Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2015shares | |
Document and Entity Information | |
Entity Registrant Name | Leju Holdings Ltd |
Entity Central Index Key | 1,596,856 |
Document Type | 20-F |
Document Period End Date | Dec. 31, 2015 |
Amendment Flag | false |
Current Fiscal Year End Date | --12-31 |
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 | 139,229,418 |
Document Fiscal Year Focus | 2,015 |
Document Fiscal Period Focus | FY |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 260,295,909 | $ 317,811,056 |
Accounts receivable, net of allowance for doubtful accounts of $15,471,020 and $26,350,814 as of December 31, 2014 and 2015, respectively | 113,991,480 | 119,741,936 |
Deferred tax assets | 31,073,758 | 29,857,574 |
Customer deposits | 58,833,225 | |
Prepaid expenses and other current assets | 20,880,667 | 13,355,174 |
Amounts due from related parties | 8,906 | 684 |
Total current assets | 485,083,945 | 480,766,424 |
Property and equipment, net | 6,800,614 | 7,158,780 |
Intangible assets, net | 90,736,828 | 105,418,808 |
Investment in affiliates | 668,938 | 272,850 |
Goodwill | 39,807,243 | 40,563,075 |
Other non-current assets | 3,740,797 | 4,085,597 |
TOTAL ASSETS | 626,838,365 | 638,265,534 |
Current liabilities: | ||
Accounts payable (including accounts payable of the consolidated VIEs without recourse to Leju of $370,652 and $327,140 as of December 31, 2014 and 2015, respectively) | 327,140 | 370,652 |
Accrued payroll and welfare expenses (including accrued payroll and welfare expenses of the consolidated VIEs without recourse to Leju of $40,946,532 and $34,784,706 as of December 31, 2014 and 2015, respectively) | 45,691,874 | 48,007,240 |
Income tax payable (including income tax payable of the consolidated VIEs without recourse to Leju of $26,702,856 and $27,599,392 as of December 31, 2014 and 2015, respectively) | 66,814,874 | 57,246,193 |
Other tax payable (including other tax payable of the consolidated VIEs without recourse to Leju of $15,883,568 and $17,268,065 as of December 31, 2014 and 2015, respectively) | 31,930,296 | 27,804,416 |
Amounts due to related parties (including amounts due to related parties of the consolidated VIEs without recourse to Leju of $30,147,834 and $1,418,096 as of December 31, 2014 and 2015, respectively) | 10,214,007 | 5,289,491 |
Advance from customers and deferred revenue (including advance from customers and deferred revenue of the consolidated VIEs without recourse to Leju of $4,617,183 and $5,366,944 as of December 31, 2014 and 2015, respectively) | 5,703,085 | 5,054,408 |
Liability for accrued marketing and advertising expenses (including liability for accrued marketing and advertising expenses of the consolidated VIEs without recourse to Leju of $3,691,831 and $733,473 as of December 31, 2014 and 2015, respectively) | 3,914,990 | 19,269,565 |
Liability for unpaid consideration for acquiring non-controlling interest (including liability for unpaid consideration for acquiring non-controlling interest of the consolidated VIEs without recourse to Leju of $25,645,630 and $7,338,630 as of December 31, 2014 and 2015, respectively) | 7,338,593 | 25,645,630 |
Other current liabilities (including other current liabilities of the consolidated VIEs without recourse to Leju of $5,137,314 and $6,340,375 as of December 31, 2014 and 2015 respectively) | 7,672,494 | 8,613,203 |
Total current liabilities | 179,607,353 | 197,300,798 |
Deferred tax liabilities (including deferred tax liabilities, non-current of the consolidated VIEs without recourse to Leju of $469,579 and $523,874 as of December 31, 2014 and 2015, respectively) | 22,997,731 | 26,041,591 |
Total liabilities | $ 202,605,084 | $ 223,342,389 |
Commitments and contingencies (Note 15) | ||
Equity: | ||
Ordinary shares ($0.001 par value): 500,000,000 and 500,000,000 shares authorized, 134,015,621 and 134,930,870 shares issued and outstanding, as of December 31, 2014 and 2015, respectively | $ 134,931 | $ 134,015 |
Additional paid-in capital | 773,766,165 | 788,246,874 |
Accumulated deficit | (343,658,094) | (377,876,220) |
Subscription receivable | (9,200) | (688,989) |
Accumulated other comprehensive income (loss) | (5,521,547) | 5,029,663 |
Total Leju equity | 424,712,255 | 414,845,343 |
Non-controlling interest | (478,974) | 77,802 |
Total equity | 424,233,281 | 414,923,145 |
TOTAL LIABILITIES AND EQUITY | $ 626,838,365 | $ 638,265,534 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Accounts receivable, allowance for doubtful accounts | $ 26,350,814 | $ 15,471,020 |
Accounts payable | 327,140 | 370,652 |
Accrued payroll and welfare expenses | 45,691,874 | 48,007,240 |
Income tax payable | 66,814,874 | 57,246,193 |
Other tax payable | 31,930,296 | 27,804,416 |
Amounts due to related parties | 10,214,007 | 5,289,491 |
Advance from customers and deferred revenue | 5,703,085 | 5,054,408 |
Liability for accrued marketing and advertising expenses | 3,914,990 | 19,269,565 |
Liability for unpaid consideration for acquiring non-controlling interest | 7,338,593 | 25,645,630 |
Other current liabilities | 7,672,494 | 8,613,203 |
Deferred tax liabilities | $ 22,997,731 | $ 26,041,591 |
Common stock, par value (in dollars per share) | $ (0.001) | $ (0.001) |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 134,930,870 | 134,015,621 |
Common stock, shares outstanding | 134,930,870 | 134,015,621 |
Consolidated VIEs without recourse | ||
Accounts payable | $ 327,140 | $ 370,652 |
Accrued payroll and welfare expenses | 34,784,706 | 40,946,532 |
Income tax payable | 27,599,392 | 26,702,856 |
Other tax payable | 17,268,065 | 15,883,568 |
Amounts due to related parties | 1,418,096 | 30,147,834 |
Advance from customers and deferred revenue | 5,366,944 | 4,617,183 |
Liability for accrued marketing and advertising expenses | 733,473 | 3,691,831 |
Liability for unpaid consideration for acquiring non-controlling interest | 7,338,593 | 25,645,630 |
Other current liabilities | 6,340,375 | 5,137,314 |
Deferred tax liabilities | $ 523,874 | $ 469,579 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Revenues | |||
E-commerce | $ 420,552,177 | $ 326,679,871 | $ 170,204,545 |
Online advertising | 134,229,255 | 155,049,818 | 145,444,790 |
Listing | 21,022,504 | 14,293,184 | 19,772,181 |
Total revenues | 575,803,936 | 496,022,873 | 335,421,516 |
Cost of revenues | (60,313,726) | (51,129,730) | (63,990,693) |
Selling, general and administrative expenses | (475,445,516) | (366,341,900) | (226,142,936) |
Other operating income | 3,567,965 | 2,525,496 | 599,894 |
Income from operations | 43,612,659 | 81,076,739 | 45,887,781 |
Interest income | 1,167,005 | 1,316,203 | 1,082,287 |
Other income (loss), net | 290,039 | 35,799 | (1,185,121) |
Investment income | 271,501 | ||
Income before taxes and equity in affiliates | 45,341,204 | 82,428,741 | 45,784,947 |
Income tax expense | (10,307,322) | (15,545,964) | (3,065,725) |
Income before equity in affiliates | 35,033,882 | 66,882,777 | 42,719,222 |
Loss from equity in affiliates | (227,977) | (223,389) | (69,194) |
Net income | 34,805,905 | 66,659,388 | 42,650,028 |
Less: Net income (loss) attributable to non-controlling interest | (524,184) | 138,494 | 125,066 |
Net income attributable to Leju shareholders | $ 35,330,089 | $ 66,520,894 | $ 42,524,962 |
Earnings per share: | |||
Basic (in dollars per share) | $ 0.26 | $ 0.51 | $ 0.35 |
Diluted (in dollars per share) | $ 0.26 | $ 0.50 | $ 0.35 |
Shares used in computation: | |||
Basic (in shares) | 134,528,971 | 129,320,666 | 120,000,000 |
Diluted (in shares) | 136,223,974 | 132,502,100 | 120,000,000 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | |||
Net income | $ 34,805,905 | $ 66,659,388 | $ 42,650,028 |
Other comprehensive income (loss), net of tax of nil: | |||
Foreign currency translation adjustments | (10,586,435) | (605,736) | 2,712,069 |
Comprehensive income | 24,219,470 | 66,053,652 | 45,362,097 |
Less: Comprehensive income (loss) attributable to non-controlling interests | (559,409) | 129,794 | 280,424 |
Comprehensive income attributable to Leju shareholders | $ 24,778,879 | $ 65,923,858 | $ 45,081,673 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) | Total Leju Equity | Ordinary Shares | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Income | Subscription Receivable | Non-controlling Interest | Total |
Balance at Dec. 31, 2012 | $ 190,173,395 | $ 120,000 | $ 672,821,496 | $ (485,712,966) | $ 3,064,865 | $ (120,000) | $ 3,105,711 | $ 193,279,106 |
Balance (in shares) at Dec. 31, 2012 | 120,000,000 | |||||||
Increase (Decrease) in Stockholders' Equity | ||||||||
Net income | 42,524,962 | 42,524,962 | 125,066 | 42,650,028 | ||||
Capital contribution in connection with business acquisition | (6,459) | (6,459) | (6,459) | |||||
Capital contribution by non-controlling interest | 36,904 | 36,904 | ||||||
Dividend to non-controlling interest | (338,941) | (338,941) | ||||||
Share-based compensation | 310,504 | 416,632 | (106,128) | 310,504 | ||||
Cash contribution from E-House | 1,000 | 1,000 | 1,000 | |||||
Contribution From E - House | 15,527,623 | 15,527,623 | 15,527,623 | |||||
Deemed distribution to E-House associated with tax liability | (2,381,799) | (2,381,799) | (2,381,799) | |||||
Foreign currency translation adjustments | 2,556,711 | 2,556,711 | 155,358 | 2,712,069 | ||||
Balance at Dec. 31, 2013 | 248,705,937 | $ 120,000 | 686,378,493 | (443,294,132) | 5,621,576 | (120,000) | 3,084,098 | 251,790,035 |
Balance (in shares) at Dec. 31, 2013 | 120,000,000 | |||||||
Increase (Decrease) in Stockholders' Equity | ||||||||
Net income | 66,520,894 | 66,520,894 | 138,494 | 66,659,388 | ||||
Issuance of ordinary shares, net of issuance cost | 120,257,584 | $ 13,529 | 120,244,055 | 120,257,584 | ||||
Issuance of ordinary shares, net of issuance cost ( in shares) | 13,529,420 | |||||||
Share-based compensation | 8,345,796 | 9,448,778 | (1,102,982) | 8,345,796 | ||||
Changes in equity ownership on acquisition of non-controlling interest | (32,659,173) | (32,659,173) | (3,127,703) | (35,786,876) | ||||
Changes in equity ownership on partial disposal of subsidiary | 317,782 | 312,659 | 5,123 | (8,387) | 309,395 | |||
Payment for subscription receivable from E-House | 120,000 | 120,000 | 120,000 | |||||
Contribution From E - House | 2,857,251 | 2,857,251 | 2,857,251 | |||||
Deemed distribution to E-House associated with tax liability | (571,227) | (571,227) | (571,227) | |||||
Vesting of restricted shares | 1,012,000 | $ 220 | 1,011,780 | 1,012,000 | ||||
Vesting of restricted shares ( in shares) | 220,000 | |||||||
Exercise of share options | 535,535 | $ 266 | 1,224,258 | (688,989) | 535,535 | |||
Exercise of share options ( in shares) | 266,201 | |||||||
Foreign currency translation adjustments | (597,036) | (597,036) | (8,700) | (605,736) | ||||
Balance at Dec. 31, 2014 | 414,845,343 | $ 134,015 | 788,246,874 | (377,876,220) | 5,029,663 | (688,989) | 77,802 | $ 414,923,145 |
Balance (in shares) at Dec. 31, 2014 | 134,015,621 | 134,015,621 | ||||||
Increase (Decrease) in Stockholders' Equity | ||||||||
Net income | 35,330,089 | 35,330,089 | (524,184) | $ 34,805,905 | ||||
Dividends to shareholders | (26,873,022) | (26,873,022) | (26,873,022) | |||||
Dividend to non-controlling interest | (10,260) | (10,260) | ||||||
Share-based compensation | 9,366,815 | 10,478,778 | (1,111,963) | 12,893 | 9,379,708 | |||
Vesting of restricted shares | 1,012,000 | $ 719 | 1,011,281 | 1,012,000 | ||||
Vesting of restricted shares ( in shares) | 719,064 | |||||||
Exercise of share options | 1,582,240 | $ 197 | 902,254 | 679,789 | 1,582,240 | |||
Exercise of share options ( in shares) | 196,185 | |||||||
Foreign currency translation adjustments | (10,551,210) | (10,551,210) | (35,225) | (10,586,435) | ||||
Balance at Dec. 31, 2015 | $ 424,712,255 | $ 134,931 | $ 773,766,165 | $ (343,658,094) | $ (5,521,547) | $ (9,200) | $ (478,974) | $ 424,233,281 |
Balance (in shares) at Dec. 31, 2015 | 134,930,870 | 134,930,870 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Operating activities: | |||
Net income | $ 34,805,905 | $ 66,659,388 | $ 42,650,028 |
Adjustments to reconcile net loss to net cash provided by operating activities: | |||
Depreciation and amortization | 29,279,835 | 26,118,778 | 38,342,931 |
Loss from equity in affiliates | 227,977 | 223,389 | 69,194 |
Investment income | (271,501) | ||
Allowance for doubtful accounts | 18,959,895 | 11,599,708 | 6,373,132 |
Share-based compensation | 11,518,112 | 8,880,397 | 310,504 |
Amortization of discounts related to liability for exclusive rights | 52,922 | 935,177 | |
Others | 274,263 | 35,709 | 20,664 |
Changes in operating assets and liabilities: | |||
Accounts receivable | (12,189,414) | (45,417,127) | (7,325,344) |
Customer deposits | (58,833,225) | ||
Amounts due from related parties | (8,222) | 3,471,274 | (3,882,437) |
Prepaid expenses and other current assets | (8,334,672) | (4,236,540) | (1,531,557) |
Other non-current assets | (264,398) | (247,654) | (281,717) |
Accounts payable | (42,576) | (1,051,548) | (301,228) |
Accrued payroll and welfare expenses | (2,265,584) | 17,515,586 | 10,398,953 |
Income tax payable | 9,774,416 | 15,249,420 | 20,119,753 |
Other tax payable | 4,214,594 | 9,297,217 | 8,320,720 |
Amounts due to related parties | 48,449,802 | 4,381,372 | (21,644,489) |
Other current liabilities and accrued expenses | (16,319,318) | 14,668,180 | 8,930,136 |
Deferred taxes | (7,700,893) | (2,369,482) | (18,081,440) |
Net cash provided by operating activities | 51,274,996 | 124,830,989 | 83,422,980 |
Investing activities: | |||
Deposit for and purchase of property and equipment and intangible assets | (14,810,650) | (12,122,678) | (16,957,279) |
Investment in affiliates | (369,595) | (245,138) | (246,027) |
Proceeds from disposal of property and equipment | 80,472 | 12,400 | 546,373 |
Net cash used in investing activities | (15,099,773) | (12,355,416) | (16,656,933) |
Financing activities: | |||
Contribution from non-controlling interest | 36,904 | ||
Refund loans to related parties | (42,513,286) | (43,818,894) | |
Advance from related parties | 276,000 | 2,760,000 | |
Contribution from E-House | 120,000 | 1,000 | |
Dividends to non-controlling interests | (10,260) | (338,941) | |
Proceeds from issuance of ordinary shares, net of paid issuance costs of $15,036,616 | 120,257,584 | ||
Proceeds from exercise of options | 1,582,240 | 535,535 | |
Acquisition of non-controlling interest of subsidiaries | (17,360,080) | (14,418,056) | |
Dividends to shareholders | (26,873,022) | ||
Proceeds from partial disposal of subsidiaries | 309,395 | ||
Net cash provided by (used in) financing activities | (85,174,408) | 107,080,458 | (41,359,931) |
Effect of exchange rate changes on cash and cash equivalents | (8,515,962) | (474,614) | 2,233,257 |
Net increase (decrease) in cash and cash equivalents | (57,515,147) | 219,081,417 | 27,639,373 |
Cash and cash equivalents at the beginning of the year | 317,811,056 | 98,729,639 | 71,090,266 |
Cash and cash equivalents at the end of the year | 260,295,909 | 317,811,056 | 98,729,639 |
Supplemental disclosure of cash flow information: | |||
Income taxes paid | 5,196,133 | 1,953,177 | 1,478,483 |
Non-cash investing and financing activities: | |||
Additional paid in capital recognized in connection with business acquisition | (6,459) | ||
Consideration payable for amount recognized in purchase of exclusive rights | (8,967,972) | ||
Related party loans waived and recorded as a capital contribution | 1,000 | ||
Related party payable recorded as a capital contribution | 2,857,251 | 15,527,623 | |
Deemed distribution to E-House associated with tax liability | (571,227) | $ (2,381,799) | |
Decrease in amount due to related party due to vesting of restricted shares | 1,012,000 | 1,012,000 | |
Payables for acquisition of non-controlling interest | $ (7,338,593) | $ (25,645,630) |
CONSOLIDATED STATEMENTS OF CAS8
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) | 12 Months Ended |
Dec. 31, 2014USD ($) | |
CONSOLIDATED STATEMENTS OF CASH FLOWS | |
Issuance costs | $ 15,036,616 |
Organization and Principal Acti
Organization and Principal Activities | 12 Months Ended |
Dec. 31, 2015 | |
Organization and Principal Activities | |
Organization and Principal Activities | 1. Organization and Principal Activities Leju Holdings Limited (the “Company” or “Leju”) was incorporated on November 20, 2013 in the Cayman Islands as an exempted company with limited liability under the Companies Law of the Cayman Islands. The Company, through its subsidiaries and consolidated variable interest entities (“VIEs”), is principally engaged in providing online advertising, e-commerce services and listing services in the People’s Republic of China (“PRC”). The Company, its subsidiaries and consolidated VIEs are collectively referred to as the “Group”. E-House (China) Holdings Limited (“E-House Holdings”) is the Company’s parent company. E-House Holdings, its subsidiaries and VIEs, excluding the Group, are collectively referred to as “E-House”. On February 24, 2008, E-House entered into a joint venture agreement with SINA Corporation (“SINA”) to form China Online Housing Technology Corporation (“COHT”), a joint venture to operate SINA’s real estate and home furnishing channels and related business and provide online advertising services related to the real estate and home furnishing industries in China through a consolidated VIE, Beijing Yisheng Leju Information Service Co., Ltd. (“Beijing Leju”). SINA and E-House owned 66% and 34%, respectively, of the equity interest in COHT. In October 2009, China Real Estate Information Corporation (“CRIC”), a subsidiary of E-House, acquired SINA’s 66% interest in COHT and COHT became a wholly-owned subsidiary of CRIC. In April 2012, E-House Holdings acquired all the outstanding shares of CRIC that it did not already own (the “Merger”). As a result, CRIC became a wholly-owned subsidiary of E-House Holdings. E-House retained the controlling interest in CRIC before and after the Merger. In October 2010, CRIC established a new subsidiary, Omnigold Holdings Limited (“Omnigold”), in the British Virgin Islands. In March 2012, COHT transferred its assets and staff relating to the home furnishing business to Beijing Jiajujiu E-Commerce Co., Ltd. (“Beijing Jiajujiu”), which is a VIE controlled by Omnigold. In June 2011, CRIC established another subsidiary, China E-Real Estate Holdings Limited (“E-Real”), in the British Virgin Islands. In November 2011, Shanghai Yi Xin E-Commerce Co., Ltd. (“Shanghai Yi Xin”), was established to operate e-commerce business. Shanghai Yi Xin is a VIE controlled by E-Real through contractual arrangements. E-House City Rehouse Real Estate Agency (Shanghai) Limited (“City Rehouse”) was incorporated in 2010 as a wholly owned subsidiary of E-House China (Tianjin) Holdings Limited (“E-House Tianjin”), a company incorporated in the British Virgin Islands and ultimately wholly controlled by E-House Holdings. Historically City Rehouse was engaged in providing secondary real estate brokerage services in Shanghai and e-commerce business. As part of the Reorganization as defined below, the secondary real estate brokerage services have been transferred to entities outside of the Group, and City Rehouse will only be engaged in e-commerce business subsequent to the Reorganization. Therefore the historical financial results associated with the secondary real estate brokerage services were not included in the Group’s consolidated financial statements, while the historical financial results of e-commerce business have been included in the consolidated financial statements for all periods presented. In December 2013, E-House transferred all its equity interests in COHT, Omnigold, E-Real and E-House Tianjin to the Company. The restructuring process has been accounted for as a legal reorganization of entities under common control (the “Reorganization”). Upon incorporation, the Company had 500,000,000 ordinary shares authorized, 50,000 ordinary shares issued and outstanding with a par value of $1.00 per share, all of which were held by E-House Holdings. On December 19, 2013, the Company effected a 1:1,000 share split, resulting in 50,000,000 ordinary shares issued and outstanding with a par value of $0.001 per share. The Company also issued additional 70,000,000 ordinary shares to E-House Holdings for par value, or $70,000. As a result, the Company has 120,000,000 ordinary shares issued and outstanding, all of which are held by E-House Holdings. The ordinary share issuance to E-House Holdings has been retroactively reflected for all periods presented herein. In addition, E-House historically has provided intercompany loans to COHT, Omnigold and E-House Tianjin in order for these entities to fund capital injections of their respective PRC subsidiaries. These loans were capital in nature and considered permanently invested in the subsidiaries. As part of the Reorganization, E-House transferred such investments to the Company in the legal form of waived loans, which were reflected as a capital contribution from E-House in the Company’s consolidated statements of changes in equity. The accompanying consolidated financial statements have been prepared as if the current corporate structure has been in existence throughout the periods presented, and the waived loans were reflected as a capital contribution as of the date such loans were originally made due to their nature of capital investment. On March 21, 2014, the Company entered into a share purchase and subscription agreement with E-House Holdings and THL O Limited, a wholly-owned subsidiary of Tencent Holdings Limited (“Tencent’’ are to Tencent Holdings Limited or certain of its affiliates which have entered into agreements with the Company), pursuant to which Tencent has acquired from E-House Holdings 19,201,800 of Leju’s ordinary shares for $180 million in cash. On April 17, 2014, the Company’s ADSs began trading on the NEW YORK STOCK EXCHANGE, or the NYSE under the symbol “LEJU”. Including the exercise of an over-allotment option, the Company issued a total of 11,500,000 ADSs, representing 11,500,000 ordinary shares, at an initial offering price of $10.00 per ADS. Concurrent with this offering, the Company also issued and sold 2,029,420 ordinary shares in the private placement to Tencent at $10.00 per share. The Company raised from this initial public offering approximately $101.4 million in net proceeds after deducting underwriting commissions and the offering expenses payable by the Company. Concurrently with the initial public offering, the Company also raised from Tencent in a private placement $18.9 million in net proceeds after deducting estimated fees and expenses payable by the Company. The following table lists major subsidiaries and the consolidated VIEs of the Company as of December 31, 2015: Date of Incorporation Place of Incorporation Percentage of Ownership Shanghai SINA Leju Information Technology Co., Ltd (“Shanghai SINA Leju”) 08-May-08 PRC % City Rehouse 04-Mar-10 PRC % Shanghai Yi Yue Information Technology Co., Ltd (“Shanghai Yi Yue”) 16-Sep-11 PRC % Beijing Maiteng Fengshun Science and Technology Co., Ltd (“Beijing Maiteng”) 04-Jan-12 PRC % Beijing Leju 13-Feb-08 PRC VIE Shanghai Yi Xin 05-Dec-11 PRC VIE Beijing Jiajujiu 22-Mar-12 PRC VIE The Group’s consolidated financial statements for the periods prior to the Company’s initial public offering (“IPO”) in April 2014 have been prepared on a carve-out basis and represent the assets and liabilities and the related results of operations and cash flows of the Group, which represent the online segment of E-House. The financial data of previously separate entities have been combined, to the extent included in the online segment of E-House, for all periods presented as all such entities were under common control. However, such presentation may not necessarily reflect the results of operations, financial position and cash flows if the Group had actually existed on a stand-alone basis during the periods presented. Transactions between the Group and E-House are herein referred to as related party transactions. In connection with a contemplated IPO of the Company, the Company entered into non-competition arrangements with E-House Holdings, according to which E-House has agreed not to compete with the Group in online services business anywhere in the world and the Group has agreed not to compete with E-House in any services currently provided or contemplated by E-House other than online services. Prior to these non-competition arrangements, E-House and the Group did not have competition in the services provided. The consolidated financial statements include the Group’s direct expenses as well as allocations for various selling, general and administrative expenses of E-House that are not directly related to online services. These expenses consist primarily of share-based compensation expenses of senior management and shared marketing and management expenses including accounting, administrative, marketing, internal control, customer service support and legal support services. These allocations were made using a proportional cost allocation method and were based on revenues, headcount as well as estimates of actual time spent on the provision of services attributable to the Group. Management believes these allocations are reasonable. Total selling, general and administrative expenses allocated from E-House are $15,527,623 and $2,857,251 for the year ended December 31, 2013 and for the period from January 1, 2014 to the IPO date, respectively, recorded as capital contribution by E-House. Income tax provision reflected in the Company’s Consolidated Statements of Operations is calculated based on a separate return basis as if the Group had filed a separate tax return. Subsequent to the IPO, E-House began charging the Group transitional corporate service fees pursuant to agreements entered into in March 2014 in connection with the IPO. Under these transitional services arrangements, E-House provides various corporate support services to the Group, including general finance and accounting, human resource management, administrative, internal control and internal audit, operational management, legal and information technology. E-House charges the Group a fee based on an estimate of the actual cost incurred to provide such services, which amounted to $10,399,978 and $6,040,071 for the period from the IPO date to December 31, 2014 and for the year ended December 31, 2015. |
