Year-on-year revenue growth exceeds 100% for the seventh consecutive quarter

BEIJING, March 16, 2016 (GLOBE NEWSWIRE) -- Qunar Cayman Islands Limited (NASDAQ:QUNR) ("Qunar" or the "Company"), China's leading mobile and online travel platform, today announced its unaudited financial results for the fourth quarter and fiscal year ended December 31, 2015.

Highlights for the Fourth Quarter and Fiscal Year 2015

Fourth Quarter 2015

• Total revenues for the fourth quarter of 2015 were RMB1,294.0 million (US$199.8 million), an increase of 149.0% year-on-year.
• Gross profit for the fourth quarter of 2015 were RMB786.6 million (US$121.4 million), an increase of 105.9% year-on-year.
• Mobile revenues for the fourth quarter of 2015 were RMB973.9 million (US$150.3 million), an increase of 278.3% year-on-year, representing 75.3% of total revenues, compared to 49.5% in the corresponding period of 2014.

Fiscal Year 2015

• Total revenues for fiscal year 2015 were RMB4,171.2 million (US$643.9 million), an increase of 137.4% year-on-year.
• Gross profit for fiscal year 2015 were RMB2,738.0 million (US$422.7 million), an increase of 110.3% year-on-year.
• Mobile revenues for fiscal year 2015 were RMB2,948.0 million (US$455.1 million), an increase of 316.1% year-on-year, representing 70.7% of total revenues, compared to 40.3% in 2014.

“We are proud of what we have achieved in 2015 as total revenues grew 137.4% year-on-year with significant progress across our business lines,” said Zhenyu Chen, chief executive officer of Qunar. “We believe our team’s work in 2015 has laid a solid foundation for Qunar to achieve balanced and sustainable long term growth in 2016 and beyond.”

Fourth Quarter 2015 Financial Results

Total revenues for the fourth quarter of 2015 were RMB1,294.0 million (US$199.8 million), an increase of 149.0% year-on-year.

Mobile revenues for the fourth quarter of 2015 were RMB973.9 million (US$150.3 million), an increase of 278.3% year-on-year, representing 75.3% of total revenues.

Flight and flight related revenues for the fourth quarter of 2015 were RMB636.2 million (US$98.2 million), an increase of 84.7% year-on-year and 6.6% quarter-on-quarter. Year-on-year flight and flight related revenue growth was primarily due to an increase in revenue per ticket and an increase in Total Estimated Flight Ticket volume (TEFT).

Accommodation reservation revenues were RMB535.1 million (US$82.6 million), an increase of 423.6% year-on-year and remaining relatively stable quarter-on-quarter. Excluding revenues generated from the merchant model program, where revenues are booked on a gross basis, accommodation reservation revenues were RMB312.7 million (US$48.3 million), an increase of 206.0% year-on-year. Year-on-year accommodation reservation revenue growth was primarily due to the increase in Total Estimated Hotel Room-night volume (TEHR).

Gross profit for the fourth quarter of 2015 was RMB786.6 million (US$121.4 million), an increase of 105.9% year-on-year. Gross margin for the fourth quarter of 2015 was 60.8%, compared to 73.5% for the corresponding period of 2014 and 62.4% for the third quarter of 2015. The quarter-on-quarter and year-on-year decreases in gross margin were primarily due to the increase in certain accommodation reservation revenues booked on a gross basis. The year-on-year increase in gross profit during the quarter was primarily due to the significant increase in total revenues.

Product development expenses for the fourth quarter of 2015 were RMB1,531.8 million (US$236.5 million), an increase of 532.7% year-on-year, primarily due to a significant increase in share-based compensation expenses resulting from issuances under our new 2015 share incentive plan and our previously announced employee share exchange program that became effective starting on December 14, 2015 (the “Employee Share Exchange Program”), and an increase over the same period last year in salary, welfare and other expenses associated with headcount increases. Excluding share-based compensation expenses, product development expenses were RMB323.9 million (US$50.0 million), an increase of 43.6% year-on-year, and accounted for 25.0% of total revenues, compared to 43.4% for the corresponding period of 2014 and 26.9% for the third quarter of 2015.

