||
Gross profit | 281,113 | 22,666 | 8,306 | 312,085 | ||||||
For the year ended December 31, 2014 | ||||||||||
Online services | Personalized | Events and other | Consolidated | |||||||
matchmaking | services | |||||||||
services | ||||||||||
RMB | RMB | RMB | RMB | |||||||
Net revenues | 425,544 | 164,598 | 23,848 | 613,990 | ||||||
Cost of revenues | (148,811 | ) | (117,054 | ) | (11,924 | ) | (277,789 | ) | ||
Gross profit | 276,733 | 47,544 | 11,924 | 336,201 | ||||||
Restricted_Net_Assets_Tables
Restricted Net Assets (Tables) | 12 Months Ended | |||||||||
Dec. 31, 2014 | ||||||||||
Restricted Net Assets | ||||||||||
FINANCIAL INFORMATION OF PARENT COMPANY CONDENSED BALANCE SHEETS | FINANCIAL INFORMATION OF PARENT COMPANY | |||||||||
CONDENSED BALANCE SHEETS | ||||||||||
AS OF DECEMBER 31, 2013 AND 2014 | ||||||||||
(All amounts in thousands) | ||||||||||
As of December 31, | ||||||||||
2013 | 2014 | 2014 | ||||||||
RMB | RMB | US$ | ||||||||
ASSETS | ||||||||||
Current assets: | ||||||||||
Cash and cash equivalents | 73,365 | 58,342 | 9,403 | |||||||
Short-term deposits | 177,319 | 9,466 | 1,526 | |||||||
Prepaid expenses and other current assets | 8,000 | 7,955 | 1,282 | |||||||
Total current assets | 258,684 | 75,763 | 12,211 | |||||||
Non-current assets: | ||||||||||
Investments in subsidiaries and VIEs | 286,455 | 316,253 | 50,971 | |||||||
Total assets | 545,139 | 392,016 | 63,182 | |||||||
LIABILITIES | ||||||||||
Current liabilities: | ||||||||||
Accrued expenses and other current liabilities, current portion | 5,921 | 4,976 | 802 | |||||||
Total current liabilities | 5,921 | 4,976 | 802 | |||||||
Total liabilities | 5,921 | 4,976 | 802 | |||||||
SHAREHOLDERS’ EQUITY | ||||||||||
Ordinary shares (US$0.001 par value; 100,000,000 shares authorized as of December 31, 2013 and 2014; 49,030,944 shares issued and outstanding as of December 31, 2013; 49,930,944 shares issued and outstanding as of December 31, 2014) | 349 | 354 | 57 | |||||||
Additional paid-in capital | 506,458 | 358,768 | 57,823 | |||||||
Less: Treasury shares (4,145,729 and 5,310,240 shares as of December 31, 2013 and 2014, respectively) | (91,100 | ) | (117,480 | ) | (18,934 | ) | ||||
Statutory reserves | 9,974 | 10,103 | 1,628 | |||||||
Retained earnings | 126,367 | 146,345 | 23,587 | |||||||
Accumulated other comprehensive loss | (12,830 | ) | (11,050 | ) | (1,781 | ) | ||||
Total shareholders’ equity | 539,218 | 387,040 | 62,380 | |||||||
Total liabilities and shareholders’ equity | 545,139 | 392,016 | 63,182 | |||||||
FINANCIAL INFORMATION OF PARENT COMPANY CONDENSED STATEMENTS OF COMPREHENSIVE INCOME | ||||||||||
FINANCIAL INFORMATION OF PARENT COMPANY | ||||||||||
CONDENSED STATEMENTS OF COMPREHENSIVE INCOME | ||||||||||
FOR THE YEARS ENDED DECEMBER 31, 2012, 2013 AND 2014 | ||||||||||
(All amounts in thousands) | ||||||||||
For the Year Ended December 31, | ||||||||||
2012 | 2013 | 2014 | 2014 | |||||||
RMB | RMB | RMB | US$ | |||||||
Operating expenses: | ||||||||||
General and administrative expenses | (6,443 | ) | (4,461 | ) | (3,369 | ) | (543 | ) | ||
Total operating expenses | (6,443 | ) | (4,461 | ) | (3,369 | ) | (543 | ) | ||
Operating loss | (6,443 | ) | (4,461 | ) | (3,369 | ) | (543 | ) | ||
Share of income of subsidiaries and VIEs | 59,671 | 61,151 | 20,251 | 3,264 | ||||||
Interest income | 6,595 | 4,329 | 4,147 | 668 | ||||||
Foreign currency exchange (loss)/income, net | (1,829 | ) | 2,239 | (1,536 | ) | (248 | ) | |||
Other income, net | 943 | 398 | 614 | 99 | ||||||
Income before income tax | 58,937 | 63,656 | 20,107 | 3,240 | ||||||
Income tax expenses | — | — | — | — | ||||||
Net income | 58,937 | 63,656 | 20,107 | 3,240 | ||||||
Net income | 58,937 | 63,656 | 20,107 | 3,240 | ||||||
Other comprehensive (loss)/income: | ||||||||||
Foreign currency translation adjustments, net of tax of RMB nil | (775 | ) | (9,083 | ) | 1,799 | 290 | ||||
Share of other comprehensive income/(loss) of subsidiaries and VIEs, net of tax of RMB nil | 3 | 65 | (19 | ) | (3 | ) | ||||
Other comprehensive (loss)/income | (772 | ) | (9,018 | ) | 1,780 | 287 | ||||
Comprehensive income | 58,165 | 54,638 | 21,887 | 3,527 | ||||||
FINANCIAL INFORMATION OF PARENT COMPANY CONDENSED STATEMENTS OF CASH FLOWS | ||||||||||
FINANCIAL INFORMATION OF PARENT COMPANY | ||||||||||
CONDENSED STATEMENTS OF CASH FLOWS | ||||||||||
FOR THE YEARS ENDED DECEMBER 31, 2012, 2013 AND 2014 | ||||||||||
(In thousands) | ||||||||||
For the Year Ended December 31, | ||||||||||
2012 | 2013 | 2014 | 2014 | |||||||
RMB | RMB | RMB | US$ | |||||||
Cash flows provided by operating activities | 26,046 | 519 | 491 | 79 | ||||||
Cash flows provided by/(used in) investing activities | 146,504 | (23,823 | ) | 167,853 | 27,053 | |||||
Cash flows used in financing activities | (57,660 | ) | (73,234 | ) | (183,627 | ) | (29,595 | ) | ||
Effect of exchange rate changes on cash and cash equivalents | (2,604 | ) | (6,844 | ) | 260 | 42 | ||||
Net increase/(decrease) in cash and cash equivalents | 112,286 | (103,382 | ) | (15,023 | ) | (2,421 | ) | |||
Cash and cash equivalents at beginning of year | 64,461 | 176,747 | 73,365 | 11,824 | ||||||
Cash and cash equivalents at end of year | 176,747 | 73,365 | 58,342 | 9,403 | ||||||
Principal_Activities_and_Organ2
Principal Activities and Organization (Details) (USD $) | 0 Months Ended | 12 Months Ended | 0 Months Ended |
In Thousands, except Share data, unless otherwise specified | 16-May-11 | Dec. 31, 2014 | Jan. 26, 2011 |
Principal activities and organization | |||
Net proceeds received by the Company from IPO, after deducting commissions and offering expenses | $65,243 | ||
Shanghai HQS | |||
Principal activities and organization | |||
Percentage of ownership interest in VIE | 100.00% | ||
Beijing HQS | |||
Principal activities and organization | |||
Percentage of ownership interest in VIE | 100.00% | ||
Xique | |||
Principal activities and organization | |||
Percentage of ownership interest in VIE | 100.00% | ||
Beijing Aizhenxin | |||
Principal activities and organization | |||
Percentage of ownership interest in VIE | 100.00% | ||
Jiayuan Shanghai Center | |||
Principal activities and organization | |||
Percentage of ownership interest in VIE subsidiary | 100.00% | ||
BVI Company | |||
Principal activities and organization | |||
Exchange ratio | 1 | ||
Percentage of ownership interest in subsidiary | 100.00% | ||
Shanghai Miyuan | |||