Summary of Principal Accounting
Summary of Principal Accounting Policies | 12 Months Ended |
Dec. 31, 2015 | |
Summary of Principal Accounting Policies | |
Summary of Principal Accounting Policies | 2. Summary of Principal Accounting Policies (a) Basis of presentation The consolidated financial statements are prepared and presented in accordance with accounting principles generally accepted in the United States of America (“US GAAP”). (b) Basis of consolidation The consolidated financial statements include the financial statements of Leju, its majority owned subsidiaries and its VIEs, Beijing Leju, Shanghai Yi Xin and Beijing Jiajujiu. All inter-company transactions and balances have been eliminated in consolidation. The Group evaluates each of its interests in private companies to determine whether or not the investee is a VIE and, if so, whether the Group is the primary beneficiary of such VIE. In determining whether the Group is the primary beneficiary, the Group considers if the Group (1) has power to direct the activities that most significantly affects the economic performance of the VIE, and (2) receives the economic benefits of the VIE that could be significant to the VIE. If deemed the primary beneficiary, the Group consolidates the VIE. The VIE arrangements PRC regulations currently prohibit or restrict foreign ownership of companies that provide internet content and advertising services. To comply with these regulations, the Group provides such activities relating to real estate projects through its VIEs and their subsidiaries. To provide the Group effective control over and the ability to receive substantially all of the economic benefits of its VIEs and their subsidiaries, certain of the Company’s subsidiaries, Shanghai SINA Leju, Shanghai Yi Yue and Maiteng (collectively, the “Foreign Owned Subsidiaries”) entered into a series of contractual arrangements with Beijing Leju, Shanghai Yi Xin and Beijing Jiajujiu (collectively the “VIEs”) and their respective shareholders, respectively, as summarized below: Name of Foreign Owned Subsidiaries Foreign Owned Subsidiaries’ Economic Ownership of VIES Name of VIEs Activities of VIEs Shanghai SINA Leju % Beijing Leju Operate the online advertising and listing business Shanghai Yi Yue % Shanghai Yi Xin Operate the e-commerce business Beijing Maiteng % Beijing Jiajujiu Operate the online home furnishing business The VIEs hold the requisite licenses and permits necessary to conduct internet content and advertising services activities relating to real estate projects from which foreign ownership of companies are prohibited or restricted. In addition, the VIEs hold leases and other assets necessary to operate such business and generate a majority of the Group’s revenues. Agreements that Transfer Economic Benefits of the VIEs to the Group Exclusive Consulting and Technical Support Agreement. Pursuant to an exclusive consulting and technical support agreement between the Foreign Owned Subsidiaries and the respective VIEs, the Foreign Owned Subsidiaries provide the respective VIEs with a series of consulting and technical support services and are entitled to receive related fees. The term of this exclusive technical support agreement will expire upon dissolution of the VIEs. Unless expressly provided by this agreement, without prior written consent of the Foreign Owned Subsidiaries, the VIEs may not engage any third party to provide the services offered by the Foreign Owned Subsidiaries under this agreement. Agreements that Provide Effective Control over VIEs Exclusive Call Option Agreement. Each of shareholders of the VIEs has entered into an exclusive call option agreement with the respective Foreign Owned Subsidiaries. Pursuant to these agreements, each of the shareholders of the VIEs has granted an irrevocable and unconditional option to the respective Foreign Owned Subsidiaries or their designees to acquire all or part of such shareholder’s equity interests in VIEs at its sole discretion, to the extent as permitted by PRC laws and regulations then in effect. The consideration for such acquisition of all equity interests in the VIEs will be equal to the registered capital of the VIEs, and if PRC law requires the consideration to be greater than the registered capital, the consideration will be the minimum amount as permitted by PRC law. In addition, the VIEs irrevocably and unconditionally granted the respective Foreign Owned Subsidiaries an exclusive option to purchase, to the extent permitted under the PRC law, all or part of the assets of the VIEs. The exercise price for purchasing the assets of the VIEs will be equal to their respective book values, and if PRC law requires the price to be greater than the book value, the price will be the minimum amount as permitted by PRC law. The call option may be exercised by the respective Foreign Owned Subsidiaries or their designees. Loan Agreement. Under the loan agreement among shareholders of the VIEs and the respective Foreign Owned Subsidiaries, the respective Foreign Owned Subsidiaries granted an interest-free loan to the shareholders of the VIEs, solely for their purchase of the equity interest of the VIEs, investing or operating activities conducted in the VIEs. Each loan agreement has a term of twenty years. Shareholder Voting Right Proxy Agreement. Each of the shareholders of the VIEs irrevocably grant any person designated by the respective Foreign Owned Subsidiaries the power to exercise all voting rights to which he will be entitled to as shareholder of the VIEs at that time, including the right to declare dividends, appoint and elect board members and senior management members and other voting rights. Each shareholder voting right proxy agreement has a term of twenty years, unless it is early terminated by all parties in writing or pursuant to provision of this agreement. The term of the agreement will be automatically extended for one year upon the expiration, if the Foreign Owned Subsidiary gives the other parties written notice requiring the extension thereof and the same mechanism will apply subsequently upon the expiration of each extended term. Equity Pledge Agreement. Each of the shareholders of the VIEs has also entered into an equity pledge agreement with the respective Foreign Owned Subsidiaries. Pursuant to which these shareholders pledged their respective equity interest in the VIEs to guarantee the performance of the obligations of the VIEs. The Foreign Owned Subsidiaries, as pledgee, will be entitled to certain rights, including the right to sell the pledged equity interests. Pursuant to the equity pledge agreement, each shareholder of the VIEs cannot transfer, sell, pledge, dispose of or otherwise create any new encumbrance on their respective equity interest in the VIEs without the prior written consent of the respective Foreign Owned Subsidiaries. The equity pledge right enjoyed by the Foreign Owned Subsidiaries will expire when shareholders of the VIEs have fully performed their respective obligations under the above agreements. The equity pledges of the VIEs have been registered with the relevant local branch of the State Administration for Industry and Commerce, or SAIC. Risks in relation to the VIE structure The Company believes that the Foreign Owned Subsidiaries’ contractual arrangements with the VIEs are in compliance with PRC law and are legally enforceable. However, uncertainties in the PRC legal system could limit the Company’s ability to enforce these contractual arrangements and the interests of the shareholders of the VIEs may diverge from that of the Company and that may potentially increase the risk that they would seek to act contrary to the contractual terms, for example by influencing the VIEs not to pay the service fees when required to do so. The Company’s ability to control the VIEs also depends on the power of attorney the Foreign Owned Subsidiaries have to vote on all matters requiring shareholder approval in the VIEs. As noted above, the Company believes this power of attorney is legally enforceable but may not be as effective as direct equity ownership. In addition, if the legal structure and contractual arrangements were found to be in violation of any existing PRC laws and regulations, the Company may be subject to fines or other actions. The Company does not believe such actions would result in the liquidation or dissolution of the Company, the Foreign Owned Subsidiaries or the VIEs. The Company, through its subsidiaries and through the contractual arrangements, has (1) the power to direct the activities of the VIEs that most significantly affect the entity’s economic performance and (2) the right to receive benefits from the VIEs. Accordingly, the Company is the primary beneficiary of the VIEs and has consolidated the financial results of the VIEs. The following financial statement amounts and balances of the Group’s VIEs were included in the accompanying consolidated financial statements: As of December 31, 2014 2015 $ $ Cash and cash equivalents Accounts receivable, net of allowance for doubtful accounts Customer deposits — Amounts due from related parties Other current assets Total current assets Total non-current assets Total assets Accounts payable Accrued payroll and welfare expenses Income tax payable Other tax payable Amounts due to related parties Advance from customers Liability for accrued marketing and advertising expenses Liability for unpaid consideration of acquiring non-controlling interest Other current liabilities Total current liabilities Deferred tax liabilities, non-current Total liabilities Year Ended December 31, 2013 2014 2015 $ $ $ Total revenues Cost of revenues ) ) ) Net income Net cash provided by operating activities Net cash used in investing activities ) ) ) Net cash used in financing activities ) ) ) There are no consolidated VIEs’ assets that are collateral for the VIEs’ obligations or are restricted solely to settle the VIEs’ obligations. The Company has not provided any financial support that it was not previously contractually required to provide to the VIEs. (c) Use of estimates The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from such estimates. Significant accounting estimates reflected in the Group’s financial statements include useful lives and valuation of long-lived assets, evaluation of goodwill, allowance for doubtful accounts, assumptions related to share-based compensation arrangements, assumptions related to the consolidation of entities in which the Group holds variable interests, valuation allowance on deferred tax, and selling price hierarchy in multiple-deliverable revenue arrangements. (d) Fair value of financial instruments The Group may have certain of its financial assets and liabilities at fair value on a recurring basis. Fair value reflects the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Company considers the principal or most advantageous market in which it would transact and considers assumptions that market participants would use when pricing the asset or liability. The Group applies a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. There are three levels of inputs that may be used to measure fair value: Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities. 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 asset or liability 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 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. There are no assets or liabilities measured at fair value on a recurring basis subsequent to initial recognition. There were no assets or liabilities measured at fair value on a nonrecurring basis in 2013, 2014 and 2015. For cash and cash equivalents, accounts receivable, customer deposits, other receivables, accounts payable, other payables, and amounts due from/to related parties, the carrying value approximates the fair value due to their short-term nature. (e) Business combinations Business combinations are recorded using the purchase method of accounting and, accordingly, the acquired assets and liabilities are recorded at their fair market value at the date of acquisition. Any excess of acquisition cost over the fair value of the acquired assets and liabilities, including identifiable intangible assets, is recorded as goodwill. (f) Cash and cash equivalents Cash and cash equivalents consist of cash on hand and demand deposits, which are unrestricted as to withdrawal and use, and which have original maturities of three months or less. (g) Customer deposits The Group provides online e-commerce services for customers. Some real estate developers require the Group to pay an upfront and refundable deposit to obtain the exclusive e-commerce services agreement of the real estate development projects. These deposits are refunded to the Group subject to certain pre-determined criteria specified in the contracts. Customer deposits are recorded as either current or non-current assets based on the Group’s estimate of the date of refund. As of December 31, 2015, all customer deposit are refundable within 12 months and none of them passed the original due date. (h) Investment in affiliates Affiliated companies are entities over which the Group has significant influence, but which it does not control. The Group generally considers an ownership interest of 20% in common stock or higher to represent a presumption that they are able to exert significant influence. Investments in affiliates are accounted for by the equity method of accounting. Under this method, the Group’s share of the post-acquisition profits or losses of affiliated companies is recognized in the income statement and its share of post-acquisition movements in other comprehensive income is recognized in other comprehensive income. Unrealized gains on transactions between the Group and its affiliated companies are eliminated to the extent of the Group’s interest in the affiliated companies; unrealized losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. When the Group’s share of losses in an affiliated company equals or exceeds its interest in the affiliated company, the Group does not recognize further losses, unless the Group has incurred obligations or made payments on behalf of the affiliated company. The Group is required to perform an impairment assessment of its investments whenever events or changes in business circumstances indicate that the carrying value of the investment may not be fully recoverable. An impairment loss is recorded when there has been a loss in value of the investment that is other than temporary. The Group has not recorded any impairment losses in any of the periods reported. As of December 31, 2014 and 2015, the Group determined that no such events were present. (i) Property and equipment, net Property and equipment is recorded at cost less accumulated depreciation. Depreciation is computed on a straight-line basis over the following estimated useful lives: Leasehold improvements Over the shorter of the lease term or their estimated useful lives Buildings 30 years Furniture, fixtures and equipment 3-5 years Motor vehicles 5 years Gains and losses from the disposal of property and equipment are included in income from operations. (j) Intangible assets, net Acquired intangible assets mainly consist of advertising agency agreement and license agreements with SINA, exclusive rights with Baidu, Inc. (“Baidu”), customer relationships, Database license, and non-compete agreements from business combinations and are recorded at fair value on the acquisition date. All intangible assets, with the exception of customer relationships, are amortized ratably over the contract period. Intangible assets resulting out of acquired customer relationships are amortized based on the timing of the revenue expected to be derived from the respective customer. (k) Impairment of long-lived assets The Group evaluates its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. When these events occur, the Group measures impairment by comparing the carrying amount of the assets to future undiscounted net cash flows expected to result from the use of the assets and their eventual disposition. If the sum of the expected undiscounted cash flow is less than the carrying amount of the assets, the Group would recognize an impairment loss equal to the excess of the carrying amount over the fair value of the assets. (l) Impairment of goodwill and indefinite lived intangible assets The Group performs an annual goodwill impairment test comprised of two steps. The first step compares the fair value of the Group to its carrying amount, including goodwill and indefinite lived intangible assets. If the fair value of the Group exceeds its carrying amount, goodwill is not considered to be impaired and the second step will not be required. If the carrying amount of the Group exceeds its fair value, the second step compares the implied fair value of goodwill and indefinite lived intangible assets to the carrying value of the Group’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 determined in the first step to the assets and liabilities of the Group. The excess of the fair value of the Group over the amounts assigned to the assets and liabilities is the implied fair value of goodwill. This allocation process is only performed for 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 of goodwill over the implied fair value of goodwill. Management performs a goodwill impairment test at the Group level as of December 31 of each year or when there is a triggering event causing management to believe it is more likely than not that the carrying amount of goodwill may be impaired. Intangible assets with an indefinite life are tested for impairment annually or more frequently if events or changes in circumstances indicate that the asset might be impaired. The impairment test consists of a comparison of the fair value of the intangible asset to its carrying amount. If the carrying amount exceeds the fair value, an impairment loss is recognized equal in amount to that excess. (m) Income taxes Deferred income taxes are recognized for temporary differences between the tax basis of assets and liabilities, and their reported amounts in the financial statements, net operating loss carry forwards and credits by applying enacted statutory tax rates applicable to future years when the reported amounts of the asset or liability are expected to be recovered or settled, respectively. Deferred tax assets are reduced by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Current income taxes are provided for in accordance with the laws of the relevant taxing authorities. The components of the deferred tax assets and liabilities are individually classified as current and non-current based on the classification of the related assets and liabilities for financial reporting purposes. The Group only recognizes tax benefits related to uncertain tax positions when such positions are more likely than not of being sustained upon examination. For such positions, the amount of tax benefit that the Group recognizes is the largest amount of tax benefit that is more than fifty percent likely of being sustained upon the ultimate settlement of such uncertain position. The Group records interest and penalties as a component of income tax expense. (n) Share-based compensation Share-based compensation cost is measured on the grant date, based on the fair value of the award, and recognized as an expense over the requisite service period. Management has made an estimate of expected forfeitures and recognizes compensation cost only for those equity awards expected to vest. (o) Revenue recognition The Group recognizes revenue when there is persuasive evidence of an arrangement, service has been rendered, the sales price is fixed or determinable and collectability is reasonably assured. Revenues are recorded, net of sales related taxes. The Group generates real estate online revenues principally from e-commerce, online advertising, and listing services. The Group e-commerce services primarily include discount coupon advertising and online property auctions. The Group also provides property viewing and pre-sale customer support free of charge in connection with the sale of discount coupons and online property auctions. E-commerce revenues are principally generated from selling discount coupons to potential property buyers. Those discount coupons allow buyers to purchase specified properties from real estate developers at discounts greater than the face value of the fees charged by the Group. The discount coupons are refundable to the buyers at any time before they are used to purchase the specified properties. The Group recognizes such e-commerce revenues upon obtaining confirmation letters that prove the use of coupons by property buyers, and when collections are reasonably assured. Revenues are recognized based on the net proceeds received as the Group acts as a marketing agent of the property developer in the transaction. Revenue from online advertising services is generated principally from online advertising arrangements, sponsorship arrangements, and to a lesser extent, outsourcing arrangements, and keyword advertising arrangements. Online advertising arrangements allow advertisers to place advertisements on particular areas of the Group’s websites, in particular formats and over particular periods of time. Advertising revenues from online advertising arrangements are recognized ratably over the contract period of display when collectability is reasonably assured. Sponsorship arrangements allow advertisers to sponsor a particular area on the Group’s websites in exchange for a fixed payment over the contract period. Advertising revenues from sponsorship arrangements are recognized ratably over the contract period. The Group also generates online advertising revenues from outsourcing certain regional sites for a fixed period of time to local outsourcing partners, who are responsible for both website operation and related advertising sales. Advertising revenues from hosted websites are recognized ratably over the term of the contract. Keyword advertising revenues are recognized ratably over the contract period when collectability is reasonably