Product sourcing expenses for the fourth quarter of 2015 were RMB339.4 million (US$52.4 million), an increase of 207.0% year-on-year, primarily due to a significant increase in share-based compensation expenses resulting from issuances under our new 2015 share incentive plan and Employee Share Exchange Program and an increase over the same period last year in product sourcing headcount. Excluding share-based compensation expenses, product sourcing expenses were RMB193.6 million (US$29.9 million), an increase of 77.9% year-on-year, and accounted for 15.0% of total revenues, compared to 20.9% for the corresponding period of 2014 and 13.9% for the third quarter of 2015.

Sales and marketing expenses for the fourth quarter of 2015 were RMB872.8 million (US$134.7 million), an increase of 213.0% year-on-year, primarily due to a significant increase in share-based compensation expenses resulting from issuances under our new 2015 share incentive plan and Employee Share Exchange Program and stepped up discretionary expenditures to acquire new mobile users through offline channels, and to a lesser degree due to an increase in online marketing expenses as well as salary and welfare expenses as a result of increased headcount. The headcount expenses under sales and marketing were primarily expenses related to personnel with operational functions, including our customer service staff, photographers, editors, and staff responsible for data analysis. Excluding share-based compensation expenses, sales and marketing expenses were RMB589.2 million (US$91.0 million), an increase of 114.5% year-on-year, and accounted for  45.5% of total revenues, compared to 52.9% for the corresponding period of 2014 and 57.1% for the third quarter of 2015.

General and administrative expenses for the fourth quarter of 2015 were RMB2,998.4 million (US$462.9 million), an increase of 2,814.1% year-on-year, primarily due to a significant increase in share-based compensation expenses and related professional service fees resulting from issuances under our new 2015 share incentive plan and Employee Share Exchange Program, and an increase in salary and welfare expenses associated with headcount increase. Excluding share-based compensation expenses, general and administrative expenses were RMB133.2 million (US$20.6 million), an increase of 121.5% year-on-year, and accounted for 10.3% of total revenues, compared to 11.6% for the corresponding period of 2014 and 5.8% for the third quarter of 2015.

Operating loss for the fourth quarter of 2015 was RMB4,955.8 million (US$765.0 million), compared to RMB666.6 million in the corresponding period of 2014 and RMB661.1 million in the third quarter of 2015.

Operating loss on a non-GAAP basis, which excludes share-based compensation expenses of RMB4,502.5 million (US$695.1 million), was RMB453.3 million (US$70.0 million) for the fourth quarter of 2015.

Operating margin (non-GAAP) for the fourth quarter of 2015 was negative 35.0%, compared to negative 55.2% in the corresponding period of 2014 and negative 41.3% in the third quarter of 2015. The year-on-year increase in operating loss was mainly attributable to a ROI-driven, aggressive marketing strategy, and continued investment in product development and product sourcing to accelerate rapid market share gains, especially with respect to the development of the Company's hotel direct business. The quarter-on-quarter decrease in operating loss was primarily due to strong revenue and controlled operating expenditures.

Net loss attributable to Qunar’s shareholders for the fourth quarter of 2015 was RMB5,091.0 million (US$785.9 million), compared to RMB675.5 million in the corresponding period of 2014 and RMB734.8 million in the third quarter of 2015. The quarter–on-quarter increase in net loss was primarily due to share-based compensation expenses resulting from issuances under our new 2015 share incentive plan and Employee Share Exchange Program.  Basic and diluted net loss per ADS for the fourth quarter of 2015 was RMB36.90 (US$5.70).

Adjusted net loss (non-GAAP), defined as net loss excluding share-based compensation expenses of RMB4,502.5 million (US$695.1 million) and impairment loss of long-term investments of RMB39.4 million (US$6.1 million), was RMB550.9 million (US$85.0 million) for the fourth quarter of 2015, compared to adjusted net loss of RMB295.9 million in the corresponding period of 2014 and adjusted net loss of RMB624.2 million in the third quarter of 2015.