Principal activities and organization | |||
Percentage of ownership interest in subsidiary | 100.00% | ||
Jiayuan Hong Kong | |||
Principal activities and organization | |||
Percentage of ownership interest in subsidiary | 100.00% | ||
Beijing Miyuan | |||
Principal activities and organization | |||
Percentage of ownership interest in subsidiary | 100.00% | ||
Ordinary shares | |||
Principal activities and organization | |||
Issuance of shares (in shares) | 10,050,000 | ||
ADSs | |||
Principal activities and organization | |||
Issuance of shares (in shares) | 6,700,000 |
Variable_Interest_Entities_Det
Variable Interest Entities (Details) | Dec. 31, 2014 | Mar. 01, 2014 | Mar. 01, 2014 | Mar. 01, 2014 | Mar. 01, 2014 | Mar. 01, 2014 | Aug. 13, 2012 | Mar. 01, 2014 | Mar. 01, 2014 |
In Thousands, unless otherwise specified | Consolidated variable interest entities and VIE's subsidiary | Exclusive technology license and service agreements | Loan agreements with shareholders of VIE | Loan agreements with shareholders of VIE | Loan agreements with shareholders of VIE | Loan agreements with shareholders of VIE | Loan agreements with shareholders of VIE | Voting rights entrustment agreements | Cooperative operation agreements |
CNY | Shanghai HQS | Shanghai HQS | Shanghai HQS | Beijing HQS | Xique | Beijing Aizhenxin | Shanghai HQS | Shanghai HQS and Jiayuan Shanghai Center | |
USD ($) | CNY | CNY | CNY | CNY | |||||
Variable Interest Entities | |||||||||
Automatic extension period for the agreement except by mutual agreement and upon early termination | 10 years | 10 years | 10 years | ||||||
Interest free loan granted to shareholders of VIE | $1,200 | 9,000 | 1,000 | 1,000 | 20,000 | ||||
Registered capital | 32,500 |
Summary_of_Significant_Account3
Summary of Significant Accounting Policies (Details) (CNY) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
entity | |||
Basis of presentation and consolidation, information pertaining to Company or its subsidiaries | |||
Number of entities in which the Company has variable interest but is not the primary beneficiary | 0 | ||
Convenience translation | |||
Rate for translation of balances of financial statements from RMB to US$ | 6.2046 | ||
Accounts receivable and allowance for doubtful accounts | |||
Allowance for doubtful accounts | 1,130 | 0 | 110 |
Office building | |||
Investments in real estate | |||
Estimated useful lives | 30 years | ||
Office building improvements | |||
Investments in real estate | |||
Estimated useful lives | 10 years | ||
Computer and software | |||
Investments in real estate | |||
Estimated useful lives | 3 years | ||
Furniture, fixtures and other equipment | |||
Investments in real estate | |||
Estimated useful lives | 3 years | ||
Motor vehicles | |||
Investments in real estate | |||
Estimated useful lives | 4 years |
Summary_of_Significant_Account4
Summary of Significant Accounting Policies (Details 2) (CNY) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
item | |||
Impairment of long-lived assets and intangible assets | |||
Impairment of long-lived assets recognized for the periods presented | 0 | 0 | 0 |
Impairment of intangible assets recognized for the periods presented | 0 | 0 | 0 |
Impairment of investment in equity investee | 0 | 0 | 0 |
Revenue recognition and deferred revenue | |||
Number of types of online services | 2 | ||
Number of primary fee models for online services | 2 | ||
Duration of pay-per-use online services | 1 day | ||
Commission fees paid to wireless value added services partners | 65,997 | 61,881 | 49,923 |
Events and VIP services revenue | |||
Percentage of contract payment refunded to user if termination of VIP Services contract is within initial seven days (as a percent) | 80.00% | ||
Initial period from commencement of VIP Services contract within which users can terminate the contract and receive 80% of payment as refund | 7 days | ||
Customer loyalty program | |||
Revenue recognized from loyalty points | 0 | 4,917 | 0 |
Deferred revenue from customer loyalty program | 0 | ||
Trademarks and domain names | |||
Goodwill and intangible assets | |||
Estimated useful lives | 10 years | ||
Customer relationships | |||
Goodwill and intangible assets | |||
Estimated useful lives | 5 years | ||
Source code | |||
Goodwill and intangible assets | |||
Estimated useful lives | 10 years |
Summary_of_Significant_Account5
Summary of Significant Accounting Policies (Details 3) (CNY) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Employee benefit expenses | |||
Employee benefit expenses | 20,553 | 17,568 | 14,005 |
The PRC | |||
Income tax | |||
Withholding tax rate payable by foreign-invested entities (as a percent) | 10.00% | ||
Withholding tax rate payable by foreign-invested entities with parent company incorporated in specified jurisdiction (as a percent) | 5.00% | ||
Minimum percentage of equity interests held by the holding entity in foreign invested enterprise to be considered to be subject to 5% withholding tax rate | 25.00% |
Summary_of_Significant_Account6
Summary of Significant Accounting Policies (Details 4) (CNY) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Statutory Reserves | |||
Minimum percentage appropriation to general reserve fund required | 10.00% | ||
Reserve level threshold for mandatory appropriation requirement (as a percent) | 50.00% | ||
Minimum percentage appropriation to statutory surplus fund required | 10.00% | ||
Surplus fund threshold for mandatory appropriation requirement (as a percent) | 50.00% | ||
Appropriation to statutory reserves | 129 | 472 | 3,710 |
Advertising expenses | |||
Advertising costs included in selling and marketing expenses | 105,636 | 71,498 | 69,966 |
Summary_of_Significant_Account7
Summary of Significant Accounting Policies (Details 5) | Dec. 31, 2014 |
Net income per share and per American Depository Share ("ADS") | |
Number of American Depository Shares per ordinary share of the company | 0.667 |
Concentration_Credit_and_Other2
Concentration, Credit and Other Risks (Details) | 12 Months Ended | ||||||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
USD ($) | CNY | CNY | CNY | Consolidated variable interest entities and VIE's subsidiary | Consolidated variable interest entities and VIE's subsidiary | Consolidated variable interest entities and VIE's subsidiary | |
CNY | CNY | CNY | |||||
Concentration, credit and other risks | |||||||