assured. The Group also provides listing services to real estate brokers. Listing services entitle real estate brokers to post and make changes to information for properties in a particular area on the website for a specified period of time, in exchange for a fixed fee. Listing revenues are recognized ratably over the contract period of display when collectability is reasonably assured. There are no multiple elements arrangements within the services provided by the Group. However, E-House has multiple element arrangements that may include provision of online advertising services provided by the Group. The total amounts of revenue earned by the Group related to agreements that have been accounted for as multiple element arrangements by E-House were $5,556,867, $4,836,931 and $3,689,272 in 2013, 2014 and 2015, respectively. Deferred revenues are recognized when payments are received in advance of revenue recognition. (p) Cost of revenue Cost of revenue consists of costs associated with the production of websites, which includes fees paid to third parties for internet connection, content and services, editorial personnel related costs, amortization of intangible assets, depreciation associated with website production equipment and fees paid to SINA for advertising on non-real estate channels. (q) Marketing and advertising expenses Marketing and advertising expenses consists primarily of targeted online and offline marketing costs for promoting our e-commerce projects, increasing our visibility and building our brand, such as Leju property visit, sponsored marketing campaigns, online or print advertising, public relations and sponsored events. The Company expenses all marketing advertising costs as incurred and record these costs within “Selling, general and administrative expenses” on the consolidated statements of operations when incurred. The nature of the Company’s direct marketing activities is such that they are intended to attract subscribers for the online advertising and potential property buyers to purchase the discount coupons. The Group incurred marketing and advertising expenses amounting to $96,288,501, $196,396,734 and $306,846,482 for the years ended December 31, 2013, 2014 and 2015, respectively. (r) Foreign currency translation The functional currency of the Company is the United States dollar (“U.S. dollar”) and is used as the reporting currency of the Group. Monetary assets and liabilities denominated in currencies other than the U.S. dollar are translated into U.S. dollar at the rates of exchange ruling at the balance sheet date. Equity accounts are translated at historical exchange rates and revenues, expenses, gains and losses are translated using the average rate for the year. Translation adjustments are reported as foreign currency translation adjustment and are shown as a separate component of other comprehensive income in the consolidated statements of changes in equity and comprehensive income. The financial records of certain of the Company’s subsidiaries are maintained in local currencies other than the U.S. dollar, such as Renminbi (“RMB”) and Hong Kong dollar (“HKD”), which are their functional currencies. Transactions in other currencies are recorded at the rates of exchange prevailing when the transactions occur. Transaction gains and losses are recognized in the consolidated statements of operations. The Group recorded an exchange loss of $249,944, an exchange gain $88,721 and $156,641 for the years ended December 31, 2013, 2014 and 2015, respectively, as a component of other loss, net. (s) Government subsidies Government subsidies include cash subsidies received by the Company’s subsidiaries in the PRC from local governments. These subsidies are generally provided as incentives for conducting business in certain local districts and are typically granted based on the amount of value-added tax, business tax, and income tax payment generated by the Group in certain local districts. Such subsidies allow the Group full discretion in utilizing the funds and are used by the Group for general corporate purpose. The local governments have final discretion as to the amount of cash subsidies. Cash subsidies of $599,894, $2,525,496 and $3,567,965 were included in other operating income for the years ended December 31, 2013, 2014 and 2015, respectively. Subsidies are recognized when cash is received and when all the conditions for their receipt have been satisfied. (t) Concentration of credit risk Financial instruments that potentially expose the Group to concentrations of credit risk consist primarily of cash and cash equivalents, accounts receivable and customer deposit. The Group places its cash and cash equivalents with reputable financial institutions. The Group regularly reviews the creditworthiness of its customers, and requires collateral or other security from its customers in certain circumstances when accounts receivables’ aging is over one year. The Group establishes an allowance for doubtful accounts primarily based upon factors surrounding the credit risk of specific customers, including creditworthiness of the clients, aging of the receivables and other specific circumstances related to the accounts. Movement of the allowance for doubtful accounts for accounts receivable is as follows: Year Ended December 31, 2013 2014 2015 $ $ $ Balance as of January 1 Provisions for doubtful accounts Write offs ) ) ) Changes due to foreign exchange ) ) Balance as of December 31 The allowance for other receivables was nil for all periods presented. (u) Earnings per share Basic earnings per share are computed by dividing income attributable to holders of ordinary shares by the weighted average number of ordinary shares outstanding during the period. Diluted earnings per ordinary share reflects the potential dilution that could occur if securities or other contracts to issue ordinary shares were exercised or converted into ordinary shares. The following table sets forth the computation of basic and diluted income per share for the periods indicated: Year Ended December 31, 2013 2014 2015 Net income attributable to Leju ordinary shareholders—basic and diluted $ $ $ Weighted average number of ordinary shares outstanding—basic Stock options — Weighted average number of ordinary shares outstanding—diluted Basic earnings per share $ $ $ Diluted earnings per share $ $ $ Diluted earnings per share do not include the following instruments as their inclusion would have been anti-dilutive: Year Ended December 31, 2013 2014 2015 Share options and restricted shares — (v) Non-controlling interest Non-controlling interest are classified as a separate line item in the equity section and disclosures in the Company’s consolidated financial statements have distinguished the interest of Leju from the interest of non-controlling interest holders. (w) Comprehensive income Comprehensive income includes all changes in equity except those resulting from investments by owners and distributions to owners. For the years presented, total comprehensive income included net income and foreign currency translation adjustments. (x) Recently issued accounting pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued, ASU 2014-09, “Revenue from Contracts with Customers (Topic 606)”. The guidance replaces almost all exiting revenue recognition guidance, including industry specific guidance, in current US GAAP. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, an entity should apply the following steps: Step 1: Identify the contract(s) with a customer. Step 2: Identify the performance obligations in the contract. Step 3: Determine the transaction price. Step 4: Allocate the transaction price to the performance obligations in the contract. Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation. ASU 2014-09 is originally effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. ASU 2015-14, Revenue from Contracts with Customers, defers the effective date of ASU 2014-09 by one year. As a result, ASU 2014-09 is effective for annual reporting periods beginning after December 15, 2017 and interim periods therein. Early adoption is permitted to the original effective date. The Group is in the process of evaluating the impact of adoption of this guid |
Acquisition of Non-controlling
Acquisition of Non-controlling Interests | 12 Months Ended |
Dec. 31, 2015 | |
Acquisition of Non-controlling Interests | |
Acquisition of Non-controlling Interests | 3. Acquisition of Non-controlling Interests There were 3 significant acquisitions of non-controlling interests completed in 2014. As a result of the below transactions, the equity attributable to Leju’s shareholders is decreased by $32,469,069 in the year ended December 31, 2014. In January 2014, the Group entered into an equity transfer agreement with two individual shareholders of Beijing Lotta Times Advertising Co., Ltd (“Beijing Lotta”), a subsidiary of Beijing Leju, to purchase the remaining 40% shares of Beijing Lotta that it did not already own with a total consideration of $16,254,600 (RMB100,000,000). After the acquisition, Beijing Lotta became a wholly-owned subsidiary of the Group. As the Group retains the controlling interest in Beijing Lotta before and after the acquisition, the acquisition was accounted for as an equity transaction. The carrying amount of the non-controlling interest in the subsidiary was adjusted to reflect the change in Group’s ownership interest in Beijing Lotta. Any difference between the fair value of the consideration paid and the amount by which the non-controlling interest was adjusted was recognized in equity. As a result of the transaction, $15,112,828 additional paid capital and $1,141,772 non-controlling interest were derecognized in the year ended December 31, 2014. As of December 31, 2014 and 2015, $7,190,700 (RMB44,000,000) and $3,387,956 (RMB22,000,000)was unpaid, respectively. In September 2014, the Group entered into an equity transfer agreement with six individual shareholders (five of them are employees of the Group) of Beijing Yisheng Leju Advertising Co., Ltd (“Beijing Leju Advertisement”) and Yisheng Leju (Shanghai) Information Service Co., Ltd.( “Yisheng Shanghai”), two subsidiaries of Beijing Leju, to purchase the remaining 24.5% shares of Beijing Leju Advertisement and Yisheng Shanghai that it did not own with a total consideration of $19,074,412 (RMB117,355,000). Considerations to the five employees shareholders are $16,054,493 (RMB98,775,000) for 19.5% equity interest, equivalent to $823,307 per 1% equity interest, while the consideration for the rest 5.0% to the non-employee shareholder is $3,019,919 (RMB18,580,000), equivalent to $603,984 per 1% of equity interest. In connection with the equity transfer, the five employees are also required to serve for the Group for two years from the closing date of the transaction. The Group considers the purchase price to the nonemployee shareholder represent fair value of the equity interest on the date of transfer. The consideration premium of $4,276,810 paid to the employee shareholders was treated as share-based compensation to be amortized over the 2-year service period. After the acquisition, Beijing Leju Advertisement and Yisheng Shanghai became wholly-owned subsidiaries of the Group. As the Group retains the controlling interest in Beijing Leju Advertisement and Yisheng Shanghai before and after the acquisition, the acquisition was accounted for as an equity transaction. The carrying amount of the non-controlling interest in two subsidiaries were adjusted to reflect the change in Group’s ownership interest in them. Any difference between the fair value of the consideration paid and the amount by which the non-controlling interest was adjusted was recognized in equity. As a result of the equity transaction, $12,906,772 additional paid capital and $1,890,830 non-controlling interest were derecognized in the year ended December 31, 2014. As of December 31, 2014 and 2015, $15,534,635 and $3,706,648 was unpaid, respectively. In September 2014, the Group entered into an equity transfer agreement with an individual shareholder of Tianjin Yisheng Leju Advertising Co., Ltd (“Tianjin Leju”), a subsidiary of Beijing Leju, to purchase the remaining 30% shares of Tianjin Leju that it did not own with a total consideration of $4,685,913 (RMB28,830,000). After the acquisition, Tianjin Leju becomes a wholly-owned subsidiary of the Group. As the Group retains the controlling interest in Tianjin Leju before and after the acquisition, the acquisition was accounted for as an equity transaction. The carrying amount of the non-controlling interest in the subsidiary was adjusted to reflect the change in Group’s ownership interest in Tianjin Leju. Any difference between the fair value of the consideration paid and the amount by which the non-controlling interest was adjusted was recognized in equity. As a result of the transaction, $4,449,469 additional paid capital and $236,444 non-controlling interest were derecognized in the year ended December 31, 2014. As of December 31, 2014 and 2015, $2,871,268 and $243,989 was unpaid, respectively. |
Property and Equipment, Net
Property and Equipment, Net | 12 Months Ended |
Dec. 31, 2015 | |
Property and Equipment, Net | |
Property and Equipment, Net | 4. Property and Equipment, Net Property and equipment, net consists of the following: As of December 31, 2014 2015 $ $ Furniture, fixtures and equipment Leasehold improvements Buildings Motor vehicles Total Accumulated depreciation ) ) Property and equipment, net Depreciation expenses were $3,021,130, $3,030,451 and $2,626,264 for the years ended December 31, 2013, 2014 and 2015, respectively. |
Intangible Assets, Net
Intangible Assets, Net | 12 Months Ended |
Dec. 31, 2015 | |
Intangible Assets, Net | |
Intangible Assets, Net | 5. Intangible Assets, Net As of December 31, Weighted Average Remaining Amortization Period in Years 2014 2015 $ $ Intangible assets subject to amortization are comprised of the following: Advertising agency agreement with SINA License agreements with SINA Exclusive rights with Baidu — Customer relationship Database license Non-compete agreements — Computer software licenses Less: Accumulated amortization Advertising agency agreement License agreements with SINA Exclusive rights with Baidu Customer relationship Database license Non-compete agreements Computer software licenses Intangible assets subject to amortization, net Total intangible assets, net The advertising agency agreement and license agreements with SINA were recognized in connection with the Group’s acquisition of COHT in 2009, which allows the Group to operate SINA’s existing real estate and home furnishing related channels and have the exclusive right to sell advertising relating to real estate, home furnishing and construction materials on these channels as well as SINA’s other websites through 2019. If the Group sells advertising on SINA’s websites other than above channels, it will pay SINA fees of approximately 15% of the revenues generated from these sales. The acquisition cost was recognized as an intangible asset and amortized over the term of the agreement. In March 2014, the advertising agency agreement and license agreements originally signed between Leju and SINA in 2009 were extended an additional five years to March 2024 for no additional consideration. All other terms of the agreements remain the same. In 2011, the Group purchased exclusive rights from Baidu, Inc (“Baidu”) which allow it to sell Baidu’s real estate related Brand Link product, which is a form of keyword advertising, and to use and operate Baidu’s exclusive real estate-related web channel for $47,612,100 through August 2014. In October 2013, the Group extended these rights with Baidu to March 2015, without paying additional consideration. The payment schedule of the remaining liability for exclusive rights was also deferred through the extension period. The fair value of $43,847,992 was recognized in 2011 and calculated by discounting the future cash payments to be made from 2012 to 2014. The difference between the fair value and the principal amount of $3,764,108 is being amortized using the effective interest method over the term of the exclusive rights and amounted to $935,177, $52,922 and nil for the years ended December 31, 2013, 2014 and 2015, respectively. In April 2015, the Group extended these rights with Baidu from April to December 2015, with additional payment of $12,023,475 (RMB75,000,000). The Group paid $15,347,915, $9,004,710 and $12,023,475 in connection with the exclusive rights in 2013, 2014 and 2015, respectively. Amortization expenses were $35,321,801, $23,088,327 and $26,653,571 for the years ended December 31, 2013, 2014 and 2015, respectively. The Group expects to record amortization expenses of $12,416,185, $12,202,249, $11,304,846, $10,801,496 and $10,576,991 for the years ending December 31, 2016, 2017, 2018, 2019 and 2020, respectively. |
Goodwill
Goodwill | 12 Months Ended |
Dec. 31, 2015 | |
Goodwill | |
Goodwill | 6. Goodwill Changes in the carrying amount of goodwill for the years ended December 31, 2013, 2014 and 2015 are as follows: 2013 2014 2015 $ $ $ Balance as of January 1 Exchange rate translation ) ) Balance as of December 31 As of December 31, 2014 2015 $ $ Goodwill, gross Accumulated impairment charge ) ) Goodwill, net The Group utilized the income approach valuation method (Level 3) to compute the fair value of the Group. The key assumptions used in the income approach, which requires significant management judgment, include forecasted cash flows which consider the historical financial trends, business growth rate and market share, as well as terminal value and discount rate. Significant increases in discount rate or decrease in terminal value in isolation would result in a significantly lower fair value measurement. Based on the impairment tests performed, there was no goodwill impairment charged for the years ended December 31, 2013, 2014 and 2015, respectively. |
Dividends
Dividends | 12 Months Ended |
Dec. 31, 2015 | |
Dividends. | |
Dividends | 7. Dividends In March 2015, the Company’s board of directors approved the payment of a cash dividend of $0.20 per ordinary share ($0.20 per ADS) directly from the additional paid-in capital account, for a total of $26,873,022, which was paid in May 2015 to shareholders of record as of the close of business on April 10, 2015. |
Other Income (Loss), Net
Other Income (Loss), Net | 12 Months Ended |
Dec. 31, 2015 | |
Other Income (Loss), Net | |
Other Income (Loss), Net | 8. Other Income (Loss), Net Year Ended December 31, 2013 2014 2015 $ $ $ Amortized discounts related to liability for exclusive rights ) ) — Foreign exchange (loss) gain ) Others — — Total ) |
Income Tax
Income Tax | 12 Months Ended |
Dec. 31, 2015 | |
Income Tax | |
Income Tax | 9. Income Tax The following table summarizes Income (loss) before income taxes incurred in the PRC and outside of the PRC: Year Ended December 31, 2013 2014 2015 $ $ $ Income (loss) before income taxes: PRC Outside of PRC ) ) ) Total The expense (benefit) for income taxes is comprised of: Year Ended December 31, 2013 2014 2015 $ $ $ Current Tax PRC Outside of PRC — Deferred Tax PRC ) ) ) Outside of PRC — — — ) ) ) Income tax expense The Company is incorporated in the Cayman Islands, which is exempted from tax. Enterprise Income Tax Law in China applies a statutory 25% enterprise income tax rate to both foreign invested enterprises and domestic enterprises. Shanghai SINA Leju was granted status as a high and new technology enterprise and was entitled to enjoy a favorable statutory tax rate of 15% from 2013 through 2014. Shanghai SINA Leju renewed its qualification of high and new technology enterprise in 2015 and was entitled to enjoy a favorable statutory tax rate of 15% from 2015 through 2017. In February 2012, Shanghai Fangxin information technology Co., Ltd., the Group’s subsidiary in China, was granted software enterprise status, which exempted it from income taxes for 2012 and 2013 and provided a 50% reduction in its income tax rate, or a rate of 12.5%, from 2014 through 2016. The Group’s subsidiaries in Hong Kong are subject to a profit tax at the rate of 16.5% on assessable profit determined under relevant Hong Kong tax regulations. The Company’s subsidiaries incorporated in the BVI are not subject to taxation. The Group does not have uncertain tax positions in accordance with ASC740-10, nor does it anticipate any significant increase to its liability for unrecognized tax benefit within next 12 months. The Group will classify interest and penalties related to income tax matters, if any, in income tax expense. According to the PRC Tax Administration and Collection Law, the statute of limitations is three years if the underpayment of taxes is due to tax authority’s mistake or due to computational errors made by the taxpayer. The statute of limitations will be extended to five years under special circumstances, which are not clearly defined, but an underpayment of tax liability exceeding RMB100,000 ($15,400) is specifically listed as a special circumstance. In the case of a transfer pricing related adjustment, the statute of limitations is 10 years. There is no statute of limitations in the case of tax evasion. The principal components of the deferred income tax assets/liabilities are as follows: As of December 31, 2014 2015 $ $ Deferred tax assets: Accrued salary expenses Bad debt provision Net operating loss carry forwards Advertising expenses temporarily non-deductible Other Gross deferred tax assets Valuation allowance ) ) Total deferred tax assets Analysis as: Current Non-current Deferred tax liabilities: Amortization of intangible and other assets Total deferred tax liabilities Analysis as: Current — — Non-current Movement of the valuation allowance is as follows: Year Ended December 31, 2013 2014 2015 $ $ $ Balance as of January 1 ) ) ) Reverse (additions) ) — Write off — — Changes due to exchange rate translation ) Balance as of December 31 ) ) ) The Group has recognized a valuation allowance against deferred tax assets on tax loss carry forwards of $194,892, nil and reversed $255,264 for the years ended December 31, 2013, 2014 and 2015, respectively. The Group assesses the available positive and negative evidence to estimate if sufficient future taxable income will be generated to use the existing deferred tax assets. A significant piece of objective negative evidence evaluated was the cumulative loss incurred over the three year period ended December 31, 2015. Such objective evidence limits the Group’s ability to consider other subjective evidence such as our projections for future growth. In 2015, some entities start to gain profit and the valuation allowance was reversed accordingly. On the basis of this evaluation, as of December 31, 2015, a valuation allowance of $654,267 was recorded to reflect only the portion of the deferred tax assets that is not more likely than not to be realized. The amount of the deferred tax assets considered realizable, however, could be adjusted if estimates of future taxable income during the carry forwards period are reduced or increased or if objective negative evidence in the form of cumulative losses is no longer present and additional weight may be given to subjective evidence such as our projections for growth. In 2015, the Group has determined that the deferred tax assets of several subsidiaries will be more likely than not utilized in the future and has reversed valuation allowance for the determined tax assets. Reconciliation between the provision for income tax computed by applying the statutory tax rate to income before income taxes and the actual provision for income taxes is as follows: Year Ended December 31, 2013 2014 2015 PRC income tax rate % % % Share based compensation expenses not deductible for tax purposes % % % Other expenses not deductible for tax purposes % % % Effect of tax holiday )% )% )% Effect of different tax rate of subsidiary operation in other jurisdiction % % % Effect of different tax rate of DTA and DTL applied )% % )% Valuation allowance movement % — )% Withholding tax — % % Other % — — % % % The aggregate amount and per share effect of the tax holiday are as follows: Year Ended December 31, 2013 2014 2015 $ $ $ The aggregate dollar effect Per share effect—basic Per share effect—diluted As of December 31, 2014 and 2015, the Group had tax operating loss carry forwards of $14,298,098 and $15,151,067, respectively. These tax losses are available for offset against future profits that may be carried forward until calendar year 2019 and 2020, respectively. Undistributed earnings of the Company’s PRC subsidiaries of approximately $240,339,365 at December 31, 2015 are considered to be indefinitely reinvested and, accordingly, no provision for PRC dividend withholding tax has been provided thereon. Upon distribution of those earnings generated after January 1, 2008, in the form of dividends or otherwise, the Group would be subject to the then applicable PRC tax laws and regulations. The amounts of unrecognized deferred tax liabilities for these earnings are in the range of $12,016,968 to $24,033,937, as the withholding tax rate of the profit distribution will be 5% or 10% depending on whether the immediate offshore companies are able to maintain the preferential withholding tax rate of 5%. Income tax payable balance of the Group represents the actual cash tax payments to be made by the legal entities within the Group. Income tax provision reflected in the Company’s consolidated statements of operations is calculated based on a separate return basis as if the Group had filed a separate tax return, which has considered the impact of general corporate expenses allocated from E-House. The difference between the income tax provision on a separate return basis and the tax liability accrued was reflected as deemed distribution to E-House associated with tax liability in the consolidated statements of changes in equity before the IPO. Such difference amounted to $2,381,799 and $571,227 for the years ended December 31, 2013 and for the period from January 1, 2014 to the IPO date, respectively. |