Adjusted EBITDA (non-GAAP), defined as net loss before income tax expense, depreciation and amortization, interest expense, further adjusted to exclude share-based compensation expenses of RMB4,502.5 million (US$695.1 million) and impairment loss of long-term investments of RMB39.4 million (US$6.1 million), was negative RMB443.5 million (US$68.5 million) for the fourth quarter of 2015, compared to negative RMB268.8 million in the corresponding period of 2014 and negative RMB537.3 million in the third quarter of 2015.

Fiscal Year 2015 Financial Results

Total revenues for fiscal year 2015 were RMB4,171.2 million (US$643.9 million), an increase of 137.4% year-on-year.

Mobile revenues for fiscal year 2015 were RMB2,948.0 million (US$455.1 million), an increase of 316.1% year-on-year, representing 70.7% of total revenues.

Flight and flight related revenues for fiscal year 2015 were RMB2,206.9 million (US$340.7 million), an increase of 88.4% year-on-year. Year-on-year flight and flight related revenue growth was primarily due to an increase in revenue per ticket and an increase in TEFT.

Accommodation reservation revenues for fiscal year 2015 were RMB1,472.9 million (US$227.4 million), an increase of 324.1% year-on-year. Excluding revenues generated from the merchant model program, where revenues are booked on a gross basis, accommodation reservation revenues were RMB956.9 million (US$147.7 million), an increase of 175.5% year-on-year. Year-on-year accommodation reservation revenue growth was primarily due to an increase in TEHR.

Gross profit for fiscal year 2015 was RMB2,738.0 million (US$422.7 million), an increase of 110.3% year-on-year. Gross margin for fiscal year 2015 was 65.6%, compared to 74.1% for 2014. The year-on-year decrease in gross margin was primarily due to the increase in certain accommodation reservation revenues booked on a gross basis. The year-on-year increase in gross profit was primarily due to the significant increase in total revenues.

Product development expenses for fiscal year 2015 were RMB2,578.5 million (US$398.1 million), an increase of 232.9% year-on-year, primarily due to a significant increase in share-based compensation expenses resulting from issuances under our new 2015 share incentive plan and Employee Share Exchange Program and an increase in salary, welfare and other expenses associated with headcount increases. Excluding share-based compensation expenses, product development expenses were RMB1,278.9 million (US$197.4 million), an increase of 79.0% year-on-year, and accounted for 30.7% of total revenues, compared to 40.7% for 2014.

Product sourcing expenses for fiscal year 2015 were RMB785.4 million (US$121.2 million), an increase of 147.8% year-on-year, primarily due to a significant increase in share-based compensation expenses resulting from issuances under our new 2015 share incentive plan and Employee Share Exchange Program and an increase in product sourcing headcount. Excluding share-based compensation expenses, product sourcing expenses were RMB633.5 million (US$97.8 million), an increase of 101.8% year-on-year, and accounted for 15.2% of total revenues, compared to 17.9% for 2014.

Sales and marketing expenses for fiscal year 2015 were RMB2,671.6 million (US$412.4 million), an increase of 199.9% year-on-year, primarily due to a significant increase in share-based compensation expenses resulting from issuances under our new 2015 share incentive plan and Employee Share Exchange Program, stepped up discretionary expenditures to acquire new mobile users through offline channels, and to a lesser degree due to an increase in online marketing expenses as well as salary and welfare expenses as a result of increased headcount. The headcount expenses under sales and marketing were primarily expenses related to personnel with operational functions, including our customer service staff, photographers, editors, and staff responsible for data analysis. Excluding share-based compensation expenses, sales and marketing expenses were RMB2,361.0 million (US$364.5 million), an increase of 168.8% year-on-year, and accounted for 56.6% of total revenues, compared to 50.0% for 2014.