Total assets | 633,177 | 501,281 | |||||
Total liabilities | 409,772 | 312,572 | |||||
Payable to third parties | 270,533 | 189,803 | |||||
Payable to Group entities | 139,239 | 122,769 | |||||
Net revenue | 98,957 | 613,990 | 492,606 | 410,803 | 614,239 | 492,799 | 411,084 |
Net income | 3,240 | 20,107 | 63,656 | 58,937 | 25,133 | 61,608 | 23,038 |
Inter-company service fees paid/payable | 11,615 | 9,278 | 43,446 | ||||
Cash flows provided by operating activities | 12,441 | 77,198 | 166,967 | 57,685 | 90,925 | 151,318 | 54,966 |
Cash flows provided by/(used in) investing activities | 11,323 | 70,258 | -111,747 | 78,960 | -97,104 | -87,916 | -67,544 |
Effect of exchange rate changes on cash and cash equivalents | 69 | 415 | -7,082 | -2,617 | 134 | -180 | -11 |
Net increase/(decrease) in cash and cash equivalents | -5,762 | -35,756 | -25,096 | 76,369 | -6,045 | 63,222 | -12,589 |
Property and equipment, intangible assets and goodwill of VIEs | |||||||
Property and equipment, net | 14,778 | 91,694 | 99,484 | 91,208 | 99,296 | ||
Intangible assets, net | 582 | 3,610 | 4,275 | 3,610 | 4,275 | ||
Goodwill | $127 | 789 | 789 | 789 | 789 | ||
Original maturity term of available-for-sale securities which were placed with a financial institution | 1 month | 1 month |
Fair_Value_Measurements_Detail
Fair Value Measurements (Details) | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | USD ($) | CNY | CNY | Recurring Basis | Recurring Basis | Recurring Basis | Recurring Basis |
Significant other observable inputs (Level 2) | Significant other observable inputs (Level 2) | Total fair value and carrying value on balance sheet | Total fair value and carrying value on balance sheet | ||||
CNY | CNY | CNY | CNY | ||||
Assets measured on recurring basis | |||||||
Cash equivalents | 196,810 | 232,458 | 196,810 | 232,458 | |||
Short-term deposits | 38,595 | 239,466 | 336,299 | 239,466 | 336,299 | 239,466 | 336,299 |
Available-for-sale securities | 15,715 | 5,233 | 15,715 | 5,233 |
Accounts_Receivable_net_Detail
Accounts Receivable, net (Details) | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | USD ($) | CNY | CNY | CNY |
Accounts Receivable, net | ||||
Accounts receivable | 38,875 | 33,987 | ||
Less: Allowance for doubtful accounts | -1,130 | -110 | ||
Accounts receivable, net | $6,083 | 37,745 | 33,987 |
Accounts_Receivable_net_Detail1
Accounts Receivable, net (Details 2) (CNY) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Accounts Receivable, net | ||
Balance as of beginning period | 110 | |
Provision of bad debt | 2,364 | |
Write-off bad debt | -1,234 | -110 |
Balance as of ending period | 1,130 |
Prepaid_Expenses_and_Other_Cur2
Prepaid Expenses and Other Current Assets (Details) | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | USD ($) | CNY | CNY |
Prepaid Expenses and Other Current Assets | |||
Prepaid commission to matchmaking service agencies | 45,915 | 6,172 | |
Prepaid expenses-other | 7,235 | 6,659 | |
Advances to employees | 4,014 | 2,761 | |
Interest receivables | 2,417 | 4,782 | |
Rental and other deposits | 3,653 | 2,781 | |
Inventory | 1,553 | ||
Others | 1,714 | 540 | |
Prepaid expenses and other current assets | $10,718 | 66,501 | 23,695 |
Investment_in_equity_investee_
Investment in equity investee (Details) (Beijing HQS, Wuhan Didi, CNY) | Oct. 31, 2014 |
In Millions, unless otherwise specified | |
Beijing HQS | Wuhan Didi | |
Investment in equity investee | |
Cash consideration paid upon the closing of the transaction | 11 |
Percentage of economic interests held | 20.00% |
Property_and_Equipment_net_Det
Property and Equipment, net (Details) | 12 Months Ended | |||||||||||||||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 |
CNY | CNY | CNY | USD ($) | Office building | Office building | Office building improvements | Office building improvements | Computer and software | Computer and software | Furniture, fixtures and other equipment | Furniture, fixtures and other equipment | Motor vehicles | Motor vehicles | Leasehold improvements | Leasehold improvements | |
CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | |||||
Property and equipment, net | ||||||||||||||||
Property and equipment, gross | 148,308 | 144,199 | 77,797 | 77,797 | 3,948 | 3,884 | 56,942 | 54,271 | 4,960 | 4,544 | 407 | 407 | 4,254 | 3,296 | ||
Less: accumulated depreciation and amortization | -56,614 | -44,715 | ||||||||||||||
Property and equipment, net | 91,694 | 99,484 | 14,778 | |||||||||||||
Depreciation and amortization expenses for the property and equipment | 13,716 | 15,576 | 13,264 |
Business_Combination_Details
Business Combination (Details) | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 10, 2012 | Dec. 10, 2012 | Dec. 10, 2012 | Dec. 10, 2012 | Dec. 10, 2012 |
In Thousands, unless otherwise specified | USD ($) | CNY | CNY | Juedui 100 | Juedui 100 | Juedui 100 | Juedui 100 | Juedui 100 |
CNY | CNY | Brand name | Customer relationships | Source code | ||||
CNY | CNY | CNY | ||||||
Acquisition of The Juedui 100 Business | ||||||||
Purchase consideration | 5,500 | |||||||
Identifiable intangible assets | 2,141 | 1,637 | 933 | |||||
Identifiable assets acquired | 4,711 | |||||||
Goodwill | 127 | 789 | 789 | 789 | ||||
Cash consideration | 5,500 |
Intangible_assets_net_Details
Intangible assets, net (Details) | 12 Months Ended | |||||||||||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 |
CNY | CNY | CNY | USD ($) | Brand name | Brand name | Customer relationships | Customer relationships | Source code | Source code | Domain names | Domain names | |
CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | |||||
Intangible assets, net | ||||||||||||
Gross Carrying Amount | 5,016 | 5,016 | 2,141 | 2,141 | 1,637 | 1,637 | 933 | 933 | 305 | 305 | ||
Less: accumulated amortization | -1,406 | -741 | ||||||||||
Intangible assets, net | 3,610 | 4,275 | 582 | |||||||||
Amortization expenses | 665 | 599 | 142 | |||||||||
Amortization expenses for future periods | ||||||||||||
2015 | 665 | |||||||||||
2016 | 665 | |||||||||||
2017 | 612 | |||||||||||
2018 | 338 | |||||||||||
2019 | 338 | |||||||||||
Thereafter | 992 | |||||||||||
Intangible assets, net | 3,610 | 4,275 | 582 | |||||||||
Impairment of intangible assets | 0 | 0 | 0 |
Goodwill_Details
Goodwill (Details) (CNY) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Goodwill | ||
Goodwill impairment recognized | 0 | 0 |
Accrued_Expenses_and_Other_Lia2