Share-Based Compensation
Share-Based Compensation | 12 Months Ended |
Dec. 31, 2015 | |
Share-Based Compensation | |
Share-Based Compensation | 10. Share-Based Compensation Leju Plan In November 2013, the Group adopted a share incentive plan (“Leju Plan”), which allows the Group to offer a variety of share-based incentive awards to employees, officers, directors and individual consultants who render services to the Group. Under the Leju Plan, the maximum number of shares that may be issued shall be 8% of the total outstanding shares on an as-converted and fully diluted basis as of the effective date of the plan. Options have a ten-year life. Share Options: On December 1, 2013, the Company granted 7,192,000 options to purchase its ordinary shares to certain of the Group’s employees and E-House’s employees at an exercise price of $4.60 per share. The options expire ten years from the date of grant and vest ratably at each grant date anniversary over a period of three years. On December 16, 2013, the Company granted 600,000 restricted shares to a director and an E-House employee to replace the same number of options previously granted under the Leju plan, with all other terms unchanged. The purchase price of the restricted shares is $4.60 per share, which were the exercise prices of the options that were replaced. The modification did not result in any incremental compensation expense. Cash received from the advance payment of the restricted shares are recorded as an amount due to related parties. In January, 2014, the Company granted 60,000 restricted shares to an E-House employee to replace the same number of options previously granted under the Leju plan, with all other terms unchanged. The purchase price of the restricted shares is $4.60 per share, which were the exercise prices of the options that were replaced. The modification did not result in any incremental compensation expense. Cash received from the advance payment of the restricted shares are recorded as an amount due to related parties. During 2015, the Company granted 2,517,000 options to purchase its ordinary shares to certain of the Group’s employees at an exercise prices from $5.54 to $9.68 per share, respectively. The options expire ten years from the date of grant and vest ratably at each grant date anniversary over a period of three years. The Company has used the binomial model to estimate the fair value of the options granted under the Leju Plan. The fair value per option was estimated at the date of grant using the following assumptions: 2013 2015 Risk-free rate of return Contractual life of option 10 years 10 years Estimated volatility rate Dividend yield A summary of option activity under the Leju Plan during the year ended December 31, 2015 is presented below: Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term Weighted Average Aggregate Intrinsic Value of Options $ Outstanding, as of January 1, 2015 Granted Exercised ) Forfeited ) Outstanding, as of December 31, 2015 Vested and expected to vest as of December 31, 2015 Exercisable as of December 31, 2015 The weighted average grant-date fair value of the options granted in December 2013 was $2.21 and $3.44 per share of the options granted in 2015. For the year ended December 31, 2013, 2014 and 2015, the Company recorded compensation expenses of $289,649, $3,464,140 and $4,025,809 for the share options granted to the Group’s employees and recorded deemed distribution to E-House of $92,225, $1,061,412 and $1,070,383 for the share options granted to E-House’s employees, respectively. During the years ended December 31, 2014 and 2015, 266,201 and 196,185 options were exercised having a total intrinsic value of $1,668,693 and $949,907, respectively. As of December 31, 2015, there was $11,525,658 of total unrecognized compensation expense related to unvested share options granted under the Leju Plan. That cost is expected to be recognized over a weighted-average period of 2.13 years. Restricted Shares: On March 18, 2014, the Company granted 866,000 restricted shares to certain employees, directors and officers, under the terms of each restricted shares, restricted shares vest over three years. On August 21, 2014, the Company granted 229,400 restricted shares to certain employees and officers, under the terms of each restricted shares, restricted shares vest over eight months. A summary of restricted share activity under the Leju Plan during the year ended December 31, 2015 is presented below: Number of Restricted Shares Weighted Average Grant-date Fair Value $ Outstanding, as of January 1, 2015 Granted — Vested ) Forfeited ) Outstanding, as of December 31, 2015 The total fair value of restricted shares vested in 2013, 2014 and 2015 was nil, $486,200 and $7,179,455, respectively. For the years ended December 31, 2013, 2014 and 2015, the Company recorded compensation expenses of $20,855, $4,881,656 and $ 5,273,322 for the restricted shares granted to the Group’s employees and recorded deemed distribution to E-House of $13,903, $41,570 and $41,580 for the share options granted to E-House’s employees, respectively. As of December 31, 2015, there was $4,384,344 of total unrecognized compensation expense related to unvested restricted shares granted under the Leju Plan. That cost is expected to be recognized over a weighted-average period of 1.19 years. Omnigold Plan: In 2015, the Group’s subsidiary, Omnigold Holdings Limited (“Omnigold”), adopted a share incentive plan (“Omnigold Plan”), which proposed that (i) the maximum number of shares of Omnigold available for issuance pursuant to all awards under the Ominigold Plan shall initially be 5,000,000 as of the date of the Ominigold Plan was approved and adopted by the Board of Omnigold (the “Effective Dare”), and (ii) the Ominigold Plan shall be increased automatically by 5% of the then total issued and outstanding shares of Omnigold on an as-converted fully diluted basis on each of the third, sixth and ninth anniversary of the Effective Date. On August 11, 2015, Omnigold granted 2,400,000 options to purchase its ordinary shares to certain of the Group’s employees at an exercise price of $1.50 per share. The options expire ten years from the date of grant and vest ratably at each grant date anniversary over a period of three years. The Company has used the binomial model to estimate the fair value of the options granted under the Omnigold Plan. The fair value per option was estimated at the date of grant using the following assumptions: 2015 Risk-free rate of return Contractual life of option 10 years Estimated volatility rate Dividend yield A summary of option activity under the Omnigold Plan during the year ended December 31, 2015 is presented below: Number of Options Exercise Price Remaining Contractual Term Aggregate Intrinsic Value of Options $ Outstanding, as of January 1, 2015 — Granted — Exercised — Forfeited ) — Outstanding, as of December 31, 2015 — Vested and expected to vest as of December 31, 2015 — Exercisable as of December 31, 2015 — The grant-date fair value of the options granted in August, 2015 was $0.30 per share. For the year ended December 31, 2015, the Company recorded compensation expenses of $80,577. As of December 31, 2015, there was $545,884 of total unrecognized compensation expense related to unvested share options granted under the Omnigold Plan. That cost is expected to be recognized over a weighted-average period of 2.61 years. E-House’s Share Incentive Plan (the “E-House Plan”) In 2006, E-House Holdings adopted the E-House Plan, which allows E-House Holdings to offer a variety of share-based incentive awards to employees, officers, directors and individual consultants who render services to E-house. Under the E-House Plan, E-House Holdings authorized 3,636,364 ordinary shares, or 5% of the then total shares outstanding, to grant as options or restricted shares over a three-year period. In October 2010, E-House Holdings authorized an increase of 4,013,619 ordinary shares to the award pool. In November 2012, E-House Holdings further authorized an increase of 1,273,000 ordinary shares to the award pool. In August, 2013, E-House Holdings authorized an increase of 6,644,659 ordinary shares to the award pool. Options have a ten-year life. Share options granted under the E-House Plan can be settled by the employee either by cash or net settled by shares. Share Options: A summary of option activity under the E-House Plan during the year ended December 31, 2015 is presented below: Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term Weighted Average Aggregate Intrinsic Value of Options Outstanding, as of January 1, 2015 Exercised ) Forfeited ) Outstanding, as of December 31, 2015 Vested and expected to vest as of December 31, 2015 Exercisable as of December 31, 2015 E-House Holdings recorded compensation expense of $12,817,935, $5,950,940 and nil for the years ended December 31, 2013, 2014 and 2015, respectively. During the years ended December 31, 2013, 2014 and 2015, 4,596,761, 3,446,585 and 513,261 options were exercised having a total intrinsic value of $25,248,554, $23,679,729 and $1,745,007, respectively. As of December 31, 2015, there is no unrecognized compensation expense related to unvested share options granted under the E-House Plan. Restricted Shares: E-House Holdings granted 1,303,000, 1,439,000 and nil restricted shares to certain employees, directors and officers in 2013, 2014 and 2015 respectively. Under the terms of each restricted shares, restricted shares vest over three years. A summary of restricted share activity under the E-House Plan during the year ended December 31, 2015 is presented below: Weighted Number of Average Restricted Grant-date Shares Fair Value $ Unvested as of January 1, 2015 Granted — Vested ) Forfeited ) Unvested as of December 31, 2015 The total fair value of restricted shares vested in 2013, 2014 and 2015 was $5,612,379, $6,094,602 and $9,909,868, respectively. As of December 31, 2015, there was $11,558,404 of total unrecognized compensation expense related to restricted shares granted under the E-House Plan. That cost is expected to be recognized over a weighted-average period of 1.53 years. E-House Holdings recorded compensation expense of $5,668,460, $6,174,583 and $9,680,385, for the years ended December 31, 2013 and 2014 and 2015, respectively, related to restricted shares. Share-based compensation expenses under E-House Plan allocated to the Group The share-based compensation expense under E-House Plan allocated to the Group was $6,000,438 and $572,340 for the years ended December 31, 2013 and the period from January 1, 2014 to the IPO date, respectively. These expenses are part of the selling, general and administrative expenses allocated from E-House, which were waived and have been reflected as capital contributions as of the date such expenses were originally allocated. Subsequent to the IPO, E-House began charging the Group transitional corporate service fees, $1,857,996 and $1,066,477 share-based compensation expense under E-House Plan and CRIC Plan were charged to Leju from the IPO date to December 31, 2014 and for the year ended December 31, 2015. (See Note 13) Other Equity Compensation In September 2014, the Group acquired non-controlling interests from certain employee shareholders. The price premium paid over the fair value of the ordinary shares amounting $4,276,810 was recorded as share-based compensation costs and to be amortized over the required two-year service period (See Note 3). $534,601 and $2,138,404 stock compensation expense was recognized for the year ended December 31, 2014 and 2015. As of December 31, 2014 and 2015, there was $3,742,209 and $1,603,805 of total unrecognized compensation expense related to this compensation agreement. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2015 | |
Employee Benefit Plans | |
Employee Benefit Plans | 11. Employee Benefit Plans The Group’s PRC subsidiaries and VIEs are required by law to contribute a certain percentages of applicable salaries for retirement benefits, medical insurance benefits, housing funds, unemployment and other statutory benefits. The PRC government is directly responsible for the payments of such benefits. The Group contributed $14,174,182, $17,727,125, and $20,413,820 for the years ended December 31, 2013, 2014 and 2015, respectively, for such benefits. |
Distribution of Profits
Distribution of Profits | 12 Months Ended |
Dec. 31, 2015 | |
Distribution of Profits | |
Distribution of Profits | 12. Distribution of Profits Relevant PRC statutory laws and regulations permit payment of dividends by the Group’s PRC subsidiaries and VIEs only out of their retained earnings, if any, as determined in accordance with PRC accounting standards and regulations. Under PRC law, each of the Group’s PRC subsidiaries and VIEs is required to set aside at least 10% of its after-tax profits each year, if any, to fund a statutory reserve until such reserve reaches 50% of its registered capital. Each of the Group’s subsidiaries with foreign investment is also required to further set aside a portion of its after-tax profits to fund the employee welfare fund at the discretion of the board. Although the statutory reserves can be used, among other ways, to increase the registered capital and eliminate future losses in excess of retained earnings of the respective companies, the reserve funds are not distributable as cash dividends, loans or advances except in the event of liquidation of these subsidiaries. The amount of the reserve fund for the Group as of December 31, 2014 and 2015 was $7,251,948 and $7,990,298 respectively. As a result of these PRC laws and regulations, the Group’s PRC subsidiaries and VIEs are restricted in their ability to transfer a portion of their net assets, including general reserve and registered capital, either in the form of dividends, loans or advances. Such restricted portion amounted to $33,040,488 and $33,778,838, of which $8,349,188 and $8,342,759 was attributed to general reserve and registered capital of the VIEs, as of December 31, 2014 and 2015, respectively. |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2015 | |
Segment Information | |
Segment Information | 13. Segment Information The Group operates and manages its business as a single segment. The Group uses the management approach to determine operating segments. The management approach considers the internal organization and reporting used by the Group’s chief operating decision maker (“CODM”) for making decisions, allocating resources and assessing performance. The Group’s CODM has been identified as the chief executive officer, who reviews the consolidated results of the Group as a whole when making decisions about allocating resources and assessing performance. The following table summarizes the revenue information of the Group: Year Ended December 31, 2013 2014 2015 $ $ $ E-commerce Online advertising Listing Geographic Substantially all of the Group’s revenues from external customers and long-lived assets are located in the PRC. Major customers There were no customers from whom revenue accounted for 10% or more of total revenue for the years ended December 31, 2013, 2014 and 2015, respectively. Details of the accounts receivable from customers accounting for 10% or more of total net accounts receivable are as follows: As of December 31, 2014 2015 $ $ Customer A |
Related Party Balances and Tran
Related Party Balances and Transactions | 12 Months Ended |
Dec. 31, 2015 | |
Related Party Balances and Transactions | |
Related Party Balances and Transactions | 14. Related Party Balances and Transactions The table below sets forth major related parties and their relationships with the Group: Company Name Relationship with the Group E-House Under the common control of E-House Holdings SINA Mr. Charles Chao, co-chairman of E-House, is SINA’s chairman and chief executive officer Beijing China Real Estate Research Association Technology Ltd. (“CRERAT”) Mr. Xin Zhou, co-chairman and chief executive officer of E-House, is the legal representative of CRERAT, and E-House owns 51% of CRERAT These consolidated financial statements include transactions with E-House and its subsidiaries. Furthermore, E-House provided certain corporate services for the consolidated financial statement periods presented (see Note 1). During the years ended December 31, 2013, 2014 and 2015, E-House loaned $1,000, nil and nil respectively, to fund capital injections into the Group’s PRC subsidiaries. Such amounts have been waived by E-House and have been reflected as capital contributions as of the date such loans were originally made. During the years ended December 31, 2013, 2014 and 2015, significant related party transactions were as follows: Year Ended December 31, 2013 2014 2015 $ $ $ Corporate expenses allocated from E-House — Corporate service provided by E-House under transitional service agreement — Online advertising agency fee recognized as cost of revenues purchased from SINA Services purchased from/rental paid to E-House Online advertising services provided to CRERAT — — Online advertising services provided to E-House Online advertising services provided to SINA — — Dividend declared and paid to E-House — — The transactions are measured at the amount of consideration established and agreed to by the related parties, which approximate amounts charged to third parties. As at December 31, 2014 and 2015, amounts due from related parties were $684 and $8,906 respectively, which were the cash paid to supplier on behalf of CRERAT for the purchase of marketing services. As at December 31, 2014 and 2015, amounts due to related parties were comprised of the following: As of December 31, 2014 2015 $ $ SINA (1) E-House (2) Management (3) E-House Management (3) Total (1) The amount due to SINA as of December 31, 2014 and 2015 represents online advertising agency fees payable to SINA. (2) The amount due to E-House as of December 31, 2015 was primarily for corporate service fees charged to Leju, and partially offset by the amount due to online services provided to E-House and revenues collected by E-House on behalf. The balance is interest free and settable on demand. (3) The amount due to management/ E-House management represents consideration paid by management/ E-House management for unvested restricted shares (see Note 10). The rollforward of the payable (receivable) balance with E-House for the years ended December 31, 2013, 2014 and 2015 is as follows: Year Ended December 31, 2013 2014 2015 $ $ $ Balance at January 1 ) Refund loan to E-House for working capital A ) — ) Loans from E-House for capital contribution B — — Dividend declared to E-House C — — Dividend paid to E-House D — — ) Corporate expenses allocated from E-House (Note 1) B — Corporate service provided by E-House under transitional service agreement (Note 1) E — Revenues collected by E-House on behalf of the Company F ) ) — Related party balance waived as capital contribution B ) ) — Service provided to E-House E ) ) ) Service purchased from E-House E Net (payment) receipt for services G ) Balance at December 31 ) (A) Represents the movement of the loan payable to E-House (B) Represents the movement of the loans from E-House for capital contributions and headquarter expenses allocated by E-House prior to Leju’s initial public offering, which were subsequently 100% waived by E-House and recorded as capital contributions by Leju. Accordingly, the net balance at each year end is zero. (C) Represent the cash dividend declared by Leju to its shareholder E-house. In March 2015, the Company’s board of directors approved the payment of a cash dividend of $0.20 per ordinary share ($0.20 per ADS) directly from the additional paid-in capital account. (D) Represent the cash dividend paid to E-House. (E) Represents the movement of service fees receivable from and payable to E-House (F) Represents Leju revenues collected by E-House on behalf of the Company (G) Represents the cash flow between the Company and E-House except to the loan from (refund to ) E-House As of December 31, 2014 2015 $ $ Loan payable to E-House (A) — Service payable to E-House (E) Receivables for E-House collection on behalf of the Company (F) ) ) Amounts due to E-House |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2015 | |
Commitments and Contingencies | |
Commitments and Contingencies | 15. Commitments and Contingencies (a) Operating lease commitments The Group has operating lease agreements principally for its office properties in the PRC. Such leases have remaining terms ranging from one to 120 months and are renewable upon negotiation. Rental expenses were $7,669,866, $8,601,039 and $10,078,033, for the years ended December 31, 2013, 2014 and 2015, respectively. Future minimum lease payments under non-cancelable operating lease agreements at December 31, 2015 were as follows: Year Ended December 31 Amount $ 2016 2017 2018 2019 2020 Then thereafter Total (b) Contingencies The Group is subject to claims and legal proceedings that arise in the ordinary course of its business. Each of these matters is subject to various uncertainties, and it is possible that some of these matters may be decided unfavorably to the Group. The Group does not believe that any of these matters will have a material effect on its business, assets or operations. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2015 | |
Subsequent Events. | |
Subsequent Events | 16. Subsequent Events No significant subsequent events have occured as of April 22, 2016. |
Summary of Principal Accounti25
Summary of Principal Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Summary of Principal Accounting Policies | |
Basis of presentation | (a) Basis of presentation The consolidated financial statements are prepared and presented in accordance with accounting principles generally accepted in the United States of America (“US GAAP”). |