General and administrative expenses for fiscal year 2015 were RMB3,388.5 million (US$523.1 million), an increase of 747.3% year-on-year, primarily due to a significant increase in share-based compensation expenses resulting from issuances under our new 2015 share incentive plan and Employee Share Exchange Program and an increase in salary and welfare expenses associated with headcount increases. Excluding share-based compensation expenses, general and administrative expenses were RMB368.0 million (US$56.8 million), an increase of 76.1% year-on-year, and accounted for 8.8% of total revenues, compared to 11.9% for 2014.

Online marketing expenses for the Company’s Baidu Zhixin Cooperation for fiscal year 2015 were RMB37.2 million (US$5.7 million), a decrease of 94.7% year-on-year. The decrease was primarily due to the termination of Baidu Zhixin Cooperation in the second quarter of 2015.

Operating loss for fiscal year 2015 was RMB6,723.2 million (US$1,037.9 million), compared to RMB1,844.8 million for 2014.

Operating loss on a non-GAAP basis, which excludes share-based compensation expenses of RMB4,782.6 million (US$738.3 million) and online marketing expenses from the Zhixin Cooperation Agreement of RMB37.2 million (US$5.7 million), was RMB1,903.5 million (US$293.8 million) for fiscal year 2015.

Operating margin (non-GAAP) for fiscal year 2015 was negative 45.6%, compared to negative 46.1% for 2014. The year-on-year increase in operating loss was mainly attributable to a ROI-driven, aggressive marketing strategy, and continued investment in product development and product sourcing to accelerate rapid market share gains, especially with respect to the development of the Company's hotel direct business.

Fair value change in warrant liability for fiscal year 2015 was RMB398.0 million (US$61.4 million).  Fair value change in warrant liability represents changes in the fair value of Baidu warrants vested on January 15, 2015. Such warrants were accounted for as a liability until Baidu exercised the warrants in June 2015. There was no such fair value change in the corresponding period of 2014.

Net loss attributable to Qunar’s shareholders for fiscal year 2015 was RMB7,342.7 million (US$1,133.5 million), compared to RMB1,846.9 million for 2014. Basic and diluted net loss per ADS for fiscal year 2015 was RMB57.42 (US$8.85).

Adjusted net loss (non-GAAP), defined as net loss excluding share-based compensation expenses of RMB4,782.6 million (US$738.3 million), impairment loss of long-term investments of RMB39.4 million (US$6.1 million), online marketing expenses from the Zhixin Cooperation Agreement of RMB37.2 million (US$5.7 million) and fair value change in warrant liability of RMB398.0 million (US$61.4 million), was RMB2,092.2 million (US$323.0 million) for fiscal year 2015, compared to adjusted net loss of RMB812.8 million for 2014.

Adjusted EBITDA (non-GAAP), defined as net loss before income tax expense, depreciation and amortization, interest expense, further adjusted to exclude share-based compensation expenses of RMB4,782.6 million (US$738.3 million), impairment loss of long-term investments of RMB39.4 million (US$6.1 million), online marketing expenses from the Zhixin Cooperation Agreement of RMB37.2 million (US$5.7 million) and fair value change in warrant liability of RMB398.0 million (US$61.4 million), was negative RMB1,818.7 million (US$280.8 million) for fiscal year 2015, compared to negative RMB743.2 million for 2014.

As of December 31, 2015, Qunar had cash and cash equivalents, restricted cash, funds receivables and short-term investment of RMB6,929.8 million (US$1,069.8 million).

Recent Events

On January 4, 2016, Qunar announced changes to its management, which became effective as of January 4, 2016. Mr. Zhenyu Chen, Qunar’s Executive Vice President and Head of Mobile Business Group, was appointed as Qunar’s chief executive officer.  Mr. Qiang Zhang, Qunar’s Executive Vice President and Head of Destination Services Business Group, assumed the role of its chief operating officer.  Mr. Xiaolu Zhu, Qunar’s Senior Director of Strategy and Investor Relations, was appointed as Qunar's chief financial officer.

In addition, Qunar also announced changes to its board of directors (the “Board”) which became effective as of January 4, 2016.  The new Board consists of five members, namely Mr. James Liang, Mr. Zhenyu Chen, and three independent directors, Mr. Jimmy Lai, Mr. Jianmin Zhu and Ms. Ying Shi.