Accrued Expenses and Other Liabilities (Details) | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | USD ($) | CNY | CNY |
Accrued Expenses and Other Liabilities | |||
Accrued salaries and welfare | 17,964 | 19,740 | |
Accrued advertising expenses | 2,388 | 2,371 | |
Accrued network support expenses | 1,801 | 1,908 | |
Business and other tax payable | 4,093 | 3,304 | |
Professional and other service fees | 9,262 | 6,556 | |
Deposits received from matchmaking service agencies | 8,980 | 2,850 | |
Others | 6,652 | 5,616 | |
Balance as at 31 December | 51,140 | 42,345 | |
Less: Current portion | 7,332 | 45,490 | 39,615 |
Non-current portion | $911 | 5,650 | 2,730 |
Taxation_Details
Taxation (Details) (CNY) | 12 Months Ended | 13 Months Ended | 23 Months Ended | 16 Months Ended | 28 Months Ended | 7 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Jan. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2014 |
Business Tax, Value Added Tax and Surcharges | ||||||||
Business tax and surcharges | 16,345 | 17,090 | 14,242 | |||||
Shanghai Miyuan | ||||||||
Transition from PRC Business Tax to PRC Value Added Tax | ||||||||
Value Added Tax rate (as a percent) | 3.00% | 6.00% | ||||||
Beijing Miyuan | ||||||||
Transition from PRC Business Tax to PRC Value Added Tax | ||||||||
Value Added Tax rate (as a percent) | 6.00% | 3.00% | ||||||
Beijing Aizhenxin | ||||||||
Transition from PRC Business Tax to PRC Value Added Tax | ||||||||
Value Added Tax rate (as a percent) | 3.00% | |||||||
Shanghai HQS | ||||||||
Transition from PRC Business Tax to PRC Value Added Tax | ||||||||
Value Added Tax rate (as a percent) | 6.00% | |||||||
Minimum | ||||||||
Business Tax, Value Added Tax and Surcharges | ||||||||
Business tax and surcharges rate (as a percent) | 0.00% | |||||||
Maximum | ||||||||
Business Tax, Value Added Tax and Surcharges | ||||||||
Business tax and surcharges rate (as a percent) | 8.60% |
Taxation_Details_2
Taxation (Details 2) | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | |||||||||||||||||||||||||||||||||||||||
In Thousands, except Per Share data, unless otherwise specified | 6-May-13 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Oct. 29, 2014 | Jun. 18, 2013 | Sep. 29, 2014 | 16-May-13 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2010 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 |
USD ($) | CNY | CNY | ADSs | ADSs | ADSs | ADSs | Hong Kong | Hong Kong | Hong Kong | The PRC | The PRC | The PRC | The PRC | The PRC | The PRC | The PRC | The PRC | The PRC | The PRC | The PRC | The PRC | The PRC | The PRC | The PRC | The PRC | The PRC | The PRC | The PRC | The PRC | The PRC | The PRC | The PRC | The PRC | The PRC | The PRC | The PRC | The PRC | The PRC | The PRC | Cayman Islands | |||
USD ($) | USD ($) | USD ($) | USD ($) | Jiayuan Hong Kong | Jiayuan Hong Kong | Jiayuan Hong Kong | CNY | High and new technology enterprise | Qualified software enterprise | Qualified key software enterprises | Shanghai Miyuan | Shanghai Miyuan | Shanghai Miyuan | Shanghai Miyuan | Shanghai Miyuan | Shanghai HQS | Shanghai HQS | Shanghai HQS | Shanghai HQS | Shanghai HQS | Shanghai HQS | Shanghai HQS | Shanghai HQS | Beijing HQS | Beijing HQS | Beijing HQS | Xique | Xique | Xique | Beijing Aizhenxin | Beijing Aizhenxin | Beijing Aizhenxin | Beijing Miyuan | Jiayuan Shanghai Center | Jiayuan Shanghai Center | Jiayuan Shanghai Center | |||||||
Qualified software enterprise | Qualified software enterprise | Qualified software enterprise | High and new technology enterprise | High and new technology enterprise | High and new technology enterprise | High and new technology enterprise | High and new technology enterprise | High and new technology enterprise | Qualified software enterprise | Qualified software enterprise | Qualified software enterprise | ||||||||||||||||||||||||||||||||
Future | Future | ||||||||||||||||||||||||||||||||||||||||||
Income tax | |||||||||||||||||||||||||||||||||||||||||||
Withholding income tax rate upon payment of dividends by the Company to its shareholders | 0.00% | ||||||||||||||||||||||||||||||||||||||||||
Statutory tax rate (as a percent) | 25.00% | 25.00% | 25.00% | 25.00% | 16.50% | 16.50% | 16.50% | 25.00% | 25.00% | 25.00% | 25.00% | 25.00% | 25.00% | 25.00% | 25.00% | 25.00% | 25.00% | 25.00% | 25.00% | 25.00% | 25.00% | 25.00% | |||||||||||||||||||||
Preferential income tax rate (as a percent) | 15.00% | 10.00% | 12.50% | 12.50% | 12.50% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 10.00% | 10.00% | 12.50% | |||||||||||||||||||||||||||||
Exemption period for income tax rate | 2 years | 2 years | |||||||||||||||||||||||||||||||||||||||||
Reduction in income tax for three years following the exemption period (as a percent) | 50.00% | 50.00% | |||||||||||||||||||||||||||||||||||||||||
Exemption period for 50% reduction in the tax rate following initial exemption period | 3 years | 3 years | |||||||||||||||||||||||||||||||||||||||||
Withholding tax rate payable by foreign-invested entities (as a percent) | 10.00% | ||||||||||||||||||||||||||||||||||||||||||
Withholding tax rate payable by foreign-invested entities with parent company incorporated in specified jurisdiction (as a percent) | 5.00% | ||||||||||||||||||||||||||||||||||||||||||
Special cash dividend declared (in dollars per share) | $0.67 | $0.26 | |||||||||||||||||||||||||||||||||||||||||
Special dividend paid | $26,746 | 165,951 | 48,246 | $19,767 | $7,800 | ||||||||||||||||||||||||||||||||||||||
Withholding tax withheld on behalf of the Company's shareholders | 0 | ||||||||||||||||||||||||||||||||||||||||||
Annual dividends payable as percentage of annual net income before share-based compensation expenses | 60.00% | ||||||||||||||||||||||||||||||||||||||||||
Deferred tax liabilities for the accumulated earnings expected to be distributed as cash dividends from the Group's PRC entities to the Group's overseas entities | 6,517 | 4,590 | |||||||||||||||||||||||||||||||||||||||||
Undistributed earnings from the Group's PRC entities | 262,568 | 219,876 | |||||||||||||||||||||||||||||||||||||||||
Estimated foreign withholding taxes due upon remittance of undistributed earnings | 26,257 | 21,988 |
Taxation_Details_3
Taxation (Details 3) | 12 Months Ended | ||||||||||||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 | Dec. 31, 2012 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 |