Basis of consolidation | (b) Basis of consolidation The consolidated financial statements include the financial statements of Leju, its majority owned subsidiaries and its VIEs, Beijing Leju, Shanghai Yi Xin and Beijing Jiajujiu. All inter-company transactions and balances have been eliminated in consolidation. The Group evaluates each of its interests in private companies to determine whether or not the investee is a VIE and, if so, whether the Group is the primary beneficiary of such VIE. In determining whether the Group is the primary beneficiary, the Group considers if the Group (1) has power to direct the activities that most significantly affects the economic performance of the VIE, and (2) receives the economic benefits of the VIE that could be significant to the VIE. If deemed the primary beneficiary, the Group consolidates the VIE. The VIE arrangements PRC regulations currently prohibit or restrict foreign ownership of companies that provide internet content and advertising services. To comply with these regulations, the Group provides such activities relating to real estate projects through its VIEs and their subsidiaries. To provide the Group effective control over and the ability to receive substantially all of the economic benefits of its VIEs and their subsidiaries, certain of the Company’s subsidiaries, Shanghai SINA Leju, Shanghai Yi Yue and Maiteng (collectively, the “Foreign Owned Subsidiaries”) entered into a series of contractual arrangements with Beijing Leju, Shanghai Yi Xin and Beijing Jiajujiu (collectively the “VIEs”) and their respective shareholders, respectively, as summarized below: Name of Foreign Owned Subsidiaries Foreign Owned Subsidiaries’ Economic Ownership of VIES Name of VIEs Activities of VIEs Shanghai SINA Leju % Beijing Leju Operate the online advertising and listing business Shanghai Yi Yue % Shanghai Yi Xin Operate the e-commerce business Beijing Maiteng % Beijing Jiajujiu Operate the online home furnishing business The VIEs hold the requisite licenses and permits necessary to conduct internet content and advertising services activities relating to real estate projects from which foreign ownership of companies are prohibited or restricted. In addition, the VIEs hold leases and other assets necessary to operate such business and generate a majority of the Group’s revenues. Agreements that Transfer Economic Benefits of the VIEs to the Group Exclusive Consulting and Technical Support Agreement. Pursuant to an exclusive consulting and technical support agreement between the Foreign Owned Subsidiaries and the respective VIEs, the Foreign Owned Subsidiaries provide the respective VIEs with a series of consulting and technical support services and are entitled to receive related fees. The term of this exclusive technical support agreement will expire upon dissolution of the VIEs. Unless expressly provided by this agreement, without prior written consent of the Foreign Owned Subsidiaries, the VIEs may not engage any third party to provide the services offered by the Foreign Owned Subsidiaries under this agreement. Agreements that Provide Effective Control over VIEs Exclusive Call Option Agreement. Each of shareholders of the VIEs has entered into an exclusive call option agreement with the respective Foreign Owned Subsidiaries. Pursuant to these agreements, each of the shareholders of the VIEs has granted an irrevocable and unconditional option to the respective Foreign Owned Subsidiaries or their designees to acquire all or part of such shareholder’s equity interests in VIEs at its sole discretion, to the extent as permitted by PRC laws and regulations then in effect. The consideration for such acquisition of all equity interests in the VIEs will be equal to the registered capital of the VIEs, and if PRC law requires the consideration to be greater than the registered capital, the consideration will be the minimum amount as permitted by PRC law. In addition, the VIEs irrevocably and unconditionally granted the respective Foreign Owned Subsidiaries an exclusive option to purchase, to the extent permitted under the PRC law, all or part of the assets of the VIEs. The exercise price for purchasing the assets of the VIEs will be equal to their respective book values, and if PRC law requires the price to be greater than the book value, the price will be the minimum amount as permitted by PRC law. The call option may be exercised by the respective Foreign Owned Subsidiaries or their designees. Loan Agreement. Under the loan agreement among shareholders of the VIEs and the respective Foreign Owned Subsidiaries, the respective Foreign Owned Subsidiaries granted an interest-free loan to the shareholders of the VIEs, solely for their purchase of the equity interest of the VIEs, investing or operating activities conducted in the VIEs. Each loan agreement has a term of twenty years. Shareholder Voting Right Proxy Agreement. Each of the shareholders of the VIEs irrevocably grant any person designated by the respective Foreign Owned Subsidiaries the power to exercise all voting rights to which he will be entitled to as shareholder of the VIEs at that time, including the right to declare dividends, appoint and elect board members and senior management members and other voting rights. Each shareholder voting right proxy agreement has a term of twenty years, unless it is early terminated by all parties in writing or pursuant to provision of this agreement. The term of the agreement will be automatically extended for one year upon the expiration, if the Foreign Owned Subsidiary gives the other parties written notice requiring the extension thereof and the same mechanism will apply subsequently upon the expiration of each extended term. Equity Pledge Agreement. Each of the shareholders of the VIEs has also entered into an equity pledge agreement with the respective Foreign Owned Subsidiaries. Pursuant to which these shareholders pledged their respective equity interest in the VIEs to guarantee the performance of the obligations of the VIEs. The Foreign Owned Subsidiaries, as pledgee, will be entitled to certain rights, including the right to sell the pledged equity interests. Pursuant to the equity pledge agreement, each shareholder of the VIEs cannot transfer, sell, pledge, dispose of or otherwise create any new encumbrance on their respective equity interest in the VIEs without the prior written consent of the respective Foreign Owned Subsidiaries. The equity pledge right enjoyed by the Foreign Owned Subsidiaries will expire when shareholders of the VIEs have fully performed their respective obligations under the above agreements. The equity pledges of the VIEs have been registered with the relevant local branch of the State Administration for Industry and Commerce, or SAIC. Risks in relation to the VIE structure The Company believes that the Foreign Owned Subsidiaries’ contractual arrangements with the VIEs are in compliance with PRC law and are legally enforceable. However, uncertainties in the PRC legal system could limit the Company’s ability to enforce these contractual arrangements and the interests of the shareholders of the VIEs may diverge from that of the Company and that may potentially increase the risk that they would seek to act contrary to the contractual terms, for example by influencing the VIEs not to pay the service fees when required to do so. The Company’s ability to control the VIEs also depends on the power of attorney the Foreign Owned Subsidiaries have to vote on all matters requiring shareholder approval in the VIEs. As noted above, the Company believes this power of attorney is legally enforceable but may not be as effective as direct equity ownership. In addition, if the legal structure and contractual arrangements were found to be in violation of any existing PRC laws and regulations, the Company may be subject to fines or other actions. The Company does not believe such actions would result in the liquidation or dissolution of the Company, the Foreign Owned Subsidiaries or the VIEs. The Company, through its subsidiaries and through the contractual arrangements, has (1) the power to direct the activities of the VIEs that most significantly affect the entity’s economic performance and (2) the right to receive benefits from the VIEs. Accordingly, the Company is the primary beneficiary of the VIEs and has consolidated the financial results of the VIEs. The following financial statement amounts and balances of the Group’s VIEs were included in the accompanying consolidated financial statements: As of December 31, 2014 2015 $ $ Cash and cash equivalents Accounts receivable, net of allowance for doubtful accounts Customer deposits — Amounts due from related parties Other current assets Total current assets Total non-current assets Total assets Accounts payable Accrued payroll and welfare expenses Income tax payable Other tax payable Amounts due to related parties Advance from customers Liability for accrued marketing and advertising expenses Liability for unpaid consideration of acquiring non-controlling interest Other current liabilities Total current liabilities Deferred tax liabilities, non-current Total liabilities Year Ended December 31, 2013 2014 2015 $ $ $ Total revenues Cost of revenues ) ) ) Net income Net cash provided by operating activities Net cash used in investing activities ) ) ) Net cash used in financing activities ) ) ) There are no consolidated VIEs’ assets that are collateral for the VIEs’ obligations or are restricted solely to settle the VIEs’ obligations. The Company has not provided any financial support that it was not previously contractually required to provide to the VIEs. |
Use of estimates | (c) Use of estimates The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from such estimates. Significant accounting estimates reflected in the Group’s financial statements include useful lives and valuation of long-lived assets, evaluation of goodwill, allowance for doubtful accounts, assumptions related to share-based compensation arrangements, assumptions related to the consolidation of entities in which the Group holds variable interests, valuation allowance on deferred tax, and selling price hierarchy in multiple-deliverable revenue arrangements. |
Fair value of financial instruments | (d) Fair value of financial instruments The Group may have certain of its financial assets and liabilities at fair value on a recurring basis. Fair value reflects the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Company considers the principal or most advantageous market in which it would transact and considers assumptions that market participants would use when pricing the asset or liability. The Group applies a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. There are three levels of inputs that may be used to measure fair value: Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities. 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 asset or liability 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 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. There are no assets or liabilities measured at fair value on a recurring basis subsequent to initial recognition. There were no assets or liabilities measured at fair value on a nonrecurring basis in 2013, 2014 and 2015. For cash and cash equivalents, accounts receivable, customer deposits, other receivables, accounts payable, other payables, and amounts due from/to related parties, the carrying value approximates the fair value due to their short-term nature. |
Business combinations | (e) Business combinations Business combinations are recorded using the purchase method of accounting and, accordingly, the acquired assets and liabilities are recorded at their fair market value at the date of acquisition. Any excess of acquisition cost over the fair value of the acquired assets and liabilities, including identifiable intangible assets, is recorded as goodwill. |
Cash and cash equivalents | (f) Cash and cash equivalents Cash and cash equivalents consist of cash on hand and demand deposits, which are unrestricted as to withdrawal and use, and which have original maturities of three months or less. |
Customer deposits | (g) Customer deposits The Group provides online e-commerce services for customers. Some real estate developers require the Group to pay an upfront and refundable deposit to obtain the exclusive e-commerce services agreement of the real estate development projects. These deposits are refunded to the Group subject to certain pre-determined criteria specified in the contracts. Customer deposits are recorded as either current or non-current assets based on the Group’s estimate of the date of refund. As of December 31, 2015, all customer deposit are refundable within 12 months and none of them passed the original due date. |
Investment in affiliates | (h) Investment in affiliates Affiliated companies are entities over which the Group has significant influence, but which it does not control. The Group generally considers an ownership interest of 20% in common stock or higher to represent a presumption that they are able to exert significant influence. Investments in affiliates are accounted for by the equity method of accounting. Under this method, the Group’s share of the post-acquisition profits or losses of affiliated companies is recognized in the income statement and its share of post-acquisition movements in other comprehensive income is recognized in other comprehensive income. Unrealized gains on transactions between the Group and its affiliated companies are eliminated to the extent of the Group’s interest in the affiliated companies; unrealized losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. When the Group’s share of losses in an affiliated company equals or exceeds its interest in the affiliated company, the Group does not recognize further losses, unless the Group has incurred obligations or made payments on behalf of the affiliated company. The Group is required to perform an impairment assessment of its investments whenever events or changes in business circumstances indicate that the carrying value of the investment may not be fully recoverable. An impairment loss is recorded when there has been a loss in value of the investment that is other than temporary. The Group has not recorded any impairment losses in any of the periods reported. As of December 31, 2014 and 2015, the Group determined that no such events were present. |
Property and equipment, net | (i) Property and equipment, net Property and equipment is recorded at cost less accumulated depreciation. Depreciation is computed on a straight-line basis over the following estimated useful lives: Leasehold improvements Over the shorter of the lease term or their estimated useful lives Buildings 30 years Furniture, fixtures and equipment 3-5 years Motor vehicles 5 years Gains and losses from the disposal of property and equipment are included in income from operations. |
Intangible assets, net | (j) Intangible assets, net Acquired intangible assets mainly consist of advertising agency agreement and license agreements with SINA, exclusive rights with Baidu, Inc. (“Baidu”), customer relationships, Database license, and non-compete agreements from business combinations and are recorded at fair value on the acquisition date. All intangible assets, with the exception of customer relationships, are amortized ratably over the contract period. Intangible assets resulting out of acquired customer relationships are amortized based on the timing of the revenue expected to be derived from the respective customer. |
Impairment of long-lived assets | (k) Impairment of long-lived assets The Group evaluates its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. When these events occur, the Group measures impairment by comparing the carrying amount of the assets to future undiscounted net cash flows expected to result from the use of the assets and their eventual disposition. If the sum of the expected undiscounted cash flow is less than the carrying amount of the assets, the Group would recognize an impairment loss equal to the excess of the carrying amount over the fair value of the assets. |
Impairment of goodwill and indefinite lived intangible assets | (l) Impairment of goodwill and indefinite lived intangible assets The Group performs an annual goodwill impairment test comprised of two steps. The first step compares the fair value of the Group to its carrying amount, including goodwill and indefinite lived intangible assets. If the fair value of the Group exceeds its carrying amount, goodwill is not considered to be impaired and the second step will not be required. If the carrying amount of the Group exceeds its fair value, the second step compares the implied fair value of goodwill and indefinite lived intangible assets to the carrying value of the Group’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 determined in the first step to the assets and liabilities of the Group. The excess of the fair value of the Group over the amounts assigned to the assets and liabilities is the implied fair value of goodwill. This allocation process is only performed for 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 of goodwill over the implied fair value of goodwill. Management performs a goodwill impairment test at the Group level as of December 31 of each year or when there is a triggering event causing management to believe it is more likely than not that the carrying amount of goodwill may be impaired. Intangible assets with an indefinite life are tested for impairment annually or more frequently if events or changes in circumstances indicate that the asset might be impaired. The impairment test consists of a comparison of the fair value of the intangible asset to its carrying amount. If the carrying amount exceeds the fair value, an impairment loss is recognized equal in amount to that excess. |
Income taxes | (m) Income taxes Deferred income taxes are recognized for temporary differences between the tax basis of assets and liabilities, and their reported amounts in the financial statements, net operating loss carry forwards and credits by applying enacted statutory tax rates applicable to future years when the reported amounts of the asset or liability are expected to be recovered or settled, respectively. Deferred tax assets are reduced by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Current income taxes are provided for in accordance with the laws of the relevant taxing authorities. The components of the deferred tax assets and liabilities are individually classified as current and non-current based on the classification of the related assets and liabilities for financial reporting purposes. The Group only recognizes tax benefits related to uncertain tax positions when such positions are more likely than not of being sustained upon examination. For such positions, the amount of tax benefit that the Group recognizes is the largest amount of tax benefit that is more than fifty percent likely of being sustained upon the ultimate settlement of such uncertain position. The Group records interest and penalties as a component of income tax expense. |
Share-based compensation | (n) Share-based compensation Share-based compensation cost is measured on the grant date, based on the fair value of the award, and recognized as an expense over the requisite service period. Management has made an estimate of expected forfeitures and recognizes compensation cost only for those equity awards expected to vest. |
Revenue recognition | (o) Revenue recognition The Group recognizes revenue when there is persuasive evidence of an arrangement, service has been rendered, the sales price is fixed or determinable and collectability is reasonably assured. Revenues are recorded, net of sales related taxes. The Group generates real estate online revenues principally from e-commerce, online advertising, and listing services. The Group e-commerce services primarily include discount coupon advertising and online property auctions. The Group also provides property viewing and pre-sale customer support free of charge in connection with the sale of discount coupons and online property auctions. E-commerce revenues are principally generated from selling discount coupons to potential property buyers. Those discount coupons allow buyers to purchase specified properties from real estate developers at discounts greater than the face value of the fees charged by the Group. The discount coupons are refundable to the buyers at any time before they are used to purchase the specified properties. The Group recognizes such e-commerce revenues upon obtaining confirmation letters that prove the use of coupons by property buyers, and when collections are reasonably assured. Revenues are recognized based on the net proceeds received as the Group acts as a marketing agent of the property developer in the transaction. Revenue from online advertising services is generated principally from online advertising arrangements, sponsorship arrangements, and to a lesser extent, outsourcing arrangements, and keyword advertising arrangements. Online advertising arrangements allow advertisers to place advertisements on particular areas of the Group’s websites, in particular formats and over particular periods of time. Advertising revenues from online advertising arrangements are recognized ratably over the contract period of display when collectability is reasonably assured. Sponsorship arrangements allow advertisers to sponsor a particular area on the Group’s websites in exchange for a fixed payment over the contract period. Advertising revenues from sponsorship arrangements are recognized ratably over the contract period. The Group also generates online advertising revenues from outsourcing certain regional sites for a fixed period of time to local outsourcing partners, who are responsible for both website operation and related advertising sales. Advertising revenues from hosted websites are recognized ratably over the term of the contract. Keyword advertising revenues are recognized ratably over the contract period when collectability is reasonably assured. The Group also provides listing services to real estate brokers. Listing services entitle real estate brokers to post and make changes to information for properties in a particular area on the website for a specified period of time, in exchange for a fixed fee. Listing revenues are recognized ratably over the contract period of display when collectability is reasonably assured. There are no multiple elements arrangements within the services provided by the Group. However, E-House has multiple element arrangements that may include provision of online advertising services provided by the Group. The total amounts of revenue earned by the Group related to agreements that have been accounted for as multiple element arrangements by E-House were $5,556,867, $4,836,931 and $3,689,272 in 2013, 2014 and 2015, respectively. Deferred revenues are recognized when payments are received in advance of revenue recognition. |
Cost of revenue | (p) Cost of revenue Cost of revenue consists of costs associated with the production of websites, which includes fees paid to third parties for internet connection, content and services, editorial personnel related costs, amortization of intangible assets, depreciation associated with website production equipment and fees paid to SINA for advertising on non-real estate channels. |
Marketing and advertising expenses | (q) Marketing and advertising expenses Marketing and advertising expenses consists primarily of targeted online and offline marketing costs for promoting our e-commerce projects, increasing our visibility and building our brand, such as Leju property visit, sponsored marketing campaigns, online or print advertising, public relations and sponsored events. The Company expenses all marketing advertising costs as incurred and record these costs within “Selling, general and administrative expenses” on the consolidated statements of operations when incurred. The nature of the Company’s direct marketing activities is such that they are intended to attract subscribers for the online advertising and potential property buyers to purchase the discount coupons. The Group incurred marketing and advertising expenses amounting to $96,288,501, $196,396,734 and $306,846,482 for the years ended December 31, 2013, 2014 and 2015, respectively. |