As of February 29, 2016, Qunar had 7,345,925 Class A ordinary shares and 426,801,591 Class B ordinary shares outstanding.

Conference Call

Qunar's management will hold an earnings conference call at 8:00 PM on March 16, 2016, U.S. Eastern Time (8:00 AM on March 17, 2016, Beijing/Hong Kong Time).

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

International:		+65-6823-2299
U.S.:		+1-631-514-2526
UK:		+44-20-3078-7622
Hong Kong:		+852-5808-3202
Mainland China:		400-120-0539

Passcode for all regions: 2212593

A replay of the conference call may be accessed by phone at the following number until March 23, 2016:

International:		+61-2-9641-7900
Passcode:		2212593

Additionally, a live and archived webcast of this conference call will be available at http://investor.qunar.com.

Forward-looking Statements

This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates," "confident" and similar statements. Among other things, quotations from management in this press release, as well as Qunar's strategic and operational plans, contain forward-looking statements. Qunar may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission, in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about Qunar's beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: the Company's goals and strategies; its future business development, financial condition and results of operations; the expected growth of the online travel markets in China; the Company's expectations regarding demand for and market acceptance of its products and services; its expectations regarding relationships with users and travel service providers; its plans to invest in the technology platform; competition in the industry; fluctuations in general economic and business conditions in China; and relevant government policies and regulations relating to the industry. Further information regarding these and other risks is included in the documents filed with the U.S. Securities and Exchange Commission. All information provided in this press release and in the attachments is as of the date of the press release, and Qunar undertakes no duty to update such information, except as required under applicable law.

About Non-GAAP Financial Measures

To supplement Qunar's consolidated financial results presented in accordance with United Statements Generally Accepted Accounting Principles ("GAAP"), Qunar also uses adjusted net income (loss), adjusted EBITDA and adjusted operating income (loss) as additional non-GAAP financial measures. These non-GAAP financial measures enable management to assess the Company's operating results without considering the impact of noncash charges, including share-based compensation expenses, depreciation and amortization, online marketing expenses from the Zhixin Cooperation Agreement, fair value change in warrant liability and impairment loss of the long-term investments. Furthermore, these non-GAAP financial measures eliminate the impact of items that Qunar does not consider indicative of the performance of its business.

Qunar presents these non-GAAP financial measures because they are used by management to evaluate its operating performance, formulate business plans, and make strategic decisions on capital allocation. Qunar also believes that these non-GAAP financial measures provide useful information to investors and others in understanding and evaluating its operating performance and consolidated results of operations in the same manner as management and in comparing financial results across accounting periods and to those of its peer companies. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. A limitation of using these non-GAAP financial measures is that these non-GAAP measures do not include all items that impact the Company's results of operations for the period. The table captioned "Reconciliations of GAAP and non-GAAP Measures" has more details on the reconciliations between GAAP financial measures that are most directly comparable to the non-GAAP financial measures.

Currency Convenience Translation

The United States dollar (US$) amounts disclosed in this press release are presented solely for the convenience of the reader. The conversion of Renminbi (RMB) into U.S. dollars is based on the exchange rate set forth in the H.10 statistical release of the Federal Reserve Bank of New York on December 31, 2015, which was RMB6.4778 to US$1.00. The Company makes no representation that any Renminbi or U.S. dollar amounts could have been, or could be, converted into U.S. dollars or Renminbi, as the case may be, at any particular rate, or at all. The percentages stated are calculated based on the RMB amounts.

About Qunar

Qunar is China’s leading mobile and online travel platform. With a commitment to building a travel ecosystem serving the entire travel industry value chain, Qunar is evolving the way people travel in a world increasingly enabled by technology. Qunar addresses the needs of Chinese travelers and travel service providers by efficiently matching industry supply and demand through its proprietary technologies. By providing technology infrastructure for travel service providers on mobile and online platforms, Qunar integrates and offers the most comprehensive selection of travel products and the most convenient means to complete desired transactions for Chinese travelers.