USD ($) | CNY | CNY | CNY | Unrecognized tax losses | Unrecognized tax losses | Unrecognized tax losses | Accrued salaries and other expenses | Accrued salaries and other expenses | Advertising expenses | Advertising expenses | Advertising expenses | Doubtful accounts | |
Composition of income tax expenses | |||||||||||||
Current tax expenses | 6,434 | 9,520 | 8,753 | ||||||||||
Deferred taxation | -552 | -3,427 | 3,533 | 474 | |||||||||
Income tax expenses | 485 | 3,007 | 13,053 | 9,227 | |||||||||
Reconciliation of the differences between the PRC statutory EIT rate | |||||||||||||
Statutory EIT rate | 25.00% | 25.00% | 25.00% | 25.00% | |||||||||
Effect of non-deductible expenses | 7.90% | 7.90% | 2.60% | 4.90% | |||||||||
Effect of lower tax rates in other jurisdictions | 0.30% | 0.30% | -0.80% | 0.30% | |||||||||
Effect of preferential tax treatments | -19.30% | -19.30% | -15.00% | -19.20% | |||||||||
Tax incentives for research and development expenses | -7.20% | -7.20% | -3.90% | -3.10% | |||||||||
Withholding income tax for dividends (as a percent) | 8.30% | 8.30% | 6.00% | ||||||||||
Changes in valuation allowance | -2.00% | -2.00% | 3.10% | 5.60% | 1.80% | 1.70% | 1.70% | -1.20% | 0.20% | -3.80% | 1.40% | 3.70% | 1.20% |
Effective income tax rate | 13.00% | 13.00% | 17.00% | 13.50% | |||||||||
Percentage of the research and development expenses incurred in an year that may be claimed as an additional tax deduction | 50.00% | 50.00% | 50.00% | 50.00% | |||||||||
Effect of the preferential tax treatments | |||||||||||||
Preferential tax treatments impact to net income to ordinary shareholders | 6,125 | 14,498 | 15,201 | ||||||||||
Per share effect, basic | 0.14 | 0.32 | 0.33 | ||||||||||
Per share effect, diluted | 0.13 | 0.32 | 0.32 |
Taxation_Details_4
Taxation (Details 4) (CNY) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
In Thousands, unless otherwise specified | ||||
Deferred tax assets, current | ||||
Net operating loss carry forwards | 6,565 | 4,365 | ||
Accrued salaries and other expenses | 3,329 | 3,391 | ||
Advertising expenses | 18,799 | 15,214 | ||
Government subsidies | 169 | 333 | ||
Other | 616 | 188 | ||
Total: deferred tax assets, current | 29,478 | 23,491 | ||
Total: deferred tax assets | 29,478 | 23,491 | ||
Less: valuation allowance | ||||
Total: valuation allowance | -20,496 | -19,863 | -17,315 | -13,652 |
Net deferred tax assets | 8,982 | 3,628 | ||
Deferred tax liabilities, non-current | ||||
Withholding income tax for dividends | 6,517 | 4,590 | ||
Net operating loss carry forwards | ||||
Less: valuation allowance | ||||
Total: valuation allowance | -4,667 | -4,365 | ||
Accrued salaries and other expenses | ||||
Less: valuation allowance | ||||
Total: valuation allowance | -284 | |||
Advertising expenses | ||||
Less: valuation allowance | ||||
Total: valuation allowance | -15,448 | -15,214 | ||
Other | ||||
Less: valuation allowance | ||||
Total: valuation allowance | -381 |
Taxation_Details_5
Taxation (Details 5) (CNY) | Dec. 31, 2014 |
In Thousands, unless otherwise specified | |
Net operating loss carry forwards | |
Net operating loss carry forwards from certain subsidiary, VIEs and VIE's subsidiary | 34,217 |
Expiring on 31st December 2015 | |
Net operating loss carry forwards | |
Net operating loss carry forwards from certain subsidiary, VIEs and VIE's subsidiary | 1,983 |
Expiring on 31st December 2016 | |
Net operating loss carry forwards | |
Net operating loss carry forwards from certain subsidiary, VIEs and VIE's subsidiary | 6,392 |
Expiring on 31st December 2017 | |
Net operating loss carry forwards | |
Net operating loss carry forwards from certain subsidiary, VIEs and VIE's subsidiary | 3,522 |
Expiring on 31st December 2018 | |
Net operating loss carry forwards | |
Net operating loss carry forwards from certain subsidiary, VIEs and VIE's subsidiary | 5,043 |
Expiring on 31st December 2019 | |
Net operating loss carry forwards | |
Net operating loss carry forwards from certain subsidiary, VIEs and VIE's subsidiary | 16,204 |
Taxation_Details_6
Taxation (Details 6) (CNY) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Movements of valuation allowance | |||
Balance at beginning of the year | -19,863 | -17,315 | -13,652 |
Provision for the year | -633 | -2,548 | -3,663 |
Balance at end of the year | -20,496 | -19,863 | -17,315 |
Maximum | |||
Income tax valuation allowance | |||
Deductible advertising expenses as percentage of revenues | 15.00% |
Ordinary_Shares_and_Treasury_S1
Ordinary Shares and Treasury Shares (Details) | 12 Months Ended | 1 Months Ended | 12 Months Ended | |||||||||||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 | Dec. 31, 2013 | Nov. 30, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
CNY | CNY | CNY | USD ($) | USD ($) | ADSs | ADSs | ADSs | ADSs | ADSs | ADSs | Ordinary shares | Ordinary shares | Ordinary shares | |
USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | ||||||||||
Ordinary Shares and Treasury Shares | ||||||||||||||
Ordinary shares, shares authorized | 100,000,000 | 100,000,000 | ||||||||||||
Ordinary shares, par value (in dollars per share) | $0.00 | $0.00 | ||||||||||||
Ordinary shares, shares issued | 49,930,944 | 49,030,944 | ||||||||||||
Ordinary shares issued to depository for issuance of ADS upon the exercise of options | 592,097 | 339,366 | ||||||||||||
Treasury shares | ||||||||||||||
Aggregate value of ADS authorized to be repurchased under share repurchase plan | $10,000 | $10,000 | $10,000 | |||||||||||
Period of share repurchase plan | 12 months | 1 year | 1 year | |||||||||||
ADSs repurchased under share repurchase plan (in shares) | 776,341 | 931,593 | 2,004,526 | |||||||||||
Aggregate value of ADS repurchased under share repurchase plan (in dollars) | 26,380 | 33,097 | 63,702 | $4,287 | $5,359 | $10,076 | ||||||||
Shares cancelled | 0 | 0 | 258,450 | |||||||||||
Ordinary shares repurchased but not cancelled | 5,310,240 | 4,145,729 | 5,310,240 |
Sharebased_Compensation_Detail
Share-based Compensation (Details) (Share Incentive Plan, USD $) | 12 Months Ended | 0 Months Ended | ||||||||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Jul. 12, 2012 | Oct. 10, 2014 | Jun. 05, 2014 | Jun. 15, 2012 | Dec. 08, 2010 | 14-May-07 |
Share options | ||||||||||
Balances outstanding at the beginning of the period (in shares) | 3,134,475 | 4,368,382 | 4,382,636 | |||||||
Granted (in shares) | 457,500 | 90,000 | 2,410,000 | |||||||