Foreign currency translation | (r) Foreign currency translation The functional currency of the Company is the United States dollar (“U.S. dollar”) and is used as the reporting currency of the Group. Monetary assets and liabilities denominated in currencies other than the U.S. dollar are translated into U.S. dollar at the rates of exchange ruling at the balance sheet date. Equity accounts are translated at historical exchange rates and revenues, expenses, gains and losses are translated using the average rate for the year. Translation adjustments are reported as foreign currency translation adjustment and are shown as a separate component of other comprehensive income in the consolidated statements of changes in equity and comprehensive income. The financial records of certain of the Company’s subsidiaries are maintained in local currencies other than the U.S. dollar, such as Renminbi (“RMB”) and Hong Kong dollar (“HKD”), which are their functional currencies. Transactions in other currencies are recorded at the rates of exchange prevailing when the transactions occur. Transaction gains and losses are recognized in the consolidated statements of operations. The Group recorded an exchange loss of $249,944, an exchange gain $88,721 and $156,641 for the years ended December 31, 2013, 2014 and 2015, respectively, as a component of other loss, net. |
Government subsidies | (s) Government subsidies Government subsidies include cash subsidies received by the Company’s subsidiaries in the PRC from local governments. These subsidies are generally provided as incentives for conducting business in certain local districts and are typically granted based on the amount of value-added tax, business tax, and income tax payment generated by the Group in certain local districts. Such subsidies allow the Group full discretion in utilizing the funds and are used by the Group for general corporate purpose. The local governments have final discretion as to the amount of cash subsidies. Cash subsidies of $599,894, $2,525,496 and $3,567,965 were included in other operating income for the years ended December 31, 2013, 2014 and 2015, respectively. Subsidies are recognized when cash is received and when all the conditions for their receipt have been satisfied. |
Concentration of credit risk | (t) Concentration of credit risk Financial instruments that potentially expose the Group to concentrations of credit risk consist primarily of cash and cash equivalents, accounts receivable and customer deposit. The Group places its cash and cash equivalents with reputable financial institutions. The Group regularly reviews the creditworthiness of its customers, and requires collateral or other security from its customers in certain circumstances when accounts receivables’ aging is over one year. The Group establishes an allowance for doubtful accounts primarily based upon factors surrounding the credit risk of specific customers, including creditworthiness of the clients, aging of the receivables and other specific circumstances related to the accounts. Movement of the allowance for doubtful accounts for accounts receivable is as follows: Year Ended December 31, 2013 2014 2015 $ $ $ Balance as of January 1 Provisions for doubtful accounts Write offs ) ) ) Changes due to foreign exchange ) ) Balance as of December 31 The allowance for other receivables was nil for all periods presented. |
Earnings per share | (u) Earnings per share Basic earnings per share are computed by dividing income attributable to holders of ordinary shares by the weighted average number of ordinary shares outstanding during the period. Diluted earnings per ordinary share reflects the potential dilution that could occur if securities or other contracts to issue ordinary shares were exercised or converted into ordinary shares. The following table sets forth the computation of basic and diluted income per share for the periods indicated: Year Ended December 31, 2013 2014 2015 Net income attributable to Leju ordinary shareholders—basic and diluted $ $ $ Weighted average number of ordinary shares outstanding—basic Stock options — Weighted average number of ordinary shares outstanding—diluted Basic earnings per share $ $ $ Diluted earnings per share $ $ $ Diluted earnings per share do not include the following instruments as their inclusion would have been anti-dilutive: Year Ended December 31, 2013 2014 2015 Share options and restricted shares — |
Non-controlling interest | (v) Non-controlling interest Non-controlling interest are classified as a separate line item in the equity section and disclosures in the Company’s consolidated financial statements have distinguished the interest of Leju from the interest of non-controlling interest holders. |
Comprehensive income | (w) Comprehensive income Comprehensive income includes all changes in equity except those resulting from investments by owners and distributions to owners. For the years presented, total comprehensive income included net income and foreign currency translation adjustments. |
Recently issued accounting pronouncements | (x) Recently issued accounting pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued, ASU 2014-09, “Revenue from Contracts with Customers (Topic 606)”. The guidance replaces almost all exiting revenue recognition guidance, including industry specific guidance, in current US GAAP. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, an entity should apply the following steps: Step 1: Identify the contract(s) with a customer. Step 2: Identify the performance obligations in the contract. Step 3: Determine the transaction price. Step 4: Allocate the transaction price to the performance obligations in the contract. Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation. ASU 2014-09 is originally effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. ASU 2015-14, Revenue from Contracts with Customers, defers the effective date of ASU 2014-09 by one year. As a result, ASU 2014-09 is effective for annual reporting periods beginning after December 15, 2017 and interim periods therein. Early adoption is permitted to the original effective date. The Group is in the process of evaluating the impact of adoption of this guidance on the Group’s consolidated financial statements. In August 2015, the FASB issued a new pronouncement, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date. The amendments in this ASU provide that public business entities should apply the guidance in ASU 2014-09 to annual reporting periods beginning after December 15, 2017, including interim reporting periods within that reporting period. Earlier application is permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period. The Company is in the process of evaluating the impact of the standard on our consolidated financial statements. In February 2015, the FASB issued, ASU 2015-02, “Amendments to the Consolidation Analysis”, regarding consolidation of legal entities such as limited partnerships, limited liability corporations, and securitization structures. The guidance eliminates the deferral issued by the FASB in February 2010 of the accounting guidance for VIE for certain investment funds, including mutual funds, private equity funds and hedge funds. In addition, the guidance amends the evaluation of fees paid to a decision maker or a service provider, and exempts certain money market funds from consolidation. The guidance will be effective for accounting periods beginning after December 15, 2015 with early adoption permitted. The Group early adopted ASU 2015-02 for the year ended December 31, 2015. In adopting the guidance, the Company re-evaluated the existing consolidated VIEs and assessed that the adoption neither changes the conclusion of the consolidated VIEs and nor requires new VIEs to be consolidated, and as such has not had a material impact on the Group’s consolidated financial statements. In September 2015, the FASB issued ASU2015- 16 related to the accounting for measurement period adjustments recognized in a business combination. Under the previous standard, when adjustments were made to amounts previously reported as part of a business combination during the measurement period, entities were required to revise comparative information for prior periods. Under the new standard, entities must recognize these adjustments in the reporting period in which the amounts are determined rather than retrospectively. The new standard is effective for fiscal years beginning after December 15, 2015, including interim periods within that reporting period and early adoption is permitted. The Group does not expect the adoption of this guidance will have a significant effect on the Group’s consolidated financial statements. In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes, which requires deferred income tax liabilities and assets to be classified as noncurrent on the balance sheet rather than being separated into current and noncurrent. The guidance is effective for public entities for annual periods beginning after December 15, 2016, and interim periods within those annual periods with early adoption being permitted. The ASU will only have an impact on the Group’s presentation of tax assets and liabilities in the Group’s consolidated balance sheets upon adoption. In January 2016, the FASB issued ASU 2016-01, Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities (“ASU 2016-01”), which requires that equity investments, except for those accounted for under the equity method or those that result in consolidation of the investee, be measured at fair value, with subsequent changes in fair value recognized in net income. However, an entity may choose to measure equity investments that do not have readily determinable fair values at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. ASU 2016-01 also impacts the presentation and disclosure requirements for financial instruments. ASU 2016-01 is effective for public business entities for annual periods, and interim periods within those annual periods, beginning after December 15, 2017. Early adoption is permitted only for certain provisions. The Group is in the process of evaluating the impact of adoption of this guidance on the Group’s consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), which requires lessees to recognize most leases on the balance sheet. This ASU requires lessees to recognize a right-of-use asset and lease liability for all leases with terms of more than 12 months. Lessees are permitted to make an accounting policy election to not recognize the asset and liability for leases with a term of twelve months or less. The ASU does not significantly change the lessees’ recognition, measurement and presentation of expenses and cash flows from the previous accounting standard. Lessors’ accounting under the ASC is largely unchanged from the previous accounting standard. In addition, the ASU expands the disclosure requirements of lease arrangements. Lessees and lessors will use a modified retrospective transition approach, which includes a number of practical expedients. The provisions of this guidance are effective for annual periods beginning after December 15, 2018, and interim periods within those years, with early adoption permitted. The Group is in the process of evaluating the impact of adoption of this guidance on the Group’s consolidated financial statements. In March 2016, the FASB issued ASU 2016-07, which eliminates the requirement to retroactively adopt the equity method of accounting. The amendments require that the equity method investor add the cost of acquiring the additional interest in the investee to the current basis of the investor’s previously held interest and adopt the equity method of accounting as of the date the investment becomes qualified for equity method accounting. The amendments in this Update are effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016. The amendments should be applied prospectively upon their effective date to increases in the level of ownership interest or degree of influence that result in the adoption of the equity method. Earlier application is permitted. The Group is in the process of evaluating the impact of adoption of this guidance on the consolidated financial statements. In March 2016, the FASB issued ASU 2016-08, which amends the principal-versus-agent implementation guidance and illustrations in the Board’s new revenue standard (ASC 606). The amendments in this update clarify the implementation guidance on principal versus agent considerations. When another party, along with the reporting entity, is involved in providing goods or services to a customer, an entity is required to determine whether the nature of its promise is to provide that good or service to the customer (as a principal) or to arrange for the good or service to be provided to the customer by the other party (as an agent). The guidance is effective for interim and annual periods beginning after December 15, 2017. The Group is in the process of evaluating the impact of adoption of this guidance on the consolidated fin0ancial statements. In March 2016, the FASB issued ASU 2016-09, which simplifies several aspects of the accounting for employee share-based payment transactions for both public and nonpublic entities, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. For public entities, the ASU is effective for annual reporting periods beginning after December 15, 2016, including interim periods within those annual reporting periods. Early adoption will be permitted in any interim or annual period for which financial statements have not yet been issued or have not been made available for issuance. The Group is in the process of evaluating the impact of adoption of this guidance on the consolidated financial statements. |
Organization and Principal Ac26
Organization and Principal Activities (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Organization and Principal Activities | |
Schedule of Major Subsidiaries And Consolidated VIEs | The following table lists major subsidiaries and the consolidated VIEs of the Company as of December 31, 2015: Date of Incorporation Place of Incorporation Percentage of Ownership Shanghai SINA Leju Information Technology Co., Ltd (“Shanghai SINA Leju”) 08-May-08 PRC % City Rehouse 04-Mar-10 PRC % Shanghai Yi Yue Information Technology Co., Ltd (“Shanghai Yi Yue”) 16-Sep-11 PRC % Beijing Maiteng Fengshun Science and Technology Co., Ltd (“Beijing Maiteng”) 04-Jan-12 PRC % Beijing Leju 13-Feb-08 PRC VIE Shanghai Yi Xin 05-Dec-11 PRC VIE Beijing Jiajujiu 22-Mar-12 PRC VIE |
Summary of Principal Accounti27
Summary of Principal Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Summary of Principal Accounting Policies | |
Schedule of foreign owned subsidiaries economic ownership in variable interest entities | Name of Foreign Owned Subsidiaries Foreign Owned Subsidiaries’ Economic Ownership of VIES Name of VIEs Activities of VIEs Shanghai SINA Leju % Beijing Leju Operate the online advertising and listing business Shanghai Yi Yue % Shanghai Yi Xin Operate the e-commerce business Beijing Maiteng % Beijing Jiajujiu Operate the online home furnishing business |
Schedule of financial statement amounts and balances of the Group's VIEs | As of December 31, 2014 2015 $ $ Cash and cash equivalents Accounts receivable, net of allowance for doubtful accounts Customer deposits — Amounts due from related parties Other current assets Total current assets Total non-current assets Total assets Accounts payable Accrued payroll and welfare expenses Income tax payable Other tax payable Amounts due to related parties Advance from customers Liability for accrued marketing and advertising expenses Liability for unpaid consideration of acquiring non-controlling interest Other current liabilities Total current liabilities Deferred tax liabilities, non-current Total liabilities Year Ended December 31, 2013 2014 2015 $ $ $ Total revenues Cost of revenues ) ) ) Net income Net cash provided by operating activities Net cash used in investing activities ) ) ) Net cash used in financing activities ) ) ) |
Schedule of Property, Plant and Equipment, Useful Life | Leasehold improvements Over the shorter of the lease term or their estimated useful lives Buildings 30 years Furniture, fixtures and equipment 3-5 years Motor vehicles 5 years |
Schedule of movement of the allowance for doubtful accounts for accounts receivable | Year Ended December 31, 2013 2014 2015 $ $ $ Balance as of January 1 Provisions for doubtful accounts Write offs ) ) ) Changes due to foreign exchange ) ) Balance as of December 31 |
Schedule of the computation of basic and diluted income per share | Year Ended December 31, 2013 2014 2015 Net income attributable to Leju ordinary shareholders—basic and diluted $ $ $ Weighted average number of ordinary shares outstanding—basic Stock options — Weighted average number of ordinary shares outstanding—diluted Basic earnings per share $ $ $ Diluted earnings per share $ $ $ |
Schedule of antidilutive securities excluded from computation of diluted earnings (loss) per share | Year Ended December 31, 2013 2014 2015 Share options and restricted shares — |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Property and Equipment, Net | |
Schedule of property and equipment, net | As of December 31, 2014 2015 $ $ Furniture, fixtures and equipment Leasehold improvements Buildings Motor vehicles Total Accumulated depreciation ) ) Property and equipment, net |
Intangible Assets, Net (Tables)
Intangible Assets, Net (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Intangible Assets, Net | |
Schedule of intangible assets, net | As of December 31, Weighted Average Remaining Amortization Period in Years 2014 2015 $ $ Intangible assets subject to amortization are comprised of the following: Advertising agency agreement with SINA License agreements with SINA Exclusive rights with Baidu — Customer relationship Database license Non-compete agreements — Computer software licenses Less: Accumulated amortization Advertising agency agreement License agreements with SINA Exclusive rights with Baidu Customer relationship Database license Non-compete agreements Computer software licenses Intangible assets subject to amortization, net Total intangible assets, net |
Goodwill (Tables)
Goodwill (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Goodwill | |
Schedule of changes in the carrying amount of goodwill | 2013 2014 2015 $ $ $ Balance as of January 1 Exchange rate translation ) ) Balance as of December 31 As of December 31, 2014 2015 $ $ Goodwill, gross Accumulated impairment charge ) ) Goodwill, net |
Other Income (Loss), Net (Table
Other Income (Loss), Net (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Other Income (Loss), Net | |
Schedule of other Income (loss), net | Year Ended December 31, 2013 2014 2015 $ $ $ Amortized discounts related to liability for exclusive rights ) ) — Foreign exchange (loss) gain ) Others — — Total ) |
Income Tax (Tables)
Income Tax (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Income Tax | |
Schedule of components of Income (loss) before income taxes | Year Ended December 31, 2013 2014 2015 $ $ $ Income (loss) before income taxes: PRC Outside of PRC ) ) ) Total |
Schedule of expense (benefit) for income taxes | Year Ended December 31, 2013 2014 2015 $ $ $ Current Tax PRC Outside of PRC — Deferred Tax PRC ) ) ) Outside of PRC — — — ) ) ) Income tax expense |
Schedule of principal components of the deferred income tax assets/liabilities | As of December 31, 2014 2015 $ $ Deferred tax assets: Accrued salary expenses Bad debt provision Net operating loss carry forwards Advertising expenses temporarily non-deductible Other Gross deferred tax assets Valuation allowance ) ) Total deferred tax assets Analysis as: Current Non-current Deferred tax liabilities: Amortization of intangible and other assets Total deferred tax liabilities Analysis as: Current — — Non-current |
Schedule of movement of the valuation allowance | Year Ended December 31, 2013 2014 2015 $ $ $ Balance as of January 1 ) ) ) Reverse (additions) ) — Write off — — Changes due to exchange rate translation ) Balance as of December 31 ) ) ) |
Schedule of reconciliation between the provision for income tax computed by applying the statutory tax rate to income before income taxes and the actual provision for income taxes | Year Ended December 31, 2013 2014 2015 PRC income tax rate % % % Share based compensation expenses not deductible for tax purposes % % % Other expenses not deductible for tax purposes % % % Effect of tax holiday )% )% )% Effect of different tax rate of subsidiary operation in other jurisdiction % % % Effect of different tax rate of DTA and DTL applied )% % )% Valuation allowance movement % — )% Withholding tax — % % Other % — — % % % |
Schedule of the aggregate amount and per share effect of the tax holiday | Year Ended December 31, 2013 2014 2015 $ $ $ The aggregate dollar effect Per share effect—basic Per share effect—diluted |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Leju Plan | |
Share-Based Compensation | |
Schedule of assumptions used to estimate the fair value of share options granted | 2013 2015 Risk-free rate of return Contractual life of option 10 years 10 years Estimated volatility rate Dividend yield |
Summary of share option activity | Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term Weighted Average Aggregate Intrinsic Value of Options $ Outstanding, as of January 1, 2015 Granted Exercised ) Forfeited ) Outstanding, as of December 31, 2015 Vested and expected to vest as of December 31, 2015 Exercisable as of December 31, 2015 |
Summary of restricted share activity | Number of Restricted Shares Weighted Average Grant-date Fair Value $ Outstanding, as of January 1, 2015 Granted — Vested ) Forfeited ) Outstanding, as of December 31, 2015 |
Omnigold Plan | |
Share-Based Compensation | |
Schedule of assumptions used to estimate the fair value of share options granted | 2015 Risk-free rate of return Contractual life of option 10 years Estimated volatility rate Dividend yield |
Summary of share option activity | Number of Options Exercise Price Remaining Contractual Term Aggregate Intrinsic Value of Options $ Outstanding, as of January 1, 2015 — Granted — Exercised — Forfeited ) — Outstanding, as of December 31, 2015 — Vested and expected to vest as of December 31, 2015 — Exercisable as of December 31, 2015 — |
E-House Plan | |
Share-Based Compensation | |
Summary of share option activity | Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term Weighted Average Aggregate Intrinsic Value of Options Outstanding, as of January 1, 2015 Exercised ) Forfeited ) Outstanding, as of December 31, 2015 Vested and expected to vest as of December 31, 2015 Exercisable as of December 31, 2015 |
Summary of restricted share activity | Weighted Number of Average Restricted Grant-date Shares Fair Value $ Unvested as of January 1, 2015 Granted — Vested ) Forfeited ) Unvested as of December 31, 2015 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Segment Information | |
Summary of the revenue information of the Group | Year Ended December 31, 2013 2014 2015 $ $ $ E-commerce Online advertising Listing |
Accounts receivable | Customer risk | |
CONCENTRATION OF RISK | |
Schedule of concentration risk | As of December 31, 2014 2015 $ $ Customer A |
Related Party Balances and Tr35
Related Party Balances and Transactions (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Related Party Balances and Transactions | |
Schedule of major related parties and their relationships | Company Name Relationship with the Group E-House Under the common control of E-House Holdings SINA Mr. Charles Chao, co-chairman of E-House, is SINA’s chairman and chief executive officer Beijing China Real Estate Research Association Technology Ltd. (“CRERAT”) Mr. Xin Zhou, co-chairman and chief executive officer of E-House, is the legal representative of CRERAT, and E-House owns 51% of CRERAT |
Schedule of significant related party transactions | Year Ended December 31, 2013 2014 2015 $ $ $ Corporate expenses allocated from E-House — Corporate service provided by E-House under transitional service agreement — Online advertising agency fee recognized as cost of revenues purchased from SINA Services purchased from/rental paid to E-House Online advertising services provided to CRERAT — — Online advertising services provided to E-House Online advertising services provided to SINA — — Dividend declared and paid to E-House — — |
Schedule of amounts due to related parties | As of December 31, 2014 2015 $ $ SINA (1) E-House (2) Management (3) E-House Management (3) Total (1) The amount due to SINA as of December 31, 2014 and 2015 represents online advertising agency fees payable to SINA. (2) The amount due to E-House as of December 31, 2015 was primarily for corporate service fees charged to Leju, and partially offset by the amount due to online services provided to E-House and revenues collected by E-House on behalf. The balance is interest free and settable on demand. (3) The amount due to management/ E-House management represents consideration paid by management/ E-House management for unvested restricted shares (see Note 10). |