Qunar means “where to go” in Mandarin Chinese.

For more information, please visit http://ir.qunar.com.

Qunar Cayman Islands Limited
Condensed Consolidated Balance Sheets
		December 31,				December 31,				December 31,
			2014				2015				2015
(In thousands except for number of shares and per share data)		RMB				RMB				USD
		Audited				Unaudited				Unaudited
ASSETS
Current assets:
Cash and cash equivalents			812,972				4,115,650				635,347
Restricted cash			236,929				1,747,603				269,783
Funds receivable			413,084				715,365				110,433
Short-term investments			-				351,189				54,214
Accounts receivable, net			165,404				278,382				42,975
Due from related parties			39,951				813,123				125,525
Prepayments and other current assets			259,734				1,320,492				203,849
Deferred tax assets, current			22,859				80,513				12,429
Total current assets			1,950,933				9,422,317				1,454,555
Non-current assets:
Property and equipment, net			149,307				232,085				35,828
Intangible assets, net			2,849				12,689				1,959
Goodwill			-				10,755				1,660
Long-term investments, net			103,175				712,967				110,063
Deferred tax assets, non-current							111				17
Other non-current assets			61,453				114,621				17,694
Total non-current assets			316,784				1,083,228				167,221
Total assets			2,267,717				10,505,545				1,621,776
LIABILITIES AND (DEFICIT) EQUITY
Current liabilities:
Short-term loans			-				643,500				99,339
Customer advances and deposits			258,992				280,962				43,373
Due to related parties			6,305				1,961,500				302,803
Accounts payable			19,813				31,720				4,898
Salaries and welfare payable			201,433				418,431				64,595
Income tax payable			22,821				79,736				12,309
Accrued expenses and other current liabilities			1,155,547				3,134,951				483,953
Warrant liability			701,776				-				-
Total current liabilities			2,366,687				6,550,800				1,011,270
Non-current liabilities:
Deferred tax liability, non-current			-				1,318				203
Long-term Debt			-				2,658,357				410,380
Non-current liabilities			71,616				91,702				14,156
Total non-current liabilities			71,616				2,751,377				424,739
Total liabilities			2,438,303				9,302,177				1,436,009
(Deficit) equity:
Class A ordinary shares			1,426				87				13
Class B ordinary shares			831				2,638				407
Additional paid-in capital			2,069,313				10,647,579				1,643,703
Accumulated other comprehensive income			4,163				136,810				21,120
Statutory reserves			-				3,011				465
Accumulated deficit			(2,246,319	)			(9,592,039	)			(1,480,756	)
Total Qunar Cayman Islands Limited's shareholders' (deficit) equity			(170,586	)			1,198,086				184,952
Noncontrolling Interests			-				5,282				815
Total (deficit) equity			(170,586	)			1,203,368				185,767
Total liabilities and (deficit) equity			2,267,717				10,505,545				1,621,776

 