Exercised (in shares) | -642,058 | -981,992 | -913,801 | |||||||
Modified (in shares) | -290,547 | |||||||||
Forfeited (in shares) | -173,462 | -291,915 | -1,169,906 | |||||||
Expired (in shares) | -50,000 | -50,000 | ||||||||
Balances outstanding at the end of the period (in shares) | 2,776,455 | 3,134,475 | 4,368,382 | 4,382,636 | ||||||
Exercisable at the end of the period (in shares) | 1,373,002 | 1,357,529 | 1,353,698 | |||||||
Weighted average exercise price | ||||||||||
Balances outstanding at beginning of period (in dollars per share) | $3.10 | $2.69 | $2.78 | |||||||
Granted (in dollars per share) | $3.71 | $4.61 | $3.35 | |||||||
Exercised (in dollars per share) | $2 | $1.33 | $1.05 | |||||||
Modified (in dollars per share) | $3.23 | |||||||||
Forfeited (in dollars per share) | $3.41 | $3.87 | $4.35 | |||||||
Expired (in dollars per share) | $0.30 | $0.30 | ||||||||
Outstanding at end of year (in dollars per share) | $3.02 | $3.10 | $2.69 | $2.78 | ||||||
Exercisable at the end of the period (in dollars per share) | $2.82 | $2.75 | $1.40 | |||||||
Weighted average remaining contractual life (in years) | ||||||||||
Balances outstanding at the end of the period | 3 years 7 months 24 days | 3 years 11 months 23 days | 4 years 4 months 2 days | 4 years 2 months 23 days | ||||||
Exercisable at the end of the period | 3 years 1 month 24 days | 3 years 4 months 24 days | 2 years 4 months 21 days | |||||||
Weighted average grant date fair value | ||||||||||
Balances outstanding at the beginning of the period (in dollars per share) | $1.31 | $1.30 | $1.57 | |||||||
Granted (in dollars per share) | $1.22 | $1.15 | $1.26 | |||||||
Exercised (in dollars per shares) | $1.09 | $1.32 | $0.90 | |||||||
Modified (in dollars per share) | $1.06 | |||||||||
Forfeited (in dollars per share) | $1.28 | $1.37 | $1.95 | |||||||
Expired (in dollars per share) | $0.05 | $0.02 | ||||||||
Balances outstanding at the end of the period (in dollars per share) | $1.30 | $1.31 | $1.30 | $1.57 | ||||||
Exercisable at the end of the period (in dollars per share) | $1.36 | $1.31 | $1.24 | |||||||
Intrinsic value information | ||||||||||
Intrinsic value of outstanding options (in dollars) | $918 | |||||||||
Intrinsic value of exercisable options (in dollars) | 618 | |||||||||
Vested (in shares) | 722,919 | |||||||||
Total intrinsic value of options exercised | $1,709 | $2,665 | $2,172 | |||||||
Director and certain employees | ||||||||||
Share-based compensation | ||||||||||
Shares cancelled | 546,000 | |||||||||
Share options | ||||||||||
Granted (in shares) | 255,453 | |||||||||
Weighted average exercise price | ||||||||||
Modified (in dollars per share) | $3.23 | |||||||||
Director and certain employees | ADSs | ||||||||||
Weighted average exercise price | ||||||||||
Decrease in original exercise prices (in dollars per share) | $0.67 | |||||||||
Director and certain employees | Minimum | ||||||||||
Weighted average exercise price | ||||||||||
Granted (in dollars per share) | $5 | |||||||||
Director and certain employees | Maximum | ||||||||||
Weighted average exercise price | ||||||||||
Granted (in dollars per share) | $7.44 | |||||||||
Director, employees and non-employee | ||||||||||
Share-based compensation | ||||||||||
Extended option life | 1 year | |||||||||
Share options | ||||||||||
Share options amended (in shares) | 120,850 | |||||||||
Condition one | ||||||||||
Share-based compensation | ||||||||||
Total requisite service period as stipulated in the share option agreements | 4 years | |||||||||
Condition one | First anniversary of the date of grant | ||||||||||
Share-based compensation | ||||||||||
Portion of options vesting (as a percent) | 25.00% | |||||||||
Condition one | Pro-rata vesting on calendar quarter-end of each 12 quarters after first anniversary of grant | ||||||||||
Share-based compensation | ||||||||||
Portion of options vesting (as a percent) | 75.00% | |||||||||
Number of calendar quarters for pro-rata vesting | 12 | |||||||||
Condition two | ||||||||||
Share-based compensation | ||||||||||
Total requisite service period as stipulated in the share option agreements | 4 years | |||||||||
Condition two | Vesting on date of IPO | ||||||||||
Share-based compensation | ||||||||||
Portion of options vesting (as a percent) | 25.00% | |||||||||
Condition two | Pro-rata vesting on calendar quarter-end of each 12 quarters following IPO | ||||||||||
Share-based compensation | ||||||||||
Portion of options vesting (as a percent) | 75.00% | |||||||||
Number of calendar quarters for pro-rata vesting | 12 | |||||||||
Condition three | Vesting on date of IPO | ||||||||||
Share-based compensation | ||||||||||
Portion of options vesting (as a percent) | 100.00% | |||||||||
BVI Company | ||||||||||
Share-based compensation | ||||||||||
Shares approved for purchase by issuance of options under the plan | 7,633,920 | 5,233,920 | 2,960,606 | |||||||
Authorized shares increased for purchase by issuance of options under the plan | 2,400,000 |
Sharebased_Compensation_Detail1
Share-based Compensation (Details 2) (Share Incentive Plan, Share options, CNY) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Summary of assumptions used to estimate the fair values of options granted | |||
Risk-free interest rate, minimum (as a percent) | 1.30% | ||
Risk-free interest rate, maximum (as a percent) | 2.25% | ||
Risk-free interest rate (as a percent) | 2.70% | 2.05% | |
Exercise multiple | 2.80% | 2.80% | 2.80% |
Expected forfeiture rate (as a percent) | 5.00% | 5.00% | 5.00% |
Contractual life of option | 6 years | 6 years | 6 years |
Expected volatility, minimum (as a percent) | 38.00% | ||
Expected volatility, maximum (as a percent) | 38.88% | ||
Expected volatility, (as a percent) | 45.00% | 39.00% | |
Dividend yield (as a percent) | 4.00% | 5.00% | |
Additional information | |||
Fair value of equity awards vested during the period | 5,912 | 9,275 | 4,246 |
Unrecognized compensation costs related to non-vested shares | 3,717 | ||
Expected weighted average period of recognition of unrecognized compensation costs | 10 months 21 days | ||
Service conditions | |||
Additional information | |||
Share-based compensation | 5,522 | 8,276 | 10,891 |
Sharebased_Compensation_Detail2
Share-based Compensation (Details 3) (Founder's Share Agreement) | 12 Months Ended | 0 Months Ended | ||||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 16, 2009 | Dec. 16, 2009 | Dec. 16, 2009 |