Schedule of rollforward of the payable (receivable) balance | Year Ended December 31, 2013 2014 2015 $ $ $ Balance at January 1 ) Refund loan to E-House for working capital A ) — ) Loans from E-House for capital contribution B — — Dividend declared to E-House C — — Dividend paid to E-House D — — ) Corporate expenses allocated from E-House (Note 1) B — Corporate service provided by E-House under transitional service agreement (Note 1) E — Revenues collected by E-House on behalf of the Company F ) ) — Related party balance waived as capital contribution B ) ) — Service provided to E-House E ) ) ) Service purchased from E-House E Net (payment) receipt for services G ) Balance at December 31 ) (A) Represents the movement of the loan payable to E-House (B) Represents the movement of the loans from E-House for capital contributions and headquarter expenses allocated by E-House prior to Leju’s initial public offering, which were subsequently 100% waived by E-House and recorded as capital contributions by Leju. Accordingly, the net balance at each year end is zero. (C) Represent the cash dividend declared by Leju to its shareholder E-house. In March 2015, the Company’s board of directors approved the payment of a cash dividend of $0.20 per ordinary share ($0.20 per ADS) directly from the additional paid-in capital account. (D) Represent the cash dividend paid to E-House. (E) Represents the movement of service fees receivable from and payable to E-House (F) Represents Leju revenues collected by E-House on behalf of the Company (G) Represents the cash flow between the Company and E-House except to the loan from (refund to ) E-House As of December 31, 2014 2015 $ $ Loan payable to E-House (A) — Service payable to E-House (E) Receivables for E-House collection on behalf of the Company (F) ) ) Amounts due to E-House |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Commitments and Contingencies | |
Schedule of future minimum lease payments under non-cancelable operating lease agreements | Future minimum lease payments under non-cancelable operating lease agreements at December 31, 2015 were as follows: Year Ended December 31 Amount $ 2016 2017 2018 2019 2020 Then thereafter Total |
Organization and Principal Ac37
Organization and Principal Activities (Details) | Apr. 17, 2014USD ($)$ / sharesshares | Mar. 21, 2014USD ($)shares | Dec. 19, 2013USD ($)$ / sharesshares | Mar. 31, 2014USD ($) | Dec. 31, 2015USD ($)$ / sharesshares | Dec. 31, 2014USD ($)$ / sharesshares | Dec. 31, 2013USD ($) | Nov. 20, 2013$ / sharesshares | Oct. 31, 2009 | Feb. 24, 2008 |
Foreign owned subsidiaries economic ownership in variable interest entities | ||||||||||
Common stock, shares authorized | 500,000,000 | 500,000,000 | ||||||||
Common stock, shares issued | 134,930,870 | 134,015,621 | ||||||||
Ordinary shares (in dollars) | $ | $ 134,931 | $ 134,015 | ||||||||
Ordinary shares, shares outstanding | 134,930,870 | 134,015,621 | ||||||||
Ordinary shares, par value (in dollars per share) | $ / shares | $ (0.001) | $ (0.001) | ||||||||
Selling, general and administrative expenses | $ | $ 475,445,516 | $ 366,341,900 | $ 226,142,936 | |||||||
Ordinary Shares | Initial public offering | ||||||||||
Foreign owned subsidiaries economic ownership in variable interest entities | ||||||||||
Number of shares issued or sold | 11,500,000 | |||||||||
Share price | $ / shares | $ 10 | |||||||||
Net proceeds from IPO | $ | $ 101,400,000 | |||||||||
ADSs | Initial public offering | ||||||||||
Foreign owned subsidiaries economic ownership in variable interest entities | ||||||||||
Number of shares issued or sold | 11,500,000 | |||||||||
Tencent | Ordinary Shares | Private placement | ||||||||||
Foreign owned subsidiaries economic ownership in variable interest entities | ||||||||||
Number of shares issued or sold | 2,029,420 | |||||||||
Net proceeds from private placement | $ | $ 18,900,000 | |||||||||
Tencent | ADSs | Initial public offering | ||||||||||
Foreign owned subsidiaries economic ownership in variable interest entities | ||||||||||
Share price | $ / shares | $ 10 | |||||||||
Shanghai SINA Leju | ||||||||||
Foreign owned subsidiaries economic ownership in variable interest entities | ||||||||||
Ownership percentage | 100.00% | |||||||||
Shanghai Yi Yue | ||||||||||
Foreign owned subsidiaries economic ownership in variable interest entities | ||||||||||
Ownership percentage | 100.00% | |||||||||
Beijing Maiteng | ||||||||||
Foreign owned subsidiaries economic ownership in variable interest entities | ||||||||||
Ownership percentage | 84.00% | |||||||||
City Rehouse | ||||||||||
Foreign owned subsidiaries economic ownership in variable interest entities | ||||||||||
Ownership percentage | 100.00% | |||||||||
CRIC | COHT | ||||||||||
Foreign owned subsidiaries economic ownership in variable interest entities | ||||||||||
Ownership percentage | 66.00% | |||||||||
E-House | ||||||||||
Foreign owned subsidiaries economic ownership in variable interest entities | ||||||||||
Common stock, shares authorized | 500,000,000 | |||||||||
Common stock, shares issued | 50,000,000 | 120,000,000 | 50,000 | |||||||
Common stock, shares issued | 70,000,000 | |||||||||
Ordinary shares (in dollars) | $ | $ 70,000 | |||||||||
Ordinary shares, shares outstanding | 50,000,000 | 50,000 | ||||||||
Ordinary shares, par value (in dollars per share) | $ / shares | $ 0.001 | $ 1 | ||||||||
Share split ratio | 0.001 | |||||||||
Selling, general and administrative expenses | $ | $ 2,857,251 | $ 15,527,623 | ||||||||
Corporate service under transitional service agreement | $ | $ 6,040,071 | $ 10,399,978 | ||||||||
E-House | Tencent | Share purchase and subscription agreement | ||||||||||
Foreign owned subsidiaries economic ownership in variable interest entities | ||||||||||
Consideration received | $ | $ 180,000,000 | |||||||||
Number of subsidiary shares acquired by counterparty | 19,201,800 | |||||||||
E-House | COHT | ||||||||||
Foreign owned subsidiaries economic ownership in variable interest entities | ||||||||||
Ownership percentage | 34.00% | |||||||||
SINA | COHT | ||||||||||
Foreign owned subsidiaries economic ownership in variable interest entities | ||||||||||
Ownership percentage | 66.00% |
Summary of Principal Accounti38
Summary of Principal Accounting Policies (Details) | 12 Months Ended |
Dec. 31, 2015 | |
Foreign owned subsidiaries economic ownership in variable interest entities | |
Term of loan agreement | 20 years |
Term of each shareholder voting right proxy agreement | 20 years |
Automatic extended term of shareholder voting right proxy agreement | 1 year |
Beijing Leju | Shanghai SINA Leju | |
Foreign owned subsidiaries economic ownership in variable interest entities | |
Ownership interest (as a percent) | 100.00% |
Shanghai Yi Xin | Shanghai Yi Yue | |
Foreign owned subsidiaries economic ownership in variable interest entities | |
Ownership interest (as a percent) | 100.00% |
Beijing Jiajujiu | Beijing Maiteng | |
Foreign owned subsidiaries economic ownership in variable interest entities | |
Ownership interest (as a percent) | 100.00% |
Summary of Principal Accounti39
Summary of Principal Accounting Policies (Details 2) - USD ($) | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Financial statement amounts and balances of the Group's VIEs | ||||
Cash and cash equivalents | $ 260,295,909 | $ 317,811,056 | $ 98,729,639 | $ 71,090,266 |
Accounts receivable, net of allowance for doubtful accounts | 113,991,480 | 119,741,936 | ||
Customer deposits | 58,833,225 | |||
Amounts due from related parties | 8,906 | 684 | ||
Total current assets | 485,083,945 | 480,766,424 | ||
Accounts payable | 327,140 | 370,652 | ||
Accrued payroll and welfare expenses | 45,691,874 | 48,007,240 | ||
Income tax payable | 66,814,874 | 57,246,193 | ||
Other tax payable | 31,930,296 | 27,804,416 | ||
Amounts due to related parties | 10,214,007 | 5,289,491 | ||
Advance from customers | 5,703,085 | 5,054,408 | ||
Liability for accrued marketing and advertising expenses | 3,914,990 | 19,269,565 | ||
Liability for unpaid consideration for acquiring non-controlling interest | 7,338,593 | 25,645,630 | ||
Other current liabilities | 7,672,494 | 8,613,203 | ||
Total current liabilities | 179,607,353 | 197,300,798 | ||
Deferred tax liabilities, non-current | 22,997,731 | 26,041,591 | ||
Total revenues | 575,803,936 | 496,022,873 | 335,421,516 | |
Cost of revenues | (60,313,726) | (51,129,730) | (63,990,693) | |
Net income | 34,805,905 | 66,659,388 | 42,650,028 | |
Net cash provided by operating activities | 51,274,996 | 124,830,989 | 83,422,980 | |
Net cash used in investing activities | (15,099,773) | (12,355,416) | (16,656,933) | |
Net cash used in financing activities | (85,174,408) | 107,080,458 | (41,359,931) | |
Consolidated VIEs without recourse | ||||
Financial statement amounts and balances of the Group's VIEs | ||||
Cash and cash equivalents | 59,170,627 | 95,927,942 | ||
Accounts receivable, net of allowance for doubtful accounts | 111,300,756 | 117,835,596 | ||
Customer deposits | 38,710,027 | |||
Amounts due from related parties | 13,238,930 | 684 | ||
Other current assets | 42,795,082 | 31,506,971 | ||
Total current assets | 265,215,422 | 245,271,193 | ||
Total non-current assets | 22,008,141 | 27,333,289 | ||
Total assets | 287,223,563 | 272,604,482 | ||
Accounts payable | 327,140 | 370,652 | ||
Accrued payroll and welfare expenses | 34,784,706 | 40,946,532 | ||
Income tax payable | 27,599,392 | 26,702,856 | ||
Other tax payable | 17,268,065 | 15,883,568 | ||
Amounts due to related parties | 1,418,096 | 30,147,834 | ||
Advance from customers | 5,366,944 | 4,617,183 | ||
Liability for accrued marketing and advertising expenses | 733,473 | 3,691,831 | ||
Liability for unpaid consideration for acquiring non-controlling interest | 7,338,593 | 25,645,630 | ||
Other current liabilities | 6,340,375 | 5,137,314 | ||
Total current liabilities | 101,176,784 | 153,143,400 | ||
Deferred tax liabilities, non-current | 523,874 | 469,579 | ||
Total liabilities | 101,700,658 | 153,612,979 | ||
Total revenues | 558,714,556 | 484,511,682 | 316,271,620 | |
Cost of revenues | (48,032,280) | (41,218,756) | (58,253,716) | |
Net income | 3,307,694 | 2,532,232 | 1,285,139 | |
Net cash provided by operating activities | 41,577,844 | 57,761,765 | 64,832,510 | |
Net cash used in investing activities | (13,884,075) | (10,927,762) | (16,640,090) | |
Net cash used in financing activities | $ (59,873,366) | $ (14,418,056) | $ (37,824,941) |
Summary of Principal Accounti40
Summary of Principal Accounting Policies (Details 3) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Customer deposits | |||
Customer deposits maturity period | 12 months | ||
Revenue recognition | |||
Total revenue | $ 3,689,272 | $ 4,836,931 | $ 5,556,867 |
Advertising expense | |||
Marketing and advertising expenses | 306,846,482 | 196,396,734 | 96,288,501 |
Foreign currency translation | |||
Foreign exchange loss | 249,944 | ||
Foreign exchange gain | 156,641 | 88,721 | |
Government subsidies | |||
Cash subsidies included in other operating income | 3,567,965 | 2,525,496 | 599,894 |
Movement of the allowance for doubtful accounts for accounts receivable | |||
Balance at the beginning | 15,471,020 | 9,353,689 | 7,393,312 |
Provisions for doubtful accounts | 18,959,895 | 11,599,708 | 6,373,132 |
Write offs | (6,827,314) | (5,437,380) | (4,667,466) |
Changes due to foreign exchange | (1,252,787) | (44,997) | 254,711 |
Balance at the end | 26,350,814 | 15,471,020 | 9,353,689 |
Allowance for other receivables | $ 0 | $ 0 | $ 0 |
Buildings | |||
Property and equipment, net | |||
Estimated useful lives | P30Y | ||
Motor vehicles | |||
Property and equipment, net | |||
Estimated useful lives | P5Y | ||
Minimum | Furniture, fixtures and equipment | |||
Property and equipment, net | |||
Estimated useful lives | P3Y | ||
Maximum | Furniture, fixtures and equipment | |||
Property and equipment, net | |||
Estimated useful lives | P5Y |
Summary of Principal Accounti41
Summary of Principal Accounting Policies (Details 4) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Earnings per share | |||
Net income attributable to Leju ordinary shareholders-basic and diluted | $ 35,330,089 | $ 66,520,894 | $ 42,524,962 |
Weighted average number of ordinary shares outstanding-basic (in shares) | 134,528,971 | 129,320,666 | 120,000,000 |
Stock options | 1,695,003 | 3,181,434 | |
Weighted average number of ordinary shares outstanding - diluted (in shares) | 136,223,974 | 132,502,100 | 120,000,000 |
Basic earnings per share (in dollars per share) | $ 0.26 | $ 0.51 | $ 0.35 |
Diluted earnings per share (in dollars per share) | $ 0.26 | $ 0.50 | $ 0.35 |
Share options and restricted shares | |||
Antidilutive instruments excluded from computation of diluted earnings (loss) per share | |||
Antidilutive securities excluded from computation of diluted earnings (loss) per share | 2,464,500 | 599,333 |
Acquisition of Non-controllin42
Acquisition of Non-controlling Interests (Details) | 1 Months Ended | 12 Months Ended | |||||||
Sep. 30, 2014CNY (¥)item | Sep. 30, 2014USD ($)item | Jan. 31, 2014CNY (¥)item | Jan. 31, 2014USD ($)item | Dec. 31, 2014USD ($) | Dec. 31, 2015CNY (¥) | Dec. 31, 2015USD ($) | Dec. 31, 2014CNY (¥) | Dec. 31, 2014USD ($) | |
Acquisition of Non-controlling Interests. | |||||||||
Decrease in equity attributable to Leju's shareholders | $ 32,469,069 | ||||||||
Liability for Consideration Payable of Acquiring Non-controlling Interest | $ 7,338,593 | $ 25,645,630 | |||||||
Group of five employees | |||||||||
Acquisition of Non-controlling Interests. | |||||||||
Number of years should serve by five employee individual shareholders after acquisition | 2 years | 2 years | |||||||
Total unrecognized compensation expense | $ 4,276,810 | 1,603,805 | 3,742,209 | ||||||
Recognition period of stock based compensation expense | 2 years | 2 years | |||||||
Beijing Lotta | |||||||||
Acquisition of Non-controlling Interests. | |||||||||
Number of individual shareholders entered into equity transfer agreement | item | 2 | 2 | |||||||
Percentage of shares acquired | 40.00% | 40.00% | |||||||
Total consideration | ¥ 100,000,000 | $ 16,254,600 | |||||||
Additional paid-in capital derecognized | 15,112,828 | ||||||||
Non-controlling interest derecognized | 1,141,772 | ||||||||
Liability for Consideration Payable of Acquiring Non-controlling Interest | ¥ 22,000,000 | 3,387,956 | ¥ 44,000,000 | 7,190,700 | |||||
Tianjin Leju | |||||||||
Acquisition of Non-controlling Interests. | |||||||||
Percentage of shares acquired | 30.00% | ||||||||
Total consideration | ¥ 28,830,000 | $ 4,685,913 | |||||||
Additional paid-in capital derecognized | 4,449,469 | ||||||||
Non-controlling interest derecognized | 236,444 | ||||||||
Liability for Consideration Payable of Acquiring Non-controlling Interest | 243,989 | 2,871,268 | |||||||
E-House | |||||||||
Acquisition of Non-controlling Interests. | |||||||||
Number of employee individual shareholders entered into equity transfer agreement | item | 5 | 5 | |||||||
Beijing Leju Advertisement and Yisheng Shanghai | |||||||||
Acquisition of Non-controlling Interests. | |||||||||
Number of individual shareholders entered into equity transfer agreement | item | 6 | 6 | |||||||
Percentage of shares acquired | 24.50% | ||||||||
Total consideration | ¥ 117,355,000 | $ 19,074,412 | |||||||
Additional paid-in capital derecognized | 12,906,772 | ||||||||
Non-controlling interest derecognized | 1,890,830 | ||||||||
Liability for Consideration Payable of Acquiring Non-controlling Interest | $ 3,706,648 | $ 15,534,635 | |||||||
Beijing Leju Advertisement and Yisheng Shanghai | Group of five employees | |||||||||
Acquisition of Non-controlling Interests. | |||||||||
Total consideration | ¥ 98,775,000 | 16,054,493 | |||||||
Total consideration for 1% equity interest | $ 823,307 | ||||||||
Percentage of five employee owned | 19.50% | 19.50% | |||||||
Beijing Leju Advertisement and Yisheng Shanghai | Individual share holder | |||||||||
Acquisition of Non-controlling Interests. | |||||||||
Total consideration | ¥ 18,580,000 | $ 3,019,919 | |||||||
Total consideration for 1% equity interest | $ 603,984 | ||||||||
Percentage of other individual shareholders owned | 5.00% | 5.00% | |||||||
Beijing Leju | |||||||||
Acquisition of Non-controlling Interests. | |||||||||
Number of subsidiaries to purchase remaining percentage | item | 2 | 2 |
Property and Equipment, Net (De
Property and Equipment, Net (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Property and equipment, net | |||
Property and equipment, gross | $ 20,354,166 | $ 19,438,247 | |
Accumulated depreciation | (13,553,552) | (12,279,467) | |
Property and equipment, net | 6,800,614 | 7,158,780 | |
Depreciation expenses | 2,626,264 | 3,030,451 | $ 3,021,130 |
Furniture, fixtures and equipment | |||
Property and equipment, net | |||
Property and equipment, gross | 12,492,343 | 11,892,101 | |
Leasehold improvements | |||
Property and equipment, net | |||
Property and equipment, gross | 5,490,605 | 4,976,638 | |
Buildings | |||
Property and equipment, net | |||
Property and equipment, gross | 633,646 | 763,240 | |
Motor vehicles | |||
Property and equipment, net | |||
Property and equipment, gross | $ 1,737,572 | $ 1,806,268 |
Intangible Assets, Net (Details
Intangible Assets, Net (Details) | 1 Months Ended | 12 Months Ended | |||||
Apr. 30, 2015CNY (¥) | Apr. 30, 2015USD ($) | Mar. 31, 2014USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | Dec. 31, 2011USD ($) | |
Intangible Assets, Net | |||||||
Intangible assets subject to amortization | $ 262,983,793 | $ 254,252,555 | |||||
Intangible assets subject to amortization, net | 90,736,828 | 105,418,808 | |||||
Total intangible assets, net | $ 90,736,828 | 105,418,808 | |||||
Weighted Average Remaining Amortization Period | 8 years 5 months 16 days | ||||||
Amortization expenses | $ 26,653,571 | 23,088,327 | $ 35,321,801 | ||||
Amortization of Discounts Related to Liability for Exclusive Rights | 52,922 | 935,177 | |||||
Expected amortization expenses | |||||||
2,016 | 12,416,185 | ||||||
2,017 | 12,202,249 | ||||||
2,018 | 11,304,846 | ||||||
2,019 | 10,801,496 | ||||||
2,020 | 10,576,991 | ||||||
SINA | Advertising agency agreement and license agreements | |||||||
Intangible Assets, Net | |||||||
Percentage of revenue fee on sales | 15.00% | ||||||
Additional extension term of agreement | 5 years | ||||||
Additional consideration upon extension term of agreement | $ 0 | ||||||
Advertising agency agreement | SINA | |||||||
Intangible Assets, Net | |||||||
Intangible assets subject to amortization | 106,790,000 | 106,790,000 | |||||
Less: Accumulated amortization | $ 57,341,459 | 51,286,536 | |||||
Weighted Average Remaining Amortization Period | 8 years 9 months | ||||||
License agreements | SINA | |||||||
Intangible Assets, Net | |||||||
Intangible assets subject to amortization | $ 80,660,000 | 80,660,000 | |||||
Less: Accumulated amortization | $ 43,881,281 | 39,377,764 | |||||
Weighted Average Remaining Amortization Period | 8 years 9 months | ||||||
Exclusive rights | Baidu | |||||||
Intangible Assets, Net | |||||||
Intangible assets subject to amortization | $ 54,096,827 | 45,151,494 | |||||
Less: Accumulated amortization | 54,096,827 | 43,034,803 | |||||
Fair value of intangible assets recognized | $ 43,847,992 | ||||||
Difference between fair value of intangibles and principal amount | 3,764,108 | ||||||
Amortization of Discounts Related to Liability for Exclusive Rights | 0 | 52,922 | 935,177 | ||||
Amount paid in connection with intangible assets | ¥ 75,000,000 | $ 12,023,475 | 12,023,475 | 9,004,710 | $ 15,347,915 | $ 47,612,100 | |
Customer relationship | |||||||
Intangible Assets, Net | |||||||
Intangible assets subject to amortization | 10,538,309 | 10,795,384 | |||||
Less: Accumulated amortization | $ 8,424,820 | 7,530,732 | |||||
Weighted Average Remaining Amortization Period | 3 years 7 months 17 days | ||||||
Database license | |||||||
Intangible Assets, Net | |||||||
Intangible assets subject to amortization | $ 8,300,000 | 8,300,000 | |||||
Less: Accumulated amortization | $ 6,102,942 | 5,126,472 | |||||
Weighted Average Remaining Amortization Period | 2 years 3 months | ||||||
Non-compete agreements | |||||||
Intangible Assets, Net | |||||||
Intangible assets subject to amortization | $ 1,575,336 | 1,657,256 | |||||
Less: Accumulated amortization | 1,575,336 | 1,645,402 | |||||
Computer software licenses | |||||||
Intangible Assets, Net | |||||||
Intangible assets subject to amortization | 1,023,321 | 898,421 | |||||
Less: Accumulated amortization | $ 824,300 | $ 832,038 | |||||
Weighted Average Remaining Amortization Period | 2 years 7 months 21 days |
Goodwill (Details)
Goodwill (Details) - USD ($) | 12 Months Ended | ||||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2015 | Dec. 31, 2014 | |
Changes in the carrying amount of goodwill | |||||
Balance as of January 1 | $ 40,563,075 | $ 40,610,620 | $ 40,215,987 | ||
Exchange rate translation | (755,832) | (47,545) | 394,633 | ||
Balance as of December 31 | 39,807,243 | 40,563,075 | 40,610,620 | ||
Goodwill, net | |||||
Goodwill, gross | $ 457,629,547 | $ 458,385,379 | |||
Accumulated impairment charge | (417,822,304) | (417,822,304) | |||
Goodwill, net | 40,563,075 | 40,610,620 | 40,215,987 | $ 39,807,243 | $ 40,563,075 |
Goodwill impairment charge | $ 0 | $ 0 | $ 0 |
Dividends (Details)
Dividends (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |
May. 31, 2015 | Dec. 31, 2015 | Mar. 31, 2015 | |
Dividends | |||
Dividends to shareholders | $ 26,873,022 | $ 26,873,022 | |
Ordinary Shares | |||
Dividends | |||
Payment of a cash dividend (in dollars per share) | $ 0.20 | ||
ADSs | |||
Dividends | |||
Payment of a cash dividend (in dollars per share) | $ 0.20 |
Other Income (Loss), Net (Detai
Other Income (Loss), Net (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Other Income (Loss), Net | |||
Amortized discounts related to liability for exclusive rights | $ (52,922) | $ (935,177) | |
Foreign exchange (loss) gain | $ 156,641 | 88,721 | (249,944) |
Others | 133,398 | ||
Total | $ 290,039 | $ 35,799 | $ (1,185,121) |
Income Tax (Details)
Income Tax (Details) | 12 Months Ended | ||||
Dec. 31, 2015CNY (¥) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | Dec. 31, 2012USD ($) | |
Income Tax | |||||
PRC | $ 70,382,855 | $ 111,905,366 | $ 91,779,478 | ||
Outside of PRC | (25,041,651) | (29,476,625) | (45,994,531) | ||
Income before taxes and equity in affiliates | 45,341,204 | 82,428,741 | 45,784,947 | ||
The PRC | 17,990,790 | 17,905,374 | 21,147,165 | ||
Outside of the PRC | 17,425 | 10,072 | |||
Current income taxes expenses (benefits) | 18,008,215 | 17,915,446 | 21,147,165 | ||
The PRC | (7,700,893) | (2,369,482) | (18,081,440) | ||
Deferred income taxes expenses (benefits) | (7,700,893) | (2,369,482) | (18,081,440) | ||
Income tax expense | $ 10,307,322 | $ 15,545,964 | $ 3,065,725 | ||
Statutory tax rate (as a percent) | 25.00% | 25.00% | 25.00% | 25.00% | |
Deferred tax assets: | |||||
Accrued salary expenses | $ 11,248,353 | $ 11,991,920 | |||
Bad debt provision | 6,587,704 | 3,867,755 | |||
Net operating loss carry forwards | 3,787,766 | 3,574,524 | |||
Advertising expenses temporarily non-deductible | 11,307,976 | 11,097,262 | |||
Other | 492,160 | 459,506 | |||
Gross deferred tax assets | 33,423,959 | 30,990,967 | |||
Valuation allowance | (654,267) | (957,162) | $ (1,051,973) | $ (831,361) | |
Total deferred tax assets | 32,769,692 | 30,033,805 | |||
Analysis as: | |||||
Current | 31,073,758 | 29,857,574 | |||
Non-current | 1,695,934 | 176,231 | |||
Deferred tax liabilities: | |||||
Amortization of intangible and other assets | 22,997,731 | 26,041,591 | |||
Total deferred tax liabilities | 22,997,731 | 26,041,591 | |||
Analysis as: | |||||
Non-current | $ 22,997,731 | $ 26,041,591 | |||
PRC | |||||
Income Tax | |||||
Period of statute of limitations | 3 years | 3 years | |||
Period of statute of limitations, if the underpayment is more than the specified amount | 5 years | 5 years | |||