Qunar Cayman Islands Limited
Condensed Consolidated Statements of Operations
			Three Months Ended																Year ended
			December 31,				September 30,				December 31,				December 31,				December 31,				December 31,				December 31,
				2014				2015				2015				2015				2014				2015				2015
(In thousands except for number of shares and per share(ADS) data)			RMB				RMB				RMB				USD				RMB				RMB				USD
			Unaudited				Unaudited				Unaudited				Unaudited				Audited				Unaudited				Unaudited
Revenues(*)
Flight and flight related				344,427				596,555				636,153				98,205				1,171,229				2,206,948				340,694
Accommodation reservation				102,198				550,673				535,099				82,605				347,281				1,472,925				227,380
Display advertising services				26,742				39,740				31,139				4,807				87,894				117,945				18,208
Other services				46,391				138,169				91,646				14,148				150,351				373,394				57,642
Total revenues				519,758				1,325,137				1,294,037				199,765				1,756,755				4,171,212				643,924
Cost of Revenues				(137,679	)			(498,357	)			(507,424	)			(78,333	)			(454,902	)			(1,433,237	)			(221,253	)
Gross profit				382,079				826,780				786,613				121,432				1,301,853				2,737,975				422,671
Operating expenses:
Product developments (Note 1)				(242,101	)			(408,848	)			(1,531,773	)			(236,465	)			(774,511	)			(2,578,528	)			(398,056	)
Product sourcing (Note 1)				(110,557	)			(187,084	)			(339,422	)			(52,398	)			(316,903	)			(785,385	)			(121,243	)
Sales and marketing (Note 1)				(278,850	)			(768,304	)			(872,803	)			(134,738	)			(890,861	)			(2,671,637	)			(412,430	)
General and administrative  (Note 1)				(102,893	)			(123,595	)			(2,998,420	)			(462,876	)			(399,914	)			(3,388,467	)			(523,089	)
Online marketing expense for Baidu Zhixin Cooperation				(249,820	)			-				-				-				(699,983	)			(37,178	)			(5,739	)
Contract termination loss provision				(64,485	)			-				-								(64,485	)			-
Operating loss				(666,627	)			(661,051	)			(4,955,805	)			(765,045	)			(1,844,804	)			(6,723,220	)			(1,037,886	)
Interest income(expenses), net				4,677				(42,882	)			(55,924	)			(8,633	)			31,329				(110,233	)			(17,017	)
Foreign exchange loss, net				(7,452	)			(29,656	)			(32,203	)			(4,971	)			(20,739	)			(64,106	)			(9,896	)
Other income(loss), net				1,720				1,584				(33,583	)			(5,184	)			4,873				(25,161	)			(3,884	)
Fair value change in warrant liability				-				-				-				-				-				(397,987	)			(61,439	)
Loss before income taxes				(667,682	)			(732,005	)			(5,077,515	)			(783,833	)			(1,829,341	)			(7,320,707	)			(1,130,122	)
Income tax expense				(7,780	)			(4,165	)			(11,547	)			(1,783	)			(17,560	)			(22,784	)			(3,517	)
Equity in loss of affiliated companies,net of tax				-				(1,428	)			(3,719	)			(574	)			-				(5,840	)			(902	)
Net loss				(675,462	)			(737,598	)			(5,092,781	)			(786,190	)			(1,846,901	)			(7,349,331	)			(1,134,541	)
Net loss attributable to noncontrolling interests				-				2,777				1,813				280				-				6,622				1,022
Net loss attributable to Qunar Cayman Islands Limited				(675,462	)			(734,821	)			(5,090,968	)			(785,910	)			(1,846,901	)			(7,342,709	)			(1,133,519	)
Loss per share for ordinary shares：
Net loss per ordinary share—basic				(1.89	)			(1.87	)			(12.30	)			(1.90	)			(5.26	)			(19.14	)			(2.95	)
Net loss per ordinary share—diluted				(1.89	)			(1.87	)			(12.30	)			(1.90	)			(5.26	)			(19.14	)			(2.95	)
Loss per ADS(each ADS represents three class B ordinary shares):
Net loss per ADS—basic				(5.67	)			(5.61	)			(36.90	)			(5.70	)			(15.78	)			(57.42	)			(8.85	)
Net loss per ADS—diluted				(5.67	)			(5.61	)			(36.90	)			(5.70	)			(15.78	)			(57.42	)			(8.85	)
Weighted average number of ordinary shares：
Class A ordinary shares
Basic				238,411,887				217,406,863				64,640,123				64,640,123				266,696,495				182,319,107				182,319,107
Diluted				238,411,887				217,406,863				64,640,123				64,640,123				266,696,495				182,319,107				182,319,107
Class B ordinary shares
Basic				118,570,933				176,259,169				349,136,105				349,136,105				84,713,813				201,373,547				201,373,547
Diluted				356,982,820				393,666,032				413,776,228				413,776,228				351,410,308				383,692,654				383,692,654
Note 1: Includes share-based compensation expenses as follows:
Product developments				16,565				51,813				1,207,853				186,460				59,884				1,299,625				200,628
Product sourcing				1,761				2,871				145,821				22,511				2,958				151,864				23,444
Sales and marketing				4,127				11,364				283,567				43,775				12,565				310,604				47,949
General and administrative				42,775				47,378				2,865,229				442,316				190,963				3,020,480				466,281
Total share-based compensation expenses				65,228				113,426				4,502,470				695,062				266,370				4,782,573				738,302
* Starting from January 2015, we present our revenues by primary business lines of flight and flight related, accommodation reservation, display advertising services and other services. Comparative amounts for the prior periods have been reclassified to conform to the current period presentation.