CNY | CNY | CNY | BVI Company | BVI Company | BVI Company | |
COO | Vesting on second anniversary of agreement date | Vesting on fourth anniversary of agreement date | ||||
USD ($) | COO | COO | ||||
Share-based compensation | ||||||
Options granted (in shares) | 398,000 | |||||
Options granted (in dollars per share) | $1.26 | |||||
Vesting period of awards | 4 years | |||||
Portion of options vested (as a percent) | 50.00% | 50.00% | ||||
Share-based compensation in general and administrative expenses | 0 | 0 | 92 |
Sharebased_Compensation_Detail3
Share-based Compensation (Details 4) (Restricted Shares, CNY) | 1 Months Ended | 12 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Share-based compensation | ||||
Vesting period | 4 years | |||
Restricted Shares | ||||
Balance outstanding at the beginning of the period (in shares) | 312,941 | 281,540 | ||
Granted (in shares) | 281,540 | 486,000 | 34,286 | |
Exercised (in shares) | -5,211 | |||
Forfeited (in shares) | -13,623 | -2,885 | ||
Balance outstanding at the end of the period (in shares) | 281,540 | 780,107 | 312,941 | 281,540 |
Weighted average remaining contractual life | ||||
Balance outstanding at the end of the period | 4 years 8 months 23 days | 4 years 5 months 27 days | 5 years 4 months 2 days | |
Additional disclosures | ||||
Fair value of awards vested | 1,850 | 2,580 | 0 | |
Share-based compensation | 4,040 | 2,152 | 2,380 | |
Unrecognized compensation expenses | 7,406 | |||
Weighted average period over which unrecognized compensation expenses are expected to be recognized | 1 year 11 days | |||
Vested (in shares) | 80,198 | |||
First anniversary of the date of grant | ||||
Share-based compensation | ||||
Percentage of awards subject to vest | 25.00% | |||
Pro-rata vesting on calendar quarter-end of each 12 quarters after first anniversary of grant | ||||
Share-based compensation | ||||
Percentage of awards subject to vest | 75.00% | |||
Period of vesting of the remaining 75% awards granted | 12 |
Net_Income_Per_Share_Details
Net Income Per Share (Details) | 12 Months Ended | |||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
USD ($) | CNY | CNY | CNY | |
Numerator: | ||||
Net income | $3,240 | 20,107 | 63,656 | 58,937 |
Denominator: | ||||
Weighted average number of ordinary shares outstanding-basic | 44,423,885 | 44,423,885 | 44,910,676 | 46,297,314 |
Dilutive effect of share options | 966,924 | 966,924 | 917,246 | 1,445,784 |
Weighted average number of ordinary shares outstanding-diluted | 45,390,809 | 45,390,809 | 45,827,922 | 47,743,098 |
Basic net income per share (in CNY per share) | $0.07 | 0.45 | 1.42 | 1.27 |
Diluted net income per share (in CNY per share) | $0.07 | 0.44 | 1.39 | 1.23 |
Potentially dilutive share options and restricted shares not included in the calculation of diluted net income per share | 120,758 | 120,758 | 296,857 | 1,012,007 |
Ordinary shares issued to depository for issuance of ADS upon exercise of options | 592,097 | 592,097 | 339,366 |
Commitments_and_Contingencies_1
Commitments and Contingencies (Details) (CNY) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Future minimum payments under non-cancellable operating leases | |||
2015 | 8,463 | ||
2016 | 5,382 | ||
2017 | 450 | ||
Total | 14,295 | ||
Total rental expenses | 4,843 | 4,795 | 6,387 |
Related_Party_Transactions_Det
Related Party Transactions (Details) (CNY) | 0 Months Ended | 12 Months Ended | 0 Months Ended | |
In Thousands, unless otherwise specified | Dec. 24, 2012 | Dec. 31, 2014 | Dec. 31, 2013 | Oct. 29, 2013 |
Ms Haiyan Gong | ||||
Related party transactions | ||||
Term of agreement | 3 years | |||
General and administrative expense | 643 | 633 | ||
Monthly fee for consultancy services | 49 | |||
Mr. JP Gan | ||||
Related party transactions | ||||
Term of agreement | 20 months | |||
Fee for personalized matchmaking services | 120 | |||
Revenues recognized | 72 | 12 |
Segment_Information_Details
Segment Information (Details) | 12 Months Ended | ||||||||||||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
USD ($) | CNY | CNY | CNY | Online services | Online services | Online services | Personalized matchmaking services | Personalized matchmaking services | Personalized matchmaking services | Events and other services | Events and other services | Events and other services | |
segment | CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | CNY | ||||
Segment Information | |||||||||||||
Number of reportable segments | 3 | ||||||||||||
Segment Information | |||||||||||||
Net revenues | $98,957 | 613,990 | 492,606 | 410,803 | 425,544 | 422,088 | 362,492 | 164,598 | 52,458 | 33,143 | 23,848 | 18,060 | 15,168 |
Cost of revenues | -44,772 | -277,789 | -180,521 | -143,685 | -148,811 | -140,975 | -117,830 | -117,054 | -29,792 | -15,903 | -11,924 | -9,754 | -9,952 |
Gross profit | $54,185 | 336,201 | 312,085 | 267,118 | 276,733 | 281,113 | 244,662 | 47,544 | 22,666 | 17,240 | 11,924 | 8,306 | 5,216 |
Restricted_Net_Assets_Details
Restricted Net Assets (Details) | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | USD ($) | CNY | CNY | The PRC | The PRC |
CNY | CNY | ||||
Restricted Net Assets | |||||
Restricted net assets | 113,771 | 120,528 | |||
Retained earnings balance of the Group's PRC entities after appropriation to statutory reserves | $23,587 | 146,345 | 126,367 | 262,568 | 219,876 |
Restricted_Net_Assets_Details_
Restricted Net Assets (Details 2) | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
In Thousands, except Share data, unless otherwise specified | USD ($) | CNY | USD ($) | CNY | CNY | CNY | Parent company | Parent company | Parent company | Parent company | Parent company | Parent company |
USD ($) | CNY | USD ($) | CNY | CNY | CNY | |||||||
Current assets: | ||||||||||||
Cash and cash equivalents | $31,728 | 196,857 | $37,490 | 232,613 | 257,709 | 181,340 | $9,403 | 58,342 | $11,824 | 73,365 | 176,747 | 64,461 |
Short-term deposits | 38,595 | 239,466 | 336,299 | 1,526 | 9,466 | 177,319 | ||||||
Prepaid expenses and other current assets | 10,718 | 66,501 | 23,695 | 1,282 | 7,955 | 8,000 | ||||||
Total current assets | 91,105 | 565,266 | 635,455 | 12,211 | 75,763 | 258,684 | ||||||
Non-current assets: | ||||||||||||
Investments in subsidiaries and VIEs | 50,971 | 316,253 | 286,455 | |||||||||
Total assets | 108,540 | 673,446 | 740,003 | 63,182 | 392,016 | 545,139 | ||||||
Current liabilities: | ||||||||||||