Minimum amount of underpayment of taxes for statute of limitations to be extended to five years | ¥ 100,000 | $ 15,400 | |||
Period of statute of limitations for transfer pricing issues | 10 years | 10 years | |||
PRC | Shanghai SINA Leju | High and new technology enterprise | Tax year 2013 through 2014 | |||||
Income Tax | |||||
Preferential tax rate (as a percent) | 15.00% | 15.00% | |||
PRC | Shanghai SINA Leju | High and new technology enterprise | Tax year 2015 through 2017 | |||||
Income Tax | |||||
Preferential tax rate (as a percent) | 15.00% | 15.00% | |||
PRC | Shanghai Fangxin information technology Co., Ltd. | Software Enterprise | Tax year 2014 through 2016 | |||||
Income Tax | |||||
Reduction in tax for the year following the exemption period (as a percent) | 50.00% | 50.00% | |||
Preferential tax rate (as a percent) | 12.50% | 12.50% | |||
Hong Kong | |||||
Income Tax | |||||
Tax rate (as a percent) | 16.50% | 16.50% |
Income Tax (Details 2)
Income Tax (Details 2) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Movement of the valuation allowance | |||
Balance at the beginning of the period | $ (957,162) | $ (1,051,973) | $ (831,361) |
Reverse (additions) | 255,264 | (194,892) | |
Write off | 90,811 | ||
Changes due to exchange rate translation | 47,631 | 4,000 | (25,720) |
Balance at the end of the period | $ (654,267) | $ (957,162) | $ (1,051,973) |
Income Tax | |||
Cumulative loss incurred period as significant piece of objective negative evidence evaluated | 3 years | ||
Reconciliation between the provision for income tax computed by applying the statutory tax rate to income before income taxes and the actual provision for income taxes | |||
PRC income tax rate (as a percent) | 25.00% | 25.00% | 25.00% |
Share based compensation expenses not deductible for tax purposes (as a percent) | 5.17% | 3.27% | 3.45% |
Other expenses not deductible for tax purposes (as a percent) | 3.71% | 0.72% | 1.12% |
Effect of tax holiday (as a percent) | (13.18%) | (13.69%) | (19.06%) |
Effect of different tax rate of subsidiary operation in other jurisdiction (as a percent) | 2.05% | 1.08% | 0.02% |
Effect of different tax rate of DTA and DTL applied (as a percent) | (2.37%) | 2.29% | (4.36%) |
Valuation allowance movement (as a percent) | (0.56%) | 0.42% | |
Withholding tax | 2.91% | 0.19% | |
Other (as a percent) | 0.11% | ||
Income tax rate (as a percent) | 22.73% | 18.86% | 6.70% |
Aggregate amount and per share effect of the tax holiday | |||
The aggregate dollar effect | $ 5,977,806 | $ 11,285,429 | $ 8,725,381 |
Per share effect-basic (in dollars per share) | $ 0.04 | $ 0.09 | $ 0.07 |
Per share effect-diluted (in dollars per share) | $ 0.04 | $ 0.09 | $ 0.07 |
Income Tax (Details 3)
Income Tax (Details 3) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Income Tax | |||
Tax operating loss carry forwards | $ 15,151,067 | $ 14,298,098 | |
Deemed distribution to E-House associated with tax liability | $ 571,227 | $ 2,381,799 | |
PRC | |||
Income Tax | |||
Undistributed earnings | 240,339,365 | ||
Provision for Chinese dividend withholding taxes | $ 0 | ||
Preferential withholding tax rate (as a percent) | 5.00% | ||
PRC | Minimum | |||
Income Tax | |||
Deferred income tax liability for the undistributed earnings | $ 12,016,968 | ||
Withholding income tax rate for dividends distributed (as a percent) | 5.00% | ||
PRC | Maximum | |||
Income Tax | |||
Deferred income tax liability for the undistributed earnings | $ 24,033,937 | ||
Withholding income tax rate for dividends distributed (as a percent) | 10.00% |
Share-Based Compensation (Detai
Share-Based Compensation (Details) - USD ($) | Aug. 11, 2015 | Aug. 21, 2014 | Mar. 18, 2014 | Dec. 16, 2013 | Dec. 01, 2013 | Aug. 31, 2015 | Jan. 31, 2014 | Nov. 30, 2013 | Aug. 31, 2013 | Nov. 30, 2012 | Oct. 31, 2010 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2006 |
Leju Plan | |||||||||||||||
Share-Based Compensation | |||||||||||||||
Expiration period | 10 years | ||||||||||||||
Leju Plan | Maximum | |||||||||||||||
Share-Based Compensation | |||||||||||||||
Number of shares that may be issued as a percentage of total outstanding shares | 8.00% | ||||||||||||||
Leju Plan | Employees Share Options | |||||||||||||||
Share-Based Compensation | |||||||||||||||
Exercise price of shares granted (in dollars per share) | $ 6.38 | ||||||||||||||
Assumptions used in the binomial model | |||||||||||||||
Risk-free rate of return (as a percent) | 2.14% | 2.98% | |||||||||||||
Contractual life of option | 10 years | 10 years | |||||||||||||
Estimated volatility rate (as a percent) | 62.82% | 56.74% | |||||||||||||
Dividend yield (as a percent) | 2.56% | 0.00% | |||||||||||||
Additional disclosure | |||||||||||||||
Weighted-average grant-date fair value of options granted (in dollars per share) | $ 3.44 | $ 2.21 | |||||||||||||
Total intrinsic value of options exercised | $ 949,907 | $ 1,668,693 | |||||||||||||
Total unrecognized compensation expense | $ 11,525,658 | ||||||||||||||
Weighted-average period over which cost is expected to be recognized | 2 years 1 month 17 days | ||||||||||||||
Leju Plan | Employees Share Options | Group's employees | |||||||||||||||
Share-Based Compensation | |||||||||||||||
Award vesting period | 3 years | ||||||||||||||
Expiration period | 10 years | ||||||||||||||
Options granted for purchase of shares | 2,517,000 | ||||||||||||||
Leju Plan | Employees Share Options | Certain Group's Employees and E-House's Employees | |||||||||||||||
Share-Based Compensation | |||||||||||||||
Award vesting period | 3 years | ||||||||||||||
Expiration period | 10 years | ||||||||||||||
Options granted for purchase of shares | 7,192,000 | ||||||||||||||
Exercise price of shares granted (in dollars per share) | $ 4.60 | ||||||||||||||
Leju Plan | Employees Share Options | Minimum | Group's employees | |||||||||||||||
Share-Based Compensation | |||||||||||||||
Exercise price of shares granted (in dollars per share) | $ 5.54 | ||||||||||||||
Leju Plan | Employees Share Options | Maximum | Group's employees | |||||||||||||||
Share-Based Compensation | |||||||||||||||
Exercise price of shares granted (in dollars per share) | $ 9.68 | ||||||||||||||
Leju Plan | Restricted Shares | |||||||||||||||
Additional disclosure | |||||||||||||||
Total unrecognized compensation expense | $ 4,384,344 | ||||||||||||||
Weighted-average period over which cost is expected to be recognized | 1 year 2 months 9 days | ||||||||||||||
Leju Plan | Restricted Shares | Group's employees, directors and officers | |||||||||||||||
Share-Based Compensation | |||||||||||||||
Award vesting period | 8 months | 3 years | |||||||||||||
Granted (in shares) | 229,400 | 866,000 | |||||||||||||
Leju Plan | Leju Replacement Restricted Shares | |||||||||||||||
Share-Based Compensation | |||||||||||||||
Exercise price of shares granted (in dollars per share) | $ 4.60 | $ 4.60 | |||||||||||||
Number of replacement awards exchanged with replaced awards (in shares) | 600,000 | 60,000 | |||||||||||||
E-House Plan | |||||||||||||||
Share-Based Compensation | |||||||||||||||
Number of shares authorized | 3,636,364 | ||||||||||||||
Number of shares that may be issued as a percentage of total outstanding shares | 5.00% | ||||||||||||||
Award grant period | 3 years | ||||||||||||||
Additional number of shares authorized | 6,644,659 | 1,273,000 | 4,013,619 | ||||||||||||
Expiration period | 10 years | ||||||||||||||
E-House Plan | Employees Share Options | |||||||||||||||
Additional disclosure | |||||||||||||||
Total intrinsic value of options exercised | $ 1,745,007 | $ 23,679,729 | $ 25,248,554 | ||||||||||||
Total unrecognized compensation expense | $ 0 | ||||||||||||||
E-House Plan | Restricted Shares | |||||||||||||||
Share-Based Compensation | |||||||||||||||
Award vesting period | 3 years | ||||||||||||||
Granted (in shares) | 0 | 1,439,000 | 1,303,000 | ||||||||||||
Additional disclosure | |||||||||||||||
Total unrecognized compensation expense | $ 11,558,404 | ||||||||||||||
Weighted-average period over which cost is expected to be recognized | 1 year 6 months 11 days | ||||||||||||||
Omnigold Plan | |||||||||||||||
Share-Based Compensation | |||||||||||||||
Number of shares authorized | 5,000,000 | ||||||||||||||
Number of shares that may be issued as a percentage of total outstanding shares | 5.00% | ||||||||||||||
Additional disclosure | |||||||||||||||
Weighted-average grant-date fair value of options granted (in dollars per share) | $ 0.30 | ||||||||||||||
Total unrecognized compensation expense | $ 545,884 | ||||||||||||||
Weighted-average period over which cost is expected to be recognized | 2 years 7 months 10 days | ||||||||||||||
Omnigold Plan | Employees Share Options | |||||||||||||||
Share-Based Compensation | |||||||||||||||
Award vesting period | 3 years | ||||||||||||||
Expiration period | 10 years | ||||||||||||||
Options granted for purchase of shares | 2,400,000 | ||||||||||||||
Exercise price of shares granted (in dollars per share) | $ 1.50 | $ 1.50 | |||||||||||||
Assumptions used in the binomial model | |||||||||||||||
Risk-free rate of return (as a percent) | 3.33% | ||||||||||||||
Contractual life of option | 10 years | ||||||||||||||
Estimated volatility rate (as a percent) | 63.69% | ||||||||||||||
Dividend yield (as a percent) | 0.00% |
Share-Based Compensation (Det52
Share-Based Compensation (Details 2) - USD ($) | Aug. 11, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Leju Plan | Employees Share Options | ||||
Share-Based Compensation | ||||
Compensation expense | $ 4,025,809 | $ 3,464,140 | $ 289,649 | |
Number of Options | ||||
Outstanding at the beginning of the period (in shares) | 6,133,799 | |||
Granted (in shares) | 2,517,000 | |||
Exercised (in shares) | (196,185) | (226,201) | ||
Forfeited (in shares) | (390,896) | |||
Outstanding at the end of the period (in shares) | 8,063,718 | 6,133,799 | ||
Vested and expected to vest at the end of the period (in shares) | 7,824,106 | |||
Exercisable at the end of the period (in shares) | 3,635,917 | |||
Weighted Average Exercise Price | ||||
Outstanding at the beginning of the period (in dollars per share) | $ 4.60 | |||
Granted (in dollars per share) | 6.38 | |||
Exercised (in dollars per share) | 4.60 | |||
Forfeited (in dollars per share) | 5.26 | |||
Outstanding at the end of the period (in dollars per share) | 5.12 | $ 4.60 | ||
Vested and expected to vest at the end of the period (in dollars per share) | 5.51 | |||
Exercisable at the end of the period (in dollars per share) | $ 4.60 | |||
Weighted Average Remaining Contractual Term | ||||
Outstanding at the end of the period | 8 years 6 months | 8 years 11 months 1 day | ||
Vested and expected to vest at the end of the period | 8 years 11 months 19 days | |||
Exercisable at the end of the period | 7 years 11 months 1 day | |||
Weighted Average Aggregate Intrinsic Value of Options | ||||
Outstanding at the beginning of the period | $ 37,784,202 | |||
Exercised | 949,907 | $ 1,668,693 | ||
Outstanding at the end of the period | 4,806,104 | 37,784,202 | ||
Vested and expected to vest at the end of the period | 1,663,274 | |||
Exercisable at the end of the period | 4,072,227 | |||
E-House Plan | ||||
Share-Based Compensation | ||||
Compensation expense | 572,340 | 6,000,438 | ||
E-House Plan | Employees Share Options | ||||
Share-Based Compensation | ||||
Compensation expense | $ 0 | $ 5,950,940 | $ 12,817,935 | |
Number of Options | ||||
Outstanding at the beginning of the period (in shares) | 9,476,704 | |||
Exercised (in shares) | (513,261) | (3,446,585) | (4,596,761) | |
Forfeited (in shares) | (7,160) | |||
Outstanding at the end of the period (in shares) | 8,956,283 | 9,476,704 | ||
Vested and expected to vest at the end of the period (in shares) | 8,956,283 | |||
Exercisable at the end of the period (in shares) | 8,956,283 | |||
Weighted Average Exercise Price | ||||
Outstanding at the beginning of the period (in dollars per share) | $ 4.52 | |||
Exercised (in dollars per share) | 1.86 | |||
Forfeited (in dollars per share) | 4.74 | |||
Outstanding at the end of the period (in dollars per share) | 4.67 | $ 4.52 | ||
Vested and expected to vest at the end of the period (in dollars per share) | 4.67 | |||
Exercisable at the end of the period (in dollars per share) | $ 4.67 | |||
Weighted Average Remaining Contractual Term | ||||
Outstanding at the end of the period | 4 years 9 months 18 days | |||
Vested and expected to vest at the end of the period | 4 years 9 months 18 days | |||
Exercisable at the end of the period | 4 years 9 months 18 days | |||
Weighted Average Aggregate Intrinsic Value of Options | ||||
Outstanding at the beginning of the period | $ 25,776,635 | |||
Exercised | 1,745,007 | $ 23,679,729 | $ 25,248,554 | |
Outstanding at the end of the period | 14,509,178 | $ 25,776,635 | ||
Vested and expected to vest at the end of the period | 14,509,178 | |||
Exercisable at the end of the period | 14,509,178 | |||
Omnigold Plan | ||||
Share-Based Compensation | ||||
Compensation expense | $ 80,577 | |||
Omnigold Plan | Employees Share Options | ||||
Number of Options | ||||
Granted (in shares) | 2,400,000 | |||
Forfeited (in shares) | (130,000) | |||
Outstanding at the end of the period (in shares) | 2,270,000 | |||
Vested and expected to vest at the end of the period (in shares) | 1,966,771 | |||
Weighted Average Exercise Price | ||||
Granted (in dollars per share) | $ 1.50 | $ 1.50 | ||
Forfeited (in dollars per share) | 1.50 | |||
Outstanding at the end of the period (in dollars per share) | 1.50 | |||
Vested and expected to vest at the end of the period (in dollars per share) | $ 1.50 | |||
Weighted Average Remaining Contractual Term | ||||
Granted | 10 years | |||
Outstanding at the end of the period | 9 years 7 months 10 days | |||
Vested and expected to vest at the end of the period | 9 years 7 months 10 days |
Share-Based Compensation (Det53
Share-Based Compensation (Details 3) - USD ($) | Dec. 16, 2013 | Jan. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Leju Plan | Restricted Shares | |||||
Summary of restricted share activity | |||||
Unvested at the beginning of the period (in shares) | 1,526,600 | ||||
Vested (in shares) | (719,064) | ||||
Forfeited (in shares) | (10,200) | ||||
Unvested at the end of the period (in shares) | 797,336 | 1,526,600 | |||
Weighted Average Grant-date Fair Value | |||||
Unvested at the beginning of the period (in dollars per share) | $ 9.42 | ||||
Vested (in dollars per share) | 9.98 | ||||
Forfeited (in dollars per share) | 16.25 | ||||
Unvested at the end of the period (in dollars per share) | $ 8.82 | $ 9.42 | |||
Additional disclosure | |||||
Deemed distribution | $ 41,580 | $ 41,570 | $ 13,903 | ||
Total fair value of restricted shares vested | 7,179,455 | 486,200 | 0 | ||
Total unrecognized compensation expense | $ 4,384,344 | ||||
Weighted-average period over which cost is expected to be recognized | 1 year 2 months 9 days | ||||
Compensation expense | $ 5,273,322 | 4,881,656 | 20,855 | ||
Leju Plan | Leju Replacement Restricted Shares | |||||
Summary of restricted share activity | |||||
Number of replacement awards exchanged with replaced awards (in shares) | 600,000 | 60,000 | |||
Leju Plan | Employees Share Options | |||||
Additional disclosure | |||||
Deemed distribution | $ 1,070,383 | $ 1,061,412 | 92,225 | ||
Exercise of share options | 196,185 | 226,201 | |||
Total intrinsic value of options exercised | $ 949,907 | $ 1,668,693 | |||
Total unrecognized compensation expense | $ 11,525,658 | ||||
Weighted-average period over which cost is expected to be recognized | 2 years 1 month 17 days | ||||
Compensation expense | $ 4,025,809 | 3,464,140 | 289,649 | ||
E-House Plan and CRIC Plan | |||||
Additional disclosure | |||||
Transitional corporate service fees | $ 1,066,477 | 1,857,996 | |||
E-House Plan | |||||
Additional disclosure | |||||
Compensation expense | $ 572,340 | $ 6,000,438 | |||
E-House Plan | Restricted Shares | |||||
Summary of restricted share activity | |||||
Award vesting period | 3 years | ||||
Unvested at the beginning of the period (in shares) | 2,697,049 | ||||
Granted (in shares) | 0 | 1,439,000 | 1,303,000 | ||
Vested (in shares) | (1,288,330) | ||||
Forfeited (in shares) | (50,004) | ||||
Unvested at the end of the period (in shares) | 1,358,715 | 2,697,049 | |||
Weighted Average Grant-date Fair Value | |||||
Unvested at the beginning of the period (in dollars per share) | $ 8.50 | ||||
Vested (in dollars per share) | 7.69 | ||||
Forfeited (in dollars per share) | 7.90 | ||||
Unvested at the end of the period (in dollars per share) | $ 8.50 | $ 8.50 | |||
Additional disclosure | |||||
Total fair value of restricted shares vested | $ 9,909,868 | $ 6,094,602 | $ 5,612,379 | ||
Total unrecognized compensation expense | $ 11,558,404 | ||||
Weighted-average period over which cost is expected to be recognized | 1 year 6 months 11 days | ||||
Compensation expense | $ 9,680,385 | $ 6,174,583 | $ 5,668,460 | ||
E-House Plan | Employees Share Options | |||||
Additional disclosure | |||||
Exercise of share options | 513,261 | 3,446,585 | 4,596,761 | ||
Total intrinsic value of options exercised | $ 1,745,007 | $ 23,679,729 | $ 25,248,554 | ||
Total unrecognized compensation expense | 0 | ||||
Compensation expense | $ 0 | $ 5,950,940 | $ 12,817,935 |
Share-Based Compensation (Det54
Share-Based Compensation (Details 4) - Group of five employees - USD ($) | 1 Months Ended | 12 Months Ended | |
Sep. 30, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | |
Other Equity Compensation | |||
Recognition period of stock based compensation expense | 2 years | ||
Compensation expense | $ 2,138,404 | $ 534,601 | |
Total unrecognized compensation expense | $ 4,276,810 | $ 1,603,805 | $ 3,742,209 |
Employee Benefit Plans (Details
Employee Benefit Plans (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Employee Benefit Plans | |||
Contribution by group | $ 20,413,820 | $ 17,727,125 | $ 14,174,182 |
Distribution of Profits (Detail
Distribution of Profits (Details) - PRC - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Distribution of profits | ||
Minimum percentage of after-tax profit transferred by subsidiaries and VIEs to fund a statutory reserve | 10.00% | |
Threshold percentage of after-tax income required to be appropriated towards reserve until the reserve balance reaches a specified percentage of the registered capital | 50.00% | |
Reserve fund | $ 7,990,298 | $ 7,251,948 |
Restricted net assets | 33,778,838 | 33,040,488 |
VIEs | ||
Distribution of profits | ||
Restricted net assets of subsidiaries and VIEs attributed to general reserve and registered capital | $ 8,342,759 | $ 8,349,188 |
Segment Information (Details)
Segment Information (Details) | 12 Months Ended | ||
Dec. 31, 2015USD ($)item | Dec. 31, 2014USD ($)item | Dec. 31, 2013USD ($)item | |
Revenue information of the Group | |||
Total revenues | $ 575,803,936 | $ 496,022,873 | $ 335,421,516 |
Net accounts receivable | 113,991,480 | 119,741,936 | |
Accounts receivable | Customer risk | Customer A | |||
Revenue information of the Group | |||
Net accounts receivable | $ 14,011,827 | $ 13,979,270 | |
Revenue | Customer risk | |||
Revenue information of the Group | |||
Number of customers | item | 0 | 0 | 0 |
E-commerce | |||
Revenue information of the Group | |||
Total revenues | $ 420,552,177 | $ 326,679,871 | $ 170,204,545 |
Online advertising | |||
Revenue information of the Group | |||
Total revenues | 134,229,255 | 155,049,818 | 145,444,790 |
Listing | |||
Revenue information of the Group | |||
Total revenues | $ 21,022,504 | $ 14,293,184 | $ 19,772,181 |
Related Party Balances and Tr58
Related Party Balances and Transactions (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |||
May. 31, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2015 | |
Related Party Balances and Transactions | |||||
Loans from E-House for capital contribution | $ 120,000 | $ 1,000 | |||
Significant related party transactions | |||||
Dividends | $ 26,873,022 | $ 26,873,022 | |||
Due from related parties | 8,906 | 684 | |||
Amounts due to related parties | 10,214,007 | 5,289,491 | |||
Rollforward of payable (receivable) balance | |||||
Refund loans to related parties | (42,513,286) | (43,818,894) | |||
Loans from E-House for capital contribution | 120,000 | 1,000 | |||
Ordinary Shares | |||||
Significant related party transactions | |||||
Payment of a cash dividend (in dollars per share) | $ 0.20 | ||||
ADSs | |||||
Significant related party transactions | |||||
Payment of a cash dividend (in dollars per share) | 0.20 | ||||
E-House | |||||
Related Party Balances and Transactions | |||||
Loans from E-House for capital contribution | 0 | 0 | 1,000 | ||
Significant related party transactions | |||||
Corporate expenses allocated from E-House | 2,857,251 | 15,527,623 | |||
Corporate service under transitional service agreement | 6,040,071 | 10,399,978 | |||
Services purchased from/rental paid | 5,927,764 | 1,191,469 | 949,584 | ||
Online advertising services provided | 28,679 | 160,238 | 10,614 | ||
Dividends | 18,738,984 | ||||
Cash dividends | (18,738,984) | ||||
Amounts due to related parties | 7,783,911 | 1,560,283 | |||
Rollforward of payable (receivable) balance | |||||
Balance at the beginning of the period | 1,560,283 | (3,471,958) | 79,553,723 | ||
Refund loans to related parties | (42,513,286) | (43,818,894) | |||
Loans from E-House for capital contribution | 0 | 0 | 1,000 | ||
Corporate expenses allocated from E-House | 2,857,251 | 15,527,623 | |||
Corporate service under transitional service agreement | 6,040,071 | 10,399,978 | |||
Revenues collected by E-House on behalf of the Company | (4,803,958) | (45,449,972) | |||
Related party balance waived as capital contribution | (2,857,251) | (15,528,623) | |||
Service provided to E-House | (28,679) | (160,238) | (10,614) | ||
Service purchased from E-House | 5,927,764 | 1,191,469 | 949,584 | ||
Net (payment) receipt for services | 36,797,758 | (1,595,010) | 5,304,215 | ||
Loan payable to E-House | 42,513,286 | ||||
Service payable to E-House | 16,440,049 | 9,852,476 | |||
Receivables for E-House collection on behalf of the Company | (8,656,138) | (50,805,479) | |||
Amounts due to E- House | $ 7,783,911 | 1,560,283 | |||
Percentage of dues waived | 100.00% | ||||
Due from Related Parties | $ 0 | ||||
Balance at the end of the period | 7,783,911 | 1,560,283 | (3,471,958) | ||
E-House | Ordinary Shares | |||||
Significant related party transactions | |||||
Payment of a cash dividend (in dollars per share) | 0.20 | ||||
E-House | ADSs | |||||
Significant related party transactions | |||||
Payment of a cash dividend (in dollars per share) | $ 0.20 | ||||
E-House Management | |||||
Significant related party transactions | |||||
Amounts due to related parties | 92,000 | 184,000 | |||
SINA | |||||
Significant related party transactions | |||||
Online advertising agency fee recognized as cost of revenues purchased | 6,093,974 | 6,630,010 | $ 6,033,036 | ||
Online advertising services provided | 19,899 | ||||
Amounts due to related parties | 1,418,096 | 1,705,208 | |||
Rollforward of payable (receivable) balance | |||||
Service provided to E-House | (19,899) | ||||
CRERAT | |||||
Significant related party transactions | |||||
Online advertising services provided | 3,174 | ||||
Due from related parties | 8,906 | 684 | |||
Rollforward of payable (receivable) balance | |||||
Service provided to E-House | (3,174) | ||||
Management | |||||
Significant related party transactions | |||||
Amounts due to related parties | $ 920,000 | $ 1,840,000 | |||
E-House | CRERAT | |||||
Related Party Balances and Transactions | |||||
Equity interest (as a percent) | 51.00% |
Commitments and Contingencies59
Commitments and Contingencies (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Operating lease commitments | |||
Rental expenses | $ 10,078,033 | $ 8,601,039 | $ 7,669,866 |
Future minimum lease payments under non-cancelable operating lease agreements | |||
2,016 | 9,446,098 | ||
2,017 | 8,059,931 | ||
2,018 | 3,787,386 | ||
2,019 | 974,745 | ||
2,020 | 713,510 | ||
Then thereafter | 1,035,233 | ||
Total | $ 24,016,903 | ||
Minimum | |||
Operating lease commitments | |||
Operating lease term | 1 month | ||
Maximum | |||
Operating lease commitments | |||
Operating lease term | 120 months |