 

Reconciliations of GAAP and non-GAAP measures (in thousands)
		Three Months Ended																Year ended
		December 31,				September 30,				December 31,				December 31,				December 31,				December 31,				December 31,
			2014				2015				2015				2015				2014				2015				2015
		RMB				RMB				RMB				USD				RMB				RMB				USD
		Unaudited				Unaudited				Unaudited				Unaudited				Unaudited				Unaudited				Unaudited
Net loss			(675,462	)			(737,598	)			(5,092,781	)			(786,190	)			(1,846,901	)			(7,349,331	)			(1,134,541	)
Add:
Share-based compensation expenses			65,228				113,426				4,502,470				695,062				266,370				4,782,573				738,302
Impairment loss of the long-term investments			-				-				39,425				6,086				-				39,425				6,086
Non-cash expenses relating to free user traffic contributed by Baidu			-				-				-				-				3,304				-				-
Online marketing expense for Baidu Zhixin Cooperation			249,820				-				-				-				699,983				37,178				5,739
Fair Value change in warrant liability			-				-				-				-				-				397,987				61,439
Contract termination loss provision			64,485								-								64,485				-				-
Adjusted net loss (non-GAAP)(*)			(295,929	)			(624,172	)			(550,886	)			(85,042	)			(812,759	)			(2,092,168	)			(322,975	)
Add:
Income tax expense			7,780				4,165				11,547				1,783				17,560				22,784				3,517
Depreciation and amortization			19,395				28,831				29,378				4,535				52,048				112,061				17,299
Interest expense			-				53,845				66,473				10,262				-				138,626				21,400
Adjusted EBITDA (non-GAAP)  (**)			(268,754	)			(537,331	)			(443,488	)			(68,462	)			(743,151	)			(1,818,697	)			(280,759	)
Operating loss			(666,627	)			(661,051	)			(4,955,805	)			(765,045	)			(1,844,804	)			(6,723,220	)			(1,037,886	)
Add:
Share-based compensation expenses			65,228				113,426				4,502,470				695,062				266,370				4,782,573				738,302
Non-cash expenses relating to free user traffic contributed by Baidu			-				-				-				-				3,304				-				-
Online marketing expense for Baidu Zhixin Cooperation			249,820				-				-				-				699,983				37,178				5,739
Contract termination loss provision			64,485				-				-				-				64,485				-				-
Adjusted operating loss(non-GAAP)(***)			(287,094	)			(547,625	)			(453,335	)			(69,983	)			(810,662	)			(1,903,469	)			(293,845	)
*Adjusted net loss (non-GAAP), defined as net loss excluding share-based compensation expenses,impairment loss of the long-term investments, non-cash expenses relating to free user traffic contributed by Baidu, Inc., online marketing expenses for Baidu Zhixin Cooperation, fair value change in warrant liability and contract termination loss provision.
** Adjusted EBITDA (non-GAAP), defined as net loss before income taxes, interest expenses, depreciation and amortization, further adjusted to exclude share-based compensation expenses, impairment loss of the long-term investments, non-cash expenses relating to free user traffic contributed by Baidu, Inc., online marketing expenses for Baidu Zhixin Cooperation, fair value change in warrant liability and contract termination loss provision.
*** Adjusted operating loss(non-GAAP), defined as operating loss excluding share-based compensation expenses, non-cash expenses relating to free user traffic contributed by Baidu, Inc., online marketing expenses for Baidu Zhixin Cooperation and contract termination loss provision.

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Qunar Cayman Islands Limited
Tel: +86-10-8967-6966
Email: ir@qunar.com

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