Accrued expenses and other liabilities, current portion | 7,332 | 45,490 | 39,615 | 802 | 4,976 | 5,921 | ||||||
Total current liabilities | 44,199 | 274,237 | 193,096 | 802 | 4,976 | 5,921 | ||||||
Total liabilities | 46,160 | 286,406 | 200,785 | 802 | 4,976 | 5,921 | ||||||
SHAREHOLDERS' EQUITY | ||||||||||||
Ordinary shares (US$0.001 par value; 100,000,000 shares authorized as of December 31, 2013 and 2014; 49,030,944 shares issued and outstanding as of December 31, 2013; 49,930,944 shares issued and outstanding as of December 31, 2014) | 57 | 354 | 349 | 57 | 354 | 349 | ||||||
Additional paid-in capital | 57,823 | 358,768 | 506,458 | 57,823 | 358,768 | 506,458 | ||||||
Less: Treasury shares (4,145,729 and 5,310,240 shares as of December 31, 2013 and 2014, respectively) | -18,934 | -117,480 | -91,100 | -18,934 | -117,480 | -91,100 | ||||||
Statutory reserves | 1,628 | 10,103 | 9,974 | 1,628 | 10,103 | 9,974 | ||||||
Retained earnings | 23,587 | 146,345 | 126,367 | 23,587 | 146,345 | 126,367 | ||||||
Accumulated other comprehensive loss | -1,781 | -11,050 | -12,830 | -1,781 | -11,050 | -12,830 | ||||||
Total shareholders' equity | 62,380 | 387,040 | 539,218 | 547,386 | 533,517 | 62,380 | 387,040 | 539,218 | ||||
Total liabilities and shareholders' equity | $108,540 | 673,446 | 740,003 | $63,182 | 392,016 | 545,139 | ||||||
Ordinary shares, par value (in dollars per share) | $0.00 | $0.00 | $0.00 | $0.00 | ||||||||
Ordinary shares, shares authorized | 100,000,000 | 100,000,000 | 100,000,000 | 100,000,000 | 100,000,000 | 100,000,000 | 100,000,000 | 100,000,000 | ||||
Ordinary shares, shares issued | 49,930,944 | 49,930,944 | 49,030,944 | 49,030,944 | 49,930,944 | 49,930,944 | 49,030,944 | 49,030,944 | ||||
Ordinary shares, shares outstanding | 49,930,944 | 49,930,944 | 49,030,944 | 49,030,944 | 49,930,944 | 49,930,944 | 49,030,944 | 49,030,944 | ||||
Treasury shares, shares | 5,310,240 | 5,310,240 | 4,145,729 | 4,145,729 | 5,310,240 | 5,310,240 | 4,145,729 | 4,145,729 |
Restricted_Net_Assets_Details_1
Restricted Net Assets (Details 3) | 12 Months Ended | |||||||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
USD ($) | CNY | CNY | CNY | Parent company | Parent company | Parent company | Parent company | |
USD ($) | CNY | CNY | CNY | |||||
Operating expenses: | ||||||||
General and administrative expenses | ($9,359) | -58,071 | -52,565 | -54,367 | ($543) | -3,369 | -4,461 | -6,443 |
Total operating expenses | -53,824 | -333,956 | -258,102 | -215,330 | -543 | -3,369 | -4,461 | -6,443 |
Operating income | 361 | 2,245 | 53,983 | 51,788 | -543 | -3,369 | -4,461 | -6,443 |
Share of income of subsidiaries and VIEs | 3,264 | 20,251 | 61,151 | 59,671 | ||||
Interest income | 2,846 | 17,658 | 11,687 | 13,323 | 668 | 4,147 | 4,329 | 6,595 |
Foreign currency exchange (loss)/income , net | -219 | -1,361 | 1,935 | -1,845 | -248 | -1,536 | 2,239 | -1,829 |
Other income, net | 737 | 4,572 | 9,104 | 4,898 | 99 | 614 | 398 | 943 |
Income before income tax | 3,240 | 20,107 | 63,656 | 58,937 | ||||
Income tax expenses | -485 | -3,007 | -13,053 | -9,227 | ||||
Net income | 3,240 | 20,107 | 63,656 | 58,937 | 3,240 | 20,107 | 63,656 | 58,937 |
Net income | 3,240 | 20,107 | 63,656 | 58,937 | 3,240 | 20,107 | 63,656 | 58,937 |
Other comprehensive (loss)/income: | ||||||||
Foreign currency translation adjustments, net of tax of RMB nil | 287 | 1,780 | -9,018 | -772 | 290 | 1,799 | -9,083 | -775 |
Share of other comprehensive income/(loss) of subsidiaries and VIEs, net of tax of RMB nil | -3 | -19 | 65 | 3 | ||||
Other comprehensive (loss)/income | 287 | 1,780 | -9,018 | -772 | ||||
Comprehensive income | 3,527 | 21,887 | 54,638 | 58,165 | 3,527 | 21,887 | 54,638 | 58,165 |
Tax effect of foreign currency translation adjustments | 0 | 0 | 0 | 0 | 0 | 0 | ||
Tax effect of share of other comprehensive income/(loss) of subsidiaries and VIEs | 0 | 0 | 0 |
Restricted_Net_Assets_Details_2
Restricted Net Assets (Details 4) | 12 Months Ended | |||||||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
USD ($) | CNY | CNY | CNY | Parent company | Parent company | Parent company | Parent company | |
USD ($) | CNY | CNY | CNY | |||||
Condensed Cash Flow Statements, Captions [Line Items] | ||||||||
Cash flows provided by operating activities | $12,441 | 77,198 | 166,967 | 57,685 | $79 | 491 | 519 | 26,046 |
Cash flows provided by/(used in) investing activities | 11,323 | 70,258 | -111,747 | 78,960 | 27,053 | 167,853 | -23,823 | 146,504 |
Cash flows used in financing activities | -29,595 | -183,627 | -73,234 | -57,659 | -29,595 | -183,627 | -73,234 | -57,660 |
Effect of exchange rate changes on cash and cash equivalents | 69 | 415 | -7,082 | -2,617 | 42 | 260 | -6,844 | -2,604 |
Net increase/(decrease) in cash and cash equivalents | -5,762 | -35,756 | -25,096 | 76,369 | -2,421 | -15,023 | -103,382 | 112,286 |
Cash and cash equivalents at beginning of year | 37,490 | 232,613 | 257,709 | 181,340 | 11,824 | 73,365 | 176,747 | 64,461 |
Cash and cash equivalents at end of year | $31,728 | 196,857 | 232,613 | 257,709 | $9,403 | 58,342 | 73,365 | 176,747 |
Subsequent_Events_Details
Subsequent Events (Details) (Restricted Shares) | 1 Months Ended | 12 Months Ended | 0 Months Ended | |
Dec. 31, 2012 | Dec. 31, 2014 | Dec. 31, 2013 | Feb. 26, 2015 | |
Subsequent events | ||||
Granted (in shares) | 281,540 | 486,000 | 34,286 | |
First anniversary of the date of grant | ||||
Subsequent events | ||||
Percentage of awards subject to vest | 25.00% | |||
Pro-rata vesting on calendar quarter-end of each 12 quarters after first anniversary of grant | ||||
Subsequent events | ||||
Percentage of awards subject to vest | 75.00% | |||
Period of vesting of the remaining 75% awards granted | 12 | |||
Subsequent events. | Director and certain employees | ||||
Subsequent events | ||||
Granted (in shares) | 427,500 | |||
Number of director granted with restricted shares | 1 | |||
Service period | 4 years | |||
Subsequent events. | Director and certain employees | First anniversary of the date of grant | ||||
Subsequent events | ||||
Percentage of awards subject to vest | 25.00% | |||
Subsequent events. | Director and certain employees | Pro-rata vesting on calendar quarter-end of each 12 quarters after first anniversary of grant | ||||
Subsequent events | ||||
Percentage of awards subject to vest | 75.00% | |||
Period of vesting of the remaining 75% awards granted | 12 |